20 April 2020

Strategic Stockpile of Oil Now

With oil below $5/bbl,* there is no way that fracking can be profitable. I am of a pragmatic frame of mind, despite my idealistic/social democratic politics, if you choose to believe those are not pragmatic (they actually are, but never mind). The US should restock its oil reserves by buying oil, not for release to the market for use, but for greatly ramped up underground storage. And NOT for future use as fuel. We must, simply must, when this pandemic is over, switch to a major crisis-mode conversion of our industrial and transportation economies, and eventually every aspect of our economy, to renewable energy sources. One of the consequences of that will be that oil exploration and development, which is inherently more expensive than in the past, will become completely unprofitable. Oil companies that have failed to diversify sufficiently will fail. But more to the point, oil production will virtually cease, sometime before 2050. And that's mostly a good thing. But oil is not only a fuel, and in the future will not be a fuel at all. But it WILL be a strategic, critical MATERIAL. For plastics, pharmaceuticals, advanced chemistry. A steady, small compared to today but hardly negligible, supply of oil into the medium-long-term future will be crucial. And here is our opportunity to ensure that supply for generations at the lowest price that will likely EVER be seen for oil again.  

-*Had to correct the above ½ hour after writing it, because oil dropped from below $10/bbl to below FIVE dollars! 


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