Oil Constraints Return by 2011-Goldman Sachs

The video is Jeff Rubin's most recent talk on "peak oil": "We're not running out of oil—we're running out of the oil that you can afford to burn."

I've always been skeptical of Jeff Rubin's short term predictions on oil prices. If only he wasn't so right all the time. He predicts triple-digit oil prices by 2012. In fact, Goldman Sachs just announced their prediction for oil prices for the next 24 months: oil will go to $90 a barrel this year, 2010, and to $110 a barrel in 2011.

But note this: I'm not concerned about "peak oil" anymore. Yes, that's right, I'm ok with it. Why? Because I've had a chance to think this through for the last year at UNB and I've come to certain (qualified) conclusions: peak oil is not the problem, peak oil is the solution.

Look at what happened when oil reached $149 in 2008. What happened? People drove less, VMT went down dramatically and people started using public transit in record numbers. People cut back on shopping and started repairing and reusing the stuff they already owned. They started conserving all kinds of things: electricity, oil, water. They ate at home more and wasted less food. They even started growing their own food.

So if peak oil is the solution, what's the problem? I'm more certain all the time that the real problem is capitalist industrial civilization (whether state directed, like China, or corporate-directed, like U.S.) The high price of oil does a swift and decisive job of shrinking an overblown economy and the overdevelopment of land. It swiftly and decisively reduces excessive production and consumption of worthless consumer goods, which slows down the depletion of natural resources, and thus reduces the impact on our climate. We can find ways to adapt to peak oil, whether they are social adaptions or technological ones. The one thing we really can't reverse, at this point, is climate change, and that's the real long-term problem.