Oil Prices Continue To Fall, But Don’t Expect It To Last Forever

The price of oil is continuing to fall, but it won't last forever.


The price of oil continues to fall:

LONDON — Oil prices continued to swoon on Tuesday, tumbling about 3 percent in early trading after dropping more than 5 percent on Monday.

Brent crude, the main international benchmark, was down about 2.7 percent to $46.14 per barrel on Tuesday and has fallen about 8 percent this week. The American benchmark fell almost 3 percent on Tuesday to $44.78 per barrel.

A central factor in the sharp price drops, analysts say, is the continuing unwillingness of OPEC, an organization of oil producers, to intervene to stabilize markets that are widely viewed as oversupplied. Prices of OPEC’s crude benchmark have fallen about 40 percent since the organization declined to cut production at a late November meeting in Vienna.

The oil minister of the United Arab Emirates added to the downward pressure on prices on Tuesday when he told reporters at a conference in Abu Dhabi that it was up to shale oil companies in the United States and other high-cost producers to cut their output.

“Those who are producing the most expensive oil, the rationale and the rules of the market say that they should be the first to pull or reduce their production,” said the minister, Suhail Al Mazrouei.

As this chart shows, the per barrel price of oil is reaching the low point that it hit in the wake of the 2008 financial crisis that brought on the Great Recession, although it’s worth noting that back then prices were starting from the much higher peak of roughly $140/barrel:

Oil Prices

What’s been something of a mystery are the reasons that prices have fallen so precipitously over the past several months, and why it is that most analysts believe that they are likely to continue falling for the foreseeable future. The 2008 price drop was fairly easy to understand, of course. In that case, worldwide demand dropped like a stone thanks to the fact that the worldwide financial crisis had sent the economies of much of the world into recession, and even economies that didn’t go into recession such as China and India saw economic growth slow significantly because of what was going on in the rest of the world. The world’s oil markets began to recover as the economy of the world began to recover, and prices also began to rise once markets began to once again factor into the price the other factors associated with the price of oil, such as limited supply and the fact that the largest reserves of oil continue to exist in one of the most volatile parts of the world.

This time around, it’s hard to pin down exactly what it is that’s motivating such a large price drop this time around. While there are some indications of softening in the world economy in recent months, there are no signs of the kind of economic collapse we saw in 2008. The Middle East certainly isn’t any less tense than it has been in the past and, indeed, if anything, the situation there is becoming more tense thanks to the rise of ISIS and other regional conflicts. For the most part, it appears that we’re looking at simple supply and demand, helped along by increased production in the United States and Canada:

Why is the price of oil dropping so fast? Why now?

This a complicated question, but it boils down to the simple economics of supply and demand.

United States domestic production has nearly doubled over the last six years, pushing out oil imports that need to find another home. Saudi, Nigerian and Algerian oil that once found a home in the United States is suddenly competing for Asian markets, and the producers are forced to drop prices.

On the demand side, the economies of Europe and developing countries are weakening and vehicles are becoming more energy-efficient. So demand for fuel is lagging a bit.

In the past, OPEC would be able to stem  price drop like this by dropping production, but the nations of the cartel find themselves in conundrum:

The price of oil, as with other commodities, goes up and down. And in the past the Organization of the Petroleum Exporting Countries, known asOPEC, has frequently cut production to firm up prices. Iran, Venezuela and Algeria are pressing the cartel to do so again, but Saudi Arabia, the United Arab Emirates and other gulf allies are refusing to cut. At the same time, Iraq is actually pumping more.

Saudi officials have said that if they cut production and prices go up, they will lose market share and merely benefit their competitors.

They say they are willing to see oil prices go much lower, but some oil analysts think they are merely bluffing.

As long as the Saudis and the UAE refuse to cut production, it’s unlikely we’ll see the price of oil rise any time soon. It’s worth noting, though, that oil markets respond the same way other markets do. At some point, the price of oil will hit a floor as supply and demand continue to adjust. At that point, the price drop is likely to stop and the question will become where the the new equilibrium level might be. Many have suggested that it’s unlikely that we’ll see a return to $100/barrel oil any time soon, but it strikes me that it’s silly to say such a thing. After all, given the ever increasing demand from the west, India, and China, the ever present threat of Middle Eastern tensions, and cuts in production. Until then, I suppose we can enjoy the falling prices and the benefits that come from them.


FILED UNDER: Middle East, Uncategorized, , , , , , , , , , , , , ,
Doug Mataconis
About Doug Mataconis
Doug Mataconis held a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020. He passed far too young in July 2021.


  1. al-Ameda says:

    I live here in Northern California, about 50 miles from San Francisco (America’s high cost leader) and I’m used to most prices never coming down, however …

    On Sunday I paid $2.51/gallon to fill my car – I’m still in shock. I have no doubt that prices will bounce back up, in the meantime I’m going out to buy a gas-guzzling SUV or truck – it wouldn’t be right if I didn’t make a personal and financial commitment to waste fossil fuels while prices are low.

  2. C. Clavin says:

    From what I’ve read there are four factors at play:
    Increased US output (absent the silly pipeline…imagine!!!)
    Increased stability in places like Libya and Iraq (in spite of the IS)
    Decreased demand due to slowed growth in Asia and the ongoing switch away from fossil fuels.
    To the extent these factors are structural the drop may be sustainable.
    The fourth is OPECs refusal to give up market share which you talk about above.
    But this price drop on top of existing sanctions is killing Russia and Iran…and who knows how they might act out?

  3. Electroman says:

    @al-Ameda: I actually do drive an SUV. My previous car was a Toyota Camry, and the one before that was a Honda Accord.

    Of those three cars, the one with the highest mileage is the SUV.


  4. OzarkHillbilly says:

    What goes down must come up.

  5. Dave Schuler says:

    In the comments thread to an earlier post commenter Lounsbury noted that the real price of oil has fallen to its historical average. Judging by this paper of James Hamilton’s the present price of oil is still a bit high by post-war standards and even higher by the standards of the experience of the present generation.

    I think the Saudis have it about right: the price of oil won’t go over $100 a barrel for the foreseeable future. That’s bad news for the high cost oil producers which includes Iran, Russia, and some U. S. producers.

  6. TJ Harrow says:

    The price of oil is so low because Saudi Arabia and the UAE are conducting economic warfare at the behest of the US Government against Russia, Iran and Venezuela. “Make the economy scream ” – President Richard Nixon.

  7. al-Ameda says:


    I actually do drive an SUV. My previous car was a Toyota Camry, and the one before that was a Honda Accord.
    Of those three cars, the one with the highest mileage is the SUV.

    fuel economy is improving for all types of vehicles, a good thing.

  8. ernieyeball says:

    April 30, 2012 OTB Voices of the Past

    One problem seems to be that the floor keeps rising. Gone are the days of $1.85 gas. Now we consider ourselves lucky at $3.00. How long before $3.75 seems cheap?

    Well, the gas companies got it above $3 now and they’re happy for now. It is below $4 a gallon
    and the public is apparently satisfied. Next year we go through the same thing with prices settling at $4.50 a gallon. Gas companies win, we lose every time.


  9. wr says:

    This is good advice, Doug. While we’re on the subject, do you have any thoughts on what I should expect to last forever?

  10. ernieyeball says:

    @TJ Harrow:..“Make the economy scream ” – President Richard Nixon.

    For those who weren’t around at the time, in 1971, in response to rising inflation and a weakening economy, President Nixon imposed a series of economic measures including controls on wages and prices throughout a wide swath of the American economy. At the time, Nixon had brought support from the public and even from economists who thought it was the only way to deal with what looked to be out of control inflation. By 1974, though, it was clear that Nixon’s policies hadn’t worked at all, and had probably made the situation worse:..


  11. Moosebreath says:


    In the famed words of Herbert Stein, “If something cannot go on forever, it will stop.”

  12. Jack says:

    @ernieyeball: The average profit for oil companies on gas is .08 cents per gallon. This equates to (2.6% profit margin at $3.00 per gallon). Compare that to state (~.30 cents) and federal (.185 cents) for a total windfall of .485 cents per gallon in taxes or 16% at $3.00 per gallon) and you will really see who is “winning”.

    The real question is who is gouging whom?


  13. ernieyeball says:

    @wr:..any thoughts on what I should expect to last forever?

    Will this do?

    The size of the whole universe is not known – It may be infinite.


  14. OzarkHillbilly says:


    do you have any thoughts on what I should expect to last forever?


  15. C. Clavin says:

    Your facts are way off base per usual. It’s more like $00.08 on every dollar of sales.
    In any case it’s enough that Exxon-Mobil is one if the most profitable corporations in the world.
    Poor, poor, Exxon.
    As for gas-taxes…I guess you don’t drive on roads.

  16. HarvardLaw92 says:

    @TJ Harrow:

    Silly. The Saudis are targeting shale oil production in the US & Canada, and quite effectively. Russia and Iran’s economic woes are an interesting, but tangential, side effect of that.

  17. OzarkHillbilly says:

    @C. Clavin: I think that’s what he was trying to say.

  18. DrDaveT says:


    The real question is who is gouging whom?

    And the answer to that question requires knowing the costs to the government of mitigating the externalities and managing the shared infrastructure of a petroleum-based economy. Are the taxes on gasoline more or less than the costs of dealing with the environmental and health impacts of gasoline, maintaining an adequate road network for those gas-burning vehicles to use, litigating against misbehaviors by gasoline producers, etc.?

  19. Jack says:

    @C. Clavin: Wrong again.

    But the fact is, the gross profit margin for a gallon of gas in America today, is what it has always been, on average, .08 cents per gallon, (2.5% at $3.00 per gallon).


    Your .08 cents figure is based not just upon gas, but upon all products derived from oil to include diesel, heating oil, motor oil, etc. that can be refined from each barrel of oil. Catch up Calvyboy.

  20. JKB says:

    @OzarkHillbilly: What goes down must come up.

    The Law of Gravity defies your assertion.

  21. Jack says:

    @DrDaveT: My point being, that states and federal governments are making more off a gallon of gasoline than the actual producers, yet people want to complain about big oil and record profits. If big oil is making record profits, then so to are the state and federal government.

  22. JKB says:


    Well, then you have to look at all taxes including individual income taxes. Those roads and environmental impacts from gasoline vehicles move goods and help provide services that all workers produce, even government workers. Costly or no fuel, means much less of an economy, which means far fewer taxes collected, which means a lot of the extra baggage, government bureaucrats, academics, etc. get dumped as their cost cannot be borne by such a limited economy.

  23. michael reynolds says:


    If big oil is making record profits, then so to are the state and federal government.

    I see no alternative but to accept your suggestion that Mr. Obama’s government is turning a profit for us. Thank God, right? So much better than the last president.

  24. OzarkHillbilly says:

    @JKB: You missed the fact that inflation is the original anti gravity. Or maybe, you just missed the joke.

  25. Jack says:

    @michael reynolds: Yeah, because federal taxes on gasoline changed how much during his presidency?

    The 18.4-cent-per-gallon gas tax hasn’t been raised since 1993.


    The answer is zero, the same as his contributions towards “turning a profit”.

  26. Tony W says:


    The 18.4-cent-per-gallon gas tax hasn’t been raised since 1993.

    So…how is it that this number is too high then? Have road construction/maintenance costs remained stable since 1993?

  27. C. Clavin says:

    It doesn’t even matter what it is…it’s insanely profitable.
    And we still give them (fossil fuel industry) trillions in direct and indirect subsidies.
    Why are you shilling for one of the biggest recipients of corporate welfare???
    And again…you don’t drive on roads???

  28. michael reynolds says:


    You realize you’re arguing with yourself, right?

    Carry on.

  29. Tyrell says:

    @DrDaveT: I and many others remember the so called oil “crisis” of ’73: long lines, rationing, high prices, disruptions, gas station (that’s what they were called back in the day) attendants directing traffic. The government had no clue and was helpless.We got the same phony reasons: mid east tensions, running out, refinery problems, etc. The truth was that there was no shortage. Oil terminal storage tanks were filled to the brim. Oil tankers waited off coast because there was no storage space. Gas prices shot up. Many gas stations closed and reopened later as “convenience” stores. Gone were the days of free air (now it is $1 to fill 2 tires, if the darn things work), 25 cent Cokes, 5 cent Nabs, cheap car repairs, and free bike tire repairs. Also gone was 23¢ gallon gas. Once the price doubled to 50¢/gallon the “shortage” was over. The big oil companies won. They learned they could get away with it.
    The biggest hoax in US history.

  30. OzarkHillbilly says:

    @Tony W: Details details….

  31. lounsbury says:

    @C. Clavin: While this is a fundamentally boring discussion, as an empirical fact the oil industry is not in fact insanely profitable. It is moderately profitable, with an average profit margin for integrated entities on the order of 6-8 percent. This is not per se brilliant. Not terrible, but not brilliant and not “insanely profitable.”

    Unfortunately people seem to be unable to distinguish between Very Large Numbers and actual profitability as a margin.

    This is not to argue for anything in particular, merely a factual note.

  32. C. Clavin says:

    Exxon Mibil is or was recently the most profitable corporation in the world

  33. OzarkHillbilly says:

    @Tyrell: Oh yeah, OPEC had nothing to do with it.

  34. J-Dub says:

    @michael reynolds:

    Carry on.

    The proper phrase is “Please, proceed.”

  35. Moosebreath says:

    @C. Clavin:

    “Exxon Mibil is or was recently the most profitable corporation in the world”

    As a gross number, yes. As a percentage of sales, no. That was lounsbury’s point.

  36. J-Dub says:

    The price of oil might not be going anywhere. $100 was based on speculation and it’s natural price might be closer to $40. The bubble has burst.


  37. lounsbury says:

    @C. Clavin:
    Perhaps I should thank you for perfectly illustrating the dense innumeracy of being unable to distinguish between Large Numbers and relative numbers.

    Yes, large firms report Very Large profit numbers due to sheer size, however that does not mean they are particularly profitable as a matter of the ratio between Costs and Profits. As it happens, Exxon has a profit margin on the order of 8.7% – an 8.7% profit margin is nothing to cry about but nothing particularly amazing – that is net costs, they are not amazingly profitable. By way of comparison, the Swiss pharma major Novartis has a profit margin of 18%. Apple (US listing) is around 21.6%. Goldan is on the order of 24% (etc).

    Your lesson for the day is that it is simple minded innumeracy to mistake a Very Big Number of profit as meaning an entity is particularly profitable as such, although this is a wonderful way to get naive provincial rubes to invest.

    You can profitably (haha) inform yourself on the concept of Profit Margin.

    You do like repeating what is in fact sheer bollocks…. (and idiotically navel gazing provincial bollocks).

  38. lounsbury says:

    @Moosebreath: As a proper point, one might say it posted a very large profit, but that does not make the firm extraordinarily profitable as such – a distinction quite meaningful and in no way theoretical if one has invested one’s own money into an entity.

  39. TJ Harrow says:

    @ernieyeball: Wrong. The “Make the economy scream” line was referring to destablizing Chile in order to help overthrow Salvador Allende the left wing democratically elected President of Chile. It succeeded and right wing dictator Pinochet overthrew him and took power. The same thing is happening now. While the US probably doesn’t expect Putin’s overthrow they undoubtedly have hopes for Venezuela & Iran.The US wants to weaken Russia, Iran & Venezuela. I’m sure their governments know that.

  40. grumpy realist says:

    @Jack: Considering that a) those taxes haven’t been raised in years and that’s how we get money to repair our roads, and b) none of those taxes price in the externalities of the CO2 emitted, we should be hiking it more. If we kept the price up at near $4/gallon we would see all sorts of incentive for better gas mileage which would make it far less painful when the price shoot back up again because we’ll have already developed the technology.

    (It also gives a poke in the snoot to the Saudis, which I always favour.)

    Our using hydrocarbons to burn is a stupid waste of some lovely long polycarbons that could be used for much better purposes elsewhere.

  41. HarvardLaw92 says:


    Who the hell is JB Williams, and why should I take his non-footnoted, non-sourced 9 year old blog posting seriously?

  42. HarvardLaw92 says:


    Nevermind. I answered my own question, here and here

    I should have known better than to ask …

  43. Slugger says:

    I am grateful to all drivers of Priuses and the legislators who passed CAFE laws way back when. As far as the Saudis go, after paying their prices, sacrificing our children in wars in Kuwait and Iraq, and kissing their behinds after they financed and planned the rise of AlQeida, I think they owe us a little price break.

  44. MBunge says:

    @lounsbury: Perhaps I should thank you for perfectly illustrating the dense innumeracy of being unable to distinguish between Large Numbers and relative numbers.

    And you seem unable to distinguish the difference between numbers on a page and numbers in real life. Or maybe I’m wrong. Who gets paid more, the CEO of Exxon or the CEO of Novartis?


  45. HarvardLaw92 says:


    The point is that ExxonMobil is a low margin business that just does a lot of business – in other words, it’s WalMart.

    Novartis is a smaller scale company that actually earns more in net income and per share than Exxon does ($9.175 billion on $58.831 billion in revenue versus Exxon’s $8.07 billion on $103.566 billion in revenue). – *2013 figures

    Then there’s the nasty stance that Switzerland has taken in recent years with regard to executive compensation, motivated primarily by Novartis’ compensation package for its then outgoing CEO, who earned pretty much the same as Tillerson and walked with a $78 million exit package.

    If anything, in terms of what value they generate for their shareholders, Tillerson is overpaid and Jimenez is a relative bargain.

  46. Tyrell says:

    @grumpy realist: Technology: think about this: electric conversion kits for most cars, hydrogen fuel cells that improve mpg by 50% or more, gas vapor engine gets 110 mpg (I saw one at a recent car show) how does that sound ? Jaguar re-introduces the turbine power. These are not some federal agency innovations, but the work of innovators, inventors, tinkerers, and engineers; working in basements, garages, and backyards. This is the way innovation will occur, not from the government or corporations. In the ’60’s Chrysler and GM built successful turbine powered cars. Then suddenly the plug was pulled and the companies got the cars back (probably under pressure from the government or big oil). Except some of the Chrysler cars were not returned and are still out there, safely tucked away.
    Higher gas prices and gas taxes ? No, that is not going to get it done.Neither will a flock of some government agency regulations, rules, and permits. Freedom to innovate, research, and create will.

  47. HarvardLaw92 says:


    None of those are really realistic mass-market propositions as long as gasoline is relatively cheap, and even then you’re much more likely to see a move to more economical ICE powered vehicles than you are a mass shift to alternative energy.

    To wit – the much vaunted Tesla, which despite all the hype, has managed to move fewer vehicles over the course of its entire existence than BMW alone moves in 3 months.

    Despite hybrids being widely and readily available, they make up (in environmentalist heaven SFO) less than 8% of vehicle registrations.

    Point being that these are, and will remain for the foreseeable future, niche products. People will shift to them en masse when they have no alternative, not before.

    For one reason – consumers like internal combustion.

  48. bill says:

    i guess the “drill baby drill” thing was spot on after all? how else could the saudi’s hand be forced if they weren’t thrown a bit of competition? i heard they were also in debt, not by our standards but really, how could a country that’s awash in easily attainable oil be in debt? all those families on the public dole must be getting serious amounts of cash to not work.

  49. ernieyeball says:

    @Tyrell:..Then suddenly the plug was pulled and the companies got the cars back (probably under pressure from the government or big oil). Except some of the Chrysler cars were not returned and are still out there, safely tucked away.

    What is your evidence that the government or big oil influenced this decision?
    Apparently Jay Leno has one. Since you seem to know, where are the others “tucked away?”

  50. HarvardLaw92 says:


    Saudi has external debt of 2.68% of GDP, much of which is due to it being cheaper to borrow the money to fund infrastructure projects rather than fund them out of currency reserves or revenues. It’s not remotely problematic.

    The bottom line is that they can probably (i.e. definitely …) hold out longer than the shale oil folks can, so they’ll win this one.

  51. Tyrell says:

    @HarvardLaw92: One selling point for electric is the virtually maintenance free motors: no messy oil changes, coolant, spark plugs, and other components to constantly replace or repair. And the reliabilty: they go on and on.

  52. HarvardLaw92 says:


    And yet, even with massive government subsidies, they still represent a tiny fraction (less than 1%) of US domestic auto sales.

    Like I said, they are a niche product. One day, far in the future, when the oil runs out or gets seriously actually expensive, people may consider making the move, but for the foreseeable future, no dice.

  53. wr says:

    @Jack: And the really hilarious thing is that Jack thinks he’s clever!

  54. wr says:

    @HarvardLaw92: “The point is that ExxonMobil is a low margin business that just does a lot of business – in other words, it’s WalMart.”

    Which makes it a tremendously powerful economic and political force, with the ability to get pretty much whatever it wants from governments, including ours.

    This, I believe, is the point that those who speak of “extraordinarily profitable” are pointing to. While you are undoubtedly technically correct, you are arguing a point of semantics while your opponent is arguing something completely different… which is the kind of pointless argument that goes on forever on a blog.

    So if I may: Your point it taken. His point is taken. We all get what you’re both saying and many of us agree with both of you.

    Can we move on?

  55. HarvardLaw92 says:


    I looked back over the conversation, and I didn’t really see any reference to political power. I saw a semantic argument over the difference between magnitude of profit and percentage of profit. That said, point taken. It’s quibbling.

  56. Guarneri says:


    Your efforts are appreciated. However if you spend much time here you will find that financial insight, even if as rudimentary as margins vs absolute (pick your currency) is rare. All the more so if you are dealing with Clavin.

  57. Guarneri says:


    Good candidate for dumbest comment in the thread.

  58. Guarneri says:


    Nice attempt at throwing a lifeline to a drowning man. Clavin was clueless and one hopes you know that lest you self identify as same.

  59. Guarneri says:

    In summary..

    In the face of weakening demand, The cartel is having a cat fight and engaging in a game of chicken to maintain share, with US producers squarely in the sights of the Saudis. Remember, in commodity markets small swings in supply or demand cause outsized price changes.

    The Saudis will win in a route.

    Electric and hybrid vehicles remain tiny share, niche options for probably the lifetimes of all commenters here.

    Oil companies generate relatively modest profit margins, as do most low value ad extraction businesses. The risk adjusted returns are probably worse. These observations are separate from lobbying clout.

    Oil company conspiracy theorists need to get in line with birthers and Bush blew up the Twin Towers types.

    Absolutely no one knows when or at what level oil prices will find an “equilibrium.” One can note, however, that rig counts are already falling and USA shalers are levered. It could be more rapid than expected by most.

  60. lounsbury says:

    Numbers in real life? What the bloody f**k does that mean? The pay of a CEO has rather little to do with the question of an industry’s profitability. Indeed, likely far far too little. Jaysus you are stupid.

    @Guarneri: Very well stated.

    @HarvardLaw92: Quite right.

    It is not a point of semantics you dim sod, it is a fundamental economic point that if one does not properly understand it, can lead to staggeringly bad policy that would seriously harm an economy and most certainly energy production. Economic innumeracy is what leads to Zimbawean (as well as to throw you an ideological crumb, supply side economics) policy.

    Bad policy blasting a hole in already weak profitability of extraction firms leads to under-investment in exploration, development and more efficient processing. Not in the least theoretical concerns, one sees this again and again in the context of state owned extraction firms being used as cash cows (by innumerate policy makers unable to understand relative profitability or investment: see Venezuela notably) or equally in government licensing reactions to price movements (see just about any illiberal country relative to mining concessions and policy). This is not to claim extraction firms are wonderfully moral entities or run by warm cuddly people – they are not – however not understanding their real economics and getting dazzled in an innumerate fashion by Big Numbers (like my five year being excited by having 5 Monies!!!! because five is big!) as ‘reality’ (in fact not real reality) hurts everyone.

    There is a vast difference between size and profitability, and yes Big Firms (like all big entities) have weight to throw around, quite irrespective of their profitability. Very Large but not very profitable firms certainly have massive influence,

    The real problem in these discussions is that 90% of all commentary is the commentary of Resentment – as energy is fundamental people engage in quite magical thinking about it wishing for things at once self-contradictory economically as well as physically. This is not a particular disease of Left or Right, but of Economic Innumeracy and general human tendency to be whinging illogical c*nts.

  61. Grumpy Realist says:

    @Tyrell: dude, learn some economics. If you want to nudge people away from using X, you make its price high, so people find alternatives to it. What impelled the development of cars like the Prius is the high cost of gas in Japan. Fuel cells for cars are economically inefficient for cars because of the cost of noble metals needed as catalysts.

  62. Dave D says:

    @Tyrell: Are you trying to say electric motors don’t need lubrication (oil) or that they don’t generate heat to do work and therefore don’t need coolant? Perhaps you should learn about how that electricity is converted to mechanical work in the case of these engines. As with any machine with moving parts lubrication and coolant are important,

  63. grumpy realist says:

    @Tyrell: Um, have you thought about what you said? I hope you’re not thinking that an electric car doesn’t have moving parts, because they bloody well do. Otherwise how are you going to have the wheels turn? That the motor doesn’t need as much lubrication or coolant as an ICE, yes, that I will agree with.

    The major problem holding back electric cars is a) the battery technology (you want to have deep duty cycles for an almost infinite number of cycles) b) the cost of said battery technology, and c) the time to recharge.

    (My business partner made the comment today in exasperation that “American civilization comes to a standstill with 2 inches of slush on the roads designed for the most advanced automobiles in human history.” Washington, D.C. does not know what to do with snow, and in fact, gets all indignant when it falls.)

  64. michael reynolds says:

    BTW and a bit off-topic, I’m apparently not the only one concerned that ISIS would make a cross-border move on the KSA:

    When a raiding party from Islamic State of Iraq and the Levant attacked a Saudi border post last week, it was no mere hit on a desert outpost.

    The jihadists were launching an assault on the new, highest profile effort by Saudi Arabia to insulate itself from the chaos engulfing its neighbours.

    The Saudis are building a 600-mile-long “Great Wall” – a combined fence and ditch – to separates the country from Iraq to the north.

    Much of the area on the Iraqi side is now controlled by Isil, which regards the ultimate capture of Saudi Arabia, home to the “Two Holy Mosques” of Mecca and Medina, as a key goal.

    Apparently ISIL and the Kingdom agree that their winning move would be against one or both of the holy sites. I don’t think that’s likely anymore, I think ISIS is in trouble. But if no longer capable of a cross-border move they remain potentially capable of infiltration and a major terrorist attack.

  65. lounsbury says:

    @michael reynolds: Fair follow-up and you’re right on calling me on the dismissal some months back.

    I was probably too strong – however I do not think that there was ever a realistic scenario (as I recall our convo) of DAESH rolling down into KSA à la their initial Iraqi blitzkrieg.

    Nevertheless, the possibility of a lightening raid to temporarily capture one or both of the Haramain (and possibly incite a intra-Saudi / intra Wahhabite civil war is something I dismissed implicitly and I will cop to doing so too rapidly.

  66. lounsbury says:

    @Dave D: Magical thinking mate, magical thinking. Rather typical of the Green Left. A pity really, as such magical thinking rather undermines bloody necessary green development and gives your lunatic Global Warming deniers on your Bolshy Right a hook to hang their hats on.

  67. Tyrell says:

    @Grumpy Realist: But the alternative, ev and hydrogen, are also expensive compared to conventional cars. Even an ev Focus runs a lot more. That and battery range keeps people away. If they could make some big progress on battery charge range more people would buy. I will look closely at an ev next go around, but it will have to be $20,000 or less. I would try a diy conversion kit if I had the tools and mechanical skill. People will still need a conventional car for trips, such my ten hour trip to Florida. Trains ? A joke. Buses ? Ok for schools, but not for me. Air ? It continues to deteriorate in terms of comfort and convenience compared to price. I am also going to look at the gas vapor engine concept. Bio-diesel is also worth a look. Jaguar is using a turbine concept. I wish the car companies would take another look at the turbine. With today’s technology, a smaller, more efficient turbine engine could be successful. This was tried in the ’60’s but was ended abruptly for unknown reasons. A turbine car came close to winning the Indianapolis 500 – twice. Turbines have few moving parts.

  68. michael reynolds says:



    I’m left a bit speechless by someone on the internet offering an honest and nuanced re-assessment of their position. It’s like some parallel universe where grown-ups have rational conversations. It’s unsettling.

  69. grumpy realist says:

    @Tyrell: Go check and see what Solectrica is doing. They used to provide conversion kits for the Geo Metro.

    I’d be suspicious of anything that claims to get incredibly higher efficiency from a “gas vapor” engine. How do you think ICEs work, especially the present generation ones? The only place I’ve seen gas vapor technology talked about is by the same guys who mutter about vapor trails and Tesla earthquake machines.

    The problem with electricity storage via batteries is that the battery materials are usually pretty expensive (especially the ones demanding transition elements). One of the reason that lead-acid batteries are still around in automobiles is a) they’re cheap, and b) you can run an incredible number of cycles on them without a problem. The difficulty is that they’re heavy and thus provide limited range for their weight.

    The real divas of the alternate energy transportation world are solar cars (expensive, touchy, and prone to making loud noises when things go wrong.)

  70. wr says:

    @lounsbury: “It is not a point of semantics you dim sod, it is a fundamental economic point that if one does not properly understand it, can lead to staggeringly bad policy that would seriously harm an economy and most certainly energy production. Economic innumeracy is what leads to Zimbawean (as well as to throw you an ideological crumb, supply side economics) policy.’

    It’s extremely unlikely that any point, fundamental or not, which is not properly understood in an argument on this site is going to lead to any kind of policy, let alone a Zimbabweab meltdown. My message, which was unwaveringly polite as opposed to your blind vituperation, was that there was a petty argument over a semantic point going back and forth and boring the hell out of everyone here. I was hoping you could decide you had made your point and move on to something that we hadn’t already read fifteen times.

    I’m sorry if it bother you when someone is wrong on the internet. That you feel it justifies you in flinging around unwarranted insults tells me a lot more about you than it wounds me to have you call me “dim” — especially since you are railing against someone who didn’t take either side in your petty bickering.

  71. Tyrell says:

    @grumpy realist: snow: same thing around here. Two inches forecast creates a run on stores and people buy up enough bread and milk to last two weeks! Of course the schools close. That is for various reasons, mostly liability. But school buses don’t have big problems going through snow. Around here few if any snow plows. No use putting out a huge expense for something that gets used about every seven years on average for maybe a day or two. People are more laid back here than in D.C.
    The permanent magnet motor is interesting: a motor that runs entirely on magnetic power. I have also wondered if liquid oxygen or gas plasma would be a practical fuel.

  72. Just 'nutha says:

    @HarvardLaw92: “Intellectual Conservative” (heh)

    That’s so cute.

  73. Just 'nutha says:

    @Tyrell: Ummmm…You DO know what the replacement and or disposal cost for an electric car battery is, right?

  74. SC_Birdflyte says:

    While the short-term and medium-term benefits of cheap oil are undeniable, any attempt to implement sound energy policies gets thwarted by our human tendency to over-react to short-term stimuli. Oil prices spiking to new levels? Whine about it. Oil prices dropping by 50% in six months? Oh boy – let’s go out and buy that Suburban we’ve always wanted. The (short-term) price movements of oil are a weak reed on which to base energy policy.

  75. grumpy realist says:

    @Tyrell: No. There is NO SUCH THING as a motor which runs completely on magnetic power. Those fall in the realm of perpetual motion machines.

    This is the problem when you get your scientific knowledge off the wilder sites on the web and the ads in the back pages of Popular Mechanics.