The oil companies' staggering profits are a windfall of the purest sort (Websters' definition: "an unexpected, unearned, or sudden gain or advantage"). This is not a moral judgment about the oil companies, it is just a description of what's happening. A windfall profits tax could generate substantial government revenues. Allocated to investment in renewable energy, it could significantly increase funds directed to renewables, and be a small but important down payment on the massive investment needed in mass transit, energy efficiency and renewable energy...

Re-regulating energy markets, imposing margin requirements and lessening investors' ability to trade with borrowed money, and cracking down on market manipulation will all slow the Wall Street frenzy and limit price spikes. For the long term, however, oil demand will continue to shoot up and supply cannot keep up. Ultimately, new sources of oil may become available, including from deep water sites and tar sands and shale, but these will be more expensive to obtain. The world is likely witnessing a long-term, steady (if bumpy) and permanent rise in oil prices. This price increase will impose major economic hardships, unless there is a massive effort to shift to oil-displacing technologies and renewable energy. [More] . . read more

There are other factors affecting the price of oil. The prospect of an Israeli/U.S. attack on Iran has increased current demand in order to build stocks against disruption. No one knows the consequence of such an ill-conceived act of aggression, and the uncertainty pushes up the price of oil as the entire Middle East could be engulfed in conflagration...

The crisis that looms for the U.S. is the loss of world currency role. Once the dollar loses that role, the U.S. government will not be able to finance its operations by borrowing abroad, and foreigners will cease to finance the massive U.S. trade deficit. This crisis will eliminate the U.S. as a world power. [More]

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. . . read more

A major flaw of Peak Oil is that it is based on a static, or technology-neutral, assumption: it implicitly assumes that limits to oil are set as natural, innate, and immutable. Yet, limits to oil, like those to most other resources, are determined as much (if not more) socially as they are naturally. Research, development, and technological advances have made (and will continue to make) both the amounts of oil reserves and of oil production much more fluid or elastic than perceived by the champions of Peak Oil.

Another equally-flawed proposition of Peak Oil is that it implicitly views the limits of oil supply independent of substitutes or alternative sources of energy. These include solar, wind, non-food bio-fuel, and nuclear energies. They also include natural gas. Further, they include “unconventional” oil: Tar Sands, Heavy Oils, and Oil Shale. Although, with the exception of natural gas and nuclear technology, the use of these substitutes is sill quite expensive, and therefore, limited, technological advances are bound to reduce their cost and increase their sue. [More] . . read more

The major price determinant has moved from OPEC (having only 40% of the world production) and the oil companies to the speculators in the commodities markets. What goes on in the essentially unregulated NYMEX — and, unlike your personal purchases, untaxed — is now the place that leads to your skyrocketing gasoline bills. OPEC and the Big Oil companies reap the benefits and say that it’s not their doing, but that of the speculators. Gives new meaning to "passing the buck"...

A sane government would see the present price crises as an opportunity to expand our passenger and freight railroad capacity and technology. A sane government would drop all subsidies and tax loopholes for Big Oil’s huge profits and other fossil fuels and promote a national mission to solarize our economy to achieve major savings from energy conservation technology, retrofitting buildings, and upgrading efficiency standards for motor vehicles, home appliances, industrial engines and electric generating plants. [More] . . read more