Peringatan untuk aku yang selalu lupa

سُوۡرَةُ آل عِمرَان

رَبَّنَا لَا تُزِغۡ قُلُوبَنَا بَعۡدَ إِذۡ هَدَيۡتَنَا وَهَبۡ لَنَا مِن لَّدُنكَ رَحۡمَةً‌ۚ إِنَّكَ أَنتَ ٱلۡوَهَّابُ

[3:8] (Mereka berdo'a): "Ya Tuhan kami, janganlah Engkau jadikan hati kami condong kepada kesesatan sesudah Engkau beri petunjuk kepada kami, dan karuniakanlah kepada kami rahmat dari sisi Engkau; karena sesungguhnya Engkau-lah Maha Pemberi (karunia)".

Wednesday, November 19, 2008

Will the oil price testing the USD40-USD50 levels?

Not long ago, I remember that there is a worried situation on the future of the oil prices and there are signs that some people beginning to panic and there has been the all doom and gloom scenario of the world due to peak oil and the aftermath of the peak oil. I was also one of those people affected by all the theories and predictions of the peak oil scenario. Despite some of the logical explanation relating to the speculation activies and despite some strong data pointing to the flaw in peak oil theory, it seems that the USD200 per barrel oil is coming soon. However, since oil reached the peak around USD147, its momentum has been halted and it has been falling fast and remind me of the falling of the oil price early in the 80's and also the tin price in the 80's...
Wow... that was arelief.. Now my monthly petrol expenses is being cut by 40%...
However, I am now more concern on those initiatives and measures of substituting oil or minimizing the dependency on oil. Are these initiatives will be continued or will it be discontinued due to the falling oil prices? Or those the falling oil prices has anything to do with these measures? Does the world now is ready to start reducing the dependency on oil by up to 30%? Or maybe more? I remember when tin crashes in the 80s, its factors includes the introduction of substitution material for tin and also to some extent, the discoveries of tin in other part of the world. If I am not mistaken, during the tin price crash, there has been a large new findings of tin ores in Brazil... Maybe this time around the discovery of big oil basins in Brazil also contributed to the falling oil prices?
Anyway, I really hope that the trend of falling oil prices can have a positive effect in off-settings the negative impact of the economic recessions. I just hope that the world can balance the supply-and-demand fundamentals and thus will lead to a more balance economic situation. I am actually a great believer in the "balance" theory... It is a same theory of the law of thermodynamics, basically in it simplest form can be understood as, when the temperatures of two matters are not in equilabirium, there will be some activity in the thermodynamic to equal the temperature until it become balance. I believe that perhaps the world economy is now having a scenario to reach or at least to swing into equilibirium...
But what will happen if the equilibirium is reached?
Well, although the theory will finally pushed the situation into a balance and stable state, but as we all know, there will always disturbance when an equilibirium is reached. I guessed, it will be determined greatly on the type of economics fundamentals and economics initiatives that will be adopted by the world and their governments. I believe the people can always adopt a more fundamental approach to the economy, maybe cutting on debts and credits and creating more positives and fundamental values to the economy. There has been some much gaps and differences between the rich and the poors and this situation maybe need to be re-adjusted, or there is a need to balance the situation... But the more critical questions is, how we can balance this situations? Well, perhaps, democratic capitalisme may not be the ideal choice for the solutions... Or maybe, democratic capitalism can be practice with a more emphasize in the development of the society and the focus on reducing poverty? Hmm.. that sounds like a more socialist approach..
Anyway, with the current trend in oil prices and with the world economy is in the middle of some sort of a crisis, I guess there is a chance that oil will dip further to below USD50 mark.... The markets still in a very unstable mode and maybe the oil prices movements itself is not certain whether it is being influenced by the fundamentals or perhaps by a negative trend in speculations? I guess the current situation in the world economy has giving an early indication of what to expect next.... based on previous experience, the economy slowdown may last about 2 to 5 years before rebounding backs in the driving mode... So, maybe this is the time to sit back and have some deep thoughts on the future 5 - 10 years planning....

No comments: