A realtor's view from Hubbert's Peak

The End of Cheap Oil and Cheap Money

Hubbert's Peak is the peak of global oil production as estimated by the fossil-fuel geologist W. King Hubbert. At this peak (which could take place in a few years) the world's oil drum, so to speak, will be half empty, with a lot of sludge and poor-quality oil at the bottom of the barrel. As the two-billion-plus Chinese and Indians increasingly drive cars rather than ride bicycles, the competition for the remaining resources will be intense. Oil prices will rise, and along with them transoceanic and transcontinental transport costs for goods of all kinds. Industrial agriculture, with its diesel-fueled tractors and irrigation pumps and its petroleum or natural-gas based fertilizers and pesticides, will no longer be producing cheap food. The petroleum-based plastics that are ubiquitous in today's world will suddenly no longer have a cheap feedstock for manufacturing.

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