Oil prices will rise as they have before

In response to Shannon Reardon’s May 7 column, “Our squandered pride and prosperity”.

I saw today on Facebook that the 3rd most read article in The Independent last year was Shannon Reardon’s “Our squandered pride and prosperity” (May 7).

Bad news is popular, I suppose, but I find it all a bit overdone and I think maybe Ms.Reardon is in the thrall of common bogey: if things are bad they will get worse. Time for a little cautious optimism. (And I know about heretical anti Dannyism and hubristic power entities etc. Nothing new under the sun.)

Things look bleak indeed, I suppose, but what if oil prices triple in, say, the next nine months?

“What’s he smoking?” you say. “Everyone knows what the forecast is for oil prices.”

Well, consider this: In 1999 oil prices were dipping below $10 a barrel and everyone knew they weren’t going up any time soon. Everyone, including The Economist magazine—which, on it’s March 6 cover proclaimed “Drowning in oil”—speculated that prices might go even lower, perhaps to $5 a barrel.

By December the price was above $25 and, in what must have been a pretty painful fall onto it’s own sword (pen), the Economist’s Dec. 16 issue proclaimed “We woz wrong”!

Oil will go back up and our finances will improve. The tendency of governments and individuals to spend like drunken sailors is universal and any predictions of a change in that behaviour probably won’t require a correction.

Dave Paddon (St.John’s)

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