Oil prices continue to drop, are now below $50
Now this is … strange ? odd ? bizarre ? weird ? I was reporting in October that oil prices had dropped below $90, but last week they went even lower with as little as $50 a barrel. This is a 55% drop compared to last June.
Back to 2008, oil prices reached $147 before tumbling down to levels around $50. They remained around $100 for months and years : oil prices were slowly getting higher and higher and there was no end in sight for this phenomenon. And then it happened : global oil demand stopped increasing as demand decreased in China and Europe.
Here is a graph from NASDAQ showing what is taking place :
At such low prices, extreme oil is, exactly as I wrote six years earlier, not interesting nor good business as prices of $80 to $100 a barrel are needed to be financially viable and bring return on investment. Bloomberg explains why quite clearly.
All this makes more and more people think that now is the time for a carbon tax. The Washington Post and Forbes published recently articles urging for such a move. This would be a fantastic event, climate wise.