Great blogg post by Mr RubinThe International Energy Agency may not have a solution but no one can accuse them of no longer understanding the gravity of the problem.
In their June report, the IEA warned that unless OPEC could increase production by at least 1.5 million barrels a day, world oil demand is going to surpass available supply during the second half of the year.
It means if there is not enough supply to match the 89 million barrels of oil the global economy is expected to burn every day, world oil prices have only one direction to go.
https://www.jeffrubinssmallerworld.com/2011/07/13/world-oil-markets-face-production-shortfall-in-second-half/
Still others will point to the use of the strategic reserves as nothing less than a macroeconomic stimulus measure akin to a tax cut, conveniently timed for an upcoming U.S. presidential campaign.
With the U.S. Federal Reserve Board’s quantitative easing and Washington’s fiscal stimulus winding down, will timely releases from strategic oil reserves become the new kid on the block in the Obama administration’s economic tool kit? But Washington may soon discover strategic oil reserves are a very dangerous instrument to use. It’s a lot easier to print money than it is to pump oil from the ground.
Other than the level of oil prices and the resulting weakness in oil consuming economies, what supply shock does the release redress?
There is no doubt the loss of Libyan production has made world oil markets even tighter but triple digit world oil prices aren’t really about supply shocks. They’re about the growing imbalance between ever-surging world oil demand and little-growing world oil supply. And that imbalance is becoming bigger all the time.
https://www.jeffrubinssmallerworld.com/2011/06/29/743/