Originally Posted by
birmingham
The economics are a challenge if the aircraft isn't filled and fuel prices are low. So airline managers (largely risk averse, systematised creatures these days) have generally given it a wide berth. If oil goes back above $100.....
Very unlikely. Texas
by itself is scheduled to become the world's number 3 producer of oil by 2019. The Permian Basin (west Texas) is growing very fast with oil that is profitable at $40 per barrel. The biggest constraint in the Permian is pipe capacity, and there are a number of pipelines scheduled to come on line soon. The Eagle Ford (south Texas) has even more oil than the Permian and is only slightly more expensive to drill and pump, with the costs going steadily down. Eagle Ford is in the early development stages relative to Permian, so over time there will be more and more oil available. OPEC can no longer control the price of oil and their ability to do so will only decrease over time. And that's just Texas. There is LOTS more oil in other states as well as Canada. And Trump has authorized that pipeline from Canada to the Texas coast that Obama killed.
The demand for oil is rising steadily. But the supply is rising faster. That means steady or declining prices.