Low oil prices today may be setting the world up for an oil shortage as early as 2016. Today we have just 2% more crude oil supply than demand and the price of gasoline in Texas is under $2.00 a gallon.
Hey Willie that "article" was written last year (Dec 2014) as a prediction of what will happen this year, but pretty much all of his predictions have turned out to be wrong.
At the time that article was written, Brent crude was at $60/bbl and he predicted the price would shoot up to $90/bbl by the end of this year, with break-even near $100/bbl. He also predicted that $60/bbl oil for six months would be "catastrophic" to shale (non-OPEC) producers. This will cause supply shortages and will drive up gasoline prices, he says.
But what actually happened this year... we have
more supply as compared to last year and demand is down; Brent crude has gone
down to $48 and many shale producers are still making money at this level.
And you can find $1.64/gallon gasoline in Lubbock, TX.
The U.S. Government (EIA) is
now predicting Brent crude to recover slightly to $55-$59/bbl in 2016 while gasoline prices will remain flat. They also predict that average oil prices won't go above $70/bbl through at least 2020.