Richard Heinberg: Hurricane destroys oil infrastructure; oil price falls

Sometimes you just have to stand in awe and wonder before the all-knowing wisdom of The Market. Common sense would say: Hurricane Gustav (even considering the fact that it never achieved its advertised category 4 status before landfall) is likely to result in 40% of US Gulf of Mexico oil production being taken off-line for 30 days, with longer outages for some rigs, terminals, and refineries; therefore, given the fact that fuel supplies in the US are already tight, this is a good time to load up on oil futures.

But Noooooo. That


This tells us just how important the market and price signals are in helping us prepare for the inevitable decline in world oil production. To wit: not very.

When the oil price was above $140 and commentators were forecasting a continuing spike up past $200, it was easy for Peak Oilers to feel vindicated and to hop on board the giddy Ferris wheel ride. Newspapers, television, NPR