The grim future of rising fuel prices

Crude oil surged briefly to near $132 a barrel this week. Who doubts even higher prices lie ahead?

Gasoline was right on its heels. Regular cracked $1.37 a litre some places in the Interior, averaging around $1.33 in Vancouver. Will this never end? No, it won’t. How does $2.50 a litre grab you?

That’s near the price already being paid in parts of Europe. Which raises another question: At what point can you no longer afford to drive?

News services reported this week that Deutsche Bank’s chief energy economist now warns there’s “a huge risk” price will just rise until demand collapses, possibly in the range of $250 a barrel or more.

It now seems likely that unless global oil supply increases sharply, prices may later this year reach the $200-a-barrel threshold for recession predicted by reputable analysts, even with more bio-fuels.

So, are we entering the period of price volatility that peak oil analysts warn will precede the decline of car-culture mobility we take for granted in North America? They forecast a wild cycle of price spikes and retreats that won’t follow normal market patterns.

Vancouver Sun