Branson warns of oil crunch within five years.

[injuneer]

There is still plenty of oil about but it is becoming increasingly difficult to extract it, in some cases it costs more to get it out than the price it will fetch, which is madness. Many geologists in the oil industry believe we have reached the peak. From now on demand will begin to outstrip supply especially with the likes of China & India needing more & more. China's level of car ownership is expected to exceed that of the USA by 2017.

An ex-girlfriend of mine (she was from Bergen) has several relatives who work for Statoil. When I went over to visit her I got to spend some time having interesting talks with some of them. The way it was explained was that the easy to find oil (North Sea, Texas, Arabia, Russia) will be the first to be pumped to the point that potential profit, and the cost to pump oil will narrow to the point that its no longer financially viable to continue working an oilfield. Even though there may be hundreds of millions of barrels of oil left under the North Sea. Sooner or later the oil companies wont make enough profit to keep pumping the oil. Once the easy oil is profitably pumped, then the oil companies will have to start drilling and pumping oil from more remote area. Thus driving up the price of oil even further.

Oh, and a final thought.... If our government had a financial strategy that worked, all you drivers wouldn't be paying in excess of 55 pence duty per liter of petrol/diesel on the garage forecourt....

[chris9991]

One thing that may be a factor are the actions of same state, such as China, prepared to invest and form partnerships with nations in Africa and South America that have access to raw materials including oil.

If that oil doesn't hit the open market, then that which does will be of a tighter supply which would imply an increase in the trading price