“At the world climate change summit, few delegates paid attention to the tale of oil's inevitable demise” writes Jeremy Leggett of The Guardian.

Of particular interest:

Here is the bottom line. At oil prices below around $70 a barrel, producing oil becomes uneconomic in many settings today. With the oil price where it currently languishes, at less than $50 a barrel – in a market where pricing has become completely disconnected from "fundamentals" by the volume of paper trading – oil development and exploration projects are being cancelled around the world on a daily basis. How on earth is the industry going to [produce enough to meet global projected demands?]

… the world needs a "clean energy new deal", as the IEA [International Energy Agency] is calling it. Insurance must be taken out, via clean energy, in case the oil industry fails to meet projected demand. The perils of climate change require such a course of action anyway. So too does the rebuilding of economies made necessary by the financial crisis. It all makes sense in a win-win-win sort of way.

… "There's a real risk that this thing could collapse," [an IEA official] said. He meant the operating model for the world's energy markets. Where financial markets can go today, in other words, so can energy markets tomorrow. (my emphasis)

Read the full article here.

Thanks to Bob Jacobson for this link.