charles hugh smith–The Oil Head-Fake: The Illusion that Lower Oil Prices Are Positive

We have entered an era of lose/lose–a totally unimaginable prospect for those who have been immersed in the true cult of the past 150 years, the religion of perpetual material progress. The environmental movement is marching to the tunes of the authoritarian globalists, though they do not have a clue. But that is, of course, what propaganda is supposed to do. If you know what it is and why it is there, it no longer serves its purpose.

The earth and all of its inhabitants ultimately plays to one immutable tune, the symphony of the Laws of Thermodynamics as applied to closed systems. Unless we quickly learn to harness the energy of the sun efficiently and far more cost effectively, humankind’s material fate is tied to the extraction price of carbon, not just its abundance or lack thereof.  

What the environmental movement does not seem to understand is that by allowing State governments and the United Nations to radically increase their respective authority over the productive capacity of every industrial enterprise down to the allowable behavior of very single one of us formerly free individuals, they are accelerating the process of total government tyranny.

The less than humorous aspect to this, is that the self-regulating homeostasis of the absurdly over burdened, consume it forward, debt riddled global economy, along with the cleansing mechanisms of the marketplace are about to take care of the excess carbon footprint on its very own, freely, more equitably and without prejudice. I have a feeling the elite powers that be may already know this and this set up is one of the most amazing feats of propaganda facilitated mass human manipulation ever induced.  The end game is power and wealth. As it always has been and always will be–if we, the sovereign citizens allow it.

oil-headfake9-14The essence of the Oil Head-Fake Dynamic is the inevitable drop in oil price due to global recession will trigger disruption of the global oil supply chain.

I’ve described the dynamic of structural imbalances of supply and demand leading to lower prices for crude oil as the Oil Head-Fake: high global production (supply) continues while demand declines due to global recession, and the resulting imbalance of supply and demand triggers a major decline in price. But this drop is not positive; it’s a temporary response that triggers a variety of disruptive consequences.

There’s nothing fancy about a basic supply-demand pricing model; if the world is awash in crude oil and demand slides, price will eventually follow.

[gview file=””]

via charles hugh smith-Weblog and Essays.