Saturday, April 09, 2005

IMF - Oil price will remain high

In a recent report IMF acknowledges that the Oil price will remain high. The IMF report doesn't however seem to acknowledge the uncertainty that China's oil consumption will grow exponentially when certain income levels are met (see my blog: Criticial Uncertainties in the Oil forecasts.

In the report IMF are forecasting a sustained oil price at levels between $69 and $97 in 2030. The message to the world is of course to adjust to these new levels.

One of the really big question marks is how and when George W. Bush will react and what measures he will take. In a critical article in NY Times (free registration required> Thomas L. Friedman asks the relevant question:

How will future historians explain it? How will they possibly explain why President George W. Bush decided to ignore the energy crisis staring us in the face and chose instead to spend all his electoral capital on a futile effort to undo the New Deal, by partially privatizing Social Security? We are, quite simply, witnessing one of the greatest examples of misplaced priorities in the history of the U.S. presidency.

This article spread quickly in the world, which only underscores it's relevance.

Will the IMF report be a mile stone in the process to change the American mindset towards a new relation to oil?

Read about the report in an article in International Herald Tribune.

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