Working with prices

"The strongest principle of growth lies in human choice". (G. Elliot)

We usually find in the News many extravagants theories about the oil price formation. But the essential premise is the offer/demand game. The extracting and storage oil is expensive. If you don't have orders you don't extract more. Being true the main premise you can add later political and economical analysis to cook the value.  But most part of the time we have more o less a similar scenery between changes. 

In my opinion there are also confusion between targets in no producers countries. The renewable and nuclear energy has to reduce gas or coal imports or consumptions. And the oil has to maintain basically the necessities of transport. 

As soon as the countries reduce their dependence of gas or coal to produce electricity and heat by mean of renewables and nuclear, as soon we could stabilize the gas prices. As soon as the car industry replace the actual engines for hydrogen or electric hybrid systems, as soon we can stabilize the oil prices. Oil and gas are not a long term ressource for being investing this nightmare of money on it. In 20-30 years we have to live for the rest of our existence with small productions for chemical industry (10-20 m/b/d), if vessels and planes would found other alternatives. For me, as part of this industry, money is welcome. But we have to be ready to cut gradually this critical dependence. And higher prices are showing that we are not doing the right thing or more specifically at the right timing.

Instead of starting big plans for alternatives they invest enormous amounts in future oil and gas explorations. Thanks at least for being so constant. But the key for changing the price tendency is on their hands. The Opec, Russia and other producers should not have to pay for your lack of investing consistence. They only know that future extraction is by far more expensive than before and you have to pay the price of your choice. The oil and gas producers are not denying you from developing nuclear energy or developing at higher speed your renewable plan or reducing diesel dependence.  They have to save from this prices an important part for when you don't need more, to convert again their economies in other specialization to survive.

And of course whenever the investments of this sovereign funds become serious. Looking at the Norwegian Fundinvestment, among others titles, they invest in beer, football teams and porno stocks, a kind of joke difficult and hard to understand. The yield to obtain don't justify this stupid mix with the industrial effort, the local landscape impact and the blood of many workers. The Fund administrators claim that they don't invest in companies under suspicion of children labor abuse. According to those talented gentlemen, investing in Playboy TV channels is the alternative. Heroes!