{"id":55378,"date":"2020-10-19T06:59:19","date_gmt":"2020-10-19T11:59:19","guid":{"rendered":"https:\/\/olduvai.ca\/?p=55378"},"modified":"2020-10-19T06:59:19","modified_gmt":"2020-10-19T11:59:19","slug":"oil-and-the-changing-world-order","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=55378","title":{"rendered":"Oil and the Changing World Order"},"content":{"rendered":"
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OIL AND THE CHANGING WORLD ORDER<\/a><\/h3>\n<\/div>\n<\/div>\n
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U.S. oil inventories have fallen every week for two months yet WTI has averaged less than $40 per barrel since the end of August.\u00a0That is because oil has been re-priced and markets are unwilling to pay more for it.<\/p>\n

Those who expect a return to 2019 price levels acknowledge that the oil-demand recovery has stalled. They believe that this is because of Covid-19 and that things will return to normal once there is a vaccine.<\/p>\n

Perspective<\/strong><\/p>\n

\u201cI don\u2019t think the severity of this downturn has been well understood yet.\u201d<\/p>\n

\u2014Sophia Koropeckyj, Moody\u2019s Analytics<\/a><\/cite><\/p><\/blockquote>\n

What is happening to oil markets and to the global economy is not because of a virus. The virus greatly accelerated what was already happening. Things won\u2019t go back to normal when the virus ends. I wrote\u00a0that\u00a0<\/a>a month ago and nothing has happened since then to change my mind.<\/p>\n

The world is in a debt cycle that began fifty years ago. World orders change when debt cycles approach their end.\u00a0Ray Dalio<\/a>\u00a0has studied how and why world orders have changed over the last 1500 years. These are the requisites that changing world orders have in common:<\/p>\n