Publications: The Petroleum Economics Monthly

$200 Crude, the Economic Crisis of 2020, and Policies to Prevent Catastrophe (April/May 2018)

The global economy will face collapse in twelve to eighteen months, a downturn worse than the Great Recession of 2008. What’s coming could even rival the Great Depression of the 1930s.

Catastrophically high oil prices will cause the impending recession. The world oil market will see prices at least double. The increase could be much larger. A price of $400 crude is not out of the question. US voters may go to the polls in November 2020 with gasoline and diesel selling for three to six times as much as in November 2016.

This looming economic crisis has not been anticipated to date by any major economic forecaster. No one has noted the coming high oil prices. No one has predicted the economic consequences. But then few foresaw prices doubling from $70 to $140 per barrel in 2008, and no forecaster predicted the Great Recession in January 2008.

The approaching economic troubles could be dodged, just as the Great Recession might have been avoided in early 2008 if Lehman Brothers had been saved. To borrow an analogy from history, the global economy today is moving toward an unseen calamity, just as the RMS Titanic sailed toward an iceberg in 1912. A minor course correction would have saved the Titanic. The looming economic ills could be avoided in the same manner.

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