Industrialized Cyclist Notepad


Demand triage

Chris Nelder explains a critical dilemma facing American consumers. As total available oil exports decrease (at a rate that would bring them to absolute zero in about four years), inefficient westerners will be outbid by the new Asian “middle class” for these diminishing supplies.

Of course, exports can fall to zero in theory only, not in practice. In reality, high prices will kill the most inefficient, unsubsidized demand first—in the U.S. and Europe. Next, demand will be curbed in net exporting countries, first via the removal of domestic fuel subsidies, and then by world prices. The demand of the four billion people in Asia will be the last to go because they use it most efficiently.

via Oil demand shift: Asia takes over | SmartPlanet.

Translation: The fat gets trimmed. The fat is here.

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