Yes, oil could remain above USD 100 per barrel for years to come.
So what?
That is the question nobody seems particularly interested in asking.
Every time oil prices move upward, the headlines arrive right on schedule. The experts emerge from their burrows. Television studios fill with worried faces. Politicians perform elaborate rituals of concern. Economists produce charts. Activists blame oil companies. Oil companies blame geopolitics. Geopolitics blames history.
The entire circus springs into action.
And yet the central issue remains untouched.
What if the problem is not oil?
What if the problem is us?
For decades now we have been trying to wriggle our way out of something that was always inevitable.
A reckoning.
Not a sudden catastrophe. Not a Hollywood apocalypse. Not some dramatic event where the sky turns red and civilization explodes in a shower of sparks.
Something far more mundane.
Reality.
We have spent at least half a century building a system that increasingly depended on assumptions that could not survive forever.
Cheap credit.
Ever-growing debt.
Endless consumption.
Infinite expansion on a finite foundation.
The belief that complexity could forever outrun consequence.
And when cracks began to appear, we did what modern societies do best.
We muddled through.
When the first warnings emerged, we ignored them.
When the second warnings emerged, we redefined them.
When the third warnings emerged, we subsidized them.
Then came 2008.
If there was ever a moment when the game should have become obvious, that was it.
The financial crisis did not solve anything.
It merely revealed the machinery beneath the stage.
The answer to a debt crisis became more debt.
The answer to financial excess became greater financial excess.
The answer to structural weakness became monetary anesthesia on a scale previously unimaginable.
And because the immediate collapse was avoided, many convinced themselves that the underlying problems had somehow vanished.
They had not.
The bills remained on the table.
We simply moved them to a larger drawer.
Now the drawer is overflowing.
What we are witnessing today is not the beginning of a crisis.
It is the continuation of one.
A very long one.
A crisis of assumptions.
A crisis of incentives.
A crisis of systems that increasingly require extraordinary effort simply to remain standing.
The global economy has become like an aging aristocrat determined to maintain the appearance of wealth long after the family fortune has evaporated.
The mansion is still standing.
The servants are still employed.
The silverware still shines.
But behind the walls the roof leaks, the foundations crack, and every room is mortgaged three times over.
Appearances are expensive.
Reality eventually collects.
Which brings us back to oil.
Oil at USD 100 sounds terrifying to people who have forgotten history.
Correct for inflation and the picture changes rather dramatically.
Oil prices have been substantially higher in real terms within living memory.
Far higher.
Yet somehow civilization survived.
Airplanes still flew.
Factories still operated.
People still drove to work.
Life continued.
What has changed is not oil.
What has changed is the resilience of the systems surrounding it.
A healthy economy can tolerate expensive energy.
A sick economy cannot.
A healthy civilization absorbs shocks.
A brittle civilization shatters under pressures that would once have been considered routine.
That is why every increase in energy prices now feels existential.
Not because energy has become uniquely expensive.
But because everything else has become uniquely fragile.
We are watching a civilization discover that leverage works in both directions.
For decades we borrowed growth from the future.
Now the future wants repayment.
The most fascinating part is the psychology.
Human beings are remarkably unwilling to surrender illusions.
Even when reality has already rendered its verdict.
We cling to narratives.
We cling to expectations.
We cling to lifestyles.
We cling to assumptions about how the world ought to work.
Most of all, we cling to the hope that one more policy, one more stimulus package, one more election, one more technological miracle, one more quarter of growth, one more burst of liquidity, one more lucky break might somehow restore what has already been lost.
Anything for one more breath.
Anything for one more gasp of air.
Anything except accepting that the world is changing.
And not changing in ways that can simply be reversed.
That is the uncomfortable truth lurking beneath every discussion about oil prices.
The panic is rarely about the commodity itself.
It is about what the commodity reveals.
Oil functions like a stress test.
It exposes weakness.
It highlights inefficiency.
It punishes fantasy.
And fantasy has become one of the largest industries in the modern world.
We built economic models detached from physical reality.
We built financial systems detached from productive capacity.
We built political systems detached from accountability.
We built narratives detached from consequences.
Then we acted surprised when reality reintroduced itself.
As it always does.
The tragedy is that many people still believe this is temporary.
That normality is waiting just around the corner.
That if we can only survive the next crisis, things will return to the way they were.
But what if there is no return?
What if this is the return?
The return to a world where resources matter.
Where geography matters.
Where energy matters.
Where production matters.
Where consequences matter.
A world that previous generations would have recognized instantly.
The globalized dream was never free.
It was subsidized.
Subsidized by cheap energy.
Subsidized by stable trade routes.
Subsidized by geopolitical arrangements.
Subsidized by debt.
Subsidized by trust.
Most importantly, subsidized by the willingness of populations to continue funding systems whose costs were increasingly hidden from view.
That willingness is fading.
The subsidies are fading.
The illusion is fading.
And people do not mourn illusions gracefully.
They complain.
They rage.
They blame.
They demand.
They search desperately for villains.
Anyone except the mirror.
Meanwhile the fundamentals continue their patient work.
Oil remains oil.
Physics remains physics.
Reality remains reality.
And reality possesses one quality modern societies increasingly struggle to tolerate.
It does not negotiate.
So yes, oil may remain above USD 100 for years.
It may go higher.
It may not.
The number itself is almost beside the point.
The truly important question is why a price level that would once have been manageable now feels catastrophic.
The answer is not found in oil fields.
It is found in balance sheets.
In institutions.
In incentives.
In decades of accumulated distortions.
The oil market is merely delivering the message.
The economy is the patient.
And the diagnosis is considerably more serious than the symptoms.
But by all means, let us continue whining about oil.
I am sure that will be tremendously comforting when reality finally sends the next invoice.
And reality, unlike governments, always collects.
https://oilprice.com/Energy/Crude-Oil/Oil-Could-Stay-Above-100-for-Years-Analysts-Warn.html