Looking Back at 2008… Predicting 2009

December 29, 2008 · Filed Under FuelClinic, Fuelishness!

What a year it was…

The year 2008 has been a real roller-coaster ride for most of us. Early in the year we saw sky-rocketing oil prices cripple economies already struggling with enormous debt and lousy financing decisions. For the first ten months of 2008 the future wide-spread adoption of alternative energy (anything besides oil) couldn’t appear more certain – with the debate centered on _which_ alternative energy will out-compete the rest.

Now at the end of 2008 oil prices appear to be in an uncontrolled free-fall with the bottom not yet found despite OPEC’s intentions, and everyone is wondering if we can still invest in expensive new-energy technologies at the same time we provide bail-outs and “bridge-loans” to major industries.

The spike and fall of oil prices in 2008 are truly of historic proportions. The resulting economic collapse has sent financial markets into crisis, which created a credit crisis that has sent the entire economy into a recession, possibly a global depression.

Consumers have learned that they really _can_ live without using as much as previously believed to be comfortable. Consumers world-wide have tightened their belts and made changes to their lifestyles that have reduced overall consumption.

So what to do about 2009?

We have high-hopes and soaring expectations of our young new President, hoping that he will somehow find a path for us out of the economic quagmire we’ve created. His new energy team of highly motivated global warming supporters will most likely work to cut carbon dioxide emissions, encourage wind and solar power, and seek to restrict new drilling for domestic oil supplies. The new President is historically a strong supporter of mid-west ethanol interests, and will probably work to protect and promote that industry. We hope that includes support of flex-fuel mandates to help build a viable market for cheap oil alternatives at the local gas stations around the world.

We will probably find the “bottom” of oil prices sometime soon as more of the OPEC pumping (it’s not really “production” is it?) cuts hit the world markets. These artificial supply restrictions will probably mean that oil is a little more scarce, and will help to drive up prices and profits for oil-pumping nations. Their goal is to find a “right” price-point, where oil is still too cheap for us to work actively to replace it, but still as profitable as possible to fund and strengthen their assorted national interests.

Reduced world-wide consumption is a double-edged sword and means that recovery from the recession will take longer and continue to hurt profit-margins for businesses – costing additional jobs, and at the same time creating new categories and types of jobs for those with “clean technology” experience.

Keep your seat belts fastened…