Chicken: The Sky is Falling! Maybe. Is it?

I was taught that if a thing seems too good to be true it probably is.  Cheap gas seems to fall squarely into that category. It seems unnatural.  Then again, I am a chicken.  I’m genetically wired to alert the masses when the sky is falling.  Or at least when I THINK it is falling.  Perhaps I only need someone to explain to me-in plain language, thanks-how cheap gas is a positive, not unnatural, trend.

Seriously, what happened in the world to justify a 60% drop in the per barrel price of crude oil over the course of several months?  Was a new mega source discovered? Did the members of OPEC skype one morning and decide to hold a clearance sale on all the dusty barrels in their warehouses?

By most accounts, there is an abundance of supply driving down the price.  However, according to the general press, some members of OPEC, such as Venezuela and Iran, are desperate for the price of oil to turn around.  They and other countries, most likely including the US, were counting on Saudi Arabia to cut back on production, as they have done in the past, to stabilize prices.  The Saudis aren’t cooperating.

One factor affecting the supply/demand equation of oil is the efforts of America and other countries to become less reliant on foreign oil.  Not only are we Americans looking for our own oil via fracking and horizontal drilling, we’re also developing and using alternatives to oil, like solar panels and wind energy.  And don’t underestimate our efforts to just cut back.  We are, some of us, evolving into conscientious consumers. The Crown Prince and his brothers and all their brothers-in-law, and nephews and cousins, they don’t like that shit. But what can they do? They can’t MAKE us buy their oil.  They can’t kidnap us and shoot us up with crude oil until we’re addicted.  So how can they increase our reliance on foreign oil?  “I know, I know”, one bright shiny prince might have called out, his arm waving above a sea of other royal princes, or so I imagine, “We can let the price bottom out!”.  At first, perhaps, they laughed, all the older, wiser sheikhs, because, clearly, the price of oil can’t go lower if they are to get richer.  But then, maybe, they saw that the little prince was correct. Why should they have to always be the ones to cut production?  Why not let other countries share the burden?  You have to admit, they have a point.

Some sources predict that Saudi Arabia is in a position to weather the storm while eliminating competition, while other countries, like Iran and Venezuela, and even bigger countries, like Russia and the United States, are likely to endure serious consequences.  This is because each operation has a number which represents the average cost of producing a barrel of oil.  If the price of crude oil consistently slips below their number, companies can’t turn a profit.  If they can’t turn a profit, they can’t maintain their operations and pay their debts.  If they can’t maintain their operations and pay their debts, their loans go into default, and if that happens, their investors will suffer. And investors don’t like that shit.  In America, many operations reportedly carry huge debt loads.  Who are their investors? Mostly banks? The government?  The public?  Who?  What will happen when the investors suffer?  For certain, operations will shut down and people will lose jobs. If enough go out of business, a shortage of oil will result. If there’s a shortage of oil, the price will go up.  And up.  And if investors are losing money, people are losing jobs, and economies are becoming unstable, won’t that be the worst possible timing?

As if this isn’t anxiety inducing enough for a mentally fragile hen, I have another unresolved issue. Fracking sounds horrible for the environment.  If a bunch of fracking operations get shut down, is that really a bad thing?  Are the jobs of some worth the wear and tear on the environment we all share?  Are there other ways those jobs could be replaced? And I’d also like to know, while we’re at it, if the situation is being downplayed because the President vowed to reduce unemployment and our dependence on foreign oil?  Taken at face value, that does seem to be happening.  Is it happening really?  Or Is the tail wagging the dog?  Politics is such a wormhole that it seems impossible to drill down to the bottom of any issue and find a clear choice.  I guess you need to decide what’s most important to you and make your stand based on those ideals. What do you think?  Is the sky falling?  Are we fracked?  Or should I buy an RV and enjoy the oil industry’s limbo party while it lasts?

Chicken out

  14 comments for “Chicken: The Sky is Falling! Maybe. Is it?

  1. Jo H.
    February 11, 2015 at 7:20 pm


    Sorry to be yelly, but it’s good to see you!

    What I think is that oil and the recovery of it (including fracking) is bad for the future of our entire earth, and that the jobs in the fossil fuel industries will eventually have to be replaced by jobs in sustainable energy industries. And I think that can be done, successfully, from an economic point of view. But it requires political and individual will. That will be the tricky part. And by the time we have enough will to leave oil and its brethren in the ground, it may be too late.

    Too pessimistic? I’m fun like that. It’s one reason I like lolcats, and Simon’s Cat videos on youtube, and eating chocolate – it takes my mind off the bad stuff.


    • jenny_o
      February 11, 2015 at 7:21 pm

      And holy cow, there I go using the wrong name again. It’s jenny_o here, Chicken!

      Liked by 1 person

      • February 11, 2015 at 7:41 pm

        I agree with you Jenny, but it’s probably more complicated than we know. I’m with you on the chocolate! Let’s just be happy and eat chocolate. Maybe in my new RV? My new solar powered RV?


  2. Doug in Oakland
    February 12, 2015 at 6:10 am

    I’ve missed you, Chicken.
    I agree with Jenny’s comment, and the way I understand it, the climate is already changing, so the longer we wait to do something about carbon emissions, the worse the changes will be. Also, you’re right about it being more complicated. Fracking, as it’s being done in the US, is environmentally harmful, but the cheaper, more plentiful natural gas it produces has caused a shift away from coal-fired power and the mountaintop removal that feeds it.
    I just hope the cheaper gas doesn’t lull the electorate into believing we can keep doing what we’re doing and things will be just fine.


    • February 12, 2015 at 11:52 am

      HI Doug, I’ve missed you, too. So you think that maybe trading off coal mining for shale fracking is still not ideal for the environment but it is an improvement over coal mining? The lesser of two evils? Have we moved away from coal mining? I think you are not saying that, just that there’s less demand for coal? You know what I’ve been hearing about lately? Water. In places where there’s not an abundance of water, they are looking into piping water from the Great Lakes, but those populations are saying, whoa, hold on a minute, Cowboy….it will be interesting to see how that plays out. Water…so benign, right, but then to put in pipelines and move it great distances. Doesn’t it seem like water should be one of those things you can create in a lab in the woods out back of your house? Why is it easier to create meth than water?


      • jenny_o
        February 12, 2015 at 5:42 pm

        Funny you should mention water in the same breath with fracking (well, approximately). Did you know that in western Canada, for one, the drinking water close to fracking sites has been turned into a gas/water combination that can be set alight as it’s coming from a hose or tap?

        Liked by 1 person

      • Doug in Oakland
        February 12, 2015 at 9:51 pm

        OK, you asked. It’s a matter of scale. I actually knew someone who made meth. He made in 8 pound batches, each of which was a complicated month-long ordeal. 8 pounds was enough, though,that he only had to make it twice a year. 8 pounds of water is one gallon. Make more sense now?
        Here in California, we pipe water all over the place. Our population is concentrated in the south, which is mostly desert, and our central valley is some of the most intensely cultivated land on the planet. So we steal water from our northern watersheds to cope with the demand. We are now in a drought, the likes of which no-one has ever seen. Even though the recent drenching rains have replenished some of our reservoirs, the boat docks in Lake Tahoe are all standing on dry land, and there is no snow pack to speak of. This has spawned a political fight over fracking, because frackers had previously won an exemption from regulations against contaminating sub-surface water below a certain depth (that nobody at the time thought we’d ever need or be able to access) and now that water is looking really good to farmers who can’t irrigate their crops. Ironically, the drilling technology that is now allowing us to access these deep aquifers comes from fracking.
        Coal is generally held to be our dirtiest and most destructive power source, so I think that less of it is better, but replacing it with another fossil fuel is not a permanent solution.


      • February 12, 2015 at 11:43 pm

        Doug, I had a feeling you might know someone who knows someone who made meth, but wow, you’ve pretty much experienced everything. I guess IS all about the scale regardless of what Meghan Trainor has to say about it. Wow, I didn’t really know that about CA. Has NPR heard about this? I’m guessing someone somewhere is going to come up with a way to convert ocean water, on a large scale, to fresh water. We should invest in that.


  3. February 12, 2015 at 1:23 pm

    Holy chicken, Chicken. I think you’re on to something.

    Welcome back, my friend. The blogosphere is so much writer-y with you in it.



    • February 12, 2015 at 1:38 pm

      Holy….Pearl? Yes, Holy Pearl! I like the sound of that. I’m always on to something. I never stand still, really. Thank you. It’s good to be back:-) You’re too kind. The blogosphere spheres right along just fine without me, but I am happier being a part of it, there’s no doubt.


  4. jenny_o
    February 12, 2015 at 7:18 pm

    In looking for the documentary I saw on this (which, as it turns out, is available only in Canada, sorry), I was reminded of the other fracking/water connection – massive amounts of water are used in fracking, and this is a concern for the future of our water as well.


  5. February 13, 2015 at 1:44 am

    Yours is among the most concise and cogent assessments of the political oil market I’ve read so far. When I try to see an end to the problem, involving a non-renewable resource, I can’t escape the vision of a ring of contentious countries watching a donkey-engine chugging in a hole.


    • February 13, 2015 at 2:22 am

      Hi Geo, thank you-that’s a big compliment. I was hoping you might have a Norma Photo that would clear up the entire issue once and for all:-)


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