Rob Sanheim

Oil's Slippery Slope: Why Crude and Oil Stocks May Be Headed Down, Fast

First - the small steps that some people are taking to cut their use of oil is really a tiny drop in the bucket compared to what is needed. Maybe if gas were $10/gal we'd see car and van pooling, mass transit, and thermostats at 60 in winter. As it is, I see most people buying a few compact flourescant lights and _maybe_ buying a mid size sedan instead of an Escalade.

Second - even if Americans were ready to make drastic changes to their lifestyle, what would it matter if Iran really did cut its oil supply? The price of just about every necessity would explode, and it wouldn't matter much how little John Doe drives if his grocery bill and heating bill is 3x as much.

Third - we know that there doesn't need to be an actual cut in supply to see it shock the world economy. All it takes is threat of a cut in supply or maybe a terrorist attack on Ghawar to send the price to new heights. If the US was actually burning through its reserves, can you imagine the resulting panic? No drilling in ANWR or Alberta oil shale would be able to take up the our slack and that of India, China, Japan, etc...