Falling Oil Price To Cause Jump In Pollution

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Oil prices may be capped at $75. At least, that is what Bloomberg is reporting. Production by OPEC+, which is above expectation, married with a weak Chinese economy, could keep the price below that level through 2025.

Expensive oil usually increases the pace of a rotation to solar and wind, at least in some industries. However high interest rates have challenged funding for green companies in the early stages or those wanting to grow. As green energy projects lag, cheap oil becomes more and more attractive. Also, oil-based energy continues to be a primary cause of greenhouse gas emissions.

Add to OPEC+ the rise in crude production in the US. In December, the US produced more oil in a month than any nation in history. What was once an oil-starved nation is now the largest producer. Shale has driven most of this increase. M&A is financially strengthening the US oil sector.

Peak oil also appears to be well into the future. Some estimates have pushed that date out toward 2040. The abundance is another reason oil-based energy solutions will continue to hold significant market share.

Oil industry executives have bragged about the need for their products. Exxon’s CEO even said that greenhouse gas emissions are driven by the public’s decision to keep the cost of the energy they use low. This is one reason Exxon’s reputation is so poor.

Crude trades at $73 a barrel, well below the $80 level through 2024. Crude and the pollution it produces are not going anywhere.