As an old oil hand, I was seriously disturbed five years ago when it was almost impossible to develop a payback time for shale oil production. Since then it has continued to go missing as massive amounts of cash was spent on the industry. This suggests that we now know. It is never at the present pricing regime. This could not be worse news. It means that our vulnerability to supply disruption is rocketing while elasticity is dropping. US shale oil has merely postponed our day of reckoning by a few years while the decline in conventional oil production actually accelerates. Right now we are swapping dollars in the oil industry at best and the ship is clearly leaking. The only good coming out of all this is that massive amounts of money are coming home to be spent drilling more wells. Obviously this allows repatriation of US currency […]