Hilarious

Financial Times. Here's a quote for those that think there is excess production out there:

Opec’s president on Monday warned oil prices could hit $200 a barrel and there would be little the cartel could do to help. The comments made by Chakib Khelil, Algeria’s energy minister, came as oil prices hit a historic peak close to $120 a barrel, putting further pressure on global economies.

More from the NYTimes on production (market failure?):

“What is disturbing here is that things seem to get worse, not better,” an analyst at Goldman Sachs, David Greely, said. “These high prices are not attracting meaningful new supplies."

Comments

[James Bowery]

Even the more pessimistic estimates failed to predict how bad things would be.

This is basically because capital has, by government policy, been concentrated in the wrong kinds of hands. Now they have the reigns of civilization but they just don't know what to do since they are Malthusians who are posing, even to themselves, as Cornucopians.

[John Robb]

It's getting close to crunch time.

I wish I had a dollar for every time I have heard an analyst (pick your industry) say "this is a perfect storm."

[londamium]

Market Failure? Only if you believe in voodoo economics.

These high prices are not attracting meaningful new supplies? Evidently the prices aren't high enough to curtail demand or stimulate the appropriate conservation/efficiency responses ( ie the market is quite content to bear current price levels ).

[James Bowery]

Londamium, what do you think would be the consequence of a regressive net asset tax, if not a market failure due to demand-side collapse in the face of massive idle assets (like empty houses), while people go homeless and unemployed?