When the wheels fall off

In a previous post I wrote about how I thought geopolitics was being ignored and ought to come back into the oil price equation – it looks like that is starting to happen, the threat by Turkey of shutting of Kurdish exports made a strong point, not ignored by the market. At the same time, surprise, surprise, demand is picking up “more than expected”

The wisdom of the crowds is a nice idea, can result in some surprisingly accurate results. However, we all know about the myriad cognitive biases that afflict us poor humans, and as Ben Horowitz notes in “The Hard Thing about Hard Things”, group think can be very efficient at reaching the wrong conclusion. We have seen this (in my opinion) spectacularly in the past couple of years with the “Lower for Longer” mantra becoming “Lower Forever” as the demise of the ICE is gleefully forecast.  Perhaps that’s a bit harsh, as even those of us in the industry recognize that 100 year old technology is perhaps neither the most efficient form of transport nor the best use of a precious resource like oil.

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