February 16, 2024
Like most curmudgeons, I can do a five minute ramp on how cheap gasoline was when I was a kid and how outrageous the price is now. Living in Chicago we “enjoy” some of the highest and most volatile gasoline prices in the country. Cue the back-up rant on how curious it is that our local refinery suffers a mysterious mechanical failure just as gas prices start to dip; instead they go up twenty five cents a gallon in a day. It is all rather tiresome after some twenty years. Reports from around the gear industry show business is slowing down, and it is pretty clear that falling oil prices are a big part of the decline. It doesn’t take long for the oil supply chain to pull back its plans when prices fall. No conspiracy is needed for smart business owners to stop producing oil they can’t sell at a profit. So those of us who make our living designing and making things that are used to find or process oil are in a bit of a quandary: do we root for low prices at the pump and hope to find other projects to replace the lost oil patch work, or do we hope the complex geopolitics of oil settle down and the price-per-barrel resumes its steady climb? Like it or not — oil still powers the world economy. We may wish it were not so. We may throw our efforts into wind, solar, geothermal, hydro, tidal, or even nuclear power, but it will be many years before oil and, to a lesser extent, coal take a back seat to any other energy form. Much of the world still hasn’t fully enjoyed the life-altering effects of petroleum and experience has shown that once they do they will want more of it — not less. Eventually that untapped demand will overcome the temporary damper geopolitics has put on oil prices. As consumers we know the likely cost of a gallon of unleaded will be higher a year from now. Let’s hope our order books are a bit fuller too. Until then we need to continue to improve our products and methods and continue to seek new markets.