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China & India

by David Pascoe

Posted September 27, 2006

This and other three texts below contain short summaries on the status of the nation states that now have, and will in the future, the greatest effect on oil prices. They have been kept separate from the body of the report The Future of Fuel Prices because they are essentially political in nature.

In the last ten years the world has gone through a period of unprecedented growth, driven primarily by the U.S., China and India. The later two represent the major growth sector for growing oil demand, while the older industrialized west has greatly slowed in the rate of fuel usage for a variety of reasons, not the least of which is improved efficiency and the transfer of manufacturing to so-called third world.

Very high oil prices over the last year or so are putting the brakes on China and India. Both nations recognize that they cannot allow their unprecedented growth in oil use to continue. Therefore, they have embarked on major programs to improve efficiency plus development of other fuel sources. These are coming rapidly into effect, motivated by too much of their currency leaving the nation. Therefore, their rate of oil consumption will not be as high as experts previously predicted, and this will help to relieve upward oil price pressures. Other factors to slow their oil consumption will include the fact the neither of these nations have the road infrastructure needed to sustain previous levels of automobile growth, for which a strong incentive to slow the rate of auto purchases is emerging.

On the down side, both these nations, particularly China, have made concerted efforts to tie up future supply by means of long term contracts and other political deals. A good example is China's recent deals with Castro over recent Cuban finds, as well as Chinese deals with Iran. At one time I used to fear these totalitarian nations, but time has a way of revealing their inherent weaknesses. Essentially what we have is thieves making deals with thieves. History is strewn with the wreckage of such deals that tend to be short-lived. India has recently discovered that the U.S. is not her enemy and China must mind her manners with her largest customer, lest she have no money to even buy oil.

Back to The Future of Fuel Prices

Posted September 27, 2006



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David Pascoe - Biography

David Pascoe is a second generation marine surveyor in his family who began his surveying career at age 16 as an apprentice in 1965 as the era of wooden boats was drawing to a close.

Certified by the National Association of Marine Surveyors in 1972, he has conducted over 5,000 pre purchase surveys in addition to having conducted hundreds of boating accident investigations, including fires, sinkings, hull failures and machinery failure analysis.

Over forty years of knowledge and experience are brought to bear in following books. David Pascoe is the author of:

In addition to readers in the United States, boaters and boat industry professionals worldwide from nearly 80 countries have purchased David Pascoe's books, since introduction of his first book in 2001.

In 2012, David Pascoe has retired from marine surveying business at age 65.

On November 23rd, 2018, David Pascoe has passed away at age 71.

Biography - Long version


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