The former chief economist of CIBC World Markets talks about his new book The End of Growth.
Q: What compelled you to write The End of Growth?
A: I ended up in my last book arguing that triple-digit oil prices were no accident. It wasn’t the result of financial market speculations; it’s basically where the demand and supply for oil now rested, and that we would see a return of these prices very early into an economic recovery. And low and behold, that’s pretty well what happened. As of, say, January 2011, Brent, which is the world oil price, crossed into triple-digit range, got as high as $127 a barrel, and it’s even still today in the triple-digit range. So, what are the consequences of that? I think the basic dilemma is this: we need those kinds of prices to get millions of barrels out of things like tar sands, deep water, oil shale, Brazilian sub-salt, but unfortunately, the very prices that we need to lift oil out of the reserves that it now comes from translates into the same prices that basically kill our economies. Read more