Posted by: Marshall Sponder | June 7, 2008

Oil Demand – Explained.

Last two Paul Krugman blog posts brought me to this news story about Energy chief: Flat production behind oil prices where it was explained much of what we already knew:

….Production has stalled since 2005 at 85 million barrels a day, while economic growth — particularly in China and India — has pushed demand ever higher, Bodman said before a meeting of ministers from the U.S., Japan, South Korea, India and China.

“We’re in a difficult position where we have a lid on production and we have increasing demand in the world,” he told a small group of reporters, dismissing the effects of speculation and unclear inventory levels and other factors on oil prices.

“I would devoutly hope we … see a reduction of the use of oil in the world on the one hand, and an increase in the supply so we can see some mitigation in the pressure on price,” Bodman said.

BTW, the Krugman posts I refer to are Has the Bush administration bought into peak oil theory? where he reminded us about a silly thing George Bush said 8 years ago … boy was that dumb:

…. it’s a long way from the days when candidate George Bush claimed that he could keep oil prices low by using his personal powers of persuasion to get “our friends in OPEC” to “open the spigot”.

and We need a new business cycle vocabulary where I took what Krugman said and pointed it towards another direction …. Art … Redefination of Art – what is Art now?

First, compare this chart with the one below it

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The idea of what a “recession” was, or is, needs to be redefined – same way that what it means to be an artist needs to be redefined in light of the current time we live in.

…. Now we have what looks and feels like a recession that, from the point of view of the labor market, started before it officially began.

The point, I think, is that the traditional definition of recession only worked well in the face of a jagged business cycle; if we now have smoother, longer curves — maybe due to better inventory management, or whatever caused the Great Moderation — the question, “Is this a recession?”, no longer means much.

How does that tie in with Web Analytics? It does, because the field of Web Analytics is in the process of being redefined, and I’m not even sure that in 5 years, what we do is going to be called Web Analytics, any more.

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