Peak Oil Fallacy: They've Been Singing This Song For Decades

Quick, guess what year these lyrics are from:

I've been waiting for years to buy a brand new cadillac
But now that I've got one I want to send it right back
I can't afford the gas to fill my luxury limousine
But even if I had the dough no one's got no gasoline

Who needs a car and a seven-forty-seven
When you can't buy a gallon of gas
Who needs a highway, an airport or a jet
When you can't get a gallon of gas
There's no more left to buy or sell
There's no more oil left in the well
A gallon of gas can't be purchased anywhere
For any amount of cash
You can't buy a gallon of gas -- The Kinks

And those words were written in 1979.

One of the main reasons I've gotten so outright bearish on oil and have tried to call a top in oil around the $120 range is in large part because I can't believe all these people who think this ongoing boom part of the energy cycle is somehow "different" and sustainable "this time". It's not, and there are so many great anecdotes and stories and histories to look back at as to why this cycle is just like all the others we've seen in energy for the last century and a half.

For example, as I walked from Fox HQ to the Waldorf for the show last night, my iPod randomly brought up the song "A Gallon of Gas". That reminded me of another song I like...so when I got home last night, I pulled it up on the iMac. Wanna guess what year these lyrics were written?

There's only so much oil on the ground
Sooner or later there won't be much around
Tell that to your kids while you driving downtown
That there's only so much oil on the ground

Can't cut loose without that juice
Can't cut loose without that juice
If we keep on like we doing things for sure
Will not be cool - It's a fact
We just ai't got suffiecient fuel

There's only so much oil in the ground
Sooner or later there won't be none around
Alternate sources of power must be found
Cause there's only so much oil in the ground

Sounds like that "Peak Oil" theory that everybody and their dog can cite to explain how this time, in 2008, we really are running out of oil. I hate to burst all you energy-lovers' bubbles, but those lyrics about alternative sources of power were written by Tower of Power in the antiquated year of...1975. Yes, the 1975 that happened 32 years ago. Wonder if ToP felt silly singing about peak oil after energy prices collapsed a few years later. Ray Davies recently brought back his lyrics from the Kinks song above.

But really, maybe it REALLY IS DIFFERENT THIS TIME! Or not.