Dan's comment that the EIA, the US government Energy Information Agency,
bases its figures on estimates is no longer so.
I am surprised that being a writer for Oilprice.com he did not know
that the EIA had changed to using figures from State Government monthly
returns. It has been mentioned in Oilprice.com articles.

There has always been complaints about the accuracy of EIA figures.
Now however recent articles in the US have been reporting significant
declines in US oil production since EIA changed its source of data.

What Dan does not discuss is when the pressure for higher prices
comes on there will be resistance from a fraction of the market that
cannot pay the higher prices. Just how big is that fraction is the
$64 billion question.
A large part of it is made up of Joe Six pack (Joe Blow to us) on his way to work.
The farmer will pay because he must work his land and he will just
pass it through to the food processor.

Does this not have echos of 2007 ? The climb in prices triggered the
the GFC in 2008 when oil reached $147 a barrel.

Watch with interest with one finger on share market selling button.

Bazz, the GFC was triggered by the subprime loan crisis, not high oil prices.

Wrong Aiden, the high oil prices triggered the already primed bomb
known as the subprime loans.
EVERY Recession, except the Dotcom was preceded by a spike in oil prices.

The GFC was warned about it many many years previously but the skeptics
were ot listening.

Baz, by what mechanism do you think the subprime loans bomb was triggered by high oil prices? Do you think the subprime homebuyers could've afforded to service their loans had oil prices been lower? Or do you think that it would've prevented banks from making those loans? Or derivative traders from underestimating the risk?

Oil prices tend to rise when demand is high and fall sharply when demand drops, so you can expect every global recession to be preceded by a spike in oil prices.

I wonder if in the rear view mirror 2015 or perhaps 2016 will be the all time peak year for liquid fuels at about 93 million barrels per day. You'd think the oil price will have to go up unless it stays at ~$50 all the way til the last drop. Since we don't see trucks and farm tractors powered by batteries I think that must mean reduced economic activity and output.

I can't imagine what will happen if combined liquid fuels (oil, tar sands, biofuel, condensate) shrink to say 80 mbpd. Now is just the calm before the storm.

Aiden,
First note that peak crude oil occurred in late 2005.
The oil price started increasing through 2007/2008.

The mechanism was quite simple and was tracked in detail at the time.
The rising oil price diverted large amounts of maize grain into ethanol
production. This caused an increase in price that affected many
foodstuff productions including meat production as corn as they call it
was forced up in price.

The whole food chain was affected, farmers had higher fuel costs,
transport had higher fuel costs, food processors had higher costs in
food distribution.

Joe Sixpack, almost all of whom drive to work and live in the distant
suburbs, had some choices to make.
He could buy petrol to drive to work, he could buy food for his family or pay the mortgage.

In view of the increase in mortgage defaults that occurred during
2007 & 2008, what do you think he chose ?