It’s been a long road for the US and the world over the past few years, but here we are at the end of it. The oil and natural gas prices have finally reached the top of the ladder and each and every individual country is trying to decide just how much of a disaster the current collapse of oil and natural gas prices really is.
Everyone seems to think that the collapse of the crude oil price has been a calamity of epic proportions, but the truth is that in reality, the situation was far more manageable. There were a number of factors working against the oil and natural gas prices, but not all of those factors have now disappeared.
There is only one thing left in place that will stop the collapse of the crude oil price. That is the dominance of the US dollar. The US dollar is a very strong currency and the weaker countries like Venezuela or even India will need to maintain high interest rates to keep the government funded and the corporations operating.
This means that there is no longer any reason for the price of crude oil to rise anymore. There is little doubt about that, because the only force capable of preventing an increase is the United States Dollar. Of course, the fact that the US dollar is the reserve currency of the world will have to be kept in mind.
But the dollar is not the only currency involved in the crash of the crude oil price. In fact, many nations are struggling to keep their currencies afloat. For example, Saudi Arabia, the second largest oil producer in the world, is suffering from low oil prices and with less oil, its currency is crashing.
Yes, of course, the US dollar will be worth a lot more if oil prices rise. However, the Saudis have to be given some credit as well. In fact, they probably saved themselves a great deal of money by maintaining interest rates at absurdly high levels, which basically sucked wealth out of the economy.
But they are feeling the pinch now. The big question that everyone is asking is where is the oil going to come from now? Well, if you assume that all of the oil is gone from the ground and that the oil has all been extracted from the sea floor, then the only solution to the problem would be the development of new sources of oil.
And one of the most likely new sources of oil to be developed is fracking. Now, many people believe that the US would eventually have to go back to using gasoline to power vehicles, but that’s not happening.
One of the most effective methods for achieving our energy independence right now is to develop alternative forms of energy and that includes building oil and natural gas pipelines across the United States. It may sound odd to say that we should be focusing on a new source of oil, but that’s the only logical solution. And that is what will be required to keep the US Dollar from plunging further.
Once those pipelines are built, there will be far less reason for the value of the US Dollar to fall. To put it bluntly, if oil prices stay low, then the US Dollar will continue to rise. We can begin to see how this scenario will end.
The realization that oil and natural gas prices are about to rise is beginning to get the attention of governments all over the world. Once the US dollar starts to fall, they will simply start to use the newly-developed and improved oil and natural gas pipelines and turn their backs on the oil-producing nations and countries that have collapsed. There is no way to predict how things will turn out, but all the indications are that they will become quite desperate.