Global oil demand slows
Oil rigs in Culver City, Calif.
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Kai Ryssdal: The United Arab Emirates is a member of OPEC, so you'd like to think the country's energy minister knows whereof he speaks when he's talking about oil prices.
That crazy comment I mentioned came when he was asked about a meeting that Saudi Arabia has proposed, a gathering of oil buyers and sellers later this month to talk about stabilizing the market.
The International Energy Agency said today that's already happened: that global demand has actually slowed to a third of what it had been predicting.
Whether or not that'll do anything to prices, well, here's Marketplace's Dan Grech.
Dan Grech: Demand is definitely falling in the U.S. The evidence is in grounded airplanes, less driving, falling truck sales.
The IEA projects U.S. demand for oil will contract by up to 2.5 percent this year. In the past, that would have been enough to lower prices. Not anymore, says energy expert Chip Groat with UT Austin.
Chip Groat: We were seen as the governor of demand, but clearly China and India and other developing parts of the world have outstripped us as far as impact on global oil and gas supplies. And so, for how the future will look, we have to look to them.
The IEA says for prices to go down, we need to reduce demand. That means cutting energy subsidies in emerging countries and keeping taxes in place in the developed world.
But supply is a bigger problem. Existing oil fields are drying out, while new ones have yet to come online. And OPEC says it has little spare pumping capacity.
Lester Lave is an economist with Carnegie Mellon University.
Lester Lave: The overall economy of the United States has been shaped for 100 years by inexpensive and declining fossil fuel prices. That era is over.
Lave says it would be easy for the U.S. to put pressure on China and India to cut back on their oil consumption, but he says we need to put our own house in order, too.
Lave: We're the 800-pound gorilla in the room, or rather, we're the five-mile-per-gallon Hummer that is consuming the world's petroleum.
Lave says overcoming the current oil shock will require Americans to make wholesale lifestyle changes and, more than likely, take a lot of short-term pain.
I'm Dan Grech for Marketplace.