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Oil Prices Are Reaching Extreme Lows
Porter's Journal Issue #62, Volume #2
Porter Stansberry
May 30, 2025
And That’s Not Necessarily Good News
This is Porter’s Daily Journal, a free e-letter from Porter & Co. that provides unfiltered insights on markets, the economy, and life to help readers become better investors. It includes weekday editions and two weekend editions… and is free to all subscribers.
The ridiculous idea of Peak Oil… There is plenty of oil and there always will be… OPEC has lost control of the market… the huge disparity between oil prices and gold prices is a warning… There’s too much speculation in gold and Bitcoin… The tariff roller coaster continues… |
Table of Contents
By 2008, American oil production had been falling since 1970.
That year, America barely produced 5 million barrels of oil per day – down by 50% since the early 1970s.
I’m sure you will remember, with falling production came the inevitable Malthusian nonsense: Peak Oil.
Like “killer bees,” global warming, the “population bomb,” and Y2K, Peak Oil was also a ridiculous idea that publishers used to scare the bah-jesus out of people to sell newsletters. Some of my less-credible peers even called themselves “Mr. Peak Oil.”
The funny thing about all these neo-Malthusian ideas is, while they might sound plausible, all of the actual evidence proves that they are completely wrong.
As early as 2006, I was predicting a renaissance in U.S. oil production because I knew that higher prices would drive new discoveries and innovation in production. The Peak Oil wingnuts shouted me down at conferences.
But, guess what? Economics won, again. Shocker.
By 2009, my best contact in the oil and gas industry, Cactus Schroeder, was telling me about a huge new field (the Eagle Ford) that was going to produce unprecedented amounts of crude oil. He also explained that these new kinds of oil fields – driven by revolutionary new production methods like horizontal drilling and fracking – meant an end to dry holes and vastly more capital efficient discovery.
Porter, you wouldn’t believe it… we took that six-inch horizontal pipe and we replaced it with a 12-inch pipe…”
Cactus, let me guess,” I interrupted. “Production increased by four-fold.”
How’d you know that?”
It was obvious to anyone who knew what was happening in the fields that U.S. oil and gas production was going to boom. I remember being at a conference in Las Vegas with commodities expert Rick Rule in 2010 or 2011. Rick was, of course, saying he thought natural gas was pretty cheap at $3. I said, “Anyone who is buying gas here should have their heads examined. There’s no question gas is going below $2 and oil is going below $40.” We made a bet about gas prices.
I won.