• 3 minutes Could Venezuela become a net oil importer?
  • 7 minutes Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 12 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 14 hours Could Venezuela become a net oil importer?
  • 6 hours Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 18 hours Tesla Closing a Dozen Solar Facilities in Nine States
  • 1 min Oil prices going Up? NO!
  • 14 hours Gazprom Exports to EU Hit Record
  • 16 hours EU Leaders Set To Prolong Russia Sanctions Again
  • 14 hours Could oil demand collapse rapidly? Yup, sure could.
  • 14 hours Oil Buyers Club
  • 18 hours Why is permian oil "locked in" when refineries abound?
  • 7 hours Oil prices going down
  • 24 hours China’s Plastic Waste Ban Will Leave 111 Million Tons of Trash With Nowhere To Go
  • 23 hours Saudi Arabia plans to physically cut off Qatar by moat, nuclear waste and military base
  • 17 hours EVs Could Help Coal Demand
  • 5 hours Russia's Energy Minister says Oil Prices Balanced at $75, so Wants to Increase OPEC + Russia Oil by 1.5 mbpd
  • 12 hours Saudi Arabia turns to solar
  • 27 mins Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
Alt Text

Why Wall Street Is Bullish On Refiners

Wells Fargo has noted that…

Alt Text

Trump’s Tariffs Lead To Selloff In Oil Markets

The announcement of the Trump…

Alt Text

The Best Places In The World To Mine Bitcoin

As Chinese bitcoin miners face…

Charles Hugh Smith

Charles Hugh Smith

Charles Hugh Smith has been an independent journalist for 22 years. His weblog, www.oftwominds.com, draws two million visits a year with unique analyses of global…

More Info

Trending Discussions

The Similarities Between Deepwater Horizon and Global Financial Meltdown

The explosion of Deepwater Horizon and the collapse of Lehman Brothers share similar characteristics of risk, denial and coverup.

My good friend G.F.B. recently observed that the Deepwater Horizon catastrophe uncannily mirrors the global financial meltdown that was triggered by the September, 2008 collapse of Lehman Brothers.

G.F.B. suggested that the Deepwater Horizon fiasco mirrored the global financial meltdown, almost as if it were a physical manifestation of the same hubris, denial of risk, manipulation and misinformation which collapsed the global financial house of cards.

Deepwater Horizon Explosion

How? Consider:

1. The extreme levels of inherent risk in each system were downplayed/misunderstood by those responsible for their management.

2. The unprecedented risk intrinsic to each system was masked by facsimiles of regulation and specialized expertise.

3. The initial warning signs were dismissed, downplayed or ignored.

4. Each system was on the outer edge of human engineering (mechanical and financial) but was treated by regulators and managers as entirely standard.

5. Once the system collapsed, nobody knew how to fix it.

6. As the full extent of the damage became apparent, those responsible sought to mask the true extent pf the damage.

7. The mainstream media and elected officials unskeptically accepted prevarications, mis-statements, misinformation and manufactured facades as representations of the truth.

8. As the true extent of the damage, distortion/manipulation and failure of responsible authorities became undeniable, public confidence in government, regulatory agencies and the market irrevocably eroded.

Here is a chart of the market with my notes. This basic pattern applies to Deepwater Horizon as well, only on a much shorter timescale.

Systemic Collapse

Didn't anyone notice that it is the height of insanity to be drilling down 18,000 feet down into a seabed which is 5,000 below the surface of the sea?

There's plenty of oil around, really; we're just drilling down 23,000 feet into marginal oil deposits just because we enjoy a challenge.

Didn't anyone notice that becoming entirely dependent on unprecedented levels of extreme leverage and trillions of dollars of derivatives for "economic growth" was an insane proposition doomed to eventual implosion?

Drilling Depths

First, walk 5,067 feet (roughly a mile or 1.5 kilometers). Then walk 18,360 feet (roughly 5.6 KM). You have traversed the depth of the well drilled by Deepwater Horizon.

Charles Hugh Smith has been an independent journalist for 22 years. His weblog, www.oftwominds.com, draws two million visits a year with unique analyses of global finance, stocks and political economy. He has written six novels and Weblogs & New Media: Marketing in Crisis and just released Survival+: Structuring Prosperity for Yourself and the Nation.




Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News