How would you feel about filling up your car at two dollars a litre?
With consumers balking at anything more than one dollar, I doubt many would be able to afford to drive a small to midsize vehicle … let alone an SUV. According to Jeff Rubin, CIBC World Markets' former chief economist, oil is about to create a lot of upset in our current global economy.
Rubin claims the abundance of cheap oil in the world has created a market that is over reliant on the commodity's affordability. Everything made in China, Atlantic salmon, and even your oversized house in the suburbs, will become luxury items, or more like normal items with an insane price tag.
Rubin points out that while we may be pumping more oil out of the ground, we have not been able to discover new oil deposits at the rate we are depleting those we already pump from. So, although this means that globalism as we know it will no longer be able to thrive as it currently does, we can expect a rebirth of the local economy where our labour costs are now competitive to the cost of manufacturing and shipping from China. As Rubin puts it; “don’t be surprised if the new smaller world that emerges isn’t a lot more liveable and enjoyable than the one we are about to leave behind.”