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Predicting the Future? Oil, Politics, the Economy and Engineering

My career has been spent applying engineering principles to predict the future - specifically how actual or planned physical systems will respond in the future. Such predictions of course allow engineers to make decisions on safety, energy, environmental impact, and cost. Physical systems follow the laws of physics. Compared to other areas of human endeavor like oil, politics, and the economy, engineering is easy. 

On a flight to California a couple days ago I read a variety of articles discussing oil, politics and the economy - as well as engineering and technology. Everyone wants to know about the future. I want to know about the future. Lots of people are trying to predict the future.

Trying to See the Future


The Economy

Like engineering, economics follows laws. But those laws are based on human behavior and not physics. For example, one hears frequently about "the law of supply and demand". Most would agree that laws based on human behavior are less certain than physics. Thus predicting the economy is less certain than predicting engineering.

Further, we all are aware of how the economy has become increasingly global in nature. Thus predicting the economy involves considering human behavior not just in our own local region or country but around the world. This makes predicting economics even more uncertain.


I think it is safe to say that politics is the worst of all. In more ways than one. Does politics follow any laws?

For Americans, just when you think politics cannot get any worse, you get what we have now in the current presidential election process. Who is going to win and what will it mean? 

It is possible the USA could have a President Trump, something no one would have predicted a year ago. Another President Clinton (Hillary) seems more likely to some, but the more people see of Hillary Clinton the less they like her. What a mess. And seemingly unpredictable.

The rest of the world of course has difficult political situations too. Will the British leave the European Union? Will Brazil impeach their president? Will Venezuela be able to move past their disastrous experiment with socialism and remove their president?


Oil is a strange combination of engineering, global economics and global politics.

Consider Saudi Arabia's efforts to move away from oil. See The $2 Trillion Project to Get Saudi Arabia’s Economy Off Oil. Who would have predicted that? At least during a time when oil is still considered plentiful?

I visited Houston in April and Edmonton (Alberta, Canada) in May. Both regions have been significantly impacted by the drop in the price of oil. One of AFT's customers in Edmonton I visited has seen staffing drop by 70% and their process engineering group staffing drop by over 80%. Houston (and the larger American Gulf Coast) appears to have fared better - which some attributed to a more diverse local economy that involves more chemicals and natural gas than does Edmonton. 

"The oil market is making everyone a bozo" article had this quote from Exxon CEO Rex Tillerson:

When the price's around $60, I asked Rex, "What do you think?" He said, "Well, it's going to be between $20 to $120, and we're set up for all of those environments. I think it'll go a little lower than higher, but what do I know? I've just been doing this my whole life." And I thought, he's kidding, but he really wasn't.

An Unpredictable Future...

Some things just cannot be predicted. But that is not going to stop predictions from being made on those things. Abraham Lincoln is given credit for this saying:

The best way to predict your future is to create it.

That seems like great advice to me.

Things Are Really Stacking Up – Creating Stacked G...
What Would You Like to Do? – Exploring the New Gra...
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