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High Oil price – Good for everybody May 24, 2008

Posted by Bipin Agarwal in Real Estate Development in Global Economy.

It is easy to be short term focused and say high oil price is not good. Let us look at why high oil price is good for everybody.

Environment – Take a note, Oil is the biggest source of pollution. high oil price means less oil consumption. It has been proven time and again, that users and providers of energy will innovate and find new sources of energy.
Real Estate & Infrastructure – Real estate development will accelerate all over the world as people will try to move close to hub of public transport. New community development will be more organized with walk to different facilitiies. There will be significant investment in public infrastructure.
Auto Industry – Trust me, the industry will re-invent itself to provide the cars that do not use oil. New cars will replace the older cars, significant sales.
Oil Industry– Industry will re-cast itself as energy industry and find alternative energy sources.
Transportation – Rail industry is particularly likely to benefit. Shipping, truck, and airplane users will invest significantly to use alternative source of energy.
Financial Services – Companies will be ready to arrange financiing for business and consumer as new growth happens.
Technology – There will be significant investment to find killer technology. Biofuel, nuclear will be the looser. They create more problem then solve.

Feel free to let me know if you think a particular industry, country, or demographic will not benefit in the long run from high oil price.


Bipin Agarwal



1. Thomas Tait - June 28, 2008

Dear Bipin,

Excellent post!

Adversity is best met with the quality of hope and creativity that your words illustrate. Those who counsel despair would leave us mired in our problems. As it is written, “every adversity has the seed of an equivalent or greater benefit.”

Thanks for taking the time to share your insight.



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