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Why "Supply & Demand" Doesn't Work For Oil
Submitted by Gail Tverberg via Our Finite World blog,
The traditional understanding of supply and demand works in some limited cases–will a manufacturer make red dresses or blue dresses? The manufacturer’s choice doesn’t make much difference to the economic system as a whole, except perhaps in the amount of red and blue dye sold, so it is easy to accommodate.
Figure 1. From Wikipedia: The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D). The diagram shows a positive shift in demand from D1 to D2, resulting in an increase in price (P) and quantity sold (Q) of the product.
A gradual switch in consumer preferences from beef to chicken is also fairly easy to accommodate within the system, as more chicken producers are added and the number of beef producers is reduced. The transition is generally helped by the fact that it takes fewer resources to produce a pound of chicken meat than a pound of beef, so that the spendable income of consumers tends to go farther. Thus, while supply and demand are not independent in this example, a rising percentage of chicken consumption tends to be helpful in increasing the “quantity demanded,” because chicken is more affordable than beef. The lack of independence between supply and demand is in the “helpful” direction. It would be different if chicken were a lot more expensive to produce than beef. Then the quantity demanded would tend to decrease as the shift was increasingly made, putting a fairly quick end to the transition to the higher-priced substitute.
A gradual switch to higher-cost energy products, in a sense, works in the opposite direction to a switch from beef to chicken. Instead of taking fewer resources, it takes more resources, because we extracted the cheapest-to-extract energy products first. It takes more and more humans working in these industries to produce a given number of barrels of oil equivalent, or Btus of energy. The workers are becoming less efficient, but not because of any fault of their own. It is really the processes that are being used that are becoming less efficient–deeper wells, locations in the Arctic and other inhospitable climates, use of new procedures like hydraulic fracturing, use of chemicals for extraction that wouldn’t have been used in the past. The workers may be becoming more efficient at drilling one foot of pipe used for extraction; the problem is that so many more feet need to be drilled for extraction to take place. In addition, so many other steps need to take place that the overall process is becoming less efficient. The return on any kind of investment (human labor, US dollars of investment, steel invested, energy invested) is falling.
For a time, these increasing inefficiencies can be hidden from the system, and the prices of commodities can rise. At some point, however, the price rise becomes too great, and the system can no longer accommodate it. This is the situation we have been running into, most severely since mid-2014 for oil, but also for other commodities, dating back to 2011.
Figure 2. Bloomberg Commodity Index from Bloomberg, reflecting a combination of 22 ETFs in Energy (35%), Agriculture (29%), Industrial Metal (15%), Precious Metals (16%) and Livestock (5%)
The higher cost of producing oil and other energy products affects the economy more than a shift from chicken to beef.
The economy is in a sense more dependent on energy products than it is on our decision whether to eat chicken or beef. If the cost of producing oil rises, and that higher cost is carried through to prices, it affects the prices of many things. It affects the cost of food production because oil is used in the production and transport of food. The higher cost of oil also affects nearly all transported goods, since oil is our primary transportation fuel.
Some of the impacts of higher oil prices are clearly adverse for the economy.
If higher oil costs are passed on to consumers as higher prices, these higher prices make goods less affordable for consumers. As a result, they cut back on purchases, often leading to layoffs in discretionary sectors, and recession.
The higher cost of oil products (or of other energy products) also tends to reduce profits for businesses, unless they can find workarounds to keep costs down. Otherwise, businesses find themselves in a situation where customers cut back on purchasing their products. As we will discuss in a later section, this tends to lead to reduced wages.
Some of the impacts of higher oil prices are somewhat positive.
Rising oil prices clearly encourage rising oil production. With this, more jobs are added, both in the United States and elsewhere. More debt is added to extract this oil, and more equipment is purchased, thus stimulating industries that support oil production. The value of oil leases and oil properties tends to rise.
As noted previously, the cost of food supply depends on oil prices. The cost of producing metals also depends on oil prices, because oil is used in extracting metal ores. As the prices of metals and foods rise, these industries are stimulated as well. Values of mines rise, as do values of agricultural land. More debt is taken out, and more workers are hired. More equipment is purchased for producing these products, adding yet more stimulation to the economy.
The higher price of oil also favorably affects the many countries that extract oil. Part of this effect comes from the wages that the workers receive, and the impact these wages have, as they cycle through the economy. For example, workers will often want new homes, and the purchase of these new homes will add jobs as well. Part of the effect comes through taxes on oil production. Oil production tends to be very highly taxed, especially in parts of the world where oil extraction can be performed cheaply. This tax money can be put to work in public works programs, providing better schools and hospitals, and more jobs for citizens.
It is inevitable that the price of oil must stop rising at some point because of the adverse impact on spendable income of consumers.
The adverse impact of higher oil prices on the spendable income of consumers comes in many ways. Perhaps one of the biggest impacts, but the least obvious, is the “push” the higher cost of oil gives to moving manufacturing to locations with lower costs (cheaper fuel, such as coal, and lower wages), because without such a change, higher oil prices tend to lead to lower profits for many makers of goods and services, as mentioned previously.
The competition with lower-wage areas tends to reduce wages in the US and parts of Europe. This push is especially great for jobs that are easily transferred to other countries, such as jobs in manufacturing, “call-centers,” and computer tech support.
Another way businesses can maintain their profit levels, despite higher oil costs, is through greater automation. This automation reduces the number of jobs directly. Automation may use some oil, but because the cost of human labor is so high, it still reduces costs overall.
All of these effects lead to fewer jobs and lower wages, especially in the traditionally higher-wage countries. In a sense, what we are seeing is lower productivity of human labor feeding back as lower wages, if we think of the distribution of wages as being a worldwide wage distribution, including workers in places such as China and India.
Normally, greater productivity feeds back as higher wages, and higher wages help stimulate higher economic growth. Lower wages unfortunately seem to feed back in the reverse direction–less demand for goods that use energy in their production, such as new homes and cars. Ultimately, this seems to lead to economic contraction, and lower commodity prices. This is especially the case in the countries with the most wage loss.
The drop in oil prices doesn’t do very much to stop oil production.
Oil exporting countries typically have relatively low costs of production, but very high taxes. These taxes are necessary, because governments of oil exporters tend to be very dependent on oil companies for tax revenue. If the price of oil drops, the most adverse impact may be on tax revenue. As long as the price is high enough that it leads to the collection of some tax revenue, production will take place–in fact, production may even be increased. The government desperately needs the tax revenue.
Even oil companies in oil-importing countries have a need for revenue to pay back debt and to continue to pay their trained workers. Thus, these companies will continue to extract oil to the best of their ability. They will aim for the “sweet spots”–places that have better than average prospects for production. In some cases, companies will have derivative contracts that assure them of a high oil price for several months after the price drops, so there is no need to reduce production very quickly.
The drop in oil prices, and of commodity prices in general, makes debt harder to repay and discourages adding new debt.
We earlier noted that a rise in the price of commodities tends to make asset prices rise, making it easier to take out more debt, and thus stimulates the economy. A drop in the price of oil or other commodities does the opposite: it reduces asset prices, such as the price of the property containing the oil, or the farmland now producing less-expensive food. The amount of outstanding debt does not decline. Because of this mismatch, companies quickly find themselves with debt problems, especially if they need to take out additional loans for production to continue.
Another part of the problem is that on the way up, rising prices of oil and other commodities helped lift inflation rates, making debt easier to repay. On the way down, we get exactly the opposite effect–falling oil and other commodity prices lead to falling inflation rates, making debt more difficult to repay. Commodity prices in general have been falling since early 2011, leading to the situation where interest rates are now negative in some European countries.
The costs of producing commodities continue to rise, as a result of diminishing returns, so this fall in prices is clearly a problem. Low prices make future production unprofitable; it also leads to an increasing number of debt defaults. There are many examples of companies in financial difficulty; Chesapeake Energy is an example in the oil and gas industry.
* * *
Where oil supply and demand goes from here
The traditional view of the impact of low oil prices seems to be, “It is just another cycle.” Or, “The cure for low prices is low prices.”
I am doubtful that either of these views is right. Falling prices have been a problem for a wide range of commodities since 2011 (Figure 2, above). The Wall Street Journal reported that as early as 2013, when oil prices were still above $100 per barrel, none of the world’s “super major” oil companies covered its dividends with cash flow. Thus, if prices are to be sufficiently high that oil companies don’t need to keep going deeper into debt, a price of well over $100 per barrel is needed. We would need an oil price close to triple its current level. This would be a major challenge, especially if prices of other commodities also need to rise because production costs are higher than current prices.
We are familiar with illnesses: sometimes people bounce back; sometimes they don’t. Instead of expecting oil prices to bounce back, we should think of the current cycle as being different from past cycles because it relates to diminishing returns–in other words, the rising cost of production, because we extracted the cheapest-to-extract oil first. Trying to substitute oil that is high in cost to produce, for oil that is low in cost to produce, seems to bring on a fatal illness for the economy.
Because of the differing underlying cause compared to prior low-price cycles, we should expect oil prices to fall, perhaps to $20 per barrel or below, without much of a price recovery. We are now encountering the feared “Peak Oil,” because much of the cheap oil has already been extracted. Peak Oil doesn’t behave the way most people expected, though. The economy is a networked system, with high oil prices adversely affecting both wages and economic growth. Because of this, the symptoms of Peak Oil are the opposite of what most people have imagined: they are falling demand and prices below the cost of production.
If low prices don’t rise sufficiently, they can cut off oil production quite quickly–more quickly than high prices. The strategy of selling assets at depressed prices to new operators will have limited success, because much higher prices are needed to allow new operators to be successful.
Perhaps the most serious near-term problem from continued low prices is the likelihood of rising debt defaults. These debt defaults can be expected to have a very adverse impact on banks, pension plans, and insurance companies. Governments would likely have little ability to bail out these organizations because of the widespread nature of the problem and also because of their own high debt levels. As a result, the losses incurred by financial institutions seem likely be passed on to businesses and individual citizens, in one way or another.
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Another cartel controlled commodity. Actually, come to think of it, is there any that aren't? Wasn't it Goldman that got caught hoarding aluminum? Some claim that since oil is so low, rates will need to rise to offset the pension losses. I guess that's proof that all these 'markets' are free, like Armstrong claims, and the Fed has the American savers' back, as Yellen said.
Unfortunately, NOTHING could be further from the truth. Problem is we're in a death spiral due to debt. And with debt, the only way to prolong the agony of a default is issue more debt. If you accept that premise, how can rates rise? It would be digging your own grave if you are a bankster.
Does the author not understand demand and supply elasticity and the time lags with respect to capacity and substitutes? The above analysis is an oversimplification (or long obfuscation!) and has little to do (really) with supply and demand and seems more like an attempt to justify the historical deliberare manipulation of different economies (whether oil consumers or producers) through oil prices.
It also seemed to hint, without outright saying, that peak oil is a thing. Ain't seen no evidence of that yet. Just some people confidently assuring that there is such a thing. If it is real, then the Saudis are pumping themselves right out of the market. I don't care how addled they are with syphilis - that doesn't make any sense.
If most of the players in a game are losing position - you included - and you are the strongest at the moment, you should always try to shake out all of the weakest before you lose your own position due to the collusion of the others.
Strategy not your strong point, eh touchdown?
That only works if they (or another in their stead) can't get back in.
Apparently, you are playing checkers when everyone else is playing chess.
Of course she doesn't. She is just an oil company shill.
When the FED prints money and artificially allows exponential price rises in any sector then what follows is an exponential collapse in the sector when the stimulus is cut.
EXPONENTIAL GROWTH LEADS TO EXPONENTIAL COLLAPSE. It is just a fact of Nature.
For instance, during the first artificial elevation of Home Prices, Sir Alan decreased Interest Rates to fuel that bubble. The problem was that in Non Real Estate industries the wages failed to keep pace.
Thus what happens is that affordability of the artificially stimulated asset is diminished.
Backin 2006 I told my landlord that he should liquidate all of his Rental Properties and collect the bonanza. I asked him just how many $100K/year jobs were out there so that the buyers could afford the $700K Homes in the hyperinflated San Diego Real Estate Market? (That price was the AVERAGE for the homes selling in San Diegoat the time.)
He did not listen and retorted tha Home Prices only declined about 25% in a bust and that he was standing pat. Of course the damage was much larger than that in 2007-2010.
But the Oil Prices were kept elevated for so long that Fuel Prices made a substantial depletion of the savings of consumers as well as people used credit cards to buy their gas so that they could get to work. Of course the policies of George W. Bush's favoritism to the Oil Industry caused that inflation in Oil Prices in the first place.
Well, something, somewhere had to break. Even with declining Fuel Prices the consumer cannot afford to buy as their Credit Limits have been realized, their savings have been depleted, all combined with declining wages and chronic lack of employment...just what do they expect?
Correct as usual, Tall Tom. So many do not understand the negative marginal utility of debt. Broke is broke.
Energy available per capita has been declining for some time now, and the debt problem coupled with that and a fucked up commercial farming and feedlot system will equal a lot of hungry mouths. Nevermind ever increasing pollution. The future is for the rugged alone - there will be less.
Can you tell me where you saw that data ... on energy per capita? I'm not saying I doubt you ... I'd like to see the source. No need to say - if energy/capita starts dropping, then serious impacts on population levels will not be far behind.
Here is oil per capita, and energy per capita was closer to 2005-8 if I recall. though I can't find a good source at the moment. There is common ground in various related subjects - negative marginal utility of debt, continuous resource wars, rapidly declining ore grades - all under relentless population growth.
So it is more of a population problem after all.
Wars and the sickness and disease they spread cull the population best, so I guess we all have that to look forward to, eh?
Got Preps?
Population problem living BAU. Maybe, maybe not if many would live by a simple hierarchy of needs and provide more/most for themselves.
So I suppose you are right for many - death it will be. Some quick cullings, some a long grind down is my guess. Preps, some like-minded around you and some basic "survival" skills/knowledge - I quote survival as it was not-so-long-ago just what you knew and did to stay alive.
Yet another symptom of mispriced risk due to Fed printing. It's almost comical that the solution proposed at the end is a bailout of the oil producers ... with more printed money.
By printing money they've created a financial system so dependent on debt creation that it is literally destroying every productive industry in existence, saving only the non-productive FIRE industries at their expense.
And when it blows up, a couple years later, someone like Krugman is going to say it's because they didn't print enough.
Supply and Demand works for everything except manipulated interests... Gail is gone...
Ok. So the oil companies default and their assets get transfered to their debtholders and now their marginal cost to produce oil doesn't include debt service costs. And all of the sudden, the industry is profitable again. The price may not even have to rise again for profitability to return to the industry.
Making quite an unsubstantiated claim of supply and demand not working to wedge in your "peak oil" lunacy. Hold on. Let me guess, the high prices were a sign of peak oil too, right? And now the lower oil prices are a sign of peak oil?
Like the way the article introduces simple trading dynamics, and understanding of X-Y axis.
I think there's an overly+ proportionate number of people that would enjoy learning the "nut and bolts" of trading on Z/H.
When you actually see the Federal Reserve idiocy on paper, it really sticks with you. ;-)
Bingo.
Hope you're doing well.
Happy Thanksgiving, Atomizer.
I'm just taking it easy, and making some decisions.
Be well my friend. I'll be around during the Holidays this year.
I might slip to Queensland for New Years Eve. ;-)
Thank God Solyndra will make oil obsolete along with Peak Oil articles.
If only the DOE could of directed Obama in manufacturing pinwheel driven automobiles. We could rely on wind to service generating energy to turn a wind blade to get you efficiently to your slave job. Tail wind to get home is not reliable. Just work some extra hours and monitor wind direction.
My favorite is at the NADA auto dealers shagging contest.
Hillary Clinton hasn't driven a car since 1996 ...
Get your bike ready
So why does everybody always focus on blowing up the oil? Saddam in Kuweit, Russia and US blowing up oil trucks, don't care about the drivers... what's gonna' happen when Iran gets pissed enough at Saud for Yemen? They will blow the oil. With storage full and prices low, what better way to get the price up?
Iran hitting Saudi oil fields will do it... and all with Mecca in sight.
Throwing a giant monkey wrench in global trade is generally not a way to increase prices.
Well, at least I can go work at Wal-Mart if my client goes bust. The life of a landman is never certain.
You can start your own Walmart rickshaw service covering a two mile radius. All will be grand until Obama administration taxes you on the pedal mileage tax. Coasting your bike cost x3 in tax penalties.
/sarc
There is NO tax on food, but there is tax on fuel. And governments have latched onto these taxes on fuel because
that is where they get their major funding from the middle class indentured servants born into servitude to the parasites doing the backstroke in the public trough.
They just tax whatever they can get away with. This is why debate on income tax, import duties and other special taxes is not very productive. It's about total govt SPENDING (revenue is less meaningful) to total GDP. This is the chunk of economy which State has full control over, it has partial control on the other part.
Doomsday article means we might be near the bottom. If anyone is thinking of going long, try to stick with the lowest cost producers
After the small time producers get washed out and bought up by the big boys, that's when you go long.
Commodities hitting 40 year support.
Wash, rinse, repeat. Time to take down the Sandi's and ship back their terrorist.
It would only take 4 hours to invade this fucked up country. After we control the oil, we can set up prison tents in the desert without water. Let nature take its course.
"Highway of Death" Iraqi Army Armed Retreat from Kuwait 1991 ...
The Turks and Israelis control the water... convenient.
We have more water than land on this earth. It's another illusion to create a monetary fiat to reset debt under New World Order. De Beers was founded as a diamond source. Then someone figured out to create cubic zirconia (ZrO2).
Can't wait for the new robots. We can watch them being caught into the Robot stuffing channel. Robots building robots.
It will be funny to watch the deterioration of over production and no sales. We watched this movie before. Just let it happen. They will fucking jump off a roof.
Having water is one thing, controling who gets it is quite another. De-salination costs... it uses lots of oil.
Under today's technology, agreed. We will find a new solution in time. One not mandated under K Street.
Until it is "figured out" there is a lack of fresh water.
So are you engaged in the Chemistry of "figuring it out".
It casts ENERGY. While Oil is one of the mst convenient energy dense forms availavle, with nothing else on the planet able to swiftly replace it, then I suggest that you had best begin figuring quickly.
TT, do you have an opinion on Keshe?
Technology will save us then - Atomizer has it figured. Jetson's here we come!
cubic zirconia isn't diamond asshole
I'm happy that the oil cartel lowered the cost in prospective. Just upset why your fucking people don't want to live in your desert paradise.
If things are so good in the Middle East, why are people migrating from the sand to multiple climate seasons?
I swear on my mother's grave, we will create more glass in the desert sand.
4 hours. Clean up your shit. Threats of oil hike gives you a one hour window to Get the fuck out.
Not a threat, promise. You have been fucking with our USD. Stealing money and sending terrorist into Germany, Sweden, UK, and America.
Time to turn your world upside down.
Love,
United States of America
When our spouses lie and cheat on us, we leave them; when our country lies and cheats on us, we profess our undying love.
Bass-ackwards, if you ask me.
"Screwed the pooch" is the saying that comes to mind.
Ask yourself. If robots continue to take jobs in consumer consumption production who will purchase the consumer goods? If the behavior of the parasitic financial sector detroys the purchasing power of the American consumer - now seeing the EM population's hopes dwindle with the commodity crash - who will fill the void?
Killing the hands that feed you is a finite outcome.
Look. The biggest failure of the supposed oligarchs and said elitists is the repeal of the second amendment. Ergo this latest attempt to use the Paris attacks to reverse engineer confiscation.
America will never disarm. And that was the keystone to complete domination. If you think America's lifetstyle circa 1985 or 2005 is equalibrium then you are stoned. America 1864 is still doable.
Locked & Loaded. Is that such a bad thing?
Supply and demand works?? - like for gold?
I like down votes. Thanks welfare cunts.
You are welcome since I junked your post.
I am not a welfare cunt.
But I am against "spreading democracy"..er..uh...Imperialism...especially by warfare.
Thugs resort to force in order to steal.
And you believe in being a thug?
Who has been stealing from whom? We trade them empty fucking promises (US DOLLARS) for their Natural Resource (Oil).
Those promises are backed by the non existent US Production...something which we still actually did back in the 1970s, when the deal was penned, and that production which we do no more.
The NOTES are empty and unenforcable. Yet you support stealing it outright when yoi cannot steal by stealth?
And I am supposedly a "welfare cunt" because I do not support our fraud, our corruption, and our criminality?
Fuck you, you fucked up thug!!!
Don't worry - according to the abiotic crowd there are magical elves that live below the Earth's surface and produce oil ALL THE TIME ... but they stop when they've produced enough ... because it is toxic crap.
It's all fun and games until we start burning the wrong "black goo".
A chicken breast sandwich costs more than a 1/4lb hamburger. For some reason six breaded chunks of chicken cost $9 at Buffalo Wild Wings with some shitty sauce. I can get a 10oz sirloin steak, a large baked potato, bread, and a ceasar salad at Outback for $9 on Wednesdays.
Oil was stable at $15-25 for decades. Now anything under $60 means death to producers even though the cost out of the middle east is still the same as the eighties.
A fast food burger meal used to be $3.50 seven years ago, the same meal is $7.50 now.
Basically, everything is fucked up beyond recognition.
GMO crap food. Don't eat in those places. Make it yourself or find a beautiful woman who likes to cook.
at 483 Mil Barrels, there is 100 Mill Barrels more crude stocks than last year with even less demand...
at 483 Mil Barrels, there is 100 Mill Barrels more crude stocks than last year with even less demand...
Gail's been doing good work for some time
Nice post
.
Hydrogen fuel cells; Mirai-the future. And OPEC knows it.
The return on any kind of investment (human labor, US dollars of investment, steel invested, energy invested) is falling.
Kondratieff cycle.
In a general sense, and in terms of BAU, totally agreed.
My home garden and water catchment/filtration, however, have a giant ROI in labor, dollars, energy and material aquisition. Be the change you seek.
YES ... exponential growth DOES lead to collapse. and this comment was very interesting ...
"Energy available per capita has been declining for some time "
Can you tell me where you saw that data? I'm not saying I doubt you ... I'd like to see the source. No need to say this - if energy/capita starts dropping, then serious impacts on population levels will not be far behind.
one thing needs pointing out:
cost of production does fall when the price of the commodity falls, just like how cost of production also rose when the underlying commodity was rising in price as well.
feel free to check the quarterlies or earning calls of any oilers or miners, sure they are hurting, but their input costs are falling too, which is part of the reason why there aren't as many oilers going bust as fast as you think.
Some good points, and some total lapses of logic. In sum - useless article.
Fracking is too close to fu*king for my comfort. So what is the definition for fracking... Fracking is the process of drilling down into a crack before a high-pressure mixture is released.
This article contains the panacea to free markets deternination of prices ? In the absence of free markets pricing, we shall have more experiments and centralized controls? These have all been tried even to the point of Oligarchs having deformed markets with the resultant collapse in price discoveries. How clueless ?
The author appears to be severely handicapped by her assumptive paradigms. The world does not work how she thinks.
If low prices don’t rise sufficiently, they can cut off oil production quite quickly–more quickly than high prices. The strategy of selling assets at depressed prices to new operators will have limited success, because much higher prices are needed to allow new operators to be successful.
Bull fucking shit! This guy is an inflationist and understands only that higher prices lead to prosperity production, etc. Load of crap. Assets exchange hands from the weak to the strong, oil production resumes viably at $40. Of course you need some other input prices to fall as well, and from what I am seeing, this is already happening. We lived with $40 oil for the better part of 20 years. We will live with that again.
Suppy and demand only works in true free market. The only supply and demand left is human stupidity, look at how much trashes are on TV. Lots of supply, and lots of demands.
Total Keynesian crap. High prices are good due to more profits?...This is absurd. Money always adjust it's value accordingly if not manipulated. The whole problem with deflation is debt and nothing else. But debt doesn't matter ... Oh wait.
What a crap, Zerohedge !
Rubbish !
Gail knows less about economics than about Science.
No Gail, the low price of Chicken to produce has nothing to do with its price at Market. It does not help keep up with demand, rather the cost of production is a facet of the supply.
When easy to produce, a great deal of supply can be produced...
The large supply of chicken (or oil) has a clearing cost below which everyone who wants one will choose to buy it.
Because one person's supply is another's demand. Money is just a marker.
So no, the price of oil is not independent of supply and demand. It is actually in line with its cost circa 1960... Because oil did not get more valuable. Rather, currencies became LESS valuable...because their supply increased sharply.
Your proposed theory was one shared by Marx. It is called the "labor theory of value" and it has been repeatedly disproved within Marx's life time and countless times since.
Don't believe me? How much are those fancy McCain posters worth from 2008? They were expensive to make.
What about Hitler portraits from the 1930's? No? It is because price has nothing to do with production cost. People don't generally make things they believe will clear at below cost. That's all. Government is the exception...and so can prove the point.
About science...I have a challenge for you.
Make something - any something - into nothing.
If you do, then I will concede and listen to you.
For if you cannot destroy one single solitary thing then by what standard of measure is it finite??? Please note, I said 'destroy'. I did not say to convert it to something else...like burning a stick in a fire does not destroy it...it converts it to CO2, ash, oxygen, heat, and a few other things.