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[..] I see falling gas prices as piling on to that threat, especially if it in any way reverses the falling consumption rates and increases the chances that big oil will succeed in using up every last drop in the ground.
Decreased prices may increase consumption rates, but they won't "succeed in using up every last drop in the ground". For that you need higher prices, not lower. Many have speculated that the Saudis are not decreasing production (and thus leaving the market "oversupplied") because they want the oil price to stay low enough for long enough to kill off higher-cost projects. The oil pretty much just flows out of the ground in Saudi Arabia, they have a very low cost of production, whereas new production in the U.S. and the oil sands in Canada require much higher oil prices to be profitable. Some projects are not profitable below $60 or $70 or maybe even more per barrel. Investment in such projects will dry up if the price stays low for long enough.
Cheap oil producers are walking a tightrope between too-high prices that encourage conservation, new production, and the development of alternatives, and too-low prices which of course mean a lot of lost income. Peak oil may have hit in many locations but apparently the Saudis are not constrained yet.