Your outdoor wedding is two weeks away and you're checking the weather forecast every hour. You just keep looking over and over, as if clicking on Environment Canada's web page 250 times will somehow fend off the threat of rain.
Your hockey pool is tomorrow night and you are printing out stacks of stats to complement the season-preview magazines you have pored over. Armed with up-to-date info from the best hockey minds, there's no way you're going to let your office colleague win the pot this year.
Weather and sports are two examples of forecasts we regularly rely on, even though they frequently flounder. A "chance of showers" becomes a deluge, or the co-worker who doesn't watch hockey and has never studied a stat in his life wins the office pool.
Still, we are addicted to predictions — the sales targets we're expected to reach, the economic outlook that promises more jobs, even the odd global doomsday prophecy.
No matter the topic, we indulge.
"The truth is that forecasts are like Pringles — nobody thinks that there's any great virtue in them but, offered with the fleeting pleasure of consuming them, we find it hard to resist," wrote author Tim Harford in the Financial Times.
Too tempting
If you're in Alberta these days, it's hard to avoid the Pringles. The oilpatch is trying to make sense of the downturn.
"Forecasting oil is a very difficult business. If it was easy and we were able to do it with any accuracy, we would all be on a yacht in the south of France," said Alberta Environment Minister Shannon Phillips. The government's fall budget forecast oil prices at $50 US a barrel this year and $61 US in 2016-17. Currently, prices sit just above $30 US a barrel.
Even high-level executives running oil companies aren't sure where prices will go. Imperial Oil CEO Rich Kruger admitted last May, "I don't have a clue."
Fickle markets
The variables involved in pinpointing the future for oil are just as complex as picking the next Stanley Cup MVP, if not more so.
There are layers of complexity. On a global scale there are supply and demand, geopolitics and shifting energy trends. On a local or regional level one must consider oil transportation, price differentials, quality differentials and refinery locations.
"It's a new century, it's new geopolitics, assumptions are turned upside down. We're looking at volatility, pain as well as the gain associated with world markets," said Ed Morse, the global head of commodities for Citi Research.
The convoluted situation represents a near labyrinth of possible outcomes, which doesn't seem to deter audiences at all.
This month, two different events with oil forecasters in Calgary have been packed, leading to jokes about how eager people are to hear the "good news."
Forecasters didn't see oil prices crashing this badly, and yet people are flocking to these experts to hear the new projections.
Michael Wittner, with Société Générale, explains his role as an oil forecaster1:02
Craving information
Just like in sports, the brightest minds in the industry get it wrong, over and over again.
"Certainty is difficult to come up with right now," said Michael Wittner, the head of oil research with Société Générale, in an interview with CBC News. "Far and away the goal is to try and get it right. Obviously, neither we nor anyone else I think has gotten it right so far."
At minimum, forecasters need to explain what has happened in the market to get us to the present time. The next step is the prediction.
FirstEnergy Capital's Martin King seems to enjoy playing with people's love, hate and lust for crystal ball gazing.
His presentation at a recent Conference Board of Canada event was titled "Positioning for a price recovery."
"I didn't specifically say when the price would recover," he quipped to the crowd. "I'm glad I didn't get specific about that."
These types of events are information exercises, as they methodically go over dozens of charts and graphs to tell the story of where have we been, where are we now, and where we are going to go.
Forecasts are generally serious, since much is at stake. Oil executives are trying to get a sense of where to set their budgets and possibly how to take advantage of a recovery.
"Everybody is going to have their own opinion on it, of course. But it's always good to have more information than less," said King.
ExxonMobil released its energy outlook this week, which looks 25 years down the road. The report forecasts that in 2040 the world will rely on oil for one-third of its energy, which is similar to current levels. (ExxonMobil)
Forecasts are always fraught with danger. Make a bold prediction, like economist Jeff Rubin calling for oil at $200 a barrel, and it can follow you around for years to come. But if you're only off by a little bit, you can always cover your tracks with phrases like "prices overshot to the downside."
If the energy industry's crystal ball gazing seems to need some work, it's in good company. For instance, the Hockey News, a highly respected publication, unveiled its annual NHL predictions last summer.
The Florida Panthers were set for mediocrity and to finish fifth in their division. Currently, they are first in the Atlantic. The Winnipeg Jets were said to have a 60 per cent chance of making the playoffs. Right now, they are basement dwellers in the Central.
Do we blame the Hockey News for these problematic prognoses? Probably not. Many of their predictions are right on the money. The variables in sports are numerous with injuries, trades and the like.
Besides, the masses will keep flocking back to hear the latest prophecy, the irresistible divination to make sense of where this world is headed. Right or wrong, we just can't pass it up.
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