This article plays down the role of substitutes for petrochemicals and ignores the role of increasing the "productivity" of oil (increasing miles per gallon of cars, using public transportation, etc.) If our fearless leaders were smart -- or even as smart as the Europeans -- the government would actively promote the search for substitutes and encourage greater oil productivity. Both of these would reduce the demand for oil, so that the declining supply would be no big disaster.
Of course, under _laissez-faire_ (i.e., blatantly pro-business) capitalism, this kind of rational solution is close to impossible. The system will likely "over-shoot," increasing the demand for oil at a time when the supply is falling, causing a spike in prices, both of the explicit money price and of the price to the environment. ------------------------ Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > -----Original Message----- > From: Jurriaan Bendien [mailto:[EMAIL PROTECTED] > Sent: Thursday, October 02, 2003 4:42 AM > To: [EMAIL PROTECTED] > Subject: [PEN-L] The oil and gas situation, according to the expurts > > > World oil and gas supplies are headed for a "production > crunch" sometime > between 2010 and 2020 when they cannot meet supply, because > global reserves > are 80 per cent smaller than had been thought, new forecasts show. > > An analysis presented this week at the University of Uppsala in Sweden > suggests that oil supplies will peak soon after 2010, and gas > supplies not > long afterwards. That will make the price of petrol and other > fuels rocket, > with potentially disastrous economic consequences unless > people have shifted > to non-oil-based supplies. > > While forecasters have known that such a date lies ahead, > they have always > put it around 2050, and reckoned there is time to shift > energy use over to > renewables and other non-fossil sources. > > But now Kjell Aleklett, one of a team of geologists who prepared the > estimate, said that earlier estimates that the world's entire reserve > amounts to 18,000 billion barrels of oil and gas - of which > about 1,000 > billion has been used up so far - are "completely unrealistic". > > Instead, he and Anders Sivertsson and Colin Campbell told New > Scientist > magazine that they reckon that less than 3,500 billion > barrels of oil and > gas remain in total. > > Commenting on the work, Dr James McKenzie, senior assistant > on the climate > change program at the World Resources Institute in > Washington, DC, said: "We > won't run out of oil - but what will happen is that > production will decline, > and that's when all hell will break loose." > > Present oil consumption is about 25 billion barrels of oil > annually and > shows no signs of slowing down. That would suggest a > "production crunch" - > where consumption grows to meet the maximum output - within > the next couple > of decades. > > Dr McKenzie said that on this topic the argument splits > between economists > and geologists: "The economists think that it will just force > the price of > oil up, which will mean that it will become economic to > extract it from all > sorts of unusual places, such as tarry sands or deposits > which are 90 per > cent rock and 10 per cent oil. > > But the geologists say - you tell us where the deposits are > and we'll find > them. But we've looked and we can't." > > One side-effect of having lower oil reserves might be that the worst > predictions of climate change would be forestalled - because > there would be > less fuel to burn and put the greenhouse gas carbon dioxide into the > atmosphere. > > In fact, the Uppsala team's estimates are lower than any > considered by the > International Panel on Climate Change (IPCC), whose minimum > estiimate for > the total reserves was 5,000 billion barrels. > > But Nebojsa Nakicenovic, an energy economist at the > University of Vienna in > Austria, who headed the IPCC team that produced the reserves > forecasts, said > that the Swedish group were "conservative", and that his team > had taken into > account a wider range of estimates. And, Dr Nakicenovic > pointed out, if oil > and gas begin to run out, "there's a huge amount of coal > underground that > could be exploited". > > However Dr McKenzie said: "We have to accept the fact of oil and gas > production peaking, and get concerned with substitutes. It's > not when will > we run out, it's when will production be unable to meet > demand. And 97 or 98 > per cent of transport depends on it. You can use coal to make > methanol to > power your cars or buses. But the reality is that it's all > about where the > oil is." > > The Persian Gulf countries - Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi > Arabia, and the United Arab Emirates - produce about 25 per > cent of the > world's oil, and hold 65 per cent of the world's oil reserves. > > "That's why we went to war in Iraq," said Dr McKenzie. "Gas might have > comparable reserves to oil, but it's not in the right place > and we don't > really have the infrastructure to transport it." > > http://www.nzherald.co.nz/latestnewsstory.cfm?storyID=3526640&; thesection=bus iness&thesubsection=latest
