An Interesting Oil-Related Theory

There is an excellent spread in the December issue of WIRED magazine dealing with the oil, oil prices, and alternative fuels (http://www.wired.com/wired/archive/13.12/gas.html). WIRED's piece needs to be put alongside the most recent issue of Foreign Affairs (FA), in which there is an interesting piece about the global hunt that is on by China for resources.

Here's WIRED's thesis: while it might hurt to pay $3, $4, $5 or more for a gallon of gasoline, the more expensive this stuff gets the quicker we will move beyond the fossil fuel economy to something more environmentally friendly and sustainable. Because the price of crude has been artificially cheap for so long, there has been little incentive for the large energy companies to go looking for something that works better and does less damage to the ecosphere. But the world is changing.

The FA piece begins with the words, "An unprecedented need for resources is now driving China's foreign policy... Twenty years ago, China was East Asia's largest oil exporter. Now it is the world's second-largest importer; last year, it alone accounted for 31% of global growth in oil demand." And don't forget India. India's economy is on a journey that is as impressive as the Chinese, and because they do not have China's infamous one-child policy within the next generation there will be more Indians than there are Chinese.

It didn't require the brains of a rocket scientist a few years ago to see that sometime early in the 21st Century there would be a huge increase in demand for oil. This was bound to hoist prices to unbelievable levels, and would leave those who are not looking for or at alternatives floundering the the dust. Jeremy Rifkin was writing about this in the Nineties, although his projections of moving toward a hydrogen-based economy were rather too optimistic.

I was laughed at when I bought my Hybrid three years ago (you can look back on the archives of Toward2015 and see some of the things that were said of me on this forum). Today those same folks who pulled my leg mercilessly are now sidling up and saying things like, "My Suburban gets just about 20 miles to a gallon if I nurse it carefully, I am thinking about a Hybrid next time." When I bought my hybrid, while I was definitely making a statement about the environment, I was also making a statement about my pocket book because my reading had led me to conclude that the low prices we were paying for fuel could not continue for much longer. I guess you could say that in 2005 I hit the jackpot!

However, continuing this aside, as a Christian I believe that it is imperative that we function as good stewards of God's creation that he has entrusted to us, and trying to minimize the emission of greenhouse gases is one very effective way of doing that. You can imagine my thoughts this morning when I was cut off by a guy in a huge SUV that he then gunned like crazy going up a steep hill -- on the back on the SUV prominently place were several Christian insigia! A great witness that, selfish driving coupled with an unthinking hunger for the world's non-renewable resources. I wondered if there was any consistency with the Gospel here.

Back to WIRED magazine. What the author does is to illustrate how a steady price for oil at ever-increasing levels makes more and more attractive alternative sources of energy. For example, with oil right now selling in the $30-$70 range per barrel, it is feasible to create a diesel fuel from coal, to create biodiesel from vegetable oils, and increasing ethanol production. Over $70 a barrel, where it is likely to be in coming years, methane hydrates come into play, as does hydrogen and mining oil shale, and it will be back there e'er too long, you can be sure of that.

"For the better part of a century, cheap oil has fatally undercut all comers, not to mention smothered high-minded campaigns for conservation, increased efficiency, and energy independence." When the benchmark price for crude was, as it was for years, merely $20 per barrel, none of these things had a chance of getting off the ground and nor was it worth investing in alternative resources -- most of which will do far less damage to "this fragile earth, our island home" than the gas guzzlers that so many of us drive.

Could it be that Saudi Arabia will be put out of business by the genius who works out how to transform water into its constituent atoms, releasing their power and turning themselves back into water again? Its a nice idea, and not beyond the bounds of possibility in the future, if the desert kingdom has not used up all its reserves by then.

As WIRED says, "Smile when you see the big black $3 or $4 out in front at the gas pump. Those innovators need all the encouragement they can get. Shale oil, uranium, sunlight -- there's enough energy out there for a dozen planets..."