New at Reason

January 5, 2007

Ronald Bailey reveals how a few nasty governments are making peak oil seem closer than it really needs to be.

Comments

thoreau|1.5.07 @ 9:12AM|#

Given the corruption of so many oil-producing countries, I wonder if a little bit of artificial "peak oil" (brought about by the inefficiency of state-run firms) might be a blessing. Just a bit, mind you, I wouldn't want economic collapse. But if a few governments ran out of oil money, and had to reform as a result, that wouldn't be such a bad thing.

I'll shed no tears if Putin, Chavez, and the House of Saud run short on cash.

|1.5.07 @ 9:17AM|#

I knew it! Not only without government would be all be rich and happy, but the oil would flow forever.

|1.5.07 @ 9:19AM|#

yes, thoreau, I took the news of Iran's oil troubles as good. When you consider that, General Wes Clarks comments about diplomacy with Iran (next post up), sound a little more reasonable.

thoreau|1.5.07 @ 9:20AM|#

Matt, I'm not touching the next post up with a 10 foot pole.

thoreau|1.5.07 @ 9:21AM|#

Libby Tarian | January 5, 2007, 9:17am | #
I knew it! Not only without government would be all be rich and happy, but the oil would flow forever.

You can always burn straw to heat your home.

|1.5.07 @ 9:24AM|#

Why would I want to heat my home? Winter is a thing of the past, thanks to global warming...a nice benefit of capitalism.

|1.5.07 @ 9:31AM|#

I'm not sure what Ronald's point here is beyond stating the obvious regarding state-owned vs privately-owned oil companies. And I don't have a problem with him owning Exxon stock.

I take his positions on ecological and environmental issues with a grain of salt but thank him for the input. He's an excellent journalist.

Still, I'd ask, "Doesn't the info in this article put one in the same camp as people wanting change for environmental reasons?"

Don't these very realities make looking for alternatives to fulfill our current energy needs a smart thing to do?

25 years is not that long in terms of developing and transitioning the world to new technologies. Most of our cars will last at least half of that period of time.

Additionally, the fact that extracting the oil will only get harder and more expensive doesn't make dogged determination to keep everyone dependent on oil sound very wise.

And on top of all that, shortsighted governments are looking to put the squeeze on us. Surprise, surprise.

Doesn't all of this make looking for new, non-petroleum-based energy possibilities a good thing?

|1.5.07 @ 9:47AM|#

madpad: If markets already take such political risks as I discuss into account (I think that they do) I expect that research and development will proceed in a more or less orderly fashion to find alternative sources of energy supplies. As Jesse Ausubel has pointed out, humanity has been on a path of energy decarbonization for the past 2 centuries. The question is do you think that government bureaucrats know better than billions acting in markets about which energy sources to pick for R&D? All that being said, there is the concern that as oil supplies become tighter, that humanity will choose to burn cheap (high carbon emitting) coal to produce energy. But then again that may not matter if those emissions can be sequestered cheaply by pumping them underground.

|1.5.07 @ 10:00AM|#

Speaking of markets, oil is down, what, 30% from its peak price, to the mid-$50s.

|1.5.07 @ 10:25AM|#

Ron, Thanks for the link to Ausubel's article. Don't know if I share his enthusiasm for Hydrogen, though I used to, until I had my science training in college. I think we may well find other energy solutions over the coming years and I suspect ones less dependent on single sources. I'm not pooh-poohing Hydrogen, just saying it's neither a panacea NOR the only option.

And you should notice I never suggested that government bureaucrats were better than the market. I only suggested that some of the environmental concerns may well dovetail with rational energy policies.

We can't get away from policy. It is indemic to our nation's way of government. But we can influence it. My assertion in that direction, is that Bush's anemic and oil-focused energy policies have been antagonistic towards environmental issues and by extension, have done little to prepare us for some of the realities in your article.

It's all fine and nice to point out how irrational environmental advocates can be. We know that. But energy companies - principally petroleum producers and the politicians who cater to them - can be pretty irrational too.

After all, as long as they get subsidies from the U.S. government, they are still insulated from market forces and are thus prone to making irresponsible decisions. In fact, they have already used their own influence on policy to thwart or control market-based energy changes. (Cheney's Energy task force, anyone?)

In the end, extremist screaming at each other accomplishes nothing and almost always leads to some sort of backlash.

My ultimate point is that climate change and environmental issues aren't going to go away just because you think they're stupid. Anyone (as I do) who lives in an area with high rates of respiratory illness and a fouled river system isn't going to give people who deny the reality of environmental impact much credence. Solutions are going to come about because forces on both sides move to some common ground. I only suggested that your article provided some of that groundwork.

uncle sam|1.5.07 @ 11:02AM|#

Why would I want to heat my home? Winter is a thing of the past, thanks to global warming...a nice benefit of capitalism.

Of course, communist and socialist economies don't emit CO2, nitrogen compounds, or particulates.

|1.5.07 @ 11:30AM|#

"...as long as they get subsidies from the U.S. government, they are still insulated from market forces and are thus prone to making irresponsible decisions. In fact, they have already used their own influence on policy to thwart or control market-based energy changes. (Cheney's Energy task force, anyone?)"

I think that particular effort was directed more toward protecting themselves in the market for government subsidies.

|1.5.07 @ 11:41AM|#

The supply of oil is completely infinite. As more plants and animals decompose more oil is made. We will never run out. The only thing is that we have better drill anywhere and everywhere so we can all enjoy the safety benefits of an SUV.

|1.5.07 @ 11:56AM|#

Very true...I personally drive an SUV, to protect myself against other SUVs.

THartill|1.5.07 @ 12:44PM|#

Stern concludes, "Energy subsidies, hostility to foreign investment, and inefficiencies of its state-planned economy underlie Iran's problem, which has no relation to 'peak oil.'"

Me thinks Stern doesn't know what "Peak oil" is....The point where the suppliers can't bring an ever increasing supply to the market .

State-planned economies owning more and more of the worlds supply, lack of investment and the easy oil pumped first is EXACTLY what peak oil is all about.

|1.5.07 @ 1:06PM|#

Of course, communist and socialist economies don't emit CO2, nitrogen compounds, or particulates.

Capitalism is the source of all ills. Don't you know how committed China and India and Russia are to maintaining a "clean" environment? In fact, by far the vast majority of the world's environmentalists are Indian, Chinese, and Russian.

Well, okay, maybe that's not their nationality. But the vast majority of environmentalists do seem to be at least socialists. And everybody knows that socialists don't exploit anyone or anything.

uncle sam|1.5.07 @ 4:27PM|#

Perhaps collectivist emissions are natural and therefore good, while private emissions are un-natural and therefore bad.

Isn't is amazing?