快猫短视频

HAS oil had its day? Listening to some commentators you might think so. Today鈥檚 high prices reflect the beginning of a long-term decline in the carbon-fuel industry, they argue. Future reserves are limited and too expensive to exploit. In short, the world is running out. Furthermore, they claim, this means renewable energies have reached a turning point and will soon become competitive.

They are wrong on every count. Carbon-based fuels are destined to dominate the energy scene for many decades. Renewable energies will not get much of a look-in on the open market until well into the second quarter of the century in OECD countries and well beyond 2050 in the developing world. Let me explain why.

First, the current price of oil, just below $50 per barrel at the time of going to press, is abnormally high. The long-run supply price 鈥� that is, the price at which even the most expensively produced oil is profitable for the company that supplies it 鈥� stands at around $15 a barrel. The gap between this and the market price is accounted for partly by oil-exporting countries claiming compensation for the depletion of their finite resources and partly by market speculation, which on the back of fears for the security of oil supplies from the Middle East, Nigeria, Venezuela and Russia is pushing prices up by as much as $15 per barrel. The high price will not last: a fall in demand as a result of the high prices, along with an easing of political problems, should bring it down to around $35 per barrel by early next year.

Second, there are enough reserves of conventional oil that can be economically exploited at last year鈥檚 prices to meet current demand for more than 40 years. Those analysts who claim that many of those reserves cannot be competitively exploited are wrong; their conclusions are flatly contradicted by the US Geological Survey (USGS), the world鈥檚 most important research organisation in this field, in its global assessment of oil and gas prospects, published in 2000.

The USGS assessment identifies more than 3000 billion barrels of recoverable conventional oil, of which less than one-third has been extracted so far. It also shows that there are unexploited resources in all parts of the world, with the biggest in the Middle East, the countries of the former Soviet Union, and the largely unexplored offshore areas around the world鈥檚 continents. These reserves have not been exploited so far partly because it has only recently become technologically possible to do so, and partly because there has not been the demand. Not all the world鈥檚 reserves are equally easily exploitable, but today the differential has less to do with geology than with politics and security of supply.

Of course, demand for energy is still rising as a result of economic growth and increases in population. But for the past 30 years, the rate of growth has been less than 2 per cent per year, and this is likely to continue until the middle of the century. Thereafter it will drop off as the world鈥檚 population stabilises.

Though conventional oil resources alone will not meet this demand, supporters of renewable energies should not get their hopes up. Non-conventional oil from tar sands and oil shales will play an increasingly important role after 2020 and for 30 years afterwards. Coal will also become important in some countries as the technology used to convert coal to oil products and gas becomes economically viable.

Even more important will be the massive expansion of natural gas, which will dominate the global energy picture from 2040. There is plenty of it. Known and predicted reserves will be capable of meeting rising demand for seven decades. What is more, the gas is more environmentally friendly than other carbon fuels, producing only two-thirds as much CO₂ per unit of energy as oil. It is also the most economic and reliable source of hydrogen for hydrogen-based transport technologies, and could thus paradoxically play a central role in reducing CO₂ emissions from road transport.

I should make clear that I am not an advocate for carbon-fuel economies, nor would I dispute the eventual importance of alternative energy sources. My argument is this: if governments are serious about moving to renewable energy, they cannot rely on market mechanisms to do it for them. Carbon energy sources will continue to outcompete the alternatives for decades, especially in developing countries, where the lowest possible energy costs are a prerequisite for higher living standards.

鈥淚f governments are serious about moving to renewables, they cannot rely on the market to do it for them鈥�

In the first four years of the 21st century, growth in the use of carbon fuels has outstripped growth in the use of renewables. To turn the tide, governments will have to commit larger subsidies for the development of renewable energy and raise taxes on carbon fuels. Few seem willing to do either.