Ten Notes on Crude
David Merkel has a good Sunday morning read posted Ten Notes on Crude Oil: The Fixation:
In different economic eras, different things attract the attention of the media, investors, politicians, etc. Today a leading attention grabber would be crude oil, and the energy complex. It is a honeypot for conspiracy theorists and unscrupulous politicians (not quite an oxymoron).
Reading all 10 this morning is a worthwhile exercise.
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Previously:
The Costanza Energy Policy: 25 Ways to Drive Oil to $150
http://bigpicture.typepad.com/comments/2008/05/how-to-drive-oi.html
Sunday, June 15, 2008 | 09:14 AM | Permalink
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Probably the single most important geopolitical development of the past 30 years is the emergence of China and India as trading nations. Hundreds of millions who had barely participated in the currency economy are now entering the middle class. But this development is mostly taking place using the energy-intensive example of the West.
If energy supplies were highly elastic, the rise of China and India wouldn't have been a big deal. But energy, from exploration to refining, is a capital-intensive business. And as Merkel noted, many countries impose below-market energy prices which subsidize consumption.
The ultimate question, which receives surprisingly little attention, is whether a global population of 7.5 billion now -- or 9 billion in 2050 -- is sustainable. The question is exceedingly complex, and there is no more consensus on the answer than there is on climate change (which would affect the answer). But if the subject is placed off-limits for debate, then the extrapolated future looks like an endless treadmill where you have to run faster and faster finding oil and gas to support the rising population and rising living standards of the developing world, without making progress on affordability.
Doesn't leave much margin (if any) for rising living standards in the 'rich countries,' does it?
Posted by: Jim Haygood | Jun 15, 2008 10:11:55 AM
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