[Peakoil] From Crikey

[Alex P]

Any responses to Crikey on this? The anti-depletionists are getting nervous.

http://www.crikey.com.au

12. Stop worrying about petrol prices


Charles Richardson writes:

I hope I'm not the only one who was struck by the contrast on The 7.30 
Report last night, where a harrowing report on the Middle East was preceded 
by an examination of the "crisis" of high petrol prices. We again heard 
John Howard saying petrol was "the greatest worry of my political life". If 
petrol prices (actually among the lowest in the world) are the worst we 
have to worry about, we surely are the lucky country.

But it seems that petrol prices are the number one concern of Coalition 
MPs. And just as the coal lobby thinks we can get clean coal technology 
without imposing any economic disincentive for use of the dirty sort, the 
honourable members simultaneously want to develop alternative fuels, but 
also stop the one thing that provides incentive for that development: 
namely, high petrol prices.

For a while now, certain environmentalists have been talking up "peak oil" –
 the idea that the world is headed for an economic crisis as oil production 
passes its peak and industry has to deal with an energy shortage. Since 
previous doomsaying of the "we're running out of X" variety has almost 
always proved wrong, I'd been putting peak oil in the same category.

After watching The 7.30 Report I'm not so sure. What generally prevents 
commodity shortages doing major damage to the economy is the price 
mechanism. As things get scarce, their price rises, and that provides 
incentives to (a) produce or discover more of them, (b) find or invent 
substitutes for them, (c) use less of them, and (d) recycle them or use 
them more efficiently. The combination of these effects minimises 
dislocation and allows us gradually to shift to different ways of doing 
things.

But if governments are so short-sighted – or just plain stupid – as to try 
to keep petrol prices artificially low, then none of this will happen. 
Instead, we'll continue happily consuming cheap fuel until we wake up one 
morning and discover we've run out, just as the "peak oil" people say. 
______________________________

Alex
O4O4873828

ACT Peak Oil
http://act-peakoil.org