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<DIV><FONT face=Arial size=2>from today's letters pages in the CT:</FONT></DIV>
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<P>Oil pessimists
<P>Jenny Goldie worries the world is almost out of oil, fearing it'll get really
expensive soon. Antony Barry is concerned Australia won't be able to import
crude and that Canberra will be among the hardest hit (Letters, June 28).
They're pessimists.
<P>There are reasons why the oil price could fall significantly. And anyway,
high crude prices won't stop car use.
<P>In addition to sustained, strong global (especially Chinese/Indian) demand,
oil's high price includes premiums for confrontation with Iran, chaos in Iraq
and instability in several other supply countries. Any of that could change
tomorrow.
<P>For example, sharemarkets are jittery right now about a possible US/global
slowdown. Oil demand would follow. But it's on the supply side that the big
responses can be predicted.
<P>Until fairly recently, oil was expected to keep on averaging around
$US25-a-barrel ($A34). We are yet to see the impact of sustained
$US50-plus-a-barrel ($A68) prices on global production.
<P>In addition to rendering viable tar sands, shale, gas/coal-to-liquids, etc
options, high prices have seen rapid application of technological advances in
exploration and well recovery, every drilling rig in the world working and every
Russian, Central Asian, deeper-water, smaller-field option being diligently
investigated. Supply will rise substantially.
<P>Simultaneously, with increasing confidence that $50-oil is here to stay and
reduced fuel security comes accelerated fuel substitution.
<P>Canberra's new cars will be much more fuel efficient. Increasing numbers will
use electricity and hydrogen/fuel cells. All manufacturers have them ready now.
<P>Jenny, Antony and others will buy them. Canberra needs to plan the
infrastructure for them.
<P>Tom Waring, Ainslie
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