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<DIV><FONT size=2><STRONG><FONT size=3 face=Arial>The cost of cheap
oil</FONT></STRONG></DIV>
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<P><FONT face=Arial>Clancy Yeates tries to persuade us not to worry about low
oil prices ("Oil shock not as scary as it looks," BusinessDay, January 25), but
at least he acknowledges it is not all good news.</FONT></P>
<P><FONT face=Arial>It is very bad news indeed for oil exporters.</FONT></P>
<P><FONT face=Arial>The main worry with low oil prices, however, is that
governments may be deterred from making the transition from fossil fuels to
renewable energy. This transition is critical if we are to meet our
climate-change objective of limiting global warming to 2degrees or, ideally,
1.5degrees.</FONT></P>
<P><FONT face=Arial>Last week, the executive director of the International
Energy Agency, Fatih Birol, stressed the importance of this transition, in
association with greater energy efficiency, if we are to avoid catastrophic
climate change.</FONT></P>
<P><FONT face=Arial>Birol also said he expected oil prices to remain low through
2016, but 2017 would see the beginning of a "rebalancing"; that is, a return to
higher oil prices. That may prove a shock to those who have recently bought
petrol-guzzling SUVs, but not to those who have invested in electric vehicles,
hybrids or bicycles.</FONT></P>
<P><STRONG><FONT face=Arial>Jenny Goldie, Michelago, NSW</FONT></STRONG></P>
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