Towards a true price for energy

…If widget manufacturers underestimate the demand for widgets there will be a temporary “widget problem”, but the economy will carry on.

A miscalculation on the energy front will, however, have a pervasive effect, irrespective of whether it comes through as sky-high prices or physical shortages. If a global slump is induced, the main harm will be felt far outside the energy industries.

Could not the same be said of food? No. The lead time for planting new crops is far less than that required for installing a refinery, let alone commissioning an atomic power station. Moreover, despite the idiocies of farm support policies, the world food market is not nearly as much at risk from the vagaries of Russian power politics or terrorist threats as are oil and gas supplies.

Financial Express