Brace for $100-a-barrel oil

Sacrifices required to put in place a national policy for energy alternatives

Are Americans willing to live with $100-a-barrel oil prices, which could translate into $6-a-gallon gasoline and heating oil? They may have no choice. It could happen as soon as five years from now, according to some energy experts. The price for a barrel of crude has nearly tripled in three years, from $25 in April 2003, to over $72 today.

But the more crucial question is this: Are Americans and their political representatives willing to make the individual and collective sacrifices needed to come up with viable mass-market energy alternatives to heat our homes, drive our cars and run our industries? They would have to accept the unpalatable prospect that a concerted national push for alternatives to oil will be neither cheap nor easy, and it won’t generate significant results for quite some time, even when such alternatives are made to work.

With global demand for oil rising much faster than supply, competition for this precious resource will continue to put enormous pressure on prices. The rapid industrial growth of China and India alone is already responsible for much of the price increase that’s shocking motorists at the gas pumps today. And the International Energy Agency (IEA) projects that the world’s total energy requirements will rise by half in the next 25 years – an increase that will be unsustainable at the rate oil is being produced today.

No, the world is nowhere near running out of oil soon. But there is a general agreement that it’s close to reaching peak oil production – a plateau after which production will begin to decline. It’s a geological reality that won’t change. As supplies of oil easily pumped from existing wells dry up, costly and complicated processes will be needed to extract oil trapped in shale and oil sands, or to liquefy coal into synthetic fuels. The result will be ever-higher prices for a shrinking commodity.

NY Newsday