New Politics in Energy?

Newsweek

WASHINGTON — The interesting question about the advent of $50-a-barrel oil is whether it signals a new era in the economics and politics of energy. To sharpen the question: Have we entered a period when, owing to consistently strong demand and chronically scarce supplies, prices have moved permanently higher? We don’t know, but the answer could be “yes” for at least one reason: China.
Americans consume almost 21 million barrels of oil a day, a quarter of the world total of 84 million barrels a day, reports the International Energy Agency. But China is now second at 6.4 million barrels a day, and its demand could double by 2020, various analysts told a conference last week held by the Center for Strategic & International Studies (CSIS) in Washington. Moreover, China will import most of its new needs; its domestic output is steady at about 3.5 million barrels a day. It’s unclear how much China’s extra demand — and that of other developing countries, especially India — will stimulate extra oil production.

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