I had an interesting message on the message board yesterday claiming that the rising cost of oil was a 'bubble'. Sorry to bring economics into this blog, but it is my degree subject and somebody else started it, and I don't believe we should leave false statements unchallenged!
In a bubble demand continues to increase as supply does, demand keeps just short of supply - otherwise of course the bubble would burst.
But look at the Supply Versus Demand chart above (for oil) courtesy Moneyweek magazine. (full article) .
I'd recommend Moneyweek to anyone who wants a fresh view on economics, finance etc! It knocks the staid and leftie Economist into a corner!
The blue line continues to rise, but the red line (supply) actually starts falling slightly from its height in 2005. It may well be that 2005 was the year of Peak Oil - this chart certainly seems to support this.
Even our unelected prime minister Gordon Brown today admitted that oil will now become scarcer and scarcer. This will all have an effect on future government policies, which will inevitably (now the cat's out of the bag!) revolve around increasing public transport provision as road traffic contracts due to the ever-increasing cost of fuel. That can only be good for the S&D. We're not asking much, only that planning permission is automatically granted for rail reinstatement and that the cost of land is pegged so that the reinstatement can proceed quickly.
And for those (non-economists) who insist we'll all be driving electric cars in the future - forget it, it's a pipe dream. Our electricity generating capacity is already under great strain, this will only get worse as oil becomes scarcer and the Chinese buy up all the coal and uranium. There are of course renewables, but these will also be affected by rising commodity costs. If lucky we'll be able to maintain generating capacity, though it's going to be a big challenge and will require about 20 new nuclear power stations. But the idea we'll all be able to drive magical little Noddy cars is a fantasy, cruelly encouraged by the media and some politicians. In any case the road infrastructure itself will begin breaking down soon, as the oil for asphalt becomes scarcer and more expensive, and first lorries, then cars, then buses begin to vanish from our crumbling roads.
The outlook for the S&D has never been brighter.
8 comments:
umm steve hate to point this out, but what are we going to make rails from, because from what i know you need to smelt steel, so umm.... that means you need a source of heat to my knowledge
Jeff
LOL! Who's claiming that ALL energy sources will vanish? We'll use coal, charcoal or wood to smelt steel, the same way we always have.
This daft idea that once oil runs out we'll go back to the Stone Age is hilarious. Remember that railways first came about well before oil or electricity were used.
Railways will pretty much go on as before, though much more widely used and probably a lot more steam (and MUCH less diesel) around.
Jeff has a point but as this run down foreign owned country has no industry that is british owned anymore, who is going to build the steam engines ?
Also, all the brains of the country that we had in the 40's, 50's and 60's have gone. We had people who could design planes, tanks, steam engines etc etc that were light years ahead of the rest of the world. But as we sold everything off, well, what can i say.
You ask these kids from university to design something and they would not have a bloody clue what to do. The only thing that they an make is burgers at mac sodding donalds.
We have a long way to go and i am afraid we need to start doing things now before the oil drys up.
Oh yes Jeff, if you need a source of heat, use candles. lol
there is one more point i'd like to make... you also said that the price of coal will also rise very quickly
and according to a source at the swanage railway, the price of coal has risen for them by 50% over the last three years so thats not exactly going to be a cheap solution either
Jeff
Nice to see your blinkers are beginning to come on!
The proce of coal is increasing as it can in many cases be used as a (dirty) subsitute for oil. China in particular is opening one new coal-fired power station every week, the US is also expanding its use of coal as it gives them a degree of energy independence.
No one said coal would be cheap, far from it. There will be a switch from diesel to steam on many of the world's unelectrified railways, electrification involves hige infrastructure costs and, you've guessed it, the cost of electricity generation will also move in step with the price of oil.
This is nothing new to those of us in the Peak Oil 'community', we've been forecasting it for years, but it's only now, as the person in the street sees it actually happening, that the message is getting through.
The future's going to be an expensive place for us all - and this is just the beginning ...
Sorry Jeff - I meant of course OFF, not on!
No one says you have to run a steam engine on coal. There are examples around the world that run on wood, peat and charcoal, and indeed some that run on compressed sawdust or organic rubbish pellets.
Now there's an idea... a rubbish powered train! You can kill two birds with one stone.
Whens this so called new 5AT locomotive going to be finnished that will be an eye opener for alot of people when that flies past at a stupid speed.
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