Eva Sprunt, President of the Society of Petroleum Engineers, writes in the April 2006 edition of JPT that the cure for high oil prices is high oil prices. She debunks the idea that oil is running out and welcomes the high oil price as a way to ensure that more marginal fields will be produced and that alternatives will be found.
It is not right that we should berate our energy industry. It is vital to our lives; we are all a part of the demand side, the supply side, or both. We depend on hydrocarbons to grow and transport our food, move us (or our friends, colleagues, suppliers or customers) about the planet and in myriad other ways. However, this short-sightedness by a senior member of the oil and gas industry (and similar comments by Exxon-Mobil) is not helpful.
Whether there is any oil left in the ground or not is not the issue. The problem is the price of getting it. If the cure is also high prices, that is a reason not to rejoice but to be dismayed.
Higher prices will no doubt help develop alternative energy sources in a way that no amount of government coaxing could. We may well leave half the oil in the ground as we find a better fuel or feedstock. However, if the price rises are too fast and we blight the lives of people unable to change their economic situation quickly enough, the battle is already lost. Our property prices, industry, service businesses and transport infrastructure have evolved under relatively stable energy prices for too long. Our co-dependencies are too great for a significant and rapid price increase to go un-noticed.
Higher prices might also help mitigate pollution and climate change. This will be, at best, a happy side-effect. The oil industry is busy developing heavy oil, shale and tar sand sources that produce more CO2 than lighter oils per unit of energy. The will to mitigate climate change is too weak and the evidence not widely accepted. Our efforts should be in learning how to live with higher sea levels and perhaps more extreme weather - whether naturally or un-naturally occurring, both seem more likely in the future. Raise the Thames Barrier and don't buy property seaward of it.