America After Oil

• Views: 1,134

George Will makes some interesting points about the oil supply: America After Oil.

OIL produced the modern world — its ways of work, warfare and recreation — and soon, we are told, the end of cheap oil will produce abrupt, wrenching changes in the way we live. Changes, certainly, but not convulsions, because the modern world responds to price signals.

That is why U.S. energy efficiency — energy consumed to produce a dollar of GDP — has roughly doubled since the oil shocks of the 1970s. America’s less than 5 percent of the world population consumes more than 20 percent of all oil. Surging demand by India and especially China will cause prices to rise. And terrorists, or chaos in Venezuela (America’s fourth-largest supplier, behind Canada, Saudi Arabia and Mexico) or Nigeria (the fifth-largest) could cause prices to soar.

However, in 1920 the inflation-adjusted price of gasoline was twice today’s. To match 1981 prices, a gallon of gasoline today would have to be $3.50. Inexpensive gasoline is one reason why since 1988 the average gas mileage of U.S. passenger vehicles has declined, and why in the 2003 model year, for the first time since the mid-1970s, the average weight of a new car or light truck was more than two tons (4,021 pounds).

In 1977 President Carter said we “could use up all the proven reserves of oil in the entire world by the end of the next decade.” But today known reserves are larger than ever. Reserves and production outside the Middle East are larger than they were 31 years ago, when a State Department report was titled “The Oil Crisis: This Time the Wolf is Here.”

In 1971, a year before Texas output passed its peak, U.S. production was more than two-thirds of the nation’s needs. Today the nation imports 54 percent of the oil it uses. M.A. Adelman of MIT notes that in 1971 non-OPEC countries had about 200 billion barrels of proven reserves. In the next 33 years they produced 460 billion “and now have 209 billion ‘remaining.’ ” Note Adelman’s quotation marks. To predict actual reserves would require predicting future exploration and development technologies.

However, the rate of discovery has been declining for several decades. Of course, oil supplies are, as some people say with a sense of profound discovery, “finite.” But that distinguishes oil not at all from land, water or pistachio nuts.

Russell Roberts, an economist, says: Imagine that you love pistachio nuts and are given a room filled 5 feet deep with them. But you must eat them in the room and must leave the shells. When will you have eaten them all? Never. Because as it becomes increasingly difficult to find nuts amidst the shells, the cost of the nuts, in time and effort, will become too high. You will seek a substitute — pistachios from a store, or another snack.

Jump to top

Create a PageThis is the LGF Pages posting bookmarklet. To use it, drag this button to your browser's bookmark bar, and title it 'LGF Pages' (or whatever you like). Then browse to a site you want to post, select some text on the page to use for a quote, click the bookmarklet, and the Pages posting window will appear with the title, text, and any embedded video or audio files already filled in, ready to go.
Or... you can just click this button to open the Pages posting window right away.
Last updated: 2023-04-04 11:11 am PDT
LGF User's Guide RSS Feeds

Help support Little Green Footballs!

Subscribe now for ad-free access!Register and sign in to a free LGF account before subscribing, and your ad-free access will be automatically enabled.

Donate with
PayPal
Cash.app
Recent PagesClick to refresh