In today’s economic and technological climate, the world’s consumption of oil and gas far outstrips our ability to replenish our supply. At the current rate of our oil usage, I do not believe it is possible to maintain our consumption for very long, as it would require the discovery of new fields on par with Saudi Arabia’s current supplies every decade. Even if we were able to find these new supplies and deposits, there is only a finite amount of oil remaining in the world, thus necessitating the consideration of alternative fuel sources. If the developed world continues to rely primarily on fossil fuels for its energy sources, the effects of our dwindling oil supplies on ourselves and future generations will be devastating.
According to Kerschner et al., we are approaching what environmental scientists and economists call “Peak Oil,” which refers to “the point in time when, as a global society, we have reached the maximum possible rate for petroleum extraction per unit of time” (2013, p. 1). When this happens, we will no longer be able to improve our oil production, and supplies will dwindle faster than we can replenish them. This will have many substantial effects on the world economy, creating vulnerabilities in fields such as food production and processing, transport services, shipping, mining, construction, and more (Kerschner et al., 2013). Since oil availability does not affect just gas companies, it is clear that increased oil scarcity will create tremendous vulnerabilities in most other industries, since they rely greatly upon oil and gasoline to operate their business in various ways.
Oil consumption and production has been steadily decreasing in recent years, with recent drops in oil prices being due to subsidies as we continue to tap into Saudi oil – a phenomenon that will soon reduce substantially as those reserves begin to run out (Kumhof & Nuir, 2013). Another potential problem is that solar and wind resources are limited in their substitutability with oil, since they only generate electric power and do not necessarily stand in for the power source for cars as they are currently being manufactured (Kumhof & Nuir, 2013). While we may roughly be able to address the issues of oil scarcity by finding more sources of oil, these are not guaranteed to be found, and as such we cannot simply continue operating as if we will eventually find them. This is especially true as our consumption keeps growing at significant rates, with oil demand experiencing rapid growth in all areas of the world.
In a more personalized context, the failure to find new gas and oil supplies will be disastrous for working families in both mine and future generations. As oil becomes harder to come by, prices on gasoline will increase dramatically. It will be harder for lower and middle-class families to be able to afford to fuel their cars, also hurting the automobile industry. Citizens will have to rely more often on public transit, which unfairly disadvantages people who live outside major cities or who are unable to easily reach public transit avenues like busses and trains. Fresh fruits and vegetables will also be more difficult to transport, and will become less plentiful in areas outside of their normal climate; this will have a disastrous effect on the already-subpar American diet. Manufacturing and construction will become far more expensive, meaning that roads will be maintained less often, new buildings and renovations will stall, and more. All of these varying factors will have a negative effect on the quality of life of American citizens on an individual level as the years go by and oil supplies diminish.
Some argue that we have not yet reached ‘peak oil,’ and that the effects of potential resource scarcity are so ambiguous as to make it impossible to tell what the future will be like (Smith, 2010). To be sure, there are likely other oil deposits out there for us to mine, and our existing oil supply is surely not all there is on the planet. Despite this, however, it is necessary – absolutely necessary – to begin investing in transitions to renewable sources of alternative energy. Things like solar, wind and geothermal power are proven to work, and the sooner an infrastructure is built to support those power sources on a larger scale, the better prepared we will be for a world in which oil is not available in the quantities we desire. It is very possible that our children and grandchildren will grow up in a world low on oil, and without the ability to replace it with solar, wind or other alternative power, it will also be a world much less industrialized and modernized than it is now. To that end, it is absolutely vital that we focus more on examining whether our existing policies allow us to adjust cleanly to changes in oil scarcity, as well as considering policy changes that lower the risk of oil scarcity.
Price per gallon of gasoline: $10
Monthly gasoline budget: $250
Possible gallons of gas available per month: $25
Average mileage for vehicle: 20 miles/gal
Maximum number of travelable miles, given gas cost, budget and mileage: 500 miles
Family members: 3 (Mother, Father, Child)
Father: Works at sales job 15 miles away, 3 days/week
Driving 30 miles/day, 3 days a week = 90 miles/week
3 weeks/month = 360 miles/month
Mother: Drives Child to school 5 times a day, works from home and takes care of house
5 days of 2 round-trip drives to drop off and pick up Child from school (1.5 miles away): 60 miles/month
Makes 1 trip per week to Grocery Store (4 miles away): 32 miles/month
Miscellaneous trips to Gas Stations, Social Functions, Other Stores and Trips: 48 miles/month
Total: 500 miles/month
Kerschner, C., Prell, C., Feng, K., & Hubacek, K. (2013). Economic vulnerability to peak
oil. Global Environmental Change, 23(6), 1424-1433.
Kumhof, M., & Muir, D. (2014). Oil and the world economy: some possible
futures. Philosophical Transactions of the Royal Society of London A: Mathematical, Physical and Engineering Sciences, 372(2006), 20120327.’
Smith, J. L. (2012). On the portents of peak oil (and other indicators of resource
scarcity). Energy Policy, 44, 68-78.