The price of oil, now playing around $118 a barrel, has finally registered with the general public now that the price of a gallon of gas is pushing $3.75. A recent New York Times piece, “The Big Thirst,” attempted to put the shock at the pump into a global context. According to the feature, the image of China”™s and India”™s rising need for oil is contributing to the future uncertainty of our oil supply. Nonetheless, there are still those who claim there”™s plenty of oil ”“ we just have to find it. In point of fact, despite spending $100 billion on exploration last year, the five largest international oil companies found less oil last year than they pumped out of the ground, meaning we have reached “peak oil” and we are on the downward slope already. In the Times article, William Chandler, an energy expert at the Carnegie Endowment for International Peace, said five more Saudi Arabias would be required if the Chinese matched the current energy thirst of Americans ”“ which they seem to be determined to do.
A front page feature in The Journal News focused exclusively on the high cost of gas and what people are doing to cope. An accompanying graph shows that, taking into account the effects of inflation, the current cost of a gallon of gas is barely above what it was in 1980. What has changed is the number of gas guzzlers on the road as well as the increased driving per person, making the price the more onerous.
The real issues?
Then there was the recent Regional Plan Association”™s annual assembly. The RPA, around since 1922, became the bane of Robert Moses as he attempted to redesign New York City and its environs 50 years ago. RPA produces regular treatises on regional development and green swards but when it comes to major construction projects it focuses on Manhattan.
The Second Avenue subway ($16 billion plus), East Side access for LIRR (billions), extending the #7 subway line and, of course, the Access to the Region”™s Core (ARC), the second tunnel into Penn Station, mercifully paid for by the Port Authority and New Jersey Transit (hopefully).
When this year”™s RPA assembly”™s mailer appeared ”“ “Oil and Water-Adapting to Scarcity” ”“ there was hope a prominent regional organization would actually deal with the reality of impending unaffordable or even scarce oil. As it turned out the main topic of the assembly was the need to rebuild our infrastructure and strategies for paying them, a noble and necessary cause for sure. The usual RPA topics ”“ transportation, environment and economic development ”“ were examined but the apparent theme of the assembly, dealing with scarcity, never surfaced. The emerging stress on the public of unaffordable fossil fuels in the metro region and possible solutions were not addressed.
The Columbia Journalism Review dealt with the reality of “peak oil” in its April 2, 2008 issue. Titled “The Silent Side of Oil,” Katherine Begley surveys the ways in which this unmentionable topic has skated by the attention of editors who should really know better. A stunning opportunity was ignored by the press when President Bush attempted to pressure the OPEC countries to increase production to take the pressure off the U.S. economy. The press, though seemingly surprised by the reality of $100-plus oil, was not stirred to find out why. The culprit for these outrageous oil prices was the falling dollar, investors, low interest rates, lack of refining capacity and, of course, the voracious oil companies.
No ”˜easy”™ answers
To be fair, policymakers, elected officials and the press are faced with an excruciating dilemma ”“ how to confront the reality of peak oil, that there will be diminishing available oil, that which runs this economy, at a time when the U.S. depends on consumerism upward of 70 percent. To prepare for tough times conservation must be the rallying cry to make what we have last longer. That runs completely counter to the basic drives of a consumer society. Peak oil has put this country between the proverbial rock and a hard place.
There is a further twist to the epic saga of the century. Oil consumption in the OPEC countries, the major oil producers, as well as Russia and Mexico, is on the rise ”“ the high price of oil is giving these countries a dramatic boost in their economies ”“ hence more oil consumption at home, just when the supply may be headed downward. This being the case the OECD countries (Organization for Economic Cooperation and Development), 30 of the developed democracies of the world, will be in the very near future second in line for precious oil, after the countries that actually own the crude use what they need. The story is, of course, far more complex. The “easy” oil has already been pumped up. What remains is far more difficult, costly and time-consuming. Stay tuned.
