The rising price of oil

While everyone is worrying about the price of oil, people in Ohio and West Virginia are thrilled about it.

The price of coal is, though rising, not rising as quickly as oil. So the demand for coal is increasing and the price will rise. And as the demand increases, this means jobs for people in these and other coal producing states. Surprisingly, though maybe not that surprisingly, alternative fuel prices are increasing with oil. Corn and palm oil are following oil prices. The raw materials for solar cells are also increasing at the same rate.

Yes, there are problems with coal. Though seemingly cheap at purchase, the costs of coal are distributed away from the corporations making a profit from extracting it and burning it. But that stops no one from using it. As a matter of fact, the higher prices for oil and the increased demand for coal in China are changing the economics around U.S. coal. European energy companies are willing to spend as much to transport a ton of coal as a ton of coal costs.

So what does this mean in the whole scheme of things?

Just that energy economics is more complicated than anyone knows. It is global. It has become more complicated as options have increased. There are competing needs for the same resources: Food or energy? There are people who want us to use more energy and people who want to use less. Every corporation knows that the more energy they use, the more profit there is to be made. And every energy company knows that by selling more fuels they make more money. Growth has become the way to stay in the game.

But what about when the game is over? What about when there can’t be anymore growth or even sustainability? What about when there is no more clean water? What about when all the workers are sick from the pollution? What about when the price is too high and no one can pay for the goods made with it?

What happens then?

Will the survivalists be the only ones left to support themselves? What happens when food becomes too expensive because of the energy used to grow it and to transport it to all the cities in the world and because some food is being diverted into energy? Meat, for example, is an exponential user of energy. Its prices should increase faster than the rate of energy prices. After meats, foods from further away will become too far out of reach for most people. Out of season fruits and vegetables will shrink from grocery store shelves. I do not know what happens after that. And I hope I am wrong. But we live in interesting times.

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About the author

free electron

Simply, I want the world to be a better place, for my kids and for all the other children in the world. I am in IT, understand technology, believe in the scientific method, and have made a lot of mistakes.

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