Government to tell oil giants to use it or lose it

[Leftofcentresalterego]

It's quite simple really

It is?

You could ride a bike

Riiiiiiiight. I'll leave for work at 3am and get home in time to watch Iron Chef at 9pm. If I'm lucky. I'd be better off sleeping at work and only peddling home for the weekend.

Take the train

Did it ever occurr to you that there is no such thing as public transport for the millions who live outside major metropoliton areas? And those who do live there might still face a 50km or more walk or bike ride to the nearest train station.

Use a more fuel efficient car

Yes, I do. But a more fuel efficient car can't run on nothing. If everybody uses them, we might stretch petroleum supply out a little bit more, that's all.

Live closer to work

And how is everybody supposed to just pack up and move closer to work?

Use biofuels

You obviously didn't grasp the part where biofuels as we know them can only replace a few percent of demand. Look it up.

Extract it from coal

This one's interesting. The technology is at least proven here. But the EROEI isn't very high I think and it would be a massive undertaking to replace even a small percentage of oil with it. (My father has shares in a coal-to-liquids pilot plant in the area. He held onto them as the price kept going up and up - and then crashed. Silly bugger should have sold. How's that - a former communist party member owning shares? Just taking ownership of the means of production really.)

Use hydrogen

One of the most abundant elements in the universe. Will never run out. Is proven to work but we're still far from cracking all the problems with using it as fuel.

The doomsayers have no grasp of human ingenuity

I agree and I am not a doomsayer. I believe we will end up licking the problem. But I think you are being a head-in-the-sander here. You think we are not nearly as dependent on relatively cheap petroleum as we actually are. The modern world has been built on cheap petroleum. Extraction technology is always improving but there have been no new supergiant finds for decades and new finds are increasingly in difficult and expensive locations (extreme deep water, arctic conditions).

Oilfields have been observed to peak and then run down very rapidly. The world's largest, Saudi Arabia's Gawar field now requires constant massive injection of pumped seawater to keep the oil coming to the top.

Oil is like gold. It is a relative geological rarity and global supply is limited. The problem is, we don't know exactly how limited or just how rapidly supply will fail to meet demand in an ever-more petroleum hungry world.

[Jovial Monk]

Ahahahahaha yup, when Knob Breath tries to make a reasoned political post he ends up looking like a court fool

[freediver]

When the price here hit $1.50, did it really change anyone's life? It didn't change mine. How high would it have to go before it did? Probably not as high as the alternatives cost.

Oil just gets all the press because the price is posted up on billboards everywhere. It makes people hypersensitive to it.

[Leftofcentresalterego]

The price here hit $2.00 a litre and the extra couple of hundred dollars a pay we were paying in fuel bills was the amount that we had to reduce our discretionary spending by. 80%-90% of the driving we do is to get to work and home again. Over time, this is a drain on the economy especially since the cost of transporting goods must sooner or later increase in response to rising fuel costs. Retailers end up being forced to pay more for the goods they buy while at the same time, demand for the goods may decrease as fuel costs become an increasing portion of many people's income.

We are highly dependent on relatively cheap fuel.

Biofuels at this stage have only the potential to replace a few percent of demand - assuming demand does not grow, which it will - so biofuels cannot seriously effect the price of petroleum.

As long as there remain vast quantities of coal and iron ore, steel output can simply keep on increasing in response to rising demand. But if coal and iron ore were much rarer than they are, we would reach the point where demand would begin to outstrip supply - no matter how much we wanted more steel, we would not be able to have it because we would have run up against the existing limits of the resource. Imagine a steel-constrained world. Steel is in everything, the modern world as we know it simply can't do without it.

This is the situation we will sooner or later face with oil. We might even be on the cusp of being there now, we just don't know for sure.

The price, though extremely important, is secondary. The foremost problem is that the supply of something that we cannot do without is limited and may not be able to meet ever growing demand. Sooner or later, it would not be able to meet even static demand.

Something will no doubt replace petroleum as transport fuel one day but it is going to have to replace a colossal global petroleum infrastructure and this may not occurr smoothly if global oil supply begins to run down fairly rapidly.

[Jovial Monk]

Yes, at the $1.50/L level people did start having to switch to public transport and the like. this was marginal, but anything above $1.50 will see it happen in a big way. That is why our grocery/booze/fuel duopoly is charging customers way above market now--they won't be able to gouge customers at high levels.

I will always need my car and don't fancy cycling to work--takes too bloody long--and public transport would mean two trains or buses + bike--but at $1.50 was thinking of one of those electric bikes.

[freediver]

this was marginal, but anything above $1.50 will see it happen in a big way

They said the same thing about the $1 mark. It didn't happen.

That is why our grocery/booze/fuel duopoly is charging customers way above market now

Oh really. Can you tell us what the 'market' price should be now?

but at $1.50 was thinking of one of those electric bikes

What's the fuel efficiency rating of your current car?

from lefty:

The price, though extremely important, is secondary. The foremost problem is that the supply of something that we cannot do without is limited and may not be able to meet ever growing demand. Sooner or later, it would not be able to meet even static demand.

But it is the price that determines the demand. There is no measure of demand that does not involve a price. It is not absolute.

[Jovial Monk]

yes, really! The price of petrol should be under $1. Do a bit of a Google.

And I said behavior WAS changing at $1.50!

[Leftofcentresalterego]

"But it is the price that determines the demand. There is no measure of demand that does not involve a price. It is not absolute"

I would say that demand first determines the price although it can work both ways. If the price of something goes high enough or low enough due to x factors, demand itself may be affected.

But all this is irrelivent to the bottom line here. If you cannot do without something, you cannot do without it. If the price of plasma screen t.v's goes too high, demand will fall - we'll just stop buying them because we can do without them. But the same does not go for something like petroleum. You either pay the price or the bulk of your transport system simply grinds to a halt.

Oil is like the talent on the fibs front bench - everyone can demand that more be squeezed out but if more isn't there, then it simply isn't there.

[freediver]

yes, really! The price of petrol should be under $1. Do a bit of a Google.

Well if google says so, it must be true. Maybe it's time for the government to set the price, in the interest of a free marketplace.

I would say that demand first determines the price although it can work both ways. If the price of something goes high enough or low enough due to x factors, demand itself may be affected.

You can't have one without the other. The term demand is meaningless on it's own.

But all this is irrelivent to the bottom line here. If you cannot do without something, you cannot do without it.

But the bottom line is price, not absolute necessity. And we can do without it. Oil is not food, water, or shelter. Only a tiny fraction of our transport system is dedicated to necessities.

[Jovial Monk]

Oh man.

Oil is in everything! Fertilisers made from oil, oil (diesel) drives the tractors etc, oil is in the plastics the food is packed in. Oil is everywhere! Re shelter, oil drive the brickyard kilns, goes into the PVC plastic water tubes, the electric cable insulation, the nylon carpet on the floor etc etc.