Energy Crises: Past, Present and Future
Remember the energy crisis of the 1970s? The New York Times reports that this one is different:
Unlike past oil shocks, which were caused by sudden interruptions in exports from the Middle East, this time prices have been rising steadily as demand for gasoline grows in developed countries, as hundreds of millions of Chinese and Indians climb out of poverty and as other developing economies grow at a sizzling pace.Permanently higher prices will not be confined to oil. The International Energy Agency (IEA) has released its World Energy Outlook, which projects that overall energy demand will increase by 55 percent by the year 2030. The IEA projects that demand for coal power will increase 73 percent by 2030. A fixed supply and growing demand adds up to sharply higher coal prices, which will be driven even higher by the cost of carbon emission controls.
“This is the world’s first demand-led energy shock,” said Lawrence Goldstein, an economist at the Energy Policy Research Foundation of Washington.
posted by Tom Noyes at 7:33 AM
2 Comments:
When the Chinese and Indians start buying up all our wind,....how will we breathe?
Joking aside, todays gasoline prices are somewhat driven by demand, but market manipulation is the major cause. The nation is experiencing as a whole, what California did in 2000, when prices rose because of energy shortfalls. With the downfall of Enron, records proved the shortages were manipulated.
Today, events.....caused by policies emanating from the Blair House, are responsible for shooting oil to higher levels. If we were not actively speculating on which day we were invading Iran, oil, though high, would be at least 20 dollars cheaper.....
Politics modifies economics....until a shift in economics metamorphoses politics..
There will be wars and rumors of wars, and shady characters seeking to game the market. Traders can manipulate markets for a time, as they did to California.
But the fundamental economics of rising demand will be relentless and inescapable. No trader or poltician will be able to roll back the inevitable price increases.
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