The Most Pressing Issue of Our Age

Competition for diminishing oil reserves.

China's risky scramble for oil

Look at this imbalance: The average American consumes 25 barrels of oil a year. In China, the average is about 1.3 barrels per year; in India, less than one. So as the 2.4 billion Chinese and Indians move to improve their living standards, they're going to want more oil - likely more than can be produced.

That perceived shortage is setting off an intensifying scramble to tie up oil reserves around the world. So far, China has been the most aggressive player. But the competition is just getting going.

The pattern is clear. China has been weighing buying Unocal, a major US oil firm. Last month in Beijing, Venezuela's President Hugo Chávez promised to open that nation's oil and natural gas fields to China. Russia, in effect renationalizing the giant oil subsidiary of Yukos, may offer China a 20 percent chunk of the new firm. China's efforts to tie up oil and gas resources - in places such as Iran, Saudi Arabia, and Sudan - have not been cheap....

The challenge is huge. For China and India to reach just one-quarter of the level of US oil consumption, world output would have to rise by 44 percent. To get to half the US level, world production would need to nearly double.

That's impossible. The world's oil reserves are finite. And the view is spreading that global oil output will soon peak.

As a result, "the growing demand for oil is leading to a growing global conflict," warns Amos Nur, a geophysicist at Stanford University. The 1991 Gulf War, the 9/11 attack, and the current war in Iraq are skirmishes that could "pale in comparison with the looming potential conflict over oil with China....

"There is a growing recognition of future oil scarcity, or at least the end of growth," says Jim Meyer, director of The Oil Depletion Analysis Centre in London. "The challenge of producing more and more oil is getting more and more difficult."

(story found via Rigorous Intuition) Funny how they mention 9/11 there, huh?

Anyway, I have tended to have the view that the coming oil shortage will not be a huge crisis due to the way the market works. As the article points out, as oil becomes more expensive, it will force people to change and become more efficient, and further to utilize alternative energy sources more.

That is the way it SHOULD work-- if we had rational leadership in the US, that is.

Unfortunately, we have the Bush administration.

Let's really hope their vision of spreading "freedom" is not just simply fancy window dressing for a policy of attacking all the oil rich nations.

They can't be THAT crazy, can they?