Comment on Belmont's "Venezuela and Peak Oil"
In a post entitled "Venezuela and Peak Oil", Wretchard reported on several recently economic policy initiatives and developments in Venezuela - tight price controls on retail prices, booming automobile sales, and a decision to provide cheap heating oil to poor Americans. He remarked that:
These can be taken as indicators of the superiority of the socialist system of economics over dog-eat-dog capitalism. Or they can be seen as an economic disaster waiting to overwhelm Venezuela the moment current oil prices begin to decline. But according to leftish Alternet, 2006 may mark the year that world oil supplies begin their irreversible march upward, according to the Peak Oil scenario (also here), in which case Hugo Chavez can keep up his weird economics indefinitely on the back of steadily rising oil prices. But when prices rise sufficiently other sources besides the conventional become profitable to develop. CBC predicts that with prices rising, oil sands will be the energy source of the future.
My comment was as follows:
It is interesting that you now bring up this topic. As you are aware, there is a very important Climate Conference underway in Sydney today, the Asia Pacific Climate Conference. The six countries in attendance are the US, Japan, China, South Korea, India and Australia, the world's six largest producers of greenhouse gases. To hear the MSM tell it, these countries and their energy industry and governmental leaders are following a very incremental strategy, preferring to spend more on making existing technologies cleaner than on renewable resources. As one might imagine, Greenpeace is not pleased with these priorities.None of the articles I read pointed to the issue you raised, i.e. how rising prices may increase global oil reserves by making some kinds of them, e.g. oil and tar sands, more economically feasible. This oversight is not a small one. As the "Dirty Half Dozen" make plans to reduce global greenhouse gas emissions without adhering to either specific timetables or Kyoto protocols, one wonders what will become of these best laid plans if oil prices continue to rise or if various "peak Oil" scenarios come into play.