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Schule > Politik und Wirtschaft > Wirtschaft und Arbeit > Essay on "Future of Oil"

1. Introduction

Oil as one of the most vital resources to human kind has revealed an enormous impact not only on economy itself but correspondingly on global standards of living, political issues, etc. pertaining to the past and the future. As oil becomes scarcer the controversial question of oil depletion arises. Predicting future oil developments, optimists claim that sufficient substitutes can be found easily as distinct from the petro-pessimists who express concerns referring to rising oil prices. In order to scrutinize the issue of oil scarcity, the opposing visions of the optimist and pessimist model have to be compared and evaluated.
2. The Question of Oil Depletion
The Club of Rome displays in the report “Limits to Growth” the pessimistic view of future consequences resulting from the limited availability of oil. Basing their claims on system dynamism for prognostication, the think-tank elucidates that, due to the fixed reserves of the scarce resource oil, an economic breakdown will occur. This collapse will be revealed through e.g. a decrease in population and extreme unemployment. However, this dramatic develop-ment can be avoided only by restraining population and pollution. Nevertheless, the depletion of resources, according to the pessimists, is inevitable and only a total collapse can be evaded through binding constraints.
In spite of the above stated resource scarcity, optimists as distinct from petro-pessimists allege that oil alternatives can be found everywhere. In order to attain a considerably less dependency on oil, the substitute production has to be adjusted to large demand to maintain economic growth. Possible energy substitutes are coal, water-, wind- or solar energy or nuclear power. However, many non-conventional oil surrogates like the conversion from coal to liquid hydrocarbons are significantly less efficient and additionally, many substitutes are very cost-effective solutions or as well non-renewable vital resources itself which certainly restricts the above stated assumption of alternate accessibility. Moreover, the substitution of oil results only in a delay of the resource depletion for a few years. Therefore the approach of investing in promising alternatives is necessary but does not lead to a considerable independency on oil.
Furthermore, the optimistic view underestimates the importance of the population growth whereas the Club of Rome clearly emphasizes the impact of the increasing population. In the pessimistic approach it is defined as a dominating positive feedback loop which reinforces the vicious circle of oil scarcity. As population grows, demand and therefore oil consumption increase. This development is currently depicted in nations like China with upcoming economic growth combined with population increase. Consequently, rising industrialization and population growth in conjunction lead to a sooner resource exhaustion.
However, the optimists seek to interpret the development of the population as a negative, self-restricting feedback loop. Therefore, the consequences of increasing population such as higher pollution due to rising resource consumption and industrial production will lead to higher death rates. This reveals a self-regulating process, which in the end adjusts the oil consumption so that the notion of oil depletion is neglected.
Nevertheless, the Hubbert Curve, supporting the pessimist approach, displays a prediction of world oil depletion due to the resource’s non-renewable character. It estimates the peak of

Source:
http://healthandenergy.com/world_oil_and_gas.htm
world oil production around 2005 (see Figure). Furthermore it depicts once again the limited availability of the scarce oil, which, owing to the discovery peak in the 1960’s, implies that oil consumption exceeds new discoveries. Today we only find one barrel oil for every four barrel we consume. Therefore the scarcity of oil, despite new but regarding future development insignificant discoveries, inevitably lead to the depletion of oil.
3. Conclusion Regarding Future Oil Approaches
On the basis of the scarcity of oil, the exhaustion of this vital resource will occur. Therefore it is crucial to invest in green energy and oil substitute production in order to delay oil depletion and attain a little more independence on oil. The technology of tomorrow is unpredictable and therefore leaves the opportunity for finding new ways to overcome this dependency which would consequently result in a less heavy impact of the inevitable oil exhaustion.
“The Future of Oil” Kristin Devantier

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