# Is the oil era coming to an end? **URL:** \ **Category:** Great Debates\ **Created:** [January 11, 2016, 4:09pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815 "2016-01-11T16:09:03Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [January 12, 2016, 3:17am UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/21 "2016-01-12T03:17:38Z")
> [@CarnalK](#): > > No way. Saudi Arabia isn’t that much in charge of the price. This drop is mostly because of the Chinese economy. Like Greasy Jack said above, SA is taking all the blame because everyone expects them to take the hit and slash production. And like Longhorn said, shale projects are a much more short term deal. Sure this drop in price will make investors a little more nervous, but this oil price is unsustainable. You misread **GJ’s** post. ---
**Author:** ![CarnalK](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/carnalk/32/486_2.png) [@CarnalK](https://boards.straightdope.com/u/CarnalK)\ **Post date:** [January 12, 2016, 4:29am UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/22 "2016-01-12T04:29:01Z")
> [@John\_Mace](#): > > You misread **GJ’s** post. How so? ---
**Author:** ![Quartz](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/quartz/32/267_2.png) [@Quartz](https://boards.straightdope.com/u/Quartz)\ **Post date:** [January 12, 2016, 9:42am UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/23 "2016-01-12T09:42:50Z")
> [@CarnalK](#): > > I simply don’t undersrand this idea that the Saudis are trying to put shale oil producers out of business. If the price goes back up, they’ll start drilling for shale oil again. The shale producers will then be owned by the Saudis. ---
**Author:** ![LonghornDave](https://avatars.discourse-cdn.com/v4/letter/l/a87d85/32.png) [@LonghornDave](https://boards.straightdope.com/u/LonghornDave)\ **Post date:** [January 12, 2016, 4:15pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/24 "2016-01-12T16:15:15Z")
I really don’t understand why this is so hard. The Saudi’s do not want to be the swing producer: the one responsible for decreasing production when the market is oversupplied or increasing production when the market is undersupplied. Further, as the low cost producer, it really doesn’t make a tremendous amount of sense for them to be. They’ve been burned several times in the past trying (mostly unsuccessfully) adjust production to balance the market. If they unilaterally reduced production would it increase prices, almost certainly. Would that price increase be lasting? History tells us probably not. So afterwards they would be in a situation where their production is lower and prices are still low. That type of move would only help their rivals like Iran, Russia, and the high cost western companies operating in places like North America, the deepwater, the North Sea, and the Arctic. If they along with others worked in a coordinated manner to reduce production, would that work? Probably, but their fellow OPEC cartel members have shown time and time again that they will cheat of their quotas (prisoner’s dilemma situation), Russia is unwilling to cooperate, and the U.S. and Canada won’t because we are made up of individual companies and are not state controlled. So what are they doing? They’re letting the market balance itself. And it’s probably working although it’s taking longer then expected. Despite a slowdown in China, 2015 was a strong year for demand growth at somewhere in the range of 1.5 to 1.7 million barrels per day. Growth in 2016 is expected to be pretty good as well at around 1.2 million barrels per day. Capital expenditures globally have reduced dramatically. This includes not only the shale players in the U.S., but more notably the massive projects in the deepwater and tar sands and elsewhere. Delays and reductions on spending on those types of projects are more impactful long-term as they generally come on at huge rates that are sustainable for a longer period. The impact of those types of cuts aren’t as immediate though as they are usually several year long projects before first production. They cuts in drilling of shale is far more immediate. Why hasn’t U.S. production declined yet? Are we just so much more resilient than anyone anticipated? Well, we certainly were able to reduce expenses. Some of those are permanent reductions and some are temporary. How did expenses decrease so much? Well, mostly what happened is that companies stopped trying to prove of acreage and instead started drilling in the core of their land position. Essentially, they stopped doing experiments to test out new land and drilled the stuff they already proved works. This resulted in them being able to drill in a smaller area, where they would drill multiple wells from the same spot (remember these are being drilled horizontally, so they set up one pad and drill multiple wells in different directions from that same spot). They didn’t have to move the rigs as far when they were moving to new spots. They dropped the least effective rigs. They dropped the least effective rig crews. They drilled in areas where the geology is more well known and as a result they experienced less unexpected problems. On top of that, they renegotiated contracts with service companies (who are absolutely hemorrhaging right now) and just generally did a better job of watching what they were spending. On the production decline side, we’ve experienced some of it. U.S. production peaked in April 2015 at 9,694 thousand barrels per day. In October 2015 it was down 347 thousand barrels per day. By year-end, the much less reliably accurate weekly production numbers tell us we were down another 128 thousand barrels per day. Data of course of a mix of actuals and estimates and subject to revisions that always happen. For example, on 12/31/15 the EIA ratcheted up their January 2015 estimate by 102 thousand barrels per day from what they thought it was on 11/30/15. They made similar increases for all months January through September. Basically, the point is that we don’t have incredibly accurate or reliable information even in the U.S. Imagine how poor it is in the rest of the world, with the most important being places like China, Saudi Arabia, Russia, Iran, Nigeria, Venezuela, Libya, etc. But the U.S. is coming down. Now, it’s important to note that we’re not down as much as people thought we might be. Why not? Well, for one thing, prices started to rally back up in April and May. They dropped to a low of $43.46 on 3/17/15 and then quickly rallied to the upper $50s/lower $60s. They peaked for the year at $61.43 on 6/10/15. This gave producers the false confidence that they had seen the worst of it and that prices were quickly going to rebound like they did in the 2008/2009 downturn. The decline in the rig count halted and people were ramping up their drilling and then prices started their decline that has brought us to around $32. Separate from that, we had some big projects that were years in the making come on line. The Gulf of Mexico, in particular had a few big volume deepwater projects come on line during 2015. Some of these were ten years in the making. The Gulf of Mexico is up about 200 thousand barrels per day from the end of 2014. Also, there is just a delay in when you stop drilling and when production starts to decline. A big part of a shale well is the completion (fracking). Even when companies stopped drilling they still had a backlog of wells to complete. Also, things like pipeline infrastructure was holding back some production. Once that was completed production was added. Capital markets were also still relatively open for most companies. There were several big equity and debt issuances in the first half of 2015. For some companies, if they’ve got access to money, they’re going to spend it. That’s all done for the most part now. The U.S. is about to start experiences massive production declines. Probably on the order of 100,000 barrel per day monthly declines. Remember the characteristics of shale wells is that they have very high initial production followed by very steep declines. The market is going to come back into balance in 2016, probably sometime in the Fall. Demand is rising and production is falling. The Saudis approach will eventually work because that’s just the way markets work. There are definitely some unknowns right now and some surprises that will hit us. No one knows how much or how quickly Iran will increase production once sanctions are lifted. We don’t even know what they’re producing right now. Further, we’re pretty sure they’re producing more right now than they say they are and selling it into the black market. We don’t know how much demand growth will be. We know China is slowing, but their oil demand growth has been pretty good. Was that real or not? Maybe they were just filling up their strategic petroleum reserve; we know that was at least some of it. One thing we know is that eventually oil prices will come back up. We know this because they are at a level where almost no one is making money. We know production is coming down and will keep coming down until it is profitable to drill again. We know that much of the world’s production is controlled by state’s that depend on a high price of oil to exist. It’s inevitable that countries like Venezuela will collapse at some point with these prices. ---
**Author:** ![JustinC](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justinc/32/8083_2.png) [@JustinC](https://boards.straightdope.com/u/JustinC)\ **Post date:** [January 15, 2016, 11:01am UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/25 "2016-01-15T11:01:34Z")
Great post, **LonghornDave**. I read Iran aims to raise oil output by 500,000 bpd as soon as sanctions are lifted in early 2016 and by one million bpd in March. Its exports have fallen from 2.6 to 1.4 mbpd in the last three years so will probably go back up to around the 2.5 mbpd mark. ---
**Author:** ![Carryon](https://avatars.discourse-cdn.com/v4/letter/c/9fc29f/32.png) [@Carryon](https://boards.straightdope.com/u/Carryon)\ **Post date:** [January 15, 2016, 6:57pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/26 "2016-01-15T18:57:51Z")
Which countries have large amount of shale? I assume the US and Canada. ---
**Author:** ![Try2B\_Comprehensive](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/try2b_comprehensive/32/65_2.png) [@Try2B\_Comprehensive](https://boards.straightdope.com/u/Try2B_Comprehensive)\ **Post date:** [January 15, 2016, 7:45pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/27 "2016-01-15T19:45:35Z")
There is shale all over the world, but so far the US has the lead in developing it. It isn’t clear if other counties’ shale deposits amount to the kind of resource we find in the US, at least not to me. I recall reading about large shale deposits in China and also Poland, the latter being a potential game changer for Europe because of their reliance on Gazprom. But really it is all over the world, I will try to find a map later if I don’t get beat to it. ---
**Author:** ![Chief\_Pedant](https://avatars.discourse-cdn.com/v4/letter/c/a6a055/32.png) [@Chief\_Pedant](https://boards.straightdope.com/u/Chief_Pedant)\ **Post date:** [January 15, 2016, 8:06pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/28 "2016-01-15T20:06:49Z")
What is happening in the oil market right now is a simple, old-fashion price war. Oil-producing dependent economies–even those with inexpensive production costs–are going to feel a lot of pain because their budgets are often established on assumptions that oil will sell for a significant premium over the cost of production. It will be a fun war to watch… But shouldn’t the thread title be: “Is the Alternative Energy era coming to an end?” AGW worriers notwithstanding, the market nearly always drives our behavior in the long run. Artificial subsidies and high taxes are not good ways to drive energy choices over the long haul. Competitive prices are. If the oil glut keeps down prices for an indefinite period, wouldn’t that diminish an incentive to find alternatives? ---
**Author:** ![Try2B\_Comprehensive](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/try2b_comprehensive/32/65_2.png) [@Try2B\_Comprehensive](https://boards.straightdope.com/u/Try2B_Comprehensive)\ **Post date:** [January 16, 2016, 8:18pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/29 "2016-01-16T20:18:25Z")
> [@Carryon](#): > > Which countries have large amount of shale? I assume the US and Canada. From the [Oil shale reserves wiki](https://en.wikipedia.org/wiki/Oil_shale_reserves): > [@](#): > > As source rocks for most conventional oil reservoirs, oil shale deposits are found in all world oil provinces, although most of them are too deep to be exploited economically.[1] There are around 600 known oil shale deposits around the world.[2] Many deposits need more exploration to determine their potential as reserves. Well-explored deposits, which could ultimately be classified as reserves, include the Green River deposits in the western United States, the Tertiary deposits in Queensland, Australia, deposits in Sweden and Estonia, the El-Lajjun deposit in Jordan, and deposits in France, Germany, Brazil, China, and Russia. It is expected that these deposits would yield at least 40 liters (0.25 bbl) of shale oil per metric ton of shale, using the Fischer Assay.[3][4] > A 2008 estimate set the total world resources of oil shale at 689 gigatons — equivalent to yield of 4.8 trillion barrels (760 billion cubic metres) of shale oil, with the largest resource deposits in the United States, which is thought to have 3.7 trillion barrels (590 billion cubic metres), though only a part of it is recoverable.[5] According to the 2010 World Energy Outlook by the International Energy Agency, the world oil shale resources may be equivalent of more than 5 trillion barrels (790 billion cubic metres) of oil in place of which more than 1 trillion barrels (160 billion cubic metres) may be technically recoverable.[1] For comparison, the world’s proven conventional oil reserves are estimated to be 1.317 trillion barrels (209.4 billion cubic metres), as of 1 January 2007.[6] ---
**Author:** ![GIGObuster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gigobuster/32/421_2.png) [@GIGObuster](https://boards.straightdope.com/u/GIGObuster)\ **Post date:** [January 16, 2016, 8:27pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/30 "2016-01-16T20:27:21Z")
> [@Chief\_Pedant](#): > > What is happening in the oil market right now is a simple, old-fashion price war. > > Oil-producing dependent economies–even those with inexpensive production costs–are going to feel a lot of pain because their budgets are often established on assumptions that oil will sell for a significant premium over the cost of production. > > It will be a fun war to watch… > > But shouldn’t the thread title be: “Is the Alternative Energy era coming to an end?” > > AGW worriers notwithstanding, the market nearly always drives our behavior in the long run. Artificial subsidies and high taxes are not good ways to drive energy choices over the long haul. Competitive prices are. > > If the oil glut keeps down prices for an indefinite period, wouldn’t that diminish an incentive to find alternatives? Well, when developed nations proposed to clean up their water ways with sewage treatment and clean water pipes the option of dumping dirty stuff in our rivers and lakes was still the cheapest option. History shows that even on this you are wrong. The problem of what our emissions causes does not go away, and the need to add to our emissions the real price we are paying will continue to drive the changes that are needed. In the case of the water contamination the issue of disease and other problems was considered when in the end it was decided that even with the increased costs a change was needed. ---
**Author:** ![GreasyJack](https://avatars.discourse-cdn.com/v4/letter/g/df705f/32.png) [@GreasyJack](https://boards.straightdope.com/u/GreasyJack)\ **Post date:** [January 16, 2016, 8:54pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/31 "2016-01-16T20:54:28Z")
> [@Try2B\_Comprehensive](#): > > From the [Oil shale reserves wiki](https://en.wikipedia.org/wiki/Oil_shale_reserves): Although to nitpick here, what’s been going on with the domestic production booms is _not_ oil shale. Oil shale is usually understood to mean actually drilling the shale source rock, which requires some sort of process similar to what’s used in the oil sands to heat the formation to actually get oil out of it. With things like the Bakken in North Dakota or the Eagle Ford in Texas, they would be called “unconventional reservoirs” but they’re still conventional oil in the sense that the oil is in a sandstone or carbonate reservoir rock instead of the original shale source rock. It’s just that the reservoirs are really, really thin and not particularly permeable, which means drilling normal vertical wells into them gives you almost no formation exposure. But if you drill horizontally, you get miles of formation exposure and fracking increases the permeability. It turns out that for various geological reasons, the situation where you have a tiny layer of suitable reservoir rock sandwiched between shale source rock is a lot more common than the “easy oil” situation where you have a really thick porous reservoir rock next to a source rock. So there are quite a lot of places around the world where the same techniques could be applied, it’s just that they’re more expensive and so thus far they’ve mostly used them in the contiguous US and southern Canada where other operating expenses are much lower. (And, yeah, if the economics/technology ever works out for actual oil shale development, there’s _huge_ amounts of oil there all over the world.) ---
**Author:** ![Martin\_Hyde](https://avatars.discourse-cdn.com/v4/letter/m/47e85d/32.png) [@Martin\_Hyde](https://boards.straightdope.com/u/Martin_Hyde)\ **Post date:** [January 16, 2016, 10:14pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/32 "2016-01-16T22:14:36Z")
> [@LonghornDave](#): > > One thing we know is that eventually oil prices will come back up. We know this because they are at a level where almost no one is making money. We know production is coming down and will keep coming down until it is profitable to drill again. We know that much of the world’s production is controlled by state’s that depend on a high price of oil to exist. It’s inevitable that countries like Venezuela will collapse at some point with these prices. I think Venezuela’s collapse is indeed inevitable. Even when prices go back up, I don’t think they’ll go up enough to save Venezuela. Venezuela has basically the worst possible situation: an economically incompetent and corrupt government, an incompetently ran state oil company (the people who knew how to run it were affiliated with the wrong political party and forced out of their jobs), and a relatively high cost of production. If you look at the situation in Venezuelan supermarkets and the situation with their currency they’ve arguably already started the collapse. ---
**Author:** ![Try2B\_Comprehensive](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/try2b_comprehensive/32/65_2.png) [@Try2B\_Comprehensive](https://boards.straightdope.com/u/Try2B_Comprehensive)\ **Post date:** [January 16, 2016, 10:15pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/33 "2016-01-16T22:15:11Z")
I see. People always talk about ‘fracking shale’, but there are more distinctions in that than I was aware of. So. Where do formations like the Bakken and Eagle Ford fit into the world oil reserves picture? Is it a third category of unconventional oil, oil shale and conventional, or do they fall under ‘conventional reserves’? Here is a [cite](http://www.theguardian.com/environment/2015/jan/12/polands-shale-gas-revolution-evaporates-in-face-of-environmental-protests) for my claim about Polish shale gas: > [@](#): > > A soon-to-be-updated study by the Polish Geological Institute in March 2012 estimated that recoverable shale gas volumes under the country at between 346bn and 768bn cubic metres - the third biggest in Europe and enough to supply the country’s gas needs for between 35 and 65 years. The article is all about how protests and poor results are squashing the Polish shale gas industry, so don’t expect this to be developed anytime soon. ---
**Author:** ![Martin\_Hyde](https://avatars.discourse-cdn.com/v4/letter/m/47e85d/32.png) [@Martin\_Hyde](https://boards.straightdope.com/u/Martin_Hyde)\ **Post date:** [January 16, 2016, 10:28pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/34 "2016-01-16T22:28:08Z")
There’s probably shale reserves of oil and gas in lots of countries that will never do it, I think Britain still doesn’t allow fracking for example and has large reserves. But much of the large American shale formations all the regulatory framework is already in place to allow the drilling. There won’t be a lot of legal hoops to jump through to ramp production back up. Some States have banned fracking–like New York, but there’s still plenty of reserves elsewhere in States that are quite friendly to it. A lot of leases have already been bought up and all the land use rights settled, new wells could be done on some of that land in literally weeks. The only thing stopping it is the low price. ---
**Author:** ![GreasyJack](https://avatars.discourse-cdn.com/v4/letter/g/df705f/32.png) [@GreasyJack](https://boards.straightdope.com/u/GreasyJack)\ **Post date:** [January 16, 2016, 10:44pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/35 "2016-01-16T22:44:08Z")
> [@Try2B\_Comprehensive](#): > > I see. People always talk about ‘fracking shale’, but there are more distinctions in that than I was aware of. > > So. Where do formations like the Bakken and Eagle Ford fit into the world oil reserves picture? Is it a third category of unconventional oil, oil shale and conventional, or do they fall under ‘conventional reserves’? With gas wells, drilling and fracking directly into the shale works a lot better because shale can hold gasses better than liquids; they just have poor vertical permeability until you frack them. With oil-producing shales, the oil gets expelled very quickly after it’s produced, so drilling and fracking the shale itself is usually less useful. It’s also somewhat confusing because the geologic convention is to call a whole formation the “Such-and-such Shale” if it’s _mostly_ shale. So like, in the Bakken Formation, they call the whole thing “the Bakken Shale” but it’s really an upper shale member, a middle sandstone/limestone member and a lower shale member. The middle member is the reservoir and where they drill. If it were shale all the way through it likely wouldn’t be economically recoverable. The term for things like the Bakken and Eagle Ford that usually gets used is [tight oil](https://en.wikipedia.org/wiki/Tight_oil) or, confusingly, shale oil. That Wiki page has estimates of recoverable reserves, but this is a situation where they really don’t know how much is “recoverable” until they actually give it the old college try. Like the recoverable reserves in the Bakken skyrocketed over the last decade, not because there was any major change in understanding of the geology, but because as they actually started drilling and fracking horizontal wells there they turned out to be way more productive than at first thought. ---
**Author:** ![Quartz](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/quartz/32/267_2.png) [@Quartz](https://boards.straightdope.com/u/Quartz)\ **Post date:** [January 16, 2016, 11:19pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/36 "2016-01-16T23:19:45Z")
According to my brother, who’s in the industry, the problem with fracking is not the extraction of the gas but preventing contamination of the groundwater. When industry cracks (ahem) that problem then there won’t be a problem. ---
**Author:** ![GreasyJack](https://avatars.discourse-cdn.com/v4/letter/g/df705f/32.png) [@GreasyJack](https://boards.straightdope.com/u/GreasyJack)\ **Post date:** [January 17, 2016, 12:12am UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/37 "2016-01-17T00:12:57Z")
> [@Quartz](#): > > According to my brother, who’s in the industry, the problem with fracking is not the extraction of the gas but preventing contamination of the groundwater. When industry cracks (ahem) that problem then there won’t be a problem. That is certainly a claim that is made by groups opposed to oil and gas development, but one that’s not really borne out by the evidence. But that’s a whole different GD thread right there. ---
**Author:** ![Chief\_Pedant](https://avatars.discourse-cdn.com/v4/letter/c/a6a055/32.png) [@Chief\_Pedant](https://boards.straightdope.com/u/Chief_Pedant)\ **Post date:** [January 17, 2016, 1:30pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/38 "2016-01-17T13:30:07Z")
> [@GIGObuster](#): > > Well, when developed nations proposed to clean up their water ways with sewage treatment and clean water pipes the option of dumping dirty stuff in our rivers and lakes was still the cheapest option. > > History shows that even on this you are wrong. The problem of what our emissions causes does not go away, and the need to add to our emissions the real price we are paying will continue to drive the changes that are needed. In the case of the water contamination the issue of disease and other problems was considered when in the end it was decided that even with the increased costs a change was needed. So…just to be clear: You feel that dirt-cheap oil is not a threat to alternative energies? I do understand that in your opinion fossil fuels are exactly parallel to sewage, but Im not sure the broad public has quite bought into that yet. In particular, I’m wondering if it’s your position that extremely inexpensive oil has no relevance on the degree to which it will retain market penetration as an energy source. Here’s some data on [SUV and Pickup sales,](http://www.nytimes.com/2016/01/06/business/pickups-and-suvs-lead-way-to-a-record-year-for-automakers.html?_r=0) if that helps. But in short, you don’t see any correlation between inexpensive gas and a greater persistence of oil-thirsty vehicles, for example? ---
**Author:** ![botsgotme](https://avatars.discourse-cdn.com/v4/letter/b/91b2a8/32.png) [@botsgotme](https://boards.straightdope.com/u/botsgotme)\ **Post date:** [January 17, 2016, 3:21pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/39 "2016-01-17T15:21:42Z")
Whe we are able to tap the methane (solid) in the deep oceans, we will have an unlimited supply of clean energy. This si coming, faster than you think. ---
**Author:** ![GIGObuster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gigobuster/32/421_2.png) [@GIGObuster](https://boards.straightdope.com/u/GIGObuster)\ **Post date:** [January 17, 2016, 4:23pm UTC](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815/40 "2016-01-17T16:23:25Z")
> [@Chief\_Pedant](#): > > So…just to be clear: You feel that dirt-cheap oil is not a threat to alternative energies? I actually did search before claiming that, the fact that you can not find evidence like the following one demonstrates once again that you are still relying on sources that are misleading you. [http://www.bloomberg.com/news/articles/2015-01-30/seven-reasons-cheap-oil-can-t-stop-renewables-now](http://www.bloomberg.com/news/articles/2015-01-30/seven-reasons-cheap-oil-can-t-stop-renewables-now) > [@](#): > > Seven Reasons Cheap Oil Can’t Stop Renewables Now > > 1. The Sun Doesn’t Compete With Oil Oil is for cars; renewables are for electricity. > > The two don’t really compete. Oil is just too expensive to power the grid, even with prices well below $50 a barrel. > > Instead, solar competes with coal, natural gas, hydro, and nuclear power. Solar, the newest to the mix, makes up less than 1 percent of the electricity market today but will be the world’s biggest single source by 2050, according to the International Energy Agency. Demand is so strong that the biggest limit to installations this year may be the availability of panels. > > “You couldn’t kill solar now if you wanted to,” says Jenny Chase, the lead solar analyst with Bloomberg New Energy Finance in London. > [@](#): > > 1. Solar Prices Are Still Going Down > > You may have seen this chart before. It’s the most important chart. It shows the reason solar will soon dominate: It’s a technology, not a fuel. As time passes, the efficiency of solar power increases and prices fall. > [@Chief\_Pedant](#): > > I do understand that in your opinion fossil fuels are exactly parallel to sewage, but Im not sure the broad public has quite bought into that yet. In particular, I’m wondering if it’s your position that extremely inexpensive oil has no relevance on the degree to which it will retain market penetration as an energy source. > > Here’s some data on [SUV and Pickup sales,](http://www.nytimes.com/2016/01/06/business/pickups-and-suvs-lead-way-to-a-record-year-for-automakers.html?_r=0) if that helps. It only once again points to your pointer setter like moves of pointing at the issue but not the solution. > [@](#): > > 1. Sales of Plug-Ins Are Doing Just Fine, Actually > > Conventional wisdom says cheap oil is an existential threat to electric vehicles. It’s been true in the past, notably when Congress retreated from funding EV research in the 1980s as oil prices tanked. Things are different now, and global sales of plug-ins rose by about a third last year, according to BNEF. > > Here’s why cheap oil won’t stop electric vehicles: > > [ul] > [li]Since 2010 there’s been no relationship between gasoline price and electric vehicle sales, according to BNEF analyst Alejandro Zamorano Cadavid. Electric cars are still in the early-adopter phase, and someone paying $100,000 for a Tesla doesn’t care that gasoline costs a buck less per gallon.[/li][li] In Europe, gas taxes are so high that it makes the price of crude less important. If you’re in Norway, and gas drops from $10 a gallon to $9 a gallon, electric cars are still a deal.[/li][li] In China, the government is stepping up support for electric vehicles. Pollution has become a serious problem, and the Chinese are getting serious about fixing it. Plug-in sales are soaring.[/li][/ul] > > Electric vehicles are moving like a Tesla: quietly, but with great acceleration. Let’s bookmark this conversation for two years from now, when Chevy and Tesla plan to release the first affordable mass-market plug-ins with a range of 200+ miles per charge. At that point, the price of fuel might be a real consideration for car buyers, and at that point it’s more likely to tip the scales toward EVs, not away from them. > [@Chief\_Pedant](#): > > But in short, you don’t see any correlation between inexpensive gas and a greater persistence of oil-thirsty vehicles, for example? Of course there is, but it is in short a red herring regarding what it needs to be done. We are seeing that result regarding gas guzzling cars now because there are politicians that are preventing adding the actual price that we are and will pay for treating the atmosphere like a sewer. As usual you do miss another reason why scientists like Richard Alley used the example of the great change made to our past predilection of developed nations of using their waterways as sewage lanes. That many well to do or politicians of the day also opposed change regarding the cleaning of water sources and waterways. Nowadays in England and other places those nattering nabobs are forgotten to history and it is the ones that planned and executed the change the ones that are remembered. [http://www.theengineer.co.uk/sewage-solution/](http://www.theengineer.co.uk/sewage-solution/) > [@](#): > > Joseph Bazalgette’s London sewers may be the greatest engineering feat of the Victorian age. Comprising almost 900km of tunnels lined with 318 million bricks, the system took just six years to build, during which time seven million cubic metres of earth was scraped out of the city’s underbelly and the River Thames was contained within permanent embankments, creating the landscape of modern London. The sewers diverted the city’s sewage, via huge, elaborate pumping stations in north-east and south-east London, to treatment works and out into the estuary, well downstream of most of the population. In building this system, Bazalgette immeasurably improved public health and the atmosphere of London, banishing the ‘great stinks’ from raw sewage flushed into the river and averting the risk of cholera epidemics, which had plagued the city for centuries. [Previous page](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815.md?page=1) [Next page](https://boards.straightdope.com/t/is-the-oil-era-coming-to-an-end/742815.md?page=3)