Let us hypothesize that an extremely plentiful source of high quality crude is located on north american soil, or a perfectly workable substitute for organic oil is discovered or developed at insignificant cost to produce, or that an alternative energy source is developed that renders the world market for oil all but non-existent in its current form.
Whatever the underlying cause, the basic assumptions are that almost instantaneously, oil is no longer the dominant commodity in the world economy, that cartels like OPEC accordingly no longer exert the same control over the global economic situation, and that the US, and in fact any nation in the world, is no longer dependent on the arab nations or other traditional sources for oil production.
What are the likely results, socially, economically, and as regards international relations?
Well, biodiesel tech’s been around for a hundred years, it’s that not expensive to produce, & we could invest in the infrastucture to make it readily available. Current petroleum availability is due to investment in rock oil over a long time, but that investment could be diverted to renewable resources; but in no way would it be “almost instantaneously.”
I think that the only way that oil would cease to be the “dominant commodity on the world economy” is if it wasn’t the major source of energy, regardless of the price. Back in the 1930’s, so much oil flooded the US from the new East Texas discoveries that the price of a barrel of oil dropped to a nominal $.02/barrel… but that didn’t make the importance of oil any less.
My apologies for debating the premise, rather than the question asked.
Well, as their economic base crumbles, the Saudis desperately start selling off the trillion or so they’ve bought over the years in U.S. real estate and equities. The resulting fire sale will make a few well-connected familes fabulously rich (or richer) and spell serious economic trouble for most everyone else.
Well, first of all, is there something you know that we don’t? Got a stock symbol for the outfit that’s gonna toss Big Oil in history’s dumpster?
Actually, though, the first two instances listed above do not, in fact, render the world market for oil non-existent. I also disagree with the OP’s later assertion that “cartels like OPEC” control the global economic situation in anything but the shortest of terms. OPEC is mostly made up of countries that rely on oil and gas exports for large portions of their GDP. Except for the disastrous attempt at choking production in the '70s, OPEC’s member states have mostly been concerned with maneuvering against each other to increase their share of the market, than with artificially propping up prices.
Setting aside the deeply flawed premise, I guess some of the general impacts would include:
Many hundreds of thousands of persons employed in the industry worldwide (I’m one of them, btw) would be thrown out of work;
Those countries that have relied mainly on oil revenues to prop up their economies, and who have not attempted to diversify (like, say, the Persian Gulf emirates), would likely wither;
The US might, but only might, be less inclined to help prop up sympathetic regimes in non-democratic states that happen to possess large energy resources;
This magically cheap source of energy would presumably be available to all, so we would likely see an explosion in the economic growth of states that are not hopelessly mired in corruption (so I might be able to find post-oil work after all, but much of sub-saharan Africa would likely continue to struggle for some time);
The same conditions of plenty could mean the US would have even more competition from countries providing cheaper goods and services than exists already (so maybe I wouldn’t have a new job after all);
Really, really cheap energy might fuel such overheated growth that the space needed for an exploding population, associated industry and transportation would overwhelm the remaining arable land (although I guess this is really a longer-term thing).
I don’t know whether the OP is really looking for an objective assessment of such impacts, or just looking for excuses to cut loose from Middle-eastern energy supplies, but a truly near-instantaneous change in energy sources would not necessarily be all good, even in the short run.
Oh, and in case it’s not clear, I’m citing some of the Persian Gulf states as examples of countries where an effort IS being made to diversify their economies.
