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[SF Chronicle]: Experts try to predict when the world will start running low on the natural resource that keeps all the engines running.
Three observations in response to ‘Peering into oil’s future’ (SF Chronicle, March 21, 2004, page J1):
First, according to the charts of proven reserves and production rates by country, the US has less than seven years of reserves at present production rates, compared to nearly 11 years at the end of 2001. [BP Statistical Review of World Energy] Mexico has 9.6 years, down from 20.5. (Saudi Arabia has 84 years of production left, up from 81.5.) Can you say ‘energy independence?’ Not if you spell it O-I-L.
Second, the limiting factor for the global energy economy is not the amount of oil in the ground. It’s the ability of the atmosphere to deal with the consequences of burning hundreds of millions of years of fossil fuel in a matter of decades. Finding more oil is actually a problem, not a solution.
Third, as former Saudi oil minister Sheikh Zaki Yamani (one of the architects of the OPEC oil embargo in the early 1970s) noted [Reuters]: ‘The stone age came to an end not for a lack of stones, and the oil age will end, but not for a lack of oil.’
Companies and countries that bet their prosperity on the continuity of the oil economy, instead of efficiency and renewable energy, are taking on significant — and increasingly unnecessary — risk.
Invest accordingly.