The best quip I've heard about this is that the neo-cons have finally come around to where Jimmy Carter was thirty years ago.

One of the big lessons I got from reading 'The Prize' is how volatile the oil market's always been. Since then, I've thought that introducing a predictable price floor on the commodity is as big an argument for a petroleum tax as reduced consumption. It's gotta be hard convincing your local venture capitalist to invest in your energy technology, when the VC can reasonably expect oil prices to halve (even briefly) sometime in the next few years.

If our aggressive Middle East policy is designed to keep oil prices low, then high oil prices would have another significant effect: we could get out of the Middle East.

Wouldn't that be awfully nice?

The Winter 2005 issue of the Wilson Quarterly contains an essay by Andrew Bachevich that is worth reading in the context of analysing the oil dependence of the U.S. and some of its foreign policy implications.

It has always troubled me that the U.S. has acquiesced in the macinations of an anti-competitive cartel (OPEC). But OPEC has astutely (since 1979) managed the price of oil to avoid rises high enough to encourage substitution, or to bring about a recession, and in either case decrease demand.

The current price of oil/gas in the U.S. has been estimated to be only half of the actual economic cost of consumption once the externalities of pollution and defense costs are factored in (admittedly a very fuzzy calculation). So higher prices should lead to more efficient allocation of resources (as with all commodities). The fact that the U.S. government subsidizes these costs (through tax breaks and regulatory laxity primarily) means that our economy consumes more oil than it otherwise would. This has stymied technological innovation (see Japan and Europe for smart diesel and hybrid technology) in the U.S.

There was an extensive debate over gas taxes during the run-up to the election in 2004 that elucidated a number of proposals and angles on the U.S. oil dependence. If anyone is interested I have an archive of many of the articles.

My final point is that Woolsey et al have got it wrong if they think that reducing demand for oil will reduce the price or the revenues of the Middle Eastern oligarchs. btw, Krauthammer initially proposed this last year as a reason to impose a gas tax. The Saudis, Iraqis and Iranians produce some 2/3rds of the world's oil and will always be the incremental producer and thus set the price. If demand drops and prices fall they will shut in production and increase the price. It is this ability to manage the market that makes the investments of billions of dollars in oil sand or other higher cost hydrocarbons so risky.

Now if you could organize a boycott of Arab/Persian Gulf oil.... but then think of how your neighbors wife would respond to a $60 bill to fill her tank!

Regards, John

Something is missing here. Yes, we don't know when oil reserves will peak (especially with Iraq tied up in knots). And, yes, oil may be cheap to extract where infrastructure is in place.

But, my understanding was that oil is expensive right now because we have reached the limits of production -- not reserves -- but production. For more production, you would need further investment.

That being said, oil reserves/production are the world's best kept secret.

sglover hits a key point.

December 2011 oil futures were recently priced at $38.98, which indicates that the markets currently believe that the long term price of oil is going to stay above $35.00 per bbl. These futures market prices though, may not be sufficient to convince investors in oil alternatives that their investments are not going to have the legs cut out from under them by OPEC at some point during the term of their investment.

If there was some certainty that oil prices would stay above $35.00 per barrel, there are a number of oil alternatives that could compete effectively against imported oil.

The federal government could provide that certainty by establishing a price floor of $35.00 per bbl of oil through taxes or some other mechanism.

The means of eliminating our need for imported oil are available, what is lacking is the will.

In addition to the benefit of being able to leave the MidEast alone if we stop importing oil is the ability to avoid a war with China over access to oil. The savings from those two benefits alone should easily outweigh the costs of oil at a minimum price of $35 per bbl.

Steve, in my view the arguments you presented to Kuhn are precisely correct. Let's think back to the first oil embargo and President Carter's crash programs for synfuels and other alternative energy research. Once the OPEC cartel understood how to keep us addicted with affordable--but still profitable--pricing, the lines at the pump disappeared. Prices dropped and memories failed. Funding for alternative energy, and the incentives to overcome inertia and switch, dried up. Fuel economy, which was rising, retreated and Detroit wangled special exemptions and tax breaks for high-profit, gas-guzzling SUVs.

Our collective disinclination to change, to tax ourselves, to delay gratification, has put us in a far worse position than the Europeans and Japanese.

Right now there are ways to drastically decrease our burning of oil merely for transportation or consumer uses. It will mean wrenching changes in our economy and infrastructure, but the sooner we open our eyes and start changing, the better. There are other uses for petroleum for which there are no ready substitutes, most importantly in pharmaceuticals.

But above all, the matter of climate change is coming to a crisis point. As reported this week in The Independent/UK: "Global warming has already hit the danger point that international attempts to curb it are designed to avoid, according to the world's top climate watchdog. Dr Rajendra Pachauri, the chairman of the official Intergovernmental Panel on Climate Change (IPCC), told an international conference attended by 114 governments in Mauritius this month that he personally believes that the world has 'already reached the level of dangerous concentrations of carbon dioxide in the atmosphere' and called for immediate and 'very deep' cuts in the pollution if humanity is to 'survive'."

How can we contemplate China, India and the rest of the developing world basing its future growth on fossil fuel consumption comparable to our own reckless burning? We are inviting the doom of our species unless we make immediate and unprecedented efforts to change how we live on this planet.

Tragically, under the current administration and the current American mindset, this is a vain hope.

Steve said, "...that by keeping the price of oil low, every user's dependency on oil is maintained with little real incentive to move to alternatives. Raising the price of oil would increase the investment and interest in renewables and alternative fuel and energy sources if access to oil were squeezed."

I say, "Something feels really really right about that. The BOINC project at Berkeley has come up with some rather scary scenarios for future earth climates. Complacency in the oil and energy industries for reasons of profit could literally kill us all."

Since the current global economic system, and consequently much of the world's politics, is based on the fact that a vital nature resource has a limited geographical distribution, what would happen is a switch were made to alternative energy sources, which would have a wider geographic distribution? Wouldn't that in effect make the world's nations less dependent on international trade? It seems to me any switch from oil to alternative fuels would basically change the global economic system. So what would that world look like?

I am all for adding 50 cents to each gallon of gasoline. At the end of the year, the IRS can allow low income people to take a deduction. It is also a disgrace when people purchase a vehicle like the Hummer while we are at war. The government should not outlaw such a purchase, but there is no reason we can’t treat these drivers with a certain degree of disdain.

Global oil use is somewhat flexible. The big stick the buyers have over the sellers is they will conserve or switch to other fuels if oil prices are too high. This provides a damper both on oil use and oil prices.

The most inflexible system in America is transportation. We have an almost total reliance on oil. The light rail is the current electric transportation alternative to oil. Conservation options take longer. The CAFE standards of the late 1970s did not fully make an impact on fuel consumption until the early 80s. After the last OPEC oil embargo, US oil consumption steadily dropped by about 25%. This put OPEC in a bind and led to oil pumping limits to keep the price up. The Reagan economy benefitted greatly from a drop in oil prices that eased inflation and interst rates and led to a building boom.

Oil consumption drop also led to an overcapacity in oil refining. Oil consumption in the US did not reach 1980s peak levels again until the year 2000. This is the reason why no new refining capacity was added during that time (not environmental laws, Mr Cheney). We bump up against refining capacity and that is the main reason for our current oil price spikes, Oil consumption is now a closer match to the levels that OPEC and other countries wish to sell, so they can demand more for their oil. They don't have us over a barrel and probably won't.

Eventually, the oil economy will be replaced by alternatives. Currently, the Dutch lead the world in wind generated power as they have historically. The French are ahead on nuke power, currently. The danger for the US in propping up the oil economy at the expense of moving to alternatives is in giving up or ceding the technology lead on the new energy wave. The jobs in building the new alternative energy infrastructure will locate where the technology is developed. If that location is not the US, then those jobs will not locate here.

“The French are ahead on nuke power, currently.”

And who’s fault is that? The radical Left in this country has made it virtually impossible to build new nuclear plants. Are you willing to take them to task?

I was once deeply involved in the logistics of jet fuel, which, with diesel and heating oil, is just one fraction of the yield from crude - with others being gasoline and the feedstocks for petrochemicals, and on down to heavy fuels and asphalt. Too many of us see "oil" as just gasoline for cars. Converting the industrial economy away from oil will be an epochal technical shift, beyond comprehension for an old fuel wrangler like me. In the jet fuel arena, it would take decades to phase in aircraft powered by hydrogen (about the only technically feasible alternative, and the safety implications may be prohibitive). John DeLong is right about the big fuedal producers holding the pricing cards at the margin, and I noticed John didn't offer a solution... His is the dilemma the energy companies and energy-policy folks have faced since 1973, when the OPEC primitive cartel seized the Saudi oil fields from the Seven Sisters western cartel (largely in reaction to the aggression and arrogance of Europe). The Europeans have squeezed down automotive fuel demand by raising prices and displaced some fuel with fission, but they have no solution to mitigating the other uses of oil. The auto segment is easiest because the machinery has relatively quick turnover and can respond to a squeeze. Where does British Airways go if jet fuel prices are maintained artificially at $40 per bbl? They can't just write off machines that have already been optimized for distilled oil at great cost. "Modern" as airplanes are, the update cycle is painfully incremental, just inching ahead at huge capital cost, very risk-averse for good reasons. Much as we may dislike accommodating the primitives, it has proven to be the only rational way to smooth the erratic supply. Our adventure in Iraq, on one level at least, is an experiment in getting "tough" instead of continuing to accommodate - and it is proving to be a spectacular failure. If we want to solve our supply problem by force of arms, we have to go the Middle East like the Romans did, and stay for 300 years like they did. This too is unthinkable. It appears to me that the best way forward is to enlist the fuedal rulers in liberalizing their regimes and marginalizing their zealots for the mutual good. Now that we know our "stick" isn't effective, what is the "carrot"? Probably something a little different for each primitive regime, but we have to stay engaged and moderate this loopy aggressive stance. The rise of China, and its turn toward modernity, looks good to me, not threatening. If we (the West, not just the U.S.) could spark some modernity in Islamic quarters, oil could be just another trade issue, not the powderkeg it is today. "Giving up oil" is just as irrational as "Conquering oil". The outburst of Islamist violence has so far evoked only ineffective rage - our well-being demands a more rational response, like steady pressure and steady outreach, offering our advanced educational "goods" as we have to the Chinese, and showing the primitives that there is an alternative to anarchy and despotism.

Jim Rogers has an interesting take on the oil situation in his book Hot Commodities. In his view, prices are heading north mostly for the next decade or so, simply because at this point in time, demand is exceeding supply. Supply won't come on line all that quickly because it can't. He also believes that there well may be creedence to the peak production scenarios.

I have thought for some time that a good solution for taxing petroleum products would be to raise the tax incrementally, for example, two cents per month with no termination. Eventually, the price of it will remain high enough to make a difference. This way, the price goes up, and everyone knows it is going up. At the same time, you have time to finish up one last gas guzzler lease. The auto companies know that demand will be there for more fuel efficient cars.

Dave in response to:

"The French are ahead on nuke power, currently."
"And who’s fault is that?" [liberals are evil, diatribe here]?
- by David Thomson

The French system is government run and if you suggesting we do likewise with say the US Navy, then I, as an evil lefty, am with you all the way. By the way there is a new fission control system developed by the Japanese that resolves a big cost/risk of Nuclear plants.

Still you have nuclear waste problem and I don't know if you understand the true cost of handling it properly as the French have. And therein lies the real problem Dave, gas fired plants are better investments until Natural Gas prices rise further.

RickG This tax idea has come up before in the 0.10$ a year, I think it is a good idea.

Don, didn't the Saudi's offer the US/world long term contracts (25.00$/barrel for 20 years) when the price per barrel was 12.00 - 18.00$ and didn't we say no thanks dude?

David Thomson: "The radical Left in this country has made it virtually impossible to build new nuclear plants."

I would differ with that assessment. I live on Long Island, home to the never-opened Shoreham nuclear plant. It was abandoned, at huge expense, because residents all across Long Island realized that any disaster at the plant made them sitting ducks in a cul-de-sac and they supported the abandonment. Construction costs to try to guarantee safety had risen so far anyway that it was never going to be cheap energy.

Nassau and Suffolk Counties on L.I. are hardly hotbeds of left-wing radicals. Neither is Westchester County, north of N.Y.C., where they would dearly love to get rid of trouble-plagued Indian Point. Add in the Three-Mile-Island disaster and numerous small accidents and alerts at plants across the country, and people get jumpy.

An honest evaluation of nuclear power history would acknowledge that too many instances of carelessness, corruption, negligence and just plain bad design on the part of the industry and the utilities resulted in a general distrust of the technology by the public. That, coupled with the problems of nuclear waste disposal, sealed the fate of 20th century nuclear power in the U.S.

In an earlier post, you said you would support a 50-cent/gallon gas tax. Given the volatility of gas prices these days, I don't think that's enough to change many habits. A courageous administration and Congress would advocate a phased increase of at least $4 per gallon, with the proceeds dedicated to research and infrastructure development in alternative technologies. I understand that this will mean grave hardships and a drop in our standard of living for the short term. But it's going to happen one way or another, so we might as well capture the benefit by taxing now. Hummers, until they can run on hydrogen cells, will go the way of the dodo. If someone insists on buying one, he should be paying a 100% environmental degradation tax.

Steve, you think Huber and Mills I didn't think, like you, that the problem is cheap oil. I'm on your side, but I don't think that's where Huber and Mills are. Based on the passage you cite, they think the problem is quite the opposite, since the passage begins with the statement:

"The price of oil remains high only because the cost of oil remains so low. We remain dependent on oil from the Mideast not because the planet is running out of buried hydrocarbons, but because extracting oil from the deserts of the Persian Gulf is so easy and cheap that it's risky to invest capital to extract somewhat more stubborn oil from far larger deposits in Alberta."

My interpretation of the rest is that they think we could achieve a long-term decrease in oil prices by spending more money up front on exploration and development in places like Alberta. Extraction would be more expensive in Alberta than in the Middle East, but the oil would only have to be tranported from Alberta, and more importantly its price wouldn't be rigged by OPEC. I gather that they think the lower, non-cartel-driven free market price of Albertan oil would offset the higher extraction cost, and get us cheaper oil, so long as we are willing to take some intitial risks.

I haven't read their book yet, but isn't it their argument that the fears of an impending (or is it incipient?) oil crisis are overblown, and that there is plenty of oil in the ground for a very long time?

Sorry for the garbled first sentence in my previous post. It should read:

"Steve, you say Huber and Mills think, like you, that the problem is cheap oil."

"Europe and Japan operate their economies with a price of consumed gas at the pump that is three to four times the cost here in the U.S. When I was last in London, a gallon of gas was $8.00. Most of the cost of gas in Japan and Europe is an enormous tax -- but still, these economies have self-imposed a harsher energy consumption cost on themselves and are still growing pretty soundly."

And they also have world class public transit systems that reach far outside major cities.

Whether peak oil comes in the 2030s (as the DOE suggests it will), or later this year (as some independent geologists suggest it will), this is not simply a national or even western crisis, but a civilizational crisis in the making. And as of right now there are no good, easy solutions.

We depend on oil (and particularly cheap oil) to run not simply our cars and the grid, but also for everything from plastics (on which pretty much every industry depends) to pesticides (on which our food supply depends.) Hydrogen is really no answer at all, because its simply an efficient way to store electricity, rather than an actual source of electricity.

Solar and wind are still gravely inefficient and expensive, and biofuels have promise but people need to keep in mind that a biofuel economy would require a staggering percentage of the world's land masses become fertile farm land.

And of course the loonies are talking about nuclear again, hoping I guess no one will ask them this time around how they plan to guard the waste for the next 500,000 years, or perhaps that we'll get so desperate we won't care.

In any event, even if we do manage to build a comfortable bridge to a post-oil civilization (and I'm skeptical it will be comfortable for many) we're still heading for the cliff. The world can accomodate American levels of consumption in America (at least for now), but do you think the Chinese and Indians will like to be told that they can't have what we have? Do you know what a burgeois, middle class, western-style life for another two billion people means for the planet?

Green Dem,

The French have managed to eliminate the most dangerous component of nuclear fission, namely, the American Business Excecutive. Without this highly volitile and reactive agent, an actor that is so sensitive that it must be surounded by alternating layers of money and sycophants, the French have been able to produce electricity for far less money and with a higher degree of safety.

Before we give up the process perhaps we should look how the French were able to do it and emulate them. The US Navy is ready, able...and standing by.

Oh yeah, the most logical place for high level nuclear waste (dryest, no water table, furthest away from population centers and excedingly difficult to reach), is the only place that it is prohibited. Do you know where that is?

We in Alberta welcome your investment. Only now you have to compete with Chinese interests. So get out those cheque books! ;-)

A National Geographic article compared the greatly optimistic "peak" of oil production at being around 2040, and the pessimistic around 2015. Some even say we'll be hitting the peak in as little as a couple of years.

“An honest evaluation of nuclear power history would acknowledge that too many instances of carelessness, corruption, negligence and just plain bad design on the part of the industry and the utilities resulted in a general distrust of the technology by the public. That, coupled with the problems of nuclear waste disposal, sealed the fate of 20th century nuclear power in the U.S.”

Really? What explains the success in France? Are they somehow superior to us?

“Nassau and Suffolk Counties on L.I. are hardly hotbeds of left-wing radicals.”

The left-wing radicals, however, dominated the media and intellectual institutions---and this resulted in people being conned by their pseudoscientific rhetoric.

The French success in nuke power has come from settling on a single design and using a government management scheme. Many nuke plants in the US were "one of a kind" designs that lack the benefits of the learning curve. Many of the nuke plants proposed in the US were not cost effective. They would have greatly raised electric rates and cost more than other methods avialble. Sure there was a lot of left wing protest to nuke plants, but the deciding factor is economics.

I have pointed out numerous times in other forums that raising prices is not an effective strategy for better fuel conservation. The following chart demonstrates why. If we look at a 100,000 mile average lifespan of a car, then even what seem like large increases in gasoline price are only a minor component of the cost. Even doubling the current US price of $2 per gallon to $ per gallon would increase the fuel costs of a 20 mpg car from $10,000 to $20,000 over the 100,000 mile lifespan. This means that any fuel efficiency technology that would double the gas mileage would have to cost less than $10,000 to justify economically. To double the fuel economy from 40 mpg to 80 mpg if gas were $4 per gal, would save only $5,000.

10 mpg 20 mpg 40 mpg 80 mpg
$1 10000 5000 2500 1250
$2 20000 10000 5000 2500
$3 30000 15000 7500 3750
$4 40000 20000 10000 5000
$5 50000 25000 12500 6250
$10 100000 50000 25000 12500

Only when gasoline prices reach $10 per gallon do we see real incentives to move to high mileage vehicles. If gas prices are responsive to consumption, then as more people switch to high mileage vehicles, the price of gasoline will drop to the benefit of the gas hogs. This is a perverse disincentive for conservation. The best way to improve fuel efficiency is a new round of CAFE standards as were implemented in the late 1970s. They are proven to work.

I think lots and lots of Americans are very interested in alternative fuel sources including NUKE power. Just as long as that nuKe plant isn't built anywhere near our communities...and I don't think it's completely a Left/Right issue. I think it's a NIMBY thing. Maybe if we could get the debate about NUkes elevated beyond Right/left we'd get more done.

David Thomson answers re the U.S. nuclear industry: "The left-wing radicals, however, dominated the media and intellectual institutions---and this resulted in people being conned by their pseudoscientific rhetoric."

This is disengenuous on so many levels that it's hard to take at all seriously. I can assure you that the average resident of L.I. cares first about one thing: Cost. The experience of escalating costs for Shoreham along with the dawning realization that it wouldn't produce energy cheaply was the deal-killer, especially when added to the risks that were obvious to all. It didn't take "pseudoscientific rhetoric" to convince most people that if an accident at the plant produced a large radiation leak, they'd be stuck in the neighborhood. The plant is located at the end of a country road on Long Island Sound, and the surrounding communities are served by a maze of small lanes. The Long Island Expressway, meanwhile, is a vast parking lot at the best of times. To paraphrase a current expression, it was the wrong plant at the wrong place at the wrong time.

Another poster above is correct in assessing the reasons for France's nuclear power success.

Nuclear power can be a 21st-century stop-gap technology. It will never be an ideal solution because of the persistent problems of nuclear waste. It does have the advantage of not contributing to greenhouse gases, and that seems to be imperative at this point.

Somebody, though, must break the news to us Americans that we must start to prepare for a future of airplane travel only for the most urgent reasons, a return to packaging and consumer products that don't rely on petrochemicals, substantial costs to refit our infrastructure for alternative transportation technologies, redesign of our housing for energy self-sufficiency, and generally learning to live lightly on the land instead of swaggering across the earth in combat boots. Sadly, this is a message the End-of-Days crowd and its plutocrat enablers are loathe to consider.

"Oh yeah, the most logical place for high level nuclear waste (dryest, no water table, furthest away from population centers and excedingly difficult to reach), is the only place that it is prohibited. Do you know where that is?"

The Lincoln bedroom?

There is no such thing as safe nuclear power, owing not to the nature of reactor design, plant security, or anything other than the production of nuclear waste. Lots of bad, disruptive things have happened on this planet in the last 450,000 years (not least the arrival of homo sapiens.) The notion that we can safeguard even the existing waste for the next 450,000 is completely insane, and anyone who suggests otherwise is a liar, a fool, and a menace to the human race (and every other living thing on this planet.)

I think I am going to start investing in horses. :)

I think S Brennan meant the Moon, not as kooky as it sounds... but, I'm not very optimistic about the longterm reliability of the safeties on nukes as the population of systems rises. It probably needs the advent of fusion or some process that minimizes the radioactive residuals. It is one thing to have an occasional huge explosion and another to have "On the Beach", or even Kiev.

our country's oil addiction is much deeper than simply the price of oil. while that certainly had much to do with getting us on the horse (so to speak), simply hiking the price up to a level that internalizes the pollution, military, and other subsidies would only make a minor dent in our overall habits. if it didn't first spark widespread protest and demagougery (sp?).

why, simply because our lifestyles and entire conception of the modern american dream is preducated on automobility and private space. we've built our entire urban infrastructure around the concept that we can drive from anywhere to anywhere. our suburbs and exurbs are thoroughly dependent on oil for both residential and commercial uses and they don't have the densities to support the robust public transit systems that would get people to make the transport mode shift. the work needed to densify these areas would require both a throughtful political campaign in order to handle the inevitable NIMBYism that would arise as well as a long term investment policy/strategy that would redirect capital to these areas. it is simply easier to build out on the fringe than in already urbanized areas.

i can envision a oil tax that was directed toward weaning us from oil by improving urban transport systems, investing in alternative fuel R&D, and ameliorating the social costs that would arise from the tax itself. the question is whether anyone in power (it would have to be national in order to have the needed effect) would have the guts to propose something like that then fight for it as the inevitable bullets start flying.

one more thing...

wind power is now more efficient and cost effecting than central station natural gas and prices keep dropping. solar is rapidly becoming more feasible and will likely do so as the market expands, new technology comes online, and greater manufacturing efficiencies come about.

If any lesson seems to emerge from these comments, it is that there will probably not be a single monolithic solution to the energy problem. Various approaches such as solar, wind, nuclear, and biofuel, will *all* have to contribute in whichever ways make the most economic sense. Clearly, the first three can help with the generation of electricity, while biofuels can help run the transportation fleet. Lastly, the urban infrastructure itself will have to be re-engineered in ways that reduce the problems pointed out by Alex in SF.

All of this is very long term, rather like Bush's freedom and democracy campaign... :)

Driest place is Antarctica.

“The per-capita American use of petroleum is probably unsustainable in the long run, while right now our profligacy means sending dollars to terrorist abettors who wind up helping to kill Americans. In 1970 we could say that the market could, if necessary, "correct" the American idea of driving a 7,000 pound, 13 mile-per-gallon gas hog by a simple increase in the gas price. Of course, it can and will do that eventually, but in the meantime a lot of American dollars are going to the wrong people at the wrong time and making energy a question of national security rather than market economics.”

--Victor Davis Hanson

http://www.nationalreview.com/hanson/hanson200501280809.asp

The above comments should be of interest. Hanson is not exactly a left wing radical.

Ed you are correct,

You win today's geography quiz, Green Dem, sit in the back with your equally challenged classmate...George the 2nd.

Green Dem, you should take the time to learn of the Japanese development of a non-mechanical control system for Nuclear Fission that way you wouldn't sound like George the 2nd talking about SSI.

One factor that’s been left out of this discussion is the energy cost of energy extraction. For example, the tarry sands of Alberta contain an estimated 1 trillion barrels of hydrocarbon. To extract the tar requires digging and transporting the sand to a center where heated water is used to float the tar from the sand, and the tar is mixed with naphtha to liquefy it. This procedure requires an energy input equivalent to 2/3 barrel of oil for each barrel of “sand oil” produced. Over 600 billion
barrels of fuel would be required to harvest the Alberta oil sands. We are getting closer to zero return.

"One factor that’s been left out of this discussion is the energy cost of energy extraction."

Yes yes yes. Someone here DOES get it...

Everyone needs to Google "eroei" to see why the majority of the oil deposits we have left untouched so far cannot be exploited- the energy required to dig or drill it out is greater than the energy you would receive in return.

What about the energy costs of manufacturing a brand new Prius? Cheap energy makes cars disposable.