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Could petrol rationing save our economy if peak oil arrives?

Posted by Car Geek on January 10, 2008

When it comes to conservation, we could probably do to learn from the generations that grew up in wartime. The concept of basic supplies like food and fuel being limited just doesn’t register for a lot of us, especially if we’ve had cheap access to both for most of our lives. So would taking a leaf out of the greatest generation’s book and rationing fuel help save us from possible economic disaster?

That’s what the Association for the Study of Peak Oil (ASPO) says. The ASPO’s Australian chapter is calling on the government to consider a return to the practice of petrol allocation, which hasn’t been seen since the Second World War. The rationale for rationing is fairly simple: placing a cap on supply ensures that those with the greatest need for it have it available. The cap also encourages the uptake of alternatives for which no caps exist, such as biofuels or electricity (or perhaps even compressed air). The ASPO likens it to the water restrictions in place in many parts of the nation, borrowing from concepts like carbon trading to allow consumers to buy and sell their petrol allocations.

Unsurprisingly, not everyone has warmed to the idea. Economists such as AMP’s Shane Oliver call the idea “ridiculous”, saying that the market will self-regulate as oil prices rise and artificial measures to regulate supply and demand are unnecessary. Waiting for price hikes to bring the supply and demand curves closer together seems to be the economic status quo currently. Again, allowing the price of oil to rise due to market forces is likely to convince more people to consider petrol alternatives in an attempt to save money.

Petrol rationing certainly has a case for itself. After all, we’re preparing a carbon trading system to alleviate global warming, so why not a petrol trading system to alleviated peak oil? It’s proven effective in wartime situations in generations past. On the other hand, ASPO has (quite unsurprisingly) the threat of an imminent and severe peak oil event in mind, but in the present, petrol allocation may well seem to be an overreaction to a problem that could resolve itself as prices rise, provided there are alternatives for consumers to move to. For my money, petrol prices will need to rise much higher and supplies drop much lower before it becomes a good idea.

(Source: The Age)

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QLD report: peak oil approaching

Posted by Car Geek on September 17, 2007

An as-yet-unreleased report, commissioned by the Queensland government, has thrown its weight behind peak oil theory and warns of significant social and economic symptoms if a peak oil event is approached unprepared.

The McNamara report, led by the new Queensland Minister for Sustainability Andrew McNamara, warns that industries as varied as transport, tourism and agriculture will be adversely affected by a peak in oil production and that “perhaps we have to rethink” government intervention in fuel prices, such as subsidies, which have been noted as potentially contributing to the problem of increased consumption.

Peak oil, the theoretical point at which global oil production reaches a maximum, is predicted to arrive at a wide variety of times, ranging from already occurring to twenty years in the future or further, with some doubting the extent of its impact. One of the report’s co-authors, Jago Dodson, said that government planners need to stop “making things worse” with expanding suburbs that lack public transport, forcing their residents to rely on cars. The impact of rising oil prices is also likely to affect other parts of the economy, according to Dodson.

“As the price of fuel flows through the whole economy, pushing up transport prices, food prices and everything else, it pushes up inflation, which leads to higher interest rates.”

(Source: The Courier-Mail)

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Australia and the peak oil challenge

Posted by Car Geek on August 12, 2007

Luke over at Envirofuel discusses an article by the Australian Association for the Study of Peak Oil about Australia as a microcosm for the global impact that a peak oil event might have. It’s worth checking out if you’re interested in the peak oil debate.

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Expert calls for Australian peak oil study

Posted by Car Geek on June 28, 2007

Visiting US peak oil expert Dr Roger Bedzek is calling on the Australian government to immediately study the effects that peak oil would have on Australia. The former White House consultant is in Australia to give a series of lectures on the theory of peak oil, which states that oil production rates will soon reach or has already reached its highest point. He suggested that Iran’s recent controversy regarding its domestic fuel restrictions highlight the effect that a drop in oil production may have.

“The problem is we’re so tightly stretched now there’s no slack in the system, so even minor perturbations in the system, such as reduced output from Iran, affects the entire world.”

To counter this potential problem, Dr Bedzek is calling on Australia to investigate “possible, aggressive actions on both its supply side and on the demand side”, including energy effeciency measures in transport and alternative fuels including biofuels, hybrids and liquid fuel from coal, as soon as possible to mitigate the effects that peak oil might have.

“It’s going to take a long time, in terms of changing development patterns, running rail and light rail systems, mass-transit systems out to the suburbs and that,” he said.

“If you don’t try to take these kind of mitigation options starting immediately, the ultimate cost to Australia will be many billions more than that [the investment in making the changes].”

(Sources: ABC News, NineMSN)

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