Two hundred years ago, Thomas Malthus claimed famously that the population of the earth would go on increasing until it ran into famines and epidemics. Back then, there were 1 billion humans on the planet; now there are 7 billion of us, but a Malthusian cataclysm is nowhere in sight.
What saved us was technology. If our medicine and agriculture stayed at the same level they were in 1798, famines and epidemics surely would have limited population growth. But now we may have become too complacent in our trust in technology. In particular, we’re confident that technological solutions could not only get us off petroleum as a main source of energy, but do so by substituting harmless “green” technologies for hydrocarbons.
Tech and Oil
Over the past four decades, technology has altered projections in the global oil market. During the double-whammy oil crises of the 1970s, analysts confidently predicted that by about now the world would be out of petroleum—and in fact output fell toward 50 million barrels per day (mbd) in the early 1980s. But now the world is producing nearly twice that amount in order to accommodate demand coming from China, India, Brazil, Indonesia and other emerging economies. Yet, even at its peak in 2011–13, oil’s inflation-adjusted price was about the same as after the 1979 Iranian revolution. And now it is back to where it stood in the mid-1970s.
Spectacular progress in the development of oil exploration and extraction technologies has prevented the depletion of oil reserves. In 1980, the world had 640 billion barrels in proven reserves. That amount had been pumped out by the early 2000s, but today recoverable reserves have actually increased to 1,624 billion barrels.
However, while solving one set of problems, technology tends to create another. New communication and production technologies have led to economic development and the emergence of large consuming classes in Asia, Latin America and even Africa. This impacted oil consumption directly, through the expansion of car ownership. The number of cars on roads around the world stood at 750 million in 2000, but jumped to 1 billion in 2010. It is increasing by 3% every year. By around 2030, we’ll be driving as many as 2 billion cars.
Since cars account for more than half of oil consumption, the global oil industry will need to come up with 130 mbd of oil at current consumption rates. And if China and India, with their current populations, raised their per capita oil consumption to U.S. and Canadian levels, they alone would require 150 mbd.
Burning so much oil would create oil shortages and increase pollution. Whether or not we accept climate change projections, carbon monoxide, nitrogen oxide and other harmful emissions have been found to create a variety of health problems, ranging from heart failure to birth defects and higher child mortality. China’s urban areas are already highly polluted, and India is going through an epidemic of respiratory illnesses in its major cities.
But of course all these problems will be resolved by new technologies, won’t they?
Attempts to diversify away from oil are not new. They have been spurred since at least the 1970s by political as well as economic concerns. Brazil pioneered the production of ethanol from sugar cane. The U.S. ethanol industry is now well-established and politically influential. Amazingly, more than a third of the U.S. corn crop is used to produce ethanol, which provides 6% of U.S. gasoline needs.
The International Energy Agency forecasts a massive shift toward diesel engines by 2025. Diesel engines are as much as one-third more efficient than gasoline engines; besides, there has been a major push, including investment by governments in the U.S. and Europe, to produce biodiesel.