Ideas 2012 July/August 2012

Actually, Fossil Fuels Are Here to Stay

It has been obvious to all of us for some time that pretty soon the Earth is going to run out of fossil fuel. This has been the conventional wisdom not just among Prius drivers, Whole Foods shoppers, and solar-panel manufacturers, but within the fossil-fuel industry as well. In 2008, Ron Oxburgh, a former chairman of Shell, said, “It is pretty clear that there is not much chance of finding any significant quantity of new cheap oil.”

But thanks to new discoveries and new technologies, the end of fossil fuels is not looking quite so imminent. From the oil sands of northern Alberta, to America’s massive pockets of shale gas (American gas reserves would last at least 75 years at current consumption rates), to the vast offshore oil reserves that Brazil hopes will make it the world’s fourth-largest producer by 2020, fossil-fuel sources we didn’t know about or couldn’t use are suddenly available. Crucially, many of these supplies are found in thriving democracies—a dramatic shift from the past, when oil and autocracy seemed to go together.

The resurgence of fossil fuels will create new winners in the global economy—oil is one reason Brazil is on the rise, and shale gas could be a source of America’s economic rebound after the 2008 slump. Oil could complicate domestic politics in countries with too much of it—there is a reason economists talk about “the curse of oil,” and dictatorships have thrived in countries with abundant natural resources.

This newly available fossil fuel will intensify the fierce battle about the environment, as we have already seen in the fight over the Keystone pipeline. These deposits aren’t the easy-to-drill ones we got used to in the 20th century. They are hard to reach, and extraction will have a rougher impact on the environment. They will also be the source of high-paying jobs and will allow us to live in our comfortable, commuter-based, fossil-fueled economy decades longer than we expected. The challenge of weaning ourselves off fossil fuel even as it becomes more abundant will make the old fights about energy conservation seem like child’s play.

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Chrystia Freeland is the editor of Thomson Reuter’s Digital.

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