Fossil Fuel Futures

The world will not literally “run out” of petroleum during the twenty-first century. However, at some point, extracting the remaining petroleum reserves will prove so expensive and environmentally damaging that use of alternative energy sources will accelerate, and dependency on petroleum will diminish.

Reducing Demand

Demand for petroleum has been dampened in developed countries in two principal ways: conservation and pricing.

• Conservation. Factories have reduced their demand for petroleum, primarily by consuming more natural gas. The average vehicle driven in the United States got 22 miles per gallon in 1985, compared with 14 miles per gallon in 1975. A government mandate, known as Corporate Average Fuel Efficiency (CAFE), was responsible for the higher standard. Other countries have also mandated more fuel efficient vehicles.

• Price. Under OPEC control, world oil prices have increased sharply on several occasions, especially during the 1970s and 1980s and in the early twenty-first century. The average price paid for a gallon of petroleum exceeds $8 in most developed countries. When adjusted for inflation, prices are not high by historical standards in the United States, and they are lower than in other developed countries.

Oil Price History

Oil prices have changed sharply on several occasions.

U.S. Gasoline Prices

Fuel prices increased sharply in the 1970s and again in the 2000s, but subsequently declined in both periods.

The U.S. Department of Energy forecasts that energy consumption in the United States will increase from around 100 quad BTU in 2017 to around 110 quad BTU in 2050. Because of population increase, consumption per person is forecast to decline by around 20 percent. Consumption of natural gas and energy from sources other than fossil fuels is expected to increase, whereas consumption of petroleum and coal are expected to remain virtually unchanged.

Pause & Reflect 11.2.4

Do you consider fuel efficiency when you or your family buy a new vehicle? Why or why not?

Unconventional Fossil Fuel Resources

Resources are considered unconventional if we lack economically feasible or environmentally sound technology with which to extract them. As demand increases for a resource and prices rise, exploiting an unconventional source can become profitable. Here are two current examples related to fossil fuels:

• Oil sands. Abundant oil sands are found in Alberta, Canada, as well as in Venezuela and Russia (Figure 11-42). Oil sands are saturated with thick petroleum commonly called tar because of its dark color and strong odor. The mining of Alberta oil sands has become profitable, and extensive deposits of oil in Alberta oil sands have been reclassified from potential to proven reserves in recent years. As a result, Canada is now thought to have 10 percent of the world’s petroleum proven reserves.

• Hydraulic fracturing. Rocks break apart naturally, and gas can fill the space between the rocks. Hydraulic fracturing, commonly called fracking, involves pumping water at high pressure to further break apart rocks and thereby release more gas that can be extracted. The United States has extensive natural gas fields, some of which are now being exploited through fracking. Within the United States, the principal natural gas fields are in Texas, Oklahoma, and the Appalachian Mountains. Opponents of fracking fear environmental damage from pumping high-pressure water beneath Earth’s surface. Safety precautions can minimize the environmental threat, but fracking does require the use of a large supply of water, and water is in high demand for other important uses, such as human consumption and agriculture.

Alberta Oil Sands

Hydraulic Fracking

Natural Gas Fields in the United States

The issue for the world is whether dwindling petroleum reserves are handled wisely and peacefully during a transition process of substituting other energy sources. Given the massive growth in petroleum consumption expected in developing countries such as China and India, the United States and other developed countries may have little influence over when prices rise and supplies decline. In this challenging environment, all countries will need to pursue sustainable development strategies based on increased reliance on renewable energy sources.