Joules Burn

Oil Price Impact in Perspective

Interesting point. But to be accurate, you should conclude by saying that gas COSTS for DRIVING are 50% below their highs in the 1980s. Prices are slightly higher, and the driving of cars doesn't account for all of the oil costs in the economy.

Something else to look at would be the gas costs relative to the median income as opposed to the per capita GDP (which will be skewed towards high earners).

Finally, there is the airline industry. There has been a rather pronounced increase in efficiency there to:

www.airlines.org/econo...

So, what's the big deal? Mostly that their (until recent) prices were designed for the fuel costs of a few years ago. The question will be whether their business model can change as fast as future fuel price increases.

BP CEO: Three Oil Myths

The 2008 BP review is at:
www.bp.com/productland...

As for the Minister of the Church of Supply and Demand, who commented above: keep the faith, baby! When the doubters come a callin', just drag out the old whale oil non-analogy (tho you did forget to mention the stone age not ending for lack of stones) and the vast hydrocarbons just waiting to be dug up and baked out of shale. You also neglected hydrocarbons from Titan and (a true believer's favorite) abiotic oil.

Let us close with prayer:

"Dear Invisible Hand..."

Biofuel Innovators with Alternatives to Oil

There is really no scenario in which biofuels can contribute significantly to the liquid fuel supply in the short term. Even with an immediate breakthru, the capital investment necessary to build enough plants and/or distribution infrastructure just isn't there. Plus, you need automobiles which can utilize it -- either ethanol-capable or a lot more diesels.

In the longer term, you have to consider which options are actually scalable. Non-agricultural crops as input sounds great, but in most cases, unless you are returning something back to the soil, soil viability over the long term is not assured. Research on corn stover indicates that only a certain amount can be harvested (without plowing it back) without degrading the soil.

Ah yes, algae. The golden species. Lot's of promise, yet many challenges. Photovoltaic cells usually do what we want them to. In contrast, algae have their own agenda. But even if large-scale biodiesel production using algae can be done, the question to ask is still...why? Photosynthesis, even using algae, is still a comparatively poor way to capture solar energy. Subsequently burning it in an internal combustion engine fritters away even more energy.

The alternative, electrification of transportation using energy derived from solar or wind, offers a much better utilization of the available energy. Challenges are many down that path as well, but mindlessly clinging on to the ICE with the hope that algae will deliver will guarantee that crops continue to get diverted to fuel production in the short term.

Our Energy Efficient Economy Can Handle $112 Oil

Yes, there is likely a scenario by which the USA could get along with what Canadians pay, and another one for what Europeans pay. The key is the transition from where we were to where they are. Ask independent truckers and major trucking companies how that transition is going. Or airlines.

Our Energy Efficient Economy Can Handle $112 Oil

In response to "anengineer", what you say would be true if the US was manufacturing the same amount (relative to the size of the economy) but just more efficiently, but it is not. It is perhaps great that the rest of the world will pay the US to push paper, write software, etc., but that fact masks the effect of higher priced energy on the economy. Energy drives the world's economy, and a higher cost for that energy will impact the US the same as anywhere else.

Our Energy Efficient Economy Can Handle $112 Oil

The problem with an analysis such as this is that the US Economy is not a closed system. If you look at this graph:
www.geocities.com/Wall...
you will see that the percentage of the GDP that is manufacturing has gone down by about half. What does this mean? Quite simply, China is doing a lot of our energy-intensive manufacturing -- and using their energy to do it.

$200 Oil Is a Very Real Possibility

Pie in the sky numbers like 2 trillion barrels mean squat. What counts is the rate at which it can be produced, and we are now having to get it from a) smaller and smaller fields or b) deep under the ocean floor or c) by digging it out of the ground and then baking and hydrogenating it to make it it flow (e.g. tar sands). The net result is less net energy available to power your car on, no matter what the price is. And to make matters worse, more and more people want that oil.