Energy is wealth. In today world and modern civilization, energy has become so essential above roof for our head and food on the table. Electricity light, refrigerator, vehicles, power plants, shopping complex, houses and even lamp street is powered by energy. Today oil and gas has become primary source of energy replacing coal. As we know that oil and gas is limited in supply as our consumption has set all time record high since oil field is discovered during 1859 by Colonel Drake in Titusville, Pennsylvania.
Since year 2002, oil price has been incidentally increase as consumption progressively absorbed most of the reminder of world's buffer of excess capacity, which reached 10 million barrels a day in 1986. In years past, the buffer of such excess capacity of oil being produced, natural disaster in the scale of Katrina and Rita will not produce any shock to the oil price. By 2005, even an unexpected maintenance shutdown in some big refineries plant in the world will drive the price higher. Oil price has been so sensitive as our daily consumption keep growing especially at some emerging country such as China which the consumption rate is growing at exponential pace. In US alone, there are 8 million of gas gazzling truck on road everyday, which consume up total gasoline more than all the vehicle added up in Europe.
In today market, there are many other uncertainty that will drive oil price crazy. Volatility has been highest since 1971 oil crisis in US under president Nixon administration. Terrorism that prevail across middle east and some other oil producing country will create a treat to the safety of its refineries plants. Any strike to those refineries plants will result oil price to spike overnight. It is true that there are numbers of innovation in oil and gas industries such as deep sea exploration, yet such the high cost of such operation will not mitigate the price of oil. OPEC, recently had very reluctant in increasing its output capacity to accommodate the increasing demand of oil from the world. Oil reserve from the developed country has gone very low from 113 billion barrel during 1997 to less than 80 billion barrel in 2006. Such depletion of reserve will soon run off, therefore there will be no buffer to any surge of demand from day to day. Price of oil will be so sensitive, with any sudden surge of demand will sky rocket the price. Even being reported there are number of new oil field are discovered, the refineries capacities could not promise to handle the new discovered oil, at least for few years to coming. It take years to upgrade the technology in refineries capacity, and it is very costly. Another treat is global warming and changes in climate across the globe. Numbers of disasters has been reported to hit oil producing country like Indonesia. Such unpredictable incident could create a shock in oil market.
Before the first gulf war during early 1990s, oil price has been about 20 usd per barrel. During 1991 to 1999, oil price are at the range of 20usd/barrel to 35usd/barrel. But since 2006, oil price had reach all time record high at more than 110usd/barrel. It all drive up by the factor of supply and demand. IEA (International Energy Agency) recent contingency forecast, assuming the OPEC will lag in expanding its crude oil capacity, the average world price of oil will be at 130 usd/barrel. Oil demand on 2030 will be surprisingly strong according to the IEA pundits at about 116 million barrel a day versus 84 million barrel a day during 2005. Such surge in demand which do not accommodate with proportional increase of supply will drive oil price to some astronomical number. What will you do if the price of oil increase more than 50% or even 100% overnight? What is your salary growth rate? Can you afford to drive your car anymore? What will affect to your spending pattern if energy bill is so high? Energy price will not only cause gasoline price increase but also, any businesses associated with it including transportation, manufacturing and even some other services provider. Your utility bill will be increase if the oil price is high.
Yet, not to be too pessimistic on current trend of oil price. many innovative measurement had been taken. Hybrid cars is introduced to replaced high fuel consumption vehicles. Conservative and renewable energy become more popular in developed country powered by wind and solar. Nuclear power is one of the key to replace power plant that run by hydrocarbon despite of it unpredictable aftermath reaction. Still, history had proven that most of the nuclear reactor across united state had found no dramatic side effect to people and environment. Study had justified that a great scare of Mile Island incident of interrelationship of nuclear power plant to thyroid cancer during 1979 - untrue. Nuclear power plant by prudently utilize, could create the energy that human race ever needed now. It does not emit any green houses gases as conventional hydrocarbon generated plant. Greenhouse effect has been another major issue apart from financial problem & terrorism that our civilization is facing now. Other innovative, is the battery technology. If such innovative is successful, and by apply such technology into cars and trucks on road, in US alone, you can save up 9.5 million of gasoline consumption and 2.5 million of diesel consumption daily on highway alone. If the new innovation of battery technology with alternative green energy can emerge in major way, soon, human race will be no longer rely on "black energy source". Could that be a euphoria realistic future or just a pipe dream? Only human race can answer that question with proper initiative actions.
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