Doesnt it make economic sense to start finding alternatives to using crude oil for the worlds energy needs?

If the economic theory is true that we never ever run out of natural resources, we simply find cheaper ways for extracting/producing them or find cheaper alternatives; after all, the prices of all commodities have been falling over the past 100 years(not sure if this applies to crude oil), doesnt it make more economic sense now to start finding alternatives to using oil?

12 Answers

Relevance
  • NC
    Lv 7
    1 decade ago
    Favorite Answer

    The alternatives have been identified long ago. The reason they remained alternatives and did not become mainstream is very simple: cost. There are several "magical" thresholds in the pyramid of alternatives.

    If oil consistently costs above $40 a barrel, tar sands, sugar-cane ethanol, and synthetic gasoline (derived from either natural gas or coal) become viable alternatives. At $50 a barrel, shales become viable. At $60, corn ethanol kicks in. And, finally, at $80, biodiesel becomes profitable.

    The key word, however, is CONSISTENTLY. The industry remembers very well what happened to alternative fuels back in the 1980s. A short period of exuberance was followed by a protected decline when oil prices fell.

    There is also heavy oil (whose supplies exceed those of conventional oil), which until very recently was thought to be unrecoverable. Now Chevron is developing a steam injection technology that is thought to be able to recover up to 40% of heavy oil.

  • Anonymous
    1 decade ago

    No, we are not that close to running out of oil and people are still paying what ever price is asked at the pump. Very few people are really changing how much gas they use. There hasn't been a big surge in demand for more efficiency in cars. I think we will keep on paying what ever the oil companies ask for some time yet. They aren't interested in a replacement for oil. When oil really gets scarce we will see some industry funded research into something to replace it, but it won't be something cheap for us. We will still have to pay through the nose for our energy. We have already shown them that we will.

  • 1 decade ago

    But if you find an alternative energy source it will leave Oil companies with $3000 trillion of unsold oil.

    Thats why the majority of US politicians have some form of financial interest in the oil industry.

    Many alternative energy sources have already been found but the patents and rights have been bought out by oil companies so they have no competition...

    theres a movie you should watch titled "what happened to the electric car?" or something like that....

    very eye opening

  • 1 decade ago

    Sure. As oil runs out, supply is cut, so price rises. As price rises, energy companies try to make more money be finding cheaper forms of energy so they can increase their margins (how greedy of them!). Thus, alternative fuels are cheaper and the companies produce them on their own, without government interferience. Don't worry; of the companies aren't working on it, then that means that oil is our best source of energy! Otherwise, energy companies would use alternative fuels to increase their profit margin. Note the abasence of government intervention from this mechanism.

  • How do you think about the answers? You can sign in to vote the answer.
  • 1 decade ago

    not really, all other forms of energy are more expensive than oil per BTU, except nuclear. we have enoough crude oil for 100 years, andbeyond that, we have enough shale oil just in the midwest US for 300 years. ethanol costs more than oil to distill. electric cars are less efficient than gas cars, because you use oil burning generators to charge the batteries

  • 1 decade ago

    Yup they do exist, but they are nowhere as efficient as crude oil. wind, solar and hydro powers require huge amounts of investments and they are also not as reliable.

    Alternative fuels, will actually cost more, because besides the cost of producing the crop,and refining the oil, you will also be paying the cost of loss food. ethanol and biodiesel are also inefficient sources of energy.

  • 1 decade ago

    Yes, unfortunately, big oil is very powerful and they continue to find ways to keep good alternatives from coming to fruition. I don't think any of the feasible alternative will be successful in replacing oil until U.S. politics is less....political. (my attempt at being politically correct) :(

  • ?
    Lv 5
    1 decade ago

    yes this can be done but too many people are making big money because everyone needs gas. When it all runs out an alternative will be used

  • Anonymous
    1 decade ago

    It is going on right now. All over the planet, new ways of producing energy is being sought. Hang in there. Something viable will be found. I hope it's cold fusion.

  • Anonymous
    1 decade ago

    Work is already in progress. It's called Ethanol. Sort of like rubbing alcohol but made from corn.

    In fact they've been working on it for over 5 years.

Still have questions? Get your answers by asking now.