Sunday, May 2, 2010
Back to the Future: $100 Oil May Return Soon
I hope your not getting too comfortable with today's gas prices. This summer the cost of a barrel of oil might go well over a $100, currently the cost is $86.15. The reason behind this rise is economic recovery is developing nations such as India and China. An interesting fact that I didn't know before reading this article, US consumption of oil has actually decreased 5% the past 10 years, while Chinese consumption has increased 73%.
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I think the only reasonable solution to this problem is to increase investment in renewable sources of energy like solar and wind. In the long run, they will have two key benefits. First one being that they are environmental friendly and secondly due to their abundance, there will hardly be any supply shortages which in turn would not drive up prices.
ReplyDeleteYes that would be ideal, Iqbal. However the demand for solar and wind energy will rely on high prices of oil. In the summer of 2008, gas prices were extremely high and renewable sources of energy was a hot topic. Today the topic is barely mentioned because everyone is happy with the low gas prices. So I believe that an increase will give solar and wind energy more attention by the government.
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