Tuesday 28 February 2012

Get Fracking!

Oil and gas (and electricity) are vital fuels for our modern way of life. It is hard to imagine what our lives would be like without them.
For most of us, hydrocarbons are being burnt every single minute of the day to make our lives more tolerable.
Most of our electricity is still generated from the burning of fossil fuels, so your fridge for example, is more than likely running on coal. Then of course you have the gas central heating keeping you warm, and gas oven allowing you to cook your food, and don't forget the petrol/diesel that gets you to work everyday!
According to the Sunday Times (26.02.12), of the 203 million tonnes of oil equivalent energy we used in 2011, 185 million tonnes came from fossil fuels, 15.5m from nuclear, while wind and hydro power were just under 2m (less than 1%!).  The same article also states that North Sea petroleum and gas production were down 17% and 20% respectively. Imports of oil are now greater than UK production for the first time since 1978.

This backdrop paints a grim picture for the future of our oil and gas prices. With surging demand from emerging economies like China, India, Africa etc, prices of oil and gas are set to go only one way in the long run. Up! These higher prices will pose the biggest long term threat to global growth.

Hopefully new technologies in the oil/gas exploration industry, such as fracking, will increase supply and temper the rise in demand, thus buying us time to build some renewable energy infrastructure, so that the eventual transition from hydrocarbons to renewable sources might be less painful. Fingers crossed!


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