What warnings do the oil shortage scares of the 20th century offer us today?
Sudden increases in the price of oil have resulted in panic and the erroneous conclusion that the oil era is rapidly coming to an end. Between 1915 and 1916, the price of oil increased nearly five-fold, leading to a prediction that US oil would be depleted within 27 years. That did not happen. Between 1977 and 1982, the price of oil increased almost three-fold, with the CIA concluding that global oil production was near its peak. However, by 1986 the price of oil had fallen back to its 1977 value, as there was an oil glut. It is true that supply disruptions due to natural disasters and world events have resulted in oil price increases. But the long-term trend in the inflation-adjusted price of oil has not increased, which suggests that oil scarcity does not exist. To what degree will the growing needs of developing nations, such as China and India, control global consumption? The greatest pressure on oil use is certainly the increasing demand in developing nations. In the US, there are
