The past few years have been eventful in the world of energy. Oil prices climbed to over $80 per barrel and are expected to remain around that level for the foreseeable future. While the calculated by us equilibrium price of oil should hover around $40, geopolitical headlines rule the price and the world is constantly one large headline away from $100 oil. There is a substantial imbalance in the location of energy producers and consumers, an imbalance that has precipitated world conflicts and one that will likely cause future upheavals. Prominent among these areas is the
One obvious bright spot for the future is that energy consumption in the generation of wealth and the forms of primary energy sources has not been constant throughout the last two centuries. Of considerable significance is the change of fuels from wood to coal to oil and now to natural gas and, eventually, hydrogen will play a role. Distorting the economically sane path to the future is the confusion deriving from the current lack of overlap between primary energy sources such as oil and natural gas and improbable ideas for alternative energy sources such as the practically energy-negative bio-fuels, headed by ethanol or, even more outrageous alternatives such as solar electricity. Distorting the picture even further is the entire rhetoric of global climate change, it's presumed by some anthropogenic component, and the proposed solutions, bound to add to energy costs and energy availability.