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Are higher oil prices a bad thing?

June 17th, 2008 · Greg Atkinson · No Comments

Let me dare to suggest to readers of this blog that perhaps higher oil prices are in the longer term, good for the world and good for business. I know this may offend motorists and companies struggling to deal with the additional costs associated with higher prices, but before anyone sends me any nasty comments let’s look at the reasons for my apparently insane comment.

1. We waste oil. Yes, that’s right, we waste oil just like we waste food and water because it has been relatively cheap. Airlines operate flights that are less than 50% full, people drive large SUV’s to work without passengers and most people have cars that are far bigger than what they need. This is wasteful and means we burn more oil than we need to. Wasting a non renewable energy source is plain stupid and in a few hundred years future generations will think we were all morons. They will also wonder why on earth anyone would burn oil for heating for example, or why everyone seems to need a 4WD urban assault vehicle to drive one child to school.

2. Oil has been cheap. You pay a lot less for petrol at your local petrol station then you do for wine at your local liquor store. (unless you really drink some cheap wine) Wine comes from a renewable source and is a lot more environmentally friendly than oil. People do not often waste wine because it costs more, if oil costs more the same will happen. Not wasting oil is a good thing.

3. We have become too dependent on oil. In a few hundred years people will think we are morons because we failed to use the abundant sources of renewable energy we have on planet earth. Because we have become hooked on oil we have not been forced to use these other sources of energy, however higher oil prices will change that and that my friends is a good thing. Higher oil prices will also result in more money being spent on research and development into alternative sources of energy such as geothermal, solar and tidal.

4. We do not live in energy efficient cities. Most of the cities in the world are oil wasters. People seem to be okay that billions of dollars are spent on freeways so we can funnel more cars and trucks into the transport system, but perhaps a better alternative would be to enhance public transport, build more light rail lines and cycleways etc? Rather than our cities thirst for oil, why don’t we do something to lessen the demand for oil, not increase demand? If the price of oil remains high then maybe our minds will switch permanently to “saving oil” mode.

5. We are becoming unhealthy and overweight. Perhaps when it becomes too expensive to jump into the “4 litre mini people mover all new SUV” to get a carton of milk people might, just might, walk to the shop instead! Maybe people will walk the 10 minutes to the station to catch the train instead of driving to the station. Maybe there might even be some safe places to park your bicycle at the station instead of just a multi layer car parking stations. Perhaps a higher oil price will means people will exercise more by walking and cycling etc and this can only help us become more healthy.

So maybe higher oil prices are not such a bad thing after all?

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