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The Forum > Article Comments > The real cause of high oil prices: an interview with James Hamilton > Comments

The real cause of high oil prices: an interview with James Hamilton : Comments

By James Stafford, published 3/9/2012

Is our energy future one of falling prices and plentiful supply or should we prepare for declining supply and sky high prices?

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The most successful type of commentator is the commentator who leaves more questions open for themselves to address in the future than they answer in the present. This is one such case

I guess one thing I'd be interested to know is how per capita domestic/household consumption of oil varies from country to country (both in quantity and cost since the fuel price varies so widely due to tax rates).

Having lived in Sydney for the last two years I'm a little out of the loop in terms of the Australian penchant for driving vast distances (just because once you're in Sydney there's not reason why you'd want to go anywhere else!-). However I get the sense that Australians probably travel greater distances and use more oil per head for their domestic activities than any other country. Could that be readily changed? I certainly remember when fuel was around the $1.80/l mark it affected my consumption.

...I did actually make a rare 700km round trip in a new Ford Falcon this last weekend and managed to use just over $100 worth of fuel. That's starting to seem like poor value, and not too far away from the "tipping point" at which public transport becomes a good idea...
Posted by Sam Jandwich, Monday, 3 September 2012 11:20:43 AM
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Thanks James; an informative, measured interview from one who knows a lot about the subject. I'd like to see more of the same on this site.

Sam, I ask myself the same questions re cars and travel. Here in NZ petrol is $2.20/L and has been over $1.90 for several years now. One reason is they are more progressive in their taxing of fuel; taxes being around 58c/L and also insurance is charged on fuel rather than with the vehicle license. (The rest of the difference would be due to their relatively low dollar, though they do refine more than half their fuel here)

I think Australia should go the same way with increasing fuel taxes as an incentive for people to be more fuel efficient - use public transport and smaller more efficient vehicles.

However I still see a lot of big driver only vehicles here and few electric, hybrid or small cars. Even though they have lower wages than Aus, the addiction to size, power and luxury seems to pretty strong.
Posted by Roses1, Monday, 3 September 2012 1:30:50 PM
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Can't agree with you there Sammy, The only reason I can imagine for driving in Sydney, would be to get out of the place.

I lived there for many years when out past Liverpool or Sutherland was tiger country. I had enough sense to get out in 72.

I was silly enough to drive through it last year, on my way from "up north" to Nowra, but did not make the same mistake coming back.

My experience was always that you had to drive more miles in Sydney, even back then, just to get to & from work, & that in lousy traffic.

Out of the city, Sydney or any other, I cover less miles as a requirement of earning a living, & can actually enjoy my motoring. The cost of fuel has no bearing on my mileage, & is only likely to have much effect if government rip off went through the roof.

It costs a damn site more in depreciation, insurance, government charges, & maintenance than for fuel. Always has, & always will, particularly with all the new hydrocarbon energy to which we now have access.

Oh, & would you please explain what this public transport is. I remember things called trains & buses in Sydney, do they still exist? If so, please send us some, if only so our kids know what they are.
Posted by Hasbeen, Monday, 3 September 2012 1:36:27 PM
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I agree with "Has been", last time I was in Sydney was 1992, never again. It's a big city but after you have been to some of the worlds cities, Sydney holds no attraction whatsoever. Australia's wonder is in it's wide open spaces, relativity clean air and sparse population, Sydney (and Melb etal) are the antithesis of that, so I choose to live in the country, when in Aus. For the occasional bout of city living I prefer any number of Asian cities.

Back on topic :) When In Aus I ride my pushbike as much as I can, I ride to my partners work, 10km to ride with her and ride back down to ride home with her. I have ordered a another bike and hope to do much longer trips, up to 80km round trips for the odd trip into the big smoke (Grafton)

It seems indolent to drive around aimlessly burning a non renewable fuel, much rather save it.

Even here in Cambodia 10 years ago, nothing, now everyone has a scooter, sure they're comparatively economical but there are still millions of them, before there were none. 10 years time I am sure the roads will be even more choked with cars then now as their GDP continues to grow. The small oil fields they are finding off shore near here will help their balance of payments (leading to more consumerism) and lead to even more corruption for sure (as it does in every other developing country) but will be a drop in the bucket of the volume needed to supply the World.

Ending badly seems the most likely outcome... The US will go to War over Iran's Oil, it has to, it needs it after it sucks IRAQ dry and the lead time will be long.
Posted by Valley Guy, Monday, 3 September 2012 11:24:45 PM
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I'm afraid I can't agree with you on the push bike thing Valley Guy. I once rode one 6 miles out to visit a friend, & then had to ride it home again.

Never again, after that experience I took a horse, at least until I was old enough to get a drivers licence.

I'm sure they are good things in country towns, if your metabolism suits that kind of exercise, but in cities they must be very bad for your health. All the deep breathing required by all that expenditure of energy, is probably not a good thing, when done in the exhaust fumes of thousands of cars.

If cigarettes are carcinogenic, riding a push bike in city peak hour traffic must be even more so.
Posted by Hasbeen, Tuesday, 4 September 2012 12:51:23 AM
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I like riding bikes, and it's true that I yearn for a simple life where I can get around under my own power and rely on public transport for longer journeys. Unfortunately however I am not yet in a position where I can afford to think globally and act locally in this way, and despite technology being what it is my employers still insist I come into the office - 40km from where I live - rather than work from home, and driving is still cheaper than taking the train in Sydney!!

Still, I've put substantial thought into whether it might be possible to radically re-think our lifestyles and make them far far less energy intensive but have come to the conclusion that the world is so far from being ready to do this that it's pretty much pointless. We need only look at Australia's approach to asylum seekers to understand how vehemently people will oppose doing something that may or may not negatively affect them, purely for the good of humanity as a whole.

It does seem a bit short-sighted to keep using up oil though, if it does in fact prove to be a finite resource (not to mention climate change...). I'd be happy for oil to be taxed at a similar rate to NZ if I knew the funds were being used to develop alternative energy sources - and if this affects the economy, then that's ok, because the source of quite a significant proportion of the social, environmental, and resourcing challenges we face are more or less attributable to our already being far too wealthy for our own good anyway!
Posted by Sam Jandwich, Tuesday, 4 September 2012 3:34:23 PM
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