Oil, unlike other products and services obey not only the laws of supply and demand but also the laws of geology. You cannot make more oil you have to work with what is available. If you are wondering if we are running out of oil, then rest assured that we are not. The oil reserves that are there will probably run another 100 years. Experts theorize as to whether we have reached what is called the “Hubbert’s Peak” where 50% of oil reserves have been depleted and the remaining 50% gets increasingly harder and expensive to extract. If we have, expect the prices on oil pumps to increase over the coming years.
While we can build nuclear power plants and erect wind turbines, these will not add a barrel of oil to the world supply because generally oil is not used for electricity. In some cases, these plants will run on oil and thus have no long-term solution.
With countries like China and India experiencing economic growth, they are fueling the thirst for oil and the world’s appetite for this commodity is not going to diminish as a result. America however, remains the world’s largest oil consumer and as a result, do not expect prices on oil pumps to be showing any signs of going down anytime soon. The need to develop new and more efficient technologies becomes increasingly vital as we move towards the “Hubbert’s Peak”. Innovation, this time, will mean surviving the energy crisis.