I concur 100% Oil is taken for granted. People in Australia still think that Australia is self sufficient with it's own oil production. Thing is Australia now imports 65% of it's oil and hasn't been a net exporter of oil since 2001 … and the gap is ever widening!

When oil was priced at 11 dollars per barrel, the cost at the pump was between 60 to 70 cents depending on which part of Canada you live. At 80 dollars per barrel, the cost is around one dollar to one dollar fifteen. The increase is around 40 cents per litre of gasoline.
I reckon if the price of oil reaches 300 dollars the price per litre, it would cost $2 to $2.50 which is still manageable by many drivers. All drivers have to do is drive less, or buy a more economical car as do Europeans. Even the cost of a bus ride would not increase that much by the higher cost of fuel.

Thank you for a thoughtful article. What are you talking about reminds me of the argument James Laxer made in his book Oil and Gas back during the deep recession of 1982-1983. All of those big plans for the Tar Sands were put on hold indefinitely for the very reasons you mention above. It is funny how so much has not changed in thirty years.

Hello Jeff,

I just finished reading your book, and I have a few of questions. I do not know the best way to reach you, so I am positing this here with the hopes that you will see it, and perhaps (fingers tightly crossed) respond.

1. What if this isn't just your standard run-of-the-mill recession, what if it is more than that?

Right at the beginning, you make it clear that your conclusions in the book are based on the premise that the current down turn is a recession, not a depression, and that when things return to normal, this is what is going to happen.

But what if this recession isn't cyclical, but structural. What if this recession is the end result of 30 years of bad policy (including cheap oil), short sightedness, corruption and unsustainable practices? What if this recession is really a depression, and all of the tricks that the central banks have to re-inflate the bubble just aren't going to work this time?

In short, if this is a depression, and it is going to last much longer than what most experts are telling us, how, if at all, would that change any of your conclusions?

2. Taxing carbon emissions v. cap and trade.

In the book you explain how carbon taxes could work, and you give a great argument for why this tax is a competitive advantage for developed economies (not the disadvantage that we are often told that it would be) and that it should be implemented immediately.

You also mention Cap and Trade as a way to regulate emissions and equalize labor imbalances.

I am skeptical of cap and trade, but perhaps I shouldn't be. Have you seen this presentation against cap and trade by Annie Leonard?

http://www.storyofstuff.com/capandtrade/

Do you agree with her premise and conclusions? If not, (and I know that this is a lot to ask), could you offer a rebuttal?

3. Implementing carbon emission taxes

How do we do this? It seems to me that countries aren't going to do this, without knowing, for sure, that the other G20 countries are also doing it, especially the US. With the amount of corruption and dysfunction we see from the US Congress, I don't think we can expect to see any meaningful (or, at this point, even meaningless) legislation coming out of The Cesspool, previously known as Washington, D.C.

Am I wrong? Are you hopeful that carbon emissions taxes can be a reality soon? What can we (everyday citizens of the world) do to make this happen?

If you would like to reach me directly, I am available on LinkedIn at http://ca.linkedin.com/in/kateconner

Thank you for writing your book. I hope that it is widely read, especially among our leaders and policy makers.

Sincerely,
Kate Conner

I totally agree with Mr. Rubin and the fact that the Central Banks will do all they can to keep this ponzi economic growth going by debasing their currencies. Everybody who thinks that Oil will be cheaper going forward is living in a “myth”. The fact is that Oil is a finite commodity and the low hanging fruit has already been plucked. As the global consumption grows, the cost of producing additional barrels will only go higher. But what I am concerned is the sustainability of the current world economic system is at risk as oil prices move higher. Everyday the world is using more oil than the day before. Unless, we make some drastic changes to the way we live, our whole society is in for a rude awakening !!

Everything is going to be just fine. Check out the world in 10 years!

A lot has changed. Global oil production was rising in 1982. It maxed out about 2005 and has been in plateau since then, presumably ready to decline precipitously any month now. The world cannot import oil. We're probably also looking at a collapsing currency, something new since1982. Not to mention that we've lost 40% of the phytoplankton in our oceans recently. Isn't that kind of like the doctor telling you that half your liver has been eaten away?

I think both. Hyperinflation coming soon as well as real declines in oil production, not to mention shortages in virtually every other natural resource.

Isn't it a fact that the world has never produced more oil than it did in 2005? Why not, we should certainly have better technology. Why did BP go deep ocean? Couldn't they just grab the light sweet crude that we have so much of?

I agree that a lot has changed environmentally (and for the worse). What I am referring to is the economics of oil production. The fundamentals of oil production have not changed. The tar sands is only possible because of the high levels of investment that are being put into it. This is the same as 1982. The tar sands were put on hiatus back then because of the dramatic drop in the price of oil during the 1980s. And Alberta was already running out of conventional fields then as well. The difference today is that the Alberta tar sands have become even more appealing to the United States because of the desire for “secure” production outside the Middle East (and the Chinese are also looking closely at guaranteeing their own access to them). But as was the case back in 1982, the tar sands are only productive if a tremendous amount of investment (the majority of it foreign) is brought in because the cost of heavy oil refining is too high if the currency is low or the value of oil per barrel is low. Canada does not have a collapsing currency now but one that actually is tied to commodities that are increasingly in demand like oil, canola, wheat, uranium and potash. But that said, a superheated market for heavy oil is not a cause for rejoicing. And you are absolutely right about the environmental costs. I am against the tar sands so what I lament is how the economic argument has not adapted to meet the needs of the ecological crisis.

I don't know what will change minds short of a more economic source of energy. And that is really depressing. Clearly arguments on behalf of preserving the web of life do not convince many people because they seem to be too abstract (even though they really are not). But the loss of coral reefs or the depletion of phytoplankton is not pressing for enough people so that we witness a consumer rebellion against fossil fuels. And in Canada, the centrality of the tar sands in the development of the national economy makes it almost unthinkable that politicians or opinion leaders would begin to seriously press for shutting the tar sands down. And in an era of economic insecurity, the natural world becomes more and more peripheral. Or so it seems.

There will be some pipelines apparently running through Idaho. There were some minor protests in response to fleets of giant trucks that are already running through some small towns, but this was not front-page news. Interestingly, polls show that an overwhelming majority of Americans support trying to get energy from solar & wind, while at the same time only 37% of them say they “believe in” climate change. American politicians, including Obama, won't even dare utter the word climate anymore.