Saudi Oil Moguls fear Hybrid Cars
Saudi Arabia wants lower petroleum prices. As a country with enormous reserves, Riyadh would like to preserve their value. In contrast, countries like Algeria with relatively shallow reserves want to get top dollar for their petroleum while it lasts.
Businessweek provides the telling quote:
' Any threat to oil's leading role as a source of energy is a big worry for a country that sits on reserves of some 260 billion barrels. "We are concerned about the permanent destruction of demand," says a senior Saudi official. "Those who buy hybrid vehicles are not going back to SUVs." '
posted by Juan Cole @ 9/28/2008 01:32:00 AM
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9 Comments:
Of course they do ... but that doesn't mean that we are going to dance to their tune.
We need alternative sources of energy, and the "drill baby drill" crowd are just plain stupid. They are just going to delay the problem for future generations. And maybe wait until it is too late for a smooth transition.
As a general supporter of the peak oil story, especially the part about the Saudi peak, I'll put this in the column for doubts about dire supply/demand situation in the short to medium term.
Hybrids are not going to effect consumption much at all for at least 10 years. What the Saudis should worry about is demand destruction caused by the current high prices and the general worldwide macro economic conditions. Conditions which suggest a serious actual shrinkage of output.
They may not sell them in Saudi Arabia, but there are hybrid SUVs.
What on earth gave this senior Saudi official that idea? Americans switched to smaller, fuel-efficient vehicles once before, and then oil prices kept sinking. What did we do? Leave CAFE standards on the shelf and introduce the ridiculous Hummer.
This gentleman obviously overestimates American interest in things such as thrift or long-term thinking.
The Saudis are nearly as shortsighted as the Americans are. They must have recognized in the past that an economy based on the export of a single, finite natural resource is extremely vulnerable.
The Saudis have cash spilling out of their pockets at the moment which they could devote to diversifing their economy for the long term.
There are thousands of square miles in the Saudi interior that are virtually uninhabited. Saudi Arabia has long coastlines to the east and west. That situation provides the Saudis with at least three options to create alternative exports to petroleum.
They could get into the
1.) Electricity export business. Install large banks of solar arrays and a transmission infrastructure to neighboring countries.
2.) Fresh water export business. Desalinate seawater using petroleum fuel immediately but transition to solar power for daytime use as quickly as possible. Continue running on petroleum power (eventually replacing petroleum with domestically produced ethanol) during the nighttime hours. Build a rail and or pipeline infrastructure to neighboring countries.
2a.) Hydrogen production from desalinated seawater, both for domestic power generation and for export as above.
3.) Ethanol export business. There are numerous species that grow in the most arid Saudi desert conditions that are perfectly suitable for use as biomass in cellulosic ethanol production. Start large-scale plantings of biomass now.
Could such commentary by a Saudi be a way of addressing internal discontent because the Saudi masses aren't seeing much benefit from high oil prices?
Natural oil has more useful applications than being merely a source of energy. Given the problems that arise from burning oil (e.g. producing greenhouse gases), reducing the price of oil is the wrong move at the wrong time. This reduction in price only encourages us to continue with our wasteful use of energy; it also discourages investment in research for discovering new sources of energy that are clean, or at least cleaner than burning fossil fuels.
Saudi Arabia, along with other oil-rich countries, must take advantage of the present high oil prices and invest their surpluses into technologies that use oil for other purposes than merely burning. In this way, these countries will continue to enjoy high oil prices, contributing at the same time to a healthier environment. They will also advance science and stimulate search for new and useful technologies, such as renewable energy sources.
In my opinion, the recent proposal by Saudi Arabia is utterly short-sighted and cynical. It is reminiscent of Mike Figgis’ 1995 motion picture “Leaving Las Vegas” (with Nicolas Cage in the main role). In this film, the screenwriter Ben Sanderson (Nicolas Cage) empties his saving account and moves to Las Vegas to drink himself to death. The proposal by Saudi Arabia of reducing oil price for encouraging its consumption is, when put into practice, as nihilistic an action as moving to Las Vegas for drinking oneself to death. We should realise that our present financial woes arise mainly from artificially low interest rates (compare with low oil price), encouraging us to spend more than we earn and more than we produce in terms of real and tangible goods. Reducing the price of oil will have similar disastrous consequences for the environment and a plethora of other things, such as slowing down our search for efficient renewable energy sources.
BF.
ref : “Saudi Oil Moguls fear Hybrid Cars”
indeed, In lieu of any Republican or Democratic leader(s) directing the American public to reduce consumption of all petroleum products as a National Security issue, hybrid cars, and in a broader sense: l'idée ‘hybrid transport’ would appear to be the clear and present danger to commodity-extraction economies ~ so long as they, themselves remain otherwise un-productive.
but imho, Though l'idée, today of ‘hybrid vehicles’ may send a shiver, l'idée of an entirely alternative tomorrow ~ of ‘hybrid dwellings’, of ‘hybrid culture’ = the collapse and rebirth of the sub-urban lifestyle invention ~ with its dysfunctional "lawn" green spaces, "drive ways and shopping means to unsatisfying ends", etc. ~ This (uniquely American cultural Phoenix phenomenon, by tradition unbound by tradition, of re-creating ourselves yet again, shamelessly), will be a realization of The West's remedy to the ennui of their OIL : the clear and present enemy of our future.
Personnally, I wonder whether the Saudi didn't take that stance only because they were pressured by Bush : high gazoline prices aren't good for the Republicans just a month away from the election, so they may be trying to keep very low prices.
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