Cheap and plentiful oil in the 20th century allowed the internal combustion engine to replace the steam engine. Oil has now become essential to almost every sector of the UK's economy and those of other nations around the world. Modern food production is a good example - oil is essential from the field to the delivered product.
A growing number of people in and around the energy industry are warning that global oil supply will soon fail to meet present demands and the increasing demands from large developing countries and a rapidly rising global population. Evidence suggests that the world is at or close to its peak oil production. Peak oil production is when the depletion of existing oil reserves can no longer be replaced by new flows entering the system. Production reaches its resource-limited maximum, and then declines.
All is not well with the discovery and production of new supplies of 'easy, cheap oil' i.e. conventional, easy-flowing crude oil. The oil production figures of all five major international oil companies have been falling over the last few years. Soon very heavy investment will be needed for exploration of areas of unconventional oil production, e.g. in Canadian tar sands, ultra deep water, pre-salt layers etc.
The International Energy Agency has warned of an oil crunch by 2013. This does not allow a timely transition to alternatives that can replace a falling oil supply.
We are leaving an era of cheap energy.
The 2008 'Oil Crunch' report published by the UK Industry Taskforce on Peak Oil & Energy Security (ITPOES) expresses concern that oil prices have been rising and the industry is not discovering more giant oil fields. They are further concerned by the underinvestment in the key areas of infrastructure and skilling. Much of the oil industry's infrastructure (drilling rigs, pipelines, tankers, refineries etc.) were built 30 years ago and its physical state may be a problem. The average age of oil industry personnel is 49 with an average retirement age of 55.
If fuel prices keep rising and it becomes more difficult to obtain fuel when you need it on the road at filling stations what will you do?
• Plan now for the future security of your fuel supply.
• Look at ways to reduce fuel usage to minimise cost.
• Know how, when and how much fuel is being used by your organisation.
• If we are to reduce oil consumption and conserve supplies we must reduce the amount of fossil-fuel-based road transport.
• Energy efficiency and energy conservation need to be maximised.
• Investment is needed into renewable energy e.g. transport fuelled by sustainable bioliquids and electricity.