The "Economist" on oil - a critique
Jerome a Paris gives a balanced assessment of the special report on oil in the current issue of the Economist. Highly recommended. Some excerpts are given below.
[from Part III]
(The Economist is a very influential, and usually well written British weekly widely on business and current affaires read by global corporate leaders. It has a fairly transparent bias in favor of free trade and capitalism).
[from Part I]
The Economist has published in its most recent edition a survey of oil, which I promised to review here. As it is behind a subscription wall, the links (below the jump) are unlikely to be accessible to most of you, so I have tried to summarise its content before critiquing it.
In a nutshell, this is the well-informed, but nevertheless deliberately rosy official view of corporate America.
At this point in the survey, there is nothing really objectionable. It presents a reasonably balanced view of the oil markets and the factors influencing it (although it glosses over the Iraqi war), of the short term economic consequences of more expensive oil, and it has a good perspective on the challenges faced by the oil majors, many of which I agree with and have pointed out in previous diaries.
[from Part II]
The Economist does not believe in peak oil. They do mention it, and provide some links to serious websites about peakoil (such as www.peakoil.net and www.hubbertpeak.com/), but the whole article is meant to contradict them.
So basically [The Economist is saying]: don't worry, be happy, the big companies will save the day with new technology, so we won't need more oil, but there is enough oil anyway should we need it...
It's pretty disappointing, but not surprising really. As a part of the Establishment, The Economist plays a role in setting the meme for the global corporate elite. This is clearly a very professional, interesting "don't rock the boat" piece. will it be overtaken by facts quickly or will it help perpetuate out countries noxious blindness on the topic of energy?
[from Part III]
That the Economist writes positively of such phenomena [Geo-greens] is in itself positive; this could be a wedge issue against big corporates and Republican pork that should be pursued.
To sum up on the three diaries, it would be fair to say that despite their rosy views on reserves and oil production, the Economist acknowledges that energy is a vital issue and that the current status quo on oil is unsustainable: Western majors are running out of oil and, even if there is enough as they claim in the Persian Gulf countries, it is going to present major geopolitical and economical problems to bring all the oil currently burnt in the US to the consumers.
As high gasoline prices bite, Bushco should be fully blamed for that, both in tactical terms for not doing anything about prices, and on strategic terms for not doing anything about the long term dependency of the US on a few unstable and/or unfriendly countries.