30 Benefits of Expensive Petroleum

Long-term Benefits of Expensive Petroleum

These benefits will not be noticeable by ordinary everyday users. However these are real benefits and often lead to strategic shifts which last over several years. It most often affects individuals, communities and countries.

1. I have predicted that the price of foods will go up by about 150 % because the EU and the US have legislated the use of bio fuels in their fossil fuels to reduce carbon emissions. Bio fuels are cheaper and cleaner than fossil fuels. Please read the article here.

Quote, “On Friday 4th. July 2008 the European Union announced that it would continue to push ahead with plans to see bio fuels account for at least 10 per cent of energy used by the bloc's huge transport sector by 2020”. Hence it is reasonable to conclude that production and usage of bio fuels will increase.


2. It is known that bio fuels are cleaner and cheaper than current fuel prices. In the long run the greater usage of bio fuels will lead to a cleaner environment and increased quality and quantity of life.
3. Production of bio fuels will be done by agricultural countries. Hence there will be a strategic shift from fossil rich fuel producers of the Middle East to agricultural countries of Asia, Africa and America. The Middle East will lose its strategic importance as a supplier of fossil fuels.
4. The Middle East countries which are raking in money now will end up paying for bio fuels in the future. These countries will be least prepared for the change. Some countries are now producing as much as 25 % of their energy from bio fuels. Brazil is one such example. I must confess that shifting to bio fuels will push up prices of essential food items. This will negatively impact poorer people of poorer nations.
5. A new breed of small generators and energy producers will be born. These new generators will run on bio fuels produced on small energy farms. The small energy producers will feed energy into the main grid. The business model for this energy generation will be similar to small farms.
6. There will be a decrease in terrorism. One of the reasons for increased terrorism is the “disfranchised” feelings of the youth of the Middle East. They have the money and do not have “useful motives” in life. This environment creates terrorists. Young men who are involved in energy production and useful economic activities will want to live see the rewards of their labour!
7. Initially there will be many producers of energy. Later there will consolidation of energy producers and big energy farms. Upward and downward mergers will produce synergies which are still not known or predictable.
8. Shipping lanes which transport fossil fuels will become less important strategically. The Straits of Hormuz will become tourist spots not strategic military bases.
9. Tankers which transport fossil fuels will become dodos because more bio fuels will be produced where they are needed most. Asia, Africa, America and Europe will become self sufficient in bio fuels which will be supplemented with nuclear energy.




Agricultural countries will produce food for humans and bio fuels for cars.


10. The number of nuclear power stations will increase globally
11. Bio fuel producers will become strategically important because food prices and bio fuel prices will need to be balanced
12. Other forms of energy e.g. methane gas from organic waste and energy from solar panels will become more important.
13. As the numbers of energy producers increase the cost of energy will decrease. However, we all know that the population of the world is increasing so the amount of agricultural land is decreasing. Therefore there will be a net increase in the cost of energy.
14. In the long run human beings will adjust to the higher price of petroleum and they will accept it as normal. Also, they will accept smaller cars as they will be more fuel efficient.
15. There will be more fuel efficient cars with fewer emissions and less release of lead and carbon into the environment
16. Smaller cars will become cheaper as the unit cost of production goes down due to increased demand
17. The harmful “greenhouse effects” will not bring about global warming
18. Producers of food and bio fuels will become strategically important again