The oil energy crisis

The oil energy crisis

The importance of oil
Energy is the most important resource in human life. Energy issues have repeatedly affected the nerves of society. It is the most basic and core power issue that concerns people’s reality and future survival and development. Several major leaps in human modern history have benefited from the development of energy, and several major global crises have also been caused by the energy crisis. In today’s economic globalization and the multi-polar world political landscape, ensuring the continuous supply of energy and establishing an energy security supply system have become the starting point and core content of the energy strategies of all countries in the world today.

From the perspective of the distribution of energy supply and demand, the term “imbalance” can reveal its fundamental characteristics. It is this imbalance that has fundamentally led to various international disputes and even wars arising from resource problems. From international relations in recent decades, it can be seen that oil resources and water resources are the main factors in the continuous wars and conflicts between countries. In particular, seeking to control oil resources has become one of the focal points of international struggles. In the past 20th century, there were more than 500 conflicts caused by oil alone, and more than 20 of them evolved into armed conflicts. With the increasing shortage of oil and water resources, the restrictive effect of energy on economic development will become more prominent, and the global energy competition in various forms will also intensify.

In the industrial field, oil is called the “industrial blood”. The rise in international oil prices has had a significant impact on many industries. It has triggered the rise in the prices of related manufacturing raw materials such as electricity, coal, chemical fiber, cotton, metals, and building materials. Further transmission to the downstream, triggering an increase in the price of finished products.

The petrochemical industry, aviation industry and automobile industry have been more impacted by rising oil prices. The rapid rise in international crude oil and aviation fuel prices has led to a continuous and substantial increase in the cost of the world’s air transportation industry, and fuel costs account for more than 40% of the total cost of airlines. . At the same time, soaring oil prices have made the textile industry even worse. In addition, industries such as fertilizers, pesticides, coatings, fuels, soda ash, plastics, and chemical fibers are more or less affected by high oil prices.

Oil shortage
Dating back to the 1860s, oil was an abundant resource that could not be exploited. Early prospectors only needed to drill shallow oil wells to find large oil layers, which caused oil to flow to the surface under its own pressure. The easily available oil and natural gas reserves have been exhausted, and now oil companies need to work hard to find new underground deposits. The oil extraction wells are shown in the picture. The average oil well is more than 3,000 meters deep, and only about one-third of the new wells can actually find oil. The increasingly tense situation of oil resources makes the world’s major economic powers and energy organizations pay attention to how much crude oil still exists on the earth. The US “Oil and Gas Magazine” weekly pointed out that the world’s proven crude oil reserves are currently about 1.2 trillion barrels; while “World Petroleum” monthly magazine believes it is 1.03 trillion barrels. Even if calculated based on the highest crude oil reserves, at the current consumption rate, and considering the annual consumption growth rate of 2% to 3%, the existing crude oil reserves will be exhausted in less than 40 years. The search for oil has become an expensive activity, which has led today’s surveyors into extreme environments: remote deserts, frozen Arctic, and even underwater operations. At present, the oil produced in the Arabian Gulf, the North Sea and the Gulf of Mexico accounts for about 1/3 of the global oil. Putting these resources from afar into production is even more expensive: the trestle bridge of the Statford Drill B is one of the largest and most expensive buildings in the world. It takes thousands of miles to take the oil out of the oil well and transport it to the refinery, and it also requires a lot of additional costs.

Many scholars have analyzed the reasons for the sharp fluctuations in oil prices, such as “the depreciation of the U.S. dollar promotes soaring oil prices”, “speculative trading fuels the flames”, “political and climatic factors”, “outdated oil extraction equipment waiting to be updated”, “energy game among major countries” “Global inflation has increased”, and so on. These analyses are reasonable, but the frequent occurrence of oil crises and the intensified international oil price continue to rise is the fundamental reason for the insurmountable and difficult to alleviate contradiction between the limited reserves of world oil resources and the increasing global consumption. Oil and natural gas, as non-renewable resources that have been severely consumed, face a bleak prospect that will inevitably be exhausted between two or three generations. In order to compete for this dwindling resource, it is inevitable that the countries concerned will be struggling with each other, raging conflicts and even local wars.

According to the current rate of fossil fuel extraction in the world, oil can be used by mankind for 40 years, natural gas can be used by mankind for 65 years, and coal can be used by mankind for 162 years.

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