According to the BBC, – http://news.bbc.co.uk/2/hi/business/4130532.stm – oil prices in Asia have reached $62.69 per barrel on August 8, 2005. Though there will be plenty of commentators that minimize the impact of that very high price by referring to the inflation adjusted prices from the early 1980s, the fact remains that oil prices are nearly 3 times as high as they were just 4 years ago.
In 2001, OPECs stretch goal for a target price was $22-28 per barrel and the members were having to restrict production in order to reduce supply enough to get to that goal. There is essentially no usable spare capacity left anymore. Increasing the rate at which oil can be extracted from the ground will require huge infrastructure investments and it cannot be done overnight. There are simply not enough skilled people and not enough equipment available.
In another related article, the BBC – http://news.bbc.co.uk/2/hi/asia-pacific/4129808.stm – reported another coal mine accident in China that has trapped more than 100 miners. As is often the case, the article ends with a comment about the Chinese coal mining industry’s poor safety record, the pressure that the industry is feeling to meet ever increasing demands, and the conflicting fact that the government says that they want to improve the safety record at the same time that they need to increase production even more.
Finally, Bloomberg – http://www.bloomberg.com/markets/commodities/energyprices.html – reports that the price of natural gas at NYMEX Henry Hub is $8.80 per million BTU as of 0300 August 8, 2005. To put that price in perspective, the average price in August 2002 at the same location was $2.76. That is a 220% increase in three years, and it is mainly due to the ever increasing demands for natural gas in electric power plants at a time when production capacity is not increasing.
There is plenty of available capacity to increase energy output from uranium, especially if the people in the groups organized to stop its growth learn how limited the competitors are. It is time to start a world wide effort to build new nuclear power plants.
