The Financial Times notes that weak European currencies mean that residents there are facing oil prices at or near all time highs. That prompts a quick look at OECD oil consumption. Unfortunately, it's hard to get very up to date international data on oil consumption, even for developed countries. The EIA data used here currently goes through September 2011. As you can see above, developed country oil consumption has been generally declining since at least 2007 - I think it's likely that the developed world has already seen peak oil consumption, given very limited growth in world production and burgeoning demand in developing regions.
Here is more detail on the three main groupings shown above (not zero scaled):
Consumption was increasing slightly following the great recession, but then began to decrease again at the beginning of 2011 as the Arab Spring, Libya in particular, increased prices. In the second half of 2011, it seemed to be increasing again, but I would expect that European consumption at least would be declining since as Europe has gone into a double dip recession while facing near record oil prices.
At this point, continued happiness in developed countries will have a lot to do with their ability to become more energy efficient quickly, particularly more oil efficient.
8 comments:
Interesting that all of the decline - point to point - has come from the U.S. and Other... Europe ended where it began... I should expect that to change soon...
Lot more fat to cut in the US, I'd say...
Yes, I suspect that's right... the rate of change is more likely to intensify in the U.S. as ethanol is a one off and the gains in domestic oil production will likely slow and then end altogether...
Who is more affected by an increase in oil prices, the suburban US family with 2 cars, one of them a 15 MPG SUV, a family that drives a combined 500 miles a week, or a Chindian family, getting their first car, a small one, that they maybe drive 50 miles a week?
One family buys 25 gallons of gas a week and the other maybe 2. Sure, the US family still has a higher income, but maybe that isn't enough to matter.
I think this is why even in the face of high oil prices, millions of new oil consumers in the developing world are still becoming new consumers of gasoline and diesel. Those first few gallons a week that the developing world consumers purchase is a lot more marginally useful and valuable than the 23rd, 24th, and 25th gallons the US soccer mom buys that week.
The same thing can happen with electrical kilowatt hours too. Those first few watt hours one uses to light a light or two and run a small fridge are very valuable as we see in developing African villages where a bunch of families hook into a small solar electric system. The 487th and 488th kilowatt hour of the month that Joe and Jane Sixpack buy for their air conditioner, meanwhile, isn't as valued.
Thus, US oil consumers are bidding against many, many small oil consumers, new, small consumers that will pay dearly for those first gallons.
Stephan,
I think you have a good point. When discussing the effect of increasing oil prices on people in different countries it could be of interest also to look at the cost of petrol there. I guess the German would be happy with the US petrol prices, but then they would of course have to pay the corresponding taxes some other way to get the same services from society.
USA 3,99 $/gal
Kenya 4,54 $/gal
India 5,74 $/gal
Germany 8,21 $/gal
http://www.kshitij.com/research/petrol.shtml
What Stephen B. said.
It may be that Chindia et al growth acts as a negative lever on "us".
Stephen,
That's a good observation: the US family can easily cut their fuel consumption with very little impact on their life.
They can switch most driving from the 15MPG SUV to the 30MPG Corolla; they can trade in the SUV for a hybrid or an EV, et, etc.
Heck - they can go with a Leaf for one vehicle, for up to 70 miles per day (which is 90% of all driving), and use the Corolla for the rest - that will probably cut their consumption by about 90%, with almost no impact on their lifestyle.
Of course, a minority of households will actually need the SUV for some portion of their driving, so their choices get a bit more complicated.
They might go with the the cross-over Prius to replace the SUV, or combine the SUV with a Volt.
Lots of choices, almost all of them very cost effective and convenient.
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