Tag Archives: economic

Oil prices and the devil’s ransom Updated for 2026





There has been a fascinating debate developing in the environmental movement – particularly in The Ecologist – over the meaning and effect of the oil price collapse.

Most recently, environmental consultant Paul Mobbs declared that “environmentalists should be cheering on OPEC!” for increasing production and lowering prices, thereby driving the ‘unconventional’ production (like tar sands mining) out of the threshold of economic viability. Unfortunately, the debate seldom zooms out at some of the broader conditions that caused the collapse.

Mobbs’s enthusiastic support of oil production in Saudi Arabia manifests a powerful rebuttal to Steve Melia’s dispatch on the troubled thesis of peak oil.

Whereas Melia claims we must continue to resist fossil fuels for the sake of the environment through civil disobedience not unlike the vital anti-roads movement of the 1980s, Mobbs seems to believe that “keeping the oil in the ground” will be counterproductive to the short-term goals of environmentalists.

Symptoms of a wider economic malaise?

To shore up his hypothesis, Mobbs argues against Melia’s claim that low prices are a challenge to the peak oil hypothesis of gradually increasing prices. The ecological metabolism of peak oil is responsible for the oil price crash, since the increased production of oil stems from high-cost and low-yield production, such as tar sands, which is being undercut by Saudi oil, causing oil prices to decline.

But, Mobbs ventures, this is not a sign of the supply and demand of oil. Instead, it is a complex phenomenon that involves the stagnation of the whole economy. Mobbs cites the declining prices of other commodities as evidence.

Mobbs does not provide a clarification by referencing recent economic events, which hinders his argument. After the housing market crash of 2007, investors from more prosperous financial centers of the world shifted capital to land speculation and resource extraction in the Global South.

This ‘spacial fix‘, to use geographer David Harvey’s term, remains part of an economic program called ‘credit easing’, through which junk loans are backed by land grabs. The so-called ‘fracking revolution’ in the Bakken Shale plays an important role in the US’s own attempts to emerge from the recession.

Busting the global resource grab

According to the US Energy Information Administration’s (EIA) Adam Sieminsky, “just six tight gas plays taken together account for nearly 90 percent of domestic oil production growth and virtually all domestic natural gas production growth in the last 2 years.”

Bakken is 67% of oil growth, and Marcellus is 75% of gas growth. Bakken is relatively low-cost, high yield, while Marcellus has proven far more problematic for investors in the area (due in large part to the sheer amount of speculation happening).

But therein lies the rub: a financialization bubble bursts, leaving resource extraction to mop up the mess, but the glut of oil production is facing diminishing markets abroad. Between 2008-2015, production will have expanded by 3 million b/d, while US demand will have fallen by 1.5 million b/d.

With Saudi Arabia refusing to maintain the high prices by decreasing its own production, choosing instead to “ride out the oil price slump” as the NY Times put it, the relative growth of production against demand has caused low prices.

As oil prices decline, the prices of other commodities decline, because oil factors into every level of the supply chain, from the manufacture of the machines to work a mine or a tractor to the running of the machines themselves to the manufacture of the commodity to the transport of the commodity to market, and virtually all transports in between.

Due to the oil prices, food prices, for instance, are predicted to drop 10-15%, according to Arab News. Furthermore, along with the sharp rise of oil production since 2008, the extraction of tin, copper, and virtually any other commodity has risen as well.

Gluts have appeared across the board, while demand has declined-a phenomenon that has caused tremendous problems in supply chains for countries like China and Brazil.

In the North Atlantic, on the one hand, the banks have refused to invest in small businesses and homeowners, and on the other hand, working people have less confidence in the economy and their political representatives. Hence the Fed and the ECB have been unable to switch back from extractionist positions of ‘credit easement’ to their earlier financial policies.

Geopolitical games – or coincidence?

There are at least three spins that one could put on the oil price collapse and its implications. The one preferred by industrial actors around the world expounds the low price as a natural fix, which will decrease production, increase consumption, and eventually drive the price back to a higher equilibrium.

The challenge here would be, as Mobbs indicates, maintaining high-cost, unconventional projects at a price equilibrium, but that is a matter of eventuality, since the conventional crude is running out.

The second spin is that collapse of oil prices marks a natural boom-bust cycle of extractivist oligarchs who push supply beyond demand, only to have markets contract into a perfect situation for further speculation.

The final spin, of course, is more closely related to the attempts made by the BRICS countries to shift away from petrodollars and dollar hegemony while cutting oil and gas networks throughout Asia without regard for the interests of NATO.

This final proposal marks a gap in Mobbs’s thesis: namely that it is OPEC that is responsible for the price decline. Instead, it is largely Saudi Arabia, with Venezuela taking a brutal hit to the balance books, and scrambling to prop up prices.

As The Telegraph noted, lower prices is bringing about a possible new era, which is ushered in not by OPEC, itself, but by an inter-OPEC crisis marking the crucial geopolitical rift that the oil price collapse plays into.

For its part, The Economist‘s blog, Buttonwood’s notebook, has put up a cheeky graph identifying the Red Army signal showing how every price collapse in oil has come directly after a Russian foreign intervention: most recently, the intervention in Crimea, the 2008 invasion of Georgia, and the 1979 invasion of Afghanistan before it, which prompted Saudi Arabia to increase oil production and saturate the market.

This is the “cunning of history”, and the US’s connections to the House of Saud stands as reason enough for The Economist‘s bloggers to gloat. What is left between the lines is what Vijay Prashad calls “dispossession by manipulation.”

Opposing interests clash on Middle East battlefields

All the above proposals may, in fact, have some degree of truth, but the crucial focus should not necessarily be Russia or Venezuela or even Iran, but the battlefields on which their interests collide.

The oil price collapse is hindering Iraq’s ability to fight the menace of IS that remains ensconced in its third largest city, Mosul, while retaining the social services necessary to maintain a tenuous order.

Supporting the Kurds seems to have been the US’s most successful attempt thus far in confronting IS in Northern Syria and Iraq, but the presence of Kurdish HPG guerillas in Iraqi Kurdistan, who are also connected to the Kurdish YPG/YPJ self-defense forces fighting IS in Northern Syria, rankles the Turkish government to no end.

Turkey does not want to see its southern territories turned into an autonomous Kurdistan tied to the Kurdish Regional Government in Iraq. In fact, the Turkish state seems more willing to help IS than the Kurds. If the Kurds are unable to fight down IS, oil prices will rise once again, which seems to be in the interests of oil producers.

An old Kurdish proverb states, “A head that is to be cut off cannot be ransomed” – and it applies here: IS serves a purpose, if not a devious one. Although the EIA posits that oil spot prices will continue to decline until 2018, prices may settle to a bottom later this year, only to increase once again because of regional discord.

And having sent Russia, Iran, and Venezuela a cruel message, along with Iraq and the Kurds, the North Atlantic oil companies may return to their traditional profits and risky, unconventional projects against the will of environmentalists like Mobbs who see the current price collapse as a prospect for greener pastures.

 


 

Alexander Reid Ross is a contributing moderator of the Earth First! Newswire and works for Bark. He is the editor of ‘Grabbing Back: Essays Against the Global Land Grab’ (AK Press 2014) and a contributor to Life During Wartime (AK Press 2013).

 




389095

Oil prices and the devil’s ransom Updated for 2026





There has been a fascinating debate developing in the environmental movement – particularly in The Ecologist – over the meaning and effect of the oil price collapse.

Most recently, environmental consultant Paul Mobbs declared that “environmentalists should be cheering on OPEC!” for increasing production and lowering prices, thereby driving the ‘unconventional’ production (like tar sands mining) out of the threshold of economic viability. Unfortunately, the debate seldom zooms out at some of the broader conditions that caused the collapse.

Mobbs’s enthusiastic support of oil production in Saudi Arabia manifests a powerful rebuttal to Steve Melia’s dispatch on the troubled thesis of peak oil.

Whereas Melia claims we must continue to resist fossil fuels for the sake of the environment through civil disobedience not unlike the vital anti-roads movement of the 1980s, Mobbs seems to believe that “keeping the oil in the ground” will be counterproductive to the short-term goals of environmentalists.

Symptoms of a wider economic malaise?

To shore up his hypothesis, Mobbs argues against Melia’s claim that low prices are a challenge to the peak oil hypothesis of gradually increasing prices. The ecological metabolism of peak oil is responsible for the oil price crash, since the increased production of oil stems from high-cost and low-yield production, such as tar sands, which is being undercut by Saudi oil, causing oil prices to decline.

But, Mobbs ventures, this is not a sign of the supply and demand of oil. Instead, it is a complex phenomenon that involves the stagnation of the whole economy. Mobbs cites the declining prices of other commodities as evidence.

Mobbs does not provide a clarification by referencing recent economic events, which hinders his argument. After the housing market crash of 2007, investors from more prosperous financial centers of the world shifted capital to land speculation and resource extraction in the Global South.

This ‘spacial fix‘, to use geographer David Harvey’s term, remains part of an economic program called ‘credit easing’, through which junk loans are backed by land grabs. The so-called ‘fracking revolution’ in the Bakken Shale plays an important role in the US’s own attempts to emerge from the recession.

Busting the global resource grab

According to the US Energy Information Administration’s (EIA) Adam Sieminsky, “just six tight gas plays taken together account for nearly 90 percent of domestic oil production growth and virtually all domestic natural gas production growth in the last 2 years.”

Bakken is 67% of oil growth, and Marcellus is 75% of gas growth. Bakken is relatively low-cost, high yield, while Marcellus has proven far more problematic for investors in the area (due in large part to the sheer amount of speculation happening).

But therein lies the rub: a financialization bubble bursts, leaving resource extraction to mop up the mess, but the glut of oil production is facing diminishing markets abroad. Between 2008-2015, production will have expanded by 3 million b/d, while US demand will have fallen by 1.5 million b/d.

With Saudi Arabia refusing to maintain the high prices by decreasing its own production, choosing instead to “ride out the oil price slump” as the NY Times put it, the relative growth of production against demand has caused low prices.

As oil prices decline, the prices of other commodities decline, because oil factors into every level of the supply chain, from the manufacture of the machines to work a mine or a tractor to the running of the machines themselves to the manufacture of the commodity to the transport of the commodity to market, and virtually all transports in between.

Due to the oil prices, food prices, for instance, are predicted to drop 10-15%, according to Arab News. Furthermore, along with the sharp rise of oil production since 2008, the extraction of tin, copper, and virtually any other commodity has risen as well.

Gluts have appeared across the board, while demand has declined-a phenomenon that has caused tremendous problems in supply chains for countries like China and Brazil.

In the North Atlantic, on the one hand, the banks have refused to invest in small businesses and homeowners, and on the other hand, working people have less confidence in the economy and their political representatives. Hence the Fed and the ECB have been unable to switch back from extractionist positions of ‘credit easement’ to their earlier financial policies.

Geopolitical games – or coincidence?

There are at least three spins that one could put on the oil price collapse and its implications. The one preferred by industrial actors around the world expounds the low price as a natural fix, which will decrease production, increase consumption, and eventually drive the price back to a higher equilibrium.

The challenge here would be, as Mobbs indicates, maintaining high-cost, unconventional projects at a price equilibrium, but that is a matter of eventuality, since the conventional crude is running out.

The second spin is that collapse of oil prices marks a natural boom-bust cycle of extractivist oligarchs who push supply beyond demand, only to have markets contract into a perfect situation for further speculation.

The final spin, of course, is more closely related to the attempts made by the BRICS countries to shift away from petrodollars and dollar hegemony while cutting oil and gas networks throughout Asia without regard for the interests of NATO.

This final proposal marks a gap in Mobbs’s thesis: namely that it is OPEC that is responsible for the price decline. Instead, it is largely Saudi Arabia, with Venezuela taking a brutal hit to the balance books, and scrambling to prop up prices.

As The Telegraph noted, lower prices is bringing about a possible new era, which is ushered in not by OPEC, itself, but by an inter-OPEC crisis marking the crucial geopolitical rift that the oil price collapse plays into.

For its part, The Economist‘s blog, Buttonwood’s notebook, has put up a cheeky graph identifying the Red Army signal showing how every price collapse in oil has come directly after a Russian foreign intervention: most recently, the intervention in Crimea, the 2008 invasion of Georgia, and the 1979 invasion of Afghanistan before it, which prompted Saudi Arabia to increase oil production and saturate the market.

This is the “cunning of history”, and the US’s connections to the House of Saud stands as reason enough for The Economist‘s bloggers to gloat. What is left between the lines is what Vijay Prashad calls “dispossession by manipulation.”

Opposing interests clash on Middle East battlefields

All the above proposals may, in fact, have some degree of truth, but the crucial focus should not necessarily be Russia or Venezuela or even Iran, but the battlefields on which their interests collide.

The oil price collapse is hindering Iraq’s ability to fight the menace of IS that remains ensconced in its third largest city, Mosul, while retaining the social services necessary to maintain a tenuous order.

Supporting the Kurds seems to have been the US’s most successful attempt thus far in confronting IS in Northern Syria and Iraq, but the presence of Kurdish HPG guerillas in Iraqi Kurdistan, who are also connected to the Kurdish YPG/YPJ self-defense forces fighting IS in Northern Syria, rankles the Turkish government to no end.

Turkey does not want to see its southern territories turned into an autonomous Kurdistan tied to the Kurdish Regional Government in Iraq. In fact, the Turkish state seems more willing to help IS than the Kurds. If the Kurds are unable to fight down IS, oil prices will rise once again, which seems to be in the interests of oil producers.

An old Kurdish proverb states, “A head that is to be cut off cannot be ransomed” – and it applies here: IS serves a purpose, if not a devious one. Although the EIA posits that oil spot prices will continue to decline until 2018, prices may settle to a bottom later this year, only to increase once again because of regional discord.

And having sent Russia, Iran, and Venezuela a cruel message, along with Iraq and the Kurds, the North Atlantic oil companies may return to their traditional profits and risky, unconventional projects against the will of environmentalists like Mobbs who see the current price collapse as a prospect for greener pastures.

 


 

Alexander Reid Ross is a contributing moderator of the Earth First! Newswire and works for Bark. He is the editor of ‘Grabbing Back: Essays Against the Global Land Grab’ (AK Press 2014) and a contributor to Life During Wartime (AK Press 2013).

 




389095

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391

‘Peak oil’ – the wrong argument for the right reasons Updated for 2026





Collapsing oil prices should give everyone in the ‘green movement’ cause for reflection.

With lower prices forecast to last for the next couple of years, two lines of argument for sustainable energy – economic and peak oil – are now looking rather weaker. Equally, the case for reconsidering the arguments and the tactics of political environmentalism has strengthened.

Peak oil as an argument for environmental change was always flawed, as recent events have illustrated. Some writers and environmental organisations mention peak oil alongside wider environmental arguments for a transition to sustainable energy use (see this review for example).

Peak oil supporters predict that the price of oil will inevitably rise as ultimate exhaustion approaches. Rising prices, not lack of availability, will make oil-based products unviable.

Making sure the oil is left in the ground

If everything is left to the free market that scenario would undoubtedly occur at some point in the future. But what if the green movement achieves its aims of lower consumption, and switching to renewable energy sources while there’s still plenty of oil in the ground?

Remember the comment made 15 years ago by Sheikh Yamani, the former Saudi Oil Minister: “The Stone Age came to an end, not because we had a lack of stones.”

His suggestion was that lots of oil might remain unused, as the world switched to superior alternative energy sources – much as our ancestors stopped using stone for tools and weapons because other materials were more effective, notably bronze, iron and steel.

But the analogy with the Stone Age is misleading. Sustainable energy does not have obvious advantages for industry or consumers, never mind its wider benefits.

And even with very cheap solar power and large, efficient industries dedicated to converting it into fuels for aviation and other transport uses, it’s unlikely to compete on price with Saudi Arabian oil, whose production cost is around $5 per barrel

But if we are to avoid catastrophic climate change, most of the world’s fossil fuels will have to remain in the ground, according to the IPCC. So the success of any transition strategy will depend on artifically increasing the price of oil (and other fossil fuels), and / or applying regulations that discriminate against their use.

Being economical with our arguments

Peak oil is one of several ways conventional economics have been used to promote sustainable aims. As economic growth has faltered and governments have become obsessed with ‘the economy’, campaigners, professionals and academics have felt compelled to express their arguments in economic terms.

This has produced what later, saner generations may regard as ludicrous extremes. Several reports have attempted, for example, to justify the benefits of walking and cycling or the disbenefits of pollution on economic grounds – as though longer healthier lives were not sufficient justification in their own right.

This approach has proved no more effective than other ways of influencing politicians and business leaders. Cost-benefit analyses of transport projects typically show that small-scale pedestrian and cycling projects generate the highest rates of return.

So why do politicians who say they believe in the conventional economics behind cost-benefit analysis pour vastly more money into road-building and high speed rail, than into far cheaper, more effective and sustainable options?

I have been to many conferences where the presenters seem to implore: “if only we can show them the right economic evidence they’ll change their minds.”

This wishful thinking misunderstands the role of evidence and economics in political decision-making.

Building roads, and ignoring the evidence

In the mid-1990s the Conservative Government of John Major abandoned the ideology and the practice of big road-building, prompting a lively academic debate about the real reasons for these changes.

Some writers pointed to an influential report by SACTRA, a parliamentary committee, which amassed a convincing body of evidence that road-building is self-defeating because it “induces” more traffic.

Two other influences on the Major Government were pressure from the Treasury to cut public spending and the anti-roads protests which delayed road schemes and increased their cost.

No convincing evidence has emerged to challenge SACTRA’s findings since then, and yet those lessons have been comprehensively un-learned. The Coalition Government’s Command Paper Investing in the Future does not even pretend to offer any evidence for its claims about the economic necessity of road-building.

The CBI’s roads report Bold Thinking states that “the long-term benefits of road investment are well-known”, which is all the evidence they need. A senior civil servant from another country with a neoliberal political culture recently visited our research centre on a fact finding mission.

He reported similar views in his own country adding that “there’s a lot of scepticism about the health benefits of walking and cycling” as they appear in cost-benefit analyses. The evidence on road building and the economy is no stronger but these claims fit more easily with the values of political and business elites.

Faced with that reality, the argument that we must act sustainably for the sake of the economy was never going to persuade many decision-makers. In a context of low oil prices it will convince no-one.

Protecting the enviroment for its own sake (and ours)

When that argument becomes a common message people hear from the green movement, it weakens the values most readers of The Ecologist would share – that we must protect the environment for its own sake and for future generations (for a psychological analysis of the reasons for this, see the WWF report Common Cause).

If we are ever to change the values and practices of elites and the general public we must remain consistent, even when our arguments seem to be falling on deaf ears.

Comparing today’s situation with the mid-1990s, the evidence on road building hasn’t changed. The pressures on public spending are even greater. And yet the government is committed to spending £15 billion on building and ‘improving’ roads.

The fact that the bulk of the expenditure is being targetted at Tory and LibDem marginal constituencies tells us something important about how govenments really reach their decisions.

Make it political!

But that’s not all. One important element we are lacking today is the mass campaign of civil disobedience that rose up against Mrs Thatcher’s ‘biggest roads programme since the Romans’. We can only conclude that it must have been considerably more influential than most of us realised at the time.

It also tells us that to persuade government to force the transition away from fossil fuels, making economic arguments – however sound and well founded on irrefutable evidence – is never going to cut the mustard.

We have to make the transition to sustainable energy a political decision in the run-up to the 2015 election – and do what it takes to make the issue one that politicians cannot afford to ignore.

 

 


 

 

Dr Steve Melia is a Senior Lecture in Transport and Planning at the University of the West of England. His new book, ‘Urban Transport Without the Hot Air’, will be published by UIT Cambridge in May.

 

 




388391