Advocates of green energy insist that the price of carbon fuels keeps on going up as the world runs out of them and so we must spend gazillions investing in windmills and solar panels etc. Just for the record, as new oil and coal discoveries continue to be made the facts are rather different.
Here is a chart of the inflation adjusted oil price. It uses an American crude (Illinois)
which is about the same as West Texas Intermediate (WTI) which is the standard US measure and trades today at $95 a barrel.
You will note that in real terms oil is cheaper today than it was in 1979. The data for coal is not that dissimilar (in real terms in it is marginally cheaper). As for natural gas?
Well that is a hoot. I MMBtu in the US costs $3.56 today. I will not even bother with inflation but in 2006 it was $16. The fact is that at such a price production is now being shut in. It will have to increase to unlock reserves which, according to a report just out by Natural Gas Intelligence, will last 100 years. That, without any new discoveries at all, is enough to last the US around 100 years.
And so we need to piss away gazillions because the oil and gas is running out? Er no. Or because it is getting ever more expensive? Er no. Or because it causes global warming? Er… see my article published yesterday here.