West Should Consider Ramifications of its Off-oil Rhetoric

Environmental and political enthusiasm in the West for getting rid of oil as an energy source may have major unintended consequences through its impact on decisions by a handful of key oil exporters. Such consequences could paradoxically include increased Western dependence on oil and higher energy prices.An energy crisis is imminent if oil-exporting countries believe Western rhetoric and decide to reduce their investment in capacity expansions at a time when the West is failing to find a suitable substitute. In this case, consumers will pay a dear price for the ill-considered statements of their leaders.If, by contrast, oil producers attempt to counter a policy-induced decline in demand …