Quantcast
Environmental News for a Healthier Planet and Life

Help Support EcoWatch

Oil Prices Drop As Global Warming Rises

Climate

With oil prices plunging from more than $100 a barrel last summer to below $50 now, the consequences of a petro-fuelled economy are hitting home—especially in Alberta, where experts forecast a recession. The province’s projected budget surplus has turned into a $500-million deficit on top of a $12-billion debt, with predicted revenue losses of $11 billion or more over the next three or four years if prices stay low or continue to drop as expected. Alberta’s government is talking about service reductions, public-sector wage and job cuts and even increased or new taxes on individuals. TD Bank says Canada as a whole can expect deficits over the next few years unless Ottawa takes money from its contingency fund.

As world leaders prepare for the UN climate summit later this year, we must look at the recent market meltdown as an opportunity to shift away from fossil fuels. Photo credit: Shutterstock

It’s absurd that a lower price on a single commodity could have such a profound economic impact, but that’s what happens when you put all your eggs in one basket and fail to plan for such contingencies. With a population and oil-and-gas production profile similar to Alberta, Europe’s largest petroleum producer, Norway, is also feeling the impacts. But much higher taxes on industry, majority state ownership of the country’s largest oil-and-gas company and an approximately $900-billion sovereign wealth fund built from oil revenues are cushioning the fall.

Some see low fuel prices as good news, but there are many downsides. With driving becoming less costly, more cars and trucks could be on the road, which is good for the auto industry but bad in terms of pollution, climate change and traffic accidents. And because the price of oil is now lower than the cost to extract oilsands bitumen, the industry is starting to put the brakes on rapid expansion plans—bad news for workers and businesses in Fort McMurray and those heavily invested in the industry but good news for the planet.

Recent research shows most of Canada’s oilsands bitumen—as well as all Arctic oil and gas, most of Canada’s coal and some conventional oil and gas—must be left in the ground if the world is to avoid a global temperature increase of more than 2 C above pre-industrial levels, the internationally agreed-upon threshold for limiting catastrophic impacts of global warming. The report, by researchers at University College London's Institute for Sustainable Resources and published in the journal Nature, concludes a third of the world’s oil reserves, half of gas reserves and more than 80 percent of coal reserves must not be burned before 2050.

The study also found that carbon capture and storage, touted as one way to continue exploiting and burning fossil fuels, is too new, expensive and limited to make enough of a difference by 2050.

Study co-author Paul Ekins told National Geographic that putting hundreds of billions of dollars into fossil fuel exploration and development is “deeply irrational” economic behaviour. “What would be ideal,” he said, would be to “use the opportunity of this fall in the oil price to start instituting a global carbon tax, which would take some of the volatility out of the prices.” Removing fossil fuel subsidies would also help.

John Stone, a Canadian scientist and lead author on the most recent Intergovernmental Panel on Climate Change report, told CBC the UCL study “is another wake-up call to snap us out of our denial of climate change.

With 2014 confirmed as the hottest year on record, and 13 of the hottest 15 years having occurred since 2000, we can’t afford to ignore the consequences. According to researchers, the odds that natural variability is causing today’s climate change are less than one in 27 million! It’s astounding that, in the face of such overwhelming evidence from scientists worldwide, people continue to deny the problem exists or that humans are responsible and can or should do anything about it.

It’s especially irresponsible when energy conservation and cleaner fuel alternatives offer so many economic benefits, including job creation, greater stability and reduced health-care costs. As world leaders prepare for the UN climate summit later this year, we must look at the recent market meltdown as an opportunity to shift away from fossil fuels. It’ll be much easier and less costly to get on with it now than to wait until we’re left with few choices.

YOU MIGHT ALSO LIKE

UN Climate Chief: Carbon Bubble Is Now a Reality

10 Most Important Things We Can Do to Change the Food System

We Need to Talk

EcoWatch Daily Newsletter

Marco Bottigelli / Moment / Getty Images

By James Shulmeister

Climate Explained is a collaboration between The Conversation, Stuff and the New Zealand Science Media Centre to answer your questions about climate change.

If you have a question you'd like an expert to answer, please send it to climate.change@stuff.co.nz

Read More Show Less
Luxy Images / Getty Images

By Jo Harper

Investment in U.S. offshore wind projects are set to hit $78 billion (€69 billion) this decade, in contrast with an estimated $82 billion for U.S. offshore oil and gasoline projects, Wood Mackenzie data shows. This would be a remarkable feat only four years after the first offshore wind plant — the 30 megawatt (MW) Block Island Wind Farm off the coast of Rhode Island — started operating in U.S. waters.

Read More Show Less
Giacomo Berardi / Unsplash

The COVID-19 pandemic has revealed both the strengths and limitations of globalization. The crisis has made people aware of how industrialized food production can be, and just how far food can travel to get to the local supermarket. There are many benefits to this system, including low prices for consumers and larger, even global, markets for producers. But there are also costs — to the environment, workers, small farmers and to a region or individual nation's food security.

Read More Show Less
Pexels

By Joe Leech

The human body comprises around 60% water.

It's commonly recommended that you drink eight 8-ounce (237-mL) glasses of water per day (the 8×8 rule).

Read More Show Less

By Michael Svoboda

The enduring pandemic will make conventional forms of travel difficult if not impossible this summer. As a result, many will consider virtual alternatives for their vacations, including one of the oldest forms of virtual reality – books.

Read More Show Less
Public Employees for Environmental Responsibility on Thursday accused NOAA of ignoring its own scientists' findings about the endangerment of the North Atlantic right whale. Lauren Packard / Flickr / CC BY 2.0

By Julia Conley

As the North Atlantic right whale was placed on the International Union for Conservation of Nature's list of critically endangered species Thursday, environmental protection groups accusing the U.S. government of bowing to fishing and fossil fuel industry pressure to downplay the threat and failing to enact common-sense restrictions to protect the animals.

Read More Show Less

Trending

Pexels

By Beth Ann Mayer

Since even moderate-intensity workouts offer a slew of benefits, walking is a good choice for people looking to stay healthy.

Read More Show Less