Risk Premium, and Peak Oil

Over the last year or so, the Telegraph Journal has regularly published the columns of Roy MacMullin, a Moncton-based energy writer and peak-oil disciple.

While his columns are interesting enough, they fail to convince this reader how a new world of very expensive oil barrels will fundamentally change public policy in New Brunswick (even if this economic fact probably should). Apparently, this economic fact haven't caused much concern over at Irving Oil either, as plans for Eider Rock keep lurching forward.

My beef with peak oil? It focuses too much on geology, when the real issues policy-makers need to concern themselves with are over the environment and foreign affairs. While climate change gets most of the attention, the really smart analysis seems to focus on where more and more of our expensive oil comes from. Not surprisingly, NYT columnists and others are identifying petro-dictatorships as a key catalyst behind high summer gas prices.

A fantastic article in Texas Monthly puts a very human face behind the worsening oil economy, in the form of the story of a kidnapped oil worker in the petro-rich troubled Nigerian delta. No need for a geologist to explain tapped reserves here - as long as this oil-producer (and others) is torn by civil strife, that summer trip to Freeport is going to be more expensive, and millions of residents in petro-dictatorships will continue to suffer.

Wouldn't it be nice if New Brunswickers could pay a premium for fair-trade oil, like they do for their coffee? I know I'd feel better coughing up $70 at the pump, if I knew that the gasoline that was refined here in Saint John came from oil regions in which children could walk into their neighbourhood woods without coming across guerillas with automatic rifles.