Roll on $200 a barrel oil prices

Much as I hate what Gaddafi is up to and much as I dread any threat to the stability of the Saudi regime, I can’t help hoping that the oil price goes up and stays up.

There are a lot of reasons for this.

Cheap oil is what drives industrial farming. 7 years ago in The Little Food Book I calculated that when the oil price hit $70 a barrel organic food would be cheaper than non-organic. That’s because it take twice as much fossil fuel for an industrial farmer to produce a calorie of food as it does for an organic farmer. Broadly speaking, an industrial farmer uses 12 calories of fossil fuel to produce one calorie of food. Then it takes more fossil fuel to convey the food to the supermarket distribution depot, then to the store, including refrigeration costs. An organic farmer uses 6 calories of fossil fuel to produce one calorie of food and is more likely to sell it at a farmer’s market or to local outlets.

Industrial farming replaces jobs with chemicals. Instead of people planting, weeding and composting chemicals do the job. Nitrate fertilisers are made using natural gas. Gas prices follow oil prices upwards – energy is energy. So nitrates are getting a lot more expensive, but still not expensive enough. They’re killing us by releasing nitrous oxide into the atmosphere, a greenhouse gas 310 times more harmful than carbon dioxide in causing global warming. Nitrates are responsible for the equivalent of 1 billion tonnes of CO2 every year, about 1/6 of the total excess emissions that are turning up the heat on dear old Planet Earth. And farmers need to use more and more as underlying soil fertility dies out, making a bad problem worse. At $200 barrel, even with the current extravagant level of subsidies, farmers would switch to organic in droves. If you can grow your own fertiliser by leaving fields fallow, composting and growing green manures, why pay for a bunch of horrendously expensive chemicals? The price of food will go up as the price of oil goes up, but the impact per calorie on organic food will be half that on industrial.

A lacto-ovo vegetarian consumes half the energy resources for the same nutrition as a non-vegetarian meat-eater. A vegan consumes just one quarter. An organic vegan will consume just 1/8 the fossil fuel inputs of a non-organic non-vegetarian.

The price of carbon offsets goes up with rising oil prices. Companies have to pay for EU carbon emission allowances. They are currently priced at around £12 per tonne. Sir Nicholas Stern, author of the last government’s report on climate change and of the book Blueprint for a Safer Planet, said the real price should be £70 per tonne. (Then he said “I was wrong – the real figure is £140 per tonne”). The higher the price of oil, the higher the price of carbon offsets and the more attractive it is to invest in energy-saving and renewables. A tonne of oil produces more than 3 tonnes of carbon dioxide, so just to offset the cost to the future of this planet, it should cost £140 times 3 or £420. A barrel is 1/5 tonne, so the carbon cost of a barrel should be priced in at about £80, or $120 per barrel. Then the producers need to make a small profit, too, after all it costs anything from $3 (Kuwait) to $9 (Texas) to extract a barrel of oil from the ground. They’ve got used to making $90/barrel profit, add that to the $120 carbon cost and you’re over $200.

When you see the taxis with their engines running queuing up outside railway stations, vans parked with their engines running and people whizzing along at inefficient speeds you can’t help wondering if they would be so wasteful if petrol cost 3 times as much.

Think of the jobs that high oil prices would bring, too. Every time an out of town supermarket opens local employment suffers. Yeah, yeah, I know they claim they are creating jobs but James Lowman of the Association of Convenience Stores did a check last year. Supermarkets created an extra 2.75 million extra square feet of store space and cut their staff levels by 426. So we are gutting the high streets of our towns and putting more people on the unemployment register and forcing people to drive to the supermarket to buy a week’s worth of food, 1/3 of which goes off and ends up being wasted.

When oil prices go up people will shop locally, on an ‘as needed’ basis. They’ll eat organic. They’ll eat less meat. They’ll walk more and drive less. They’ll pay lower insurance premiums as adverse climate events reduce the impact on insurers. They’ll breathe cleaner air as people switch to less polluting transportation. They’ll drink cleaner water as pesticides and

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s