Fueling the falcon. When does it become too much?

[4.9 EF Futura]

You're all assuming that by the time petrol hits $4/L - there's going to be enough of it around to sell to motorists!

Fair enough the demand in China and India won't drop off straight away, but it won't last forever either.

Wanna bet? China are currently using a fraction of what the US destroys per annum, but are tipped to surpas this consumption by 2020. Remembering that US consumption continues to grow - its a fair effort to catch up and overtake this level of demand.

I bet people were thinking fuel prices would always be high back in 1973 and 1980, but they dropped off again. Besides, it's still cheaper now than in 1980

These were the result of artificial shocks to supply - i.e. embargos imposed by OPEC. We're looking at a genuine equilibrium at this price - as opposed to a falsified equilibrium as a result of oil embargos.

Chalk and cheese.

Frankly i think its these attitudes - the "it'll work itself out" approach - that will be our downfall. 22 million australians with their heads buried in the sand, waiting for "someone else" to "fix" the problem.

Alternative fuels just make the problem worse.

a) Jevons paradox. The more you reduce your consumtpion of oil - the quicker someone else burns it.
b) The amount of fossil fuel energy that goes into producing alternative fuels. Currently 1 "unit" of ethanol/biodiesel consumes 6 "units" of energy to produce it