cross-posted from : https://futurology.today/post/8980779
The Straits of Hormuz, through which 20% of global fossil fuels supply needs to flow, are closed; perhaps for months. It’s not just gasoline prices that are about to sharply rise. LNG supplies are just as affected. In many places, notably Europe, this will sharply increase electricity prices. Renewables and EVs were booming before; now they’ll have even more advantages. It’s not just that they’ll be cheaper; they’ll also come to be seen as a hedge against global instability and conflict.
China, the major global producer of solar/batteries/EVs, will have even more incentive to abandon fossil fuels. The rest of the world will have even more incentive to buy from them.
There’s still a contingent of people who think renewables/EVs are ‘woke’ or for ‘do-gooders’; they’re about to get a practical lesson in economics and cold hard cash, when they see other people paying a fraction of what they are to power their cars and homes.
Higher oil prices due to a global carbon tax would be an incentive to move away from fossil fuels. Higher oil prices due to war is just a gift to every petrostate that isn’t directly hit by the war, and is great news for Vladimir Putin and American oil companies. The higher prices, should they persist, will be taken as a market signal to expand production even more. I can already picture Mark Carney and his friends gloating about how Canadian oil and gas exports are even more profitable now.
For now, but it still changes the cost calculus when planning future energy projects. Countries that get burned on the costs today will want to prevent that in the future.
We’ll see what happens when the price gets up to $100 or whatever makes them start talking about “demand destruction” again. For now, on CBC radio news this morning, they’re already spinning it as a reason to build more oil pipelines in Canada.
I bet all the countries that are all in on electrification are feeling so fucking smug right now, rightfully so
