Big Oil haters might be pleasantly surprised to learn in the latest Fortune magazine that Dutch engineer Harry Brekelmans, the chief strategist for Royal Dutch Shell, enjoys talking about biofuels and other alternative energy sources.
But Brekelmans doesn’t go along with the peak oil myth:
People talk about peak oil in the sense of supply. But I think of Sheikh Yamani’s classic quote, “The Stone Age didn’t end because we ran out of stone.” People simply moved on to different and better things. The same will happen with fossil fuels. It’s very important to realize that we’ll be moving on to alternatives before we run out of oil and gas.
The year 2040 is not necessarily the demand peak either. The interaction between supply and demand will govern at what point — 2030, 2040, 2050 — we really see the peak. But rest assured, I think there will be gas and oil left by the time we’ve moved on to those alternatives.
This is a critical point. One day, we will be using alternatives to oil. No one disputes this notion.
The timing of that move should depend on market forces. When the cost of alternative sources compares favorably to oil, people will move to those alternatives on their own.
The government hinders that process — hurting energy consumers along the way — by placing restrictions on oil supply, thus driving up its cost, and using taxpayer dollars to subsidize the alternatives, thus driving down their price (but not their cost).
