<Oil Price PollThe Oil DrumDrumBeat: July 10, 2006>
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46 comments on UK Energy Trends, Coal

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MetaMeme on July 9, 2006 - 7:20am Permalink | Subthread | Parent | Comments top
More generally, if many Western countries start having to import huge volumes of gas & oil, what will that do to the world economy?

Will the suppliers get richer and richer, whilst shipping smaller & smaller volumes, to fewer & fewer countries?

Which will be the last countries to face economic collapse?

I assume the countries to survive will be those that make things, or provide services, that the supplier countries want.

Japan and Germany spring to mind - both make expensive, very high tech goods.

I'm not sure about China - does it export much to the oil & gas producers?

The UK of course is stuffed - our service industries are slowly fading and we don't make much.

Perhaps we should buddy up with another military power, and simply go and grab some oil? Nah, couldn't happen.

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zceb90 on July 9, 2006 - 8:15am Permalink | Subthread | Parent | Comments top
EU countries such as France and Germany are used to importing the majority of their oil and gas supplies; they have very limited indigenous supplies.  Oil and gas imports for UK will cause somewhat of an economic shock as UK has been lulled into a (soon to be false) sense of security by several decades of cheap NS supply.

All EU oil / gas importing nations will be impacted by ongoing price rises but UK especially so given that our manufacturing base has been extensively eroded and UK also runs a large deficit in tourist trade.  My own view is that UK will be using less oil and gas by 2020 - consumers won't like it but in the absence of a big manufacturing revival UK plc won't be able to afford imports on a scale in line with current DTI / Gov't demand growth forecasts or anywhere near it.

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tommy on July 10, 2006 - 2:21am Permalink | Subthread | Parent | Comments top
You have to understand that the extra money payed for gas is not lost! The money has gone somewhere else, but it isn't lost!

This means that the people who get the money (the oil exporters) can (and will) spend it back into the U.K. economy (or buy bonds). If they don't the pound would not keep its value (a lot of people would not allow this to happen). So this means that the money comes back into the U.K. either way!

Only if extracting the oil requires more manual labor (more people to extract a barrel) the economy will be hurt! But since you hear every company screaming that they can not find qualified people I think that the increase in people working in the oil sector is relatively limmited (any data on this?)

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LevinK on July 10, 2006 - 10:28am Permalink | Subthread | Parent | Comments top
Oil is traded in dollars, meaning that most of this money is crediting the US economy.

Absent revival of the UK export, more expensive oil will put downward pressure on the US pound (and on the US dollar BTW) which would mean more expensive imports leading to lower living standart.

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ashaddock on July 10, 2006 - 10:20am Permalink | Subthread | Parent | Comments top
"I'm not sure about China - does it export much to the oil & gas producers?"

I seem to recall reading that China built a subway system in Teheran and has built rail and other infrastructure in several African countries.

It seems to me that China is and will be very well positioned to offer a wide range of competitive goods and services to oil exporters.

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