Cheap Oil Derails Paris Climate Summit

cop21-paris

These are dark, dark days indeed for those profiting from green rackets. Guido wrote about how Government cuts to renewables funding were imperiling the subsidy reliant industry in the UK. The rapidly sliding oil price might just derail the Paris Climate Summit’s key aim to reduce emissions by scaling back reliance on fossil fuels. Such plans look unlikely to come to fruition in an era of super cheap oil…

The price of Brent crude has now fallen to a 12 year low below $30 a barrel as a result of sanctions being lifted on Iran, adding to an already present glut in oil production from OPEC members and US shale drillers. In such a climate consumers might be expected to increase consumption, with even figures from the climate lobby admitting such. Richard Howard, the environment and energy wonk at Policy Exchange, concedes:

“All else being equal, economic theory would suggest that the falling price of oil and gas would lead to an increase in consumption of oil and gas, with people driving their cars further, and heating their homes more. This could increase, or slow down the fall, in greenhouse gas emissions”.

To add insult to injury such a low oil price will only further encourage Government’s to withdraw subsidies from renewable energy, an industry wholly dependent on them. Perhaps the only hope for the climate lobby is that the price of oil will bounce back, otherwise known as the Alex Salmond school of thought. Unfortunately for them, it looks like we could be in for a prolonged period of cheap oil. So it’s really not looking good for the anti-fossil fuels, pro-renewables crowd then…




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