Energy Choices Studied as Oil Prices Rise September 2004

Sport utilities could be abandoned for smaller, more fuel-efficient cars.

WASHINGTON - Enough oil is available to keep cars whooshing down highways for at least another century, but the price of gasoline will continue climbing well above $2 a gallon in decades ahead.

As a result, energy-hungry America faces subtle and not-so-subtle changes in coming years as extracting oil becomes more expensive, say petroleum industry analysts and futurists who make technological and societal predictions:

-- Within 20 years, most Americans could abandon gas-guzzling sport utility vehicles in favor of smaller, fuel-efficient cars or gas-electric hybrids such as the Ford Escape, Toyota Prius and Honda Insight that can get about 50 miles to the gallon or more.

-- By the end of the 21st century, working from home via computer could become the norm because of the cost of commuting. About 30 million workers telecommute at least part of the week.

-- Exotic ways to provide energy such as orbital solar power collectors and miniature boutique nuclear reactors that can power a single town will emerge.

"This energy situation will be with us to stay," Hunter Herron, founder of Petroleum Equities consulting company, said of today's rising oil prices. "The American consumer will become more Western European-oriented - smaller cars and more mass transportation."

Global demand for oil to generate electrical power, heat homes and run planes, trains and automobiles is at a record high.

By next year, worldwide consumption of oil products such as gasoline is expected to hit 84 million barrels a day, up from 60 million two decades ago, according to the Department of Energy.

Oil demand will grow even more as consumers in India and China - two emerging economic powerhouses - adopt America's penchant for energy-hungry cars, appliances and electronics, analysts said.

Some Americans who worry about energy availability in the future and the damaging effects of fossil-fuel burning on the environment are making a change.

Henry Drygas, 56, a doctor from Olympia, Wash., flew 600 miles to pick up a $28,000 silver Toyota Prius in Helena, Mont., instead of waiting months for a local dealer to deliver it.

The hybrid that runs on gasoline and electricity gets 45 miles or more to a gallon of gas, easily twice the mileage of many SUVs. Toyota is boosting Prius production but has a monthslong waiting list to buy the fuel-sipping car.

Despite renewed interest in gas-saving automobiles, oil is still plentiful, said John Felmy, an economist at the American Petroleum Institute.

Companies know about 1.2 trillion barrels of oil underground around the world that could be tapped easily, Felmy said.

Enough additional oil is locked in tar sand and shale under Canada and the United States to supply those two countries for the next 125 years, Herron said.

But a lot of oil does not equal inexpensive gasoline. Getting oil out of shale buried deep in mountains or from a well almost 2 miles under the sea is expensive and could damage the environment, experts said.

SOURCE: Auto Insider

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