Energy Crisis´ Impact On The Economy

Essay, 2009

7 Pages, Grade: Sehr gut


Energy Crisis´ Impact on the Economy

Did you know that the world consumes 40,000 gallons of oil per second? Because of that, oil production has reached its peak in 33 out of 48 countries.1 Today oil is a very important part of everyday life. For example, in the USA, the transportation sector is almost exclusively moved by energy made from oil.2 Oil is also the reason why we have the possibility to get bananas or melons in winter. Cargo ships make it happen that we can enjoy fruits or vegetables at any time of the year, when it is usually not possible to get these in our region. The big problem is that we run out of oil and gas. Experts say that oil will be finished in approximately 2050 and gas in about 2070. These facts have massive effects on oil prices. Oil and gas prices will increase sharply over the next few decades. The same applies to a lot of other items, which need oil for their production or their transportation. As a result everyone´s life will be influenced and will become more expensive.3 Today there are many alternatives to oil or gas. Renewable energies could replace them. This is the chance that our dependency on oil or gas will become reduced in the future. Therefore it is very important that the development of the renewable energies gets support and that it will evolve.4 All in all, the energy crisis has three main impacts on the economy, such as the increase of oil prices, financial downturns and it offers the opportunity to develop renewable energies.

Oil reserves are decreasing, which has the effect that the oil prices rise steadily. Currently, the world consumes 85 million barrels of oil per day in manufacturing and transport. For instance, 97 percent of the transportation sector (such as cars, subways, buses, railroads, ships and airplanes) in the USA is moved by energy made from oil.5 And demand for the black gold keeps rising. Oil underpins the global economy. This means that our everyday life will get more expensive and most of us have to learn to do without. And this would be the first step to get away from the addiction to oil.6 Because the production of some items will cost more and so the consumer has to pay more for the end product. Also food gets more expensive, especially this kind of food, which has to be transported from far away by trucks, cargo ships or airplanes.7 Therefore oil gives us mobility, but it also heats and cools our homes and it manage to create electricity. A lot of products, which are needed daily, are made from oil, such as plastics, clothing, life-saving medications, cosmetics, etc.8 The oil crisis will have significant effects on a lot of jobs which rely on oil. Nearly every job relies on oil even if some directly rely on oil and some indirectly. For that reason a lot of people will lose their jobs especially in some certain industries. However there are also other examples, like the automobile industry. This sector will experience many renewals. In the foreseeable future they have to change their usual style to manufacture cars. Thereby jobs such as gas station operator or car mechanic will change drastically.9 Ron Swenson is the publisher and editor of “The Coming Global Energy Crisis” website. Among others he said that at first it will become hard for people, who have only oil heating in their house or apartment. They have no other possibility than to pay the charged price for heating. Unless they could find an alternative to oil heating. Otherwise they are victims of their oil dependence. In addition the decreasing oil reserves will have a negative impact on oil prices.10


1 Kuhlman (2007)

2 SPE (2008a)

3 SPE (2008b)

4 Alliant (2007)

5 SPE (2008a)

6 Kirby (2004)

7 Joseph (2004b)

8 SPE (2008a)

9 SPE (2008c)

10 Swenson (2008a)

Excerpt out of 7 pages


Energy Crisis´ Impact On The Economy
University of Applied Sciences Vorarlberg
Sehr gut
Catalog Number
ISBN (eBook)
ISBN (Book)
File size
381 KB
energy, oil, crisis, economy, industry, renewable energy, solar, wind
Quote paper
BA Dominik Hauser (Author), 2009, Energy Crisis´ Impact On The Economy, Munich, GRIN Verlag,


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