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THE OIL CRUNCH – A WAKE-UP CALL FOR THE UK ECONOMY

Industry Taskforce on Peak Oil & Energy Security

 

«Our message to government and businesses is clear. Act now.»

http://peakoiltaskforce.net/wp-content/uploads/2010/02/final-report-uk-itpoes_report_the-oil-crunch_feb20101.pdf

 

The credit crunch of 2008 foreshadowed major economic, political and social upheaval. It stress tested the responses of governments, policy-makers and businesses to the extreme. If only there had been greater time to prepare for its impact and a greater level of understanding about the issues.

The next five years will see us face another crunch – the oil crunch. This time, we do have the chance to prepare. The challenge is to use that time well.

As we reach maximum oil extraction rates, the era of cheap oil is behind us. We must plan for a world in which oil prices are likely to be both higher and more volatile and where oil price shocks have the potential to destabilise economic, political and social activity.

Virtually every sector of our economy is still dependent on oil. This is why it is vital that whichever party forms the next government, they have a coherent set of policies to help the UK adapt.
This is especially important for the UK, and other developed economies, which have been so reliant on low-cost oil for decades.

There are two challenges for government and policy-makers.
Firstly, to recognise the situation we face, and secondly to take action to mitigate the worst implications of the crunch.
Unless we do so, we face a situation during the term of the next government where fuel price unrest could lead to shortages in consumer products and the UK’s energy security will be significantly compromised. This has the potential to hit UK business and commerce as well as the most disadvantaged in society with yet another crisis.

While responsibility for addressing these changes must be taken up by government, we must also build a coalition of interests including businesses and the public if we are to implement the changes needed to help us adapt and survive.

«Our message to government and businesses is clear. Act now.»
Richard Branson, Founder, Virgin Group Ian Marchant, CEO, Scottish & Southern Energy