It is normal that petroleum productions or oil products pass through ups and downs since oil is considered a finite fuel. The world now has faced a big challenge regarding oil which is called “Peak oil”. According to Leder and Shapiro (2008),“ prices are likely to continue their upwards trend as production of conventional oil reaches a worldwide peak and then goes into a period of permanent decline, a condition known as peak oil”( Leder, Shapiro, 2008).
It is believed that peak oil is a current problem in many countries, such as the United States, Saudi Arabia and the UK. Although in these countries oil productions have increased over the years, their sources of oil have passed through decreasing periods which has led those countries to figure out the main causes and to find the solutions for this dilemma. India and China are countries that mostly rely on oil as a source of energy and their need for oil has increased over the years.
The recognition of the importance of oil has increased in the United States since it relies on oil in their transportation, health and industries. Therefore, decreasing oil production affects things that have been mentioned above. The other challenge is the price of oil. In other words, any increase in oil`s price decreases the cost of other things, such as food and affects the economy of the county. According to Leder and Shapiro (2008), “peak oil creates a situation where world oil production is decline, demand increasing and prices rising” (Leder, Shapiro, 2008).
Therefore, governments should be able to finds alternative fuels to rely on instead of oil only, such as solar energy, coal and electric power. In addition to that, they should be able to make a great investment in oil in order to use it in a time of need. Indeed, it is believed that all the challenge that the world faces about oil will be solved when all governments take practical steps toward saving oil and using it in important things.
Reference:
Leder, F. & Shapiro, N., J. (2008). This Time it`s different : An inevitable decline in world petroleum
production will keep oil product prices high, causing military conflicts and shifting wealth
and power from democracies to authoritarian regimes, 36(8), 2850-2852.
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