General Motors CEO: oil has peaked

The world's biggest car maker, General Motors, believes the global oil supply has peaked and a switch to electric cars is inevitable. In a stunning announcement at the opening of the Detroit Motor Show yesterday [14 Jan 2008], GM's chairman and chief executive officer, Rick Wagoner, said ethanol was an important interim solution to the demand for oil, until battery technology gave electric cars the range of petrol-powered cars. GM is working on an electric car, the Volt - due in showrooms in 2010 - but delays in battery technology have slowed its development.

Mr Wagoner cited US Department of Energy figures that showed the world was using about 1000 barrels of oil every second and demand was likely to increase by 70% in the next 20 years. "There is no doubt demand for oil is outpacing supply at a rapid pace, and has been for some time now," Mr Wagoner said. "As a business necessity and an obligation to society we need to develop alternate sources of propulsion. So, are electrically driven vehicles the answer for the mid- and long-term? Yes, for sure. But we need something else to significantly reduce our reliance on petroleum in the interim."

Most recently, ethanol has fallen out of favour with scientists and sustainability experts who have found that processing grain-based ethanol is not much more energy-efficient than refining crude oil. There is also a catch in GM's grand vision. Ethanol is about 30% less efficient than petrol (gasoline). Last year, a Sydney test found a car on a mix of 85% ethanol and 15% unleaded petrol travelled half the distance that a car on regular unleaded would.

- A fascinating admission from the head of a car-maker responsible for gas-guzzling vehicles like the Hummer and its brethren of SUV's and trucks. But their push for ethanol vehicles is troubling - it continues to promote the "starve the people to feed the cars" agenda.

Perhaps I might as well ride the trend and buy some agricultural stocks or ETF's to cover my rising grocery bills. It would be even better if I could find some income funds in that area, like my energy income trusts that are paying me monthly dividends that have been helping to cover the rise in my petrol bills.

(2008-01-17 19:46:36 SGT) [Energy] Permalink

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