Crude is king and it will put up quite the fight before it relinquishes its stronghold as the primary power source of the world. Rumors about the future of oil are often surrounded by talk of green energies such as wind and solar. As technology continues to progress at compounding rates, the world speeds ever-closer to alternative energies.
The End of a Dynasty
Should renewable energies become more cost efficient and usable on a massive scale, then crude’s reign may come to an end. There won’t be a sudden drop in crude commodity prices because the transition from crude to green energies will take years to establish the infrastructure and produce on a large scale. The production and support systems are simply not there yet for it to dethrone crude oil, and the current markets for solar and renewable energies are very thin or non-existent, which makes it difficult to trade in. Before crude declines, a few dominoes need to fall to clear the path for a takeover.
How to Dethrone a King
In order for renewables to replace crude oil as a primary source of energy, a number of things must occur: renewables need to be economically feasible on a massive scale; demand needs to increase; the private sector needs to take the reins and drive it forward without impediment from politics; and entire economies will have to shift their economic models. A good portion of solar companies that the Obama administration was funding have had trouble succeeding, and this doesn’t appear to be a major focus in the Trump administration. This means the private sector and capitalism must advance the technologies before it is adopted. The process will take a long time and the transition will be slow in a healthy market.
The Next Ruler in Line
The world wants an alternative energy source to crude oil, and a primary driving factor of this shift to a new energy is environmentally fueled. Perhaps the current clean energies – such as solar and wind – aren’t the answer. Humanity might secure a sustainable future through alternative energies like clean burning coal, or even an undeveloped technology that removes excess carbon from the atmosphere. These options might be easier to reach, economically, simply because entire countries won’t have to undergo a fundamental reconstruction.
The current energy and corresponding economic infrastructures will be replaced at some point in the future. However, the process will be long term and potentially decades down the road. Developed nations will need to take the lead as many countries that depend on oil will provide great resistance to adopting an alternative energy. Renewables will come into play as a big impact on crude at some point way down the road, but for now, crude remains comfortable at the top.