Professional Documents
Culture Documents
R&B Index
(Renewables and Backstopping)
R&B Shell (1/3)..............................................................................................................................................................3
***Renewables DA***...................................................................................................................................................6
Renewables 1NC Shell....................................................................................................................................................7
High Oil Prices Solve Warming Now.............................................................................................................................8
High Oil Prices Renewable Shift in the SQ (1/3)......................................................................................................9
Global shift to Renewables now...................................................................................................................................12
Renewable Shift Underway (1/6)..................................................................................................................................13
EU = Renewables now..................................................................................................................................................19
Renewables Brink.........................................................................................................................................................20
Businesses Going Green...............................................................................................................................................21
Businesses Going Green – High Oil Prices..................................................................................................................22
Businesses Going Green – Public Pressure...................................................................................................................23
Policy changes reduce the price of oil...........................................................................................................................24
US consumption key to global oil market.....................................................................................................................25
AE switch causes Oil Prices to drop (1/3)....................................................................................................................26
Cheap Oil halts Renewable Transition (1/3).................................................................................................................29
Cheap Oil boosts Consumption and Warming (1/2).....................................................................................................32
SUV/Trucks Add-on.....................................................................................................................................................34
Oil prices declines = war...............................................................................................................................................35
***Backstopping DA***..............................................................................................................................................36
Backstopping 1NC Shell (1/2)......................................................................................................................................37
Oil Prices are Stable (1/2).............................................................................................................................................39
Natural Gas Prices High Now.......................................................................................................................................41
A2: Renewables in the SQ should cause the DA..........................................................................................................42
Boosting Alternative Energy causes Backstopping (1/3)..............................................................................................43
Saudis will flood the market if Oil Prices drop.............................................................................................................46
Multiplier: Saudi capacity would devastate the market................................................................................................47
Saudis are watching alternative energy closely to enforce prices.................................................................................48
OPEC has Spare Capacity (1/4)....................................................................................................................................49
Saudis have Spare Capacity (1/2).................................................................................................................................53
Oil production can pace demand...................................................................................................................................55
OPEC perceives biofuel investment.............................................................................................................................56
Backstopping Crushes Renewables (1/2)......................................................................................................................57
Perceived Backstopping Causes Oil Price Drop (1/2)..................................................................................................59
Backstopping will lower Oil Prices..............................................................................................................................61
Cheap Oil increases Consumption (1/3).......................................................................................................................62
A2: OPEC can’t flood the market – they’ll create the perception................................................................................65
***Renewables DA Answers***..................................................................................................................................66
No transition to Renewables now (1/2).........................................................................................................................67
SQ Renewables DO NOT solve the case......................................................................................................................71
SQ Biofuels investments are way small/slow...............................................................................................................72
No Price Drop – Chinese Demand will fill in (1/5)......................................................................................................73
No Price Drop – China/India Demand will fill in (1/4)................................................................................................78
No Price Drop – General Fill In (1/2)...........................................................................................................................82
Alternative Incentives don’t reduce Oil Prices.............................................................................................................84
Price Drop doesn’t Crush Renewables..........................................................................................................................85
Turn – Alternatives Increase Energy Prices..................................................................................................................86
A2: If you solve, you link.............................................................................................................................................87
***Backstopping DA Answers***...............................................................................................................................88
High Oil Prices Inevitable (1/2)....................................................................................................................................89
Oil Price Swings Now (1/4)..........................................................................................................................................91
No Backstopping – Production Bottlenecks (1/4).........................................................................................................95
A2: Backstopping – Oil Prices will stay high...............................................................................................................99
TURN: OPEC will cut production and increase prices...............................................................................................100
Gonzaga Debate Institute 2008 2
Lacy/Symonds/Bowen R&B (Oil)
A2: Renewables increase Oil capacity........................................................................................................................101
OPEC can’t flood the market – No spare capacity (1/7).............................................................................................102
Saudi Arabia can’t flood the market – no spare capacity (1/3)...................................................................................109
Saudi Arabia can’t flood the market – Production problems......................................................................................112
Saudi Arabia will only slightly increase production...................................................................................................113
Saudi Arabia won’t flood the market..........................................................................................................................114
Non-OPEC countries running out of capacity............................................................................................................115
OPEC won’t flood the market (1/3)............................................................................................................................116
OPEC can’t reduce Oil Prices (1/4)............................................................................................................................119
Crunch inevitable – OPEC can’t meet demand...........................................................................................................123
Gonzaga Debate Institute 2008 3
Lacy/Symonds/Bowen R&B (Oil)
D. Turns the Case – Only sustained high oil prices can guarantee a smooth transition to
renewables
Bryce managing editor of Energy Tribune. He is the author of Cronies: Oil, the Bushes, and the Rise of Texas,
America's Superstate ‘07
Robert, Petroleum World “The Politics of Cheap Oil” 1/28/07 http://www.petroleumworld.com/SF07012801.htm
Accessed: 7/3/08
Cheap crude will short-circuit the push for renewable energy. We've seen this before. The surge in oil
prices that occurred after the 1973 oil embargo didn't last. As prices softened, so, too, did the interest
in solar power, wind power and other technologies. The best hope for the renewable energy sector is a
sustained period of high prices for fossil fuels of all types, from coal to natural gas.
Gonzaga Debate Institute 2008 5
Lacy/Symonds/Bowen R&B (Oil)
***Renewables DA***
Gonzaga Debate Institute 2008 7
Lacy/Symonds/Bowen R&B (Oil)
C. Turns the Case – Only sustained high oil prices can guarantee a smooth transition to
renewables
Bryce managing editor of Energy Tribune. He is the author of Cronies: Oil, the Bushes, and the Rise of Texas,
America's Superstate ‘07
Robert, Petroleum World “The Politics of Cheap Oil” 1/28/07 http://www.petroleumworld.com/SF07012801.htm
Accessed: 7/3/08
Cheap crude will short-circuit the push for renewable energy. We've seen this before. The surge in oil
prices that occurred after the 1973 oil embargo didn't last. As prices softened, so, too, did the interest
in solar power, wind power and other technologies. The best hope for the renewable energy sector is a
sustained period of high prices for fossil fuels of all types, from coal to natural gas.
Interest in alternative energy on the rise in the US and internationally due to high oil
prices.
Baue, Staff Writer, 05
(William, Social funds, “Rising Oil Prices Fuel Investment Returns in Renewable Energy for New Alternatives
Fund,” 10/14, http://www.socialfunds.com/news/article.cgi/1834.html, date accessed: 7/2/08)
The first environmental mutual fund is also globalizing its reach to capitalize on innovative
developments in alternative energies in other countries. SocialFunds.com -- Rising fossil fuel prices are
sparking interest in renewable energies and activity in alternative energy is globalizing. This
combination is powering strong investment returns for the New Alternatives Fund (ticker: NALFX). Founded
by father-and-son team Maurice and David Schoenwald in September 1982 as the seminal environmental
mutual fund, the fund been on a hot streak lately with one-year returns of 21.54 percent. These results place
the fund in the ninth percentile compared to peer funds of similar style and asset class as well as other
attributes--including both those in the socially responsible investing (SRI) realm with New Alternatives and
those in the mainstream. In other words, New Alternatives has outperformed 91 percent of like funds over the
past year. Looking at the longer term, the fund's three-year annualized returns stand at 18.18 percent, placing
it in the 29th percentile. All fund statistics cited in this article are based on data provided to SocialFunds.com
by Thomson Financial Network covering the period ending September 30, 2005. "There certainly has been
increased interest in alternate energy in the US, but I think the interest is greater overseas and has
been for a number of years," David Schoenwald told SocialFunds.com. "I'm sure the higher oil and
natural gas prices have contributed to the investment interest and stock performance in alternative
energy."
Gonzaga Debate Institute 2008 11
Lacy/Symonds/Bowen R&B (Oil)
Multiple key states are already using incentives to shift towards renewable energy
PEMBINA Institute, not-for-profit environmental policy research and education organization specializing
in the fields of sustainable energy ‘08
“Supportive Policy” Last date cited: March 18th 2008. http://re.pembina.org/global/support Accessed: 7/2/08
Substantial policy mechanisms to support green power for electricity generation are in place in Brazil,
China, Denmark, France, Germany, India, Japan, Ontario, Portugal, Spain, Sweden, Korea, the United
States and the United Kingdom. Feed-In Tariffs
Renewable energy feed-in tariffs, also known as advanced renewable tariffs or standard offer contracts, are
used by most countries that successfully support green power. Feed-in tariffs allow for green power
generators to sell power to the grid operator at premium fees set by government. The fees are usually
set at different rates for different technologies. For example, Germany has different feed-in tariffs for
hydropower, wind, solar, geothermal and biomass projects. If it becomes apparent that one technology is not
being developed at a rate necessary to meet targets, the fees can be adjusted. The grid operators are legally
required to give priority connections to plants generating electricity from low-impact renewable energy
sources. The highest feed in tariffs have been set by Korea at 70 cents/kWh for solar electric power. Ontario
has recently introduced a standard offer contract for wind, biomass and solar green power sources.
The use of the feed-in tariff approach can be used to support the development of a well-balanced green
power portfolio. If it includes long-term commitments with fair pricing, this approach can provide a
stable investment environment and lead to the establishment of local green power manufacturing
facilities. It can also result in a diverse ownership structure for green power involving farmers and
municipalities, which leads to more rural and economic development.
Renewable Portfolio Standard (RPS)
Another successful approach is to allow grid operators to use their own means to meet legal green power
targets or a Renewable Portfolio Standard (RPS). The state of Texas in the U.S. has become a leader in
using the RPS approach. At the end of 2005, Texas had an installed wind generation capacity of 1,995
MW. As of 2006, a total of 21 U.S. states have RPS regulations . Several members of the European
Union have RPS or Renewable Obligations including the United Kingdom and France.
An RPS sets an escalating set of green power goals and places responsibility for meeting those goals on the
electric retailers, with significant penalties for non-compliance. An RPS is often supported by renewable
energy certificate (REC) trading that allows utilities with legal commitments to purchase green power from
third parties if it is cheaper to do so. Because of the focus on low-cost green power, the RPS approach has
been most successful in stimulating wind power development. To support other green power resources, an
RPS has to assign distinct targets for each green power source.
Financial Incentives
Several countries including Canada and the United States provide production incentives for wind
generated green power. These are paid to the producer of green power on the basis of each kWh of power
generated.
Green power generating equipment and systems often qualifies for accelerated depreciation under tax
laws making investment in green power more financially attractive.
Gonzaga Debate Institute 2008 13
Lacy/Symonds/Bowen R&B (Oil)
EU = Renewables now
France, Japan, Finland, and the UK all produce nearly all of their power by alternative
sources
Loris is a Research Assistant and Spencer is a research fellow in the Thomas A. Roe Institute for Economic
Policy Studies at The Heritage Foundation, 08 (Nicolas and Jack, Front Page Magazine, July 8, “Nuclear Energy:
What we can learn from other nations”, http://frontpagemagazine.com/Articles/Read.aspx?GUID=7048A616-
ECFB-49E9-86FC-D2EF8F0226D2, 7/11/08)
France is an example of a country that developed nuclear energy to reduce foreign energy dependence after
the oil shock of the 1970s. It now receives nearly 80 percent of its electricity from nuclear power and is a
net exporter of electricity.[1] Germany, alternatively, decided to phase out nuclear energy for political
reasons and now imports some of this energy.[2]
Japan is another country that has looked to nuclear power as a clean, safe and reliable form of energy.
Nuclear power already provides 30 percent of the country's electricity; however, Japan is working to
increase this to 37 percent by 2009 and 41 percent by 2017.[3]
Finland, ranking fifth in the world for per capita electricity consumption, has a significant incentive to
secure long-term energy solutions. Embracing nuclear energy as part of an effort to decrease the
nation's dependency on foreign energy sources, Finland has begun constructing a modern 1,600-
megawatt reactor, which will likely be a model used throughout the United States. Finland already gets
28 percent of its electricity from nuclear power, and a possible sixth reactor would increase that amount
substantially.
Presently, the U.K. has 19 reactors that provide about 18 percent of the nation's electricity. Because the
U.K. is already a net importer of energy and all but one of its coal-fired and nuclear plants are
scheduled to be decommissioned by 2023, building new reactors is a must for the U.K. if it is to avoid
creating increased energy dependencies. The British government, while providing long-term politically stable
support for nuclear power, has made it clear that it would not subsidize the industry. The U.S., on the other
hand, continues to squabble politically about nuclear power but has offered some subsidies to the
industry. As a result, the British model should provide a sustainable environment for nuclear power
moving forward, while the U.S. model could create a politically tenuous dependency relationship between
government and industry.
Gonzaga Debate Institute 2008 20
Lacy/Symonds/Bowen R&B (Oil)
Renewables Brink
Renewables are close to reaching critical mass worldwide
Rodriguez, 2008 (Jasmine, June 18, “’Tipping Point’ for Renewable Energy”, OneWorld
US, http://news.yahoo.com/s/oneworld/20080618/wl_oneworld/45361609141213830426,
July 11, 2008)
Renewable energy is approaching a "tipping point" and should expand dramatically in the next decade,
further narrowing the gap between alternative forms of energy and fossil fuel use, said environmental and
economic experts at a forum here Monday.
"Increasing market demand, policies, and investment trends are creating a perfect storm for the
growth of renewable energy across the world," said Christopher Flavin, moderator of the forum and
president of the Worldwatch Institute. "We are at a point where all of these factors will allow renewable
energy to move into the mainstream."
Sixty-six countries have set policy targets to increase their investment in renewable energy, including
22 developing countries and all 27 EU countries, said Martinot, lead author of Worldwatch's "Renewables
2007 Global Status Report."
"Growth [in renewables] is driven by policy rather than efficiency," added Liebrich, emphasizing that the
market "[doesn't] need lots of new policies because the policies we've got are generating lots of growth
already -- although we can't let those policies expire."
Martinot, a visiting professor at Tsinghua University in Beijing, also praised China for having the most
comprehensive energy targets of any country and exceeding its wind power targets for 2010.
Developing nations, like China, hold 40 percent of the world's capacity for renewable energy in solar, wind,
and other sources, he said.
Gonzaga Debate Institute 2008 21
Lacy/Symonds/Bowen R&B (Oil)
If companies don’t change to green, they are threatened by a damaged reputation from the
public.
Filman, Editor, 07
(Hugh, Direct Response, “Going green inevitable,” 7/25, Lexis, date accessed: 7/3/08
Arguably, there are a lot worse polluters than the direct mailers when it comes to paper refuse. But, as so
often is the case, perception is more important than reality when it comes to what the public thinks and
- more importantly - how the government might react. If the DM industry does not clean up its act of
its own volition now - or at least very soon, with an action plan in place now - it will eventually be made
to do so by the Government. With weather around the world getting warmer and more unpredictable with
each coming year, this is not an issue that will fade out of the public consciousness. The media will keep
looking for culprits and direct marketers will remain easy targets. Thankfully, some in the industry
are not simply content to leave the issue simmering. Royal Mail has launched a carbon-neutral doordrop
programme to encourage greener behaviour among companies doing unaddressed mailings, and the Direct
Marketing Association has come out with the first in a series of quarterly environmental guides aimed at
helping companies figure out how to be greener (page 8). In our cover feature, we offer guidance on how
companies can make their printing and mailing more environmentally friendly - and how going green can
actually make good business sense (page 43).
Gonzaga Debate Institute 2008 24
Lacy/Symonds/Bowen R&B (Oil)
Alternative energies can never compete in the marketplace if fossil fuels are cheaper
HardAssetsInvestor.com 11-5-07
“Alternative Energy: Can it Compete” http://www.hardassetsinvestor.com/component/content/article/552.html
Accessed: 7/6/08
Advancements in technology and fossil fuel market conditions have made growth and capital gains in the
alternative energy sector possible, and show signs of continuing to do so. Wind and solar energy have seen
rapid growth in recent years, and tidal energy is an emerging sector across the globe. Until recently, large
scale alternative energy production hasn't been an option mainline energy companies were willing to
explore, but because production costs have lowered and fossil fuel prices have climbed, even the oil
majors are starting to look. We're not on par yet for all alternative energy prices yet, but the trend is in
the right direction.
High oil prices are the only thing driving alternative’s development, falling below a certain
threshold risk a reversal of policy
Hyun-cheol, staff writer ‘08
The Korea Times “Big 3 Lead Alternative Energy Development” 6/9/08
http://www.koreatimes.co.kr/www/news/biz/2008/06/123_25567.html Accessed: 7/4/08
In spite of its availability, solar energy has long been estimated to be of low efficiency due to its high
power-generating cost. However, recent predictions that oil prices will jump to over $200 per barrel
cast new light on its prospects as it takes only $160-180 to produce the same amount of energy as
petroleum.
Turns case – low oil prices harm the environment and prevent switch to alt energy
Coy, Economics editor for BusinessWeek, 97
(Peter, Business Week, “COMMENTARY: CLEAN AIR IN AN ERA OF CHEAP OIL,” 11/3,
http://www.businessweek.com/1997/44/b3551008.htm, date accessed: 7/2/08)
The expensive oil of the 1970s and early 1980s had one virtue: By discouraging consumption, it lessened
the pollution caused by the burning of gasoline, diesel, and other petroleum products.
Environmentalists hoped rising oil prices would promote a switch to cleaner energy sources, such as
solar power. If oil instead remains cheap for decades to come, the harm to the environment from sulfur
dioxide, carbon monoxide, particulates, and other poisons could be enormous. Combustion of oil, coal, and
other carbon-based fuels may also overheat the planet by creating an insulating layer of carbon dioxide.
Indeed, cheap oil is bound to complicate efforts to achieve a treaty on global warming in Kyoto, Japan, this
December (page 158).
Gonzaga Debate Institute 2008 32
Lacy/Symonds/Bowen R&B (Oil)
Increased consumption of fossil fuels increases emissions and seeps toxic waste into the
environment
Shahrtash, Ministry of Energy employee ‘07
F.M, Ministry of Energy – Tehran “Assessment of Trace Element Released in Tehran, Norway and Austria, dealing
with Transportation and Sustainable Development” 10/30/07
http://www.isesco.org.ma/ISESCO_Technology_Vision/NUM04/Num4/Shahrtash%20Iran.pdf Accessed: 7/12/08
The high deposition of heavy metals of Pb, Cd in soil of Tehran is due to the high consumption of fossil
fuels and from the exhaust of automobils which is discussed in terms of heavy traffic load and the rise
up of population, which seems higher in south and center area of Tehran rather than the north of
Tehran. The variation of concentration of hevy metals of Pb and Cd are considerable due to the seasons,
where it seems to be higher in autumn than the spring because of the accumulation of heavy metal released
into the atmosphere. The high concentration of heavy metals in plant species is due to the high concentration
of the soil contents corresponding to the measurements made in spring-autumn in the range of 17.5- 66.6
(ppm) and 24-41.8 (ppm) respectively.
Price drops increase global oil consumption meaning the plan’s solvency is limited at best.
Catherine Hagem, Center for Climate and Energy research, 1994
[Energy Journal p. 119]
Emission of carbon dioxide (C02) is an international problem. It is the total global amount of emissions that
is significant, not the geographical location of the sources. The benefit of unilateral action to curb C02
emissions depends on the contribution to the changes in the global discharge. A unilateral action taken by a
single country will have only a limited effect on the global emissions. The reason for this is partly that
no single country's discharge counts for more than 25% of global emissions. Furthermore, reduced
consumption can cause the international fuel prices to fall. The reduction in prices has the undesirable
effect of giving other countries an incentive to increase their use of fossil fuels and partly offset the
initial reduction. This effect of unilateral actions is often measured by the so called "leakage rate," which is
the percentage by which resulting global reduction fall short of initial cutbacks.
Gonzaga Debate Institute 2008 34
Lacy/Symonds/Bowen R&B (Oil)
SUV/Trucks Add-on
Use of petrol in large trucks and SUV’s are the largest contributor to warming
EcoBridge Non-profit environmental organization ‘08
“Causes of Global Warming” February 3rd 2008 http://www.ecobridge.org/content/g_cse.htm Accessed:
7/3/08
About 33% of U.S carbon dioxide emissions comes from the burning of gasoline in internal-
combustion engines of cars and light trucks (minivans, sport utility vehicles, pick-up trucks, and jeeps).US
Emissions Inventory 2006 page 8 Vehicles with poor gas mileage contribute the most to global warming.
For example, according to the E.P.A's 2000 Fuel Economy Guide, a new Dodge Durango sports utility
vehicle (with a 5.9 liter engine) that gets 12 miles per gallon in the city will emit an estimated 800 pounds
of carbon dioxide over a distance of 500 city miles. In other words for each gallon of gas a vehicle
consumes, 19.6 pounds of carbon dioxide are emitted into the air. [21] A new Honda Insight that gets 61
miles to the gallon will only emit about 161 pounds of carbon dioxide over the same distance of 500 city
miles. Sports utility vehicles were built for rough terrain, off road driving in mountains and deserts.
When they are used for city driving, they are so much overkill to the environment. If one has to have a
large vehicle for their family, station wagons are an intelligent choice for city driving, especially since their
price is about half that of a sports utility. Inasmuch as SUV's have a narrow wheel base in respect to their
higher silhouette, they are four times as likely as cars to rollover in an accident. [33]
The United States is the largest consumer of oil, using 20.4 million barrels per day. In his debate with former
Defense Secretary Dick Cheney, during the 2000 Presidential campaign, Senator Joseph Lieberman said, "If
we can get 3 miles more per gallon from our cars, we'll save 1 million barrels of oil a day, which is exactly
what the (Arctic National Wildlife) Refuge at its best in Alaska would produce."
If car manufacturers were to increase their fleets' average gas mileage about 3 miles per gallon, this country
could save a million barrels of oil every day, while US drivers would save $25 billion in fuel costs annually.
And high gas prices are the lone driving force behind the abandonment of SUV’s and
trucks, reversing this trend will inevitably lead to their resurgence
FOX News ‘08
“High Gas Prices Driving SUV’s to Extinction” June 11th 2008
http://www.foxnews.com/story/0,2933,365714,00.html Accessed: 7/3/08
DETROIT — Even in northern Wisconsin, where midsize sport utility vehicles are as common as deer,
people are starting to abandon them because of high gasoline prices.
It's one of the last places to back away from the class of SUVs, which includes the once-popular Ford
Explorer and Chevrolet TrailBlazer. Some industry analysts are already declaring the midsize SUV extinct.
"They're dinosaurs. Put a fork in them," Erich Merkle, vice president of auto industry forecasting for the
consulting company IRN Inc. in Grand Rapids, Mich., said in an interview.
It's no secret that drivers are flocking to smaller, more fuel-efficient cars as the cost of gas marches
higher. And midsize SUVs are built on the same frames as trucks, which add extra weight and drink
more fuel.
Gonzaga Debate Institute 2008 35
Lacy/Symonds/Bowen R&B (Oil)
***Backstopping DA***
Gonzaga Debate Institute 2008 37
Lacy/Symonds/Bowen R&B (Oil)
B. Any policy that attempts reduce demand for oil causes prices to lower which increases
consumption
Feldstein, Chairman of the Council of Economic Advisers under President Reagan, Professor at
Harvard and a member of The Wall Street Journal's board of contributors, 2008
(Martin, Wall Street Journal, “We Can Lower Oil Prices Now”, 07-01-08,
http://online.wsj.com/article/SB121486800837317581.html?mod=googlenews_ws, accessed 07-
01-08)
The relationship between future and current oil prices implies that an expected change in the future
price of oil will have an immediate impact on the current price of oil.
Thus, when oil producers concluded that the demand for oil in China and some other countries will grow more rapidly in future years
than they had previously expected, they inferred that the future price of oil would be higher than they had previously believed. They
responded by reducing supply and raising the spot price enough to bring the expected price rise back to its initial rate.
Hence, with no change in the current demand for oil, the expectation of a greater future demand and a higher future price caused the
current price to rise. Similarly, credible reports about the future decline of oil production in Russia and in Mexico implied a higher future
global price of oil – and that also required an increase in the current oil price to maintain the initial expected rate of increase in the price
of oil.
Once this relation is understood, it is easy to see how news stories, rumors and industry reports can cause substantial fluctuations in
current prices – all without anything happening to current demand or supply.
Of course, a rise in the spot price of oil triggered by a change in expectations about future prices will cause a decline in the current
quantity of oil that consumers demand. If current supply and demand were initially in balance, the OPEC countries and other oil
producers would respond by reducing sales to bring supply into line with the temporary reduction in demand. A rise in the expected
future demand for oil thus causes a current decline in the amount of oil being supplied. This is what happened as the Saudis and others
cut supply in 2007.
Now here is the good news. Any policy that causes the expected future oil price to fall can cause the
current price to fall, or to rise less than it would otherwise do. In other words, it is possible to bring
down today's price of oil with policies that will have their physical impact on oil demand or supply
only in the future.
For example, increases in government subsidies to develop technology that will make future cars more
efficient, or tighter standards that gradually improve the gas mileage of the stock of cars, would lower
the future demand for oil and therefore the price of oil today.
Similarly, increasing the expected future supply of oil would also reduce today's price. That fall in the
current price would induce an immediate rise in oil consumption that would be matched by an
increase in supply from the OPEC producers and others with some current excess capacity or
available inventories.
Any steps that can be taken now to increase the future supply of oil, or reduce the future demand for
oil in the U.S. or elsewhere, can therefore lead both to lower prices and increased consumption today.
Gonzaga Debate Institute 2008 38
Lacy/Symonds/Bowen R&B (Oil)
When the US adopts alternative energy as a response to high prices, OPEC will flood the
mrket with cheap oil
Maugeri PhD in international political economy. ENI SPA's group senior vice-president (director) of
corporate strategies and international relations ‘03
Leonardo, Oil and Gas Journal “Time to debunk mythical links between oil and politics” December 15 2003.
Proquest.com Accessed 7/2/08
When the second oil shock (1979-81) hit and panic once again spread, many forces were already in
motion to dramatically reduce OPEC power. Basically, it sufficed to adopt policies to encourage energy
efficiency, exploit new oil fields worldwide (with higher costs but more political security), and promote
other sources of energy (nuclear and natural gas) in order to provoke a fall in Western oil demand (about
4-5 million b/d during 1980-83), a dramatic drop in oil prices, and the birth of a competitive oil market.
OPEC will drop its prices if anything threatens their total market control
Castillon et al Petroleum working group at the ‘French Academy of Technology’ ‘07
Pierre, Institut Francais Du Petrole, “Depletion of Petroleum Reserves and Oil Price
Trends” November 2007 http://www.energypolicyblog.com/wp-
content/uploads/2008/03/at200711en.pdf Accessed: 7/2/08
The situation has changed since then. The belief, up until 1985, in an ineluctable growth in prices
stimulated significant research and development efforts. The resulting technological progress has led
to the discovery of hard-to-find deposits, to noticeable improvements in rates of recovery, and to the
development of “non-OPEC” oil, especially offshore. After the 1986 price drop, these efforts were
continued and led to a sharp decrease in exploration and production costs in non-OPEC countries,
especially for deep-sea oil. The frontier between conventional and non-conventional oil (deep-sea oil,
extra-heavy oil, tar sand) is regularly being pushed back. Producers can now access offshore deposits at
increasingly greater depths using technologies that are constantly being improved. Figure 5 illustrates the
progress made in this field. The difference between the production costs of offshore and on-shore oil is
decreasing. As indicated above, the extra-heavy oil in the Orinoco Basin in Venezuela was, until the 1990s,
considered to be practical to produce only at a relatively high price per barrel of crude (at the time, $40 or
more). The production cost of this type of oil is now around $20 a barrel of crude, and large-scale production
has begun. We’ll discuss the technological costs in the following section.
Gonzaga Debate Institute 2008 44
Lacy/Symonds/Bowen R&B (Oil)
Cutting consumption causes OPEC overreaction, flooding the market or spiking prices
Noreng professor of petroleum economics and management at the Norwegian School of Management, ‘02
Oystein, “Crude Power: Politics and the Oil Market”, 2002, p. 186
A major problem in implementing additional taxes on oil consumption is the risk of OPEC retaliation
combined with the impossibility of stabilizing crude oil prices in the longer run. New taxes on oil
products could invite OPEC to raise crude oil prices to compensate for the rising share of economic
rent captured by the oil consumer governments, reasoning that the oil price rise would not cause a
corresponding volume loss so that there would be a net revenue gain. The alternative could be to flood
the market with cheap oil to make up in volumes for a perceived loss in world market crude oil prices.
The risk is that either option would overshoot and enhance instability.
Cutting fossil fuel consumption causes OPEC to flood the market, increasing consumption
worldwide
Noreng professor of petroleum economics and management at the Norwegian School of Management, ‘02
Oystein, “Crude Power: Politics and the Oil Market”, 2002, p. 204
Comprehensive measures aimed at curbing the use of fossil fuels could cause OPEC or the key Middle
Eastern oil exporters to raise output to compensate for the price loss, aiming at market share. The
temptation could be to flood the market with cheap oil, giving a strong competitive advantage to countries
that do not impose high consumer taxes on crude or oil products. OPEC would lose economic rent, but some
low-cost OPEC countries would gain in volume. Nevertheless, the outcome would be a transfer of income
from the oil exporters to the oil importers. The effect could be a more strongly rising oil demand in
developing countries.
Gonzaga Debate Institute 2008 45
Lacy/Symonds/Bowen R&B (Oil)
*Ali Ibrahim al-Naimi is minister of petroleum and mineral resources for Saudi-Arabia.
Investment in renewable energy will cause the Saudis to flood the market
Norris, Chief financial correspondent of The New York Times, 2000
(Floyd, New York Times, “Crude Error: How we grew vulnerable to high oil prices,” 06-
23-00, http://query.nytimes.com/gst/fullpage.html?
res=9C04E7DB1F31F930A15755C0A9669C8B63&sec=&spon=&pagewanted=print, access
07-02-08)
WHY are gasoline prices so high?
It's the demand, stupid.
For those who remember the 1970's, there is something very familiar about oil ministers meeting in Vienna to decide whether to open
the production taps a bit further as analysts debate whether 700,000 barrels a day of additional production will make much difference.
The answer is, it won't. Because if that extra supply would change things very much, that supply would vanish. The oil crisis, circa 2000,
is not a supply-side phenomenon.
That is because the oil market is nothing like a normal market. In a normal market, the marginal producer, the one who provides the last
bit of supply, is the high-cost producer. If prices rise a lot, that producer can finally make a profit and he starts to increase supply. That
supply meets rising demand and helps to hold down prices.
In oil, however, that situation is turned on its head. The marginal suppliers in that market are the gulf states, principally Saudi Arabia
and Kuwait. They are also the lowest- cost producers, and the ones with reserves that will last for decades. The high-cost producers,
including many wells in this country, are pumping all out and will not add production anytime soon no matter how high the price goes.
When demand is weak, oil prices can collapse because many oil producers need revenue and will pump all they can. That happened most
recently in 1998, when Asian economies went in the tank. But when demand is strong, as it is now, it is futile to rely on oil producers to
start cheating and driving the price down, or to hope that diplomacy can have much of an effect.
What would lead the Saudis to start pumping enough oil to lower prices? In a word, fear. If they feared
that a worldwide recession was imminent and knew that would cause demand to plummet, they might act.
There is no such fear now.
But the other fear is a longer-range one. A trend away from oil would be a scary phenomenon to the oil-
rich Saudis, and they would hate to see a renewal of the 1970's trends toward better fuel economy and
alternative energy sources. They are no doubt thrilled that the American law mandating high fuel economy for cars has a huge
loophole classifying gas-guzzling sport utility vehicles as trucks.
Gas prices have entered the political debate this year, but not in any way that should scare the Saudis. Republicans blast pollution rules
for driving up the cost of gasoline in the Midwest. Democrats suspect oil companies are seizing an opportunity to increase profit
margins. Both are right, at least to some extent, but both are beside the point.
The real mistake in Washington came in the years after the last oil crisis, when oil prices were weak and Americans lost
interest in energy conservation. Higher gas taxes and less loophole-laden fuel-economy rules would have helped avert the
current problem.
Such actions were not taken because no effective lobbying groups were backing them and because they didn't sound like vote winners.
The last president to really push energy conservation was Jimmy Carter -- remember the sweaters he wore as he urged us to turn down
the heat in our homes -- and everyone knows what happened to him.
So now oil prices are high, and they are likely to remain above $25 a barrel until growth slows significantly in an important region of the
world -- or until the Saudis grow worried that this country will again get serious about energy conservation and research into alternative
energy sources. It's the demand that counts.
Gonzaga Debate Institute 2008 47
Lacy/Symonds/Bowen R&B (Oil)
Saudi Arabia along with other OPEC nations have plenty spare capacity
Reuters ‘08
Boston Globe “ OPEC Nations Considering Increase in Oil Production” 6/22/08
http://www.boston.com/news/world/articles/2008/06/22/opec_nations_consider_increase_in_oil_production/
Accessed: 7/12/08
Saudi Arabia, the world's biggest oil exporter, has a policy of keeping a cushion of spare capacity and
has said other OPEC members that can bring on extra production quickly would also discuss boosting
output to try to tame the oil rally. "The short-term policies to be discussed include the proposal that
those OPEC countries that have spare capacity should boost supply, just like Saudi Arabia has
announced it will do in July," a senior OPEC official said. Looking to the longer term, the source also
said Saudi Arabia would consider increasing its capacity beyond an existing goal of 12.5 million
barrels per day by the end of next year. The two other OPEC members with some extra capacity are
the United Arab Emirates and Kuwait. Another OPEC delegate said it was not yet clear whether they
would join in any output rise. Mohammad al-Olaim, Kuwait's oil minister, said he had no plans to raise
output ahead of the talks, but would consider options afterward.
OPEC nation Saudi Arabia has the capability to flood the oil market if deemed necessary
Landers, Business Correspondent for the Dallas Morning News, 08
(Jim, Ottawa Citizen, "Saudis to supply oil to meet world demand: Unclear whether price will drop, analysts say," 6-
23-8, http://www.canada.com/ottawacitizen/news/story.html?id=a4e38a75-ef0c-49eb-b843-f16dbb93dda0, 7-10-8)
Saudi Arabia yesterday said it would supply enough oil to meet global demand for the rest of the year,
but differed sharply with the U.S. government by blaming speculators for the sharp increase in oil
prices. King Abdullah, the Saudi monarch, hosted yesterday's emergency meeting of producers, consumers
and global oil companies to find a way to curb price spikes that have carried oil near $140 US a barrel and
pushed U.S. gasoline prices past $4 a gallon. The king, in gruff remarks at the opening of the meeting,
blamed "the frivolity of the speculators in the market for selfish interests," rising consumption in developing
countries and high energy taxes in the West and said it was wrong to blame OPEC. "Your mission is to rule
out biased rumours and to reach the real causes for the increase in price," the king urged the delegates. But
U.S. Energy Secretary Samuel Bodman blamed oil producers. "While increases in near-term oil
production like the one Saudi Arabia offered today are welcome and necessary, fundamentally the
market needs to see investments in increased long-term production capability and spare capacity," Mr.
Bodman said in a prepared statement e-mailed to reporters. A grim-faced Mr. Bodman left the meeting
striding so rapidly through the lobby of the Jeddah Hilton Hotel that some of his staff had to run to catch up.
Analysts were divided on whether the meeting would lead to lower oil prices. "What I've heard so far are
basically all good ideas, but it will probably not change the price tomorrow morning," Royal Dutch Shell
CEO Jeroen van der Veer told Reuters in Jeddah. Houston oil analyst Amy Jaffe said speculative buying
had pushed oil prices into a bubble that could burst and drop the price back to $100 a barrel. "They
(Saudi Arabia) have extra capacity and they know how to flood the market by changing their pricing
system, should they decide to," she said.
Gonzaga Debate Institute 2008 54
Lacy/Symonds/Bowen R&B (Oil)
Lack of spare capacity is a myth – the Saudis have massive oil reserves
MSNBC ‘08
“Saudis signal boost in production capacity” 6/21/08 http://www.msnbc.msn.com/id/25305036/ Accessed: 7/12/08
"This rise allows them to raise current output, while at the same time maintain a cushion of spare
capacity," said CNBC contributor John Kilduff, a senior vice president at MF Global Ltd. "There was a
concern in the market that any output rise would leave us with no room for error in terms of any other
outages. This should relieve some of those concerns."
Gonzaga Debate Institute 2008 55
Lacy/Symonds/Bowen R&B (Oil)
OPEC will keep oil prices at such a level as to prevent switch to alternative fuels
Castillon et al Petroleum working group at the ‘French Academy of Technology’ ‘07
Pierre, Institut Francais Du Petrole, “Depletion of Petroleum Reserves and Oil Price
Trends” November 2007 http://www.energypolicyblog.com/wp-
content/uploads/2008/03/at200711en.pdf Accessed: 7/2/08
We mentioned restraints on investment and the low elasticity of demand to price. Except for a major global
economic crisis, it is hard to imagine a rapid restoration of significant excess production capacity.
Consequently, it is not impossible that prices will remain high in the coming years, and may even be subject
to new tensions as a result of geopolitical events. If excess capacity does appear, as indicated above (CERA,
IFP and other studies), these will most likely be limited to values that can be managed by OPEC. Prices
should be able to be maintained at a level considered desirable by Saudi Arabia and its partners. They
have learned the lesson of the 1986 price drop and are likely to define a price, or range of prices, that
do not lead to a collapse of demand for OPEC oil through the use of alternative fuels and energy
savings. It is hard to estimate that level. It will most likely be less than the price reached during the
summer of 2006, but will certainly be greater than that of the 1990s. Indeed, the growth in demand and
the next occurrence of a leveling-off of non-OPEC production make it unlikely we will see any substantial
erosion of OPEC market share at prices of $40, or even $50 a barrel. In the medium term, such levels could
form a lower limit for declining prices. Inthe longer term, there are a variety of possible scenarios.
Its happened once and it can happen again, flooding the market with cheap oil ensures US
dependence on oil
Dorraj, teacher of polysci at at Texas Christian University. ‘93
Manochehr, Arab Studies Quarterly “Will OPEC Survive” Fall 1993
http://findarticles.com/p/articles/mi_m2501/is_n4_v15/ai_16075108/pg_9?tag=artBody;col1 Accessed: 7/4/08
Frustrated by these developments and extensive cheating on production quotas among OPEC members and
resolved to drain Iran's financial resources and hamper her ability to continue the war with Iraq, the
Saudis began to flood the market by increasing their share of production. The result was an oil glut
and the collapse of prices to as low as $10 per barrel in 1986.
The Saudis also hoped that the lower prices would reduce the non-OPEC share of the market and
discourage research and development in alternative sources of energy, thus ensuring long-term
Western dependence on OPEC oil.(1)
Gonzaga Debate Institute 2008 58
Lacy/Symonds/Bowen R&B (Oil)
High oil prices promote energy conservation while low prices increase consumption
China Org, 08
(“Fuel prices increase positive for energy saving,” 6/25, http://www.china.org.cn/environment/opinions/2008-
06/25/content_15886710.htm, date accessed: 7/12/08)
The action has caused wide concern, as some economists worry that the price increase might fuel inflationary
pressure. However, an editorial in the Beijing News pointed out that the price rise is a good chance to
promote energy conservation. The paper says in the past, the central government has always provided
financial subsidies to maintain relatively low oil price. Furthermore, the low oil price has to some extent
encouraged energy consumption. This is also why sales of fuel-inefficient cars like SUVs have increased
greatly in China in the past three years.
Price drops from $130 to $65 results in a 1.5 million barrel change in demand
IHT Global edition on the NYT ‘08
International Herald Tribune “Asia’s Oil subsidies” 5/30/08
http://www.iht.com/articles/2008/05/30/opinion/edbowring.php Accessed: 7/12/08
There is no accurate way to measure how sensitive demand is to rising oil prices across this diverse
group of countries. But the difference between oil at $65 a barrel and oil at $130 a barrel could well
limit demand by at least 1.5 million barrels a day.
Sudden rises in oil prices could depress consumption in countries like China and Malaysia, where
additional domestic demand may be needed to compensate for slowing export growth. There is merit in some
subsidies, at least in the short term. Many lower income people cook with kerosene or get to work on motor
bikes. Related fertilizer subsidies may also be necessary to sustain food output.
Gonzaga Debate Institute 2008 63
Lacy/Symonds/Bowen R&B (Oil)
Even small decrease in prices increases consumption enough to turn the case.
Catherine Hagem, Center for Climate and Energy research, 1994
[Energy Journal p. 120]
Reduced consumption of fossil fuels in a small country will have only a small effect on international
fossil fuel prices. However, even a minimal decrease in international fuel prices will have a positive
impact on consumption in the rest of the world. Although the increase in consumption in the rest of the
world is negligible in relation to total global consumption, it can be significant in relation to the initial
national reduction. The final impact on global emission reduction can thus be significantly less that the
initial reduction in national emissions.
Gonzaga Debate Institute 2008 65
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A2: OPEC can’t flood the market – they’ll create the perception
OPEC cannot flood the market but will do everything it can to make the public perceive it
can
Campbell, Trustee of the Oil Depletion Analysis Centre, 2000
(C.J, Oil Crisis, “Myth of Spare Capacity
Setting the Stage for Another Oil Shock,” 3/20, http://www.oilcrisis.com/campbell/mythcap.htm, date accessed:
7/11/08
A combination of circumstances led to a dramatic fall in the price of oil in 1998. They included
unseasonably warm weather; an Asian recession that reduced the demand for swing Middle East production;
the collapse of the ruble, encouraging exports; and further turns in the UN-Iraq imbroglio. The market itself,
which now included hedge funds and derivative merchants, had no alternative but to over-react because of its
transparent short-term nature. The major companies, plainly seeing that exploration could not underpin
their future, took the opportunity of the price crisis to merge, successfully concealing their real
predicament from the stockmarket. Budgets were slashed, and a climate of uncertainty led to an
improvident draw on stocks. Everyone hung on the pronouncements of OPEC, imagining that it held
the key. Norway and Mexico offered to cut production to help support price. The OPEC countries
themselves did everything possible to foster the notion that they could flood the world with cheap oil at
the flick of a switch. It was a strategy aimed to inhibit investments in gas, non-conventional oil,
renewable energy or energy saving that they feared might undermine the market for their oil, on
which they utterly depend.
Gonzaga Debate Institute 2008 66
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***Renewables DA Answers***
Gonzaga Debate Institute 2008 67
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Environmental initiatives are still being struck down, effectively delaying them at least
until the next president takes office
New York Times, 08
(New York Times, "Court Rejects Clean Air Rules," 7-11-8,
http://www.nytimes.com/2008/07/12/washington/11CLEANcnd.html?_r=1&oref=slogin, 7-11-8)
A federal appeals court unanimously struck down a major component of President Bush’s clean air
policies on Friday, effectively delaying further action on reducing smog and soot-producing emissions
until the next administration takes office. North Carolina and some electric power producers opposed aspects of the
regulation, known as the Clean Air Interstate Rule, creating a rare instance in which President Bush found himself allied with
environmental advocates. The act required 28 states, largely on the East Coast, to reduce the pollutants that
can travel long distances in the wind, which the Environmental Protection Agency predicted it would
prevent about 17,000 premature deaths a year. ”This the rare case where environmental groups went to court alongside
the Bush administration,” said Frank O’Donnell, president of Clean Air Watch, a group that has criticized other Bush administration
policies. The United States Court of Appeals for the District of Columbia Circuit ruled that the environmental agency overstepped its
authority by instituting the rule. It said the Clean Air Act did not give the E.P.A. the authority to change pollution standards the way it
did. Citing "more than several fatal flaws,” the court scrapped the entire regulation. ”This is without a doubt the worst news
of the year when it comes to air pollution,” Mr. O’Donnell said. The environmental agency said the
rule would have drastically reduced sulfur dioxide and nitrogen oxide emissions, saving up to $100
billion in health benefits by preventing tens of thousands of heart attacks millions as well as lost work
and school days. While the Bush administration could appeal the decision, environmental groups called for Congress and the
E.P.A. to quickly begin working on a new law or a replacement regulation. The ruling was somewhat of a surprise, even to industry
groups that had challenged aspects of the law. William M. Bumpers, a lawyer representing Entergy Corp., said a few electric companies
flatly opposed the regulation but most generally favored it because it included cap-and-trade provisions that allow them to exceed
emissions caps to buy credits from those who do. “The power-generating industry had already invested billions and billions of dollars in
anticipation of the trading market,” Mr. Bumpers said. ”They’re not happy with this development.”
Gonzaga Debate Institute 2008 69
Lacy/Symonds/Bowen R&B (Oil)
No alternatives are coming in the status quo—the United States are on path of destruction
due to the fact
Freeman, Writer specializing in economics, 2004
(Robert, Common Dreams.org, “Will The End of Oil Mean The End of America?”, 3-1-2004,
http://www.commondreams.org/views04/0301-12.htm, Date accessed: July 1, 2008)
As with Pirsig’s monkey, the alternative consequences of each choice could not be more dramatic. Weaning
ourselves off of cheap oil, while not easy, will help ensure the vitality of the American economy and the
survival of its political system. Choosing the route of force will almost certainly destroy the economy
and doom America’s short experiment in democracy. To date, we have chosen the second alternative:
to secure oil by force. The evidence of its consequences are all around us. They include the titanic US
budget and trade deficits funding a gargantuan, globally-deployed military and the Patriot Act and its starkly
anti-democratic rescissions of civil liberties. There is little time left to change this choice before its
consequences become irreversible.
Gonzaga Debate Institute 2008 72
Lacy/Symonds/Bowen R&B (Oil)
Chinese oil consumption will double in 10 years – ensuring that they will buy any extra oil
Business Week ‘05
“Napolean of China’s Oil Patch” 6/20/05
http://www.businessweek.com/magazine/content/05_25/b3938063.htm Accessed: 7/10/08
There's good reason to believe that bullish prediction. China is sucking up energy faster than any country
on earth, and that's not likely to change anytime soon as foreign investment continues to pour in and
Chinese consumers boost their spending by 10% or more annually. Beijing expects energy
consumption to double by 2020, which gives CNOOC "a very good outlook," says Hernan Ladeuix, head of
oil and gas research at CLSA Asia-Pacific Markets. "The Chinese companies will all benefit."
Gonzaga Debate Institute 2008 76
Lacy/Symonds/Bowen R&B (Oil)
Even if the US reduces demand oil prices will remain high – too many other factors
TIME ‘08
“OPEC: Gas Prices Will Stay High” April 11th 2008
http://www.time.com/time/world/article/0,8599,1730117,00.html Accessed: 7/11/08
Naimi had no good news for those hoping for some relief from sky-high prices. He said it could take "at
least 50 years" for the world to comprehensively adopt alternatives to the oil and gas that today account for
about 90% of world energy consumption. Naimi castigated Western governments that have pushed biofuels
as the major energy alternative, which has ravaged forests and agricultural land. Biofuels, he said, "will
produce just 6% of energy consumption by 2010, and has not even reduced greenhouse gases." Instead, the
world's most powerful oilman advocated "truly renewable sources of energy, like solar power." Saudi Arabia
this year committed $300 million to researching alternative energies, even though they plan within the next
year to boost their oil output from 11 million barrels a day to 12.5 million barrels a day.
The major cause of current high oil prices, of course, is record demand, fueled first and foremost by
China's booming economy. "China is the major factor in demand," says OPEC research director
Hasan Qabazard. He predicts that world oil demand will increase about 30% to 118 million barrels a
day by 2030. Then, there's the question of speculation and exchange rates: Investors have poured
billions into oil futures, in part because oil is priced in dollars, meaning that its price soars as the dollar
sinks. "There's only so much OPEC can do, because we have no influence over those factors," says
Qabazard.
Gonzaga Debate Institute 2008 77
Lacy/Symonds/Bowen R&B (Oil)
Even if US consumption goes down, the rest of the world will fill the gap
Mouawad, Journalist for the New York Times, 2008
(Jad, New York Times, “Amid High Oil Prices, Danger Signs in Production,” April 28th,
http://www.nytimes.com/2008/04/28/business/worldbusiness/28oil-WEB.html?pagewanted=1&_r=1&hp Accessed
on 7/11/08)
At the same time, oil consumption keeps expanding at a faster clip than production. Demand is
forecast to increase this year by 1.2 million barrels a day, to 87.2 million barrels a day. In the United
States, the world’s most oil-thirsty nation, consumption has actually fallen a bit because of the
economic slowdown.
But that drop is being offset by growth in other countries. World consumption is projected to rise 35
percent, to around 115 million barrels a day, in the next two decades. Most of the growth will come
from China, India and oil-producing countries in the Middle East, where retail fuel prices are subsidized,
encouraging wasteful consumption.
“What is disturbing here is that things seem to get worse, not better,” an analyst at Goldman Sachs, David
Greely, said. “These high prices are not attracting meaningful new supplies.”
Oil rose 23 cents Monday to $118.75 on the New York Mercantile Exchange. Longer-term oil futures, dated
for 2013, now trade at $108 a barrel, a strong indication that investors see little cause for prices to drop
in the next five years — partly because of low expectations about production growth.
Gonzaga Debate Institute 2008 80
Lacy/Symonds/Bowen R&B (Oil)
The Asian market’s demand will continue to increase over 30% a year
Paavo Suni, Researcher ETLA, and Anthony de Carvalho, 2006 (“Oil Prices Have Risen Permanently, But
Remain Unstable,” http://www.etla.fi/files/1490_FES_05_4_oil_prices_have_risen_permanently.pdf, March 24,
accessed online 7-11-08)
Thanks to two decades of strong economic expansion, China has become a major player in the world
economy. China’s share in world oil consumption was nevertheless only 8.2 percent in 2004. That same
year, however, China’s share of world demand growth was as much as 29 percent. Asia as a whole
explained 40 percent of the increase in world demand. For purposes of comparison, the U.S. share of
growth was slightly smaller than China’s, even though America’s share of consumption is around 25 percent.
The strength of demand for crude oil came as a surprise to the markets, which is visible in the increase
in crude oil futures price curves. Markets interpreted the change as being permanent, since the
quotations declined only slightly over time. This reflects the IEA’s projections that, given current trends,
significant oil-sector investments particularly in the Middle East and northern Africa will have to be made in
order to raise crude oil supply. Earlier, futures prices tended to converge towards much lower levels.
The demand for oil by rising economies means that there is no correlation between oil price
and development of alternative energy
Meyer and Swartz Writers for the Dow Jones newswire ‘08
Gregory and Spencer, CattleNetwork, “Energy Matters: Saudi Fears Of High Oil Prices Fade With Demand”5/5/08.
http://www.cattlenetwork.com/Content.asp?contentid=218898 Accessed: 7/2/08
Still, some leading energy and Middle East experts perceive a Saudi shift towards greater acceptance
of high prices amid surging demand from China and other developing economies. Next to these new
sources of demand there is diminished concern about high prices creating greater incentives for
competing sources of energy.
"Many years ago, before the demand side of the equation became so dominant, the view that if prices
were lower, alternatives could not survive was accepted," said James Oberwetter, former U.S.
ambassador to Saudi Arabia. "But the dawning of these huge new markets has really dimmed the
prospect for lower prices."
Gonzaga Debate Institute 2008 86
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Turn- Not only does demand in other countries maintain high oil prices, but the
development of alternatives in the US would actually increase prices
Maggs, economic editor for National Journal, 06. [John, “The Myth of Energy Independence,” National Journal
5/20/2006, Vol. 38 Issue 20, p57-58. Accessed 7/11/08 from EBSCOhost]
Bush and other presidents have said that energy independence will protect America from a cutoff in Middle
East oil supplies that would otherwise drive prices sky-high. But the history of supply cutoffs is limited--the
1973 oil embargo lasted only five months. Today, despite threats from anti-American regimes in the
region, few Mideast governments could afford to cut off their oil revenue. And that is what they would
have to do, since selling oil elsewhere would have the same effect as selling it to the United States.
Beyond this, America is less dependent on Middle Eastern oil than people think. Only about 10 percent of
U.S. petroleum consumption comes from the Middle East. Canada, Mexico, and other suppliers in the
Western Hemisphere supply three times as much. The U.S. Strategic Petroleum Reserve holds enough to
replace about two years' worth of Middle East oil imports.
And just as replacing oil from the Mideast with U.S. production would raise prices, so would replacing
it with alternative sources, at least for the foreseeable future, according to Felmy. Ethanol is
commercially viable only because of a federal mandate that it be added to gasoline, and because of a 51 cent
per gallon federal subsidy. To discourage imports and fatten farmers' wallets, the U.S. has tariffs on ethanol
of about 60 cents a gallon. Fourteen percent of the U.S. corn crop now goes to ethanol. Even at production
costs that Felmy estimated at the equivalent of $4 a gallon, America would have to use all of its corn crop to
supply the 30 percent of gasoline needs that Bush has cited as a goal.
Gonzaga Debate Institute 2008 87
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***Backstopping DA Answers***
Gonzaga Debate Institute 2008 89
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Global oil consumption on the rise while oil production levels off
Roberts, Journalist for National Geographic Magazine, 2008 (Paul, June 26, “World Oil: World oil demand is
surging as supplies approach their limits”, National Geographic Magazine,
http://thinkglobe.blogspot.com/2008/06/world-oil-world-oil-demand-is-surging.html, July 11, 2008)
The price surge that followed the Iran-Iraq war in the 1980s, for example, eventually unleashed so much new
oil that markets were glutted. But for the past few years, despite a sustained rise in price, global
conventional oil output has hovered around 85 million barrels a day, which happens to be just where
Husseini's calculations suggested output would begin to level off.
The change is so stark that the oil industry itself has lost some of its cockiness. Last fall, after the
International Energy Agency released a forecast showing global oil demand rising more than a third
by 2030, to 116 million barrels a day, several oil-company executives voiced doubts that production could
ever keep pace. Speaking to an industry conference in London, Christophe de Margerie, head of the French
oil giant Total, flatly declared that the "optimistic case" for maximum daily output was 100 million barrels
Oil prices are unstable because of the Iran crisis, Nigeria, and the US Recession.
Ould, Reuters, 2008 (Hamid, May 12, Oil prices to remain unstable for months: OPEC
head, accessed July 11, 2008)
Mon May 12, 2008 3:17pm EDTALGIERS (Reuters) - OPEC President Chakib Khelil said on Monday
geopolitical factors, speculation and the value of the dollar would continue to affect oil prices for the next
months or years.
"There is a geopolitical situation that the market expects to continue. You have the Iran crisis, the
crisis that may develop with Venezuela, with the possibility of the United States imposing an embargo
on Venezuela," he said.
"You have also problems in Nigeria," Khelil, who is also Algerian energy and mines minister, told
Algerian state television.
"You have all those elements plus the recession problem in the United States and the strong fall of
dollar, which has had a terrible impact on oil prices," he added.
"Therefore, there is speculation and geopolitical crisis. The market does not expect that to go away in
the next months or years."
(Reporting by Hamid Ould Ahmed; Editing by Christian Wiessner)
Gonzaga Debate Institute 2008 92
Lacy/Symonds/Bowen R&B (Oil)
Oil prices permanently high- political instability with Iran means speculation is at an all
time high
Gorondi, AP Staff Writer, 2008 (Pablo, “Oil sets new record near $147 a barrel,” The Associated Press, July 11)
Oil prices spiked Friday as continued tensions in the Middle East and concerns of renewed violence in
Nigeria pushed the price for a barrel of oil to a record near $147. By midday in Europe, light, sweet
crude for August delivery jumped $5.25 to $146.90 on the New York Mercantile Exchange. Oil prices had
fallen $10 over two days to start the week and as oil rebounded Friday, Dow Jones industrial average futures
fell more than 120 points. In London, August Brent crude soared $4.92 to $146.95 a barrel on the ICE
Futures exchange after hitting a record $147.25. "There's always a fear premium in pricing. The tensions in
Iran and the threat of supply disruption will help support oil prices," said Jeff Brown, managing director of
FACTS Global Energy in Singapore. JBC Energy in Vienna, Austria, said the news about Iran, Nigeria, as
well as a reported threat of a strike by oil workers in Brazil were "enough to wake the market from its two-
day slumber." A day after Iran tested a missile capable of reaching Israel, Secretary of State
Condoleezza Rice warned the oil-producing nation that the United States will defend its allies. Iran then
responded with another missile launch, drawing buyers back to jittery energy markets. Both the U.S. and
Israel have not ruled out a military strike on Iran. Domestically, there was another disappointing report on
U.S. stocks. Heating oil futures on Friday rose to a record $4.15 In other Nymex trading, adding more than
11 cents a gallon. The Organization of Petroleum Exporting Countries has warned that it cannot
replace the shortfall if Iran is attacked and takes its crude supplies off the market. The fear is that Iran,
OPEC's second-largest producer, could block the Strait of Hormuz, a passageway that handles about 40
percent of the world's tanker traffic. Meanwhile, attacks on Nigerian oil facilities could again disrupt
supplies in the oil-rich region. Nigeria's main militant group vowed Thursday to resume attacks because of
Britain's recent pledge to back the government in the conflict there. Unrest over the past two years have
already slashed the country's normal daily oil output by a quarter.
Gonzaga Debate Institute 2008 94
Lacy/Symonds/Bowen R&B (Oil)
Even if the market is flooded, refineries don’t have the ability to keep up with production >
and building infrastructure would take 5 years
Karey, et. Al, 08 (Gerald, Platts Oilgram Price Report, May 7, “US EIA sees higher prices, weaker demand;
Hikes 2008 crude price forecast to over $109.50/g”, Pg. 1 Vol 86 No. 88)
Oil refineries can't keep pace with demand
No new refinery has been built in the United States in the past 32 years. Capacity at existing refineries
has increased about 1% a year, failing to keep pace with demand, says Aaron Brady, a Cambridge
Energy Research Associates analyst.
Until recently, the tight supplies and surging demand allowed refiners, such as major oil companies, to
charge a premium of about $9 a barrel of oil, or 21 cents per gallon of gasoline, Brady says. This year,
however, high crude oil prices and lower U.S. demand have forced refiners to live with razor-thin
margins. That means if crude prices fall, some of the drop could be offset by higher profits for refiners.
The good news: Refiners worldwide are sharply expanding capacity. Oil consortium Motiva plans to double
capacity at its Port Arthur, Texas, facility by 2010, creating the largest U.S. refinery. Most of the new
equipment is designed to process heavy crude oil, which is more abundant and cheaper than light,
sweet crude but more expensive to refine.
The bad news: Refining makes up just 10% of the price of gas, so boosting capacity won't help much.
"Adding refining capacity is not going to have a significant impact on the price of gasoline," says Kevin
Lindemer of financial analysts Global Insight. And much of that refining infrastructure will take three to
five years to build, says analyst Robert Linden of Pace Global Energy Services.
Gonzaga Debate Institute 2008 96
Lacy/Symonds/Bowen R&B (Oil)
Increasing oil production is costly because demand continually increases the need for
expansions.
Paavo Suni, Researcher ETLA, and Anthony de Carvalho, 2006 (“Oil Prices Have Risen Permanently, But
Remain Unstable,” http://www.etla.fi/files/1490_FES_05_4_oil_prices_have_risen_permanently.pdf, March 24,
accessed online 7-11-08)
Indeed, a major problem plaguing the energy sector is the rapid pace of demand growth, which, if it is
to be met, requires massive capacity expansions, since crude oil production, among others, is already
running near full capacity. It is difficult to imagine how demand growth could slow significantly,
especially since transportation is so dependent on fossil raw materials. It is also difficult and expensive to
switch quickly to alternative energy sources. The problem with fossil fuels is that raising oil production is
difficult and costly and that they emit substantial carbon dioxide when burned. Global warming has
triggered efforts to contain growth in carbon dioxide emissions. Coal, natural gas, nuclear power, and
biomass energy have seen their shares in total energy consumption rise since the oil crises of the 1970s.
Gonzaga Debate Institute 2008 97
Lacy/Symonds/Bowen R&B (Oil)
Supply and demand curves and backstopping threats no longer apply to oil
Mouawad, Journalist for the New York Times, 2008
(Jad, New York Times, “Amid High Oil Prices, Danger Signs in Production,” April 28th,
http://www.nytimes.com/2008/04/28/business/worldbusiness/28oil-WEB.html?pagewanted=1&_r=1&hp Accessed
on 7/11/08)
As oil prices soared to record levels in recent years, basic economics suggested that consumption would
fall and supply would rise as producers opened the taps to pump more.
But as prices flirt with $120 a barrel, many energy specialists are becoming worried that neither seems
to be happening. Higher prices have done little to attract new production or to suppress global demand,
and the resulting mismatch has sent oil prices spiraling upward.
“According to normal economic theory, and the history of oil, rising prices have two major effects,”
said Fatih Birol, the chief economist at the International Energy Agency, which advises industrialized
countries. “They reduce demand and they induce oil supplies. Not this time.”
Gonzaga Debate Institute 2008 100
Lacy/Symonds/Bowen R&B (Oil)
OPEC’s ability to flood the markets is a MYTH—even the Saudi reserves are dry: OPEC HAS
NO INFLUENCE OVER OIL PRICES
Sodhi, Economist at the CIS, 2008
(Gaurav, The Center for Independent Studies, “The Myth of OPEC”, June 24th,
http://www.cis.org.au/executive_highlights/EH2008/eh63608.html, Date accessed: July 11, 2008)
Saudi Arabia no longer has the buffer of excess production, and there is a lack of confidence in the
sustainability of its largest fields. The long standing threat to flood the market with cheap oil has now
become a bluff, and the other members of OPEC know it. OPEC goes to great trouble to pretend that
it can influence prices. It holds regular meetings where it ordains a new production target with much
ceremony. But honestly, you would have to be a mug to believe that OPEC countries are purposefully
limiting production. When oil prices rise, so does the opportunity cost of sticking to the allocated quota. So
while its possible to maintain a cartel when prices are low, you can bet your life that each member is
pumping out as much crude as it possibly can at $140 a barrel. There are two reasons for this. Member
countries of course have a financial incentive to pump more at higher prices: Saudi Arabia alone earns more
than a billion dollars a day in oil revenue. For most OPEC countries, oil is their main source of revenue and if
there is one thing governments like, its revenue. But there is a more important reason. OPECs members
aren’t stable democratic countries in which petroleum is just another industry. They are mostly authoritarian
states that use oil as a means of sustaining political power. Oil money is a way of buying support from key
parts of society and financing a security apparatus to deal with enemies. Oil creates the revenues that enable
many OPEC regimes to continue to stay in power. By allowing countries to both buy authority and enforce it,
oil strengthens regimes that would otherwise be very wobbly. Nothing would be more destabilizing for the
Saudi monarchy or the Iranian theocracy than a fall in oil revenues. Would Hugo Chavez survive in
Venezuela without using cheap oil to buy off allies? Governments in Libya, Nigeria and Angola would
similarly all be in perilous political positions without the benefit of oil money. Far from being an economic
boogey man, the truth about OPEC is that it is a largely powerless organisation that sustains its own
existence with a myth, a myth that governments in the West are complicit in spreading. Like a peacock
that impresses with a great show of colour and noise, OPEC is really just a big bird that can’t fly.
Gonzaga Debate Institute 2008 103
Lacy/Symonds/Bowen R&B (Oil)
OPEC is near full capacity, doesn’t have the ability to flood the market
Mouwad, 2004
(John, September 13, “OPEC Finds Few Options to Put a Lid on Oil Prices”, New York Times,
http://www.nytimes.com/2004/09/13/business/worldbusiness/13oil.html
With crude oil setting a price record almost daily in August, the cartel tried to persuade the markets that
it was working overtime to step up supply. But with most of its 11 members already pumping at full
capacity, the promise had a hollow ring; traders shrugged, and crude prices climbed to within pennies of
$50 a barrel in New York before slipping back into the mid-$40's.
Though it has a third of the world's oil production, half of oil exports and three-quarters of known reserves,
OPEC is finding that its ability to influence prices has largely been exhausted, at least when it comes
to holding them down.
With most members producing all the oil they can, the oil ministers have few options to consider
when they meet in Vienna.
Gonzaga Debate Institute 2008 104
Lacy/Symonds/Bowen R&B (Oil)
Impossible for OPEC to flood the market – they don’t have enough oil
Washington Post ‘08
“OPEC Says Members Wont Pump More Oil” 4/6/08 http://www.washingtonpost.com/wp-
dyn/content/article/2008/03/05/AR2008030500500.html Accessed: 7/11/08
Despite a pledge by OPEC ministers to increase oil production, don't expect much of a break on oil
prices. With crude oil prices hitting a record $56 a barrel Wednesday, OPEC ministers meeting in Iran have
been grappling with a problem they haven’t confronted in the cartel’s 45-year history. In the past,
OPEC tried to cool overheated prices by pumping more when supplies got too tight. But most OPEC
producers say they’re already pumping as fast as they can. And despite the high cost of a barrel of crude,
world demand shows no signs of slowing.
To help stop the surge in prices, OPEC ministers agreed to pump an extra half million barrels of oil a day
beginning April 1. OPEC said it would consider pumping more later if the extra oil doesn't push prices lower.
But even before the decision was announced, some ministers had openly expressed doubts that the
move will do any good, saying they’ve run out of options in trying to rein in the price of crude. Global
oil demand has taken up most of the slack in extra OPEC capacity. Consumption is now believed by
many analysts to be pressing up against the limits of what the world can produce. Saudi Arabia is the
only country believed to have any surplus production left, and even then the Saudis are pumping close to 90
percent of capacity, according to the U.S. Department of Energy.
"There is not much we can do,” Algerian Oil Minister Chakib Khelil told reporters Tuesday in Isfahan,
Iran, the site of Wednesday’s meeting.
Gonzaga Debate Institute 2008 106
Lacy/Symonds/Bowen R&B (Oil)
Indonesia runs out of oil and many OPEC countries will follow suit.
Bloomberg 2008 (May 28, Indonesia pulls out of OPEC as it rapidly runs out of oil,
http://propagandapress.org/2008/05/28/indonesia-pulls-out-of-opec-as-it-rapidly-runs-out-of-oil/, accessed July 11,
2008)
May 28 (Bloomberg) — Indonesia, the only OPEC member in Southeast Asia, will pull out of the
group after aging fields and declining production force the region’s biggest economy to boost imports
as crude oil prices reached records.
Energy Minister Purnomo Yusgiantoro will sign a decree today to exit the Organization of Petroleum
Exporting Countries, he told reporters in Jakarta. The nation, a member since 1962, has been
considering leaving the body in the past three years.
Indonesia imports about a third of its oil because of inadequate refining capacity and faces falling output as
disputes with Exxon Mobil Corp. delayed field developments and deterred investments. The country’s oil
output has slumped 49 percent from a peak in 1977 while subsidies to cap domestic diesel and gasoline
prices may exceed $13 billion this year.
Gonzaga Debate Institute 2008 107
Lacy/Symonds/Bowen R&B (Oil)
Saudis are increasing oil production to help slow the soaring price of oil
Abbot, Associated Press Writer, 2008, (Sebastian, WTOP News, “Minister: Saudi Arabia can increase oil
production”, June 22, 2008, http://www.wtop.com/?nid=105&pid=0&sid=1426281&page=1, accessed on July 11,
2008)
JIDDAH, Saudi Arabia (AP) - Saudi Arabia is willing to produce more oil if customers need it, the
kingdom's oil minister said Sunday without citing any specific output increase. Saudi Arabia, the world's
largest oil exporter, has been under intense pressure from the U.S. and other oil consumers to increase
its crude output to help slow the soaring price of oil. The kingdom already announced modest increases
and said it would pump 9.7 million barrels a day beginning in July. But those increases have not done much
to stem the skyrocketing price of oil, which closed near $135 a barrel on Friday. The high prices are affecting
consumers and economies across the United States, Europe and much of the world. Many countries have
experienced social unrest as rising fuel prices have driven significant increases in the cost of food and other
basic goods. The cost of gasoline has also become a sore point in the U.S. presidential race, with President
Bush and Republican candidate John McCain calling for lifting of a long-standing ban on offshore oil and
gas drilling to increase domestic oil production. But Democratic candidate Barack Obama has said such steps
will do nothing in the short term to ease American consumer's pain. It was unclear if Oil Minister Ali al-
Naimi's remarks Sunday at a closed-door session during the high-level oil summit in the port city of Jiddah
would quell concerns. Al-Naimi, who was expected to formally make the announcements in a speech later
Sunday, reiterated his government's position that the recent run-up in prices has not been caused by a supply
shortage. But he said he also believes each country must do what it can "to alleviate these difficult
conditions." For the remainder of the year "Saudi Arabia is willing to produce additional barrels of crude
oil above and beyond the 9.7 million barrels per day which we plan to produce during the month of July, if
demand for such quantities materializes and our customers tell us they are needed," al-Naimi said in the
speech, a copy of which was obtained by The Associated Press in advance.
Gonzaga Debate Institute 2008 114
Lacy/Symonds/Bowen R&B (Oil)
OPEC won’t sell more oil – they’re afraid of the impact it will have on economies
Washington Post ‘08
“OPEC Says Members Wont Pump More Oil” 4/6/08 http://www.washingtonpost.com/wp-
dyn/content/article/2008/03/05/AR2008030500500.html Accessed: 7/11/08
The Organization of the Petroleum Exporting Countries yesterday decided to leave production
unchanged despite the high cost of crude oil, contributing to a $5-a-barrel leap to a new record price and
drawing a rebuke from a "disappointed" White House.
Saudi Oil Minister Ali al-Naimi said OPEC would also try to keep stockpiles near their five-year
average, a level many analysts think may be too low for comfort in a world of rising oil demand.
Though OPEC's production decision was widely expected, Naimi's comments and the wording of the group's
communique added to concern that OPEC is more worried about pumping too much oil for weakening
economies than it is about the possible harm that high oil prices might do to those economies.
In its statement after the meeting in Vienna, OPEC pointed to "the economic slowdown in the U.S.A., which,
together with the deepening credit crisis in financial markets, is increasing the downside risks for world
economic growth and, consequently, demand for crude oil." The cartel, which produces nearly 40 percent of
the world's petroleum, added that "the market is well-supplied, with current commercial oil stocks standing
above their five-year average."
Gonzaga Debate Institute 2008 117
Lacy/Symonds/Bowen R&B (Oil)
One million barrels a day would take six months and not all OPEC have spare capacity
Anson, 2007
(Stuart, The Sunday Times (London), “Opec’s capacity,” 12-23-07,
http://www.lexisnexis.com/us/lnacademic/results/docview/docview.do?
docLinkInd=true&risb=21_T4146209192&format=GNBFI&sort=RELEVANCE&startDocNo=1&resultsUrlKey=2
9_T4146209196&cisb=22_T4146209195&treeMax=true&treeWidth=0&csi=332263&docNo=10, accessed 07-11-
08)
Opec's capacity: I would question Irwin Stelzer's view on how much spare capacity Opec has ("Worried?
Blame the Chinese and the Arabs" December 9). Only Saudi Arabia seems to have spare capacity of 1m
barrels a day and that would take six months to ramp up.
Domestic demand in Saudi will rise by about 1m barrels a day within 10 years given economic and
population growth. And output from mature fields will decline.
Other leading Opec countries have no noticeable spare capacity (except Nigeria and Iraq, which are in
political turmoil). Iran, Kuwait, Venezuela, UAE, Angola, Libya are all fully producing and their expansion
projects are largely delayed by hugely increasing costs and overstretched contractors.
Gonzaga Debate Institute 2008 120
Lacy/Symonds/Bowen R&B (Oil)
Flooding the market has empirically done nothing to decrease oil prices
Elliott, economics editor, 2008
(Larry, The Guardian, “$135 and rising ... has cheap oil gone for ever?” May 24,
http://www.guardian.co.uk/business/2008/may/24/oil.commodities, Accessed on 7/11/08)
Turner said it was worrying that the markets ignored the Saudis' announcement that they would
pump an additional 300,000 barrels per day. "Saudi Arabia is struggling to stem a long term reversal
in production, and any offer to boost output raised the prospect of a steeper drop from 2009, when the
decline in global supplies is expected to accelerate. It is perhaps telling that futures prices have climbed
even more quickly than the spot market, underlining the very real fears of peak oil."
Gonzaga Debate Institute 2008 122
Lacy/Symonds/Bowen R&B (Oil)
OPEC has only a short period of time when it will still be in control of the market
Kingsdale, Journalist for Seeking Alpha, 2008
(Jim, Seeking Alpha, “The End of OPEC,” May 11th, http://seekingalpha.com/article/76725-the-end-of-opec
Acessed on 7/11/08)
I suspect the new Saudi fields being brought on this year and next will give them some ability to flood
the market with oil and lower the price temporarily if they choose to do so. But once that surge is over,
probably starting in 2010, there will be no ability of OPEC to influence the price of oil. In a Peak Oil
world, OPEC, by definition, will not be able to contain the rise in the price of oil; they simply will not
have the reserves to do so. Since we are either at or very near Peak Oil, OPEC is now or soon will be
quite powerless.