Conclusion

Abstract

The extraction/processing of the Canadian oil sands is predominately a political phenomenon, and less so an economic one. This is evident in three specific ways. First, the demand that is now existent for the oil sands results directly from the historically profligate oil use on the part of the United States (i.e., urban sprawl). (As I show in Chapters 4 and 5, urban sprawl in the United States is itself a political phenomenon.) US oil consumption has played a huge role in the disappearance of so-called easy oil—with America annually consuming 20 to 25 percent of world petroleum production. The International Energy Agency (IEA) in 2010 declared that conventional petroleum production peaked in 2006.¹ With conventional oil extraction seemingly declining, “hard” petroleum, such as the oil sands, oil shale, deepwater petroleum (e.g., in the Gulf of Mexico), and the like, becomes economically feasible. Moreover, continuing massive consumption of gasoline/oil by the United States creates an economic environment favorable to producing oil from the tar sands, and other unconventional petroleum sources (as well as difficult to reach pools of crude—e.g., Arctic Ocean oil²). (Higher production/processing costs for “hard” oil means that the cost of a barrel of petroleum must be above a certain price point [e.g., $50] to be able to bring these energy sources profitably to market.³)