Alternate fuel sources will drive competition in the near future, thanks to escalating oil price

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Alternate fuel sources will drive competition in the near future, thanks to escalating oil price

By Greentech Lead America: The Fuel Freedom
Foundation, a nonpartisan, nonprofit organization, said that markets
should be urgently opened to competition from alternative fuels such as natural
gas, ethanol, methanol and electricity as the International Monetary Fund warns
that oil prices could permanently double in the next
decade.    

“The IMF report warns that a doubling in oil prices will
send the global economy into ‘uncharted territory, which would spell disaster.
Fortunately, disaster can be averted if we open our markets to competition from
cheaper, cleaner, American-made alternative fuels to gasoline. This is the only
way to bring down oil prices significantly and structurally, and ensure future
economic growth,” said Joseph A. Cannon, president of the Fuel Freedom
Foundation.  

The IMF report predicts that the consumption of finite
resources will push prices ever higher. On the other hand, the higher prices
will spur new methods for extracting oil, as well as substitutions for
petroleum products. These advances, in turn, will lead to greater output and eventually
lower prices.

The report concluded that geological constraints on
production, plus “demand shocks” such as rapid growth in China and India, best
explain the trend in oil prices. At the same time, the researchers found limits
to the impact of technological advances in the long run. The result is a near
doubling in oil prices, and a “pain barrier” beyond which there is lasting
damage to economic growth.

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