Chinese Oil, Chinese Problem?

Just kidding - their isn't much Chinese oil. But I did see another in a long line of "How will China fuel one billion cars?" articles - short answer, as I've discussed here before, is they won't. I was, however, disappointed in the BBC's writers for this quote:

In 2004, its thirst grew by 15%, while its output only rose 2%. "They have a problem," says Philip Andrews-Speed, an energy analyst at Dundee University and former BP China executive. [emphasis mine]

No, Mr. Andrews-Speed, we have a problem. Let's walk through this very slowly:

1. China's demand for oil is growing. Fast. Nobody else is decreasing their production in a similar fashion, so we can say that global demand is increasing with China's.
   
2. Global supply of oil is static, or even shrinking.
   
3. The price of oil will do what, exactly, in this scenario? (If you say anything other than "increase" in response to this question, Mr. Andrews-Speed, roll up a newspaper and hit yourself on the nose. Then, mash your face in to the monitor while shouting "No! Bad analyst!!")

Which brings me to an article in this month's American Scientist. Sadly, the article isn't online, but it deals with fuel efficiency gains and their probable impact on the American economy. The short story is exactly what you'd think - it's all gravy, baby. Efficiency gains have a net positive impact on the American economy, increasing jobs and saving money.

However, there's a problem. Even with the most "advanced" incremental mileage savings the study considered, efficiency can only hold the national consumption of oil steady at the current level. The study's "moderate" scenario still sees an increase in oil consumption, albeit a smaller one than the baseline scenario.

This shows the inherent weakness in letting the automobile companies apply incremental changes to their designs - even if we assume that Detroit is putting it's best in to making fuel-efficient cars -

(pause for audience to stop laughing)

- incremental fuel efficiency improvements aren't enough. We need revolutionary, transformative change. This is why we need solutions like plug-in hybrid cars now*. This is the kind of change only the government can drive. Actually, the government could have driven this change 20 years ago, but the Americans re-elected this actor guy back then, you might remember. One of Reagan's most damaging policies (long-term) was to gut the CAFE fuel efficiency standards. Hence, the modern American car market, where the 2000 Ford Explorer gets worse mileage than the Model T. Seriously.

*Just to reiterate some of the math on plug-ins, most (50%) people do not drive more than 20 miles in a day. The large majority (85%) do not drive more than 40. Making a car that could drive 40 miles on batteries without turning on it's internal-combustion engine therefore saves huge amounts of oil - though that energy needs to be made up in electrical generation. If the internal-combustion side of the hybrid is fueled with an alcohol blend, than a flexibly fueled, plug-in hybrid could probably save upwards of 90% of the usual oil consumption.The two major caveats remain, however:

1. If the electricity that powers these plug-ins is made from coal, oil, or natural gas, we don't gain anything in terms of fighting global warming. Boy, I suppose I have to start adding hydroelectricity to that list. The corrolary to this point is that if the ethanol or methanol which fuels the car is made from oil or coal, we also lose.
   
2. It takes more than a decade to turn over a fleet of cars in a given nation. We're already behind. Even starting today, it would be somewhere between 2015-2020 before we saw the last "legacy" cars retired from the fleet.