02-Sep-12

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Creator

Subhrajyoti Mandal
Neil McMahon, Oil Analyst, Stanford C. Bernstein

There is no easy oil left in the world, geologists are basically scarring the parts of the planet where nobody really goes to and search for the last remaining sizeable oil reserves.

Human civilization has experienced the fastest rate of economic growth during the last two centuries, precisely over the latter half of twentieth century. Since the beginning of the past century, usage of mineral oil and other petroleum based products has emerged as the primary source to fuel the growth of the economy. But human beings have mostly depleted the natural reserves that have been developed over millions of years in just two centuries. The bitter truth is being a non renewable resource the oil sources are dwindling all across the world. For this the need of reservation is now greater than ever before. What can be the role of reservation of natural resources in macro economical aspects? In a financial analysis the reserves always come under the liabilities side. And if we take the GDP as the benchmark for country based economic development then resource reservation will indirectly belong to the investment section. Hence roughly blending the above two prospects its a liability for us to invest for a better future for the coming generations. The definition of youth One of the common notions of categorizing the populace is in terms of demographics. In that one standard parameter is age, like children, youth, middle-aged, senior citizen etc. Its difficult to appertain to a distinct age boundary, still across the globe the age category from 15 to 24 (in some cases 29) can be considered as youth. I beg to differ with such kind of parametric definition. Youth is not a condition of the body neither it can be quantified by the number of years a person has lived its a state of the mind. Youthfulness lies in the freshness and vigor in work, innovation of new ideas, constantly challenging the old obsolete practices and adapting to modern sustainable methods. If a person have similar attributes at an age of eighty then he/she belongs to the youth category and the converse is also true. Oil consumption in the world The worlds oil consumption can be broadly divided into three categories for infrastructure development and public utilities purposes, for transportation & private consumption and for other

Comment [u1]: May elaborate can shift to the ending.

Comment [u2]: concise

areas like R&D, defense applications etc. The first and the third sector cannot reduce their oil consumption for obvious reasons. So for reservation the cut down must be done in areas of transport and private consumption. However for all the sectors more efficient methods of usage must be adopted so that consumption can be optimized for maximum benefit of the populace. Today the well being of worlds population is highly dependent on developing countries mostly India and China. These two countries constitute almost half of the worlds population, but their contribution to oil production is not very high. Yet for justifiable reasons their oil consumption is enormous and still increasing, otherwise the economic growth in these countries will be hampered. Among the developing countries India has secured a special position because we have the youngest workforce among the large economies, which even China doesnt have. Now the main question arises how come the forever increasing private consumption (precisely among youths) be tamed, and what can be the role of youths in this matter? Its now not a question of awareness but a matter of changing daily habits and lifestyle, which are both individual and societal responsibilities. If some practices can be embedded within the lifestyle in the early years then evidently that will be sustained for a lifetime. Therefore its high time for the youth to understand their future roles and responsibilities in terms of energy conservation. Oil in India: The present scenario India produces about 878000 bbl/day (barrels per day) of crude oil (as per the CIA world factbook, data is correct as of January 2011). But Indias oil consumption is much higher 2980000 bbl/day (4th largest in the world). Therefore India is the fifth largest importer of crude oil in world (daily imports are about 2900000 bbl/day). From 2001 to 2009 our daily oil consumption has increased by 38% (from 2.1 million barrels to 2.9 million barrels), whereas the production has increased by only 25% (0.72 million barrels to 0.9 million barrels). Indian proved reserves of petroleum is not very promising; also total unexplored area has been reduced to 30% at present from 50% in 1995-96. With most of all the easy extraction fields depleted across the globe, the recovery process is getting complex and more and more expensive day by day. Hence the crude oil prices will only increase in the near future. Our only option is to promote oil reservation to cope up with oil shocks and growing domestic demands. The reason behind Indias large current account deficit is the growing oil import bill. Between January and October 2010, India imported $82.1 billion worth of crude oil, which is about 70% of its total usage. During the next decade the oil consumption is expected to grow at a rate of 3.5% per annum. To sustain the recent economic growth, India needs to be energy independent within the next 25 years.

Comment [u3]: Get data

Comment [u4]: http://www.indexmundi.com/in dia/oil_production.html

Comment [u5]: http://www.indiaenergyportal.o rg/subthemes_link.php?themeid=9&text=pet_natur al

Comment [u6]: http://www.businessweek.com/ news/2010-12-07/rupee-rally-falters-as-oil-rises-totwo-year-high-india-credit.html

Transport Transport is largest sector of oil consumption and this is the sector where most of the youths are directly involved. Many members of generation Y are either college/university students or office-goers. They own individual two wheeler or four wheeler cars for reaching their destined institutions or workplaces. This is an area where they can reduce their individual consumptions. For transportation

Comment [u7]: Try to get statistics

they can use share carriages like buses, pull-cars and more preferably the greener ones such as trams, trains and metros. This will not only promote oil conservation but also reduce the problems like air pollution and traffic congestion in metropolitans. It will be a little difficult to start with but it has financial benefits also, a college student who travels 10 KM to his college on a motorbike can save Rs 2030 on a daily basis if he starts travelling by bus or even more if he chooses train. A monthly addition of Rs 600-1000 to his/her pocket money wont seem to bad for a middle class boy/girl. For short distances bicycle is a very good medium of transport. Not only it is of negligible cost but also bicycling has added health benefits. Even if vehicles are used correct driving practice must be adopted by the youths sudden speeding, breaking, clutch riding, overloading should be avoided. Also the vehicles must be regularly serviced and checked for emission controls. Two micro problems may arise one is surely of time, the younger generation loves speed and self dependency which is associated with usage of personal vehicles. The issue of time can be addressed with better time management and adopting a more efficient lifestyle. Another problem is the social status issues, like a student who carries a sporty bike or a luxury car in the college campus becomes an instant hit among the friend circles, he/she may not like to change his/her point of view so easily. In modern workplaces its a matter of disgrace if a middle or high ranked employee arrives in a bicycle. These are all awareness issues and have to be addressed by campaigns and programs. If a sizeable number of young employees resort to other mediums of transport like walking or bicycling then the issue of social disgrace can be done away with. The offices will also save the area reserved for parking spaces and can utilize it for better means.

Usage of alternative products as fuel Its a known fact that alcohols can be used as fuels for vehicles. Methanol and Ethanol has almost same octane rating as Gasoline (Average Motor octane rating of 85-90 in Alcohols compared to 95-110 in gasoline) and can be used as car fuels, they also contribute much less to air pollution hence can be considered as cleaner fuels, also has some other benefits like low volatility, lesser contaminative effects of the engine's exhaust fumes, better engine performance etc. Countries like Brazil has revolutionized the concept of using ethanol as fuel, Gasoline sold in Brazil contains at least 25% anhydrous ethanol (made from sugar).The problem in India are the prices and the low and restrictive production of alcohol which is largely oriented for wine industry. The role of the youths comes here a sizable amount of alcohol consumption is done by the younger generation. The percentage of the drinking population aged under 21 years has increased from 2% to
more than 14% in the past 15 years, according to studies in the southern state of Kerala by Alcohol and Drugs Information Centre India (an NGO). If that amount can be reduced significantly then the excess
Comment [u9]: http://www.thelancet.com/jour nals/lancet/article/PIIS0140-6736(08)61939X/fulltext

Comment [u8]: Wiki, http://en.wikipedia.org/wiki/Octane_rating

alcohol can be used as bio-fuel. Also surplus in that product category will bring down the fuel prices. Not only alcohol, various other options are now available like bio-diesel, hydrogen powered or electricity powered pollution free cars etc. Its the duty of the youths to create awareness among the masses for this renewable alternative for fossil fuel. The Society for Indian Automobile Manufacturers (SIAM) has

confirmed the acceptance for use of 5% ethanol-doped-petrol in vehicles. State Governments of major sugar producing States and the representatives of sugar/distillery industries have confirmed availability / capacity to produce ethanol. The automobile companies must also promote the use of flexible fuel engines in vehicles and make the machineries suitable for using different fuel combinations. But ultimately the production decision is dependent upon end users so the youths if they opt to own a car, must give preference to flexible fuel vehicles. Also vigorous campaign must be taken by the youths to reduce alcohol consumption in schools, campaigns and workplaces for the associated health concerns as well as this issue of oil conservation.

Other important areas To use oil products more efficiently we need to constantly develop and modify the production and consumption methods. Currently India is lacking involvement of the generation Y in areas of R&D. India has the largest number of Science Graduates and Engineers in the world still very few of them join the R&D sector. Even among those very few candidates many (and the brightest ones) leave for abroad to join foreign research projects when their country needs them most. Its a matter of national shame and stigma. This attitude has to be changed by increasing awareness among the youths about the importance of research and development for the wholesome development of the country. Due to our rapid economic growth the energy consumption has increased at the rate of 3.6% per annum over the past 30 years. Today India produces 18906.1 MW of thermal power directly from oil and gas based power plants (overall around 11% of the total power production). Even in coal based power plants a significant amount of furnace oil and natural gas is required for efficient production. So considerate use of electricity should also reduce overall oil requirement in this sector. Generation Y must do it through changing their lifestyle a bit. Energy consumption can be reduced in many ways reduced no of parties and long drives with friends, less nightouts and effective use of daylight for work and studies, promoting the concepts of using fluorescent lamps instead of incandescent bulbs and many more ideas can be heralded by the younger generation to reduce electricity consumption and help in oil reservation indirectly. Adopt a healthy lifestyle not too much party and late night studies use daylight as much as possible electricity production uses fossil fuel (diesel). Use social media it had success in anti smoking and tiger reservation issues. Students can save a lot of their pocket money by avoiding two wheelers/4 wheelers. Reusing and recycling many products may introduce less energy consumption. Usage of alternative products

Comment [u10]: Modify the whole para

Using ethyl alcohol as fuel so reduce alcohol consumption so that the excess alcohol can be used as fuel. Methanol and Ethanol has almost same octane rating as Gasoline (Average Motor octane rating of 85-90 in Alcohols compared to 95-110 in gasoline) and can be used as car fuels, they also contribute much less to air pollution hence can be considered as cleaner fuels, also has some other benefits like low volatility, lesser contaminative effects of the engine's exhaust fumes, better engine performance etc. Countries like Brazil has revolutionized the concept of using ethanol as fuel, Gasoline sold in Brazil contains at least 25% anhydrous ethanol (made from sugar).The problem in India are the prices and the low and restrictive production of alcohol which is largely oriented for wine industry. The role of the youths comes here a sizable amount of alcohol consumption is done by the younger generation. The percentage of the drinking population aged under 21 years has increased from 2% to
more than 14% in the past 15 years, according to studies in the southern state of Kerala by Alcohol and Drugs Information Centre India, a non-governmental organisation (NGO). If that amount can be reduced

Comment [u11]: Wiki, http://en.wikipedia.org/wiki/Octane_rating

significantly then the excess alcohol can be used as bio-fuel. Also surplus in that product will bring down the fuel prices. The automobile companies must also promote the use of flexible fuel engines in vehicles and make the machineries suitable for using different fuel combinations. But ultimately the production decision is dependent upon end users so the youths if they opt to own a car, must give preference to flexible fuel vehicles. Also vigorous campaign must be taken by the youths to reduce alcohol consumption in schools, campaigns and workplaces. The Society for Indian Automobile Manufacturers (SIAM) has confirmed the acceptance for use of 5% ethanol-doped-petrol in vehicles. State Governments of major sugar producing States and the representatives of sugar/distillery industries have confirmed availability / capacity to produce ethanol.

Comment [u12]: http://www.thelancet.com/jou rnals/lancet/article/PIIS0140-6736(08)61939X/fulltext

Monopolistic competition of oil companies theoretically the demand is so high they may charge anything for petroleum products. One method can be forced reduction of demand by curbing the private consumption reduced demands will force the oil companies to bring down the petroleum product prices. Transport is the sector which has the largest share of oil consumption (more than 50%).