NAPIONAB CaeCe) ae : Aspecialreport — ah public interestNATIONAL SPECIAL REPORT GEOGRAPHIC FEBRUARY 198! The unbalanced world ORE THAN a year ago the editors of NATIONAL GeoGRaPHic became concerned that while advocates and detractors of oil, coal, and syntuels, nuclear, solar, and wind powercompeted in the daily ere were few readily available sum- ituation. A large staff under Science Editor Kenneth F. Weaver has assembled such a picture in the hopethat ‘it will help inform the public During the year things did not improve We still have no national energy policy. Energy prices are still inflating others. And Mr. Weaver's scenario of the consequences of a future Middle East breakdown is under- scored hy the present Iraqi-Iranian conflict Events in the United States, however, are only-a part of basic changes in the fragile in- ‘ternational order of things. Since 1945 world events have been controlled hy the balance between the two superpowers, the United States and the Say Union, and the re sponse of the Third World to their actions. That pattern was broken with the emer- gence from the Third World of a privileged group, the relatively few oil-producing na- tions that hold the economic health of indus- trialized societies in their hands and cater to neither Moscow nor Washington. And a Fourth World has emerged, that of ith no chance whatever to educate, house, care for, or fully employ their teeming populations, Rising energy costs have deprived them of reaching even the minimums in this century A World Bank official estimates that the cost of providing minimum-level nutrition, water, shelter, and energy to more than two billion people in the poor nations of the world will bea hundred billion dollarsayear for the next ten years—and 40 percent of that huge cost will be for energy One way or another, the United States and other “have" nations, who use most of the world’s energy, will devise stratagems to ive. But for much of the world, govern ments caught in the crunch between huge balance-nf-payments deficits and sinking living standards will find it difficult to re- main stable, much less prosper. ‘A chief problem facing the new admini tration in Washington is devising an energy policy that encourages American economic growth while coming to grips with the inter national economic balances that are being so radically altered by the pressures of energy cost and social unrest. We wish our new leaders luck in this most difficult task. bllct biboswere the very poor, v CONTENTS 2 Ourenergy predicament By Kenneth F. Weaver auto mania ry, phetographs by Bruce Dale Americ: By David Jeffe Can we live better on less? By Rick Gore Anatlas of energy resources ye What six experts say 74 Synfuels: Fill “erup! With what? ‘By Thomas ¥. Canby and Jonathan Blair o6 New energy frontier By Bill Richards and Louie Psihoyos 14 Energy source book 113 Editor’s postscript COVER: Tar-sands plant in Alberta: night photo by Jonathan Blair, colar-enkanced by Rex A, StuckyAMERICA'S THIRST FOR IMPORTED OIL Our Energy Predicament 1973 Crude oil ina fine Waterford crystal pitcher symbolized the rising price of petroleum when the GEOGRAPHIC photographed a smiling Kuwaiti for the June L974 article that warned of imminent oil shortages. 1980 In seven years the world market price for crude had soared from $ to more than $32 a barrel. World supplies were threatened as the war between Iraq and Tran dragged on, 1985 Conservative timates project a price of $80 a barrel, even if peace is restored to the Persian Gulf and an uncertain stability maintained. By KENNETH F. WEAVER‘T IS THE SUMM upris ROF 1983. Violent sy have shak: Tl House of Sa hs then . which once alf a dozen t lay dow ian Gulf and o e global « chin, oil sup- un raconserva abi sect, ange © of the ruling brief tin not to feel the Arabia rels, and strat Oil no longer flows from rich Saudi fields have destroyee complacen nts of the oif distribution glut of 1980, which cushioned Critical elemJosses at the outbreak of the Iraqi-Iranian war, has long since evaporated. Bid up by the worst panic buying in history, prices on the spot market in Rotterdam are skyrocket- ing—$80, $100 a barre (sce definition in glossary of energy terms, page 23). Official pricesof the oil cartel are heading for similar levels, if more slowly The 2!-nation International Energy ‘Agency has called on its members to fuliill an agreement signed in 1975; In the event of a major cutoff, they are to share their oil, Honoring that promise is costing the United States nearly three million bartels a day ad- ditional, for Western Europe and Japan are far more heavily hit than we are. Our total lossis now more than half the oil we were im- porting before the Saudi collapse. It equals more than half of all the oil consumed by our 160 million motor vehicles. Domestically the effects are disastrous. Critical gasoline shortages have brought endless lines at filling stations, even though prices have reached painful levels, Violence frequently erupts when the pumps reach empty, and thefts from gas tanks are epi- demic. The President has invoked the gasoline-rationing plan passed in 1980, but itwill be months getting into operation. Meanwhile, transportation is hamstrung; we are far short of the 110 billion gallons of motor fuel we are accustomed to burning each year. Many workers cannot get to their jobs; productivity drops. Businesses depen- dent on gasoline, such as shopping centers, resorts, motels, are suffering hea All economic indicators are flying red flags. Unemployment has already climbed a million. ‘The stock market drops daily. In- flation has passed 30 percent And all for the want of imported oil. HAT YOU HAVE JUST READis. of Warsow: may juggle the details, but many ex- perts believe that something similar is al- most certain to happen somewhere in the Persian Gulf within thenextfewyears. Even as thisis written, the bitter struggle between Traq and Iran threatens to trigger all kinds of explosive disruptions in the Middle East. ‘Think back on the trauma of the gasoline lines following the Arab of embargo of 1973+74-and the Iranian revolution in 1979 4 The losses were puny then compared to a cutoff of Saudi Arabian oi] or—worse yet— all Persian Gulf oil. Vet the impact on American motorists is still a vivid and un- pleasant memory, And the embargo, which lasted only six months, helped trigger the worst U, S, recession in 40 years. The simple truth is that the United ‘States—and most of the rest of the world— hasan insatiable thirst for petroleum. “This unbridled appetite has left us vulner- ‘ably dependent on some of the most politi- cally unstable parts of the world, bristling nt feuds, religious hatreds, and ambitions. Sizable amounts of our petroleum—called “hostile oil"—come from Libya and Algeria, neither of which bears any love for the United States, At any moment, as we have seen three times in less than a decade, war or revolution or political action in the oil-producing states can ab- ruptly cut off shipments of vital importance tothe West. As London energy analyst Jonathan P. Stern sums it up: “Western vulnerability is such that any destabilizing force that even remotely threatens cil production sends massive shock waves through the industrial world. So delicate is the balance of the world oil supply that the cessation of supplies from even a minor producing country for a comparativ ort... time. . causes major dislocations in supply and price.” OW DID WE GET ourselves into this The answeris clear. Of all the com- mon fuels, oil is the most portable, the most convenient for transportation, the most ver- satile. It has seemed endlessly abundant. Above all, it was—until recently—eheap Only adeeade ago crude oil sald for less than two dollars barrel. And.so we became addicted to oil, We built. a way of life around it. Our love affair with the automobile has been possible be- cause of it. Last year just under half of our energy needs were provided by oil. But since late in 1947, when the United States became a net importer of oil, our own production has not been enough to sustain this life-style. Over the years, as demand in- creased, the imbalance has grown steadily worse. {Continued on page 16)