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Tricky Oil Questions

Jun 17, 2012 • Behavioral Economics, Demand, Supply, and Markets, Developing Economies, Environment, Government, International Trade and Finance, Macroeconomic Measurement, Thinking Economically, Uncategorized • 190 Views    No Comments

1. Asked to list the world’s biggest oil consumers, most of us would be correct if we started with the US and China. With the US at 20.5% and China, 11.4% for 2011, we are almost at one-third of world consumption.

2. But then, it gets a bit tricky. Ranking the other big oil users, in which order would you place Brazil, Canada, Germany, Japan, India, the Russian Federation,  Saudi Arabia?

The answers:

  • Japan: 5%
  • India: 4%
  • Russian Federation: 3.4%
  • Saudi Arabia: 3.1%
  • Brazil: 3.0%
  • Germany: 2.6%
  • South Korea: 2.6%
  • Canada: 2.5%

Isn’t it surprising that Saudi Arabia ranks so high? And yet the reasons make sense. Because of subsidies, gas and electricity are very cheap, oil production uses a lot of energy and air conditioning. Yes, with a rapidly growing population, the demand for air conditioning is massive.

3. Finally, on a per capita basis, for 2010, who consumed the most oil: the US, China, Canada, Greece?

Answers: Canada is first and the US second. China was #9 and amazingly, Greece was #7 in the world (!!).

The trickiest question of all: Economists are still debating whether we have climbed Hubbert’s Peak–the point at which oil production is the highest it will ever go. Here, economist James Hamilton discusses the issue and here, econlife looks at it.

To read more about world oil consumption, this BP report has the most up-to-date information I could find while these Economist articles here and here also provide some insight.

 


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