INNOVATION, NATURE, WILL PROVIDE THE SOLUTION

The views expressed by Swaminathan S Anklesaria Aiyar on future oil price movements is highly exaggerated – ‘Start preparing for oil at $ 200 a barrel’ (TOI 07-02-10). The prices of all commodities in developing economies tend to raise for obvious reasons, including petroleum products. The movement of international oil prices are influenced by many factors, the prime mover apart from demand, is speculation. In 2008, oil was quoting at $ 147/barrel. If you factor average inflation in to that, in 2010, the price should have been around $ 165/barrel. The experts, at that time, predicted oil would touch $ 200/barrel in a year time. However, in 2010 it is quoting around $70/barrel, inspite of emerging economies recording robust GDP growth during 2008-2010. Comparing the decontrol of steel with that of oil products is not appropriate. Steel is not a product used by every one 24/hrs a day, like petrol, diesel, kerosene and coking gas. We are a country with huge poor and middle class families. Decontrol of petroleum products will hurt them very hard. Under-recoveries are a problem, which the government should tackle in different way without increasing the burden on the middle class, poor and other oppressed sections of the society. The energy crunch should be addressed by encouraging renewable sources of energy like solar and wind energy. Innovation, technological break and/or nature will provide the solution to the problem of energy crunch. Who imagined, five decades ago, that Information Technology and Internet would revolutionize the world as it is today? There is no need to press the panic button unnecessarily.