The Oil Curse

This chapter outlines how international climate policies to reduce emissions may affect long-term demand and supply of oil. It discusses some central aspects of international climate policies and also discusses the relationship between cumulative emissions of CO₂ and the increase in global mean surface temperature. The chapter also outlines the conventional view of the future of oil demand in a world where climate change is not a major issue and analyzes how it may change in response to climate policies. It examines the alternatives to conventional oil, both fossil-based alternatives and renewable, as well as energy efficiency prospects, focusing mainly on the transport sector. The chapter also examines how Organization of Petroleum Exporting Countries (OPEC) and oil companies have approached the issue of climate change and also analyses how oil producers may be affected by climate policies. It focuses on how policies in the short term may affect the oil market.