Chevron CEO O'Reilly says, love it or hate it - the world is going to keep running on oil for a long, long time. I think he's old school and may be like a one of those guys in the early 1900s, perhaps a CEO of a company that made horse drawn buggies, who couldn't foresee the enormous changes coming in that century, as early as the 20s and 30s. You know ... cars, planes, etc.Still, you have to admit he's got a great vantage from which to view the global economy and energy markets, even if his big oil CEO cap is screwed on a little too tight. And it bothers me to hear him say this about the mega-freaking-enormous size of current and ever-expanding energy demand. In an interview last week, when asked "Will oil become less important in the future?" Reilly said:
The scale of the energy system is enormous. Forty thousand gallons of oil are consumed every second, and that represents only one-third of the total global energy system. To significantly change the energy mix is a big challenge, and I don't think it's likely to occur anytime soon. Very long term, a century out, maybe 50 years out, with new technology and changes in the capital structure - maybe some changes will occur. But in the next 25 years, it's unlikely there will be significant change.
Here's his full interview from the November 28, 2007 edition of Fortune magazine. I think he's correct for this moment. And maybe for the rest of this decade. But he's not allowing for innovation and the tremendous breakthroughs we're going to see with so many good minds (backed by increasingly large sums of funding) trained on this problem. I really hope he's not right for much longer.