The oil and gas industry should listen closely to Gro Harlem Brundtland, Norway's prime minister. Her declarations on energy effectively catalog the high-minded wrong-headedness that lies behind most political threats to the world's most important fuels.

Brundtland's arguments lie at the base of the cases against oil and for government control of markets. And the way she folds questionable opinions into assertions, as though they were established fact, says much about the intellectual atmosphere surrounding the politics of energy.

NEW MEANS OF GOVERNANCE

"Governments must develop new means of governance," Brundtland declared in May at the World Petroleum Conference in Stavanger, because reliance on market forces to allocate resources alone is "clearly insufficient." Says who? History shows that the world fares best when markets, not governments, allocate resources.

Brundtland used the ploy again last month at the Offshore Northern Seas conference in Stavanger. "Environmental challenges have for a long time called for more prudent use of fossil fuels," she said. Then: "It is dear that the depletion of limited energy resources cannot continue at today's rates." Clear to whom? And what's the connection between depletion and environmental challenges? It was in just such logical quicksand that former U.S. President Jimmy Carter founded his many failures of energy policy.

"...We know that we must change the existing pattern towards more environmentally benign energies to achieve sustainable development," Brundtland went on. Who is "we," anyway--the bureaucrats who would declare what's "environmentally benign" and what's not? "We know that we cannot continue to perpetuate our present production and consumption patterns," Brundtland confessed on behalf of the masses, leading to this: "I believe that a form of market management is necessary to avoid excessive price volatility in the future and secure the long term security of supply." At least she didn't attribute that clinker to the indistinct "we."

Brundtland's pronouncements highlight three presumptions that the industry must challenge whenever they appear.

One is the strange notion that depleting finite resources is inherently wrong. In fact, resources have no value until produced and consumed. As long as markets govern production, consumption, and prices, the process will unfold in the most efficient way. Yes, the world is depleting a finite resource. The limit on that resource happens to be nowhere in view. When the resource rather than production capacity begins to limit supply--and no one yet knows when that will happen--prices of fossil fuels will rise and renewables, about which Brundtland and others express such enthusiasm, will begin to make economic sense.

Another presumption is that current patterns of oil and gas consumption will spoil the environment. This unfairly ignores past and future technical improvements and investments aimed at reducing the degrees to which oil and gas pollute.

ASSERTING CONCLUSIONS

The last presumption is that contrary views don't matter. By asserting her conclusions in the ways cited above, the prime minister tries to exclude dissent and frame debate to suit her agenda-high on which is creation of an international network of governments to select fuels and set prices. What Brundtland may see as a "clear' need looks from here like statist mischief certain to hurt energy users and economies.

Ideas like Brundtland's about energy can do great harm. The best antidotes for them are ideas that make better sense, expressed clearly, forcefully, and often.

Copyright 1994 Oil & Gas Journal. All Rights Reserved.