The market finds a way
By Scott Sumner
Experts often warn that we are soon going to run out of a natural resource. If so, then we might expect an increase in price, which encourages conservation. In many cases, however, that price increase unleashes a new and unforeseen alternative supply. Consider the fishing industry, which used to rely on fish caught in the ocean:
Notice that ocean caught fish peaked in the mid-1990s, and all the new supply has been coming from aquaculture.
Here’s the global oil industry:
Notice that conventional oil production peaked around 2011, and all the new growth in demand is being filled by unconventional oil sources (mostly fracking.) Further back in history, whale oil was the “conventional oil” and underground petroleum was “unconventional”.