Contemporary Economic Policy Essay Example | Topics and Well Written Essays - 4750 words

Contemporary Economic Policy - Essay Example What is needed is not less than an energy revolution itself. This World Energy Outlook demonstrates how that might be achieved through decisive policy action and at what cost. It also describes the consequences of failure. Take oil for example, which is the world's essential supply of energy and will remain so for many years to come, even under the most optimistic of assumptions about the pace of growth and exploitation of alternative technology. But the sources of oil to meet rising demand, the cost of producing Oil and the prices that consumers will need to pay for it are extremely uncertain and constantly fluctuating, perhaps more than ever. The surge in prices in recent years drastically ending in the price spike of 2008, joined with much greater short-term price instability, have highlighted just how sensitive prices are to short-term market imbalances. They have also alerted people to the ultimately finite nature of oil (and natural gas) resources. In fact, the immediate risk to supply is not one of a lack of global resources, but rather a lack of investment where it is needed. Upstream investment has been rising rapidly in nominal terms, but much of the augmentation is due to heaving costs and the need to battle rising decline rates - especially in higher-cost provinces outside of OPEC. Today, most capital goes to exploring for and developing high-cost reserves, partly because of limitations on international oil company access to the cheapest resources. Expanding production in the lowest-cost countries will be central to meeting the world's needs at reasonable cost in the face of dwindling resources in most parts of the world and accelerating decline rates everywhere. 1. Introduction: The United Kingdom has been a net importer of energy resources (Oil and Gas) the energy sector itself has a big chunk in the over-all economy of the nation. However with the ever fluctuating and unpredictable fuel prices, it does not seem like a feasible approach to depend on traditional energy resources. A better and more mature energy policy needs to be prepared and implemented. The purpose of this paper is to highlight key energy consumption trends in the UK, review the energy policy and come up with a better approach towards dealing with the economic impact of energy. The energy industries in the UK play an innermost role in the economy by producing, transforming and supplying energy in its various forms to all sectors. They are also major contributors to the UK's balance of payments through the exports of crude oil and oil products (National Statistics Publication 2007). i) 4.8 per cent of GDP; ii) 8.6 per cent of total investment; iii) 44.3 per cent of industrial investment; iv) 137,800 people directly employed (5 per cent of indus