Getting past its peak or will it be ‘oil right on the night’?
February 1st 2010 A group of British businessmen, known as the UK Peak Oil Task Force, is warning that oil supplies could dwindle much more rapidly than many realise (see news story on Page 6).
This could have massive implications not just for the logistics industry but for society as a whole.What makes the report stand out is that this isn’t a bunch of tie-dye wearing tree huggers carping from the sidelines.When a report produced by world-renowned firms such as Virgin and Arup say a crippling energy crisis is a real possibility, then businesses need to sit up and take notice.
The latest report of the task force warns oil shortages, insecurity of supply and price volatility could cause widespread disruption in the UK as early as 2015, in other words within the term of the next Government.
Indeed, the task force convenor, Jermey Leggett, argues we could see an oil crunch that leads to “food delivery lorries failing to reach Tesco in time for Friday-night shopping”.
That said, a cynic would note that some of the companies behind the report are electricity firms. In addition, oil giants such as BP have been dismissive of the ‘oil crunch’. There is plenty of oil says the petroleum giant with more being discovered every year and it predicts demand will peak before supply, sometime after 2020.
So who is right? Its hard to call but perhaps it pays to err on the side of caution. The UK can ill-afford to be side-swiped by another crisis on the scale of the recent financial meltdown. The financial industry was the last to notice something was going wrong with the financial system, or admit there was a crisis - at least until it was too late.We should not expect the oil industry to flag up potential problems in advance.
The logistics industry is more vulnerable than most to rising oil prices, so if this comes to pass - what can be done?
In the warehouse, we may see hybrid technology given greater incentives to wean lift trucks off oil-based fuel, but this will be small beer against the fuel used by distribution fleets.
With the Renewable Transport Fuel Obligation (RTFO), biofuel is on the agenda, with a 10% renewable fuel level required under the RTFO by 2020. However, it remains to be seen if it will have a big impact on oil consumption.
The lustre of biofuel has been tarnished somewhat in recent years on environmental grounds, with critics arguing that increasing land being devoted to crops for fuel has pushed up food prices and led to deforestation. This means the public must be won over before the potential of biofuel can be realised.
As well as examining fuel itself, the industry could also be forced to look at truck utilisation. Perhaps, if oil prices rise sharply enough, the Government will regulate on minimum utilisation limits on trucks. For example, 90 per cent or more per trip. This will certainly save fuel, but would create all manner of headache for the industry.
Simon Duddy, Editor More articles from Handling & Storage Solutions: | 
