Once, many years ago in a distant land, Yamani the Enigmatic launched a great experiment. Without warning, he sent out a proclamation to every corner of the earth declaring the need to conserve energy. At first, people conserved little. But gradually, the pace quickened—only to slacken once again.
After six years and only modest progress, Yamani issued a second, stronger proclamation. This time, the world reacted dramatically. For the next six years, while the people of the earth multiplied and grew richer, their use of oil diminished—something never seen before. After twelve years, Yamani and his confederates, duly impressed with the power of their methods and the world’s response, withdrew their proclamations.
There matters rested for another eighteen years. Surprisingly, much of the world’s reaction continued, and by the end of the thirty-year experiment, the world had saved, by a most conservative estimate, eight times as much oil as it now uses in a year.*
The story is true. Yamani has retired, but his confederates have begun a second and more sophisticated experiment. Fortunately, the lessons of that first experiment, if properly applied, provide a path to escape the enormous costs that now await us if we fail to choose a secure and sustainable energy future.
Sheikh Ahmed Zaki Yamani, famous for his enigmatic sayings, was Saudi Arabia’s oil minister when OPEC, the Organization of Petroleum Exporting Countries, conducted its “great energy experiment.” The first “proclamation” led to the October 1973 oil shock, which tripled the price of oil. The second “proclamation” led to the 1979 oil shock, which doubled the price again.
While the worldwide response was enormous, the U.S. response was even more dramatic. U.S. addiction to oil decreased over a thirteen-year period, as did the country’s carbon dioxide (CO2) emissions. The United States conserved not just oil, but all kinds of energy. In the thirty years from 1973 through 2003, the United States saved energy equivalent to twenty years of U.S. oil consumption at the rate we now consume it.*
Carbonomics, the economics of fossil fuels, not only explains that astounding success, but also teaches us how to repeat it—but this time without paying OPEC another trillion dollars in tribute.
Yamani’s experiment did more to reduce CO2 emissions than the Kyoto Protocol has; there is simply no comparison. The experiment taught the world how to gain independence by saving energy, how to stabilize the climate by saving carbon, and how to increase security by reducing the world price of oil. By 1986, these lessons were fairly well understood, but OPEC had been crippled, and climate change was not yet a concern, so there was little motivation to act on the new understanding. As a result, nothing was done, and now the lessons are forgotten.
