Alexander is an academic who specializes in environmental issues, and is closely with the Simplicity Institute (based in Australia) in which this article was originally published in PDF format. In this rather lengthy, scholarly, and very important essay he analyses the paradox contained in the title by examining the interplay of economic, environmental, and geopolitical factors.
The main conclusion defended below is that so-called ‘cheap oil’ (at ~$50 per barrel) is just as problematic as expensive oil (at $100+ per barrel), but for very different social, political, economic, and environmental reasons. Just as expensive oil suffocates industrial economies that are dependent on cheap energy inputs to function, cheap oil merely propagates and further entrenches the existing order of global capitalism that is in the process of growing itself to death.It is clear that he is much more informed about the economic and environmental factors than he is about geopolitical factors. Thus, he devotes much more space to the former. However, he does make this one telling comment about the current geopolitical situation:
Perhaps most importantly, with cheap oil Saudi Arabia is able to punish or put pressure on some of its (and the US’s) geopolitical enemies, including Iran and Russia – two oil exporters that are much harder hit by $50 oil than the wealthier Saudi Arabia .... As of early 2015, the Russian economy seems particularly weak and unstable, and there is some speculation that the US has colluded with Saudi Arabia to flood the markets for this very purpose ..., even if this hurts US shale producers. In fact, some analysts argue with plausibility that oil markets, in our neoliberal era, provide a means for the US government and the broader ‘Transnational Elite’ to insidiously wage economic war, especially against Russia .... It is very difficult to know how far these geopolitical influences are shaping the oil markets – and space does not permit a more elaborate analysis – but there certainly seems to be more than plain ‘supply and demand’ issues at play.Thus the timing of the current low oil prices are driven more by these current geopolitical factors, but other factors will inevitably produce the same effect. In other words, the foreground "noise" of this geopolitics is masking the background fundamental sounds of the operation of capitalism. His essay focuses more on the broader issue of the limited supply of relatively inexpensive oil within a capitalist economy which requires growth, and thus offers some very important insights about the resulting contradictions and disasters that we will experience as long as capitalism exists.
In an earlier essay published in Reliance in October 2014 entitled "Life in a 'degrowth' economy", he argues that only much simpler lifestyles supported by a different economic system will save us from disaster.
We need to create new, post-capitalist structures and systems that promote, rather than inhibit, the simpler way of life. These wider changes will never emerge, however, until we have a culture that demands them. So first and foremost, the revolution that is needed is a revolution in consciousness.
