Introduction

In dealing with each of the carbon fuels, both specific and implicit references have been made to trends in costs and prices, but these observations need to be brought together into an integrated overview. Questions of costs and, even more so, of returns on investments constitute a general set of parameters relevant to most resource evaluations, in the context of the existence of a common measure of economic accounting in the global system. Few significant differences can emerge between the prices of fuels except as temporary phenomena, usually arising either from national policies involving protection for indigenous production, or from major disruptions to international trade caused by wars (Odell, 1971; Heinberg, 2003) and revolutions (Clawson, 1964). Except in such extreme circumstances, then were such divergences to emerge, they would inevitably lead to compensating changes in supply schedules so that the equilibrium could be re-established. But, the restoration of equilibrium is inevitably a time-consuming process so that there may occasionally be a need for subsidies or other protective measures in specific markets to encourage the production of more expensive resources; as in the aftermath of the oil price shocks of 1973/4 and 1979/80 (Odell, 1986). In general, of course, contrasting transportation costs in getting production to markets produce contrasting netbacks for different fuels in the same region and between regions for the same fuel, but in a macro-study of the overall global situation over a long period of time, such transport orientated differences are unlikely to mount to much more...