[Marxism] The hidden costs of cheaper oil

Louis Proyect lnp3 at panix.com
Sat Jun 26 10:05:19 MDT 2004


NY Times, June 26, 2004
China Pays a Price for Cheaper Oil
By KEITH BRADSHER

HONG KONG, June 23 - With toxic lead finally disappearing from most of 
the world's gasoline, a new air pollution fight is emerging around the 
globe over how much sulfur to allow in fuel. Rapidly developing 
countries like China, India, Thailand, Mexico and Brazil, where 
ownership and use of cars and trucks is soaring, are on the front lines.

High levels of sulfur contamination occur naturally in some crude oil, 
especially from the Mideast and Russia. This "sour" oil is ordinarily 
harder to sell and fetches a lower price than "sweet" low-sulfur crude, 
because it is more difficult to refine and because environmental laws in 
the United States and Europe already impose tight ceilings on sulfur in 
fuel, limits that are set to grow still tighter over the next decade.

But this year, oil producers are pumping and selling all the oil they 
can to meet surging demand, and the extra oil they are able to bring to 
market is, to a great extent, high in sulfur. With sweet crude 
commanding the highest prices, many refineries in China and elsewhere 
are buying cheaper sour crude, and turning it into fuels that may 
contain many times more sulfur than the gasoline and diesel sold in the 
United States or Europe.

Environmentalists call sulfur the world's biggest single contributor to 
air pollution. It forms noxious gases like sulfur oxides, and it causes 
diesel engines to spew more soot. And high-sulfur fuel quickly ruins the 
catalytic converters installed on new gasoline-powered cars, defeating 
one of the main efforts in countries like China to cut down on the harm 
that vehicles do to air quality.

"Sulfur is definitely the lead of the future," said Robert Cox, the 
fuels manager at the International Petroleum Industry Environmental 
Conservation Association, a London-based trade group supported by oil 
companies.

The oil industry has called on automakers to develop new catalytic 
converters that are more sulfur tolerant, while acknowledging that 
sulfur is a significant problem, especially in developing countries with 
limited budgets. Mr. Cox said that in September or October the trade 
association would issue its recommendations for what levels of sulfur 
are attainable for countries at various levels of economic development, 
adding that "sulfur has got to be the next issue."

The problem is especially acute in China, where car sales have been 
rising by close to 80 percent a year, creating huge traffic jams and 
contributing to some of the world's worst air pollution. At the same 
time, Chinese refineries have emerged as the world's most aggressive 
buyers of high-sulfur crude oil.

"They really need to ratchet down very quickly on their emissions 
standards, or their cities are going to become unbearable," said Michael 
P. Walsh, a former top American air-quality regulator who now works as a 
consultant to the Chinese government and other developing countries on 
air-quality issues.

full: http://www.nytimes.com/2004/06/26/business/worldbusiness/26sulfur.html

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