The Impact Of The Common Market On The Petroleum Industry

The European Economic Community (The Common Market) is now shifting from I a coal oriented to an oil oriented economy. The proportion of energy supplied by oil has increased from only 13% in 1950 to 38% in 1962, and will approach 50% by 1970. In the past five years Common Market petroleum demand has in- creased 15% per year compared with only 3% per year in the United States. This rapid shift to oil can be explained by looking at oil's competition, First; there is simply not enough other energy - European coal, natural gas and hydro-electric power - to meet the demand, Secondly, oil?s primary competing energy in the Common Market is coal, and Community coal is high-priced - it costs more than two and a half times as much as U. S, coal at the pithead. The third reason for the shift to oil is consumer preference for the ease of handling, convenience and cleanliness of liquid fuels. As these reasons suggest, much of the shift to oil and the resulting growth in demand would have occurred whether or not the Common Market organization had existed. On the other hand, the Common Market has stimulated the use of oil by causing a higher rate of energy consumption, and oil has been the beneficiary of most of this growth.