Over the past few years, interest in biofuels has soared as concerns about climate change and rising oil prices have taken over the public discourse. And the tendency is for more of the same: “On current trends, energy-related emissions of carbon dioxide and other greenhouse gases will rise inexorably, pushing up average global temperatures by as much as 6ºC in the long term. Strong, urgent action is needed to curb these trends.” (World Energy Outlook 2008). At the same time, as demand for oil has risen and oil prices have skyrocketed, spending on oil as a share of world GDP increased inexorably —reaching 4% in 2007 compared to 1% just ten years earlier!

World oil prices are expected to remain both high and volatile. Over the next two decades, the World Energy Outlook (November 2008) expects the oil supply-demand balance to remain tight as (i) older productive fields decline and discoveries of large reservoirs become more infrequent, and (ii) demand for energy remains strong. At the same time, the production of oil is expected to become more geographically concentrated as newer oil regions decline and investments flow into the oil-rich regions of the Middle East where production costs are still the lowest in the world.

The bulk of the increase in demand for energy is expected to come from the transportation sector. In OECD countries, transportation is expected to be the only sector with increased energy consumption; and in non-OECD countries, transportation will be the leading source of growth in oil demand—as more consumers reach the income threshold where car purchases become affordable. Geographically, the bulk of the increased demand for oil is expected to come from Asia and the Middle East.

Therefore, robust efforts to tackle climate concerns must start with, and be focused on, the global transport sector. This makes biofuels and the search for better energy crops a key strategy for addressing climate concerns, solving energy security issues, and tackling high oil prices.