The world was transformed by the technological advances of the 18th and 19th centuries which allowed energy stored in fossil fuels to be released and exploited in previously unimaginable amounts. Historian Ian Morris has taken a stab at quantifying the human welfare gains of the energy revolution ( ianmorris.org/docs/social-development.pdf). As his chart (reproduced below) illustrates, social development underwent a vertiginous rise after the energy revolution.

With massive quantities of energy, the world can support many billions of human beings – and far more than the 800 million the geographer Thomas Malthus claimed as the maximum possible number two centuries ago (just as the energy revolution was getting under way). But, without huge amounts of energy, the planet’s population would fall back towards the Malthusian ceiling.

If fossil fuels, which still account for four-fifths of the global energy mix, ran out tomorrow food production would collapse. Systems of food and water distribution would fail. Electricity and transport systems would cease to function.

It is a great relief, then, that those who have been predicting imminent scarcity of fossil fuels are being proved as wrong as Malthus.

Estimates of recoverable oil and gas reserves on the planet have been rising in recent years despite continued and growing consumption of what is, ultimately, a finite resource. This is happening because more oil and gas are being found and technologies to extract, transport and use them are advancing rapidly. Some specific developments have been particularly important.

First, higher energy prices over the past decade, particularly for oil, have incentivised energy companies to widen the geographic range of their searches, with the relatively unexplored southern hemisphere oceans now being explored more thoroughly. Enormous finds off the coasts of East Africa (with Irish companies involved) and Brazil have contributed to the increase in reserves.

Second, technological advances have made it possible to extract fossil fuels from sources that were previously untappable. Oil from tar sands and gas from shale (using the controversial “fracking” technique), in North America in particular, are the most important examples. Third, improved technology has allowed a greater percentage of oil and gas to be recovered. These developments and many others have big implications for how countries think about and plan for their future energy needs.

Energy policy everywhere has three objectives: security of supply; competitive prices; and environmental sustainability.

From a security perspective, recent developments have been unambiguously good. Scarcity always causes problems. Most seriously, securing energy supplies has been a contributory cause of conflict, including the bloodiest of them all, the second World War. Fears of “resource wars” later in this century have been lessened by the rise in reserves, including in the 21st century’s two most powerful countries: the US and China.

Currently, the US energy sector is one of the few booming industries in that country and the International Energy Agency expects China to become one of the world’s largest natural gas producers. This very considerably lessens the chances of future superpower tensions, thereby enhancing global security. Other benefits include reduced dependence on the Middle East, a region that is among the world’s most politically unstable; and, for Europe specifically, reduced dependence on gas from Russia – dependence on that country always comes with considerable risks.

The two other objectives of energy policy – competitive prices and environmental sustainability – are very difficult to reconcile in the case of hydrocarbons.

While lower energy prices boost economic activity, they also lead to greater consumption, thus increasing C02 emissions and, in turn, accelerating climate change.

Predicting oil prices is notoriously difficult (an excellent recent International Monetary Fund working paper – www.imf.org/external/ pubs/ft/wp/2012/wp12109.pdf – discusses this issue and others from both economic and geological perspectives). But because the costs of pumping oil have risen very sharply in recent years, the days of $10 a barrel are gone and never coming back. Prices are far more likely to remain closer to $100 a barrel. This will curb consumption, incentivise research to find ever more efficient ways of using every drop of oil and keep the relative price of renewables down.

Oil, gas and coal will eventually run out. But there is plenty of time for human ingenuity to find replacements. The only worry is the scale of the environmental damage done in the meantime. Entire species will be threatened. Ours could be too.