The highly respected International Energy Association is telling you and I as well as G20 leaders meeting now in Korea that we must end oil subsidies. You subsidize oil companies through the taxes you pay every day to increase their massive profits while at the same time their product destroys our shared earth through global warming and kills people daily from the pollution resulting from the use of derived products. On top of all that we are in the middle of peak oil that finds our economic systems being rocked by a global depression.
Keep in mind this is only the "consumption" side subsidies in the producing countries like Iran and China. Imagine the similar level of massive subsidies the distributors (big brands like Exxon, BP and Shell) get in Europe, United States and Canada (it has been reported that Canada subsidizes oil up to $2 billion annually...just imagine what the Europe and the US adds in terms of subsidies). Eradicating ALL subsidies to fossil fuels would enhance energy security, reduce emissions of greenhouse gases and air pollution, and bring economic benefits.
"Fossil‐fuel subsidies remain commonplace in many countries. They result in an economically inefficient allocation of resources and market distortions, while often failing to meet their intended objectives. Subsidies that artificially lower energy prices encourage wasteful consumption, exacerbate energy‐price volatility by blurring market signals, incentivise fuel adulteration and smuggling, and undermine the competitiveness of renewables and more efficient energy technologies. For importing countries, subsidies often impose a significant fiscal burden on state budgets, while for producers they quicken the depletion of resources and can thereby reduce export earnings over the long term. Fossil‐fuel consumption subsidies worldwide amounted to $312 billion in 2009, the vast majority of them in non‐OECD countries. The annual level fluctuates widely with changes in international energy prices, domestic pricing policy and demand: subsidies were $558 billion in 2008. Only a small proportion of these subsidies go to the poor. Considerable momentum is now building globally to cut fossil‐fuel subsidies. In September 2009, G‐20 leaders committed to phase out and rationalise fossil‐fuel subsidies, a move that was closely mirrored in November 2009 by APEC leaders. Many countries are now pursuing reforms, but steep economic, political and social hurdles will need to be overcome to realise lasting gains.
Reforming inefficient energy subsidies would have a dramatic effect on supply and demand in global energy markets. We estimate that a universal phase‐out of all fossil‐fuel consumption subsidies by 2020 — ambitious though it may be as an objective — would cut global primary energy demand by 5%, compared with a baseline in which subsidies remain unchanged. This amounts to the current consumption of Japan, Korea and New Zealand combined. Oil demand alone would be cut by 4.7 mb/d by 2020, equal to around one‐quarter of current US demand. Phasing out fossil‐fuel consumption subsidies could represent an integral building block for tackling climate change: their complete removal would reduce CO2 emissions by 5.8%, or 2 Gt, in 2020. inefficient." -- according to the recent 2010 report put out by the International Energy Association IEA.