It is frequently argued that ever-rising oil prices will encourage good climatic outcomes. They make people cut back on flying and buying SUVs, and thus reduce emissions through destroyed demand. One counter-argument highlights how consistently high prices encourage the use of fuels even filthier than oil: such as coal and hydrocarbons produced from the oil sands. Arguably, uncertainty and instability actually produce the best climatic outcomes, since they leave the profitability of huge hydrocarbon investments uncertain.
This piece in The Globe and Mail argues that the recent fall in oil prices, combined with constrained access to credit due to the financial turmoil in the United States, is threatening the development of the oil sands.
Of course, uncertainty about future energy prices and restricted access to capital are also likely to hurt the development of renewable sources of power, such as concentrating solar plants in the American southwest that retain enough thermal energy overnight to produce electricity continuously. The ideal option is a predictable, ever-increasing price for carbon emissions. That would give clean sources of energy the confidence to invest, while simultaneously discouraging the development of amply available yet climatically disastrous sources of energy – at least until such a time (if ever) when effective carbon sequestration emerges.