Amid vague talk of how $100/barrel oil might represent a kind of sea change, inspiring corporations and individuals to lower their carbon footprints, the smart money is betting on another direction: the burning of more coal.

That’s a harrowing trend. As NASA climatologist James Hanson recently put it:

Coal will determine whether we continue to increase climate change or slow the human impact … Increased fossil fuel CO2 in the air today, compared to the pre-industrial atmosphere, is due 50% to coal, 35% to oil and 15% to gas.

Hanson must be frowning at recent reports of a coal boom in Asia. The latest from today’s Wall Street Journal:

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Vast coal reserves in Asia are gaining attention as major energy consumers such as China and India grapple with the reality of oil prices around $100 a barrel and the risks they pose to their economies.

Unlike most of the Journal‘s excellent coverage of this topic, this article doesn’t explicitly state that a huge chunk of the energy burned by China and India goes to making imports for the U.S. market. But the article remains worth reading.

How much cheaper is coal than oil? One energy analyst tells the Journal that “Coal prices would have to rise nearly fivefold to match current oil prices on a unit-of-energy basis” (emphasis added).

Worse, the price difference between the commodities “is actually widening,” the analyst adds. Somewhere, James Hanson is probably seething with anger, if he’s not shaking with fear.

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Other interesting tidbits:

  • China and India together account for 45 percent of global coal use — and will likely “account for more than four-fifths of the increase in global consumption over the next two decades.”
  • A third of the globe’s proven coal reserves lie in Asia, which also happens increasingly to be the globe’s manufacturing base. Meaning when every time you buy imported cheap stuff, you probably just burned through some Asian coal.
  • It’s been widely reported but bears repeating: China is steadily moving to build out its coal-to-liquid-fuels infrastructure:

    This year, Shenhua Group Corp. will start China’s first large-scale coal-to-liquids plant, in the coal-rich region of Inner Mongolia. The plant will have a daily output of 20,000 barrels in its first phase, before raising output to 100,000 barrels a day in future years.

    Other CTL plants in the works involve foreign investors, such as Sasol Ltd. and Royal Dutch Shell PLC. By 2030, the IEA said, China’s nonconventional oil supply from coal-to-liquids plants will reach 750,000 barrels a day.

Incidentally and slightly off-topic, I’ve just finished Nassim Nicholas Taleb’s Fooled By Randomness, a provocative read. Taleb, a former hotshot Wall Street trader, has plenty of fun at the expense of his old colleagues on the Street. He paints most of them as more fools of chance than Masters of the Universe.

One of the things he beards them for is keeping their noses tucked into their Wall Street Journals during their long train rides from Connecticut into the city. He portrays the Journal as an inane rag that befuddles minds with all manner of useless information on market fluctuations.

There’s plenty of that, to be sure; and there will be more, now that that ham-fisted philistine Rupert Murdoch has added the Journal to his trophy case. But for now, the paper remains essential reading on important long-term trends — such as the way the U.S. has moved its manufacturing base to China, from where we stock our Wal-Marts with the fruits of cheap labor and cheaper coal.

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