Economists from their earliest version as physiocrats have theorised about the source of wealth. Back in those days it was apparent that the source of wealth was land. The land owners had the power over their tenants and grew rich.

Much later the economist Karl Marx (and others) theorised that the source of wealth was actually human labour. Marx did a lot of painstaking work to arrive at his view which became the basis for a political movement. In his eyes, wealth was captured by the capitalist and managerial classes.

If you examine a modern economics text book for the economist's current view of how goods are produced and are made available for "supply", you find that both capital and labour combine to provide a supply curve showing that the economic cost of supply increases with the rate of output. The land component has been adsorbed into their scholastically derived capital component. The curves are drawn, and a series of points is extracted to match the graph. We have yet to find a table of costs for supply that includes the cost of materials. It is as if goods are made out of thin air. Our dispute with a professor of economics resulted in his providing an example of the manufacture of glass bottles that did not include the cost of materials nor the cost of energy in the cost tabulation.

A scientist pondering the question why westerners were so wealthy and people who lived in tropical highlands were so poor came up with an interesting alternative view. He noted that the wealthy western countries had benefited from their particular temperate environment. The domestication of a few grains (such as wheat, rice and maize) and a number of animals had allowed people to secure a reliable source of food without the need to migrate from place to place.

There is perhaps more to the development of our rich and powerful nation states. As well as the domestication of grains and animals for food, there is the development of tools and their constant improvement, there is the organisation of groups of people to a common purpose to build evermore larger and more efficient systems of production. But of great significance to the last great industrial advances in production is the harnessing of nonhuman energy.

The intersection of all these factors in the development in the wealth of nations can be seen in agriculture. Productive strains of wheat were developed; tool development can be seen in the invention of the plough, energy exploitation can be seen in the use of horses and bullocks for the ploughing, and the trading in markets is the result of humans' ability to organise.

Nowadays farming is far more energy intensive with tractors and harvesters fueled by petroleum products. Wheat was once milled by wind powered mills, now replaced by mills using more modern energy sources. Food is processed and packaged using energy, and transported thousands of kilometers to markets consuming more energy. The yields of grain crops has increased, not only through selection but through the application of synthetic fertilizers, particularly nitrogen fertilizers, made from oil and by extensive energy consuming irrigation. More energy is used in producing food than is present in the food product. Energy application in agriculture has enabled the mass production of fibre for clothing.

Most humans live where clothing is required. Once cloth was woven and sewn by hand. Now the application of energy and machinery enables the mass production of clothing materials and the clothing itself. In addition, many new fibres and clothing materials are made from petroleum and its derivative products.

The agricultural revolution gave way to the industrial revolution when the energy of coal was exploited in the development of steam engines. Coal was also important in expanding the production of iron & steel, replacing charcoal. It was essential in the production of ceramic products from bricks to ornamental products. Steam engines aided the extraction of coal itself by the use of powered drainage and lifts to exploit deeper coal seams. Steam power was the driver of both rail and sea transport enabling the trade in resources and products to be expanded beyond local boundaries to a globalized marketplace. Nations that were well endowed with coal expanded their wealth (and hegemony).

The age of coal has given way to the age of oil. While coal is a good source of energy, oil is a better source of energy and is a very good medium for using energy as well. Liquid fuels extracted from oil are easier to store than coal, easier to transport, easier to apply to boilers. Liquid fuels are perfect for transport because they have high energy density, have all the advantages in distribution and can be applied to compact engines of power output in a vast range of sizes from 35cc line trimmer engines to massive engines to power large ships with very convenient control of output. Electricity is not a source of energy but is a convenient medium for energy applications but unlike oil it is difficult to store.

Energy has become important in the provison of housing. We do not live in caves or humpies anymore but require ever larger homes and domestic services which all create a demand for energy and its products. The cement used in creating concrete and concrete products requires the use of either coal or oil to manufacture. Bricks and tiles also require energy to manufacture. Electricity is important for home living, for heating and lighting for washing and drying people dished clothes etc. Most homes approach a dozen electric motors contained in various domestic devices. Even basic services like telephones, water and sewage consume energy. Domestic life without reliable energy supply would be very primitive in comparison to our current way of life.

While oil was known to the ancients, it was exploited commercially first in Romania in 1857, then in the USA in 1859. Refined oil was initially used for lighting, but the development of the internal combustion engine created a mass market for oil products. The USA was well endowed with oil and became the powerhouse of economic expansion as a consequence. Oil started to replace coal as a source of energy. In 1912 Winston Churchill as First Lord of the Admiralty switched the British navy to oil as a fuel and thereby made oil of great political importance as well. Coal, oil, and now natural gas are used as the energy source for the production of electricity, thus expanding the use of energy through its convenience.

Oil is the premier fuel for transport because liquid fuels are so much efficient and easier to use. Oil is easy to store, transport and throttle. It is also energy dense. These attributes make it the perfect fuel for transport such as shipping, motor vehicles and aircraft. It is also the preferred raw material for making a vast number of synthetic materials such as plastics, organic chemicals from which our vehicles are made.

All of the following products use contain oil: computer bodies and keyboards, printers, telephones, toilet brushes, drink bottles, stereos, TV cabinets, fridge linings, umbrellas, clothing ink, wire, crayons, enamel, cellophane, antiseptics, vacuum flasks, deodorant, pantyhose, anaesthetics, syringes, heart valves, hearing aids, artificial limbs, skis, carpets, epoxy paint, upholstery, tape cassettes, video tapes, motorcycle helmets, pillows, shower doors and curtains, shoes, electrical tape, light switches, safety glass, awnings, nylon rope, hair dye, toilet seats, denture adhesive, loudspeakers, gum boots, candles, water pipes, car enamel, credit cards, aspirin, golf balls, detergents, sunglasses, glue, fishing rods, linoleum, plastic wood, soft contact lenses, rubbish bags, hand lotion, shampoo, shaving cream, footballs, paint brushes, balloons, fan belts, paint rollers, luggage, antifreeze, toys, floor wax, sports car bodies, tyres, unbreakable dishes, toothbrushes, toothpaste, tents, hair curlers, lipstick, ice cube trays, electric blankets, tennis rackets, drinking cups, house paint, eyeglasses, life jackets, car battery cases, insect repellent, refrigerants, glycerine, plywood adhesive, cameras, bandages, dentures, mops, ballpoint pens, boats, nail polish, tape recorders, curtains, vitamin capsules, putty, percolators, insecticides, fishing lures and nets, perfumes, shoe polish, petroleum jelly, tap washers, food preservatives, antihistamines, cortisone, CD's, solvents, tyres, asphalt and pharmaceuticals. Virtually everything in supermarkets is either wrapped in it or contained in it.

Oil became vital in military matters and the depriving of both Germany and Japan of oil supplies was essential in their military defeat. Issues over oil have been involved in just about all wars since the end of the second World War.

In more recent times, gas has become significant also. Once it was a nuisance at wells and was flared off. Now it is piped to industrial areas where it is used for heating and as a fuel for gas turbines to produce electricity. It is difficult to transport by tanker so requires pipelines to supply. It will run out too but later than oil. In the USA there are planned more gas turbines than there appears to be a supply for. Gas is important as a chemical feedstock.

Recent advances in economic power have been spectacular: in the period 1950 to 2000; population has doubled, paper use (essential for organisation and knowledge transfer) has increased sevenfold, wood and water use has increased threefold, and the amount of fish caught gone up five times. The most significant of all is the fact that energy use has gone up four times and the number of cars has gone up ten times.

Energy, and particularly oil are the drivers of the expansion of the rich Western nations. There is a statistically significant relationship between energy use and GNP, although of course GNP represents commercial activity rather than human welfare. When energy restraint is forced on the world, the complex sophisticated world is headed for collapse because Liebig's Law will apply with energy being the controlling factor at its minimum.