January 2008


Peak Oil30 Jan 2008 11:05 am

Here are a few choice quotes about peak oil from Kenneth Deffeyes, a long-time oil man who actually worked with King Hubbert. From Hubbert’s Peak (published in 2001), page 12:

My own opinion is that the peak in world oil production may even occur before 2004. What happens if I am wrong? I would be delighted to be proved wrong. It would mean that we have a few additional years to reduce our consumption of crude oil. However, it would take a lot of unexpectedly good news to postpone the peak to 2010. My message would remain much the same: crude oil is much too valuable to be burned as a fuel.

Hubbert’s Peak, page 164:

In the long run, the eventual use for oil will be for manufacturing useful organic chemicals. I expect our grandchildren to ask, “You burned it? All those lovely organic molecules, you just burned it?” Sorry, we burned it.

And from Beyond Oil (published in 2005), page 33:

OPEC was founded to stabilize world oil prices. [...] If the price fell below $22 [per barrel], OPEC would cut back production. If the price went above $28, they could flood the market with oil. Since 2002, OPEC has been producing essentially at full capacity. Early in 2004, with oil prices near $33, OPEC announced a cut in production. The good news is that OPEC is no longer in charge of the price of oil. The bad news is that nobody is in charge.

Peak Oil06 Jan 2008 12:26 am

I have a confession to make: until very recently, I hadn’t even heard the term “peak oil”. Much less understood what it means, and the implications it has for all of us (as in all of us, the people who spend a bit of time here on planet Earth). Over the holidays I spent a good bit of time learning all I could.

The basic idea behind the phrase “peak oil” is that the world’s production of oil will sooner or later reach a maximum and subsequently decline (the rise and fall in production are predicted to approximate a bell curve as a function of time). In fact, we very possibly have passed that peak.

This sort of rise and fall in production is no longer just a theoretical construct, but has since been observed in several directly relevant cases (one example is the rise and fall in US oil production, which peaked in the beginning of the 1970s and is now nicely riding down that bell curve).

The effects that this decline in world oil production will have on society — especially given the growing demand not only in the US but in India, China, and other rapidly developing areas of the world — will be profound. The effects will become serious not just sometime in the distant future, 30 or 50 or 100 years from now, but very soon.

You will not simply be paying a higher price at the pump for gasoline. Sure, driving will become increasingly expensive. But there will also be less and less food available on supermarket shelves. Products that depend on cheap petroleum and its byproducts — everything from electronics, plastic goods, pharmaceuticals, and cheap goods built in (and shipped from) China to goods transported by truck and foods grown using fossil-fuel-based fertilizer and pesticides — will become increasingly expensive and rare. There will be no WalMarts or Costcos serving up huge quantities of goods at unbelievable prices. Those prices are unbelievably low because they are paid for by the one-time windfall of oil we’ve been burning up so quickly these last 50 years or so.

As the decline in world oil production becomes manifest, we will see entire sectors of the (US and global) economy squeezed to death, causing increasing unemployment and hardship. We can probably expect years or decades of global recession, probably depression.

There’s no real debate about the eventual downturn in global oil production — it is going to happen, whether 5 or 10 or maybe 15 years from now. There are also some aspects of the long-term picture that seem pretty likely. For example, the entire trend towards globalization will reverse, and we will ultimately be living our lives much more locally. And while some renewable energy sources hold promise for supplying some energy, it is likely that in the short term we won’t be able to come anywhere close to meeting demand. For reasons I won’t get into here (see the resources below), hydrogen fuel cells (which are a form of energy storage, not an energy source) and biofuels (which cost more energy to produce than they yield) are not answers but rather dangerous distractions.

All of that said, I’m not an easily shaken person, and I don’t want to appear alarmist. There are some positive aspects to the situation:
* Community will once again become a much more central part of the human existence. You will know you neighbor quite well, because she is the one providing much of the food you eat.
* While we will certainly see global warming continue for some time via inertia, there’s a chance the impact will taper off. Unless, of course, we start making too much use of dirty coal processes in lieu of oil…
* Many people, myself included, love a challenge. The next half century or so is sure to hold plenty of those…

Some of the primary questions that I have surrounding the short- to medium-term:
* How soon will the shortage become clear to most people?
* How hard will the economic landing be?
* How much civil unrest will we see?

More long-term (like 50 years from now):
* Will we have the capability and inputs to manufacture electronics?
* Will there be an internet or equivalent?

I’m sorry to have gone on so long. If you’ve gotten this far, I urge you to learn more about the upcoming oil shortage. Here are some resources:
* The End of Suburbia: Oil Depletion and the Collapse of the American Dream. If you do one thing, it should be to watch this DVD (which was in our public library — yay Loudoun!).
* Beyond Oil. Great overview from a guy who has known the oil industry for decades, and worked with Hubbert (who originated the “peak oil” hypothesis). This too was available in our public library.
* Peak Oil website. Good online overview.
* Life After the Oil Crash. A good online overview, if a bit alarmist.