Peak Oil
Never heard of this?
You will soon enough.
This week I gave a speech in my Toastmaster club on this subject.
The "theory" is that oil, being a finite resource, follows a characteristic production curve over time shaped like a bell, with exponential increase in production as development expands, and slowly peters out after a peak production, and exponentially decays back down to zero.
The America Petroleum Geologist, Hubbert, looked at the discovery, production curves of the U.S. (lower 48 states) oil wells and using this information predicted in 1956 that oil production would peak in 1970, and he was right on. Our oil production has declined ever since, even with Alaska and Gulf of Mexico production added it, they've not halted our ever continuous decline. As of 2004, the U.S. imports 60% of our oil needs, and this will continue increasing no matter what we try to do with domestic production.
Over recent decades similar analyses have been performed on world oil markets - recognizing that most of the large discoveries are all decades ago. With this information projections have been made on what is the "ULTIMATE" oil production over the lifetime of our "age of oil", extrapolating traditional production and technologies for increasing production from older wells.
Estimates for the "Ultimate reserves" vary:
How much have we consumed so far? Just about 0.960 trillion barrels.
At the moment we're consuming about 82 million barrels/day, or 30 billion barrels per year, and that rate is increasing an average of about 2% per year.
So why should we be worried if there's so much oil still left?
First because 2/3 of the oil exists within the Middle East - most within 5 countries.
Second because the U.S. has the highest per capita oil consumption rate of a large country. We have 5% of the world's population and consume 25% of the world's oil production. Other developing countries are catching up to us, although they'll never make it, but their thirst for oil will drag us down sooner than otherwise.
Third because even by the HIGH 3.0 trillion barrel ultimate reserve estimate, we're only 12-15 years from the half way point of consumption, and that's the point in Hubbert's theory where oil production tends to slow down - where easy reserves have been taken, and more and more of the remaining oil will become slower and more expensive to extract.
Sure Saudi Arabia will have cheap oil (to extract) available for decades, but that doesn't mean their rates of extraction will be able to compensate for reduced extraction elsewhere.
The world oil consumption is soon reaching a point where production will not be able to keep up. It's just a matter of time, and as we approach that day, early warning signs will appear - as every localized disruption of production is multiplied on the world markets as temporary price spikes when there's insufficent supply to meet demand.
It is of course insane for the U.S. to continue on our current course of action - depending on this soon to be ever more expensive fuel, ever more dependent upon Middle Eastern oil, ever more costly import, throwing our trade deficit ever deeper, and pretending we can afford the world's most expensive military to help keep this vital resource flowing.
It's going to end sooner or later. The party's nearly over, and then we'll see what "Freedom" means to us, what "Independence" means, and how our democracy can pass through an energy crisis on a magnitude never seen before.
It is already too late. No matter how hard we tried now to reduce our dependence upon oil, it would be too slow to avoid the coming oil crisis. Anything we do now will just help ease us ever so slightly into a world we have yet to imagine - without the resource of cheap oil.
Dream all you like about "building a better world", "Spreading democracy around the world", but soon we'll be looking much closer to home - like trying to figure out how to run airlines with fuel prices 5-10 times higher than now, and trying to figure out how to produce our industrial agriculture without cheap petroleum products for fertilizers, or maintain our vast roads ways - not to mention running all the vehicles that keep our economy flowing.
Foolish people say "The stone age didn't end because we ran out of stones, and the oil age won't end because we run out of oil." Some are convinced something better will come along when we need it - like oil came along to "save the whales" from our demand for their oil. Nice story, but I don't believe it. Societies HAVE failed because lose of primary resources.
We have alternatives - most namely Coal, which is more costly, more dirty, but capable of being processed into petroleum. Canada has "oil sands" which also can, with heat, be processed into a petroleum like substance - with large pollution output and higher productions of carbon dioxide into the atmosphere. Nuclear energy is continued to be promoted within circles as the way we'll escape our soon-t0-be apparent return to an agrarian culture.
None of these alternatives will be quick enough to avoid severe upsets to our ever debt-ridden culture and economy. None of these will improve our environment like we'd tried to do for the last 50 years. None of these are ultimate long term solutions that can sustain us in a world we will want to live in.
Don't believe me? Do your own research and see what options there are.
Personally I admit I'm small and powerless. Of course I would have implemented high fuel efficiency standards long ago, and applied a European level tax on gasoline and petroleum uses to conserve also long ago. Some of these might have made a difference, and still can't hurt, but it seems denial goes too deep. People want to remain asleep as long as possible, avoid the insane dependency, and let the next generation figure out how to go to "the next level" of destruction.
Well, my bet is there is no "next level" available to us. My best bet is between political instability and geological and technical limits, the date of peak oil is sooner than later, and then we'll get what we deserve - the harsh light of full sun burning into our foolish shadows we too long failed to see. We'll see soon enough. Unfortunately denial will run deep.
I'm asleep as well - still hoping for "Managed transition", even if downward, but overall it seems too hard. I'll just try to stay out of debt and hope for the best. What I can do? What can any of us do?
Have a nice day, while you can still enjoy a vision of the future that ever grows more wonderous.
You will soon enough.
This week I gave a speech in my Toastmaster club on this subject.
The "theory" is that oil, being a finite resource, follows a characteristic production curve over time shaped like a bell, with exponential increase in production as development expands, and slowly peters out after a peak production, and exponentially decays back down to zero.
The America Petroleum Geologist, Hubbert, looked at the discovery, production curves of the U.S. (lower 48 states) oil wells and using this information predicted in 1956 that oil production would peak in 1970, and he was right on. Our oil production has declined ever since, even with Alaska and Gulf of Mexico production added it, they've not halted our ever continuous decline. As of 2004, the U.S. imports 60% of our oil needs, and this will continue increasing no matter what we try to do with domestic production.
Over recent decades similar analyses have been performed on world oil markets - recognizing that most of the large discoveries are all decades ago. With this information projections have been made on what is the "ULTIMATE" oil production over the lifetime of our "age of oil", extrapolating traditional production and technologies for increasing production from older wells.
Estimates for the "Ultimate reserves" vary:
- Geologist, Cambell (1995): 1.8 Trillion barrels
- USGS (2000) (95% confidence): 2.2 Trillion Barrels http://www.eia.doe.gov/pub/oil_gas/petroleum/presentations/2000/long_term_supply/sld001.htm
- Geologist, Harper, BP, (2004): 2.4 Trillion Barrels. http://www.thebusinessonline.com/modules/news/view.php?id=29138
- "Average statistics of the major oil companies": 2.9 Trillion Barrels
USGS (2000) (50% confidence): 3.0 Trillion Barrels
http://www.busrep.co.za/index.php?fSectionId=&fArticleId=2392226 - USGS (2000) (5% confidence): 3.8 Trillion Barrels
How much have we consumed so far? Just about 0.960 trillion barrels.
At the moment we're consuming about 82 million barrels/day, or 30 billion barrels per year, and that rate is increasing an average of about 2% per year.
So why should we be worried if there's so much oil still left?
First because 2/3 of the oil exists within the Middle East - most within 5 countries.
Second because the U.S. has the highest per capita oil consumption rate of a large country. We have 5% of the world's population and consume 25% of the world's oil production. Other developing countries are catching up to us, although they'll never make it, but their thirst for oil will drag us down sooner than otherwise.
Third because even by the HIGH 3.0 trillion barrel ultimate reserve estimate, we're only 12-15 years from the half way point of consumption, and that's the point in Hubbert's theory where oil production tends to slow down - where easy reserves have been taken, and more and more of the remaining oil will become slower and more expensive to extract.
Sure Saudi Arabia will have cheap oil (to extract) available for decades, but that doesn't mean their rates of extraction will be able to compensate for reduced extraction elsewhere.
The world oil consumption is soon reaching a point where production will not be able to keep up. It's just a matter of time, and as we approach that day, early warning signs will appear - as every localized disruption of production is multiplied on the world markets as temporary price spikes when there's insufficent supply to meet demand.
It is of course insane for the U.S. to continue on our current course of action - depending on this soon to be ever more expensive fuel, ever more dependent upon Middle Eastern oil, ever more costly import, throwing our trade deficit ever deeper, and pretending we can afford the world's most expensive military to help keep this vital resource flowing.
It's going to end sooner or later. The party's nearly over, and then we'll see what "Freedom" means to us, what "Independence" means, and how our democracy can pass through an energy crisis on a magnitude never seen before.
It is already too late. No matter how hard we tried now to reduce our dependence upon oil, it would be too slow to avoid the coming oil crisis. Anything we do now will just help ease us ever so slightly into a world we have yet to imagine - without the resource of cheap oil.
Dream all you like about "building a better world", "Spreading democracy around the world", but soon we'll be looking much closer to home - like trying to figure out how to run airlines with fuel prices 5-10 times higher than now, and trying to figure out how to produce our industrial agriculture without cheap petroleum products for fertilizers, or maintain our vast roads ways - not to mention running all the vehicles that keep our economy flowing.
Foolish people say "The stone age didn't end because we ran out of stones, and the oil age won't end because we run out of oil." Some are convinced something better will come along when we need it - like oil came along to "save the whales" from our demand for their oil. Nice story, but I don't believe it. Societies HAVE failed because lose of primary resources.
We have alternatives - most namely Coal, which is more costly, more dirty, but capable of being processed into petroleum. Canada has "oil sands" which also can, with heat, be processed into a petroleum like substance - with large pollution output and higher productions of carbon dioxide into the atmosphere. Nuclear energy is continued to be promoted within circles as the way we'll escape our soon-t0-be apparent return to an agrarian culture.
None of these alternatives will be quick enough to avoid severe upsets to our ever debt-ridden culture and economy. None of these will improve our environment like we'd tried to do for the last 50 years. None of these are ultimate long term solutions that can sustain us in a world we will want to live in.
Don't believe me? Do your own research and see what options there are.
Personally I admit I'm small and powerless. Of course I would have implemented high fuel efficiency standards long ago, and applied a European level tax on gasoline and petroleum uses to conserve also long ago. Some of these might have made a difference, and still can't hurt, but it seems denial goes too deep. People want to remain asleep as long as possible, avoid the insane dependency, and let the next generation figure out how to go to "the next level" of destruction.
Well, my bet is there is no "next level" available to us. My best bet is between political instability and geological and technical limits, the date of peak oil is sooner than later, and then we'll get what we deserve - the harsh light of full sun burning into our foolish shadows we too long failed to see. We'll see soon enough. Unfortunately denial will run deep.
I'm asleep as well - still hoping for "Managed transition", even if downward, but overall it seems too hard. I'll just try to stay out of debt and hope for the best. What I can do? What can any of us do?
Have a nice day, while you can still enjoy a vision of the future that ever grows more wonderous.
posted by Ares Olympus at 8:21 PM
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