Peak – Take One

Here is the first of two posts on the subject of Peak Oil. The following is mostly comprised of references to other sources of information, opinions, and quotes. I have included links throughout, for your browsing pleasure. But first I wanted to cite our “national leader” Prime Minister Stephen Harper, asking you to consider his standard-issue take on economics:

“Without the wealth that comes from growth, the environmental threats, the developmental challenges and the peace and security issues facing the world will be exponentially more difficult to deal with,”

… in an address to South Korea’s National Assembly.
[From:http://www.bloomberg.com/apps/news?pid=20601082&sid=aypC61AZIPec ]

If wealth comes from growth, where does he hope growth will come from? In ecosystems, growth (life) stems from energy inputs (the sun, plants for herbivores, meat for carnivores, etc.). In our ecosystem known as the economy, we derive the vast majority of our energy, not from food, but from compressed organic matter known as fossil fuels. Our revered economic growth stems from ever-increasing inputs of this energy source. So I would suggest that Mr. Harper take a second look at his simple logic in light of the Peak Oil reality that is dawning on us. It poses a truly confounding conundrum to be sure. And it’s easy to see why Peak Oil is a political wet blanket. But just because our leaders continue to ignore it, doesn’t mean the reality of it will evaporate.

But enough of my opinions! Below are some others’. Happy reading!

[And don’t worry. It’s really not that depressing being informed; in fact, it’s empowering to find optimism based on reality, rather than some vague presumptions spoon-fed to us by people who should know better.]

Kunstler
For some of the most colourful – if sometimes inflammatory – commentary on the global energy predicament, there is James Howard Kunstler’s “Clusterfucknation” blog. A recent entry included this tidbit:

“Industrial economies are still at the mercy of peak oil. This basic fact of life means that we can't expect the regular cyclical growth in productive activity that formed the baseline parameters for modern capital finance - meaning that we can't run on revolving credit anymore because growth simply isn't there to create real surplus wealth to pay down debt.”

[From: http://kunstler.com/blog/2009/12/forecast-2010.html#more ]

For another reiteration of his central thesis see also: [http://kunstler.com/blog/2009/11/courting-convulsion.html]

“What's going on in the US economy is a slow-motion convulsion from which we will emerge as a very different nation with a different economy. The wild irresponsibility of the media in pretending otherwise is only going to make the convulsion worse, more painful, more socially and politically destructive. The convulsion can be described with precision as one of compressive contraction. Historic circumstances are requiring us to change our behaviour, to make new arrangements for everyday life in all the major particulars: capital accumulation and deployment; food production; commerce; habitation; transport; education; and health care. These new arrangements must be organized at a smaller and finer scale, and on a much more local basis.
The main "historic circumstance" mandating these changes goes under the heading of "peak oil." We've come to the end of our ability in this world to increase energy inputs to the global economy. The routine "growth" in industrial activity and production that has been the basis of our financial arrangements for 200-odd years is no longer possible. Offsetting this decline in oil energy "input" with "alt.energy" is a dangerous fantasy because it distracts us from the urgent task of making new arrangements for trade, food production, et cetera - the very things that would provide jobs and social roles for our citizens in the future.”

Heinberg
For a more sober analysis, though no less passionate, I like to check in with Richard Heinberg, who’s position can be summed up thusly:

“Sooner or later, we must face reality. If we do it sooner, our chances of adapting successfully are far better than if we wait and deny just a little longer.”

And from an article posted to his “Museletter” blog [http://heinberg.wordpress.com/2009/12/09/211-isclean-coal-a-dead-end/ - see # 2 “Just Tell Us the Truth”].
The article begins:

“At last we know…sort of. An article in the UK newspaper The Guardian for November 9, titled “Key Oil Figures Were Distorted by US Pressure, Says Whistleblower,” reveals what hundreds of analysts have been trying to convey to world leaders for years: The global oil supply situation is critical and getting worse, and vested interests are playing key roles in covering up this devastatingly inconvenient truth.
…
“In the past few years these lone voices of warning have garnered the backing of a million-voice chorus: investment banks, oil analytics firms, and investigative journalists have joined the geologists in pointing out that oil production limits are within sight, and in calling for more transparency in official data reporting and forecasting.”

Sharon Astyk
Getting the Story Right: The Peak Oil vs. Climate Change Inanity Continues [http://www.energybulletin.net/node/50945]

“The IEA has pretty much conceeded peak oil, announcing that growth to meet demand in the coming decades will come from entirely mythical sources. Ok, they didn't say that, what they said in the latest World Energy Outlook was that the majority of oil production by 2030 will be coming from "fields yet to be developed or found." But what that means is "we're hoping someone with magic powers will come and reverse the long-standing trend towards decline in oil discovery." Because we know that oil discovery peaked in 1964 and has been declining ever since, so that we are consuming oil five times faster than we are discovering it. According to energy consultants IHS, 90% of all known or suspected reserves are in production already. In a world that consumes 40,000 plus barrels per second, that's a pretty big deal.”

Charles Cresson Wood
The Irrationality Of Not Preparing Contingency Plans For Peak Oil [http://www.energybulletin.net/50578]
“The public has known about the threat of markedly diminished oil supplies since 1956. Over the last 50 years, the notion of more limited future supplies of oil has been fiercely debated in public forums, and now the data clearly shows which side was right. Now we see that there is no longer any dispute, now we see that we are on a plateau, where we are unable to increase world oil production, regardless of the price that this oil fetches in the marketplace. To verify the correctness of these statements, direct your browser to the web site of the conservative US Government agency called the Energy Information Administration. In spreadsheets of the world oil production numbers, you will see that world oil supply has been about 74 million barrels per day since 2005. Note that this production did not markedly change, even though the price spiked up to $147/barrel in July 2008. A variety of high-credibility scientifically researched reports discuss the seriousness of our current situation, our position at the peak of world oil production. For example, you might reference "Peaking Of World Oil Production: Impacts, Mitigation, & Risk Management" by Robert L. Hirsch et al, and "Global Oil Depletion – An Assessment of the Evidence For Near-Term Peak in Global Oil Production" by the UK's Energy Research Centre.”

The Hirsch Report
And if you haven’t had enough yet, and you have a penchant for number crunching and technical analysis you can read the actual report cited above, here:
http://www.nyswda.org/LegPosition/HirschReport.htm

And there’s more!
Here is an article [http://www.energybulletin.net/node/50874]on China’s Growing economy, and a good example of the many considerations of how the energy supply may have a very strong impact on projected growth. The article finishes on this note:

“Over the next year, the price of oil will be driven higher by two forces - a weaker dollar and increased demand that cannot be met. While there may be 3 or 4 million barrels of spare capacity to produce oil - mostly in the Middle East -- the last couple of million barrels will be very expensive oil and will require higher prices to bring onto the market.
Taken together, the evidence suggests that higher, possibly much higher, oil prices in the year ahead are likely. The U.S. deficit is not going away and the dollar is likely to continuing falling…. [F]or much of the world, oil prices are subsidized by the state so that much higher oil prices do not really impact consumer demand.
Those talking of economic recovery in the U.S. would do well to contemplate what the effects of oil prices north of $100 a barrel will be.”

Other Links
You may also like to check in with the Association for the Study of Peak Oil [ASPO-USA http://www.aspousa.org]
Peak Oil Reality: Industry Experts Offer Growing Drumbeat of Supply Warnings (press release) [http://www.energybulletin.net/node/50826]
Newly-released videotaped remarks reinforce statements by senior petroleum industry officials about looming world oil supply constraints
Videos available: http://www.aspo.tv/aspo.tv-news.html
Oil Exploration and Production Constraints: http://www.youtube.com/watch?v=VUVY2qrEfd8
Acknowledging Peak Oil: http://www.youtube.com/watch?v=cd7QGbNKxoQ

And then there’s The Oil Drum [http://www.theoildrum.com/]