Culture Change e-Letter
#88
originally appearing on Bluegreenearth.com
Here comes the nutcracker
Peak oil in a nutshell
The end of abundant, affordable oil is
in sight, and the implications are colossal. About now in our hydrocarbon
phase of human history, we have pulled out of the Earth approximately half of
the available petroleum (crude oil and natural gas). The other half still
in the ground is harder to extract and may not -- as assumed -- fuel the global
economy or even provide a transition to another phase.
To hope for an increase in discoveries
is to turn a blind eye to the world trend in declining oil extraction which has
been relentless for the past four decades. The approximate bell curve of
petroleum extraction cannot be changed by any one big new discovery. Yet,
the idea of "the Caspian" or any other mega-field du jour is an
example of the constant hope for perpetual energy for high living in
contradiction with nature.
The same can be said of the dominant
assumption that petroleum will be replaced by other
"technologies." This ignores the overwhelming petroleum-based
infrastructure we have, and neglects to account for the lesser return on energy
from non-petroleum sources of energy. But, "they" (scientists,
leaders, corporations) will "think of something." Another common
assumption popular among "radicals" is that "the ruling elite
will refuse" to allow the global economy or the lucrative capitalist system
to collapse.
If peak oil means we are at a half-way
point, does this mean we now have years to either plan energy use or get used to
recession, as claimed by many a writer on peak oil? Before the reader
makes assumptions on how society may utilize the remaining store of petroleum,
let me repeat what I told The Institute of Petroleum in London two years ago (on
February 17, 2003):
"What the world went through in
1979’s oil crisis, which my former company warned of in the U.S., based on
our projection of a 9% shortfall in gasoline deliveries, can happen again. The
difference will be that global production of oil will be falling instead of
increasing."
This means that the next tough oil
shortage, even if it is not acknowledged as a post-peak oil extraction
phenomenon of diminishing supply, will cripple the globalized economy.
Understanding of both the economics and social dynamics of collapse is rare, and
even when it is present there is an absence of taking into account the
"market factor" in ushering in collapse.
Despite the need to be prepared for
imminent, final energy shortage -- which could happen now or in several years at
the latest -- people persist in focusing too much on the likely date of the
passing of the peak. It is already clear that the oil industry and OPEC
numbers on oil reserves are suspect. So we can simply offer a range of
oft-quoted peak-oil arrival times: 2005-2012. Some more distant figures
such as 2020 are based on infinite technological improvements on extraction and
removing the problematic sulfur, for example. Factoring in the
"irregular" petroleum sources, the peak year of world oil extraction
is to be 2007, according to the Association for the Study of Peak Oil and Gas.
A flurry of peak oil stories hit last
fall. But in general, the price of oil is deliberately about where the main players want
it, as it is so profitable. So let us not look at the $50 price
neighborhood as proof of peak oil being here now -- although it may be a factor.
Taking peak oil doctrine further
The bell curve of oil
"production" was devised by Marion King Hubbert, a Shell Oil and U.S.
government geologist. Although Hubbert has on the whole been borne out
except in the minds of fundamentalist-classical economists, what he did not
factor in was collapse. Therefore, the curve will be truncated to a cliff
just as the gap between supply and demand is felt and hits.
The scenario I foresee is that
market-based panic will, within a few days, drive prices up skyward. And
as supplies can no longer slake daily world demand of over 80 million barrels a
day, the market will become paralyzed at prices too high for the wheels of
commerce and even daily living in "advanced" societies. There
may be an event that appears to trigger this final energy crash, but the overall
cause will be the huge consumption on a finite planet.
The trucks will no longer pull into
Wal-Mart. Or Safeway or other food stores. The freighters bringing
packaged techno-toys and whatnot from China will have no fuel. There will
be fuel in many places, but hoarding and uncertainty will trigger outages,
violence and chaos. For only a short time will the police and military be
able to maintain order, if at all. The damage that several days' oil
shortage and outage will do will soon wreak permanent damage that starts with
companies and consumers not paying their bills and not going to work.
After an almost instant depression
seizes the modern industrialized world, and nation-states break down, the
frantic attempts of people to feed themselves, stay warm and obtain fresh water
(pumped presently via petroleum to a great extent), there will be no
rescue. Die-off begins. The least petroleum-dependent communities
will survive best. These "backward" nations will be emulated by
the scrounging survivors of the U.S. and the rest of the "developed"
world, as far as local food production will be tried -- in a paved-over, toxic
landscape by people who have lost touch with the land.
What about renewable energy and other
alternatives? They are not ready, and will never be as long as oil is
king. This is something not acknowledged by the boosters of the technofix.
When oil abdicates, no one can fill the shoes. (See Culture Change Letters
on the Technofix such as #
77.)
However, there will be replacement societies, starting with
bands, tribes and rural communities that will start cooperating with each other
as never before. The age of the bioregional country, based on cooperation
and mutual aid will begin. A main job-category will be restoration of the
land so as to provide a semblance of the diversity of food that Earth provided prior to
petroleum farming. Social structures will no longer lend themselves to
overcrowded workforces dependent on the dollar to buy goods and services from
huge, distant and unaccountable corporations. Argentina may be a guide to
post collapse society, with its egalitarian and worker/citizen controlled
systems.
Awareness of the expected peak in global oil extraction is on
the rise, but a debate on when the peak will hit has drowned out larger
questions: How hard will the loss of abundant oil hit the economy? Can the
consumer culture continue if the collapse includes die-off?
The reasons for not asking those questions in polite corporate
company -- on the mainstream news or in foundation-funded reports -- include the
blind faith in renewable energy as a cure-all, and the lack of understanding of
petroleum's hold on daily lifestyles. Even if these factors are recognized, a
news organization does not want to appear alarmist, and at the same time wants
to cling to society's myths of progress and order forever.
The prospects of mitigating peak oil or
avoiding collapse are almost nil. U.S. petroleum demand in 2004 grew at its
strongest rate in five years. In December the daily consumption of refined
oil was 21 million barrels in the U.S, a quarter of world use. The U.S. leads the industrialized world in
population growth, part of a domestic policy to assure more car and oil
sales.
More evidence of insanity by the world's biggest consumer, the
U.S., is that the breaking point is flaunted: refinery utilization rate last
year was the highest annual rate in six years at 92.8 percent of capacity.
Lower 48 output of crude oil extraction declined the most ever in 2004 since 1999, and Alaskan
production experienced its largest drop since 2000, declining 5.5 percent --
peak oil "production" happened in the U.S. over three decades ago.
With the worldwide oil
industry emulating these trends of maxing out, the still surging demand -- China
is the leader -- strains production and
hastens the day when the system can no longer accommodate growth. The Earth
cannot, as of the world oil peak in extraction, give up ever greater quantities of black gold. Most of the world
exporting companies are now reducing extraction rates due to fewer discoveries
and depleted fields. Oil
production in 18 producer countries has passed its peak and is declining faster
than previously thought: at about 1.14 million barrels a day.
In the UK, petroleum extraction
fell 22.1% in a year, reports Julian Darley of Post Carbon Institute and author
of the highly recommended 2004 book High Noon for Natural Gas. (His
UK information was originally derived from the Royal Bank of Scotland oil and
gas index for December 2004.)
"International
Energy Agency figures put the total spare capacity of all 11 countries in OPEC at
just 330,000 bpd (down from 6 million bpd in 2002). Conventional Saudi spare
capacity is zero... An IEA report from August 2004 indicates Saudi Arabia needs up to
800,000 bpd of newly discovered oil each year just to offset declining
fields and maintain its current production level." [Aljazeera] - this can't
happen, so watch for the ensuing energy crisis.
More
evidence that demand is out of control and pushing up the day of peak oil:
"There
is no spare refinery capacity, demand has outstripped all expectations." -
Deborah White, Societe Generale bank, Paris
The
world needs to produce another 2,723,530.2 barrels per day by the end of 2005
just in order to stand still, even by the IEA demand figures considered low by
analysts.
Conclusion
We live in strange times: global
warming from petroleum and other fuels is acknowledged as a certain and
extremely grave threat, but we allow "policy" to continue holding
above all else the maximum burning of petroleum. More roads are built for
the guzzling coffins on wheels, even though road-repair funds (and library
funds) go lacking as a result. The viciousness of the invasion of Iraq and
the attempt to foil the designs of the great powers should serve to wake people
up to wean themselves off petroleum. Nothing may finally tip public sentiment over to abandoning the
oil life. People have already forgotten the huge oil spill off Unalaska
Island, Alaska. But neither
genocide, climate distortion, nor loss of wildlife habitat and fisheries -- or
that more nebulous concept of peak oil -- have people thinking far ahead in the
dominant culture, except in terms of self-aggrandizement. Fortunately, the
loss of petroleum will probably mean the loss of the global culture of plastic
materialism.
Petroleum is the Great Leveler, in the sense of
"leveling" or flattening oil civilization. But petroleum will
also be the Great Leveler in terms of equalizing everyone: People will go
through a final, grasping petroleum grab with whatever funds and connections
they have, before the attempt fails for good. Then all people will have no
choice but to work together or perish. Until then, we have skewed values:
for example, when a kindly old lady drives to a shop and has her charitable
concerns, the use of oil makes her a killer of the planet and she is not
pursuing a sustainable form of transportation. Meanwhile, a mean old man
who scowls at little children who walks to the shop might be a much more
valuable citizen in a practical fashion that matters to the world.
from abrupt.org
*****
Sources: Association for
the Study of Peak Oil and Gas "ASPO" Newsletter No 50 - Feb. 2005
Energy Information Administration (U.S. Dept. of Energy)
American Petroleum Institute
Adam Porter, Aljazeera
