Wednesday, 5 December 2007

Peak Oil: Are we all fucked?

Yes.

The great HL Mencken once said that for even the most complex, intractable problem an answer could be found that was simple, clear – and wrong. Unfortunately, in this instance the simple answer to the complex problem is right. We are all truly fucked.

Your Savant has deployed his laser-like intellect to studying the problem for some time now. While the concept of ‘peak oil’, (or Hubbert’s Peak, after Dr. Marion Hubbert who predicted it in the 1950s with stunning accuracy) was derided in some quarters, it is now accepted by virtually every responsible source.

We have passed the world’s production high point, which occurred in the middle of last year, when production was over 86 m/b/d. Since then it’s fallen to 84 m/b/d, while demand continues to increase sharply (mainly from India and China).

Think that’s serious? It is – but we’ve only scratched the surface.

Here are a few more facts to chill the spine:

World-wide discovery of oil peaked about 1968 and new discoveries – despite the hoopla you’ll see in the MSM – barely register in comparison to the rates of depletion. And not only is the amount of available oil in decline, so is the quality. This is important as lower quality oil calls for more expensive (and energy-using) processing and leads to less end product.

Consider this: Most of us today think the famous/infamous Seven Sisters (now down to four because of mergers) control the industry. But the giants of Exxon-Mobil, Shell and BP control far less than 10% of the world’s production. Who are the new owners? Our good friends are governments in such pillars of democracy as Russia, Saudi Arabia and Mexico. Sure they’ll look after us when things get tough. I'd say.

Another factor is that such producers, as their populations grow and as they get fat from oil revenues, are exporting far less, both in proportional and absolute terms. They’re keeping more and more of it for themselves and will have us all well and truly by the bollocks in short order.

Surely a small shortfall wont make much difference?

Oh, it will. It will. A prolonged shortfall between demand and supply of as little as 10 to 15 percent is enough to consign our ‘advanced’ economies to poverty. Shortfalls in production as small as 5% in the 1970s caused the price of oil to nearly quadruple. The same thing happened in California a few years ago with natural gas: a production drop of less than 5% caused prices to skyrocket by 400%.

Now put this in context: Andrew Gould, CEO of the giant oil services firm Schlumberger recently said:

An accurate average decline rate is hard to estimate, but an overall figure of 8% is not an unreasonable assumption.

Such a decline would cut global oil production by 50% in under nine years. If a 5% cut in production caused prices to triple in the 1970s, what do you think a 50% cut is going to do, especially when demand has been skyrocketing?

Nurse! Change of underwear for that gentleman please.

Ok, so we just travel less

Sorry, travel is the least of it, although, thanks to the activities of such planning luminaries as George Redmond, Liam Lawlor and Ray Burke (‘fine honest gentleman’ according to Bertie Ahearn) we have almost American-like urban sprawl which won't be countered easily, if at all.

One of the biggest problem may, surprisingly, be food. Approximately 10 calories of fossil fuels are required to produce every 1 calorie of food eaten in the West This is because food production, at every step, fertilizers, insecticides, tractors, food storage (freezing) and transport is hugely dependent on fossil fuels. And don’t forget that hundreds of millions of new gifts from God (as my mother used to describe babies) are being added to the world’s population each year.

But just about everything, plastics, computers, the list is endless, is hugely dependent on oil. If we all stopped driving it wouldn’t stave off disaster.

So is there any hope?

That's a story for another day, but basically, no. Bio fuels, wind farms etc. will only be a drop in the ocean. Nuclear power is an obvious part of the solution but this would take decades to deploy and will in any event meet only part of our requirements. Tar sands and oil shale in theory could produce enough product, but every barrel of oil so extracted could take up to three barrels of water to produce. They are low in energy content and in turn use up lots of energy in the conversion process. And of course that process would have a devastating environmental impact.

If you think we’re being swamped by the Third World now, can you imagine the dystopian nightmare that awaits us around the corner?

Why is the MSM more interested in whether Britney Spears is wearing her knickers than an existential crisis such as this? It's because the great unwashed have similar priorities. Britney's drawers and the next BB reject are what interest today's lobotomised public.

In the meantime I'm buying a gun and going on a survivalist course.

14 comments:

Anonymous said...

Terrifying if true. are you hyping it up?

rob said...

Might be a good thing in the long run. We in the West have become a bunch of pampered couch potatoes. You'd better make that gun an automatic rifle, Savant. And don't forget to put a fence of electrified razor wire around any property you own. Even protecting our spuds will probably require military hardware if these prophecies come to pass.

SAVANT said...

Seems like good advice Rob. But where will i get the electricity for the fence?

Anonymous said...

I think Savant is way off on this one. We've been having these 'existential crises' for as long as i can remember. Remember we were going to freeze to death 20 years ago, now it's the opposite. Relax, you fat slug.

SAVANT said...

You impertinant oaf! How dare you question the wisdom of your Savant. Just as well you skulk behind the anonymous refuge

Anonymous said...

I've checked out what you say and it seems correct. But I work in the oil industry for one of the majors and it's not a topic at all. SO don't know wat to believe.

Skot German said...

I am glad that the MSM is not paying attention. It gives us more time to prepare.

Rob said...

Oops, forgot about the electricity. Maybe you could have some kind of slave working a hand-cranked generator, in return for food and occasional sexual favours.

SAVANT said...

Now THAT's more like it Rob. However, let it be known that I dont give out my sexual favours easily.

Anonymous said...

Is this more hype, a bit like global warning?

Brandon said...

Dear Savant,

You are indeed very wise. I just watched The End of Suburbia, which details your forecasts. After researching and talking to a professor of physics about the bleakness about alternative sources of fuel, (solar, wind, algae that is used to be converted into energy, ethanol, etc.) I find this all very depressing. I too will be purchasing a gun if no alternative is found but I think I'll try to move to some arable land somewhere.

Brandon said...

Dear Savant,

You are indeed very wise. I just watched The End of Suburbia, which details your forecasts. After researching and talking to a professor of physics about the bleakness about alternative sources of fuel, (solar, wind, algae that is used to be converted into energy, ethanol, etc.) I find this all very depressing. I too will be purchasing a gun if no alternative is found but I think I'll try to move to some arable land somewhere.

SAVANT said...

Indeed Barndon, so do I. I just cannot undrstand why it isn't getting more attention.

dano said...

Frankly our savant is right IMHO .15 years ago we were all warned .We had two choices collectively ..the easy way or the hard way ...naturally we chose the hard way ...we're doomed idiots ...and don't look to markets to fix this problem ..instead war will be used ..i.e IRAQ .. to solve 'certain countries' energy needs .. Prediction-- BUSH will attack IRAN in March 2008
to gain control of nearby Iranian oil fields ..oh yes ..thats why he is in the middle east on a 'peace' mission..its really a war mission to garner support from his puppets ..so buy canned food now and avoid the rush..future generations will curse us as worse than the nazis