Peak Oil News: The 'Peak Oil' Crisis

Monday, April 18, 2005

The 'Peak Oil' Crisis

Falls Church News-Press

Nicholas F. Benton

The king of doomsday scenarios is lighting up the Internet and broke into Rolling Stone magazine last week.

Forget total thermonuclear war, global warming, a direct hit by an asteroid or an invasion from Mars. This is the scariest one of all, if for no other reason than it is chillingly real and about to happen.

It has to do with the planet's exhaustion of oil.

And according to James Howard Kunstler, whose book, The Long Emergency, is due out in May and was adapted into a short essay in the April 7, 2005 edition of Rolling Stone, the effects are already beginning to be felt.

Life as we know it will begin to change drastically the minute the level of world production of oil begins to decline due to a depletion of the supply. That moment may have already arrived.
The world doesn't have to be out of oil for crisis conditions to emerge. It only has to begin to feel the effects of a diminishing supply, namely, the higher cost of getting at the resource and the growing competition over scarcity.

The United States, by far the world's biggest consumer of oil, stands to suffer the most from this. Just as the ability to extract and market oil on the planet may have peaked, China has entered the picture as a rapidly industrializing nation that has eclipsed Japan as the world's second-largest oil consumer.

Gas prices at our local service station are just beginning to reflect this reality. According to some experts, when they hit $4 a gallon, a fundamental sea change will occur, sending wave upon wave of cold shivers through the entire U.S. economy. Everything will begin to change, because everything depends on oil.

It's already the case that the stock market is in a stall and a quandary over the price of oil. Name the bottom line of a major corporation in the U.S. that will not be profoundly impacted by $4 a gallon oil. Not only will the stock market unravel, but the impact on the individual consumer, and worker, will be mammoth. Basic staples of life, not to mention luxury items, will become scarcer and much more expensive. The disparity between those who can afford to travel and everyone else will become more and more acute. There will be no solution in sight, at least not in either the short or intermediate term.

We're talking about a profound change in life as we know it. A society based on boundless resources and individual mobility will be severely contracted.

As Kunstler writes, "It has been very hard for Americans — lost in dark raptures of nonstop infotainment, recreational shopping and compulsive motoring — to make sense of the gathering forces that will fundamentally altar the terms of everyday life in our technological society. Even after the terrorist attacks of 9/11, America is still sleepwalking into the future."

The only questions are how fast and how severely the transformation will hit. But once the process begins, it will not abate but will worsen for a very long time. And every indication is that the process has begun.

There is a contrary view which says that the planet is awash with a limitless ocean of "abiotic" oil just beneath its surface. But there is no evidence. There has been no natural replenishment, for example, in fields where oil has already been extracted.

According to Kunstler, President Bush is aware of the emerging "peak oil" crisis, as it is called. Coco McPherson, in a sidebar to Kunstler's Rolling Stone piece, notes that Matthew R. Simmons, CEO of the world's largest energy investment bank and member of the President's 2001 energy task force, has briefed the president more than once.

Simmons is quoted, "Peak oil is a far more serious global and societal issue than global warming. It's been cast as something on the lunatic fringe, but it's very real."

McPherson writes, "Does Simmons think we can avoid a cataclysm? `Oh no, we're going over the brink on this,' he says. 'I just don't know how far.'"

The prospect of fighting over the dwindling resources of oil might have inspired Bush's decision to occupy Iraq, hoping to stem a potential military march westward by China, for example, in search of oil fields. But the futility of exhausting U.S. resources on the steppes of Asia would soon become evident, leaving the nation and the world challenged by the need to develop a valid, dense and abundant energy alternative to replace oil and restore global economic and political stability.

In the meantime, fasten your seatbelts.


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