Oil supply facts, forecasts provide fuel for thought
Reviewed by Mark Hertsgaard
It used to be that only environmentalists and paranoids warned about the world running out of oil and the future it could bring: crashing economies, resource wars, social breakdown, agony at the pump. Not anymore– and certainly not this summer, with the average national price of a gallon of gasoline around $2.60 in late August, up 73cents from last year, and with Hurricane Katrina’s aftereffects bound to push prices still higher. A growing number of industry insiders believe that the era of cheap, abundant oil is ending and that governments, corporate elites and ordinary people are utterly unprepared for the challenges ahead.
Matthew R. Simmons is an investment banker with 30 years of experience advising the industry’s major players, including briefing President Bush and Vice President Cheney. How long abundant oil will last, Simmons has asserted, is “the world’s biggest serious question.” The answers he provides in “Twilight in the Desert” are nothing less than alarming– all the more so because of his pro-industry sympathies and the prodigious research and fair-minded reasoning he brings to his task.
Simmons and other petro-pessimists do not suggest that Earth will surrender its last drop of oil anytime soon. Rather, they contend that we are approaching, or beyond, “peak oil” – the point where half of a given amount of oil has been pumped out and half still remains. That may not sound bad, but history shows that the second half is much costlier and less certain to extract; the U.S. and other post-peak regions have all experienced steep production declines.
In a world where oil demand sets new records every year, the arrival of peak oil promises to bring more frequent and debilitating shortages, higher and more volatile prices, and a host of other nasty consequences. Think back to the oil shocks and gas lines of the 1970s; then imagine those shocks continuing not for months but decades. That’s life in the peak-oil future, Simmons argues, when the suburban lifestyle millions of Americans take for granted will become unsustainable.
Conventional wisdom says that the magic of the market will solve the problem: Higher prices will call forth more supply. In particular, Saudi Arabia is assumed to hold virtually inexhaustible reserves – enough, the Saudis say, to continue the current production rates (8 million to 9 million barrels per day) for another 90 years. Simmons demolishes these rosy assumptions.
The book is a page-turner, in both the positive and negative senses of the term. Like a Tom Clancy novel, “Twilight in the Desert” contains vast stretches of impenetrable technical writing that many readers will skip over. The drama that unfolds along the way, however, will keep them reading to the end. Simmons has assembled a devastatingly convincing case that Saudi Arabia is at or beyond peak. As he points out, Saudi production relies on a few gigantic oil fields; after decades of high production, these fields are exhibiting the normal signs of advanced aging (particularly the need for injections of enormous flows of water to force the remaining oil to the surface); and no new major fields have been found, despite intensive searching. It is therefore unrealistic to expect the Saudi oil miracle to continue even “for another decade or two.”
Simmons doesn’t predict exactly when Saudi oil production will decline. But he clearly fears that the world is heading for a crash and implores leaders in government and elsewhere to fast-track the development of a new energy foundation. In fact, he is so worried that, despite being a long-standing Republican, he raises the idea of redistributing revenues of future oil production from corporate to public treasuries to finance the transition.
‘The Long Emergency’
But it’s already too late for such measures, James Howard Kunstler argues in “The Long Emergency.” America’s dependence on oil is too pervasive to undo quickly, he warns; besides, none of the alternatives (except perhaps nuclear energy) can provide the concentrated amounts of energy required to run our high-tech society, especially when billions of formerly impoverished people are eager to join the party.
We face the end not only of cheap oil but of cheap fossil fuels in general, asserts Kunstler, a novelist and critic best known for his lacerating attacks on the social and environmental costs of suburbia. Even if we do decide to chart a new course, it is “a dangerous fantasy” to believe that “a smooth, seamless transition from fossil fuels to their putative replacements – hydrogen, solar power, whatever – lie just a few years ahead.” At best, the shift will take decades. What’s more, deploying new energy sources, even green ones, still requires a platform of fossil fuel: To manufacture wind turbines or solar panels takes lots of metal and electricity. In the meantime, we’ll have our hands full dealing with another unwelcome consequence of fossil-fuel dependence: the soaring temperatures, rising sea levels and mega-droughts brought by global climate change.
Kunstler takes a curmudgeon’s delight in ticking off the many extravagances humanity will have to do without in the years ahead. Say goodbye to suburbia, air travel, industrial agriculture (with its reliance on fossil fuels, from planting to harvesting to shipping) and globalization; after all, without fuel, “the cost of transport will no longer be negligible.” The future won’t be all gloomy, though: “Life will become intensely and increasingly local,” he writes, as humans relocate to “towns and small cities surrounded by intensively cultivated agricultural hinterlands.”
Not long ago, a Jeremiah like Kunstler would have been dismissed as a kook. Even now, his unrelenting pessimism about the viability of alternative energy sources and the resourcefulness of the human animal will strike many as extreme. But his book is, alas, as brilliant as it is baleful, and given the revelations of Simmons’ detective work, we disregard it at our peril.
Together, these two books cast a particularly harsh light on the current energy debate in Washington, where lawmakers fulminate against exorbitant gasoline prices and pledge an end to U.S. dependence on foreign oil. If the peak-oil prophets are right, $3 for a gallon of gas will soon sound cheap, and the real imperative is to end our dependence on oil altogether.