The peak oil problem: We may be running out sooner than we think
In recent months the term "peak oil" has begun to enter the mainstream vocabulary for the first time, yet most people are not familiar with what it really means. This is an issue that I have been deeply concerned about for a number of years, both as a writer who has focused primarily on renewable energy, and in my work with the Vermont Biofuels Association. Peak oil deserves our immediate attention. Here's why.
Peak oil is now viewed by a growing number of observers as a more imminent danger to human society than global warming. That doesn't mean that global warming isn't a serious problem. It is. But peak oil is such a threat because the modern global economy is now almost totally dependent on enormous quantities of (still) relatively cheap petroleum products or their derivatives. Anything that seriously disrupts the supply or price of oil means big trouble, and the current extreme volatility of oil prices caused by tight supplies and rising demand is already causing problems that are beginning to ripple through the national and global economies. This is just the beginning.
OK, so what does peak oil really mean? When we arrive at peak oil, we will have consumed half of the total recoverable global reserves of oil. That might not seem like such a big deal, since half the total reserves are still available. But what many people don't realize is that the first half was the easy part to find and exploit and also represented the highest quality. While the remaining half is still in the ground, it's generally much lower in quality and located in much smaller fields in, shall we say, inconvenient places like the Arctic, or under deep water. Consequently, what remains is going to be much harder and more expensive to extract and produce.
Worse yet, serious doubts have recently arisen about the size of reserves claimed by many oil companies and oil-producing nations. The massive 2004 accounting scandal involving oil giant Royal Dutch/Shell and the subsequent 22 percent (or 4.3 billion barrel) cut in the company's petroleum reserve estimates are viewed by some industry experts as just the tip of the iceberg of over-inflated reserve figures for the industry.
The main problem is that after peak production is reached, the global supply of oil will inexorably begin to decline at the same time that demand continues to increase. When the line on the chart for supply that's coming down crosses the line on the chart for demand that's going up, we will have reached what is known as the "tipping point." The huge price increases for oil predicted after we reach the "tipping point" will unquestionably lead to much higher prices for almost everything, but especially food.
Unfortunately, the onset of peak oil may arrive much sooner than most people think. The experts, as always, are divided on when this will take place. One of the most optimistic views, promoted by the U.S. Department of Energy, maintains that oil production won't peak until 2037. Most observers feel this estimate is far too optimistic, especially considering the huge increase in demand from countries like China, which overtook Japan as the world's second largest oil consumer in 2003. Renowned petroleum geologist Colin Campbell estimates that global extraction of oil will peak before 2010, probably around 2007. Geophysicist Kenneth Deffeyes says the date for maximum production will be this November. The current instability in the international oil market tends to confirm that we probably are approaching peak oil.
But the exact date may be somewhat academic. This is because if the rollover point at the top of the peak does occur within the next few years, there simply isn't enough time left to make the massive shift to the renewable energy strategies that would allow for a smooth transition from our present oil-based economy. That smooth transition would have been possible if we had started the process 10 or 20 years ago (as many environmentalists and scientists urged). But it didn't happen. Now we are simply unprepared.
A Feb. 8, 2005, report prepared for the U.S. Department of Energy titled "The Mitigation of the Peaking of World Oil Production" puts it this way, "The world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions were gradual and evolutionary. Oil peaking will be abrupt and revolutionary."
Unfortunately, we are also facing a similar dilemma with natural gas, which was supposed to be a cleaner and abundant substitute for oil and coal. It turns out that domestic supplies of natural gas are declining almost as rapidly as supplies of oil in the United States. And filling the gap with imports from Canada, or liquefied natural gas (LNG) from unstable countries overseas is, at best, a problematic — and only temporary — strategy, since natural gas (another fossil fuel) is part of the problem, rather than a long-term solution.
Hurricanes Katrina and Rita, and the damage they have recently done to the oil and natural gas infrastructure in the Gulf Coast region, have made an already bad energy situation even worse. There is no question that these record-breaking hurricanes are the product of global warming. And there is also no longer any question in the minds of virtually every responsible scientist around the world that global warming is the unfortunate (but predictable) result of our excessive burning of fossil fuels.
However, these hurricanes are not the cause of our energy problems. The problems we now face are due to decades of bad planning and bad choices regarding energy at the national level. The Gulf Coast hurricanes were simply one of any number of possible trigger events that have pushed us over the edge — and into the early stages of what James Howard Kunstler aptly describes as "the long emergency" in his 2005 book with the same title (recommended reading).
I urge everyone to become educated about peak oil, and to start thinking about responses at the local level that reduce our consumption of fossil fuels. As part of that process, we also need to develop a wide range of locally based renewable energy strategies that will help us to make this vital transition as soon as possible.
For more information on peak oil visit www.postcarbon.org, www.peakoil.net, or read Richard Heinberg's 2003 book, "The Party's Over." Or do a Google search on "peak oil."
Greg Pahl of Weybridge is the author of "Biodiesel: Growing a New Energy Economy" (Chelsea Green, 2005) and "Natural Home Heating: The Complete Guide to Renewable Energy Options" (Chelsea Green, 2003). He is also a founding member and current president of the Vermont Biofuels Association.