Peak Oil News: 11/01/2008 - 12/01/2008

Sunday, November 30, 2008

Did peak oil go away? No

Brattleboro Reformer

By Tim Stevenson

With the price of oil plummeting below $50 a barrel, shedding close to $100 since July, and commensurate readings appearing at the gas pump, people have something to feel good about during an otherwise dismal economic time. Unfortunately, it may mislead the less informed to dismiss warnings about imminent peak oil as so much Y2K false alarm.

For there is a dark side to this otherwise salutary turn of events. Rather then rendering moot the question of peak oil, the falling prices of petroleum actually exacerbate it. This is because, while the current economic free fall will continue to lower demand for petroleum and drive down prices, these lower prices have also fallen below the cost of bringing new oil into production.

As the International Energy Agency (IEA) has repeatedly warned for over a year, excessively low prices will discourage investment in production, especially with the steadily rising costs of extracting and processing oil from increasingly difficult places. This lack of sufficient investment has serious implications for the future supply, once the global economy recovers from its current descent, particularly when we wrap our minds around the $26 trillion that the IEA says it will now cost over the next 20 years to keep energy flowing at its current pace.

In a Nov. 12 interview with The Times of London, Dr. Fatih Birol, the IEA's chief economist, said that fresh sources of oil equivalent
to the output of four Saudi Arabias will have to be found to provide not only the 45 million daily barrels needed to simply stand still, but the additional 20 million to keep pace with the surging demand. Noting that much of the increase would have to come from costly unconventional and environmentally dangerous sources (such as the tar sands of Alberta, Canada), Birol emphasized that the twin challenges of meeting surging energy demand, while dealing with the threat of catastrophic climate change, would require "a global energy revolution."

The IEA's fears are echoed throughout the oil industry and financial world. The Financial Times reported earlier this month that more than four out of five refinery construction projects face cancellation. The Wall Street Journal reported last month that "big oil companies are already finding it harder to maintain, let alone increase, production."

Jad Mouawad recently wrote in The New York Times, "Some analysts predict oil could fall to $30 to 40 a barrel as the world economy worsens." He goes on to cite the conservative Cambridge Energy Research Associates that estimate that "As much as 4 million barrels of future oil could be jeopardized if prices remain below $60 a barrel."

Quoting several energy executives, The Financial Times reported last month that "delays in developing projects in Russia, Angola, Nigeria, Australia and elsewhere mean there will not be enough oil available once the world economy is ready to get back on its feet."

What lends special significance to this development, however, is that it is part of a larger trend of underinvestment in the industry that predates the current drop in prices. Western oil companies have been decapitalizing in recent years, buying stock back and otherwise returning cash to shareholders, rather than exploring for large new fields that just aren't there.

Petroleum is a capital-intensive industry, where massive amounts are required just to offset depletion and to maintain production. Drilling and platform equipment has aged and is unavailable. The cost of drilling rigs has doubled in recent years. There is an alarming dearth of skilled personnel. What is the oil industry telling us with this retrenching, while it continues to reap unprecedented profits at the same time?

The fact is that the systemic conditions that drove prices to record levels have not disappeared. Oil production has "plateaued" (to use the term favored by the industry) at about 85 million barrels per day since 2005, and this at a time when prices were rising. Production is in decline in 33 or the world's 48 oil-producing countries.

In its 2008 edition of its "World Energy Outlook," the IEA took the unprecedented step of including a comprehensive study of depletion rates in the world's largest oil fields, demonstrating annual depletion rates of 10-11 percent in non-OPEC countries, and 2-3 percent in OPEC members. The fact that the discovery of new fields peaked in the 1960s, and that we consume three barrels of oil for every new barrel discovered means that these smaller, new fields can't compensate for the decline in production in older fields.

As Lawrence Eagles, an energy analyst at JP Morgan, recently observed in typical business understatement, "the fact is that supply side problems in oil have not completely gone away."

When you combine the "plateauing" in production over the last three years, peak oil author Richard Heinberg has opined, with the ongoing depletion and rising decline rates in the oil fields, we may have already reached the all-time peak this past July. If this is true, then the country is going to have to adjust quickly to steadily decreasing amounts of oil.

Given that we are totally, utterly, completely dependent on fossil fuels for our being, this fundamental change will necessitate a massive overhaul of the U.S. economy including transportation, lifestyles, jobs, agriculture, and industrial production. Think Apollo Project, squared.

While enjoying this respite from high oil prices, we should also seize it as an opportunity to address what needs to be done, as rapidly as possible, so we can reasonably transition into the post-petroleum age we have irrevocably entered.

Tim Stevenson is a community organizer with Post Oil Solutions

Crude mathematics

A plunging oil price means cheaper petrol now – and no fuel later as industry investment shrivels

By Michael Meacher

A snip at $48.50. Now that the price of a barrel of benchmark Brent crude continues to fall like a stone in the global recession, a drop of no less than two-thirds since the high point of $147.50 just four months ago, the relief is huge among motorists and hard-pressed consumers.

Conversely, for the oil-producing countries (especially Russia, Iran, Saudi Arabia, the UAE and Venezuela) it is potentially cataclysmic, though some, such as the US, may rejoice at that. But there is another dimension to this oil-price slide which has been little noticed, but which long-term is extremely serious.

If oil prices remain well below a certain critical level for any significant period of time, large amounts of investment in expected oil production capacity will simply be written off, and the consequence could then be a recovery-stopping supply-side crunch within little more than two years.

That critical level is widely reckoned within the oil industry to be $90 a barrel. A current price as low as half that critical level is already forcing many companies to drop oil projects, and the banking crisis is also squeezing project financing for foreign oil companies operating in OPEC and outside.

Russia's four major energy companies – Gazprom, LUKoil, Rosneft, and TNK-BP – depend heavily on debt to finance operations, and are scaling down their investments. They have already been forced to seek an allocation of more credit to refinance their external debts. But with Russia now facing a $150bn shortfall in its spending plans for 2009 and where Russian markets have lost 70% of their value in just six months since May, it is all too likely they will be forced to slash their investments further.

The consequences of this for the EU and the UK are very serious. Since the EU gets 40% of its gas from Russia, where 70% of the gas fields are already in decline, any further major cutting-back in future oil and gas investments could act as a pincer on EU and UK energy supply. Indeed, the Russian energy industry has warned that if the decline continues, Russia may not be able to service even its own domestic gas needs by 2010 – this from a country where Gazprom is the largest extractor of gas in the world.

A prolonged slump in the oil price at below $50 a barrel will thus inevitably lead to another cycle of shortages and soaring prices. This intense price volatility is the first stage of the devil's see-saw that is likely to accompany the coming of Peak Oil, which is widely expected within the next five years.

These very sharp boom-and-bust capitalist cycles in oil may well turn out to be even more globally destabilising than the credit crunch. What is clearly needed, though sadly highly unlikely, is an international conference (perhaps as a serious offshoot from the lightweight G20 conference a week ago?) to reach a binding agreement on the oil price for a five-year period rolled forward, which might then avoid the massive overshoot in prices at both peak and nadir which we are seeing at the present time, with potentially calamitous consequences.

America's Perfect Storm: What Will You Do When It Hits?

By Frosty Wooldridge

This past week, I attended a meeting in Denver, Colorado featuring Michael Brownlee, a speaker on the fastest growing organization in the 21st century. Over 900 cities across the globe participate in preparation for the coming resource crisis. For anyone who might be concerned as to the future of this nation, you will find a plethora of information at the websites provided. Additionally, you will be able to hook-up with people in your state.

A “Perfect Storm” gathers on the horizon as Peak Oil, Economic Instability, Climate Change and Hyper-Population Growth collide within the United States. While Americans watch multiple breakdowns throughout their economic and environmental systems, a gathering citizen armada prepares for an uncertain future—that most assuredly looms on the U.S. horizon.

Dana Miller, director of the “Denver Transition Movement” in Denver, Colorado, sponsored Michael Brownlee, a man sporting swept-back silver hair and wearing John Denver glasses, to speak about how average Americans can mobilize to deal with the coming loss of cheap oil energy, called “Post Peak Oil.” With his compelling power point program, Brownlee addressed a packed house on what all Americans face in the coming decades.

“We face a Perfect Storm with the triangulation of Peak Oil, Climate Change and Economic Instability,” Brownlee said. “These converging factors create a dynamic that we are unprepared for. James Howard Kunstler addresses them in his book, “The Long Emergency.”

Brownlee demonstrated how humans on a global scale wreak havoc on the natural world by producing, “…bigger, faster and more as they eat up the land, fowl the biosphere, lose connection with the earth, sky and water--and each other. We have lost our sacred connection to all life and with spirit.”

Economic engines wreak mayhem on the natural world. However, that ravenous global economy we created runs straight toward a wall or over a cliff—take your pick as we run out of oil. Brownlee provided the audience with sobering graphs showing how world oil production hit its peak or is about to hit its peak by 2010. From that point onward, everything must contract because nothing can provide the energy that oil provided to keep hyper-population growth accelerating.

Brownlee said, “We must learn how to prepare for the future that’s about to change dramatically. We are in for some uncomfortable surprises. Economic growth will reverse course.”

He provided a website for those who remain skeptical; See Steve Andrews .

While we run face first into this growing “Hobson’s Choice”, Washington DC ‘risk mitigation’ experts demand a 20 year plan for coping with a world without cheap oil energy. As anyone with a nose on his or her face can discern, President Bush twiddled his thumbs and stuck fingers in both his ears for the past eight years—as to energy conservation or planning. He treaded water while our civilization stood nostril-deep on its tippy-toes gasping for solutions.

Brownlee told a rapt audience, “It will hit us soon and hard. We don’t have time or capital to avoid economic consequences.”

He mentioned the Hirsh Report of 2005 that somehow suffered ignominious burying at the hands of the media. Richard Heinberg, author of “Peak Everything: Century of Declines,” said, “The world has never faced a problem like this. The problem will be massive and pervasive.”

After “Peak Oil” hits in places like Saudi Arabia, Iraq and other countries exporting oil in 2008, they will export only 10 percent in the coming years. That will leave America, currently importing 60 percent of the 20 million barrels of oil it burns daily, out of luck. For more information click here.

Brownlee said, “In our plausible future, we can expect $200 a barrel by 2010 and on toward $300 a barrel. Any alternatives cannot come on line fast enough or equal the power of oil.”

To show how much energy oil provides the U.S. annually, Brownlee provided a graph of one cubic mile of oil. That’s how much the USA burns annually. That equals the same amount of energy provided by 52 nuclear power plants generating energy being built every year for 50 years or 104 operating coal-fired electrical plants built every year for 50 years or 32,000 wind turbines built every year for 50 years and in continuous operation or 91,250,000 solar panels built every year for 50 years.

In other words, oil produces dramatically incredible amounts of energy that we cannot and will not be able to duplicate in the coming years. Thus, when the oil runs out, our civilization, as they say, faces Hobson’s Choice: if we turn left, we walk over a cliff; if we turn right, we walk into quicksand.

Why hasn’t the media reported what we face? Brownlee said, “The media hasn’t caught up to science.”

Brownlee mentioned James Hanson of the Goddard Space Institute who said, “We have 10 years to change the trajectory of green house gases, yet we have done nothing.”

Brownlee addressed the third crisis, “We face an economic collapse with the U.S. dollar based on fossil fuel. Those bailouts show us on the brink of unraveling. Colin Campbell said, “The second half of the age of oil will be marked by the decline of oil and all that depend on it—world depression. It will challenge the continuation of civilized life.”

While Brownlee’s soft-spoken approach landed like a brick on a Monet painting, he talked about humanity passing through its irresponsible teens and now faces adulthood. We must be realistic as he pointed out over 900 transition communities worldwide taking action toward sustainable futures. Anyone can purchase “The Transition Handbook: From Oil Dependency to Local Resilience” by Rob Hopkins, founder of the Transition Movement.

Brownlee proposed a 12 point program for local action. You may find it at the web sites provided. Brownlee quoted Gary Snyder, “All things are possible when enough human beings realize everything is at stake.”

“This is the fastest growing most significant movement in the 21st century,” Brownlee said. “We must be creative, engaged and work at the local level. We may become more socially connected, produce of goods and food closer to home, and enjoy newly reconnected local networks.”

At the end of his presentation, Brownlee talked about reconnecting with our planet home. He spoke of changing from our individual obesity, inequality of incomes and status, high speed rat race, and fouling our planet—toward a simpler and more balanced humanity on Earth.

Brownlee said in closing, “We don’t know if it will work. If we wait for the government, it will be too late; we cannot wait for someone else to do the work for us. There will be plenty to do! We will need 50 million farmers to grow our food!”

For information on the meetings; For your state, please refer to the main web site!

The Peak Oil Crisis: Electrical Efficiency

Falls Church News-Press

By Tom Whipple

Last week the Virginia Commission on Energy and the Environment held a day long meeting to hear testimony on the future role of electricity in the commonwealth.

Representatives of the various power companies serving the state testified as to their plans and their commitment to reaching the state's goal of reducing electricity consumption by 10 percent by 2022. As it turns out, this goal turns out to be murky as nobody ever said what the 10 percent should be based on - 10 percent of current consumption so that the state is actually using 10 percent less 14 years from now, or 10 percent less than what 2022 consumption would be if no efforts to conserve electricity were undertaken. In the latter case the state could actually be burning considerably more electricity in 2022 as the state's population is expected to grow and it is likely that a lot of electric or plug-in hybrid cars will be refueling off the electric grid by then.

The most interesting presentation of the day, however, was made by a non-profit group called the American Council for an Energy Efficient Economy (ACEEE). This group believes that making the most efficient use of the electricity we already generate is the best and cheapest way to gain more electricity. While converting over to more efficient electricity consuming devices (such as compact fluorescent bulbs) is not free, the Council cites studies that replacing end user equipment, adding insulation, etc. can cost anywhere from one half to one quarter the cost of installing and fueling new electricity generating capacity. This includes wind generated electricity which gets its energy for free.

It turns out that ACEEE recently completed a detailed 170 page study of electricity consumption in Virginia and concluded that with a maximum effort, the commonwealth could save as much as 31 percent of its current electric consumption while still doing all the things we do today. They also cite policy achievable savings of 19 percent, or possibly 27 percent with more aggressive policies, which are deemed a more realistic goal rather than an all out efficiency effort. Either of these numbers amounts to some serious savings which when combined with conservation measures such as turning off power suggests that there are ways to survive and prosper while using considerably less electricity than we use today.

Part of the problem in Virginia is that it has had relatively inexpensive electricity due to readily available supplies of coal in the state and in nearby West Virginia and two large nuclear reactors that have been functioning for many years. In this situation, consumers, businesses, and governments do not have a particularly strong economic incentive to turn off lights, adjust thermostats and buy more expensive, yet more efficient, devices. As a result, Virginia consumers use a lot of electricity. The average residential customer now consumes 14,000 KwH per year which is 25 percent above the national average and the average commercial customer has increased consumption by 50 percent in the last eight years. As a result, Virginia ranks 38th out of the 50 states in terms of efficient use of electricity.

All this is about to change. The cost of new generating capacity has been rising steadily. Cheap Appalachian coal is running out. Regulatory boards have recently given the power companies substantial rate increases, are beginning to contemplate increasing the cost of electricity during high demand periods and possibly even reversing the concept that the more you use the cheaper it gets.

Although oil, coal and natural gas prices are currently in a slump due to a multiplicity of factors, over the long run they have no place to go but up and up. The limitations on carbon emissions could send electricity prices to unheard-of levels. In this environment, conservation and efficiency become the only viable option, for, in coming decades dwindling supplies of liquid fuels and eventually natural gas are going to leave us with electricity as the only viable way of powering our civilization.

The ACEEE recommends to Virginia policymakers a suite of 11 policy recommendations that the council feels the state has the power to implement and which combined will result in energy savings of 20 percent or better and savings of roughly $2 billion for electricity consumers over the next 14 years. There are, however, numerous cultural and regulatory barriers to increased efficiency. For example, why should the landlord pay for more efficient lighting and air conditioning when the tenant pays the electric bills directly?

Over half the savings from increased energy efficiency will come from industrial and business consumption and only a third from residential. The advent of smart meters and electricity prices based on time of day consumption will likely be in place within the next ten years. If the rate structure puts a very high premium on electricity consumption during peak hours, a little consumer education should be enough to encourage washing and drying late in the evening and setting air conditioners to higher settings on summer afternoons.

Most of the policy recommendations to achieve higher efficiency are simply adjustments and tightening to existing laws, codes, policies, and rate structures. For example leaving office and other lighting on all night when no one is there is a prime example of egregious waste of dwindling resources. Redrawn regulations, rate structures and building codes can do much to reduce or eliminate such waste.

Some of the energy efficiency problem is the relationship between the state and federal governments. Most state building codes that have great potential for saving energy are modeled after the national code. Here again you have the problem of who is paying for the building and who pays for the energy. It is obviously to the benefit of builders to keep their cost of construction to a minimum and argue vigorously that their industry and the economy will be destroyed by energy efficiency standards. This, of course, is a problem for the Congress to sort out. Amidst all the bluster about "energy independence" the proper decision makers will soon figure out that tougher codes and regulations are the quickest and cheapest way to make progress towards this goal.

Sunday, November 23, 2008

Exploring Civilization

Planet Thrive

By Derrick Jensen

It is customary when writing to hide one's presumptions. The hope is that readers will flow along with the narrative and get swept up by the language until by the end they've reached roughly the same conclusions as the author, never realizing that oftentimes the unstated starting point was far more important to the conclusion than the arguments themselves. For example, you hear some talking head on television ask, "How are we going to best make the U.S. economy grow?" Premise one: We want the U.S. economy to grow. Premise two: We want the U.S. economy to exist. Premise three: Who the hell is we?

I'm going to try to not slide premises by you. I want to lay them out as clearly as I can, for you to accept or reject. Part of the reason I want to do this is that the questions I'm exploring regarding civilization are the most important questions we as a culture and as individuals have ever been forced to face. I don't want to cheat. I want to convince neither you nor me unfairly (nor, for that matter, do I want to convince either of us at all), but instead to help us both better understand what to do (or not do) and how to do it (or why not). This goal will be best served by as much transparency—and honesty—as I can muster.

Some of the assertions undergirding [my] book Endgame are self-evident, some I've shown elsewhere, some I will support here. Of course I cannot list every one of my premises, since many of them are hidden even from me, or far more fundamentally are inherent in English, or the written word (books, for example, presume a beginning, middle, and end). Nonetheless, I'll try my best.

The first premise I want to mention is so obvious I'm embarrassed to have to write it down, as silly in its way as having to state that clean air or clean water are good and necessary, and as self-evident as the polluted air we breathe and water we drink. But our capacity and propensity for self-delusion—indeed the necessity of self-delusion if we're to continue to propagate this culture—means I need to be explicit. The first premise is: Civilization is not and can never be sustainable. This is especially true for industrial civilization.

Years ago I was riding in a car with friend and fellow activist George Draffan. He has influenced my thinking as much as any other one person. It was a hot day in Spokane. Traffic was slow. A long line waited at a stoplight. I asked, "If you could live at any level of technology, what would it be?"

As well as being a friend and an activist, George can be a curmudgeon. He was in one of those moods. He said, "That's a stupid question. We can fantasize about living however we want, but the only sustainable level of technology is the Stone Age. What we have now is the merest blip—we're one of only six or seven generations who ever have to hear the awful sound of internal combustion engines (especially two-cycle)—and in time we'll return to the way humans have lived for most of their existence. Within a few hundred years at most. The only question will be what's left of the world when we get there."

He's right, of course. It doesn't take a rocket scientist to figure out that any social system based on the use of nonrenewable resources is by definition unsustainable: in fact it probably takes anyone but a rocket scientist to figure this one out. The hope of those who wish to perpetuate this culture is something called "resource substitution," whereby as one resource is depleted another is substituted for it (I suppose there is at least one hope more prevalent than this, which is that if we ignore the consequences of these actions they will not exist). Of course on a finite planet this merely puts off the inevitable, ignores the damage caused in the meantime, and begs the question of what will be left of life when the last substitution has been made. Question: When oil runs out, what resource will be substituted in order to keep the industrial economy running? Unstated premises: a) equally effective substitutes exist; b) we want to keep the industrial economy running; and c) keeping it running is worth more to us (or rather to those who make the decisions) than the human and nonhuman lives destroyed by the extraction, processing, and utilization of this resource.

Similarly, any culture based on the nonrenewable use of renewable resources is just as unsustainable: if fewer salmon return each year than the year before, sooner or later none will return. If fewer ancient forests stand each year than the year before, sooner or later none will stand. Once again, the substitution of other resources for depleted ones will, some say, save civilization for another day. But at most this merely holds off the inevitable while it further damages the planet. This is what we see, for example, in the collapse of fishery after fishery worldwide: having long-since fished out the more economically valuable fish, now even so-called trash fish are being extirpated, disappearing into civilization's literally insatiable maw.

Another way to put all of this is that any group of beings (human or nonhuman, plant or animal) who take more from their surroundings than they give back will, obviously, deplete their surroundings, after which they will either have to move, or their population will crash (which, by the way, is a one sentence disproof of the notion that competition drives natural selection: if you hyper-exploit your surroundings you will deplete them and die; the only way to survive in the long run is to give back more than you take. Duh). This culture—Western Civilization—has been depleting its surroundings for six thousand years, beginning in the Middle East and expanding now to deplete the entire planet. Why else do you think this culture has to continually expand? And why else, coincident with this, do you think it has developed a rhetoric—a series of stories that teach us how to live—making plain not only the necessity but desirability and even morality of continual expansion—causing us to boldly go where no man has gone before—as a premise so fundamental as to become invisible? Cities, the defining feature of civilization, have always relied on taking resources from the surrounding countryside, meaning, first, that no city has ever been or ever will be sustainable on its own, and second, that in order to continue their ceaseless expansion cities must ceaselessly expand the areas they must ceaselessly hyperexploit. I'm sure you can see the problems this presents and the end point it must reach on a finite planet. If you cannot or will not see these problems, then I wish you the best of luck in your career in politics or business. Our collective studied-to-the-point-of-obsessive avoidance of acknowledging and acting on the surety of this end point is, especially given the consequences, more than passing strange.

Yet another way to say that this way of living is unsustainable is to point out that because ultimately the only real source of energy for the planet is the sun (the energy locked in oil, for example, having come from the sun long ago; and I'm excluding nuclear power from consideration here because only a fool would intentionally fabricate and/or refine materials that are deadly poisonous for tens or hundreds of thousands of years, especially to serve the frivolous, banal, and anti-life uses to which electricity is put: think retractable stadium roofs, supercolliders, and aluminum beer cans), any way of being that uses more energy than that currently coming from the sun will not last, because the noncurrent energy—stored in oil that could be burned, stored in trees that could be burned (stored, for that matter, in human bodies that could be burned)—will in time be used up. As we see.

I am more or less constantly amazed at the number of intelligent and well-meaning people who consistently conjure up magical means to maintain this current disconnected way of living. Just last night I received an email from a very smart woman who wrote, "I don't think we can go backward. I don't think Hunter/Gatherer is going to be it. But is it possible to go forward in a way that will bring us around the circle back to sustainability?"

It's a measure of the dysfunction of civilization that no longer do very many people of integrity believe we can or should go forward with it because it serves us well, but rather the most common argument in its favor (and this is true also for many of its particular manifestations, such as the global economy and high technology) seems to be that we're stuck with it, so we may as well make the best of a very bad situation. "We're here," the argument goes,"We've lost sustainability and sanity, so now we have no choice but to continue on this self- and other destructive path." It's as though we've already boarded the train to Treblinka, so we might as well stay on for the ride. Perhaps by chance or by choice (someone else's) we'll somehow end up somewhere besides the gas chambers.

The good news, however, is that we don't need to go "backward" to anything, because humans and their immediate evolutionary predecessors lived sustainably for at least a million years (cut off the word immediate and we can go back billions). It is not "human nature" to destroy one's habitat. If it were, we would have done so long before now, and long-since disappeared. Nor is it the case that stupidity kept (and keeps) noncivilized peoples from ordering their lives in such a manner as to destroy their habitat, nor from developing technologies (for example, oil refineries, electrical grids, and factories) that facilitate this process.

Indeed, were we to attempt a cross-cultural comparison of intelligence, maintenance of one's habitat would seem to me a first-rate measure with which to begin. In any case, when civilized people arrived in North America, the continent was rich with humans and nonhumans alike, living in relative equilibrium and sustainability. I've shown this elsewhere, as have many others, most especially the Indians themselves.

Because we as a species haven't fundamentally changed in the last several thousand years, since well before the dawn of civilization, each new child is still a human being, with the potential to become the sort of adult who can live sustainably on a particular piece of ground, if only the child is allowed to grow up within a culture that values sustainability, that lives by sustainability, that rewards sustainability, that tells itself stories reinforcing sustainability, and strictly disallows the sort of exploitation that would lead to unsustainability. This is natural. This is who we are.

In order to continue moving "forward," each child must be made to forget what it means to be human and to learn instead what it means to be civilized. As psychiatrist and philosopher R.D. Laing put it,"From the moment of birth, when the Stone Age baby confronts the twentieth-century mother, the baby is subject to these forces of violence . . . as its mother and father, and their parents and their parents before them, have been.These forces are mainly concerned with destroying most of its potentialities, and on the whole this enterprise is successful. By the time the new human being is fifteen or so, we are left with a being like ourselves, a half-crazed creature more or less adjusted to a mad world. This is normality in our present age."

This essay was excerpted from Endgame Vol 1: The Problem of Civilization, Endgame Vol 2: Resistance

Sunday, November 16, 2008

Peak Oil: Prominent Peaker Tells Allies to (Temporarily) Pipe Down

By Jeffrey Ball

The Journal’s Neil King Jr. reports: Mum’s the Word, Peakniks!

Should the deans of the peak-oil movement give the world a break and shelve their dire warnings of impending supply shortages?

So urges Robert Hirsch, one of the true eminences of the peakist crowd. Hirsch penned a seminal 2005 report for the Energy Department called “Peaking of World Oil Production” that warned of stark consequences as world oil supplies tighten, slamming the world economy. He has since lectured widely on the topic.

But with the world economy now under seige for quite different reasons, Hirsch is urging his cohorts to tone down their bleakness for a while so as not to worsen the damage.

In a memo “To The Peak Oil Community,” Hirsch recommends that the group “minimize its effort to awaken the world to the near-term dangers of world oil supply.”

His rationale is itself plenty grim. “If the realization of peak oil along with its disastrous financial implications was added to the existing mix of troubles, the added trauma could be unthinkable,” he wrote to his colleagues.

Hirsch sent his memo to a Who’s Who of the peak movement, including retired petroleum geologist Colin Campbell; investment banker Matt Simmons; Swedish peak-oil scholar Kjell Aleklett; and Steve Andrews, director of the U.S. Association for the Study of Peak Oil.

But his appeal, sent Thursday, doesn’t seem to be winning much support.

“This is a very risky time to go silent on a problem far deeper and less fixable than the financial mess,” said Simmons, author of the 2005 peakist bible “Twilight in the Desert,” which cast doubt on Saudi Arabia’s abilities to pump evermore oil. “The current price of oil is as lethal to supply as $10-a-barrel oil was a decade ago when we were all petrified about the permanence of the Asian flu that had killed any growth in oil demand.”

For others, the approach of a new administration is another reason to keep banging the drum. “We are too close to peak oil and its impacts to be able to afford making more wrong turns (e.g., ethanol from corn) in energy policy,” said Andrews.

But Hirsch argues that there may be some honor in silence. “In the near term,” he said in his memo, “keeping relatively quiet is likely the better part of valor.”

Here’s the memo in full:


The world is in the midst of the most severe financial crisis in most of our lifetimes. The economic damage that has already been wrought is considerable, and we have yet to see the bottom or the turnaround. Against this background, I suggest that the peak oil community minimize its efforts to awaken the world to the near-term dangers of world oil supply. The motivation is simple: By minimizing our efforts in the near term, we may not add fuel to the economic fires that are already burning so fiercely.

We are all aware of how disoriented governments and business are right now. Our leaders, leaders-to-be, and best minds are disoriented and seeking pathways out of the current morass. The public is in a quiet panic mode — those who were reasonably well off are less well of, and their options for action are limited. Those that have lost their jobs and/or homes are desperate. Businesses and the markets are in what might be called a free fall. If the realization of peak oil along with its disastrous financial implications was added to the existing mix of troubles, the added trauma could be unthinkable.

Like many of you, I’ve devoted my recent efforts to trying to wake the public and governments to the impending horrors of peak oil. As much as that awaking is urgently needed, continuing to press forward now is almost certainly not in the broader interest.

Many may be tempted to directly challenge the recent IEA World Energy Outlook. I am among those who were very disappointed. Pressing those concerns at this time might further the peak oil “cause,” but it could well do much more damage than any of us really intend.

Please keep up your studies and thinking, because helping the world realize the dangers of peak oil is an absolute must. In the near term, keeping relatively quiet is likely the better part of valor.

Friday, November 14, 2008

The Peak Oil Crisis: The First Rule of Holes

Falls Church News-Press

By Tom Whipple

America has dug itself into the deepest hole it has been in since 1860 when the dispute over slavery reached its zenith.

That hole took five years of war and 150 years of social discord before we could start climbing out. The current hole, reliance on fossil fuels for nearly everything, will also take many decades of hardships to work itself out.

For now however, digging our hole deeper continues everywhere. Oversized gas-guzzling automobiles continue to be built and sold by the millions. New generations of kerosene-guzzling airliners are being readied for the market. Houses and all sorts of buildings requiring excessive amounts of energy to be habitable continue to be built. Roads are being widened and lengthened. Our great national hole deepens every day.

Getting out of this hole will not be painless.

At the top of the national agenda this week is what to do with the automobile industry which employs millions, is burning through billions each month, and will be utterly bankrupt by New Years. The Democrats in Congress and the President-elect seem inclined to overturn a decision by the Bush administration and loan many billions to the manufacturers on the grounds that we can't stand by and watch millions being thrown out of work. Implicit in this loan is the assumption that Detroit will be able to heal itself someday. If, as seems likely, car sales remain close to or less than current rates for the next 6 to 12 months, then Detroit soon will be bankrupt again and the U.S. taxpayers will owe foreign central banks another $25 or $50 billion dollars.

Another place where we are digging ourselves in deeper and deeper is road building. All indications are that there is going to be much less driving in the very near future, due to a combination of a contracting economy, lower incomes, more unemployment, fewer cars, and less gas. To build or widen another mile of highway in the face of this likelihood is absurd.

Building new generations of aircraft - both civilian and military is likewise ridiculous. Air travel is already shrinking; planes are being grounded by the hundreds. While newer aircraft may reduce fuel consumption a little, there is nothing is on the horizon that will give the automotive equivalent of 100 mpg. Air travel has to be completely rethought for the nearly fuel-less 21st century.

The current versions of houses, stores, apartments and office buildings continue to be built by the millions. A tiny portion make an effort at being more fuel efficient than required by building codes, but the rest can only function in an era of cheap energy that is about to draw to a close.

Keeping America's deep hole from getting still deeper, however, is easy and need not cost very much. Simply stop building whatever is not a lot more energy efficient or soon will leave us with nearly useless devices and edifices that require large amounts of cheap energy to keep functioning.

Let's start with Detroit. If we are going to make a last and likely futile effort to bail them out, then they should simply stop building vehicles of ridiculously low efficiency right now. Take a holiday. No more SUV's, V-8 engines, large pickup trucks, RV's, recreational motor boats, ATV's etc. Should anyone still want or really need one of these dinosaurs anymore then they can readily buy them from massive current inventories that have already been built. The country should not put another ounce of resources or effort into building more of these devices which soon will only be fit for crushing.

What should Detroit do then with all the taxpayer money we are likely to be loaning them? Stop building large low efficiency vehicles; continue to build only the highest mileage vehicles they can currently produce. Redesign these vehicles for much better mileage with smaller more efficient motors. Start crash programs to build cars capable of 100 to 300 mpg -- probably some version of small plug-in hybrids. They are already out there. If Detroit can't design them fast enough, then they can license the designs from somebody - the Japanese, Chinese, entrepreneurs who already have them in the pipeline.

Set Detroit's engineers and a factory or two loose on building efficiency modification kits for the millions of recent vintage cars still on the road. Rather than scrap these machines - most have many years of useful life, let's see if we can get the mileage up so they can remain useful on a fraction of current fuel consumption. Kill the performance engines; change the gear ratios, and whatever else it takes to make them as fuel efficient as physics will allow.

The aircraft industry needs a radical overhaul. Military aircraft should get rid of the pilots which should double the performance and cut the fuel consumption markedly. Civilian aircraft designers should think lighter-than-air to get fuel consumption down to a level that might be sustainable with biofuels.

Buildings are easy - design, build and rebuild for whatever it takes to get down to zero net energy. Lots and lots of insulation, solar panels, wind generators, earth exchange heat pumps - whatever is appropriate to the locale. The national goal should be zero fossil fuel consumed in buildings. We already know how to do this. All it takes is a stroke of the federal pen to ban further construction of energy consuming buildings. If the Inuit can survive in the Arctic for millennia living at 50 below zero in igloos heated by body heat and the flame of a tiny whale oil lamp, the rest of us can figure something out too.

Well, there is a first cut at doing something about the great hole we are all in. For now, however, there is one gigantic problem. The vast majority of us, including our leaders, are not as yet willing to recognize publicly that we are in a deep, deep hole which we are digging deeper and deeper.

Be of good cheer, things are moving so fast that reality can not be far away, whether it be a plunging economy or falling oil production, the catalyst of change is coming as will the day we stop digging.

Tuesday, November 11, 2008

Oil Depletion: Obama Faces Hard Political Decisions

The Cultural Economist

By Ronald R. Cooke

Washington insiders are well aware of oil depletion. It has been the subject of at least four reports funded by the United States Government, more than a dozen books, and multiple independent reports. Congress has taken testimony. Key figures in Washington have made speeches. Although there are some differences in the details, they are trivial in comparison with the broader perspective.

It is highly probable that oil demand will exceed oil supply within the next 10 years.

If you buy heating oil, propane, gasoline, or diesel fuel, you have already become a victim of oil depletion. Fuel prices are up. And they are up because the supply of oil failed to keep up with the growing demand for oil. That led to greed driven speculation. Oil prices over $140 a barrel. Then speculators discovered recessionary forces were driving down the demand for oil. Fear immediately replaced greed. The price of oil declined. Fast.

But do not be fooled by this temporary decline in the price you pay for fuels. OPEC will curtail production until demand picks up again. The fundamental trends have not changed. The supply of oil will not keep up with the demand for oil. Higher prices and shortages are in your future.

The Washington establishment’s failure to acknowledge oil depletion is not one of ignorance. It has been a matter of political expediency. Politicians prefer to avoid bad news. Depletion means higher prices and possible shortages. Depletion adds confusion to the problems of global warming. Depletion lends support to America’s presence in Iraq. Acknowledging oil depletion creates additional stress for our political system.

Yes. Oil depletion creates a real political dilemma for Barack Obama. If he acknowledges oil depletion – Peak Oil – then he will be expected to do something about it. In order to do so, Barack will have to challenge embedded political philosophy. He will have to find a way to change public opinion without causing a political crisis for the Democrats.

It will not be easy. Acknowledging oil depletion means finding more oil resources to keep our economy going. Shortages must be avoided. Put a lid on prices. Drill everywhere. No sacred environmental cows such as ANWR or the Santa Barbra channel. Make deals for oil with whomever is in charge of the big oil nations. Control the political outcome in the Middle East. Stay in Iraq to protect America’s interests. More tough choices. High political risk.

But if Barack ignores oil depletion, then what? He runs the risk of cataclysmic failure . Why? Because it is highly likely that sometime – during his administration - shortages and high prices will decimate America’s economy. That means high unemployment. Out of control inflation. Voters will be mad as hell. Why – they will ask – did you let this happen to us?

Would Barack be less popular than George Bush? Doing nothing has its own risks.

So. What to do? Barack faces hard political decisions. Oil depletion will force his hand. One way – or the other. In the spirit of being constructive, here are four suggestions:

1. Take an integrated approach to contemporary concerns about global warming and fossil fuel depletion. Global warming and fossil fuel depletion are in fact evil twins, and if we want to make intelligent choices, we need to deal with them as a package.
2. Persuade national leaders to form an oil and natural gas consumer’s union. Start with the United States, Canada, and the European Union. Invite China and India. This will give consuming nations the leverage needed to deal with supplier cartels, and – hopefully – lead to resource sharing agreements.
3. Find a way to deal with the Middle East. These nations have most of the world’s remaining deposits of cheap oil. For the sake of world peace, we must control the outcome.
4. Create a credible energy program. One with strong management, specific objectives, adequate funding, and a time line for accomplishment. Include public policy initiatives that promote conservation and the evolution of energy conscious life styles.

There is a very long list of potential initiatives Barack could implement. Sorting through them will test his wisdom and political courage. But try he must. Oil depletion is a challenge that will not go away.

Saturday, November 08, 2008

Peak oil more dangerous than terrorism?

By Stefan Nicola

Oil production will peak in the period between 2011 and 2013, causing rising fuel prices and devastating damage to the global economy, a new report found.

The oil age is coming to an end, and sooner than most people may think. The shift to a new energy age won't be easy, and the world's economies will have to act sooner rather than later to prevent the global economy from being severe damaged -- that is the warning from a new report issued by the U.K. Industry Taskforce on Peak Oil and Energy Security, an alliance of eight British companies drawn from across the economic spectrum.

The report, titled "The Oil Crunch: Securing the UK's Energy Future," highlights the problems the global economy will face after oil has peaked and examines energy alternatives to best sustain the post-oil period. It claims peak oil is a much greater threat to Britain than terrorism and foresees oil prices much higher than this summer's $147-a-barrel peak. The report is the first multi-company alarm bell to be sounded on peak oil, an issue that has divided the energy world for decades.

OPEC governments and some oil companies argue that because of existing reserves, new findings and technological advancements, crude oil production will meet growing demand for decades to come. Others, and they have become more numerous and vocal, argue that an oil peak -- after which production will steadily and inevitably fall -- is imminent. This now includes even big oil officials.

"I think that easy oil and easy gas -- that is, fuels that are relatively cheap to produce and very easy to get to the market -- will peak somewhere in the coming 10 years," Jeroen van der Veer, chief executive officer of Shell, said in June 2008.

The report sought two expert opinions on oil supply, the first from Chris Skrebowski of Peak Oil Consulting, an industry expert known as a leading advocate of the early peak scenario, and the second from oil and gas giant Royal Dutch Shell.

Skrebowski predicts that global oil production will peak in the period between 2011 and 2013 and then decline steadily, with harder-to-extract reserves failing to fill the gap in time to avoid a supply crunch. "After 2010, meeting any incremental oil demand will be very difficult as the incremental supply is insufficient," Skrebowski writes in his analysis. "After 2010, prices are likely to rise strongly to reconcile available supply and demand." He also warns that the entire system may crumble much sooner if a number of huge, long-established oil fields go into terminal decline simultaneously.

Shell, in turn, foresees oil production to rise during the next years and then flatten by 2015; with the help of unconventional sources like tar sands, production will remain on a plateau until the 2020s, Shell predicts.

"We find it of great concern that both our risk opinion-providers agree that the age of 'easy oil' is over. If so, fast-growing alternative energy supplies become imperative, even if production flattens in 2015 as Shell suggests," the task force said, adding that, based on its own research and analysis, it was finding Skrebowski's steady decline theory "highly probable" and the collapse option "possible."

This is not because the world is running out of oil. But it's running out of cheap oil -- crude that is easily extracted and refined.

"Only the hard-to-find (oil) remains and all too often is found in the most challenging environments and the least attractive countries. While the 'easy oil' can readily be turned into large production flows to meet demand, the difficult, unconventional oils can only be mobilized slowly and expensively," the report found.

And the hard-to-find oil won't be there in time and in enough quantity to offset falling production of cheap oil and growing consumption in the developing countries.

The countries that still have reserves of cheap oil may then alter their behavior, according to Lord Ron Oxburgh, a former Shell chairman.

Countries like Saudi Arabia or Russia are "starting to regard their shrinking oil and gas resources as something to be husbanded," Oxburgh wrote in the report's foreword. "King Abdullah of Saudi Arabia recently described his response to new finds: 'No, leave it in the ground ... our children need it.' In other words, even those who have less expensive oil may wish to exploit it slowly and get the best possible price for it."

The report therefore advises the British government to take peak oil more seriously, also because its economic impact will hit Britain (and the rest of the world) as early as the next three to five years -- so earlier than climate change.

The task force, which includes the firms Arup, First, Foster & Partners, Scottish and Southern Energy (OTCPK:SOCI), Solarcentury, Stagecoach, Virgin and Yahoo!, has a series of concrete proposals to soften the crash after oil has peaked. The group wants

-- governments and companies to be more transparent about oil reserves;

-- governments to combine efforts to deal with oil depletion and climate change in the post-Kyoto climate negotiations;

-- governments to draw up their own national response plans to peak oil;

-- governments to push energy savings and renewable energy sources.

The world's governments need to act as quickly as possible, the report says.

"If we wait until an energy supply crisis is upon us before becoming serious about implementing sustainable solutions, in the ensuing dislocation we could no longer be able to muster the resources required."

Tuesday, November 04, 2008

Oil: A Bumpy Ride Ahead

World Policy Journal

By Ian Bremmer

(Excerpt) Over the next 25 years, the geopolitics ofoil will likely prove a bad news/good news story. The nearer-term bad news is that,while politically inspired upward pressure on oil prices will continue for the next several years, price fluctuations will be cyclical, undermining the sense of crisis needed for a focused global push toward the large-scale development of alternative sources of energy.


The good news is that, over the next 10 to 15 years, hydrocarbon alternatives— and the infrastructure needed to deliver them—will begin to come on line. A generation from now, global energy markets, less reliant on oil exports from dangerous places, will become much less vulnerable to the sort of system-wide political risks that can generate international upheaval.


For the next several years, political factors will continue to pressure energy prices from both the demand and supply sides. The sources of rising demand have become well known. Surging economic growth in emerging-market heavyweights like China and India has sharply increased their energy consumption, as industry in these countries expand their productive capacities—and as hundreds of millions of people move from poverty toward middle-class lifestyles.


The recent history of the automobile in China tells the story. In 1984, the first private vehicle was sold in that country. By 2006, 1,000 new cars hit the streets of Beijing every 24 hours. By the end of 2007, there were 15.2 million privately owned automobiles on the road across China. There’s plenty of room for this number to grow, because fewer than 4 percent of Chinese citizens already own a car. In fact, some forecasts suggest that there could be more than 300 million vehicles on China’s roads by 2033. Similar dramatic changes are underway in other developing countries. Sustaining and extending these economic gains will prove crucial for the long-term social and political stability of a growing number of emerging market states, and the governments of these countries know it. That’s why we can expect these trends to continue.

Click to read entire article (PDF)

Ian Bremmer, a senior fellow of the World Policy Institute, is the president of Eurasia Group, a political risk consultancy, and the author of The J Curve: A New Way to Understand Why Nations Rise and Fall (Simon & Schuster, 2006).