Peak oil - Mar 9
Click on the headline (link) for the full text.
Many more articles are available through the Energy Bulletin homepage
Chase Manhattan Predicted Peak Oil in 1956
DR, Channeling Hubbert
... all the information [about the depletion of fossil fuels] was on the table in the decade of the 1950s. Recoverable resource estimates in 1950s - which have proven to be highly accurate - indicated that we needed to be very careful with how we planned our future. Various experts including Hubbert, Pogue and Hill of Chase Manhattan Bank, and Andrew Crichton predicted that U.S. oil, natural gas, and coal resources could not possibly support a high growth economy for any reasonable length of time. A rational review of the recoverable resource estimates of the time suggests that we needed to begin a long term plan to create a sustainable society based on proven renewable energy sources.
Instead, key individuals in government, think tanks, and corporations opted to use their influence and decision making capacity to forward a perpetual high-growth economy dependent on high-grade finite fossil fuels in the hopes that technology would make low-grade resources economic over time.
... A prime example is a publication that came to the same conclusion as Hubbert’s 1956 speech and garnered even more attention from the media and policy makers - Future Growth and Financial Requirements of the World Petroleum Industry [PDF] by Joseph Pogue and Kenneth Hill of the Petroleum Department of Chase Manhattan Bank. Chase Manhattan Bank is the world’s largest financier of petroleum development projects.
The Chase Manhattan report was published February 21, 1956 for presentation at the Annual Meeting of the Petroleum Branch of the American Institute of Mining, Metallurgical and Petroleum Engineers and was reported in the New York Times. As shown in the figure below, the report concluded that US production would likely occur between 1965 - 1970 based on the assumption that only 85 billion barrels of oil would be discovered in the lower 48 states after 1956. The report also indicated that the costs associated with expanding efforts to find and produce petroleum in the United States would continue to increase and require greater capital investment in the petroleum industry.
(8 March 2008)
A PDF of the Chase-Manhattan report is available online: Future Growth and Financial Requirements of the World Petroleum Industry [PDF]
The Militarization of Energy Security
Daniel Moran and James A. Russell, Strategic Insights via SUSRIS
SUSRIS [Saudi-US Relations Information Service] would like to thank James A. Russell, Daniel Moran and the Center for Contemporary Conflict (CCC) for permission to share this article with our readers. This article originally appeared in Strategic Insights, Volume VII, Issue 1 (February 2008) and is a draft of the introductory chapter of “Energy Security and Global Politics: The Militarization of Resource Management,” edited by Daniel Moran and James A. Russell, forthcoming from Routledge (June 2008). Strategic Insights is a bi-monthly electronic journal produced by the CCC at the Naval Postgraduate School in Monterey, California. The views expressed here are those of the authors.
Oil, which sits in the foreground of the global energy picture, is a finite resource. Much remains to be discovered about the ultimate extent of global petroleum reserves, and about the economics of their exploitation. In the final analysis, however, there is no disputing that the world’s supply of oil must be depleted sooner or later. This fact casts its shadow over strategic calculations in the energy sphere.
Experts disagree about when what has come to be called “peak oil” will arrive. Some hold that it is already behind us -- that we have already used up half of mankind’s natural endowment of oil, and are on the downward slope of a curve whose theoretical bottom represents the absolute disappearance of oil as a natural resource. Most experts reject this idea, however, and in recent years estimates of available reserves have pushed the hypothetical peak of oil farther into the future, generally beyond the twenty- to fifty-year horizon that constitutes the practical limit of even the most ambitious strategic planning.
In reality the true moment of peak oil is likely to be apparent only in retrospect. At the same time, its looming presence somewhere over history’s horizon seems equally certain to be priced into the market before it actually arrives. The idea of peak oil is already becoming established as a subtext or unspoken assumption among strategists and policy-makers, and reinforces the tendency to see the energy sector as one in which especially critical threats are liable to arise. In this sense the timing of peak oil is less significant that the strategic inferences that thinking about it and getting ready for it may inspire.
Peak oil also has a derivative meaning that strategists must struggle to take into account. In theoretical terms peak oil means simply that oil ceases to be useable for present human purposes. The simplest reason for this would be that the world’s supply of oil dries up-peak oil in its most immediate sense. But mankind might reach comparable conditions by a different avenue, should conditions arise that cause all the environmental externalities associated with the use of carbon-based energy to get priced into the energy market. ...
From a market perspective there are risks on both sides of the peak oil problem. A nation that preemptively abandons a petroleum-based economy before others do so may incur additional short-term costs, as an early adopter of new and unproven technologies that place it at a disadvantage relative to competitors that hold on longer to what is still cheap and familiar. A nation that waits too long may find itself paying premium prices for a commodity that has become too scarce to burn, but must be rationed for other, more specialized purposes. The risks associated with “virtual” peak oil also include the possibility that states will attempt to coerce each other to reduce their consumption of fossil fuels (and the resulting carbon emissions), in effect re-defining environmental pollution as a form of international delinquency, perhaps even as “aggression,” toward which a strategic response is warranted.
(7 March 2008)
Also at International Analyst Network.
Life after oil
Ragan Sutterfield, Plenty
... In Kunstler’s new novel, World Made by Hand, he provides a fictional story of what might happen after oil’s collapse. In Union Grove, NY, the book’s setting, epic disasters have already happened. Oil is gone, as is long distance transportation and the goods it once brought, everything from wheat to pharmaceuticals. Islamic terrorists have destroyed Los Angeles and Washington, D.C. with nuclear weapons. Pandemic flu and encephalitis have ravaged the population, leaving no family untouched. There may be a government, but its reach is limited and its existence matters little to the residents of Union Grove. Kunstler paints a picture of a world not unlike Rome after its fall or Europe in the time of the bubonic plague.
... World Made by Hand is a powerful novel, a warning from a future we must escape. It shows the strength of a community coming together out of need, but it also shows us a lawless world of suffering. Kunstler is both a prophet and a curmudgeon, and as such he lacks the subtlety to be a fine novelist, often too ready to tell rather than show us the effects of the Long Emergency. But his vision is sharp, and whether it is told well or badly, he illuminates the world to come if we don't change our ways now.
World Made by Hand, by James Howard Kunstler, Atlantic, 317 pages, $24.00.
(7 March 2008)
The New York Times - almost but not quite
Kenneth Deffeyes, The View from Hubbert's Peak
Monday, March 3, apparently began with a tremendous boost. Internet reports, attributed to Jed Mouawad and the New York Times, contained this passage:
"Still, today's market climate is markedly different from the energy crises of the 1970s and 1980s. These were brought about by sudden interruptions in oil supplies, like the 1973 Arab oil embargo, the Iranian revolution of 1979, or the outbreak of war between Iraq and Iran in 1980. Since 2000, oil prices have more than quadrupled as strong growth in demand from the United States and Asia outstripped the ability of oil producers to increase their output."
Hot dawg! The Times in general, and Mouawad in particular, indicate that this one is different. This time, the wolf really is at the door. I sent Mouawad a congratulatory e-mail and welcomed him to membership in the Hubbert Society. I reacted too quickly.
(6 March 2008)