Peak oil – Mar 8

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Many more articles are available through the Energy Bulletin homepage

The IEA On Peak Oil
Will going negative work?
Jerome a Paris, Daily Kos

There is no shortage of oil and gas in the ground, but quenching the world’s thirst for them will call for major investment in modern technologies,” IEA Executive Director Claude Mandil said in a statement. “The hydrocarbon resources in place around the world are sufficiently abundant to sustain likely growth in the global energy system for the foreseeable future’‘. “The doomsayers are again conveying grim messages through the front pages of major newspapers.”

(IEA Executive Director Claude Mandil in Bloomberg, September 2005)

“Big oil companies like Exxon, Shell, BP or Total have a serious problem: their targets are getting scarce. The main problem for security of supply is that the world will be increasingly dependent on a shrinking number of countries. If, in addition, they cannot invest for various reasons, the war in Iraq, political or administrative brakes in Iran, we go towards big problems.”

(Claude Mandil interview, Le Monde, July 11th 2007)

What we are saying is we could have a supply crunch to 2015 if we do not see enough investments coming to the markets, if we do not see production growing at a level to compensate the declines and meet the demand, and if the oil demand growth is not dampened in the OECD countries, China and India.

(Fatih Birol, chief economist IEA, public answer during Q&A,  November 2007)

We are on the brink of a new energy order. Over the next few decades, our reserves of oil will start to run out and it is imperative that governments in both producing and consuming nations prepare now for that time. We should not cling to crude down to the last drop – we should leave oil before it leaves us. That means new approaches must be found soon.

(Fatih Birol, opinion article in The Independent, March 2 2008)

I sure hope that going negative works, because sharply increasing oil prices don’t seem to be doing the job yet. $105 oil means little when the dollar is collapsing against gold ($990 an ounce!), the euro ($1.53!) or every conceivable commodity…

We need to wean ourselves off of oil. Urgently.

Along with climate change, a collapsing economy, and the disaster in Iraq, it’s just one of the four apocalyptic disasters awaiting the new president. Who would want that job?
(7 March 2008)
Similar post from Big Gav who says the quotes came from Rembrandt.

ASPO Newsletter – March 2008 (PDF)
Colin J. Campbell, ASPO-Ireland
1012. Nuclear Energy
1013. Bush Telegraph
1014. Faulty Maths
1015. Deepwater Brasil
1016. ASPO-ITALIA
1017. The Bubble Bursts
1018. Peak Oil Video Game
1019. Mr Lawson’s awakening
1020. Queensland Government reacts to Peak Oil

(March 2008)

Boom in Asia means oil price will continue to rise above $100 a barrel
Hamish McRae, The Independent
The good news about oil is that Opec is not going to cut production; the bad news, that it will not increase it. So, oil stays above $100 a barrel? Or, thanks to the impending global downturn, falls back a bit? Or, thanks to the booming demand from Asia, continues on its upward path?

It is an issue of profound importance for at least half a dozen reasons. The most obvious is that three of the past four global downturns have been associated with a surge in the oil price – the exception being the post-2000 one, which was triggered by the ending of the dotcom boom. Another obvious one is that the prime driver behind rising global inflation is higher energy prices. A third is that for the first time since the early 1950s, increased energy costs are having a serious knock-on impact on global food prices. Fourth, since Asia seems, so far at least, to be continuing to grow despite energy strains, it is possible that this time round, slowing growth in the West will not pare back oil prices. Fifth, there are genuine concerns about long-term oil supplies and the consequences of a fossil fuel economy. And finally, energy is rewriting the global power game, shifting power away from Western Europe (excluding Norway), Japan and the United States and towards the Middle East, Russia and parts of Africa.
(6 March 2008)

Review of Kunstler’s World Made by Hand
Reihan Salam, New York Sun
James Howard Kunstler is very much a man of his time – a crankish autodidact with a deep and abiding distaste for all things newfangled, who also happens to be a blogger, and a very entertaining one at that. If you’ve ever felt plagued by the profound stupidity of others, you’ll find a kindred spirit in Mr. Kunstler, who is one of the most gifted “haters” you’ll ever have the good fortune to read.

Mr. Kunstler’s ur-subject is what he considers the essential despicableness of a civilization built on the promise of abundant cheap energy, and the soullessness and vulgarity of the chintzy pseudo-affluence that comes with it. You get the sense Mr. Kunstler would feel this way regardless of the long-term viability of an oil-driven economy, but conveniently enough he at some point fell under the sway of a cultish fringe of the Peak Oil movement, a group that claims the world’s oil is running out fast and that, as a result, the modern world is going to come crashing down around our heads.

Leaving aside the half-baked geopolitco-cranko-economic analysis that “informs” Mr. Kunstler’s vision of a Peak Oil Ragnarok …

Which leads me to Mr. Kunstler’s superb new novel, “World Made by Hand” (Atlantic Monthly Press, 336 pages, $24). Mr. Kunstler may be a self-righteous, bileful economic ignoramus, but he’s nevertheless managed to write an extraordinary, suspenseful, deeply affecting yarn that very successfully weaves together elements of science fiction, the Western, and even magical realism. Any lover of genre fiction will find much to like, despite the fact that the novel is ultimately veiled propaganda for the cause of abandoning and perhaps incinerating America’s postwar suburbs.

The world in question is our own, in a near future where – you guessed it! – the oil runs out.
(5 March 2008)
A favorable review, despite the author’s distaste for peak oil. -BA

Scraping the barrel
Derek Brower, Guardian
The predictions of the ‘peak oil’ doomsday cult have been wrong in the past – and they’re wrong again now
—
There are good reasons why the world should wean itself from oil – but the doomsday cult of peak oil isn’t one of them.

The theory has been around for as long as people have been extracting oil. It has been getting its predictions of the end wrong, repeatedly, for just as long. It’s hard to keep track, but the latest forecasts say we’ll reach the peak as early as 2010. Kenneth Deffeyes, the Princeton professor who is a doyen of the movement, even says it happened in 2005.

Just because the predictions have been wrong before doesn’t mean they’ll be wrong next time. And there is a grain of truth to peak oil theory. Oil is a finite reserve, so the more we extract, the closer we come to exhausting the resource.

The theory’s proponents – a rag-bag of geologists, green activists, Malthusians, and people who yearn for a return to some pre-industrial idyll – are struggling to increase their production and replace their reserves.

But those are spurious connections. Oil might be pricey by historical measures, but it isn’t by others. Compare, for example, the cost of a barrel of crude with a barrel of coca-cola: $100 vs $204.

… Industry studies show remaining reserves to be literally trillions of barrels greater than the figures offered by the peak oil theorists. They’re worried about getting access to the good stuff.

Derek Brower is a writer on energy and politics. He is the senior correspondent of Petroleum Economist magazine (and a frequent writer for Prospect (and other publications).
(7 March 2008)
Can’t really take this seriously. Author is recycling oil industry talking points from a year ago. Interestingly, much of the oil industry itself seems to have moved on. -BA

Life after the oil crash
Patrick White, Globe & Mail
The grab-your-gun-and-head-for-the-hills scenario goes something like this: In the next year or so, world oil production will peak and then promptly plummet, forced down by sinking reserves. While supply crashes, demand will grow. Virtually overnight, fuel will become so dear that farm tractors will go idle, people will go hungry and homes will go cold. Financial markets will collapse and social chaos will follow.

Are you ready?

The doomsday image may sound like the half-baked plot of a Schwarzenegger flick, but thousands of North Americans are taking it seriously enough to stock up on non-perishable food, recycle their own manure, build home gardens, bone up on canning techniques, even undergo “socially responsible vasectomies” to limit their energy reliance.

With the price of a barrel of oil spiking upwards of $100, the more alarmist of peak-oil buffs are buzzing that the world’s oil-dependent economy could tank in the very near future.

… Doomers come in many shades of gloom. Paul Chefurka, an Ottawa-based civil servant, identifies as a doomer but distances himself from the “buy-canned-food-and-bullets crowd.” … The concept of peak oil attracted Mr. Chefurka’s attention four years ago just as interest in the theory was flourishing online.

… Mr. Chefurka had spent much of his life denying the existence of global warming and the ills of greenhouse gases. One day, while researching greenhouse gases online, he came across several sites dedicated to peak oil. “About 30 seconds later I was a changed man,” he says. “I could see right away that they made an awfully good case.”

He immediately fell into the extreme doomer camp, adopting an “apocalyptic sense of imminent catastrophe.” He has since softened the fatalist stance and is predicting more of a protracted economic downturn. But that hasn’t stopped him from making some drastic changes to cut his oil dependency.

In recent years, he has moved from a suburban McMansion to an urban bungalow, downsized his car and curbed his air travel. He started a food garden on his small urban lot that supplies 20 per cent of his and his wife’s fare during the warmer months. What they can’t eat, they’ve started canning for the leaner winter months.

On his website, PaulChefurka.ca, he encourages readers to eat lower on the food chain, retrofit their homes and “consider not having children.” Mr. Chefurka himself has had a “socially responsible vasectomy.”

… In the mid-nineties, Patrick Déry, a physicist and energy analyst, helped establish Ecohameau de La Baie, a community near Chicoutimi, Que., made up of six straw-bale houses on a 30-acre farm where a dozen children and 10 adults experiment with living oil-free.

“We are ready to face the challenge of peak oil,” Mr. Déry says.

The idea of the eco-village is to wean families off the fuel combustion that brings food to stores and heat to homes. Residents harvest vegetables, eggs, grains, milk and meat on the farm. They use a combination of wood-burning and solar energy for heat and they’re planning to start generating electricity from a nearby waterfall. To reduce their need for outside fertilizers, all human manure is returned to the fields.

Aside from a tractor and a car pool, the families have little dependence on fossil fuels.

“Most people are not thinking of the future,” Mr. Déry says. “That’s okay. If the worst problems of peak oil ever come, they can use what we’ve learned here to make a smooth transition. We are not a hippie commune or a survivalist camp, we’re taking a serious scientific approach.”
(7 March 2008)
Paul Chefurka is known as “GliderGuider” on The Oil Drum. We have linked to his writings several times. Patrick Déry is the author of Peak Phosphorus published at Energy Bulletin. -BA

Contributor dan crawford writes:
Unfortunately, the author left out any mention of the problems with how oil reserves are reported. He also does not understand the mathematical analysis being employed to determine oil production forecasts…. which, in my opinion, is more sound than how we forecast our own weather.

Peak Oil – True or False
Stephen Lendman, Baltimore Chronicle
The arguments are so one-sided, it’s practically a given that “peak oil” is real and threatening. Or is it? This article examines both sides. It lets readers decide and deals only with supply issues, not crucial environmental ones and the need to develop alternative energy sources. First some background.

The name most associated with “peak oil” is M. King Hubbert. He became the world’s best known geologist when he worked for Houston-based Shell Oil Company from 1943 to 1964. His theory goes something like this. Oil is a finite resource. Peak oil, or Hubbert’s peak, is the point at which maximum world production is reached, after which its rate terminally declines.

… Most analysts believe US output peaked in 1970 and has since declined. Others, like economist and author F. William Engdahl, disagree. He’s been researching oil issues since the early 1970s and believes US output peaked at the time but not because of resource depletion. It’s “because Shell, Mobil, Texaco and the other partners of Saudi Aramco were flooding the US market with dirt cheap Middle East imports, tariff free, (and) at prices so low (that) many Texas domestic producers could not compete and” had to shutter their operations.

… There you have it – peak oil or vast untapped amounts of the abiotic kind awaiting new technology to access it. Readers can weigh the evidence, find more on their own, and decide what’s true or false. In the fullness of time we’ll know, but for now we must rely on our best judgment with plenty of ammunition on both sides of the argument to consider.
(6 March 2008)
Strange article ends with about a dozen paragraphs on the abiotic theory of oil, claiming that argument is between abiotic theory and fossil fuels, but that “only time will tell” what the outcome will be. In fact, abiotic theory is not really taken seriously except for a few outliers. See Richard Heinberg on Abiotic Oil.

UPDATE: Noticed that the article has appeared on several sites, including the left-wing Znet. That’s too bad, since this is not a good introduction to peak oil. -BA