Fossil Fuels

The Peak Oil Crisis: Middle Eastern Chaos

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In surveying the multiple, uprisings, insurgencies, insurrections, confrontations and what have you currently going on in the Middle East, it is hard to believe that all this turmoil will not eventually find its way to our local gas pumps. In the last week the overall situation clearly has taken a turn for the worse with large numbers of Syrian insurgents infiltrating Damascus and Aleppo for the first time accompanied by the spectacular bombing of a security meeting that killed four of the regime’s top leaders.

Fool me twice, shame on me: The oil industry repackages the fake abundance story (from the late 1990s)

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Only the oil industry would now have the audacity once again to peddle a story that it has gotten wrong for more than a decade as if it were brand new. Enlisting the media and its army of paid consultants, the industry is once again telling the public that oil abundance is at hand. And, what is doubly audacious is that it is promoting this tale as oil prices hover at levels more than eight times the 1999 low.

Evidence that oil limits are leading to limits to GDP growth

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The usual assumption that economists, financial planners, and actuaries make is that future real GDP growth can be expected to be fairly similar to the average past growth rate for some historical time period. This assumption can take a number of forms–how much a portfolio can be expected to yield in a future period, or how high real (that is, net of inflation considerations) interest rates can be expected to be in the future, or what percentage of GDP the government of a country can safely borrow. But what if this assumption is wrong, and expected growth in real GDP is really declining over time?