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Eight insights based on December 2017 energy data

Eight insights based on December 2017 energy data thumbnail

BP recently published energy data through December 31, 2017, in its Statistical Review of World Energy 2018. The following are a few points we observe, looking at the data:

[1] The world is making limited progress toward moving away from fossil fuels.

The two bands that top fossil fuels that are relatively easy to see are nuclear electric power and hydroelectricity. Solar, wind, and “geothermal, biomass, and other” are small quantities at the top that are hard to distinguish.

Figure 1. World energy consumption divided between fossil fuels and non-fossil fuel energy sources, based on data from BP 2018 Statistical Review of World Energy 2018.

Wind provided 1.9% of total energy supplies in 2017; solar provided 0.7% of total energy supplies. Fossil fuels provided 85% of energy supplies in 2017. We are moving away from fossil fuels, but not quickly.

Of the 252 million tons of oil equivalent (MTOE) energy consumption added in 2017, wind added 37 MTOE and solar added 26 MTOE. Thus, wind and solar amounted to about 25% of total energy consumption added in 2017. Fossil fuels added 67% of total energy consumption added in 2017, and other categories added the remaining 8%.

[2] World per capita energy consumption is still on a plateau.

In recent posts, we have remarked that per capita energy consumption seems to be on a plateau. With the addition of data through 2017, this still seems to be the case. The reason why flat energy consumption per capita is concerning is because oil consumption per capita normally rises, based on data since 1820.1 This is explained further in Note 1 at the end of this article. Another reference is my article, The Depression of the 1930s Was an Energy Crisis.

Figure 2. World energy consumption per capita, based on BP Statistical Review of World Energy 2018 data.

While total energy consumption is up by 2.2%, world population is up by about 1.1%, leading to a situation where energy consumption per capita is rising by about 1.1% per year. This is within the range of normal variation.

One thing that helped energy consumption per capita to rise a bit in 2017 relates to the fact that oil prices were down below the $100+ per barrel range seen in the 2011-2014 period. In addition, the US dollar was relatively low compared to other currencies, making prices more attractive to non-US buyers. Thus, 2017 represented a period of relative affordability of oil to buyers, especially outside the US.

[3] If we view the path of consumption of major fuels, we see that coal follows a much more variable path than oil and natural gas. One reason for the slight upturn in per capita energy consumption noted in [2] is a slight upturn in coal consumption in 2017.

Figure 3. World oil, coal, and natural gas consumption through 2017, based on BP Statistical Review of World Energy 2018.

Coal is different from oil and gas, in that it is more of a “drill it as you need it” fuel. In many parts of the world, coal mines have a high ratio of human labor to capital investment. If prices are high enough, coal will be extracted and consumed. If prices are not sufficiently high, coal will be left in the ground and the workers laid off. According to the BP Statistical Review of World Energy 2018, coal prices in 2017 were higher than prices in both 2015 and 2016 in all seven markets for which they provide indications. Typically, prices in 2017 were more than 25% higher than those for 2015 and 2016.

The production of oil and natural gas seems to be less responsive to price fluctuations than coal.2 In part, this has to do with the very substantial upfront investment that needs to be made. It also has to do with the dependence of governments on the high level of tax revenue that they can obtain if oil and gas prices are high. Oil exporters are especially concerned about this issue. All players want to maintain their “share” of the world market. They are reluctant to reduce production, regardless of what prices do in the short term.

[4] China is one country whose coal production has recently ticked upward in response to higher coal prices. 

Figure 4. China’s energy production by fuel, based on BP Statistical Review of World Energy 2018 data.

China has been able to bridge the gap by using an increasing amount of imported fuels. In fact, according to BP, China was the world’s largest importer of oil and coal in 2017. It was second only to Japan in the quantity of imported natural gas.

[5] China’s overall energy pattern appears worrying, despite the uptick in coal production.

Figure 5. China’s energy production by fuel plus its total energy consumption, based on BP Statistical Review of World Energy 2018 data.

If China expects to maintain its high GDP growth ratio as a manufacturing country, it will need to keep its energy consumption growth up. Doing this will require an increasing share of world exports of fossil fuels of all kinds. It is not clear that this is even possible unless other areas can ramp up their production and also add necessary transportation infrastructure.

Oil consumption, in particular, is rising quickly, thanks to rising imports. (Compare Figure 6, below, with Figure 4.)

Figure 6. China’s energy consumption by fuel, based on BP Statistical Review of World Energy 2018.

[6] India, like China, seems to be a country whose energy production is falling far behind what is needed to support planned economic growth. In fact, as a percentage, its energy imports are greater than China’s, and the gap is widening each year.

The big gap between energy production and consumption would not be a problem if India could afford to buy these imported fuels, and if it could use these imported fuels to make exports that it could profitably sell to the export market. Unfortunately, this doesn’t seem to be the case.

Figure 7. India’s energy production by fuel, together with its total energy consumption, based upon BP Statistical Review of World Energy 2018 data.

India’s electricity sector seems to be having major problems recently. The Financial Times reports, “The power sector is at the heart of a wave of corporate defaults that threatens to cripple the financial sector.” While higher coal prices were good for coal producers and helped enable coal imports, the resulting electricity is more expensive than many customers can afford.

[7] It is becoming increasingly clear that proved reserves reported by BP and others provide little useful information. 

BP provides reserve data for oil, natural gas, and coal. It also calculates R/P ratios (Reserves/Production ratios), using reported “proved reserves” and production in the latest year. The purpose of these ratios seems to be to assure readers that there are plenty of years of future production available. Current worldwide average R/P ratios are

  • Oil: 50 years
  • Natural Gas: 53 years
  • Coal: 134 years

The reason for using the R/P ratios is the fact that geologists, including the famous M. King Hubbert, have looked at future energy production based on reserves in a particular area. Thus, geologists seem to depend upon reserve data for their calculations. Why shouldn’t a similar technique work in the aggregate?

For one thing, geologists are looking at particular fields where conditions seem to be right for extraction. They can safely assume that (a) the prices will be high enough, (b) there will be adequate investment capital available and (c) other conditions will be right, including political stability and pollution issues. If we are looking at the situation more generally, the reasons why fossil fuels are not extracted from the ground seem to revolve around (a), (b) and (c), rather than not having enough fossil fuels in the ground.

Let’s look at a couple of examples. China’s coal production dropped in Figure 4 because low prices made coal extraction unprofitable in some fields. There is no hint of that issue in China’s reported R/P ratio for coal of 39.

Although not as dramatic, Figure 4 also shows that China’s oil production has dropped in recent years, during a period when prices have been relatively low. China’s R/P ratio for oil is 18, so it theoretically should have plenty of oil available. China figured out that in some cases, it could import oil more cheaply than it could produce it themselves. As a result, its production has dropped.

In Figure 7, India’s coal production is not rising as rapidly as needed to keep production up. Its R/P ratio for coal is 137. Its oil production has been declining since 2012. Its R/P for oil is shown to be 14.4 years.

Another example is Venezuela. As many people are aware, Venezuela has been having severe economic problems recently. We can see this in its falling oil production and its related falling oil exports and consumption.

Figure 8. Venezuela’s oil production, consumption and exports, based on data of BP Statistical Review of World Energy 2018.

Yet Venezuela reports the highest “Proved oil reserves” in the world. Its reported R/P ratio is 394. In fact, its proved reserves increased during 2017, despite its very poor production results. Part of the problem is that proved oil reserves are often not audited amounts, so that proved reserves can be as high as an exporting country wants to make them. Another part of the problem is that price is extremely important in determining which reserves can be extracted and which cannot. Clearly, Venezuela needs much higher prices than have been available recently to make it possible to extract its reserves. Venezuela also seems to have had low production in the 1980s when oil prices were low.

I was one of the co-authors of an academic paper pointing out that oil prices may not rise high enough to extract the resources that seem to be available. It can be found at this link: An Oil Production Forecast for China Considering Economic Limits. The problem is an affordability problem. The wages of manual laborers and other non-elite workers need to be high enough that they can afford to buy the goods and services made by the economy. If there is too much wage disparity, demand tends to fall too low. As a result, prices do not rise to the level that fossil fuel producers need. The limit on fossil fuel extraction may very well be how high prices can rise, rather than the amount of fossil fuels in the ground.

[8] Nuclear power seems to be gradually headed for closure without replacement in many parts of the world. This makes it more difficult to create a low carbon electricity supply.

A chart of nuclear electricity production by part of the world shows the following information:

Figure 9. Nuclear electric power production by part of the world, based on BP Statistical Review of World Energy 2018. FSU is “Former Soviet Union” countries.

The peak in nuclear power production took place in 2006. A big step-down in nuclear power generation took place after the Fukushima nuclear power accident in Japan in 2011. Europe now seems to be taking steps toward phasing out its nuclear power plants. If nothing else, new safety standards tend to make nuclear power plants very expensive. The high price makes it too expensive to replace aging nuclear power plants with new plants, at least in the parts of the world where safety standards are considered very important.

In 2017, wind and solar together produced about 59% as much electricity as nuclear power, on a worldwide basis. It would take a major effort simply to replace nuclear with wind and solar. The results would not provide as stable an output level as is currently available, either.

Of course, some countries will go forward with nuclear, in spite of safety concerns. Much of the recent growth in nuclear power has been in China. Countries belonging to the former Soviet Union (FSU) have been adding new nuclear production. Also, Iran is known for its nuclear power program.

Conclusion

We live in challenging times!

 

Notes:

(1) There is more than one way of seeing see that energy consumption per capita needs to rise, despite rising efficiency.

One basic issue is that enough energy consumption needs to get back to individual citizens, particularly citizens with few skills, so that they can continue to have the basic level of goods and services that they need. This includes food, clothing, housing, transportation, education and other services, such as medical services. Unfortunately, history shows that efficiency gains don’t do enough to offset several other countervailing forces that tend to offset the benefits of efficiency gains. The forces working against unskilled workers getting enough goods and services include the following:

(a) Diminishing returns ensures that an increasing share of energy supplies must be used to dig deeper wells or provide water desalination, to operate mines for all kinds of minerals, and to extract fossil fuels. This means that less of what energy that is available that can get back to workers.

(b) Governments need to grow because of promises that they have made to citizens. Retirement benefits are particularly an issue, as populations age. This takes another “cut” out of what is available.

(c) Increased use of technology tends to produce a much more hierarchical structure of the workforce. People at the top of the organization are paid significantly more than those near the bottom. Globalization tends to add to this effect. It is the low wages of those at the bottom of the hierarchy that becomes a problem because those workers cannot afford to buy the goods and services that they need to provide for themselves and their family.

(d) Increasing use of technology can often produce replacements for manual labor. For example, robots and computers can replace some jobs, leaving many would-be workers unemployed. The companies that produce the replacements for manual labor are often international companies that are difficult to tax. Governments can try to raise taxes to provide benefits to those left out by the economy because of the growing use of technology, but this simply exacerbates the problem described as (b) above.

(e) The world economy always has some countries that are doing better in terms of GDP growth than other countries. These countries are nearly always countries whose energy use per capita is growing. Current examples include China and India. If world resources per capita are flat, there must be other countries whose energy consumption per capita is falling. Examples today would include Venezuela, Greece and the UK. It is the countries with falling energy consumption per capita that have the more severe difficulties. Our networked world economy cannot get along without these failing economies.

Besides the issue of enough goods and services getting back to those with limited skills, a second basic issue is having enough energy-based goods and services to actually fulfill promises that have been made. One type of promise is debt and related interest payments. Another type of promise is that made by pension plans, whether government sponsored or available from private industry. A third type of promise is represented by asset prices available in the market place, such as prices of shares of stock and real estate prices.

The problem is that promises of all types can, in theory, be exchanged for goods and services. The stock of goods and services cannot rise very quickly, if energy consumption is only rising at the per-capita rate. Even if more money is issued, the problem becomes dividing up a not-very-rapidly growing pie into ever-smaller pieces, to try to fulfill all of the promises.

(2) With respect to oil, the one major deviation from its flat pattern occurred in the early 1980s, when world oil consumption fell by 11% between 1979 and 1983. This happened as the result of a concerted effort to change home heating and electricity production to other fuels. It also involved a change from large inefficient cars to smaller, more fuel efficient cars. After the 2007-2009 recession, there was another small step downward. This downward step may reflect less building of new homes and commercial spaces in some parts of the world, including the US.

Our Finite World by Gail Tverberg



70 Comments on "Eight insights based on December 2017 energy data"

  1. MASTERMIND on Sat, 23rd Jun 2018 11:53 am 

    Greg

    You are full of shit..You can’t handle reality..You have to post a legal disclaimer as an argument to ignore a full study..This is the exact same thing you did with the HSBC study and the German Army study..

    Poor widdle Greg is shitting his paints..Just like Davy..You old crusty boomers are the weakest of the weak..

    LMFAO!

  2. MASTERMIND on Sat, 23rd Jun 2018 11:55 am 

    ‘Peak Oil’ and the German Government

    Military Study Warns of a Potentially Drastic Oil Crisis

    The team of authors, led by Lieutenant Colonel Thomas Will, uses sometimes-dramatic language to depict the consequences of an irreversible depletion of raw materials. It warns of shifts in the global balance of power, of the formation of new relationships based on interdependency, of a decline in importance of the western industrial nations, of the “total collapse of the markets” and of serious political and economic crises.

    The study, whose authenticity was confirmed to SPIEGEL ONLINE by sources in government circles, was not meant for publication.

    http://www.spiegel.de/international/germany/peak-oil-and-the-german-government-military-study-warns-of-a-potentially-drastic-oil-crisis-a-715138.html

    Secrets, secrets are no fun..

  3. MASTERMIND on Sat, 23rd Jun 2018 11:56 am 

    I emailed Professor Douglas B Reynolds PhD, Oil and Energy Economics, University of Alaska.
    http://uaf.edu/files/som/REYNOLDS-Doug-2016-CV.pdf

    And I asked him if our upcoming oil shortage will cause a global economic collapse?
    https://imgur.com/a/rBtIrfg

    He replied;

    “Yes, it will be like that, but may be worse with other extenuating circumstances such as war or the decline of international trade. Hyperinflation as happened in the Soviet and Post Soviet economy is a certainty.”
    https://imgur.com/a/rktmHdt

  4. MASTERMIND on Sat, 23rd Jun 2018 11:57 am 

    Financial catastrophe resulting from resource depletion and a debasement of value of fiat currencies. Then a 12-month window of tyranny and government lockdown on citizens, followed by a 6-month window of absolute carnage and death. Then, a period of about 6 months of slow die-off and that’s pretty much that. Oh, and starting sometime within the next 5 years or so…

    https://imgur.com/a/pYxKa
    https://imgur.com/a/rBtIrfg

    Once the rioting and chaos break out..the government will bring the hammer down..You can run, but you can’t hide!

  5. MASTERMIND on Sat, 23rd Jun 2018 11:57 am 

    The End of the Oil Age is Imminent!

    Recently, the HSBC oil report stated that 80% of conventional oil fields were declining at a rate of 5-7% per year. This means that there will be an oil shortage of ~30 million barrels per day by 2030 and ~40 million barrels per day by 2040.
    http://www.scribd.com/document/367688629/HSBC-Peak-Oil-Report-2017

    What is mentioned far less often is that annual oil discoveries have lagged annual production since the 1980s.
    https://imgur.com/a/6dEDt

    Now, this problem has nothing to do with the recent decline in the oil price, which started in 2014. This has been an on-going problem for the past 30 years. Now, the IEA is predicting oil shortages by ~2020 due to declining exploration.
    https://www.wsj.com/articles/iea-says-global-oil-discoveries-at-record-low-in-2016-1493244000

    Here, the IEA blames this problem on the low oil price. But, this problem started in the 1980s. The problem is geological: we are running out of conventional cheap oil. Shale and tar sands are not the answer, either. Those resources are far too expensive, compared to conventional oil, because the global economy is based on cheap conventional oil. Expensive oil is not a replacement for cheap oil.

    Based upon the HSBC report and the IEA, the End of Oil Age will start around ~2020: there will be a dramatic economic depression due to exhaustion of cheap oil. This will cause a global economic collapse.

  6. MASTERMIND on Sat, 23rd Jun 2018 11:58 am 

    Existing oil reserves are scheduled to begin a catastrophic crash within 1 to 3 years. When it hits the economic and social damage will be catastrophic. The end of Western Civilization, from China to Europe, to the US, will not occur when oil runs out. The economic and social chaos will occur when supplies are merely reduced sufficiently….

    https://imgur.com/a/6dEDt
    https://arxiv.org/pdf/1708.03150.pdf
    https://www.scientificamerican.com/article/has-peak-oil-already-happened/
    http://www.sciencedirect.com/science/article/pii/S0301421509001281
    https://www.scribd.com/document/375110698/The-end-of-Peak-Oil-Why-this-topic-is-still-relevant-despite-recent-denials-Chapman-2014
    https://www.scribd.com/document/375110317/Projection-of-World-Fossil-Fuels-by-Country-Mohr-2015
    http://www.energybulletin.net/sites/default/files/Peak%20Oil_Study%20EN.pdf
    http://www.scribd.com/document/367688629/HSBC-Peak-Oil-Report-2017

  7. MASTERMIND on Sat, 23rd Jun 2018 11:59 am 

    We live in frightening times. It’s my belief that “you personally” will most likely die of starvation or conflict between 2020 to 2040.

    You will experience a collapse of human civilization, a die-off of humans, a destruction of the ecosystem, a loss of access to mined and drilled resources, and a dark age from which your descendent’s will not reemerge.

    Simple really….when the World Economy Collapses everything shuts down…the end… We’re talking about grids down all over the world and 7.5B people dropping like f*** flies in short order. The collapse will be absolutely horrible..There is no collapse or horror movie ever produced that has even come close to imagining what the collapse of BAU might look like. I’m talking about every corporation and every social program going bankrupt at once. I’m talking about people eating people. I’m talking about the Worst Catastrophe to ever happen in the history of mankind. Nothing has ever, or will ever come close…

    Sleepwalking Into The Next Oil Crisis
    https://www.forbes.com/sites/rrapier/2018/03/23/is-the-world-sleepwalking-into-an-oil-crisis/#509edc8b44cf

    According to the German Army leaked study. When the oil shortages hit, Wall street will crash, the public will lose all faith/trust in their institutions, and the global economy and world governments will collapse..
    http://www.energybulletin.net/sites/default/files/Peak%20Oil_Study%20EN.pdf

    Scientific American: Apocalypse Soon: Has Civilization Passed the Environmental Point of No Return?
    https://www.scientificamerican.com/article/apocalypse-soon-has-civilization-passed-the-environmental-point-of-no-return/

    Inside the new economic science of capitalism’s slow-burn energy collapse (Ahmed, 2017)
    https://medium.com/insurge-intelligence/the-new-economic-science-of-capitalisms-slow-burn-energy-collapse-d07344fab6be

    Peer Reviewed Study: Society Could Collapse In A Decade, Predicts Historian (Turchin, 2010)
    https://www.nature.com/articles/463608a

    NASA Peer Reviewed Study: Industrial Civilization is Headed for Irreversible Collapse (Motesharrei, 2014)
    http://www.sciencedirect.com/science/article/pii/S0921800914000615

    The Royal Society: Peer Reviewed Study, Now for the First Time A Global Collapse Appears Likely (Ehrlich, 2013)
    https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3574335/

    Peer Reviewed Study: Limits to Growth was Right. Research Shows We’re Nearing Global Collapse (Turner, 2014)
    https://www.scribd.com/document/379418787/Is-Global-Collapse-Imminent-An-Updated-Comparison-of-The-Limits-to-Growth-with-Historical-Data-Turner-2014

    Peer Reviewed Study: Financial System Supply-Chain Cross-Contagion: Global Systemic Collapse (Korowicz, 2012)
    http://www.feasta.org/wp-content/uploads/2012/06/Trade-Off1.pdf

  8. GregT on Sat, 23rd Jun 2018 12:37 pm 

    MM,

    Why would you call it a “NASA Peer Reveiwed Study”, when it is clearly not?

  9. GregT on Sat, 23rd Jun 2018 12:41 pm 

    And again MM,

    None of the reports that you continue to link support your conclusions.

  10. Cloggie on Sat, 23rd Jun 2018 1:59 pm 

    Massive anti-Brexit march in London. Much smaller counter-demonstration:

    https://youtu.be/2Ncgr1e3jN8

    http://www.dailymail.co.uk/news/article-5877171/Brussels-stop-recognising-UK-qualifications-6-300-jobs-no-deal.html

  11. Anonymous on Sun, 24th Jun 2018 5:36 am 

    Not sure what happened to Gail. This is a well done article.

    The graph of world oil consumption over time is telling. So much for the peak oil dreams of mid 2000. RIP TOD and ASPO.

  12. Antius on Sun, 24th Jun 2018 7:12 am 

    “The world is making limited progress toward moving away from fossil fuels.”

    That is hardly surprising. Economic growth is facing headwinds, because the infrastructure we have built up locks in a certain level of energy expenditure w.r.t GDP. As fossil fuel EROI declines, less resources are available for new investment into infrastructure of all kinds, both replacement infrastructure and infrastructure that is new, hence there is little economic growth. Eventually, it will become impossible to even stand still, far less grow.

    Under these circumstances, non-fossil energy sources that offer poorer net energy returns aren’t going to be much of a hit with business minded people.

    To keep up the sort of energy rich lifestyle that western countries have become accustomed to, we need a new injection of high EROI, cheap energy. Using declining surplus energy to invest in even poorer EROI energy sources will only hasten the collapse.

  13. Antius on Sun, 24th Jun 2018 7:35 am 

    “The graph of world oil consumption over time is telling. So much for the peak oil dreams of mid 2000. RIP TOD and ASPO.”

    Not so sure. On a per capita basis, we are past peak. If we could plot net energy per capita, we would definitely see a peak, with most of the burden of that decline falling on the developed world.

    I don’t think TOD was basically wrong in the things that it was saying. Most people assumed that western central banks would have more sense than to drop interest rates to zero and literally print money Weimar republic style. This delayed the crisis by up to a decade, but ensured that when it did arrive it would be far more brutal than it really had to be. The huge debt binge since them, has essentially destroyed our ability to manoeuvre. We could have used that money in ways that could have helped; instead we just burned it in a desperate attempt to keep the status quo going a bit longer. May the consequences fall on our children.

    A lot of people back in the early 2000s assumed that peak oil would play out as some kind of zombie apocalypse. It wasn’t that kind of crisis.

  14. Cloggie on Sun, 24th Jun 2018 7:47 am 

    “The world is making limited progress toward moving away from fossil fuels.”

    Real reason: economic conditions on planet earth are still favorable to the tune that Mother Earth still is able to cough up sufficient fossil fuel to enable 3.1% global growth:

    http://www.worldbank.org/en/news/press-release/2018/01/09/global-economy-to-edge-up-to-3-1-percent-in-2018-but-future-potential-growth-a-concern

    Most countries, including China, the US and the third world, prefer to enjoy this state of affairs to the max, without concerning itself too much about the consequences for the environment.

    There is no economic headwind, no depression and EROI has nothing to do with it and is not a problem in any regard. Energy is not as a cheap as it once was, but at current levels has no potential to choke of economic growth.

    N.B. currently Britain is currently pulling the ears of a canal masquerading as a country: 5-0.lol

  15. marmico on Sun, 24th Jun 2018 8:09 am 

    Energy is not as a cheap as it once was, but at current levels has no potential to choke of economic growth.

    Energy is cheap relative to GDP. In the US 2017 will rank as the 6th cheapest year since WW2.

    All the doomtard hand wringing about “no more cheap energy” is BS.

  16. twocats on Sun, 24th Jun 2018 8:35 am 

    just let me know where the nearest GDP tap is so I can work that bad boy – I’d appreciate it

    https://fred.stlouisfed.org/graph/?g=2Xa

    salaries to gdp are at, huh, lowest since WW2 what a coincidence.

  17. twocats on Sun, 24th Jun 2018 8:36 am 

    marmico – you are such a one trick pony. here’s a challenge – make a single relevant post that doesn’t use some combination of a ratio to GDP and i’ll give you a lollipop.

  18. MASTERMIND on Sun, 24th Jun 2018 9:15 am 

    Marico that is not true..

    During the mid/late 20th century (1960-1999), a barrel of oil cost $19 on average; during the years immediately prior to the Great Recession (2000-2008), the average price of a barrel of oil had increased to $47; and during the years immediately following the Great Recession (2010-2012), the average price of a barrel of oil had further increased to $81. During the same three time periods, the average price of a metric ton of copper increased from $3,085, to $3,713, to $6,817; the average price of a metric ton of iron ore increased from $36, to $57, to $124; and the average price of a metric ton of potash increased from $114, to $185, to $343. (Prices are inflation adjusted.)

    The simple fact is that we cannot grow our global economy and improve our global material living standards on $55 oil, $6,817 copper, $124 iron ore, and $343 potash like we did on $19 oil, $3,085 copper, $36 iron ore, and $114 potash. It should come as no surprise that our Non Renewable Resource-dependent global economy experienced the Great Recession during 2009. Nor should it come as a surprise that we have yet to recover from the Great Recession. Nor will our industrialized and industrializing economies ever recover, so long as price levels associated with the vast majority of Non Renewable Resources remain at their inordinately high levels.

    Source: Hamilton (2009)
    https://www.brookings.edu/bpea-articles/causes-and-consequences-of-the-oil-shock-of-2007-08/

    Source: IEA
    http://www.iea.org/textbase/npsum/high_oil04sum.pdf

    Source: IMF
    https://www.imf.org/external/pubs/ft/oil/2000/

    https://imgur.com/a/pYxKa

  19. MASTERMIND on Sun, 24th Jun 2018 9:23 am 

    twocats

    Marico is scared when the oil starts to run out here shortly, he is going to get his lollipop taken away!

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