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Page added on February 4, 2016
Whatever Happened to Peak Oil?
A few months from now, this blog will complete its tenth year of more-or-less-weekly publication. In words the Grateful Dead made famous, it’s been a long strange trip: much longer and stranger than I had any reason to expect, certainly, when I typed up that first essay and got it posted on what was still, to me, the alien landscape of the blogosphere.
Over the years since that first tentative post, the conversations here have strayed into some remarkably odd territory: the history of apocalyptic ideas, the nature of magic, the horror fiction of H.P. Lovecraft, and a good deal more. All through its vagaries, though, this blog’s central focus remains what it has been since shortly after its 2006 launch: the difficult but necessary task of facing up to the end of the arrival of hard limits to growth, and the collapse of all those fantasies of perpetual progress that so many people today still use to keep themselves from thinking about the future ahead of us.
That said, my longtime readers may be wondering about the relative absence in recent posts of one of the core themes of this blog’s earlier days. Yes, that would be peak oil.
For those who’ve come to this blog recently, it maybe helpful to point out that this simple phrase refers to a complicated concatenation of ideas. First, despite claims made by rap musician BoB and the few other flat-earthers out there, I think most of us are aware that the Earth is a sphere a little more than 7900 miles across. That means, among many other things, that the Earth contains a finite amount of petroleum—and this in turn means that each barrel of petroleum that gets pumped out of the ground brings us closer to the point at which there’s no more left.
Second, getting oil out of the ground isn’t just a matter of sticking an iron straw into a hydrocarbon milkshake. There aren’t big underground lakes of oil; what you’ve got instead are cracks and pores in solid rock through which oil oozes slowly. Thus production from an oil well usually starts off slowly, rises to a steady flow, and then gradually dwindles away to a trickle as the available oil runs out. Oil fields follow much the same curve: the first successful wells bring up oil, many more wells get drilled, and then you drill new wells to make up for declining production in the old ones, until eventually there are no more places to drill and you’ve got a played-out field. The point at which you can’t drill enough new wells to make up for declining production from the old ones is the point at which the output from the field peaks and begins to decline.
Third, the same thing is true of what geologists call oil provinces—these are regions, such as the Marcellus shale, where you can find a bunch of oil in a bunch of fields that all have more or less the same geology. The reason’s the same: in an oil province, just as in an oil field, production increases at first as new wells go in, then peaks and begins to decline as you run out of enough places to drill new wells to make up for the depletion of the old ones. Apply the same logic to entire countries, and to the whole Earth, and it works just as well. The phrase “peak oil” is a label for the point at which drilling new wells can’t keep up with the depletion of existing wells worldwide, and the overall production of petroleum worldwide begins to decline.
That’s all very straightforward. Back in the late 1990s, when a handful of researchers started to pay attention to the widening gap between the rate at which oil was being pumped out of existing fields and the rate at which new fields were being discovered, that straightforward logic led most of them to equally linear conclusions. At some point in the near future, they suggested, petroleum production would peak and then tip over into irreversible decline, petroleum prices would soar through the skylights, and a cascade of difficult consequences would promptly follow.
That latter point was by no means an arbitrary assumption. Petroleum then as now accounts for the largest share of global energy consumption, amounting to roughly forty per cent of all energy, including almost all the energy used in the transportation sector. Claims that petroleum products could easily be replaced by other energy sources ignored the hard reality that most other energy sources were already being used as fast as they could be extracted. Claims that imminent technological breakthroughs would surely keep any of these things from happening ignored the equally hard reality that most of those supposed breakthroughs had been tried repeatedly in the past and hadn’t worked.
All this had been discussed at great length back in the 1970s, when the United States hit its own all-time production peak and began skidding down the far side. The issue of peak oil got swept under the rug during the Reagan era and ignored by almost everyone thereafter; by the time the alarm was finally sounded again in the late 1990s, it was painfully clear that most of the time that would have been needed to get ready for peak oil had already been wasted. The result, according to most serious peak oil researchers at that time, would be a traumatic era of economic, political, and cultural turmoil in which a global civilization used to depending on oceans of cheap abundant crude oil got squeezed by steadily decreasing supplies at steadily soaring prices. That was the peak oil standard scenario.
Those of my readers who know their way around the apocalyptic end of the blogosophere, even if they weren’t paying attention at the time, will have no problem figuring out exactly what happened from that point on. Inevitably, the base case was turned into a launching pad for any number of lurid prophecies of imminent doom. The common contemporary habit of apocalypse machismo—“I can imagine a cataclysm more hideous and all-encompassing than you can!”—kicked into gear, and the resulting predictions interbred like hyperactive bunnies until the straightforward mathematics of peak oil were all but buried under a vast tottering heap of giddy fantasy.
Now of course none of those lavishly imagined catastrophes happened. That’s hardly surprising, as identical fantasies have been retailed on every imaginable provocation for decades now—swap out the modern details for their equivalents in previous eras, for that matter, and you can replace that word “decades” with “centuries” and still be correct. What did manage to surprise a good many people is that the standard scenario didn’t happen either. That’s not to say that everything was fine and dandy; as we’ll see, quite a bit of the economic, political, and social turmoil we’ve seen since 2005 or so was in fact driven by the impact of peak oil—but that impact didn’t follow the linear model that most peak oil writers expected it to follow
To understand what happened instead, it’s necessary to keep two things in mind that were usually forgotten back when the peak oil scene was at white heat, and still generally get forgotten today. The first is that while the supply of petroleum is ultimately controlled by geology, the demand for it is very powerfully influenced by market forces. Until 2004, petroleum production worldwide had been rising steadily for decades as new wells were brought on line fast enough to more than offset the depletion of existing fields. In that year, depletion began to catch up with drilling, and the price of oil began to rise steadily, and two things happened as a result.
The first of these was a massive flow of investment money into anything that could make a profit off higher oil prices. That included a great many boondoggles and quite a bit of outright fraud, but it also meant that plenty of oil wells that couldn’t make a profit when oil was $15 a barrel suddenly looked like paying propositions when the price rose to $55 a barrel. The lag time necessary to bring oil from new fields onto the market meant that the price of oil kept rising for a while, luring more investment money into the oil industry and generating a surge in future supply.
The problem was that the same spike in oil prices that brought all that new investment into the industry also had a potent impact on the consumption side of the equation. That impact was demand destruction, which can be neatly defined as the process by which those who can’t afford something stop buying it. Demand destruction also has a lag time—when the price of oil goes up, it takes a while for people to decide that higher prices are here to stay and change their lifestyles accordingly
The result was a classic demonstration of one of the ways that the “invisible hand” of the market is a good deal less benevolent than devout economists like to pretend. Take the same economic stimulus—the rising price of oil—and factor in lag times on its effects on both production and consumption, and you get a surge in new supply landing right about the time that demand starts dropping like a rock. That’s what happened in 2009, when the price of oil plunged from around $140 a barrel to around $30 a barrel in a matter of months. That’s also what happened in 2015, when prices lurched down by comparable figures for the same reason: surging supply and plunging demand hitting the oil market at the same time, after a long period when everyone assumed that the sky was the limit.
Could the bloggers and researchers in the pre-2009 peak oil scene have predicted all this in advance? Why, yes, and as a matter of fact a few of us did. The problem was that we were very much in the minority. True believers in an imminent peak oil apocalypse denounced the analysis just outlined with quite some heat, to be sure, but I also quickly lost count of the number of earnest, intelligent, well-informed people who tried to convince me that I had to be wrong and the standard scenario had to be right.
The conventional wisdom in the peak oil scene missed something else, though, and that’s had a huge impact on this most recent boom-and-bust cycle. The convenient label “petroleum” actually covers many different kinds of hydrocarbon goo, and these are found in many different kinds of rock, scattered unevenly across the surface of the planet. Some kinds of goo are cheap to extract and refine, but many more aren’t. Since oil companies are in the business of making money, they quite sensibly started out by going after the stuff that was cheap to extract and refine. When that ran out, they went after the stuff that was a little more expensive, and so on.
All this seems ordinary enough—after all, every other mineral resource has gone through the same curve; the low-grade taconite that goes into today’s iron smelters has a tiny fraction of the amount of iron per ton of ore that the lowest grades of commercially mined iron ore had a century ago. There’s a little problem here, though, which is that the difference in concentration between today’s taconite and yesterday’s better ores is made up by adding energy to the equation. It takes vastly more energy to make a steel I-beam today than it did in 1916, and most of that is a function of the fact that the lower the quality of ore, the more energy you have to invest in getting out each pound of iron from it.
This is also true of petroleum—but there’s a catch, because the point of extracting the petroleum in the first place is that you can get energy out of it. It’s at this point that we start talking about net energy.
Net energy is to energy what profit is to income. To get, let’s say, one barrel of oil equivalent (BOE) of energy, you have to invest a certain amount of energy in the process of extracting and refining it, and the amount you have to invest varies dramatically depending on what kind of hydrocarbon goo we’re talking about. What oilmen call “light sweet crude”—that is, petroleum that’s relatively high in light fractions, and free of sulfur and other contaminants—from the sort of shallow wells that built the US oil industry has a net energy of anything up to 200 to 1: in other words, less than a quart out of each 42-gallon barrel of oil goes to paying off the energy cost of extraction, and the rest is pure profit.
As you slide down the grades of hydrocarbon goo, though, that pleasant equation gets replaced by figures considerably less genial. Your average barrel of oil from a conventional US oilfield today has a net energy around 30 to 1, meaning that just under a gallon and a half of the oil in each barrel goes to pay off the energy cost of extraction. That’s still good, but it’s nothing like as good.
The surge of new petroleum that hit the oil market just in time to help drive the current crash of oil prices, though, didn’t come from 30-to-1 conventional oil wells, for the simple reason that every oil province in North America capable of bringing in that kind of yield was prospected many decades ago and is producing oil at ful tilt right now if it wasn’t drained to the bare rock long ago. What produced the surge this time was a mix of tar sands and hydrofractured shales, which are a very, very long way down the goo curve.
Neither one of them, as it happens, actually yields petroleum. From tar sands, as the name suggests, you get tar, which can be cut with solvents and shipped to special refineries where, if you’re willing to spend the money, you can break them down into the same things you can get much more cheaply from conventional crude oil. From hydrofractured shales, you get mostly very light hydrocarbons, the sort of thing that’s better suited to filling disposable lighters than it is to fueling your car. Both of these still got lumped in with conventional petroleum in the official statistics, which made it much easier for the New York Times and other highbrow propaganda outlets to pretend at the top of their lungs that peak oil doesn’t matter—there’s a rant to this effect somewhere in the Times every couple of months, which may suggest a certain basic insecurity at work, but that’s a theme for another post.
The real difficulty with the goo you get from tar sands and hydrofractured shales is that you have to put a lot more energy into getting each BOE of energy out of the ground and into usable condition than you do with conventional crude oil. The exact figures are a matter of dispute, and factoring in every energy input is a fiendishly difficult process, but it’s certainly much less than 30 to 1—and credible estimates put the net energy of tar sands and hydrofractured shales well down into single digits.
Now ask yourself this: where is the energy that has to be put into the extraction process coming from?
The answer, of course, is that it’s coming out of the same global energy supply to which tar sands and hydrofractured shales are supposedly contributing.
That’s the other half of the picture, as we stumble across the unfamiliar landscape on the far side of peak oil. The jagged landscape of booms and busts will doubtless continue for some time—it would not surprise me at all if the busts kept on coming at something like the six-year interval separating the 2009 and 2015 debacles—and each cycle will hammer the global economy in an assortment of familiar and unfamiliar ways, spreading collateral damage far and wide. Meanwhile the net energy of oil production will slide unsteadily downhill as older resources are exhausted and newer ones, with much steeper energy costs for extraction and refining, have to be brought on line to replace them.
The decline in net energy won’t be visible in the places you’d expect, either. As long as the hard facts of geology make it physically possible to do so, large volumes of “petroleum,” in some sense of that increasingly flexible word, will continue to be produced and consumed. With each year that passes, though, a larger fraction of that output will have to cycle right back into the extraction and refining process, leaving less and less available for all other uses. Thus declining net energy promises to play out over time in the form of creeping dysfunction throughout the economic sphere, in the form of neglected and abandoned infrastructure, failing institutions, a rising tide of permanent joblessness and homelessness, all papered over with an increasingly brittle layer of propaganda spewed out with equal enthusiam from the partisans of every officially acceptable point of view. (If this doesn’t sound familiar to you, dear reader, you need to get out more.)
That’s not going to reverse itself, either, because the resources that would be needed to flood the world with cheap abundant energy again don’t exist any more. We, ahem, burned them all. Again, the Earth is a sphere a little more than 7900 miles across; it never held that much in the way of concentrated energy resources in the first place, and our species squandered everything in our reach in three centuries or so of wretched excess. The cycles of contraction and dysfunction just outlined are part of the process by which that excess is going away, leaving us with, at most, roughly the same sort of access to energy and its products that our ancestors had before the Industrial Revolution.
We could have made that transition in a controlled and intelligent way, and we didn’t—but that doesn’t excuse us from having to make it anyway. It’s just that we’re being dragged kicking and screaming into the future by forces we chose to ignore but can’t evade. Peak oil is one of those forces; anthropogenic climate change, which has been discussed here extensively already, is another—and it’s another that has been bedeviled by the sort of overly linear thinking on the one hand, and apocalyptic fantasy-spinning on the other, that crippled the peak oil community’s capacity to anticipate the future.
In an upcoming post, I plan on talking about some of the broader lessons to be drawn from that failure—and in the process, I intend to deliver a good hard stomp to one of the habits of thought that did the most to land us in this mess.
30 Comments on "Whatever Happened to Peak Oil?"
shortonoil on Thu, 4th Feb 2016 7:34 am
“Thus declining net energy promises to play out over time in the form of creeping dysfunction throughout the economic sphere, in the form of neglected and abandoned infrastructure, failing institutions, a rising tide of permanent joblessness and homelessness, all papered over with an increasingly brittle layer of propaganda spewed out with equal enthusiam from the partisans of every officially acceptable point of view. (If this doesn’t sound familiar to you, dear reader, you need to get out more.)”
That is what we have been referring to as the cannibalization process that must now take place to continue producing the oil needed to keep the remaining wheels turning. Unfortunately, it results in a situation much like the farmer during a bad crop year; he winds up eating his seed corn. The modern analog to seed corn is the monetary/ financial system that enables the cannibalization process. To keep munching on next year’s dinner we need to destroy savings, productive investment, interest rates, jobs; just about the whole system that took several hundred years to put together. Let Forbes, and Bloomberg continue to tell you how wonderful everything is, and is going to be. Grab a bag of popcorn, and enjoy the show!
http://www.thehillsgroup.org/
Davy on Thu, 4th Feb 2016 7:57 am
“How The Fed Unwittingly Confirmed A Recession And A Default Cycle Are Now Inevitable”
http://www.zerohedge.com/news/2016-02-04/how-fed-unwittingly-confirmed-recession-and-default-cycle-are-now-inevitable
“DB’s Jim Reid writes, two consecutive quarters of tightening standards “has never happened before without it signalling an eventual move into recession and a notable default cycle. Once we have 2 such quarters lending standards don’t net loosen again until the start of the next cycle.”
“In other words the countdown is on, not only for the Fed to admit policy error, which Bill Dudley hinted at yesterday, but also a countdown to the admission that the US is in a recession and the long overdue collapse in the world’s most crowded (if only until recently) trade, being long the US Dollar.”
shortonoil on Thu, 4th Feb 2016 8:00 am
We took a look at the same 4,598 wells that David Hughes used in his Drill, Baby Drill report. We then took the average drilling cost for those wells, and divided by the average accumulated 7 year production of those wells. The point where they become stripper wells. The average cost per barrel produced for just drilling the well was $55.
http://www.zerohedge.com/news/2016-02-03/shale-shock-big-leg-lower-oil-coming-after-many-shale-plays-found-have-far-lower-bre
How do you get a bigger bag of popcorn around here?
http://www.thehillsgroup.org/
eugene on Thu, 4th Feb 2016 8:15 am
Unlike those who find a great joy in ridiculing “doomers”, I learned, long ago, to never ignore the potential for catastrophe. Note I use the term “potential”. Those who mindlessly ignore the potential may find themselves in that potential for which they are completely unprepared. When one heads into the unknown, such as we are now, a person damn well better have all potentials in mind and not just the ones they like.
I flew jets in the Air Force for a period of time. We spent endless hours practicing coping with potential catastrophes. In a thunderstorm over San Antonio, I had both engines flame out. Practicing for the potential of that catastrophe helped me out considerably. I performed the necessary steps to cope and both restarted. I believe the refusal to consider catastrophes is exactly what got us where we’re at.
eugene on Thu, 4th Feb 2016 8:19 am
By the way, when the jet became suddenly silent was not a good time to “grab some popcorn and enjoy the show”.
ghung on Thu, 4th Feb 2016 8:24 am
Gosh, Euge, we’re all just passengers in the back of this jet, and the pilots aren’t in control. Pass the popcorn. It’s going to be a wild ride.
baha on Thu, 4th Feb 2016 9:04 am
I’m going to jump! I have my parachute and will at least slow down before I splatt…
ghung on Thu, 4th Feb 2016 9:16 am
Best to avoid the fight altogether, eh? Get on the ground and stay there. Watch the streamers from the cheap seats as they go into a nose dive.
paulo1 on Thu, 4th Feb 2016 9:21 am
Excellent article. I was just going to send it on and comments,(plus Ron’s latest) to three buddies. I had the email all ready to go and….. why bother? I just get the same reactions of non-acceptance simply because the paradigm won’t change for these guys until they get a slap in the face. It still isn’t real to anyone else but the informed.
It simply isn’t a possibility for them. I think it is the slo-mo effect coupled with life is everyday, until it isn’t. Yet my best buddy who would be at PhD level of experience in the helicopter world (flying big twin rotary IFR) has been out of work since October along with the majority of the industry. My other bud has watched the Markets decline and shrugs it off with ‘simple correction’, etc. I used to be a resource contact for a business class and the prof now simply believes PO was an aberant construct by doomers, that modern life will only improve thanks to technology. All is well.
So, no emails. No popcorn this morning, Short. Just coffee and a trip to town for some welding project steel; a just in case because the stocks are low and I’ve run out of scrounge piles.
Hey Eugene, when I would occasionally blow a tank (in safe cruise altitude) because in my ancient bush planes fuel management on long long trips meant blowing tanks one after the other as per C of G (and sometimes the warning light gave only a second or two notice), I had an expression, “The silence is deafening”. Passengers would literally leap out of their seats when the engine quit. Of course it wasn’t turbine and a restart took about a second.
regards
curlyq3 on Thu, 4th Feb 2016 9:34 am
Humanities ever expanding numbers will require more consumption of resources to sustain that expansion … the author makes us aware that our resources are finite … I am convinced that the only reason we(society in general) spend so much time discussing “Peak” resources is that the inevitable die off that must occur is too unpleasant to imagine … any contraction in growth effects someone somewhere … as long as your not the one that can not find enough to survive, it’s a good day! … or I always liked “You don’t need to run faster than the bear, you just need to run faster than the guy with you running from the bear”
curlyq3
shortonoil on Thu, 4th Feb 2016 10:26 am
“Since oil companies are in the business of making money, they quite sensibly started out by going after the stuff that was cheap to extract and refine. When that ran out, they went after the stuff that was a little more expensive, and so on.”
The petroleum industry has gone after the best resources it could find for the last 150 years.The qualitity of what remained went down for the last 150 years. That shows up in the ERoEI graphs:
http://www.thehillsgroup.org/depletion2_009.htm
“the prof now simply believes PO was an aberant construct by doomers, that modern life will only improve thanks to technology.”
Some people can convince themselves that an anvil falling out of a sixth story window is not likely to be detrimental to their health. The light at the end of the tunnel can never be a train. A person can only waste so much time tying to push on that string. Conditioning can easily take precedence to reason. The technology fairy is fed in heaping scoops to most people from the day they are borne.
penury on Thu, 4th Feb 2016 10:34 am
Good comments, at least a few people can see the end game, even tho the timeline is obscure.
ghung on Thu, 4th Feb 2016 11:06 am
“…surging supply and plunging demand hitting the oil market at the same time, after a long period when everyone assumed that the sky was the limit.”
Seems it’s not just oil: The Economy’s Growing Inventory Problem
Snip: “The current business inventory-to-sales ratio is the highest that it has been since the Great Recession saw inventories rise as sales fell. In fact, it is tied for the highest level since April 2003. The inventory-to-sales ratio has been rising since the fourth quarter of 2014 and is showing no real sign of slowing down. Obviously, as we noted above, the rate of inventory growth has slowed down significantly so we can’t blame a rising inventory-to-sales ratio on rising inventories. It therefore appears that the rise in the inventory-to-sales ratio should be blamed on dropping sales.”
Good Fred graphs at the link. So much for rebounding demand.
twocats on Thu, 4th Feb 2016 11:08 am
By the way, when the jet became suddenly silent was not a good time to “grab some popcorn and enjoy the show”. [eugene]
that is an excellent point eugene. There is some divergence of responses to the emergency situation that is “the jet going silent”. For someone like short who is working at to reform major parts of our energy infrastructure this is going to require at least some cracking of the propaganda wall, for people not to be as calm as hindu cows as the plane begins its descent. Obviously there are municipal leaders out there that have seen the light and are taking appropriate action, but if “reform” is your game and not “prep for collapse” then a solid economic step-down, as horrible as it would be, is the ideal outcome. Much better than limping along into the depletion-sunset.
dave thompson on Thu, 4th Feb 2016 11:43 am
With an economy (60%)built on goods and services as in the US. We are now at the point where all the homes and apartment buildings are filled with every thing we need. Commercial real estate is overbuilt with big box stores closing and small businesses being squeezed by internet goods and services. Growth as we have come to know it is over.
rockman on Thu, 4th Feb 2016 2:19 pm
“…and plunging demand hitting the oil market at the same time…” Statements like this still baffle me given that oil buyers are acquiring more today then every before in history. All I can allow is that there was a “plunging demand” for $90+ oil and not a plunging demand for any oil.
Apneaman on Thu, 4th Feb 2016 2:37 pm
dave thompson, I have recently heard the we have everything we need argument/”peak stuff”. I’m not buying it. It’s a post hoc rationalization for why no one is buying anything in a shitty economy. If the economy was booming it would be consumer zombie central. Also, planned obsolescence expiry dates have been getting shorter every decade. Most items are not fixable and most folks don’t know how – in the trash and off to walmart, ikea or whatever. My guess is this excuse meme might be coming straight out of a neo liberal think tank like many “ideas” in the MSM. No biggie, this is actually how societies respond when the masses become impoverished. Look inward type of deal. it’s why christianity and the other axial age religions took off. A better life in the next world and all that. That’s why modernity killed religion – don’t need god when I’m always safe, have a full belly and can go to the Dr when sick. I betting we will see some of the old religions prosper again and new ones form as a response to the coming global shit storm. Same as it ever was.
If having more no longer satisfies us, perhaps we’ve reached ‘peak stuff’
http://www.theguardian.com/commentisfree/2016/jan/31/consumerism-reached-peak-stuff-search-for-happiness
ghung on Thu, 4th Feb 2016 3:05 pm
Rock; “…and plunging demand hitting the oil market at the same time…”
Greer was referencing earlier cycles (2009, etc.) more than our current cycle, although it’s clear he thinks we’ll be seeing demand destruction again soon.
marmico on Thu, 4th Feb 2016 4:41 pm
has been bedeviled by the sort of overly linear thinking on the one hand, and apocalyptic fantasy-spinning on the other, that crippled the peak oil community’s capacity to anticipate the future.
Druids have cloudy vision. They couldn’t read an energy intensity of GDP chart.
http://tinyurl.com/jhdv3dl
Go Speed Racer on Thu, 4th Feb 2016 5:17 pm
Wow. Our invisible owner, of Peak Oil website, finally spoke to us. It was a religious experience, like the parting of the clouds and s blast of choir music.
I like how he focused on falling EROEI values, as a hidden disaster that does not get acknowledged. Yes the government uses the unacknowledged falling EROEI, as a way to lie about production. When EROEI has fallen to 1:1, no net oil produced, the government will report robust oil production and all is ok. Not acknowledging falling EROEI helps the government lie about dwindling oil supplies.
marmico on Thu, 4th Feb 2016 5:40 pm
At 30 (15) EROI, 96.7 (93.4) units out of 100 units of oil move from the wellhead towards the refinery. Yep it’s a really big deal. Not. 3.3 units of net energy were lost.
And those lost 3.3 units out of 100 units of oil are probably being recaptured with increased efficiency in transportation from the wellhead to the refinery, the refinery process itself and then distribution to the gasoline station.
Boat on Thu, 4th Feb 2016 8:40 pm
apeman,
“If having more no longer satisfies us, perhaps we’ve reached ‘peak stuff’”
It’s not so much more stuff it’s just stuff lasts much longer. Like cars and trucks will last 250,000 if garaged. Back in the day 100,000 was a miracle. Houses last longer now. Industry has many more and better options in equipment. Less maintenance and more efficient.
This is why the economy will eventually stall. There is less turnover in goods and not nearly as many people needed to make it. But that doesn’t mean the standard of living has to change much. Populations have adjusted already and will adjust more as tech takes off.
makati1 on Thu, 4th Feb 2016 9:21 pm
Boat, try not maintaining your home with replacements and repairs constantly and see how long it lasts. Chipboard and foam may seem eternal, but it isn’t. Not to mention the contaminants in all of it’s components.
Few homes today are designed to last more than 20-25 years without major work. Whereas, you can find many homes that were built in the 1700s and 1800s that are still perfectly livable. Slate roofs, brick walls, etc. When the money to fix and replace is not there, those cardboard boxes will disintegrate. The appliances will have been replaced 2-3 times at ever increasing costs, and the plumbing fixtures and light switches will be failing.
I was in that industry for almost 50 years. I know what shortcuts contractors take and they are many. Profit is the name of the game and looks are all the clients cared about. Granite counter tops sitting on sawdust and plastic veneer cabinets. Fiberglass Jacuzzis and ceramic surrounds on wood stud walls and minimal floor joists. Etc.
No, most ‘homes’ will be piles of rubble within 10 years of being abandoned. They are money pits as millions are now finding out for themselves.
Alpha9 on Thu, 4th Feb 2016 9:43 pm
Another nut thinks current prices are permanent.
While the Saudi’s drain their cash reserves to continue this market share grab, and Iran has also increased it pump rate. Russia not cutting back. Looks like these countries have found a way to destroy themselves and our oil states.
However, that’s the short term.
Population Explosion still going on.
I guess the measure of a stupid man is his Time Horizon.
Clearly if you can’t remember more than 1 year in the past, and 1 minute into the future, you’re seriously mentally deficient.
Recessions are temporary.
In 1-3 years, prices will be HIGHER then 4 dollar gas the last time. If companies go bankrupt and lay off staff, and that staff gets other jobs, there cannot be a quick production recovery.
BOOM and BUST cycle.
With China and India rapidly expanding their auto fleet there will be a global resource crash.
We’re also at Peak Water and Peak ( Polluted ) Fish, as Chinese coal burning has polluted all pacific fish with unsafe amounts of mercury. And the fishing industry has over fished for 30 years.
The Prius has been on the market for at least 12 years now, and it’s still only 3% of the auto fleet.
Catastrophe is coming because Capitalism and us are too stupid to stop it.
Apneaman on Thu, 4th Feb 2016 10:06 pm
Das boat, got anything to back up yet another one of your tall tales? I’ll take a pre mid 1970’s house over any glue-lam, OSB, particle board, vinyl crap, etc. What about appliances? Washer machines, dryers, dish washers used to regularly last 15-20 with a few affordable basic repairs now and then. What do you get now? Breaking down 5 mins after the warranty expires and they hide fasteners and use uncommon screw heads that most people don’t have. How long does a smartphone last? I fix plenty of cars so don’t get me started on that scam. Lasts longer, but with more expensive repairs and many more things that break on purpose. If these cars are so great why have recall records been broken the last few years? Why does the marketing industry increase every year if stuff lasts so long?
You always claim to be an expert about capitalism, but you don’t even know what planned obsolescence is – one of the founding principles of consumer capitalism. Again boat, you are just making shit up to support your belief system and soothe your anxieties over it’s death. Sorry boaty santa’s not real either – grow up.
We’re all losers to a gadget industry built on planned obsolescence
The current model for electronics ownership means technology companies have no incentive to provide better products
http://www.theguardian.com/sustainable-business/2015/mar/23/were-are-all-losers-to-gadget-industry-built-on-planned-obsolescence
Furious iPhone 4S owners sue Apple for $5M, alleging iOS 9 crippled their phones
http://www.digitaltrends.com/mobile/iphone-4s-planned-obsolescence-lawsuit/
Planned Obsolescence Documentary
“Did you know that the lifetime of light bulbs once used to last for more than 2500 hours and was reduced on purpose to just 1000 hours? Did you know that nylon stockings once used to be that stable that you could even use them as tow rope for cars and its quality was reduced just to make sure that you will soon need a new one? Did you know that you might have a tiny little chip inside your printer that was just placed there so that your device will break after a predefined number of printed pages thereby assuring that you buy a new one? Did you know that Apple originally did not intend to offer any battery exchange service for their iPods/iPhones/iPads just to enable you to continuously contribute to the growth of this corporation?
This strategy was maybe first thought through already in the 19th century and later on for example motivated by Bernhard London in 1932 in his paper Ending the Depression Through Planned Obsolescence. The intentional design and manufacturing of products with a limited lifespan to assure repeated purchases is denoted as planned/programmed obsolescence and we are all or at least most of us upright and thoroughly participating in this doubtful endeavor. Or did you not recently think about buying a new mobile phone / computer / car / clothes / because your old one unexpectedly died or just because of this very cool new feature that you oh so badly need?”
https://vimeo.com/55490083
GregT on Thu, 4th Feb 2016 10:30 pm
Boat,
“It’s not so much more stuff it’s just stuff lasts much longer.”
You make absolutely no sense at all. You are one extremely messed up individual.
Go Speed Racer on Fri, 5th Feb 2016 1:56 am
Marmico, nobody got upset over EROEI of 30. The point is, it is falling downwards from 100, and when it hits 10, or 5, the society will be seriously messed up. This website is about watching for Peak Oil and discovering what happens. Falling EROEI is a key impactor on all of us, ’30’ being good or bad, is not the point.
Alpha9, The article is not ‘another nut’ but is the owner of our Peak Oil website. Repent or thou will receive a thunder bolt of fury from our new mortal leader.
GregT, no insulting and picking on the other posters while our website owner is watching. You might get sent to the principal’s office.
Go Speed Racer on Fri, 5th Feb 2016 1:59 am
Hey website owner, when are you going to allow us to edit our posts? So that I can fix all the crappy typo keyboard errors generated by my crappy iPhone 6!cellphone? .
marmico on Fri, 5th Feb 2016 5:04 am
When EROI was 100, gasoline was a waste product of basic refining. Kerosene was the product demanded.
Gnarled hands, gnashing teeth. The point is that declining EROI from 30 to 15 over the last 30-50 years is a nothing burger on the supply side. Net energy at the wellhead declined only 3.4% and net energy delivered to the gasoline station may not have declined at all.
Paradoxically, LTO wellhead EROI has recently increased with the decline in rigs and completions.
Of course, when discussing EROI peakers conveniently neglect the work (miles per gallon) performed by the net energy on the demand side. Every year a unit of delivered net energy to the gasoline tank performs more work. It’s the predominant reason why the oil intensity of GDP relentlessly declines.
Davy on Fri, 5th Feb 2016 7:10 am
My Bullshit meter went UP 😮 “Of course, when discussing EROI peakers conveniently neglect the work (miles per gallon) performed by the net energy on the demand side. Every year a unit of delivered net energy to the gasoline tank performs more work.” More like the work that these machines do are a product of a much more energy intensive and complex global world that requires a significant high degree of embedded energy support to produce similar results. Cars are so complex today the average man can’t work on them. The tools are sophisticated and expensive requiring extensive training. Their cost are much higher requiring financing over multiple years. The resources and supply chains span the globe. The waste stream is higher and more damaging. Marmi, some of what you say is obviously useful argument but not a worthy “nothing burger” claim against peakers.