This recession is the result of prior karma, peak oil is being saved for a cameo appearance later on.

virgincrude, I read your post and then moved on, but the image of
being on a pleasantly undulating plateau kept creeping into my
mind. I have had some pleasant undulating come my way in my
life, and it was deluxe indeed, and I've experienced a few plateaus
as well. But I have never had them both together at the same time.
The 14th is soon upon us. A fine box of chocolates, a superb bottle
of vino, light all the candles in the bedroom, and then my sultry
invitation with a plastic rose clenched in my teeth: "Honey, could you come in here for a moment, I would like to take you to a
"pleasantly undulating plateau" for Valentine's day!"

...... nah! I am dreaming and way off topic, OK Moderator,
waste me, but don't let me undulate too much.

efarmer, cut down on the posting when you're high, eh? ; - ))

Just kidding, but...

... I think it is an important distinction when defining peak oil in purely geological terms as opposed to realistic access to the world's remaing oil reserves due to economic, technical and geopolitical contraints.

Certainly a lack of engineers and experienced project managers would hurt the search for new oil reserves, but that itself is not peak oil nor does it bring geological peak oil closer to fruitition. Just as I do not think you can argue convincingly that a US lead global slowdown is going to bring peak oil any closer any faster.

The price of crude is going to be a function of global demand versus available supply. Not theoretical supply, but available supply. A recession can knock the demand for crude lower, and therefore the price, but as the economy recovers then demand increases until it reaches maximum available supply again.

Future available supply in turn can be influenced by a recession if a sharp fall in crude prices leads exploration and drilling companies to put expansion plans on hold. Those time lags will effect future supply and therefore prices.

There are quite a few feedback loops between economic activity and the supply and demand of crude. But ultimately it is the oil producers economic interest to bring petroluem to market if and when it is needed. Any evidence that the world economy is slowing further is going to surely trigger OPEC to cut production because it is not in their best interest to see a repeat of the price collapse caused by previous recessions. That is a rational response to supply and demand developments, and not by itself evidence for or against peak oil.

Is peak oil causing the recession?

Washington Post Article



I'd say it is a factor. If we still had $5 oil, maybe things would be different.



And, a glimpse into the reaction (from the article above)



But, to be fair and balanced

Journalists by their nature are always trying to draw unscientific conclusions from a very small sample size that may or may not be representative of the overall population. And even if the majority of people have made bad investment decisions - or even rotten personal decisions - does that prove or disprove peak oil? I think not! Americans have been digging themselves into a financial hole since the mid-70s with their deficit spending and low personal savings rates. It is hardly surprising that they are having trouble dealing with higher interest rates, energy prices and more expensive food. They have already spent all the money they did not have in the first place. SNAFU! ; - )

Looking at it like that, it doesn't look like much. But there are other factors. For example, you have higher food prices, driven not only by bad weather, but also by higher transport and energy costs. If you added up the total increase in bills due to higher oil and gas prices, it starts to look significant.

Admittedly, the problem wouldn't be half as bad if the Americans' savings weren't so low that anything would trip them. But then, you could ask: How did this happen?

You can say it happened because the average American is greedy and stupid. Or you can take the point of view that it happened because the average American dreams to have their own home, and there were a bunch of lenders very happy to convince them that what looked like crazy mortgages were in fact, very reasonable, and a lot of people were buying houses at inflated prices with mortgages they shouldn't have taken in the first place.

Then, you can ask: But how did the housing bubble happen? As we all know, it was a consequence of some stupidly low interest rates, plus some very creative financial ideas that allowed the bubble to grow well beyond the point any other bubble would have busted.

And why did the Fed lower interest rates so much? There are many opinions about the recession the Fed was trying to avert, the most common being it was the dot com bubble. But you can also think the global imbalances played an important part. The trade deficit is supposed not to be recessionary in an environment of floating currencies, but I wonder how you can honestly say that the dollar 'floats' when so many countries were pegging themselves to the dollar, including most oil exporters.

Oil imports were a big part of the trade deficit, and I think there is a good argument that it's part of the reason the American economy has been in such a strange shape since the turn of the century. And high oil prices are definitely the thing that is going to turn this recession into something very, very nasty.

In my opinion, you can say oil dependency planted some of the seeds of this recession, and peak oil triggered it.

Doly wrote:



I doubt it simply because oil exporters have mainly been re-investing their windfall profits from higher energy prices back into US capital markets thereby keeping interest rate artificially low.



And as far as peak oil is concerned high oil prices are mainly the flipside of a lower US dollar against a basket of currencies because absolute oil and oil product demand has been rising even if slower than trend. I would certainly like to know how the rest of the world is continuing to grow in the face of peak oil declines?



As this seems to be a credit lead recession and not the result of higher energy prices?

A peak oil induced recession would have to be triggered by a supply shock in order to convince me. Higher prices caused by scarcity are not proof of peak oil. Falling production is. But energy prices are still below average relative to the cost of other assets.



Of course, you can always argue that it was the junkie's last fix that killed him, but that is to ignore years or drug use leading up to that seminal moment. The problem with looking for peak oil everywhere is that you will find it everywhere. Even when it is not!

Just my two cents! ; - )

Hey folks, it's my first post here. I've been researching peak oil on-and-off for a while now. I can't say I'm an expert yet, but I know enough about it to realize that it's a very, very serious problem.

Whenever I browse forums such as this one, though, one thing that always strikes me as surprising is the extent of belief that peak oil represents unimaginable catastrophe, mass die-off, a collapse of civilization, and a return to some primitive way of life - and the extent to which people believe this is just around the corner.

For myself, I don't doubt that dwindling oil supplies represents a major problem for the world, but I don't believe in a theory of 'collapse' either.

Right off the bat, here are a few reasons why I think we'll see more of a slow-down than a collapse:
- Alternative fuels: for example liquid-to-gas coal, oil shale/sands, biofuels, natural gas, fuel generated by algae etc. Many or all of these are problematic, of course, but together they might soften the blow of declining petroleum production.
- Alternative energy: a mixture of renewables, and more significantly nuclear, could at least cater for energy production, and perhaps in the long-term for some electric vehicles also.
- Demand destruction. People could live there lives far more efficiently and with far less consumption of energy that we have at the moment, and this could be achieved without total chaos.
- Spare capacity in the economy. Think how much time and effort is put into producing luxury goods, entertainment, and so on. If all the work put into nonessential activity was dedicated instead to food production, we'd have a much better chance of at least feeding everyone.
- The human capacity to cope with adverse circumstances. A lot of people here seem to have quite a negative view of human capabilities, that if we face difficulty we'll turn on each other and evoke a 'tragedy of the commons' as everyone tries to pursue his own survival. I don't think this is necessarily the case. There have been plenty of times in the past when populations have been galvanized to do extraordinary things economically - think WW2 - and in which a great deal was achieved in a crisis. I see no reason why this capacity shouldn't exist today; it may require state power as well, but this isn't going to collapse overnight either.

There are probably plenty of other reasons, but I'm sure you can see the point I'm getting at. Basically, I think there's good reason to see peak oil as something provoking restructuring and change - which of course won't be easy - rather than complete collapse. The only 'preparation' that I'm taking, in this regard, is mental - in the sense of not becoming too attached to the current way of life - and pragmatic, in that I'm trying to get a job in a sector of the economy that will still be useful in the future.

What are your thoughts on this? Am I being realistic or simply naive?

Major die off.

It all depends on your level of doomerosity. It's a scale of 1 to 10, where 1 means "everything is going to be fine, technology will save us, and economists say higher prices will bring out more oil from the ground", and 10 means "billions of people are going to die, buy guns and ammo, stock up on food and water and prepare to defend yourself against the marauding hordes".

1's are also known as cornucopians (or economists), and 10's are known as the doomers. The moderates are in the middle, ranging from the 4's to the 6's. Shucks this is starting to sound like a certain rather popular sci-fi TV series which is showing at the moment

an "we" are here

I don't think it depends on your level of 'dommerosity' at all. How bad the crisis is going to be is mainly a scientific question, not an emotional one - although the latter always plays in judgements.
And stuff like this...

...really annoys me. I'm coming on here to try and find out more about these issues. Rather than shrug off my questions, which are totally reasonable ones, you could at least try to share your point of view.

I just did - Huge die off, in the Billions.

I have to agree with MonkeyDust on many of his suppositions. For instance he refers to WWII as an example of the society in general not collapsing. Actually WWI is a better example. Because of the British blockade of Germany, a horrendous harvest, and the allocation of what foodstuffs there was to the German army, the German civilians were literally on the brink of starvation. They were eating grass in many instances (if they could find it). Yet they continued to wage war. They suffered greatly. They bitched about it but nothing happened and the government did not have to post armed guards to stop rioting.

On the opposite side I also acknowledge we have had food riots in Haiti, Egypt, and other impoverished nations recently. But there has been no mass killings or starvations yet. Look at the droughts which annually plague Africa. Thousands, possibly millions die, and yet very little change occurs to their society.

And so I think the odds of massive, violent upheavals in society are remote. We just don't start killing each other in mass numbers. Genocide is a rare event. And when it does happen nine out of ten times it is tied to religious beliefs and not wanting the resources used by those killed.

Will there be change? Most definitely. Will there be scaling back on "luxury items"? Most definitely. Will our commercial and consumption patterns change? Most definitely. Will massive starvation occur in the world? Most definitely and in all probability where it already happens. Will we adapt to the new society. I believe we are already doing so.

Will our grandchildren 40 years from now wonder what the big deal was in 2005-2015 about oil? Most definitely as they start the cycle of massive consumption all over again with whatever processes come forth from technology.

So I guess I am about a 2.3047 on the 1-10 scale lowem puts forth.

And why do I think there are so many 9's and 10's today. I think it is the Internet. I believe they always were there but had no way to express themselves globally. Now they can become the wheel that is squeaking the loudest and so get the most attention.

Just my two cents worth (which only buys 0.421% of a gallon of diesel fro my F250).

Monkeydust, you might want to check out the list of categories people designate themselves: Cornucopians, Moderates or Doomers, I think you'll find it by clicking on the Member list on the left of the site. That way, at least you can decide whether to just ignore all of the doomers, or have advance knowledge of their views.

The doomers rule. Any attempt to discuss how things may not be utterly utterly terminal for all mankind and his wife, is scoffed at. These people have a deep deep emotional attachment to their point of view (i.e P.O is right now causing the die-off of the entire human race) and nothing you can say will alter their view.

I've been browsing here for three years, and the doomers are now totally crowding out sensible and flexible discussion. So, choose your forums wisely, if you want to have a discussion.

I was surprised to see your post title, since the world economy is obviously on the brink of a major recession right now, but it is not immediately caused by Peak Oil. This leaves us with the probability that this recession will even out over the next five years, with a significant lowering of prosperity all round, but eventually reaching a 'plateau' where sectors such as the 'alternative energy' industry boom into another financial bubble, while other sectors (consumerism) limp along. Maybe this will be the period of forced adjustment to a world of scarce and costly fuel, in which case it's going to look like this for a very long time.

Like you, I believe collapse is unlikely (unless you happen to live in Zimbabwe.)

an I believe we are not. Show me some "adapting" evidence that "we" can change.