Such a failure of imagination has been at the heart of the debate about climate change. The green message—use less energy—is not going to solve the problem unless economic growth stops at the same time. If it does not (and it won't), any efficiency saving will soon be eaten up by higher consumption per head. Even the hair-shirt option, then, will bring only short-term relief. And when a dire prophecy from environmentalism's jeremiad looks as if it is coming true, as the price of petroleum rises through the roof and the idea that oil might run out is no longer whispered in corners but openly discussed, there is a temptation to believe that the end of the world is, indeed, nigh.
[...]
For oil replacements, cheap suddenly looks less of a problem. The biofuels or batteries that will power cars in the alternative future should beat petrol at today's prices. Of course, today's prices are not tomorrow's. The price of oil may fall; but so will the price of biofuels, as innovation improves crops, manufacturing processes and fuels.
In the space of a couple of years, all that has changed. Oil is no longer cheap; indeed, it has never been more expensive. Moreover, there is growing concern that the supply of oil may soon peak as consumption continues to grow, known supplies run out and new reserves become harder to find.
[...]
Global warming certainly will not. “Peak oil”, if oil means the traditional sort that comes cheaply out of holes in the ground, probably will arrive soon. There is oil aplenty of other sorts (tar sands, liquefied coal and so on), so the stuff is unlikely to run out for a long time yet. But it will get more expensive to produce, putting a floor on the price that is way above today’s. And political risk will always be there—particularly for oil, which is so often associated with bad government for the simple reason that its very presence causes bad government in states that do not have strong institutions to curb their politicians.
Joined: Dec 27, 2004 Posts: 12577 Location: zombie horde wonderland
Posted: Thu Jun 19, 2008 1:53 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
gnm wrote:
Wasn't there an article by these guys a couple years back that blew off the idea and swore we had 40 years left at least before peak?
-G
"In its August 10 edition, The Economist magazine asserts that Saudi Arabia can continue producing oil at its current production levels for 70 years, without having to look for another drop. Further, the magazine claims that the nation could find "plenty more if they look", calling for privitisation of national oil companies to help increase oil production.
The language is provocative - the world has plenty of oil, and only requires sufficient investment and exploration to find it. This is a line that The Economist has held for some time, certainly since before its now infamous March 1999 issue proclaiming that we were "drowning in oil" and featuring a prediction of US$5 per barrel. That issue was followed by an embarrassing retraction in December of that year, as oil started its steady climb."
No wonder, then, that the phrase “peak oil” has been gaining ground even faster than the oil price. With each extra dollar, the conviction grows that the planet has been wrung dry and will never be able to satisfy the thirst of a busy world.
Yet the fact that not enough oil is coming out of the ground does not mean not enough of it is there. There are many other explanations for the lacklustre response to the glaring price signal. For one thing, oil producers have tied their own hands. During the 1980s and 1990s, when the price was low and so were profits, they pared back hiring and investment to a minimum. Many ancillary firms that built rigs or collected seismic data shut up shop. Now oil firms want to increase their output again, they do not have the staff or equipment they need.
Before that I think they largely played the game of "don't call it by name, maybe it will go away", but basically said geology has nothing to do with it. They're probably being dragged by the WSJ and Financial Times into acknowledging there might be something to this "peak oil" business after all.
Posted: Thu Jun 19, 2008 2:44 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
Hi, first-time poster here. I have been scouring posts in this forum to learn more about PO and its ramifications. Very sobering stuff. Here is my question for today: would someone kindly explain if there is any plausibility to the argument put forth in The Economist article. It seems much more optimistic than some of what I've been reading here. As someone keen to learn the truth, I would be most interested in reading comments about the article.
Posted: Thu Jun 19, 2008 5:04 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
harpbook wrote:
Here is my question for today: would someone kindly explain if there is any plausibility to the argument put forth in The Economist article. It seems much more optimistic than some of what I've been reading here.
The Economist argument goes "some innovation is bound to come along and fix the problem". A lot of us say "that's what they said last time". The Economist does point out the same themes were debated 35 years ago. It says in that time technologies have matured and others dropped out through competition. A lot of us look at those 35 years, most of them wasted and much ground lost (eg vehicle mileage) and wonder what makes it different this time.
So in the end it depends on outlook. Optimism vs cynicism.
Taking a balanced view, we may be starting from an improved technological base, but we are also starting from a position of greatly increased dependence. By dependence I mean not GDP voodoo but our living arrangements, system resilience to shock, personal finances and so on.
Joined: Feb 20, 2005 Posts: 2799 Location: Uppsala, Sweden
Posted: Thu Jun 19, 2008 5:42 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
harpbook wrote:
Hi, first-time poster here. I have been scouring posts in this forum to learn more about PO and its ramifications. Very sobering stuff. Here is my question for today: would someone kindly explain if there is any plausibility to the argument put forth in The Economist article. It seems much more optimistic than some of what I've been reading here. As someone keen to learn the truth, I would be most interested in reading comments about the article.
Thanks,
harpbook
The big issue with the alternative fossil fuels like tar sands and liquefied coal is that it will take a long time, decades, to ramp'em up.
And even though the reserves of unconventionals in the ground are immense, you can only produce them so fast. It's like having a million dollars in the bank but just being able to withdraw $1000 a month.
Furthermore, I'd really recomend you reading my sig line and thinking hard about it.
*Thinkthinkthink*
Ok, now that'd you'd done that and understood we have huge amounts of energy available, try to figure out how we are to run our cars on windpower and nuclear energy. Not that easy, eh?
Still, those two things will help immensely.
Ah, and yes. Google "plug-in hybrids".
_________________ Peak oil is not an energy crisis. It is a liquid fuel crisis.
Joined: Feb 20, 2005 Posts: 2799 Location: Uppsala, Sweden
Posted: Thu Jun 19, 2008 6:20 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
seldom_seen wrote:
Starvid wrote:
Peak oil is not an energy crisis. It is a liquid fuel crisis.
This is an illogical statement.
Liquid fuel is a form of energy, thus peak oil is an energy crisis.
It's like saying starvation is not a food crisis, it's a lack of meat and potatoes crisis.
Most (all?) starvation crises are not about a lack of meat and potatoes but a lack of infrastructure and political will, so I think it's still spot on.
Or to put it another way. If we could strongly increase our supply of energy but didn't manage to increase our supplies of liquid fuels, would we have solved the peak oil crisis then?
Nope. And that's just what my sig line is saying. _________________ Peak oil is not an energy crisis. It is a liquid fuel crisis.
Posted: Thu Jun 19, 2008 9:42 pm Post subject: Re: Economist Magazine: "Peak Oil Soon"
harpbook wrote:
Here is my question for today: would someone kindly explain if there is any plausibility to the argument put forth in The Economist article. It seems much more optimistic than some of what I've been reading here.
First, The Economist has been pretty consistently wrong about oil for the past decade or so. They, and others of that religion, claim that peak oil types have been consistently wrong as well, but look at the oil price and decide for yourself if prices are $38 a barrel (one Yergin - the price Cambridge Energy Resource Associates' [CERA] spokesperson - and MSM touted "expert" on oil - said oil should have fallen to in 2004-2005). If oil prices are around $38 a barrel then Yergin and The Economist have been right all along. If they are higher than that, then the peak oil predictions on price have been more reliable recently.
Second, the problem with the arguments of The Economist are that they treat oil extraction as a form of manufacturing. That's where the argument comes from that oil sands etc. are just more expensive versions of the same stuff we've been cheaply producing from wells. It's a convenient argument on their part, but the world is currently choking on just peak light crude. There's really no reason to think that we'll be able to ramp up both extraction of oil from tar sands and heavy crude refining capacity in the time we have available. Remember, Cantarell, the world's second largest oil field, is crashing at double digit percentages per year.
Finally, for The Economist to be right, we need a major advance in cellulosic ethanol technology, lots of land to grow ethanol crops (taking away land from food production which will raise food prices), significant advances in batteries and solar cells, tremendous amounts of money to completely replace our transportation infrastructure, tremendous amounts of money to upgrade our electrical distribution grids, tremendous amounts of money to modify our housing infrastructure, and the will to make the changes. It is certainly possible that all of that will happen. However, other analysts, like Matt Simmons, Colin Campbell, Robert Hirsch, T. Boone Pickens, Fatih Birol, Kenneth Deffeyes, William Ruddiman, etc. think we are more likely to have a significant problem. By the way, those are the same folks who have done a better job of predicting where this has headed than The Economist.
Posted: Fri Jun 20, 2008 12:08 am Post subject: Re: Economist Magazine: "Peak Oil Soon"
There are massive opportunities for conservation available: as prices go up these will be adopted. For example here is something which will cut in half the amount of gasoline you need to pay for to go to work. It can be implemented tomorrow. No capital expense.
Posted: Fri Jun 20, 2008 2:48 am Post subject: Re: Economist Magazine: "Peak Oil Soon"
I dunno I am the site's outlyer to be sure, but I have no problem reading The Economist and reconciling it with what I read elsewhere including here at Peak Oil. I have read many predictions made here by various posters that have not come true either.
Read Everything. Listen to Everyone. Then Decide. If the facts change. Change with them.
Even if you believe in the geological reality of finite oil - and I do - you cannot deny the role that resource nationalization has had on the exploration, drilling, extraction, transportation, refining and distribution has had on conventional and non-conventional oil and the price and availability of refined products. The price of which also reflects US dollar devaluation as well as price increases in one number, plus a failure in the past to invest in infrastructure, while prices were low.
Did The Economist know, for example, that prices would double in the past year, but that three-fifths of that price increase would be offset by national governments shielding their consumers from those price rises with subsidies that might, just might have caused some demand destruction and therefore lower pump prices today? They might have suspected as much, but I suspect as journalists they write around deadlines on a wide range of topics, and if they were dedicated oil analysts they would likely be working at a hedge fund and earning a lot more money.
It is very much the fashion de jour to pretend that peak oil is some great big secret shared by a small fraternity of those that know better, but as the number of articles over the past year or so clearly show this information is out in the wider media. We link to those stories daily here on Peak Oil. What is lacking perhaps in those stories is an indepth appreciation of the economic, social and political implications of post peak oil resource depletion. As far as I am concerned that is our role. To give that realization depth, so when someone shows up here looking for answers they get a clear and unbiased assessment of the implications of post peak oil decline.
Climate change and resource depletion as well as soaring food, fuel and fertilizer prices are daily fodder in the news these days. What do we add to that dialogue? What can we do better to sell our message to a wider audience? Or are we just here to be smug about how clever we are? _________________ The organized state is a wonderful invention whereby everyone can live at someone else's expense.
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