[Subjectivist]

I remember a ton of arguments on here in the past about how every gallon or so of demand destruction was a job lost. Not sure what the ratio actually is but the USA lost 2 million bbl/d of oil consumption and 30 million jobs, or something like that range of numbers.

[SamInNebraska]

The good news is that most folks here and at TOD have abandoned that simplistic metric for the most part and are picking away at all the various components of the POD.

Maybe. Or maybe they are picking away at the components of bad political decisions, lack of energy policy on the part of most countries (including the US), financial hooliganism which treats oil as nothing more than another commodity upon which ti inflict bankster idiocy, and all the other things people can blame on oil without it really being oil's fault.

I would save social commentary related to oil as the worst, no basis in the technical aspects at all, sheer speculation and dreams of how wonderful the world would look were it not for oil...but just wait! Soon it will be gone and we'll have eco-nirvana because we got this great peak oil thing which will allow <fill in your favorite future> to happen and the world will be saved! Or something like that.

But the other 99.99% of the population hasn't.

That amount of the population no more understands or cares about how their electricity works either, they want to flip the switch and a light to appear. Consumers want to fill up their tanks. They don't care how it gets to the underground tanks at the convenience store, only that it does.

And I think you overestimated the value of TOD and underestimated the amount of population which know anything about oil. One of the most severe faults of TOD was not considering the unseen and unknown, fitting time series data without the back ground work in resource estimates and discovery process modeling to show the potential for peak oil not being in 2008 as they once proclaimed. They despise the way the IEA and EIA do their work but it is based in just such bottoms up principles and to ignore it is to guarantee that your answer will be low.

The only exception I would make to that statement would be the work of Laherrere, his consideration of multiple cycles of production would on the surface appear to have a reasonable consideration for the unseen and unknown, but his perspective appears to be extremely limited and he does not take into account even the already known resource base.

And given the MSM hype about the "death of PO" I doubt we have much chance to change the national conversation. Eventually crisis will get folks focused properly on the situation. But probably won't make much of a difference then.

MSM has been proclaiming, alternately, peak oil as possible doom and oil-nirvana since at least the 70's. I don't expect them to change ever, and why should they if their goal is to generate boogeymen about which to write horror stories, or, console the people to the techno-happiness which lies just around the corner when the next burst of oil production shows up from another shale or tight formation? Both are a crock.

[SamInNebraska]

So what is a definition of PO?

Now THAT is the question. Once upon a time it was simple. And then...

...cornucopians and ShortOnSense needed new definitions of oil to fudge the issue.

Then go off topic with them.

[SamInNebraska]

Excellent. And as the world postpones it time and time again, and the price drives people to manufacture their products out of other items, the oil component of it becomes less and less relevant. And this is good I believe.

Well, at least you're now agreeing with me. With that, the next thing you will have to deal with is meeting increasing demand.

<snip everything under the son which has nothing to do with the topic at hand>

Fortunately America becoming Saudi America doesn't have anything to do with the stuff I snipped, or meeting increasing demand because if demand (i.e. call it consumption for now) no one in the States would be able to run down to their corner gasoline dispensary and get some. There would be some form of ration card or shortage to deal with, should they desire to start a bonfire with a tanker truck of fuel.

That not being the case, there is no case for demand not being met, i.e. consumed, for anyone who can show up with what the market requires in terms of price.

America producing oil into a global market can produce all it likes, and the price will be set by the supply/demand/price relationship for the world, not just the local improvements Americans have made to their consumptive habits for years now.

[SamInNebraska]

So PO is about production- not the amount underground. I can understand this, as flow is important. But it also occurs to me that if people move to mass transit or EV's, or for other reasons oil demand falls then the PO year really no longer becomes important at all- in fact PO itself loses any relevance in a demand destruction world.

That depends on which is falling faster, natural oil fields declines or demand. If one falls faster than the other you can still have, alternately, an increasing price environment as oil production falls faster than demand does, or more and more surplus capacity becomes available as demand falls faster than natural decline, leading to competition among suppliers driving down price. POD would seem to explain this dynamic better than just a straight production rate debate.

PO seems to be an idea locked into "oil". How do we talk about all the various forms of energy that are growing in size?

Very carefully. Peak oil is no where in the same league as peak energy, a confusion some seem to encourage either because they aren't conversant with the difference, or because they don't understand how much energy we use which we DON'T get from oil.

An economist would probably try and argue that we simply convert everything to margin cost per BTU or some specific use for a BTU and go from there, that would make sense to an economist but not a peak centric crowd.

I guess what I am asking is this: is the idea of PO becoming obsolete due to its narrowness? What words or phrases do we come up with to quickly describe the new energy production, depletion, distribution, etc. issues? Will even using the word "PO" mean anything in 20 years if other energy sources take the center stage? What are the words of the future? Any catchy name for the energy issues facing the world in 2050 if oil is only 20% or less of the mix?

Resource scarcity works for me in a general sense. A supply side economist would probably use the same terminology. Peak oil is but an old game played on a much smaller scale to the average resource economist, they think about not just oil (oil being a big part of really only one sector of the economy) but coal depletion and what happens when the marginal cost per kWh of PV beats out wind and where capital must go to do what for whom and if we run out of natural gas will it make more sense to use coal again under a certain set of government policies and so on and so forth.

It can be both interesting and bizarre.

[ralfy]

Fortunately America becoming Saudi America doesn't have anything to do with the stuff I snipped, or meeting increasing demand because if demand (i.e. call it consumption for now) no one in the States would be able to run down to their corner gasoline dispensary and get some. There would be some form of ration card or shortage to deal with, should they desire to start a bonfire with a tanker truck of fuel.

You mean "unfortunately," as demand doesn't simply mean "[running] down to their corner gasoline dispensary and get some." If only the issue were as simple as that.

That not being the case, there is no case for demand not being met, i.e. consumed, for anyone who can show up with what the market requires in terms of price.

Actually, it's been the other way round:

http://www.economist.com/blogs/dailycha ... onsumption

America producing oil into a global market can produce all it likes, and the price will be set by the supply/demand/price relationship for the world, not just the local improvements Americans have made to their consumptive habits for years now.

No, it can't "produce all it likes," and your latter point supports my arguments.

[Pops]

That not being the case, there is no case for demand not being met, i.e. consumed, for anyone who can show up with what the market requires in terms of price.

So is that your new argument, there is no supply problem because anyone who can afford the price can buy all they want?

lol, let them eat on cake

[ROCKMAN]

Sam – “And I think you overestimated the value of TOD and underestimated the amount of population which know anything about oil”. I don’t think so. I don’t mean to hurt the feelings of the fine folks running this site but IMHO there’s little value to TOD and sites like this. A great place for folks like us to share thoughts but can you point to one concrete impact of PO.com or TOD on the country?

As far as my appreciation of the public knowledge base I’ve worked in the OIL CAPITAL of the world for over 30 years…Houston. We have more members in the local geologic society then all the other associations in the world COMBINED. And I can assure you that only a very tiny minority understand the current energy situation. In fact, you would probably be shocked to discover how few folks in the oil patch here have a good grasp of the big picture. The majority of reservoir engineers I know never heard of Hubbert and don’t know the term “PO”. Consider one fact: in a major city that houses more oil patch corporations than all the other cities on the planet there is no “Oil & Gas” section in the one big local newspaper. Not daily, weekly or even monthly. And maybe sometimes in the Sunday paper they’ll run a story or two related to the energy industry but typically something they just pulled off the wire service.
You might guess that I’m a rather chatty fellow. I visit with lots of folks from all around the country on a regular basis. At this point I’m never surprised at the complete lack of understanding about energy I discover. I would like to see folks here do a quick survey: in your daily travels drop the term “peak oil”, without explaining it and tell us what percentage appear to have even heard the term. We live in a very rarefied world at sites like this and TOD. We are not “normal”…we are not “the people”. LOL

As far as what gets posted on TOD there is no "TOD" that does or doesn't do anything. What gets posted here and there is subject to what the participants post. You're free to post about anything on your list of "what doesn't get posted" matters. I, for one, would be interested in seeing your analysis. You appear to be very well up on the subject.

[SamInNebraska]

That not being the case, there is no case for demand not being met, i.e. consumed, for anyone who can show up with what the market requires in terms of price.

So is that your new argument, there is no supply problem because anyone who can afford the price can buy all they want?

lol, let them eat on cake

No, I was responding to Ralfy's point that somehow BAU can only continue with increasing demand. Obviously between about 1979 and 1992 there could be no happiness, no increase in GDP because there was no increase in demand (i.e. consumption). Obviously this is a rhetorical statement because GDP did go up, and the relationship between increasing demand and continued economic activity was different. Ralfy's "it always has to do this" scheme just doesn't hold up to any scrutiny across time.

As far as supply and demand today, demand is not defined by economists as an equivalent to consumption (even though I do it that way), because demand to an economist is someone sitting in a boat in the middle of the Atlantic, "demanding" fresh water. An economist then applies a relationship between this nefarious "demand" for something and quantity, the place where they intersect called price. In this example, there is no price available to meet demand because there is no supply.

Because Ralfy never supplies actual cost/supply relationships in his voluminous references to others who also don't provide cost/supply relationships, there is no way to know what him, or they, actually mean in the traditional view of economic theory.

The ability of someone to pay the local price to get any quantity they wish of gasoline or whatever means that demand is being met...at a given price. None of this is an argument, any freshman econ text would start with these basics.

[SamInNebraska]

Fortunately America becoming Saudi America doesn't have anything to do with the stuff I snipped, or meeting increasing demand because if demand (i.e. call it consumption for now) no one in the States would be able to run down to their corner gasoline dispensary and get some. There would be some form of ration card or shortage to deal with, should they desire to start a bonfire with a tanker truck of fuel.

You mean "unfortunately," as demand doesn't simply mean "[running] down to their corner gasoline dispensary and get some." If only the issue were as simple as that.

I recognize that your desire to see it be as complex as possible helps hide the underpinnings of a bad claim, but none of this has to be complex.

All you need to start with is a cost/supply curve provided by one of your sources showing what a given amount of resource will cost with a given amount of development. Find one of those, and we can start there. All the rest of this is just smoke screen.

Once you have the cost/supply curve (an inherent input into probably any economic model ever constructed including those used in the bottom up approaches of the IEA and EIA) we can discuss where you think it is inaccurate, or reasonable, or whatever.

We can discuss current global demand, and how that can be met with this supply, and what the marginal cost of production is. This is a critical point because of where those marginal barrels are coming from, currently US tight oil and Canadian tar sands. Once those resources are exhausted, or more supply is needed, we can use that global cost/supply curve I referred to earlier to guess at what the next stable marginal price will be.

All the rest of it, who needs this for how much, who has credit, who doesn't, where does the capital investment come from, where does this oil sit and who controls it, and how, all is secondary to the basics. Figure out that cost/supply curve, and the particulars of it, and you can then build your own model on how this all cascades through time. Do it right and there is a well paying job for you in NY writing white papers on it that others can study and learn from.

[Oily Stuff]

I too live and work in the oilfield every day and engage service people, salespeople, supervisors, landmen, geologists, engineers and attorneys, from brilliant to dumb as a 4 pound hammer, and it astounds me how deeply, deeply in denial most people in my industry are about the energy future of our world. I think on an very abstract basis most people that work in the oil and gas industry feel they are making a contribution to society by finding and getting the nasty stuff out of the ground and into SUV's... and are proud of that. They get the big head, get caught up in all the big iron, the big dollars, the big frac jobs that are so loud they make your teeth hurt, and they simply cannot accept that as long as we can drill wells... life going forward will be peachy. Below the highest corporate level, employees fall prey to the propaganda, see the 800 BOPD IP's and hear all about the 40,000 shale wells to be drilled for instance, and they think of job security for themselves and their families. They don't want anyone threatening that with factual data. I have tried to explain the economics of tight oil wells to roughnecks, frac supervisors, SIPES members, whatever; they simply won't have it. As long as we are turning to the right, things will be alright and it seems to me the older you are, and still in the industry, even folks that have lived thru many booms and busts, the less likely they are to embrace peak oil (production) idealism. I often feel like an outcast among my peers because of my idealism about our energy future.

So again, as I have said before (and been told I was talking nonsense by some meathead), anybody IN the oil business that goes against the abundance flow I think does so thru experience. He/she is seeing something in the production numbers, the economics, reservoir performance, infrastructure failures, costs, regulatory constraints, decline curves; something very real is causing that person to feel different than the rest, to be concerned. Think of that person as a potential...whistleblower.

I agree too that for the most part we talk among ourselves on forums like this and TOD; we preach to each other. It's a time filler for most people. It is important to get off the beaten path whenever we can and take the peak production message to the streets. Where it would do the most good.

[furrybill]

OS,

Your statements here remind me of the couple years I was working for Philip Morris. The level of denial in the average worker was beyond belief! No one would admit that cigarettes are addictive or can cause cancer. No one would admit to the nasty tactics used by the company to expand and maintain its base of addicted users [I met a guy once who's job was to open markets in Eastern Europe, you wouldn't believe his stories]. Even worse, everyone truly believed that the company made loads of money because it was efficiently run and produced an awesome product rather than admitting that it was selling a super-marked-up product to people who were willing to pay through the nose for their "fix".

Or how about the people I've worked with in the banking industry who truly believe that their company is a force for good in the world?

This kind of denial is rampant in corporate America and elsewhere. People HAVE to lie to themselves because its how they feed their families. You're 100% correct OS, only the most thoughtful and self-honest people in the energy industry are going to figure out and talk about the true status of peak oil.

[SamInNebraska]

One of the oft repeated statements poo-pooing PO is "the stoneage didn't end for lack of stones." The problem is we aren't transitioning away from FFs for something better, as for example switching from stones to iron. If we had something better we would be doing it instead of trying to shoehorn our non-negotiable FF based lifestyle into a "renewable" slipper. But we aren't, because there isn't a better alternative, we are switching because we are running out of stones and that's the difference.

When the IEA claims we have used perhaps 1/7 of the fossil fuels available just for making liquid fuels, "running out" is not part of the story. More expensive might be, and would be completely expected, but that isn't running out. As far as what alternatives are "better", certainly the US going from 2 to 60 Gw of installed wind power (would anyone care to calculate the exponential rate for more than 4 doublings in 13 years?) shows that the fascination with only fossil fuel generated power production isn't just waning, it is dropping dead out of sheer obsolesce. Once upon a time we used leaded fuels, and they went bye-bye. Once upon a time 10mpg was okay in Grandpa's Caddy, nowadays 500HP Corvettes are almost hitting 30mpg. Once upon a time the US didn't insulate, didn't put PVs on rooftops, didn't have EVs, or diesels, or Energy Ratings on appliances. Today's world isn't that of yesterday, and yesterday certainly won't be that of today. Good riddance to fossil fuels, the sooner they are eradicated like a disease the better, and if they die naturally with less than 2/7's used up, so much better that the other 5/7 stay in the ground.

[Pops]

Come on, how hard is it to understand that resources aren't reserves and cheap is the key to the problem. If money were no object, we'd all be wearing shiny underwear woven from ocean recovered gold.

But rate of production and cost is a limit, if it weren't, OECD consumption would not be falling.

Wind only produces 3.5% of US electricity generation and relies on state and federal subsidies for up to 30% of cost – and unfortunately your exponential curve is capped by austerity...

Wind turbine installations will probably drop to 2,800 megawatts from a record 13,000 megawatts installed before the tax credit expired last year, according to New Energy Finance.

http://www.bloomberg.com/news/2013-04-1 ... jects.html
http://www.forbes.com/sites/christopher ... ind-power/

But what is interesting is on the one hand you say we have FFs galore so why would we need alts then turn around and say wind is going to grow exponentially and replce FFs. I can understand people who say one or the other but I can't figure out people who say both as if it somehow puts the double-VooDoo-Hex on the idea of finite fossil fuels.

Promoting the hype of KSAmerica - particularly by citing kerogen and bitumen as a replacement for oil is the very thing that is limiting alt deployment via subsidies.

[C8]

Yeah, if the modern world didn't rely on fossil fuels for just about everything and if an easy replacement were handy, there wouldn't be a problem. lol

One of the oft repeated statements poo-pooing PO is "the stoneage didn't end for lack of stones." The problem is we aren't transitioning away from FFs for something better, as for example switching from stones to iron. If we had something better we would be doing it instead of trying to shoehorn our non-negotiable FF based lifestyle into a "renewable" slipper. But we aren't, because there isn't a better alternative, we are switching because we are running out of stones and that's the difference.

Most of the discussion here the last 9 year has been about transitioning away from FFs. The reason the date is important is if decline begins soon we won't have time to transition easily as a society. Everything runs on FFs and the strings are connected everywhere.

.

Pops- I am going to guess that you don't believe that FF's will be replaced very well, the price will skyrocket, and PO will have society in a headlock- am I correct?


The way I see it, there are two more likely outcomes:

1. New oil is constantly discovered- the price stays low- no PO
2. oil production slips, prices rise higher than the many other energy sources coming online- they take over- oil percentage of the energy mix declines so rising prices don't have as much of an impact- no PO

to me, this whole plateau thing is creating the time and desire to fully develop alts (BTW- I include natural gas in those alts as many vehicles are switching over). 5 years ago PO was mainly based on the hard quick landing scenario- that is becoming less and less likely. if nothing else- our energy sources seem to be expanding since then (methane ice, thorium, etc.) we may have over 50 ways to get energy in the nest 10 years

I cannot see anything but checkmate and eventual obsolescence for PO as it is linked to oil only. I think a broader concept is necessary (maybe energy scarcity- ES or Peak Energy PE)

[kublikhan]

I agree too that for the most part we talk among ourselves on forums like this and TOD; we preach to each other. It's a time filler for most people. It is important to get off the beaten path whenever we can and take the peak production message to the streets. Where it would do the most good.

Your comment reminded me of the time a journalist was hitting up all of the major peakoil websites for background on an article he was writing. I was curious how the article turned out so I tried to find it. I couldn't find the article, but based on some comments of the author in another article I am not sure I want to anymore!

The SION event reminded me, more than anything else, of a Peak Oil meeting I attended last year. Both hotel conference rooms were full of people who believed that they were the only ones who could see apocalypse just over the horizon; at both, attendees lamented the blindness of the media and munched snacks while discussing the end of civilization.

Of course, Peak Oil does not have human enemies, and counter-jihadists do. One can debate their designation as a hate group (they don’t preach violence), but the harsh language is impossible to miss; the harsh language often seems to be the point.

Counter-Jihad Takes to the “Information Battle-space”

Ouch. Poers are devotees of a hate group enthralled with the coming apocalypse? I thought we were here to discuss oil depletion? :/

[kublikhan]

I cannot see anything but checkmate and eventual obsolescence for PO as it is linked to oil only. I think a broader concept is necessary (maybe energy scarcity- ES or Peak Energy PE)

"Resource depletion" might be a better term as it encompasses more than just energy but also depletion of rare earths and mineral ores, scarcity of fresh water, topsoil depletion, peak phosphorus, etc.

The way I see it, there are two more likely outcomes:

1. New oil is constantly discovered- the price stays low- no PO
2. oil production slips, prices rise higher than the many other energy sources coming online- they take over- oil percentage of the energy mix declines so rising prices don't have as much of an impact- no PO

Have you seen Hubbert's 1976 interview? There is a graph at the end of the clip where he shows human fossil fuel use through recorded history.

It's the most disturbing thing that's ever happened to the human species. It's responsible for our technological society. And in terms of human history, it's a very brief epoch.

Our modern society was built on the foundation of fossil fuels. Today, they provide over 4/5ths of our energy. Hubbert called them "The most disturbing thing that has ever happened to the human species". To expect a smooth transition to alternatives in response to resource depletion with "not much of an impact" seems like wishful thinking to me.

[Oily Stuff]

What kind of mileage can I expect to get pulling a horse trailer on depolymerized turkey guts??!!

I suspect there are some emissions problems with that, but I like it! Drumsticks and fuel; one stop shopping. Cool.

[ROCKMAN]

OS –“I have tried to explain the economics of tight oil wells to roughnecks, frac supervisors, SIPES members, whatever; they simply won't have it.” And thus why I no longer try to teach pigs to roller skate. Just shut up and get a cold one when you come of tower. LOL

Bill – “You're 100% correct OS, only the most thoughtful and self-honest people in the energy industry are going to figure out and talk about the true status of peak oil.” And only then anonymously on sites like this and TOD. We may be thoughtful and honest but we ain’t stupid. LOL. I made that mistake decades ago when I told one of my VP's I voted for Jimmy Carter.