Donate Bitcoin

Donate Paypal


PeakOil is You

PeakOil is You

The Domino Effect; Post Peak-Oil

General discussions of the systemic, societal and civilisational effects of depletion.

The Domino Effect; Post Peak-Oil

Unread postby MonteQuest » Fri 24 Sep 2004, 23:01:35

In a post-peak world, we know things are going to change and change dramatically. But, how fast will the onset of peak-oil be? Who, and what will be affected first. As you all know, I see the airlines as the “canary in the mineshaft.” This will start a domino affect reaching out to the parcel carriers, aerospace industries, tourism, travel agencies, hotels, motels, restaurants, cruise ships, theme parks and many other forms of recreation. Fewer tourists mean fewer dollars and fewer dollars means loss of jobs in places where the tourist dollar is the primary source of income. Delivering mail, transporting raw materials to manufacturers and sending products bought over the Internet are just some of the everyday transactions that will take more time and money as carriers downsize and put fewer planes in the sky.

Leisure oil use activities will surely be hurt, especially the recreational vehicle industry. The demand for motorhomes, jet-skis, off-road vehicles, pleasure boats, snowmobiles, ATV’s, (motorcycles may be a growth industry, though) private airplanes, and the biggest industry of all—racing—will drop dramatically as shortages occur and fuel costs rise. Think of all the industries that racing and recreational vehicles supports: helmets, insurance, auto parts/repairs, etc, etc. Bottom line; a lot of people’s jobs are going to disappear almost overnight. It won’t be just about paying more for gas and using less as a lot of people think. Post-peak oil prices will start a pandemic that will spread throughout our economy like a wildfire fanned by a strong wind.

What will governments do? Will oil go to the highest bidder? Will we see countries like China, Japan, and the US competing for oil to meet their growing economies? Or will we see the US taking the oil by military force? Will there be hoarding? Will conflict we create exacerbate the crisis that peak-oil will cause? These are all questions with few answers.
Last edited by MonteQuest on Sat 27 Jan 2007, 15:04:21, edited 1 time in total.
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
User avatar
MonteQuest
Expert
Expert
 
Posts: 16291
Joined: Mon 06 Sep 2004, 02:00:00
Location: Westboro, MO

Unread postby Jack » Fri 24 Sep 2004, 23:16:49

I really think the onset will be slow. We'll see prices rise dramatically, which will curtail demand and cause a recession. That will curb demand and slow the price increase for a time.

I agree that airlines will be in trouble; and leisure time activities as well. The tourist industry is likely to suffer.

But with regard to global geopolitics, I strongly suspect that oil will go to the highest bidder. The problem with taking oil by force is that protecting the needed infrastructure is a big problem. An even worse problem is that a nuclear China might have a strong objection!

I think there will be a little hoarding, but the public pressure to use the reserves will be too great. Frankly, it is madness to pump oil out of the U.S. strategic reserve at this time - but we appear to be doing it.

Really, I think that the initial stages will be a case of the rich nations facing higher expenses, and the poor ones being crowded out. Later, things may become more challenging.
Jack
Fusion
Fusion
 
Posts: 4929
Joined: Wed 11 Aug 2004, 02:00:00

Unread postby Colorado-Valley » Sat 25 Sep 2004, 01:16:53

Trucking companies will be hurt very badly -- even with diesel at only $2.14 a gallon where I live -- for independent truckers this is a killer.

Also construction companies. A coffee-shop friend who owns a small construction company is already in trouble. Earlier this year before fuel went up he successfully bid on a bridge project 90 miles away. Commuting to the project and running his machinery is going to make him lose big money. He may even go bankrupt.

Don't forget discount stores like Wal-Mart. They have high transportation costs (goods cargoed all the way from China!) and their working-class clientele doesn't have a lot of discretionary income to buy frivolous stuff when it's all going to fill gas tanks.

And, like Jim Kunstler likes to say, when peak oil hits, we won't be eating any more 1,300-mile Caesar salads. I think we should be promoting local farming around our cities and towns right now. Farmers' markets are a great way to buy your food.
User avatar
Colorado-Valley
Intermediate Crude
Intermediate Crude
 
Posts: 729
Joined: Mon 16 Aug 2004, 02:00:00

Unread postby wzx » Sat 25 Sep 2004, 05:09:28

Lets say, the US Dollar crashes when Arabs refuse to invest in the USA or the Chinese in a suicide mood decide to take down the USA by refusing anymore loans, how will American be able to purchase oil then? With what currency/commodities ? Maybe peak would then be dealyed a couple of years when the greatest consumer does not have the ability to purchase as much ?
User avatar
wzx
Coal
Coal
 
Posts: 32
Joined: Sun 23 May 2004, 02:00:00
Location: singapore

Unread postby HUT » Sat 25 Sep 2004, 06:14:45

Hi all! This is my first post to peakoil. I have been following global oil and energy politics for some time now. Personally I can see only one way out from the present situation. Massive increase in energy efficiency. For Americans that would mean at least dropping SUV's, converting to diesel in a larger scale and developing mass transport. I think European car market is showing what will or what should happen particularly in the US. At the moment the consumption of diesel fuel is growing most rapidly in Europe. Diesel engines should be favoured all along the line anyway because they can use a variety of fuels (natural gas, natural oils etc). Having said all this, Europe and and US still consume massive amounts of energy and oil per capita compared to just about anybody else in the world. There is still a lot to do.
User avatar
HUT
Coal
Coal
 
Posts: 2
Joined: Sat 25 Sep 2004, 02:00:00
Location: Finland

Unread postby airstrip1 » Sat 25 Sep 2004, 06:21:28

Jack wrote:
But with regard to global geopolitics, I strongly suspect that oil will go to the highest bidder. The problem with taking oil by force is that protecting the needed infrastructure is a big problem. An even worse problem is that a nuclear China might have a strong objection!



I wish I shared your confidence. Unfortunately, history tends to show that nations will wage wars over scarce resources even if it means risking destroying the prize that is being fought over. Just check out how often the word oil crops up in the standard Encarta entry on World War II

http://uk.encarta.msn.com/text_76156373 ... ar_II.html
User avatar
airstrip1
Heavy Crude
Heavy Crude
 
Posts: 298
Joined: Sun 15 Aug 2004, 02:00:00

Unread postby MonteQuest » Sat 25 Sep 2004, 09:15:53

airstrip1 wrote:
Jack wrote:
But with regard to global geopolitics, I strongly suspect that oil will go to the highest bidder. The problem with taking oil by force is that protecting the needed infrastructure is a big problem. An even worse problem is that a nuclear China might have a strong objection!



I wish I shared your confidence. Unfortunately, history tends to show that nations will wage wars over scarce resources even if it means risking destroying the prize that is being fought over. Just check out how often the word oil crops up in the standard Encarta entry on World War II

http://uk.encarta.msn.com/text_76156373 ... ar_II.html


I agree. Here's an excerpt from my book:

After Hitler invaded the U.S.S.R. in late June 1941, and Japan occupied the rest of Indochina, FDR froze all Japanese assets, thus cutting off trade, including oil. Without oil, Japan could not long continue the war against China; without oil, the Japanese Empire would wither and die. Japan made numerous efforts to negotiate using diplomatic measures to avoid war, but the U.S. rejected their offers. Six days before he cut the oil lifeline, he was warned in a memo from the navy chief of war plans that “doing so would lead promptly to Japanese action against the Philippines, which would involve us in a Pacific War.”

America demanded that Japan relinquish all conquests since 1937, withdraw all her troops from both China and Indochina—and in effect abrogate her Tripartite Treaty with Germany and Italy—as the price of lifting the embargo. To Tokyo, this was an ultimatum.
Thus the day of reckoning came for the Empire of the Sun; diplomatic surrender and humiliating retreat from China, and the end of their reign as a great power—or a desperate lunge south to seize the vital resources for which Japan was starving. But first, they had to neutralize the one force that could prevent them from doing so: the U.S. battle fleet riding at anchor at Pearl Harbor. During the two-hour raid, Japanese warplanes sunk or seriously damaged 16 major U.S. naval vessels, including six battleships, and killed 2,400 American servicemen.

On December 8, 1941, FDR went before Congress to decry “a date which will live in infamy.” The same day, former president Hoover wrote to his friends, “You and I know that this continuous putting pins in rattlesnakes finally got this country bitten.”
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
User avatar
MonteQuest
Expert
Expert
 
Posts: 16291
Joined: Mon 06 Sep 2004, 02:00:00
Location: Westboro, MO

Unread postby Licho » Sat 25 Sep 2004, 10:10:31

Colorado-Valley wrote:Trucking companies will be hurt very badly -- even with diesel at only $2.14 a gallon where I live -- for independent truckers this is a killer.


Well, even post-peak, you still need to transport large ammounts of cargo, and trucking is the only way in most parts of the world. So this industry won't be affected, they will just raise prices. There are no other alternatives .. railroad is not so well developed to transport all cargo, so trucking will be the way to go for long time, and won't be hurt by high prices.
User avatar
Licho
Intermediate Crude
Intermediate Crude
 
Posts: 833
Joined: Mon 31 May 2004, 02:00:00
Location: Brno, Czech rep., EU

Unread postby TripleGemini » Sat 25 Sep 2004, 12:10:15

wzx wrote:Lets say, the US Dollar crashes when Arabs refuse to invest in the USA or the Chinese in a suicide mood decide to take down the USA by refusing anymore loans, how will American be able to purchase oil then? With what currency/commodities ? Maybe peak would then be dealyed a couple of years when the greatest consumer does not have the ability to purchase as much ?


wxz, that's an interesting thought. Here I am worried about Bush and the neocon's escalating with more resourse wars. But I had not though of it in economic terms (small brain here :oops: ).

Am I understanding this right? The other big players could effectively shut down our economy w/o firing a shot. With the US out of the way, other countries could begin to switch important infrastructure to renewables and start a powerdown?? I understand that if the US dollar tanks, it will cause a world wide depression, yes. However, it the other big players know that PO is knocking at their door and a world wide depression is inevidable , would it not be prudent to get the US out of the picture, both monetarily and (as a result) militarily?

Effectively, they could hand the US a "go to jail, go directly to jail and do not get out of jail" card and then begin to get their houses in order?

For those smart brains in here, is that right?

Trip
User avatar
TripleGemini
Coal
Coal
 
Posts: 67
Joined: Fri 09 Jul 2004, 02:00:00
Location: Sunny San Diego

Unread postby MonteQuest » Sat 25 Sep 2004, 12:16:36

Am I understanding this right? The other big players could effectively shut down our economy w/o firing a shot. With the US out of the way, other countries could begin to switch important infrastructure to renewables and start a powerdown?? I understand that if the US dollar tanks, it will cause a world wide depression, yes. However, it the other big players know that PO is knocking at their door and a world wide depression is inevidable , would it not be prudent to get the US out of the picture, both monetarily and (as a result) militarily?

Effectively, they could hand the US a "go to jail, go directly to jail and do not get out of jail" card and then begin to get their houses in order?

For those smart brains in here, is that right?


In this day and age with globalization, no one big power can go down without the rest following. We in the US are the most complex society, thus the most vulnerable. We would suffer more faster than they, but then again Japan gets 99% of their oil from imports.
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
User avatar
MonteQuest
Expert
Expert
 
Posts: 16291
Joined: Mon 06 Sep 2004, 02:00:00
Location: Westboro, MO

Unread postby MonteQuest » Sat 25 Sep 2004, 12:18:15

PS...And the most debt-ridden. Our balloon is huge! When it pops, there will be a big bang!
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
User avatar
MonteQuest
Expert
Expert
 
Posts: 16291
Joined: Mon 06 Sep 2004, 02:00:00
Location: Westboro, MO

Unread postby TripleGemini » Sat 25 Sep 2004, 12:51:35

Yes, and the bubble just got bigger. It's almost like Bush and the gang are pushing this thing along... but I digress!

Back to the other big players handing the US a "go to jail" card. From reading your posts Monti (which I appreciate greatly btw), I understand that when the bubble pops it will pop for everyone. That beings said however, that if they pop the bubble on purpose, while the US is suffering from a complete collapse in every sense of the word , would they not be able to better "structure" their collapse? The survival of the fittest?

Trip
User avatar
TripleGemini
Coal
Coal
 
Posts: 67
Joined: Fri 09 Jul 2004, 02:00:00
Location: Sunny San Diego

Unread postby MonteQuest » Sat 25 Sep 2004, 13:09:25

TripleGemini wrote:Yes, and the bubble just got bigger. It's almost like Bush and the gang are pushing this thing along... but I digress!

Back to the other big players handing the US a "go to jail" card. From reading your posts Monti (which I appreciate greatly btw), I understand that when the bubble pops it will pop for everyone. That beings said however, that if they pop the bubble on purpose, while the US is suffering from a complete collapse in every sense of the word , would they not be able to better "structure" their collapse? The survival of the fittest?

Trip


"Survival of the fittest" in terms of ecology, means that those organisms who can readily adapt and reproduce, have the greatest change for survival. In nature, that occurs as the result of random genetic mutations that allow the species to weather the storm, so to speak. For example: some people will never die from AIDS because they will have a genetic mutation that prevents the disease from attacking their immune system.

Man, on the other hand, has the ability to reason this out to some degree when it comes to his choices. Will China be able to more readily adapt if they pop the bubble, having done all they could to minimize the effects on themselves? Maybe. IMO, no. But they don't have the debt we have, but they do have 1.3 billion people gulping oil like we did in the sixties.
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
User avatar
MonteQuest
Expert
Expert
 
Posts: 16291
Joined: Mon 06 Sep 2004, 02:00:00
Location: Westboro, MO

Unread postby Jack » Sat 25 Sep 2004, 16:44:10

airstrip1 wrote:
Jack wrote:
But with regard to global geopolitics, I strongly suspect that oil will go to the highest bidder. The problem with taking oil by force is that protecting the needed infrastructure is a big problem. An even worse problem is that a nuclear China might have a strong objection!



I wish I shared your confidence. Unfortunately, history tends to show that nations will wage wars over scarce resources even if it means risking destroying the prize that is being fought over. Just check out how often the word oil crops up in the standard Encarta entry on World War II

http://uk.encarta.msn.com/text_76156373 ... ar_II.html



You've got a good point. If you were to say that China would go to war to secure an oil supply, I'd agree. But the current U.S. performance in Iraq makes me wonder...would the U.S. public long tolerate a stream of dead and wounded?

Recall that during Gulf War I, Bush the Elder started off saying it was about jobs - but that didn't really fire the imagination. Other stories were required.

We can also expect that we'd need a broad-based military draft. And we would have to deal aggressively with insurgents - something we seem completely unwilling to do presently.

Maybe the economic and thermodynamic realities will change U.S. attitudes; but I'll be more than a little surprised if we go into any more wars in the next decade. Unless, of course, there's a very clear attack by another country against the U.S....but that seems unlikely.
Jack
Fusion
Fusion
 
Posts: 4929
Joined: Wed 11 Aug 2004, 02:00:00

The Snowball Effect

Unread postby babystrangeloop » Sun 16 Oct 2011, 07:51:46

Yemen goes into war which results in costly attacks against the energy infrastructure there. Not only do such attacks require costly repairs but they also suspend the production of export commodities and the profits those generate. This blow to the economy is followed by loss of subsidies given to the citizens for fuel and food.

Note that this article is about confirming the lost subsidies which went into effect prior to the article's publication:
Yemen citizens suffer due to lifting oil subsidy
By: Faisal Darem / Yemen Observer / October 14, 2011


Economic experts confirmed prices increase on oil derivatives or lifting oil subsidy reflected prices increase on all foodstuffs and commodities, which added economic burdens on citizens.

Ahmed Saleh, a 35 old years public employee said “I spend the major of my salary to buy petrol.” He continued saying increasing prices from YR 1500 to 3500 for 20 letters [litres?] added economic burdens such as prices increase including all foodstuffs as well as transportations prices. Economic experts warned against lifting oil subsidy which led to catastrophic affects on people as well as on economy.

Taha al-Fusail an advisor of Ministry of Trade and Industry told YO that the lifting of subsidy oil increase prices of all foodstuffs due to prices increase in transport. He added that the increase of oil prices led to negative effects on investment projects in general as well as several factories closed due to the increase of oil prices. ...

... “Things will get much worse if the crisis continues,” he said. Al-Fusail, said that price increases would create many problems, such as local inflation that would exceed the rate of global inflation, which recorded 12% last year and to up to more 30% by the end of this year due to high prices increase. ...

Waking up to discover you cannot afford to eat is strongly correlated with increased unrest and what do we find hot on the heels of this loss of subsidies? Why, more costly attacks against the energy infrastructure as this snowballs.
Gas exports from Yemen's Belhaf terminal halted after assailants attack
Xinhua / October 15, 2011


ADEN/SANAA, Oct. 15 (Xinhua) -- Gas exports from Yemen's Belhaf terminal halted on Saturday after rocket attack by anonymous assailants on a pipeline, which transports gas from Marib province to an exporting port on the Arabian Sea of Belhaf, an engineer told Xinhua.

The local engineer of Yemen's LNG export company led by French oil major Total said on condition of anonymity that gas exports from Belahf terminal was halted after anonymous assailants bombed a key, underground pipeline that extends gas from Marib province to an exporting port on the Arabian Sea.

Early Saturday, a local security official told Xinhua that a pipeline carrying gas from Marib to liquefied natural gas (LNG) plant in Balhaf port was blown up in Shabwa province.

"The targeted gas pipeline located in Rodhoum area, a few miles away from the location of the French giant TOTAL-led Yemeni LNG Company in Balhaf port in southeast province of Shabwa," the official told Xinhua by phone. ...

Yemen LNG Plant Production Halted After Gas Pipeline Attack
By Ayesha Daya and Mohammed Hatem / Bloomberg / October 15, 2011


Yemen LNG, the Arab country’s liquefied natural gas exporter, said production was halted after an attack on a gas pipeline as fighting in the country’s capital, Sana’a, left 16 people dead. ...

... Attacks against the country’s pipeline network have disrupted exports and caused nationwide shortages since protests against President Ali Abdullah Saleh started this year. The Al Shabwan tribe in March blew up part of the pipeline carrying oil from the central province of Marib to Ras Eisa, Yemen’s main outlet for crude exports. The government said it had to raise refined product prices until the line was repaired in July.

... Yemen has the eighth-largest crude reserves in the Middle East and relies on oil sales for 90 percent of its hard currency earnings, according to the U.S. Energy Information Oil Administration. The Arab Peninsula country pumped 260,000 barrels a day of crude last year, down from an estimated 286,000 barrels in 2009 and a 2001 peak of 440,000 barrels, according to the EIA. ...

The plant freezes natural gas into LNG for export, a very costly, very high-tech installation.

The other major example I see of this of this in action is Egypt's gas pipeline to Israel, Jordan, Syria and the Gaza strip via transit gas. Also Libya although in those cases the feedback loop or snowball effect is a bit harder to see.

Egypt definitely had national peak oil issues before they descended into chaos and their pipeline sabotage took off.
Image (click for source)

In Libya the effects have been more recent
Image
This is evidence that the snowball effect is also interacting with other nations in a domino effect way.

We have reached the point where the system is crashing down faster and harder because of the effects of the system crashing: The Snowball Effect.
babystrangeloop
Intermediate Crude
Intermediate Crude
 
Posts: 638
Joined: Sat 25 Jun 2011, 03:34:57

Re: The Snowball Effect

Unread postby dsula » Sun 16 Oct 2011, 15:04:57

babystrangeloop wrote:We have reached the point where the system is crashing down faster and harder because of the effects of the system crashing: The Snowball Effect.


Nothing I see crashing. New box stores are being built in my hood. Chinese plastic as far as an eye can see. 47 cents hamburgers every Tuesday night at McD. Gas basically free at local station ($3.45/gal). Unemployed folks still snobby enough not to have to take plenty of available local farm jobs. Wherever I go I see surplus, waste, abundance, plenty, ...
I've been promised a cleansing by Christmas 2008. How long do I have to wait?
User avatar
dsula
Intermediate Crude
Intermediate Crude
 
Posts: 982
Joined: Wed 13 Jun 2007, 02:00:00

Re: The Snowball Effect

Unread postby babystrangeloop » Sun 16 Oct 2011, 19:59:33

dsula wrote:I've been promised a cleansing by Christmas 2008. How long do I have to wait?

Offhand I think you should ask your cleaning lady or perhaps consider finding a replacement.

Anyway, it's not about you and your cleaning. It's about The Snowball Effect.
babystrangeloop
Intermediate Crude
Intermediate Crude
 
Posts: 638
Joined: Sat 25 Jun 2011, 03:34:57

Re: The Snowball Effect

Unread postby papa moose » Mon 17 Oct 2011, 01:15:32

what's with the little flame symbol next to the thread title?

PS. Chinese Plastic Pumpkins as far as the eye can see, still.
"That really annoying person you know, the one who's always spouting bullshit, the person who always thinks they're right?
Well, the odds are that for somebody else, you're that person.
So take the amount you think you know, reduce it by 99.999%, and then you'll have an idea of how much you actually know..."
papa moose
Heavy Crude
Heavy Crude
 
Posts: 276
Joined: Wed 17 Nov 2010, 00:44:59
Location: Perth, Western Australia

Re: The Snowball Effect

Unread postby babystrangeloop » Mon 17 Oct 2011, 03:41:24

papa moose wrote:PS. Chinese Plastic Pumpkins as far as the eye can see, still.

Maybe your eye, but not mine.
City PMI slides further to 45.9
By Joy Li / China Daily / October 6, 2011


... According to the latest reading of HSBC's PMI released on Thursday, Hong Kong's prevailing business conditions deteriorated further, dipping to 45.9 in September from 47.8 in August, the lowest since May 2009.

A reading above 50 indicates expansion, while that below 50 signals contraction. ...
babystrangeloop
Intermediate Crude
Intermediate Crude
 
Posts: 638
Joined: Sat 25 Jun 2011, 03:34:57

Re: The Snowball Effect

Unread postby kiwichick » Mon 17 Oct 2011, 23:04:18

chinese gdp 9.1%
User avatar
kiwichick
Fission
Fission
 
Posts: 2218
Joined: Sat 02 Aug 2008, 02:00:00
Location: Southland New Zealand

Next

Return to Peak Oil Discussion

Who is online

Users browsing this forum: No registered users and 15 guests