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Hindsight 10 Years After Peak Oil

Hindsight 10 Years After Peak Oil thumbnail

All views expressed here are those of Verwimp Bruno and do not necessarily represent those of WAKE UP HOMOSAPIENS.

1. Introduction

peak_oil_curve

Peak Oil is the moment in time when, on a global scale, the maximum rate of oil production is reached. The moment after which oil production, by nature, must decline forever. Since Earth is a closed system, next to this production (supply) event, there must be an equal demand event: Peak Oil Consumption. Since there are no substantial above ground deposits, Peak Oil Production and Peak Oil Consumption must coincide. The world consists of a lot of different countries, some of which are already far beyond peak oil production That leads to the assumption the world as a whole reaches peak oil production. On the demand side, it is worth looking, because different countries have different economies, different degrees of development, and so on, if, while some countries still experience significant growth in oil consumption, some countries are already well beyond Peak Oil Consumption by now.

2. Production vs Consumption

The production history of crude oil is well documented. It is clear some countries have reached peak oil production long time ago. For readers of this blog, familiar with these data, this is no surprise. Still world oil production is growing, because some countries make up for the countries that are losing production. But how relevant is that moment? Will it bring doom, gloom, the end of motoring, plastics and tooth paste. It might be more interesting to know whether your country is before, beyond or at Peak Oil Consumption right now. And what about coal and natural gas?

3. The Bell-Shaped Curve

Finite resources tend to be exploited as fast as possible, resulting in an ever increasing “production” (“mining” is the more correct term), until a limit is reached, after which production declines. The result is the bell-shaped curve M. K. Hubbert showed the world in A.D. 1956:

Bell-Curve

We all know this curve did not materialise exactly this way. The peak was set at 13 billion barrels per year, while the world produces some 32 billion barrels per year now. Nevertheless that production must decline sooner or later. Oil is still a finite resource.

In A.D. 1972 researchers from M.I.T. wrote Limits to Growth, Report to the Club of Rome. They analysed the word as a whole and took different parameters into consideration: Finite resources, finite absorbing capacity of the world’s ecosystems (climate!) and human population. The standard run of their model looked like this:

Figure-35

In this graph resources are depictured as an inverse cumulative function, starting at 100% in the upper left corner and ending at near zero in the bottom right corner. When that graph wouldn’t have been cumulative, it would have been a bell-shaped curve. The ‘industrial output per capita’ curve reflects the use of resources and is indeed bell-shaped. The graph with the ‘S’-dots, indicates services per capita. That graph goes higher than industrial output, and starts to decline later. The contemporary deindustrialisation of the USA and Europe, and their growing service economies are in line with the standard run of the World Model.

In June 2015 the leaders of the G7 gathered in Schloss Elmau, Germany, for their annual Summit. Afterwards the Leadersʼ Declaration was released. A chapter is dedicated to climate change. The leaders say: “Mindful of this goal (to hold the increase in global average temperature below 2 °C. ) … we emphasise that deep cuts in global greenhouse gas emissions are required with a de-carbonisation of the global economy over the course of this century. Accordingly… we support … the upper end of the latest IPCC recommendation of 40 to 70% reductions by 2050 compared to 2010 … .

When the evolution of the energy consumption of the world, of which nowadays approximately 85% consists of greenhouse gas generating fossil fuels, is extrapolated to the end of the century, when a fixed point of nearly 0% fossil fuels at A.D. 2100 and a fixed point of “40 to 70% reduction by A.D. 2050”, say 50% reduction, is set, when the current growth in use of fossil fuels is gradually turned in an as moderate as possible decrease, meeting the two fixed points, when the evolution of nuclear, solar, wind, hydro and biomass is counted in in an optimistic way, the future looks like this diagram:

World-Energy-Consumption

The G7, from a climate change point of view, Hubbert from a finite resources point of view and the Club of Rome from a combined point of view, they all predict roughly the same bell-shaped curve. So the bell- shaped curve is going to be it. Notice there is no significant distinction between oil, coal and gas.

4. Availability & Affordability of Energy as a Limit

Different countries in the world have different economies, different degrees of development, different GDP/capita ratio and so on. But if the world as a whole is projected to walk along this bell-shaped trajectory, it is reasonable to hypothesise every country on itself will follow that trajectory sooner or later. Recent data until A.D. 2014, collected by BP, seem to already give evidence of this hypothesis.

World-Consumption

World energy consumption equals 500 exajoules per year. The curve shows growth. So availability is not yet a problem.

FSU-Consumption

The former Soviet Union consumes a little less than 40 exajoules. That is 8% of the global consumption and about 25% lower than their peak in 1991. It is clear the Former Soviet Union might never again reach the >50 exajoules they used to consume.

European-Consumption

Europe minus the Former Soviet Union consumes 60 exajoules per year. That equals 12 % of the world energy consumption. The decline since 2006 is 18%. That is significant and severe.

North-America-Consumption

North America consumes 110 exajoules per year. That equals 22% of the world energy consumption. The deadline since 2008 is about 5%. That might not be statistically significant. Nevertheless: there has been no more growth since 2000. On the global timescale 15 years is a significant period of time.

All the above summed up, equals 42% of the world energy consumption. Add Japan, Australia and South Africa, with stagnant or declining energy consumption too, and the conclusion is: “Half of the world’s energy production is consumed in countries with declining or stagnant energy consumption. These are all the mature first world economies.

The decline in energy consumption might be caused by local availability issues or affordability issues. Most probable explanation might be: heavy industries have left these countries, the poor and the elderly –groups with less than average energy consumption- are growing groups in these societies.

5. Projections

World-Consumption1

The above graph, in Mtoe, is constructed using Hubbert Linearization. This technique is unreliable unless the available data suggest the bell-shaped curve has already gone thru its first infliction point, and it gains reliability when the peak is reached or passed. This means there are enough data for the world, for Eurasia and for North America. There are not enough data for Asia-Pacific, nor for south and Central America, Africa and the Middle East. To reduce the mathematical problem to a system of two equations and two unknown variables, South and Central America, Middle East and Africa were grouped and called “Scamea” in the graph.

The sudden drop in 2015 is artificial. It results from the fact that the latest data points in the linearisation of the global data are slightly above the trend line.

The results of this exercise are:

– Europe and the former Soviet Union (Eurasia), has peaked.

– North America has peaked.

– Asia Pacific is peaking as we speak.

– The group consisting of South and Central America, the Middle East and Africa had a large potential for growing energy consumption.

6. Oil, Coal, Gas

Historical data show the growth in coal, oil and gas consumption vary widely in time and space. But the decline of coal, oil and gas consumption coincides more or less, especially in times of crisis: Former Soviet Union post 1990 and Europe post 2006. This supports affordability, rather than availability is the root cause of declining consumption. This thesis is often proposed by Gail Tverberg.

World-Oil World-Natural-Gas World-Coal

More than half of the world’s oil production is traded on the international markets. Still Net Export Mathematics, or the Export Land Model, shows severe concern about future oil availability to importing nations. For gas only a third of the world’s production is traded on the international markets. For coal it is only a fourth. Applying ELM on coal or gas will paint a grim future for importing countries as well as for countries dependent on the revenue of their exports.

7. Conclusions

Peak Oil translates into Peak Oil Consumption. Peak Oil Consumption comes with Peak Energy Consumption. Half of the world has passed the point of maximum energy consumption. This point is marked by large scale economic crisis. Asia Pacific is approaching that point now. For energy importing countries with still growing energy consumption Peak Energy Consumption may rather be triggered by coal or gas, since these global markets are tighter than the oil market. Renewables do not play any role.

wakeup.stubbornbull.com.au



19 Comments on "Hindsight 10 Years After Peak Oil"

  1. Truth Has A Liberal Bias on Mon, 20th Jun 2016 10:17 pm 

    My prediction for how the Retarded States of America will handle Peak Oil

    https://youtu.be/Bbv5B71KmkA

  2. Plantagenet on Mon, 20th Jun 2016 10:18 pm 

    Somehow we’ve gone from concerns about peak oil with energy scarcity and high oil prices to a totally different situation caused by a global oil glut with low oil prices and an overabundance of oil production around the globe.

    Cheers!

  3. Go Speed Racer on Mon, 20th Jun 2016 10:19 pm 

    The R.S.A. ???
    Dont be insulting this great country.

    It is the U.P.S.A.

    The United Police States of America.

    Use the correct name, with pride.

  4. Plantagenet on Mon, 20th Jun 2016 10:23 pm 

    Don’t forget the Truly Dumb Provinces of Canada. Global warming triggers off huge forest fires that burn up Fort McMurray and huge areas in Alberta and the Canadian response is……to get those oil shale mines up and running full time again to pump more CO2 into the atmosphere!!!!

    Dumb dumb dumb.

    Cheers!

  5. antaris on Mon, 20th Jun 2016 10:58 pm 

    Plant, it is called Bitumen. If you are in a hurry, Tar works also.

  6. Apneaman on Tue, 21st Jun 2016 1:41 am 

    psssst planty, pssst…you might want to lay low for awhile. I hear the FBI is combing the intertubes looking for retards to frame for terror plots.

    Stay frosty planty, we would hate to lose you to Guantanamo.

    Why Does the FBI Have to Manufacture its Own Plots if Terrorism and ISIS Are Such Grave Threats?

    https://theintercept.com/2015/02/26/fbi-manufacture-plots-terrorism-isis-grave-threats/

  7. makati1 on Tue, 21st Jun 2016 3:31 am 

    Planty is counting the billions of barrels of “recoverable” oil in the asphalt roads of America in his numbers.

  8. PracticalMaina on Tue, 21st Jun 2016 8:39 am 

    We can just burn the air after the methane clathrate all releases.

  9. rockman on Tue, 21st Jun 2016 10:07 am 

    Sources of global energy production MODELED more then 40 years into the future. Imagine the completely unsupportable assumptions this model is built upon: such as how much energy will be produced by solar in 2070.

    All I can do is remind folks that models are great (IF there are constructed properly) at showing sensitivities of the factors but suck at predicting if they don’t get the multiple assumptions correct.

    IOW models are like masturbation: absolutely nothing wrong with either…as long with either as long as you don’t start believing they are the real thing. LOL

  10. PracticalMaina on Tue, 21st Jun 2016 10:20 am 

    Extrapolate what is happening now with the climate, and the feedback loops that are going to occur, we are all going to need to cease using fossil fuels well before 2070. Europe is starting to get in right, if we dont get rid of ICE within a couple decades, we are gonna be completely screwed.
    Saw an article on FOX today pointing out melting permafrost in the arctic and mentioning the feedback of methane….on fox…

  11. marmico on Tue, 21st Jun 2016 11:38 am 

    Wow, PODMAN is bitching about a 40 year forecast.

    Wow, where is the PODMAN’s empirically tested to the 90% confidence level backcast?

    For the word salad types, when does the POD, man, forecast the 12 month strip to flip from contango to backwardation?

    It’s the POD, man, because only the PODMAN knows as he drops another tool in another hole.

  12. dougt on Tue, 21st Jun 2016 2:04 pm 

    Peak Oil should not be thought of in terms of a “moment”; this only fuels fire on the interwebs as to who is “right” or “wrong”, fun as some consider that exercise.

    It is an era, and we’re in it now. Wildly inelastic price behavior, with lows induced after very expensive resources are enabled by highs, shoulda and coulda have been expected, and will likely continue.

  13. DontGetOutMuch on Tue, 21st Jun 2016 2:24 pm 

    Except that “Peak Oil” has been predicted to be around the corner for the past 50 years. If you haven’t noticed, the world is awash in oil, and there is more in the ground than you can drill. Also The U.S. has enough Oil, Gas, and Coal to last for at least 300 years. Furthermore. If oil was drying up, you would see an increase in nuclear power in your petty graphs. I don’t see that… Get yourself a sandwich board and join the rest of the fruit loops on the street corner.

  14. PracticalMaina on Tue, 21st Jun 2016 2:32 pm 

    Dont get out much must not read much, you dont appear to be familiar with Fukushima.

  15. PracticalMaina on Tue, 21st Jun 2016 2:34 pm 

    Tepco just admitted they were covering up the large scale and huge ecological damage that occurred when they had multiple simultaneous meltdowns. It will cost hundreds of billions to clean up that site, and thousands of years before the radiation approaches background levels.

  16. ghung on Tue, 21st Jun 2016 2:52 pm 

    Worry not, PM. Natural selection will weed out those like DontGetOutMuch eventually. For much of our history, babies like DontGetOutMuch would have been victims of infanticide because the societies couldn’t afford to pollute the gene-pool with those who obviously would have no useful skills to contribute going forward.

  17. JuanP on Tue, 21st Jun 2016 3:31 pm 

    Practical “It will cost hundreds of billions to clean up that site…”. It will cost at least hundreds of billions to attempt to clean up that site and the cleanup will fail completely. There, fixed it for you.

    Fukushima, the gift that keeps on giving! LOL!

  18. theedrich on Wed, 22nd Jun 2016 4:39 am 

    As usual, the most important facts are omitted:  it is dusky featherless bipeds who are using the fossil fuels and overloading the biosphere.  Their numbers are increasing madly, and the White countries are importing more and more of the dark sludge that demands “its share” of earth-destroying toys and energy.  Clouds of low-IQ, useless eaters are crowding into Europe and America because the sob-story organizations require it.  Mohammedans don’t stay in Saudi Arabia, and that country also accepts no Allah-devotees or Negroes as refugees from other wastelands in Africa and southeast Asia.  Only Whitey must swallow the septic masses.

    To divert attention from this suicidal process, much hullabaloo is raised over peak oil, fracking, coal emissions, disintegrating infrastructure, etc., etc., interspersed with large dollops of guilt propaganda about Whites, going back to the crusades.  The grotesque corruption of Western governments (including Canada’s) is skimmed over lightly, less it disturb the sleep of the comatose citizenry.

    The collapse of the western Roman Empire was a small event compared with the fiery plunge we are going to see once the ThirdWorld reptiles take over.  The U.S. Constitution will be replaced by Sharia law, the central-city Negroes will start rampaging outside of their reservations, and Whitey will everywhere go into fetal position to avoid dealing with the increasing chaos.  After all, Jesus promises him wonderfulness six feet under.

  19. Bruno Verwimp on Wed, 17th Aug 2016 6:22 pm 

    Hi there,

    After googling myself, I found my article, first published on Peakoilbarrel.com on your site. Apparently you got it from WAKE UP HOMOSAPIENS.
    I’m glad to see people think it’s relevant.
    But…
    You might have kept the original graph as the front graph, because I think it’s the most important one.
    And…
    You might have asked me for an update, since the article is nearly 1 year old.

    I’m not too hard to google.

    Best regards,

    Bruno Verwimp

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