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We Appear To Be Very Close To Peak Global Oil Production, And That Has Enormous Implications For The Entire Global Economy

We Appear To Be Very Close To Peak Global Oil Production, And That Has Enormous Implications For The Entire Global Economy thumbnail

What do you think is going to happen when we get to a point where the world simply cannot produce any more oil than it is already producing?  It is often said that “energy is the economy”, and to a large degree that is true.  Very wealthy nations with large GDPs tend to use a great deal of energy, while very poor nations with small GDPs tend to use a lot less energy.  Just about every form of economic activity requires energy, and so those countries that have a high level of economic activity require more of it.  Of course we live at a time when the total population of the world has been steadily increasing and global demand for energy has soared to unprecedented heights.  Production has struggled to keep up with demand, and now it appears that we will soon reach a point where we are simply not able to produce enough for everyone.

The “green revolution” was supposed to rescue us from this fate, but the “green revolution” has failed miserably.

Just look at Europe.  They told us that they were shifting to “green energy”, but they just kept becoming more dependent on Russian natural gas instead.  Thanks to the war in Ukraine, much of the population of Europe could get extremely cold this winter.

Despite all of the efforts to push us toward “green energy”, our world is powered by traditional forms of energy and that will continue to be the case for the foreseeable future.

And the most important form of traditional energy that we rely on is oil.

Today, there are just three countries that collectively produce close to half of the total global supply of oil…

Despite widespread talk about peak oil demand, the truth is that, for now at least, consumption keeps growing. The world relies heavily on three nations for crude: the US, Saudi Arabia and Russia. Together, they account for nearly 45% of global total oil supply.

Everyone has always assumed that Saudi Arabia could produce a lot more oil per day than it is currently producing, but it turns out that was not true at all

During US President Joseph Biden’s trip to Saudi Arabia, the world was so focused on how Crown Prince Mohammed bin Salman would respond to his plea to pump more oil immediately that it missed a bombshell: the level at which Saudi oil production will peak.

It’s a lot lower than many anticipated. It’s lower than the Saudis have ever intimated. And with the world still hungry for fossil fuels, it spells long-term trouble for the global economy.

Oh yeah, that definitely means big trouble for the global economy.

The Saudis just admitted that “maximum capacity” is 13 million barrels a day, and that figure shocked just about everyone…

For years, Saudi oil ministers and royals have sidestepped one of the most important questions the energy market faces: What is the long-term upper limit of the kingdom’s oilfields? The guesstimate was that they could always pump more, and for longer; if the Saudis knew the answer, they kept it secret. And then, almost casually on Saturday, Prince Mohammed broke the news, revealing that the ultimate maximum capacity is 13 million barrels a day.

If the Saudis can’t do it, where will we turn for additional capacity?

We could always try to do more drilling here in the United States, but the truth is that conventional oil production in the U.S. peaked long ago.  In a desperate attempt to become less dependent on foreign oil we ramped up unconventional oil production, and that created a “mini-boom” for a time

Many early peak oil analysts predicted that the maximum rate of oil production would be achieved in the 2005-to-2010 timeframe, after which supplies would decline minimally at first, then more rapidly, causing prices to skyrocket and the economy to crash.

Those forecasters were partly right and partly wrong. Conventional oil production did plateau starting in 2005, and oil prices soared in 2007, helping trigger the Great Recession. Afterward, however, there was strong growth in production of unconventional oil from deepwater wells and Canadian oil sands, and especially from tight oil (also referred to as shale oil) extracted by horizontal drilling and fracking. The US, whose petroleum production rate had been generally declining since the early 1970s, hit new all-time highs as tight oil gushed from North Dakota and Texas.

But now we are reaching the limits as far as what we can do with unconventional production.

It is becoming increasingly difficult and increasingly expensive to get oil out of the ground, and that is a huge problem.

Cheap oil fueled our economic boom times for many years, but now those days are over.

As for Russian oil production, there is so much that we don’t know.

But I did find it alarming when I read that oil shipments to China and India are way down

There are tentative signs that Russia’s diversion of crude oil to Asia from long-time European customers is faltering. Shipments to China and India are down by almost 30% from their post-invasion peak.

And the Russians have told us that they expect oil production to decline “by as much as 17% in 2022”

Russia may see its oil production fall by as much as 17% in 2022, an economy ministry’s document seen by Reuters showed on Wednesday, as the country struggles with Western sanctions.

The United States has banned Russian oil imports, while Western sanctions against Russian banks and vessels had crippled the oil trade, one of Moscow’s key sources of revenue. The European Union is also considering fully banning Russian oil.

Global supplies of oil have been getting tighter and tighter, and there have been stretches this year when daily global consumption of oil has exceeded daily global production of oil.

If we are at or near peak global oil production right now, what will our world look like once we get past the peak and global oil production actually starts steadily declining?

If you think that gasoline prices are bad now, just wait until we get to that stage.

Plus, there is the potential that a major war in the Middle East could erupt at any time.

Once that happens, the price of oil will go completely nuts.

A lot of people out there seem to think that we will have some sort of an “economic collapse”, but afterwards we will rebuild and life will go back to normal.

That is not what we are facing.

As I discussed in an article that I posted earlier today, what we are facing is literally the collapse of everything.

We are running out of energy.

We are running out of topsoil.

We are running out of clean water.

And we are already witnessing mass extinctions all over the planet.

There is something that I have been saying a lot lately, and I am going to say it again.

The clock is ticking for humanity.

Decades of incredibly foolish decisions have brought us to the brink of a planetary nightmare, and there isn’t going to be any easy way out of this mess.

endoftheamericandream.com



32 Comments on "We Appear To Be Very Close To Peak Global Oil Production, And That Has Enormous Implications For The Entire Global Economy"

  1. Theedrich Yeat on Sun, 24th Jul 2022 1:58 am 

    The U.S. is the world’s expert in false flags. Its lapdog, the U.K., has shrunk back to its pre-industrial size.  The berserk lies and diversions (“culture war” outbreaks) from the U.S. regime and its paymasters are meant to distract the electorate from the fact that the superduper nation is facing its demise.

    The perversions of all types in America make Sodom and Gomorrah look like children’s play.  The aim is to pollute the genetic base of the U.S. to the point where it is populated only by atavistic primitives sporting gorilla nasal structures.  The old “panis et circenses” (“bread and circuses”) ploy is intensifying with calls for “guaranteed annual incomes” and free entertainment for all human detritus, while the pompous economic gurus and science ignorami make off with 90% of the national wealth.

    On the bright side, Leftists of all stripes are now sterilizing themselves, which means that normal humans of European descent have at least a chance of survival.  If, that is, they are not swallowed up in the rage to destroy their own brains and derange themselves with narcotics.  And if the Pentagonians (the MIC) and neocons do not launch nuclear war — an increasing probability.  It must be remembered that America’s favorite military tactic is to destroy all civilians of a nations whose resources we seek.  A typical slogan is “Bomb them back to the Stone Age!”  Much easier than fighting peer militaries.  One could get hurt that way!

    Any way you cut the cake, America’s days are numbered.  As for Europe, now under the dictatorial control of the U.S., its only hope is to unchain itself from the imperial Death Star on the other side of the Atlantic and come to a decent modus vivendi with Russia.

    Which would make the Washington demigods faint with despair.

  2. makati1 on Sun, 24th Jul 2022 5:45 pm 

    Correction: ”

    “We Appear To Be Very Close To Peak Global CHEAP Oil Production, And That Has Enormous Implications For The Entire Global Economy”

    Yes, we have been giving away energy so cheap that we will now have to pay more and more for a necessity. If oil went for $1,000/bbl there would be plenty. I think that day is fast approaching.

  3. Biden's hairplug on Mon, 25th Jul 2022 2:08 am 

    The WEF and its James Bond villain Klaus Schwab at it again!

    https://newsthud.com/world-economic-forum-calls-to-end-wasteful-private-car-ownership/

    “World Economic Forum Calls to End ‘Wasteful’ Private Car Ownership”

    Everybody and his mother on hind legs.

    Of course, Herr Schwab has a point, it’s just that the world isn’t quite ready for this message, they want to continue to fly, drive and hog as if there is no tomorrow. And his German accent doesn’t quite help either, brainwashed as the world is with WW2-propaganda.

    Whatever. The world is near peak oil production, prices will soon rise rapidly and ever fewer people will be able to afford to maintain their privately-owned clunker, regardless of what Schwab says.

    No worries though, most people will remain somewhat mobile, albeit not in their own car, but via shared travelling in autonomous driving vans, up and down the highway, enormously saving on fuel and amortization cost.

    You won’t own a car and you’ll be happy. Finally, an escape from the eternal rat race of having to own everything and having to run your legs out to get it.

  4. Biden's hairplug on Mon, 25th Jul 2022 2:34 am 

    The absolute nightmare that modern mass tourism has become:

    https://www.dailymail.co.uk/news/article-11044829/Tourists-face-travel-chaos-lasting-year-delays-spread-ferries-Eurostar-trains.html

    “Channel holiday hell is only just beginning! Tourists face travel chaos lasting ALL year – as delays spread from ferries and Eurotunnel to Eurostar trains and ex-minister tells people trying to get to France ‘go somewhere that welcomes you instead'”

    Hundreds of thousands crammed together in small spaces like airports, trains, planes, merrily exchanging their body fluids through the air, to ensure that all sorts of viruses are brotherly shared, all over the planet.

    #PlanetOnTheLoose

  5. Biden's hairplug on Mon, 25th Jul 2022 2:39 am 

    Inflation may hit 15% in Britain this winter:

    https://www.dailymail.co.uk/news/article-11044827/Inflation-hit-15-winter-Bank-England-hints-considering-steeper-rate-rises.html

    Won’t be much different elsewhere in Europe. Main reason: steep increasing energy prices.

    That Ukraine adventure isn’t working out too well, now, does it? Remedy: dump America, abandon NATO and make a deal with Russia. All problems solved.

  6. Biden's hairplug on Mon, 25th Jul 2022 5:01 am 

    Russia confirms that it intends to topple the Zelensky regime:

    https://www.spiegel.de/ausland/ukraine-krieg-russland-bestaetigt-plaene-fuer-sturz-der-regierung-in-kiew-a-d5b8fab2-b715-4bf6-8c60-f30878401274

    They would not have stick their necks out thus far, if they didn’t feel strong enough to make it happen.

    Bye-bye, Euro-Maidan.

  7. noobtube on Mon, 25th Jul 2022 4:25 pm 

    White supremacy until the last breath, I see.

  8. makati1 on Mon, 25th Jul 2022 5:40 pm 

    Russia is moving to build a buffer zone from the West. They have no interest in the US or EU now. You don’t get robbed, shot at and stabbed in the back and want to make friends with your assailant.

    The whole world is watching this attack by the mafia US and are learning to avoid the Empire of Lies in the future. The West is isolating itself instead of Russia, China, Iran, etc..

  9. Cloggie on Tue, 26th Jul 2022 3:44 am 

    For once, I agree with Klaus Schwab and his WEF:

    https://newsthud.com/world-economic-forum-calls-to-end-wasteful-private-car-ownership/

    “World Economic Forum Calls to End ‘Wasteful’ Private Car Ownership”

    “The globalist elites say too many people own private vehicles for the planet’s good”

    Is this a wise thing to say for Klaus and his Bond Villain German accent and persona?

    Not really. But this wish will be realized by reality itself, not by the alleged huge influence the WEF is supposed to have.

    By 2030, you and I won’t possess a car, neither ICE nor electric. Mother Earth will no longer be able to cough up the resources for 1 billion+ cars.

    No worries, you will remain mobile, even more comfortably so and affordable than before. 1 billion cars that stand idly by the wayside for 98% of the time, are a terrible waste.

    https://deepresource.wordpress.com/2017/05/16/by-2030-you-wont-own-a-car/

  10. Cloggie on Tue, 26th Jul 2022 12:41 pm 

    Construction world’s largest offshore wind farm Doggerbank has begun:

    https://deepresource.wordpress.com/2022/07/26/construction-largest-3-6-gw-ofw-park-has-begun/

    3.6 GW

  11. Cloggie on Tue, 26th Jul 2022 1:02 pm 

    Two eggs per day is all the protein you’ll ever need.

    Skip the Big Whopper and the rest of the meat:

    https://www.youtube.com/watch?v=j8qlrFrvpvE

  12. makati1 on Tue, 26th Jul 2022 4:46 pm 

    Cloggie, you typify all of the insane people trying to change the world to fit their idea of paradise. Or maybe it is the drugs you are addicted to? Either way, you really need help.

  13. Biden's hairplug on Tue, 26th Jul 2022 5:56 pm 

    Oh dear, Orban’s long-time adviser and ally Zsuzsanna Hegedus has resigned because of a “nazi speech”, pleading against race-mixing and open borders.

    Here she is:

    https://budapestbeacon.com/meet-zsuzsu-hegedus-advisor-to-viktor-orban-on-social-inclusion/

    Quiz… what’s her background?

    1. Hungarian
    2. Belgian
    3. American
    4. Eskimo
    5. Different, namely?

    The one who sends in the correct answer will receive a free Google Maps guaranteed shortest route from your home to the Auschwitz State Museum in Poland.

  14. Jerome Purtzer on Wed, 27th Jul 2022 9:21 am 

    Great summary of our current situation. The only omission was the impending collapse of our oceans due to irresponsible fishing, pollution and temperature change.

  15. makati1 on Wed, 27th Jul 2022 4:45 pm 

    Cheap oil is gone. Cheap energy is gone. Many changes coming in the next few years and most will be very painful to the 1st world.

  16. Adonis on Wed, 27th Jul 2022 9:00 pm 

    Peak oil was passed in late November 2018 the elders have been playing games on humanity for quite some time now climate change games vaccine games all in the name of less to go around for 8 billion humans so steps need to be taken to avoid mad max world outcomes .

  17. victoria carpentry on Wed, 27th Jul 2022 10:50 pm 

    I agree that cheap oil is long gone. I hope in the years to come, we can resolve this issue.

  18. Bellid on Wed, 27th Jul 2022 10:52 pm 

    I agree that cheap oil is long gone. I hope in the years to come, we can resolve this issue.
    Victoria Carpentry

  19. Cloggie on Thu, 28th Jul 2022 6:30 am 

    UK Met Office: sea level rise UK at 0.51 cm/year and accelerating.

    West-Netherlands probably gone in 200 years:

    https://deepresource.wordpress.com/2022/07/28/sea-level-rise-currently-0-51-cm-year/

  20. Cloggie on Thu, 28th Jul 2022 9:44 am 

    Damn! One important argument less, the renewable energy skeptics have against wind turbines. UK and US companies develop magnet without rare earths and apply it to a 15 MW wind turbine:

    https://deepresource.wordpress.com/2022/07/28/15-mw-wind-turbine-without-rare-elements/

  21. makati1 on Thu, 28th Jul 2022 4:48 pm 

    Cloggie, “develop” does not mean practical or ever in use. Not going to happen. Remember the “To cheap to meter” electric when the governments wanted the serfs to pay for nuclear bomb fuel factories? I do.

    BTW: How are the greenies going to build millions of windmills without FFs? They are already giving up being warm and clean and eating bugs. LOL

    The P’s are moving to nuclear. The West is moving away. Interesting.

  22. Cloggie on Fri, 29th Jul 2022 9:14 am 

    What comes after the car?

    https://deepresource.wordpress.com/2022/07/29/the-dutch-cycling-revolution/

    “The Dutch Cycling Revolution”

    British documentary.

  23. Biden’s hairplug on Fri, 29th Jul 2022 11:29 am 

    Bring it on, Julius!

    https://www.dailymail.co.uk/news/article-11062235/White-people-target-South-Africas-Julius-Malema-warns-impending-violence.html

    ‘White people will be the first target’: South Africa’s Julius Malema warns of impending ‘violence’ because ‘the poor are getting poorer’

    …and torpedo the US oligarch dream of a totally mixed world once and for all and replace it with The Big Divorce.

  24. makati1 on Fri, 29th Jul 2022 4:44 pm 

    Bicycles Cloggie? The most popular transportation in poor countries. Hmm.

  25. Cloggie on Sat, 30th Jul 2022 4:06 am 

    “Bicycles Cloggie? The most popular transportation in poor countries. Hmm.”

    What are you trying to insinuate?

    The Netherlands has an advanced bicycle infrastructure, because we are rich, not because we are poor.

    English 15 minute doc about how the city of Groningen (200k) almost entirely got rid of the car:

    https://www.youtube.com/watch?v=1Mr4THWBGaw

    And note, this is before the advent of the e-bike, which even lowers the threshold towards moving to bicycles in the cities.

    We are moving towards a global transportation system without (mass) private car ownership towards: walking, cycling, bus, tram, train and autonomous driving van taxis, between cities that are not connected to the rail system.

    This is far more efficient and cheaper per mile than the untenable 1 billion+ cars, for which fuel and resources are going to fail, not to mention pollution. Not even e-cars are going to replace ICEs 1-on-1. We are too late for that with the renewable energy transition. And the Ukraine war isn’t helping either.

  26. Michael Lardelli on Mon, 1st Aug 2022 8:46 am 

    “Very Close To Peak Global Oil Production” ??
    Looks like it was over 3.5 years ago in November 2018. That was already pushing up oil prices before the pandemic hit. Global net energy from oil must already be decreasing quite rapidly.

  27. PeterEV on Mon, 1st Aug 2022 12:12 pm 

    Backed in 2004(?), Matt Simmons wrote: “Twilight in the Desert” about the potential peaking of Saudi Arabia oil production. He and his Saudi counterparts met at the Center for Strategic and International Studies. Simmons basically said they don’t have the oil reserves and the Saudis said they did.

    The Saudis produced slides in which one depicted that if the Saudis produce 10mbod, they would peak around 2042(?). If they produced 12mbod, they would peak around 2034(?). In an emergency situation, they could produce 16mbod but no indication as to how long.

    The bottom line of 13mbod is up from that 12mbod figure.

    In Tom Whipple’s Weekly enewsletter for this week, the Energy Bulletin with Steve Andrews, there was a link to an article entitled:

    July USA Gasoline Demand Readings Lower Than Pandemic Era

    https://www.rigzone.com/news/july_usa_gasoline_demand_readings_lower_than_pandemic_era-27-jul-2022-169779-article/?mc_cid=fd2dc9147e&mc_eid=d2e8ef8ff

    I wonder if Rigzone has figured out how much of that can be attributed to use of EV and hybrid vehicles. There was not mention of what inroads these two types of vehicles are having on gasoline and diesel consumption. this would make an interesting study.

  28. betflix on Mon, 1st Aug 2022 12:54 pm 

    Everyone an extremely breathtaking chance to read from this blog. It is always so lovely and jam-packed with a great time. betflix

  29. Femund on Thu, 4th Aug 2022 4:07 am 

    Quite, quite, energy feeds and entertains the masses. One can argue that entropy produced life to reduce excess energy and that is what we are doing, like kids with fireworks.
    Until their is a well defined and agreed goal for humankind then excess consumption in order to satisfy personal desires will be the norm. This is nothing new but is a #hugechallenge to satisfy personal desires in a consumption based economy without and energy surplus.

  30. LGBTQIXYZ- non binary frogman on Sat, 13th Aug 2022 11:42 am 

    Klaus Schwab is my lover, he has a tiny penis but very sexy toes!!

    Did I mention Davis?

    Oh it’s lovely darlings!!

  31. Benjamin Goldstein the hook nosed yid on Sat, 13th Aug 2022 11:43 am 

    Liquid farts are amazing

  32. FamousDrScanlon on Sat, 13th Aug 2022 12:08 pm 

    Spend your dopamine dollars while you can.

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