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Is the world heading towards Peak Oil?

Geology

Let’s park up all the environmental downsides of oil usage for the moment. Because despite all of oil’s sins, most of humanity depends on it for everything from the clothes we wear to the means we employ to get about. Even a lot of the food we eat and many of the modern medicines that help keep so many of us well are in some way linked to the petrochemical industry.

But as we know, crude oil is a finite resource. Not that anyone would ever believe it when observing the accelerating rate at which it’s being pumped out of the ground. Oil is becoming an increasingly precious commodity. Worryingly, as it becomes more and more complicated to source and extract, it gains an ever greater capacity to hold our modern civilization to ransom.

All this might sound a bit melodramatic. But the plain, simple truth is our modern culture is actually perched on an oily knife edge. The slightest threat to global supplies almost instantly impacts the price we pay for just about everything. Naturally, this factor directly affects the way millions of us live out our daily lives. So it matters.

Oil supply threats can come in many forms such as geopolitical tensions, demand or distribution issues caused by extreme weather or other unpredictable natural phenomena. Of course, there will always be a large dollop of plain old fashioned profiteering going on too. Traders will be forever keen to make a swift killing on global commodity exchanges, putting us all at the mercy of a bizarre system.

High oil demand is usually a sign of healthy economic activity. Perversely, favourable economic prospects always seem to push up the price of oil because we use more of it during boom times. Other commodities then follow suit. This, in turn, stokes up inflation. Of course, high inflation is harmful to western economic models. So, you see the problem here? It’s a self propagating mess.

Prolonged inflation eventually forces a downward price spiral due to reduced demand. Basically if goods (including oil derivatives) get too expensive, it causes demand destruction. Then, economies go into recession. Boom equals bust.

Peaks and troughs

However, traders love peaks and troughs. They will declare that “the trend is their friend” or that “nothing cures high prices like high prices”. Well, we already know about demand destruction.

But, these rather strange and illogical perversions of Capitalism have long governed our existence. Whether we approve or disapprove very much depends on individual outlooks. It amounts to whether or not we believe that we’ve personally gained from such a system.

Environmentally, we’ve all clearly suffered whether it’s from harmful fossil fuel emissions or from matters such as the increasing prevalence of toxic plastic waste in our natural environment. Consumption creates waste. That’s just the way it is.

The economics of fossil fuels have long shaped the fortunes of modern western societies. These days, it’s not just the west that’s impacted by energy price volatilities. There is an undeniable correlation between global population growth, the pace of fossil fuel extraction, global economic prospects and the consequent increase in emission levels.

There will doubtlessly be a few Professor Yaffel characters out there who will be exclaiming “Nonsense! Nonsense!”. They’ll be saying that such comments (made by the likes of yours truly) are a gross oversimplification of what is a deeply complicated issue. Maybe so. Personally, I just try to face facts as I see them. Let’s be candid: If there were only 7.7 million people living on this earth right now rather than the current 7.7 billion inhabitants – I suspect that the story would be a somewhat different one when it comes to global consumption?

Peak oil

The crunch will come when our world reaches something called ‘Peak Oil’. So what’s Peak Oil all about?

Professor Yaffel is right about my desire to simplify a complicated topic. So I hereby hope to explain Peak Oil without causing my brain to explode:

Peak Oil identifies a hypothetical point in time when global crude production and refinement hits the maximum possible rate at which current infrastructures can efficiently operate. Once this happens, crude oil production will decline at a rapid pace. Luckily for us, Peak Oil remains a hypothesis.

Or is it?

The theory suggests that oil production will decline as the cost of extraction grows. But the ‘easy oil’ has been dwindling for years. North Sea oil for example. Depleting oil reserves puts global inventories under increasing pressure. It becomes the catalyst for rapid price hikes as the industry struggles to replenish global stocks. The market is getting increasingly tight as more and more countries strive towards industrialisation.

Peak Oil has been declared several times amidst various crises over the years. However, each time we get a Peak Oil declaration, it has invariably proved to have been a premature call. But, that’s only been thanks to higher oil prices funding new extraction technologies and more sophisticated surveying techniques. This has thus far somehow saved our bacon.

Today, however, things are very different. Emerging economies are now more than just emerging. Some are now wholly and massively established mega giants in their own right. China alone has grown on a miraculous, mind-boggling and unprecedented scale.

Emergence of China

The Chinese don’t hang about! If the Chinese authorities want to build a motorway or a new airport, there’s no protracted 10 year consultation period with millions of pounds being wasted on absolutely nothing. There will be no Chinese ‘environmental impact assessment committee’ to help protect the habitat of the lesser spotted NIMBY. The Chinese don’t bother with any of that – they just build things. Fast! Thousands of miles of motorways are carved magnificently into China’s landscapes each year. There are no obstacles to progress in the People’s Republic.

The emergence of China as the world’s second largest economy has massively increased demand for oil as never before. Bear in mind that the world’s major oil fields (first tapped into over 40 years ago) are now in terminal decline. No one seems to want to fess up to precisely how quickly they’re drying up but we all know that they really are being depleted at record speed.

Best estimates suggest that productivity decline from the major oil fields currently stands at around 5 million barrels per day (that’s 5 million fewer barrels per day than was produced at their peak). The shortfalls are currently being made up by other smaller producers but they won’t last forever. In stark terms what this means is that the oil industry needs to find new reserves that are equal or larger to those currently existing in Iran or Iraq every single year in order to simply keep up with current demand.

So next time you feel the pain in your wallet at the petrol pump, look around you and think about how much of what you behold is somehow made of oil. Where would we be without it? That’s a pretty good question!

PortugalNews



76 Comments on "Is the world heading towards Peak Oil?"

  1. makati1 on Fri, 10th Jun 2022 4:41 pm 

    Cloggie, still pushing renewable stuff? Europe is going down the shitter with the US.

    Neither will be buying any cars and certainly not electric.

    Neither has the electric grid to support them and never will.

    Not to mention that both are in the 3rd world now.

    Food and shelter is the new goal, not “green”.

    Potassium Iodide pills are the new insurance. The only important one if there are nukes flying.

  2. VanguardWorshippingTheNegro on Fri, 10th Jun 2022 6:29 pm 

    Vanguard mutual fund worshipping the negro. Almost all negro. Barely no Asians and Whites

    https://www.youtube.com/watch?v=C8jm31cM7Nk

  3. BlackRockDoingComedyVideo on Fri, 10th Jun 2022 9:04 pm 

    0:33 look like a comedy shot. I did not know BlackRock was into making small comedy video on youtube.

    https://www.youtube.com/watch?v=gKZidz4aO9E

    We are now living in a reality that make fun of itself and moving at accelerated pace to absurdism.

  4. BlackRockTheLaughingStockOfTheWorld on Fri, 10th Jun 2022 9:10 pm 

    I told you, we live in a reality that make fun of itself and the financial sector. BlackRock is now the comedy hour of earth. Look at the white glasses, this is what you will in a reality making fun of itself and moving toward absurdism at breaking speed.

    https://www.youtube.com/watch?v=-ZaBgKWCq7I

  5. GODHateBlackRock on Fri, 10th Jun 2022 9:17 pm 

    I think GOD’s hate BlackRock. what do you think.

    Is she a witch.

    https://www.youtube.com/watch?v=CP4LXQE7_fQ

  6. Cloggie on Sat, 11th Jun 2022 1:57 am 

    We are going down the shitter with the US, because the ruling political left refuses to break with the US. Let’s see how long that lasts. We are ruining our economy because we support the latest US imperial project, Ukraine, which of course is going to fail, like every other US imperial project.

    So you are still pushing against green power, although you said you have solar panels yourself? How smart is that? Oil and gas are running out. Your advise: abandone green projects as well.

    Uhuh.

    You say that 1:1 conversion from ice to electric won’t happen. Perhaps, but so what. Covid has shown that societies can soldier on without mass commuting. A high energy highway can be replaced by a low energy glass fiber cable.

    I wouldn’t mind if private car ownership for the masses disappears and will be replaced by (semi)-autonomous driving in van transporters. That could happen quickly once the congested roads will be cleared, like in 1973, when the US and Holland were targeted by an Arab oil boycott.

  7. Ted Wilson on Sat, 11th Jun 2022 10:20 am 

    When long time gas price record of $4.11/gallon set in 2008-07 was broken on 2022-03-09 with $4.252, people felt some pain, but it did not stop there, slowly it increased further and hit $5.004 / gallon with diesel setting its own new record of $5.765 / gallon.

    Please go buy/trade in for a hybrid, plugin or electric vehicle. If you continue to use your vehicle, at least fill it with E15, E30 like fuel which is reduce the oil consumption.

  8. Ted Wilson on Sat, 11th Jun 2022 10:28 am 

    Oil production hit a peak in 2018 and is declining since then including in 2021 despite recovery from covid, even shale oil is sputtering.
    Beware guys, get ready to get fuel efficient vehicle instead of standing in gas line. Its the oils monopoly on transport that gives it so much power, time to replace oil with natgas, biofuels, electricity.

  9. Ted Wilson on Sat, 11th Jun 2022 10:42 am 

    chinese are not sleeping at the prospect of peak oil, thats why they are making electric vehicles at rapid speed and last month they sold 447,000 plugin vehicles (BEV: 347,000; PHEV: 100,000). This is 24% (nearly 1/4) of total vehicles sold.

    sadly americans are believing in shale oil as their savior which has 50% depletion rate.

  10. KillVangaurdAndBlackRockCEOs on Sat, 11th Jun 2022 2:00 pm 

    Let’s talk about Vanguard and BlackRock. Vanguard has 5 trillion of assets and BlackRock has 6 trillions of assets. Both mutual funds companies cannot sell their asset without crashing the world wide economy. The cannot sell their assets and move into a cash position because it will crash the prices of the assets they own. They are lock down and cannot take any actions other the saying to people to not sell their mutual fund.

    They don’t have enough cash in hands to convert redemptions, if people were to decide to sell in masses.

    https://www.vanguard.ca/api/document/16815/CA

    Loot at this mutual fund. They have 1% cash at hand. If they don’t have enough cash at hands to covert a massive sell of their mutual found by people, they will need to sell some asset that will drive the market down.

    This is why it is easier to kill everyone on earth and restart from zero. Better to have a creation with high quality people instead of big creation with 100% of stupid people.

  11. ParasitesEverywhere on Sat, 11th Jun 2022 2:07 pm 

    Just to explain how much parasite is feeding off the hard working people like car mechanics, welder, bus driver, let’s look at this mutual fund of Vanguard.

    https://www.vanguard.ca/api/document/16815/CA

    Three financial institution are managing people money:

    schorder investement
    Bahillie giffor
    vanguadd

    You have there financial companies take a pource of people money to managye their money.

    These are the three parasites attached to this mutual find VIC400:

    https://www.vanguard.ca/en/advisor/products/products-group/mutual-funds/VIC400

    You have 3 parasites attached to VIC400 mutual funds. This is why productive people , like me, are not interested to contribute anything to western civilization. We prefer to see it burn to the ground even if it will kill us.

  12. ParasitesEverywhere on Sat, 11th Jun 2022 2:09 pm 

    These are the names of the 3 parasites attached to the mutual fund VIC400

    Baillie Gifford Overseas Ltd.

    Schroder Investment Management North America Inc.

    Vanguard Global Advisers, LLC

    See comment above.

    You cannot fix such a mess, this is why GOD is telling me, we kill everyone and restart from zero.

  13. AnotherNotificationOfDeadForTheJewishPeopleIcComing on Sat, 11th Jun 2022 3:31 pm 

    I will send soon another notification of dead b y facial skin cancer to all the Jewish people. I will send my notification directly Bennett email address.t

  14. WeAreBothWorkdingTowardJewishExtinction on Sat, 11th Jun 2022 3:38 pm 

    GOD and I are working together in torturing all the Jewish people to death. GOD is working at cutting the water supply and I am working at giving a painful death by bloody facial skin cancer.

    https://www.youtube.com/watch?v=KYhZwcwtN4k

  15. JewishNoticeOfExecution on Sat, 11th Jun 2022 4:05 pm 

    I send the following notification of death for all the Jewish people at the following email address [email protected]

    From the Son of GOD and GOD himself.

    All Jewish people have been judged and sentence to death by bloody deadly facial skin cancer. The water supply of Israel will also be cut by GOD, by increasing the temperature over Israel nation.

    The Jewish people are guilty of the Bolshevik revolution and the creation of the holocausts to put themselves as perpetual victim of the White human angelic race. They are guild of systemic hatred toward Whites angelic race. Whites people are GOD proudest achievement and He will no tolerate anymore hatred toward them.

    This message will be posted on peakoil.com. I send a similar message to the following organizations:

    So far I send three notification of death to the following

    1- https://tcfcanada.org/about-us/#

    2- https://www.centuryinitiative.ca/

    3- https://www.hill-international.com/en-EU/

    4- All the Jewish people. Natali Bennett is responsible to inform them of the death sentence by facial skin cancer.

    5- Goldman Sachs

    6- Vatican Pope, bishops, cardinals, priests

    7- British Royal Familly

    This judgement is final and will be carried by GOD himself.

    See what someone dying of facial skin cancer look like: Fauci dying of facial skin cancer

    https://www.youtube.com/watch?v=NiZs_72DmMo

    Prince charles suffering of deadly facial skin cancer 1:02

    https://www.youtube.com/watch?v=Y6qXnXZQabw

  16. AcceleratedEntropicDecay on Sat, 11th Jun 2022 4:16 pm 

    It also my believe that GOD has accelerated the entropy decay of the whole planet earth by modifying the sun configuration. The entropic decay has been accelerate and think will fall apart much more quietly now then 10 years ago.

    Everything is set up to kill all the population of earth, except a few selected people.

  17. makati1 on Sat, 11th Jun 2022 5:18 pm 

    Yes Cloggie, the EU is going down. It will not be allowed to become independent of the US. Your countries are still US occupied ever since WW2, as is Japan and South Korea. Not going to change.

    What happens to countries that try to break away? Think: Libya, Iran, Venezuela, Cuba, etc. The EU is a necessary market for US crappy, over priced weapons and to supply cannon fodder so Americans don’t have to pay the price of their wars. Think: Ukraine.

    Mass commuting is not a problem in a country no bigger than a postage stamp, but it would get lost in Texas. When you live 20 miles from a store, you need transportation. That is about half of the US. My sister lives in a crowded state but the nearest store is still 8 miles away.

    I agree that oil should be $1,000/bbl to make people conserve, but that will not happen either. At least not for a long while. Diesel runs the world. YOU would starve without it. NO? Think about that while you eat dinner and ask how it got on your plate? How it was grown, harvested, shipped, etc. Diesel. NOT electric.

    Sure we have solar panel security lights. Solar has some practical uses, but not scalable to replace even a small fraction of what is needed. Here, we don’t have to worry about snow covering them or long periods of clouds. For less than $100 we have 5 solar lights covering our yard. Our electric costs about 25 Euros per KWh so they have already paid for themselves.

    The Western economy is going down. Welcome to the Third World.

  18. makati1 on Sat, 11th Jun 2022 5:52 pm 

    “Prices at the pump in the Netherlands have soared to record highs, driven by the growing cost of oil, according to data by Dutch consumer group United Consumers.

    The retail price for a liter of gasoline is currently at €2.50, data showed. It was reaching €2.505 per liter at the pump. The cost of gasoline rose by 0.2 cents per liter, compared with that recorded on March 10. The price of diesel has also increased, to €2.22 per liter on average.

    Higher fuel prices have been attributed to the rising price of oil, with Brent crude hitting $122 a barrel on Friday.

    Experts say the EU’s decision to halt all imports of Russian oil by the end of 2022 will have a significant impact on how much Dutch drivers will pay at the pump. Gasoline prices are likely to rise further over the coming months, analysts predict.

    The rising prices of oil, gas and electricity have affected companies and customers across Europe. Annual inflation in the Netherlands in May was 10.2%, compared to 11.2% a month earlier, according to Statistics Netherlands (CBS). Inflation remains high, driven by increased energy and food prices.”

    Welcome to the 3rd world, Cloggie: https://www.rt.com/business/556805-gasoline-prices-soar-netherlands/

  19. ExecutionByFacialSkinCancer on Sat, 11th Jun 2022 5:54 pm 

    The numbers of people with red faces I see on youtube video does not stop to surprise me. It is getting more and more obvious that a big part of the population will die with a bloody deadly red facial skin cancer. I have so many example. This is just one example: 20:34

    https://www.youtube.com/watch?v=2ItF7uZgRWI

    I have so many videos. I expect now that all the Jews will be executed by deadly bloody facial skin cancer.

    The license plate said to my NOMURCY or if you want no mercy. So I am doing what GOD wants me to do.

  20. ExecutionByFacialSkinCancer on Sat, 11th Jun 2022 5:58 pm 

    I have red faces everywhere on my youtube page. One more as a last example:

    https://www.youtube.com/watch?v=bLFw2Tb2x88

  21. makati1 on Sat, 11th Jun 2022 6:02 pm 

    BTW Cloggie, Philippine gasoline is only P85/L which, at today’s conversion, is about 1.52 Euros, or about 40% cheaper than the 2.50 Euros in the article. Hmm.

  22. FamousDrScanlon on Sun, 12th Jun 2022 1:35 am 

    I was wondering what it’s like for the Jew haters waking up everyday angry & envious, decade after decade?

    I bet the hate & anger helps attract the ladies eh?

    I guess it’s not as bad as it used to be for you now that they have better sex toys like every Jew haters favorite – the vibrating boy pussy. Apparently it vibrates in German.

  23. Biden’s hairplug on Sun, 12th Jun 2022 3:27 am 

    Yeah makati, there is little future for fossil fuel products in Europe. Fossil fuel, the icon of the American Era and the single most important reason why the American Century came about (plus kosher scheming and war mongering, but oil enabled the US empire, just like coal and steam enabled the British and windmills the Dutch empire).

    https://www.amazon.com/End-American-Era-Geopolitics-Twenty-first-ebook/dp/B000XUDGTY/ref=sr_1_1

    “The End of the American Era: U.S. Foreign Policy and the Geopolitics of the Twenty-first Century“

    Kupchan is a smart jew, he recognizes a winner when he sees one. In his view, Europe, not China, will replace the self-styled US hegemon.

    The kosher media begin to admit that Russia is winning the war:

    https://www.newsweek.com/ukraine-risks-losing-artillery-war-russia-vadym-skibitsky-military-intelligence-1714782

    Let’s hope that Zelensky, Henry Ford’s “world’s foremost problem”, gets toppled by some Ukrainian general soon, who then strikes a deal with Putin and ends the war.

  24. peakyeast on Mon, 13th Jun 2022 5:21 am 

    Well. I live in Europe. If I switched to electric from my diesel car I would be paying far more.

    Electricity prices has risen dramatically.

  25. Cloggie on Mon, 13th Jun 2022 7:41 am 

    “Electricity prices has risen dramatically.”

    They have, because oil and gas prices have risen dramatically, the prices of wind turbines and solar panels not so much:

    https://etronixcenter.com/nl/solar-panels/8173105-s-jam60s20-380-mr-jasolar-380w-mono-mbb-perc-half-cell-black-frame-mc4-zonnepaneel.html

    Now is the time to install as many solar panels as possible.

  26. makati1 on Tue, 14th Jun 2022 5:20 pm 

    You are wasting your time pushing “renewables” Cloggie. without government (TAX) money, they would not be “profitable”. If they do not show a reasonable profit, they will not exist. Without a mega country sized way to save the electric they occasionally generate, they are just a green wet dream. Not going to happen.

    Besides, they will never power the other 80% of energy needs that only FFs can provide. Mining, trucking, shipping, glass, steel aluminum, farming, etc. When seasonally priced oil finally ends, so does modern civilization.

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