Peak oil is just one of five things to keep you up tonight
It's not uncommon for us to do a little bit of forward thinking and try to predict how gas prices will rise or fall in the near future. We've thought about how a successful Tata Nano could raise prices for everyone and wondered - with 72 percent of Americans - just what we'll do if $4 gallons of gas make their arrival this summer. There's even a game based on the idea that we're running out of gas over at World Without Oil (current price there is $5.59/gallon). The bigger picture, though, is the concept of peak oil, a situation that a lot of smart people think we're already in. Our friends at Green Daily are taking a look at the end of oil as part of their "End of the World Files." Most entertaining line: peak oil "could have Mad Max-like implications for industrial society." We can put a few numbers on this by looking at Autoblog, which talks about an Energy Watch Group study that finds that in 2030, oil companies will be producing half as much oil as they do today. For their part, the oil companies say we can keep pumping as much as we are today for the next 42 years or so.
If the oil crunch isn't enough to worry you, Green Daily also has End of the World files on climate change, pandemics, rocks from space and the singularity. Good times?
[Source: Green Daily]
Reader Comments (Page 1 of 1)
meme 5:43PM (2/13/2008)
My take on the whole "Peak Oil" thing:
http://www.daughtersoftiresias.org/greenwiki/Peak_oil
In summary:
* Random price spikes: Yes
* Unbearably high or civilization-destroying prices: No
* Environment if we don't transition off oil: In trouble
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harlanx6 11:50PM (2/13/2008)
People or oganizations trying to scare you to death are ALWAYS benefiting financially from it in one way or another, ALWAYS!!!! Either they are selling something eg a book or technology, soliciting donations or dues, government grants, etc. YOU CAN COUNT ON IT EVERY TIME!!!!!
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Tim 8:56AM (2/14/2008)
"The sky is falling, the sky is falling, we NEED global socialist government controlled by giant corporations, international bankers and elite socialist bureaucrats code named "New World Order" to save us! After all, we ARE smarter than you."
This message sponsored by:
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Lou Grinzo 9:46AM (2/14/2008)
Speaking of "the oil crunch"--that's the title of my most recent presentation on peak oil, an intro for newcomers. Feel free to download it, send it to others, etc.
http://www.grinzo.com/energy/downloads/theoilcrunch09x20x2007.pdf
I almost forgot. Tim: BOO!!!
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meme 12:35PM (2/14/2008)
Lou Grinzo:
Fundamental flaw in your paper on page 10:
"Another problem is that the expensive oil usually can't be extracted and turned into useful products as quickly as the cheap oil"
For a given amount of capital investment. It has higher capital costs and marginal costs, which is why it is more expensive. Invest more capital and you get it faster. Have you not payed attention to how fast production is growing in Alberta?
A couple other points (which were made in my reference):
* When prices rise, *exponentially* more oil comes online, not linearly more. Check out our coal reserves, or shale for that matter. Every tech has its price point.
* Technology advances make prices fall. You can't schedule innovation, but betting against all tech improvements is a really bad bet. The further tech advances, the lower the price point for a given resource.
Consequently, you have two forces leading to a flattening in prices as light, sweet crude deposits run low: advancing technology and exponentially more reserves coming online.
Your talk of "production peaks" on page 7 ignores the fact that oil production doesn't work that way. Check out Canada's production graph, for example (you can see it on my page). You list Canada as a country that peaked on page 13, but that's not the case, if you'll consult a production graph. It shows what happens as rising prices meet advancing tech. Canada peaked in the 70s, declined, and now has gone back up and surpassed it's earlier peak, and is on track to peak at 2-3 times as much production as its earlier peak.
Your "yearly discoveries" graph on page 11 terminates conveniently before two major deep sea finds in the Gulf, a huge find in Iran, and before all of the new Arctic exploration that's going on can report back. And it only discusses light crude, not syncrude, which is destined to be an increasing part of our consumption.
On pages 15-16, you state a major fallacy -- that run-ups in price in the short term have any relevance to the scale of world oil production potential. New oilfields and syncrude plants take 5-10 years to get online. On scales shorter than that, you're looking at general demand miscalculations, the US filling its strategic reserves, demand unpredictability (such as a very cold winter or whatnot), natural disasters, instability in producing nations, war, and other "shorter term" price spikes.
On page 20, you note Hubbert's 1956 prediction, and fail to observe that A) he had the only remotely accurate prediction out of people saying "peak oil" since oil was first discovered, B) his prediction was way off on the downslope, and his natural gas prediction even moreso. In fact, the only Hubbert curve that worked out remotely accurately in the US was anthracite coal, and that not because of a lack of supply, but simply because people stopped heating their homes with coal.
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