"Whatever happened to the initiative in the US congress to increase tax on this?"

The politicians decided they liked being in office more than they want to save the planet. Or perhaps they realized raising taxes when unemployment is heading towards 10% is not a good idea.

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The last gas tax increase in the U.S. was a 5 cents per gallaon in crease in 1993 by Bill Clinton.

That increase was repealed a year later when Newt Gingrich and the Republican Congress took over with their "contract on America".

Since then we have fought two wars protecting oil and tripled the U.S. debt without raising gas taxes even one penny....

It's time the "U.S. government" stopped subsidizing oil and raised gas taxes to pay for the miltary expense of protecting foreign oil.....

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Dave, you think we went to Afghanistan for oil? Is Sept, 11 2001 that far in the past?

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Dave, you think we went to Afghanistan for oil? Is Sept, 11 2001 that far in the past?

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"The last gas tax increase in the U.S. was a 5 cents per gallaon in crease in 1993 by Bill Clinton. "

Really? Wow. In the UK they increase fuel duty by a few pence every single year.

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Between about 2004 and 2008, the price of gas in America doubled. Demand fell by about 7%. That's not what I would call a highly elastic (responsive) demand function. Are you looking at some more conclusive data?

Also, I'm confused by your conflation of 'peak oil theory' and anarchism, as I am by the assertion that a drop in demand would 'kill' the theory. Could you explain what 'peak oil theory' means to you, and how it is reliant on any particular political ideology?

The theory, as I understand it, relies on pretty basic logic:
Do you disagree with any of the following statements?
a) There is a finite amount of petroleum in the earth.
b) We are consuming petroleum today faster than it is being generated.
c) If we continue to consume it faster than it is generated, we will eventually run out.
d) As we consume the easily accessible stuff, extraction will become more difficult and expensive.
d) As the price rises, it is reasonable to expect a period in the future where extraction is lower than it is today, but greater than zero (and still greater than the rate of generation).
e) The curve of annual extraction will thus have a peak (a point of maximum annual world petroleum extraction).

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The thing with peak oil is that it's the peak of extraction, per day for example. You always hear people going 'but there's 100 years of oil left'. There's a lot of oil left indeed, but yes it's harder to extract at the rate that is demanded, e.g millions of barrels per day. The good news is that flow rates don't seem to follow a bell curve, that is a field can reach a peak extraction rate but then doesn't tail off as quickly as the extraction rate increased.

Also there are very good indications that electrification of the personal transport fleet can reduce (or at least keep level) world wide demand for crude oil. There are plenty of naysayers but I don't see what choice we really have, although I suppose reduced consumption due to less economic activity, or activity that requires less crude, is helping not that I'm calling the recession 'a good thing'.

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"Do you disagree with any of the following statements?
a) There is a finite amount of petroleum in the earth."

Disagree, for all practical purposes. Oil can be produced from virtually any source of carbon and hydrogen. It's all about the price of said production. It's $5 per barrel or less from optimal sources, like in a lot of the middle east. It's $15-$35 from tar sands. It's $25-$45 from shale (but only in bulk). It's a little cheaper from coal. It's about $50 from the Bakken and Greenland. And it's about $70 from biomass. For even more it can be produced straight from air, water, and electricity. Now, these are the base production cost. On top of it you have to add shipping, refining costs, and profit. And the more risky the venture, the more profit you have to have on top of it to justify it. And you need forecasts to say prices will be *sustained* at or above your required value, since such a venture lasts for decades.

"b) We are consuming petroleum today faster than it is being generated."

We are consuming petroleum at approximately the same rate we are generating it.

You are acting like conventional crude is the only kind of crude out there, when the reality is that every time you fill your tank up, what's in it comes from a slightly larger percentage of syncrude than the last time you filled it up.

"c) If we continue to consume it faster than it is generated, we will eventually run out."

Which is why we will just produce more syncrude.

"d) As we consume the easily accessible stuff, extraction will become more difficult and expensive."

True. See prices above. They're not world-ending. And you left out a critical element: that as tech advances, prices drop. These two factors are constantly in battle with each other, but the scaling factors favor technological advancement. That is because the highest quality deposits of any resource tend to be an order of magnitude rarer than the next most common. Hence, doubling in price *or* halving extraction costs via tech improvement doesn't double reserves -- it increases them by an order of magnitude or so.

Betting against technology, BTW, is a bad bet. See the Simon-Ehrlich Wager. Or, perhaps more appropos, compare extraction costs for bitumen from the late 1970s ($70-$100/barrel) to today's ($15-$35/barrel). Or look at the massive Bakken reserves which were basically laughed off as completely unrecoverable until the advent of horizontal drilling.

"d) As the price rises, it is reasonable to expect a period in the future where extraction is lower than it is today, but greater than zero (and still greater than the rate of generation). "e) The curve of annual extraction will thus have a peak (a point of maximum annual world petroleum extraction)."

A demand peak will do that. And that's what I want to see happen.

Don't get me wrong -- our increasing demand for oil, and its increasing shift from being nearly entirely an energy source toward being an energy sink, is absolutely *not* a good thing. The environment will be screwed if we keep this up. But the key is to note that it's the *environment* that's screwed, not the world economy (that is, unless we screw up the environment enough that *that* hurts the economy)

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Anonymous

You make some good points. One thing I will clarify in my previous comment was that by "generation" of petroleum (in b) , I meant that rate at which it is being generated by biogeochemical processes in the earth, not the rate at which it is being extracted.

I would also argue that generation of fuel "straight from air, water, and electricity", or even from biological feedstocks hasten, rather than circumvent, 'peak oil' as I (and I think the majority of people who talk about it) mean it, in the sense of there being a point of maximum geological extraction.

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