Drumbeat: May 13, 2011

Gulf states seek high-tech oil boost

RIYADH, Saudi Arabia (UPI) -- Persian Gulf oil producers are turning to advanced technology as fields become depleted and extracting the crude becomes more difficult while global demand grows.

Energy industry analysts see a major surge in demand for oil that, even if there are no serious disruptions in supply in the Middle East because of the current political upheavals sweeping the region, will challenge the current supply base to the limit.

Subsidies give Saudis an appetite for oil

In the desert outside Riyadh, young Saudis spend entire nights drag racing. There are few other options for entertainment in the kingdom and such car races are an economical way of letting off steam.

Thanks to government subsidies, petrol costs only 12 cents a litre in Saudi Arabia, making it cheaper than bottled water.

The same subsidy system also holds down the prices of drinking water and electricity consumption in a country where almost all buildings are air-conditioned.

At least 1 dead as Syria regime changes tactics against protesters

BEIRUT — Syrian security forces opened fire on thousands of protesters Friday, killing at least one person with a gunshot to the head as soldiers tried to blunt demonstrations by occupying mosques and blocking public squares, activists said.

The death in the central city of Homs marks the latest bloodshed in what has become a weekly rhythm during the two-month uprising, with protesters taking to the streets every Friday, only to be met with bullets, tear gas and batons.

China suspends export of diesel fuel amid shortage

China's economic planning agency says it is suspending exports of diesel fuel to help counter shortages likely to worsen during the peak summer months, as the country endures widespread power shortages.

Heinberg: Will Natural Gas Fuel America in the 21st Century? - Foreword to new report

A detailed new energy report argues that the natural gas industry has propagated dangerously false claims about natural gas production supply, cost and environmental impact. The report, "Will Natural Gas Fuel America in the 21st Century" is authored by leading geoscientist and Post Carbon Institute Fellow J. David Hughes.

EPA Pressures Pa. to Tighten Wastewater Disposal Standards

The U.S. Environmental Protection Agency on Thursday stepped up pressure on Pennsylvania regulators to tighten wastewater disposal standards for natural gas drillers, a federal assertion of authority that rubbed the Marcellus Shale industry the wrong way.

The EPA directed the six biggest Marcellus Shale natural gas operators to disclose how and where they recycle or dispose of drilling wastewater in the region. Those companies have promised to abide by a call from Pennsylvania's top environmental regulator to stop sending their wastewater to 15 treatment plants by Thursday.

Pensacola Beach recovering 1 year after spill

PENSACOLA BEACH, Fla. — Pensacola Beach's famously white sands — coated in thick crude last year after the nation's worst offshore oil spill — are back to their original color, and tourist arrivals outnumber what they were before BP's blown-out well spewed 172 million gallons of oil into the Gulf of Mexico.

Hotels and restaurants that sat largely abandoned at the height of the spill are reporting a 50 percent increase this spring compared to the same time last year before the disaster.

Missed Opportunity: Transit and Jobs in Metropolitan America

Nearly 70 percent of large metropolitan residents live in neighborhoods with access to transit service of some kind. Transit coverage is highest in Western metro areas such as Honolulu and Los Angeles, and lowest in Southern metro areas such as Chattanooga and Greenville. Regardless of region, residents of cities and lower-income neighborhoods have better access to transit than residents of suburbs and middle/higher-income neighborhoods.

In neighborhoods covered by transit, morning rush hour service occurs about once every 10 minutes for the typical metropolitan commuter. In less than one quarter of large metro areas (23), however, is this typical service frequency, or “headway,” under 10 minutes. These include very large metro areas such as New York, Los Angeles, Houston, and Washington. Transit services city residents on average almost twice as frequently as suburban residents.

Area carpool lots overflowing

Since the energy crisis of the ‘70s, motorists have been seeking ways of cutting down on transportation costs. Early on, creative motorists parked alongside roads, on private property or in commercial parking lots, which created safety concerns. These circumstances are what prompted the establishment of organized carpool lots in 1974.

John Michael Greer: Hair Shirts, Hypocrisy, and Wilkins Micawber

I field emails and comments a couple of times a week from people who are seriously troubled about the future. They see themselves as trapped in a system that’s already started to go to bits around them, and lacking the money and other resources that would be needed to make the preparations they’d have to make to weather the approaching crash. A good many of them are living in apartments with nowhere to garden and few options for energy retrofits, and they quite reasonably worry about what’s going to happen when access to energy becomes intermittent, food prices spike, and what now counts as a comfortable urban lifestyle begins the long downhill skid into the shantytown existence facing something like half of the American people within a few decades. They want to know what options I can suggest for them.

The core strategy for people in this position? Use much less, so that expenditures drop well below income, freeing up money to be used to get out of the current, unsustainable situation.

Surviving the Apocalypse in the Suburbs

What if you had three weeks to prepare for a life-changing disaster? A severe ice storm, earthquake, flood, or something similar? Wendy Brown says that preparing for disaster leaves us better equipped for the changes that are happening right now. Carl Etnier interviews Brown about her book, Surviving the Apocalypse in the Suburbs: The thrivalist's guide to life without oil.

Saudi Arabia under siege

We expats wonder, what in the world are we doing here? We fantasize that we’re promoting the transition from a medieval theocratic dictatorship into something that can work in a modern world. But that would amount to a revolution, and Saudis are way too sharp to upend things. Why derail a gravy train, especially when, as Saudis will explain, it was Allah who put this oil beneath these sands?

As oil prices drop, Fed should get credit

Since the financial Panic of 2008, the Federal Reserve’s easy-money policy has been widely blamed for a global run-up in commodity prices — especially oil. Now that oil prices appear to have peaked and are coming back down, it’s time to give the Fed some credit.

After flooding the financial system with cash for more than two years in an effort to stabilize financial markets and economy, the Fed is getting ready to turn off the taps. The anticipation is one reason oil prices are coming back down, according to oil market watchers like Peter Beutel, president of Cameron Hanover.

“The major factor in this market — through riots in the Middle East, floods along the Mississippi, the lack of new offshore drilling or a national energy plan, slow employment gains and a housing market in the dumps, through gains in gasoline stocks or declines in consumption — is the U.S. dollar,” he said. “And that is determined by actions taken by the Fed.”

Mississippi-River Flooding Threatens Louisiana Oil, Natural-Gas Production

The rising floodwaters of the Mississippi River, threatening towns and farms between Memphis and the Gulf of Mexico, may affect 10 percent of Louisiana’s onshore crude oil production.

A total of 2,264 oil wells are responsible for about 19,000 barrels of crude a day, said Matt Ross, communications director for the Louisiana Oil and Gas Association. He said 150 companies are preparing for flooding in a four-parish area in the southern part of the state.

Russia may boost oil export duty if gasoline shortages last

Russia, the world's largest oil producer, may raise export duties on raw materials for gasoline production, if local fuel shortages persist, Energy Minister Sergei Shmatko said on Friday.

"It may be related to vacuum gas oil and straight run gasoline - the raw material used to produce high-grade petrol. It is exported a lot, and its export is profitable. We do not rule out raising export duties on this kind of raw material," Shmatko said.

Petronas to Build $20 Billion Malaysia Oil, Chemical Hub Next to Singapore

Petroliam Nasional Bhd., Malaysia’s state oil and gas company, will build a $20 billion refining complex bordering Singapore to benefit from increased global demand for petrochemicals and plastics.

Power outage hits biggest Venezuelan refineries

CARACAS, Venezuela - A power outage has interrupted operations at Venezuela's largest oil refinery complex.

The state oil company Petroleos de Venezuela SA says some units of the Cardon and Amuay refineries in western Venezuela were temporarily halted by the outage.

Enbridge: Replacing 75 miles of Ind., Mich. pipe

MARSHALL, Mich. - Enbridge Inc. plans to spend $286 million to replace 75 miles of pipeline in Indiana and Michigan after a 2010 break that spilled at least 800,000 gallons of oil into the Kalamazoo River system, the Houston-based company announced Thursday.

Total makes Poland shale gas move

Supermajors Total and ExxonMobil have hatched an agreement to divide up a couple of shale gas plays in Poland but are keeping mum on key details.

Fossil fuels: what's not to love!

A controllable source of energy that has only two major downsides — finite supply and being the source of the CO2 that's driving climate change — what's not to love all right!

Thar She Blows: Whale Age Teaches Us about Oil

Ugo Bardi, an Italian chemist, says the history of the whaling industry really teaches us two things about peak oil or the end of cheap petroleum. As sperm whales got dearer, candle buyers experienced strong price oscillations and greater instability in the marketplace. Depletion happened without a reliable or cheaper technology on the shelf.

At the end of his rumination on Moby Dick, Wagner asks a rude question. It's one that Melville posed in a later novel: do we want to become "the graceless Anglo-Saxons, who, in the name of Trade, deflower the World's last sylvan glade?"

How Lombard Odier is tackling the commodity slump

Does this mean we are at peak oil? Not at all: it simply means that resources are harder to find and develop than they were, often in more technically challenging areas (such as the Brazilian deepwater) or in countries that are harder to do business with. There is still plenty of oil out there, it is just more of a challenge to find and develop it, and that may effectively curb the ability of global oil production to grow. Hence those companies that can source new reservoirs of oil and gas stand to benefit greatly from this.

This provides a strong support for oil prices up to $90-$100 a barrel as this represents the marginal cost of replacing the most expensive barrels of global oil production. As a result we feel comfortable investing in those businesses that discount lower prices than this in their valuation.

Two hard-asset letters still confident

Despite his overall imminent-shortages-in-everything thesis, King writes: “We’re at a point where it’s safe to say that there may indeed be a few more Saudi Arabia-equivalents of oil out there, offshore.”

He adds: “It’s good news, although the fact of ‘more oil’ just changes the shape and timing of the eventual Peak Oil curve. The world still needs to evolve its energy systems towards efficiency, conservation and acceptable pricing, while understanding the significance of the tiny — truly tiny — amount of global energy supply that can or will soon come from alternative sources.”

Many industries reap tax breaks. Is picking on Big Oil unfair?

The oil industry, under fire from congressional Democrats for reaping big tax breaks even while amassing huge profits, responds with a simple argument: Don't pick on us.

Why This Man and His Team Are the Greenest in Rochester

For John Batdorf, this weekend's Green Living Festival all started with peak oil.

It was six years ago, and Batdorf was in his mid-40s, living in Grand Blanc and semiretired from his position as CEO of his own software and computer systems company.

He remembers reading an article in Rolling Stone magazine about the inevitability of a time when there isn't enough oil to go around.

Taking bold energy steps

Despite peak oil, it still remains the cheapest option to generate energy per kilowatt than any other source when all costs are factored in. One reason for this is that the technology has been around for more than a century and has been continually refined with a system of distribution perfected over this period of time, unlike any other source of energy.

But the fact remains that oil is a non renewable source and will eventually run out. The answer to the question “when?” is hotly debated but there is no denying that it is a finite source that is highly polluting and will continue to take a heavy toll on the world’s environment as it runs out.

To Live or Not to Live

HAVE YOU EVER NOTICED how many excuses we all find to not act in defense of the planet? Sure, we all have errands to run and e-mails to answer and we all need down time and the problems are so big and [INSERT YOUR BEST EXCUSE HERE]. But lately I’ve been encountering a particularly frustrating excuse that a lot of people seem to be giving for not acting: they say it’s too late, that various tipping points have been reached in terms of runaway global warming, and that especially because of the lag time between carbon emissions and increased temperature, we’re already doomed, so what’s the point of fighting back?

Future Babble

Much of this book is based on the research of psychologist Philip Tetlock, who examined thousands of predictions from hundreds of experts (political scientists, economists, journalists) in order to determine their accuracy. Through his study, Gardner tells us, Tetlock discovered “the simple and disturbing truth is that the experts’ predictions were no more accurate than random guesses.” However, he did find what he believes to be a factor determining which experts were able to make more accurate predictions than others. Those experts that he termed “hedgehogs,” people who seem solely concerned with looking at things in terms of one big idea, were far more likely to make inaccurate predictions. On the other hand, “foxes” are more analytical and not as confident as hedgehogs, yet are more often able to make accurate predictions.

The author uses this framework of hedgehogs vs. foxes as he examines a myriad of examples of predictions from the recent past. As Gardner states, it is the hedgehogs that tend to dominate the media when it comes to discussing the future. Tune into any political talk show and you will very likely find some expert or another brashly predicting some cataclysmic change on the horizon based on a theory about one big idea (i.e. climate change, terrorism, overpopulation, peak oil, the list goes on and on). This is not necessarily a new phenomenon. Since the dawn of modern science, people have tried to use scientific methods to ascertain what the future holds. Yet history has proved time and again that people, not to mention the environments surrounding us, are full of surprises.

One-third of global food production goes to waste: FAO

The FAO found that about 1.3bn tonnes of food is wasted somewhere along the supply chain each year, with wealthier consumers in North America and Europe wasting nearly twice as much as those in poorer countries. Consumers in richer countries throw away about 222m tonnes of food each year, most of it fruit and vegetables, and nearly as much as the entire net food production of sub-Saharan Africa, at 230m tonnes.

However, industrialized and developing countries tend to waste about the same amount of food on an absolute basis, the report found – 670m tonnes a year and 630m tonnes a year respectively. While most food wastage in richer nations occurs on a consumer level, in developing countries about 40 percent of wastage happens at the post-harvest or processing level due to poor infrastructure and lack of investment in food production systems – a problem the report terms ‘food loss’.

Why Sustainability Reporting Is Revolutionary

Five years ago, we worked with a number of key stakeholders to scenario plan for the volatile and resource constrained world we saw emerging. We identified key indicators of stress that would force change upon economies and businesses: Peak oil and rising gas prices. The number of weather disruptions that then led to droughts or floods impacting commodity prices. Growing inequity between rich and poor. Breakdowns in global governance mechanisms. Greater transparency and access to information as an accelerator of change.

Today all those indicators are flashing amber. And because of that, we collectively must create a new pace and scale of change. One that is measured against a ticking clock that counts in days, not decades.

Challenges of a Colorado Local Food Initiative

Building up Boulder County’s local food system – increasing the capacity for food to be grown, processed, distributed and sold within the county – is a goal of Boulder-based nonprofit organization Transition Colorado. The organization’s outlook is informed by the global Transition movement, a grassroots effort tied to the Transition Network in the United Kingdom and focused on strengthening communities dealing with what Michael Brownlee, cofounder of Transition Colorado, refers to as a “convergence of global crises.”

NFU wants South Frontenac livestock bylaw revisited

"Local 316 has been active over the past decade in building the local food system in Frontenac and Lennox & Addington Counties, in the City of Kingston and beyond," she said. "Given the likely circumstances of the future peak oil, climate change, uncertain global and political conditions and food shortages we believe that every community needs to protect the food security of its citizens by increasing the community's ability to grow and process its own food.

"Permitting the residents of South Frontenac Township to keep limited numbers of livestock, particularly small livestock, on properties under three acres in size, will increase the community's food production capacity, by building its knowledge, skill and experience."

Coal Curriculum Called Unfit for 4th Graders

Three advocacy groups have started a letter-writing campaign asking Scholastic Inc. to stop distributing the fourth-grade curriculum materials that the American Coal Foundation paid the company to develop.

The three groups — Rethinking Schools, the Campaign for a Commercial-Free Childhood and Friends of the Earth — say that Scholastic’s “United States of Energy” package gives children a one-sided view of coal, failing to mention its negative effects on the environment and human health.

In a Green Town, Activists See Red Over Lockheed Martin

BURLINGTON, Vt. — Car sharing is beloved in this laid-back college town, as are solar panels, rain gardens and most anything designed to fight global warming from the ground up. A bicycle service will pick up your kitchen scraps for composting, and farmers will deliver your vegetables in a biodiesel-fueled truck.

Pride in these homegrown efforts runs deep, and so some Burlingtonians were livid when Mayor Bob Kiss announced a partnership late last year with Lockheed Martin, the military contractor, to work on clean-energy projects.

In a Changing Antarctica, Some Penguins Thrive as Others Suffer

In the past three decades, the Adélie population on the peninsula, northeast of the Ross Sea, has fallen by almost 90 percent. The peninsula’s only emperor colony is now extinct. The mean winter air temperature of the Western Antarctic Peninsula, one of the most rapidly warming areas on the planet, has risen 10.8 degrees Fahrenheit in the past half-century, delivering more snowfall that buries the rocks the Adélie penguins return to each spring to nest — and favoring penguins that can survive without ice and breed later, like gentoos, whose numbers have surged by 14,000 percent.

Global resource consumption to triple by 2050: UN

UNITED NATIONS — Global consumption of natural resources could almost triple to 140 billion tons a year by 2050 unless nations take drastic steps, the United Nations warned Thursday.

A UN environment panel said the world cannot sustain the tearaway rate of use of minerals, ores and fossil and plant fuels. It called on governments to "decouple" economic growth from natural resource consumption.

With the world population expected to hit 9.3 billion by 2050 and developing nations becoming more prosperous, the report warned "the prospect of much higher resource consumption levels is far beyond what is likely sustainable."

Ten Billion of us in 2100 - U.N. World Population Prospects

A very lightly covered recent story was the release of the United Nations "World Population Prospects: The 2010 Revision" report in early May. This fascinating study gives us some insight into how our world will look in the future and how population distribution will change over the next 90 years.

Oil Rises a Second Day, Climbs Above $100, as European Growth Accelerates

Crude oil rose for a second day in New York after stronger-than-forecast economic growth figures for the euro zone fanned speculation that fuel demand in Europe will increase.

Futures climbed as much as 1.7 percent to more than $100 a barrel. Gross domestic product growth in the 17-nation euro region accelerated to 0.8 percent from 0.3 percent, the European Union’s statistics office said, beating the 0.6 percent median forecast in a Bloomberg survey. The Bank of Korea unexpectedly kept interest rates unchanged after two increases this year.

Wholesale prices rise due to pricier gas, food

WASHINGTON — Companies paid more for raw materials and factory goods in April, mostly because energy prices jumped for the seventh straight month.

There is plenty of life left in this Oil Age yet

According to him, you must remember the number 3,000,000,000,000 barrels when you think about oil. "One trillion we have already consumed, one trillion we know about, and we hope there's a further one trillion to find," he says. He's clearly not a fan of the "peak oil" theory.

Erdogan to Free Tankers With $12 Billion Canal

Turkish Prime Minister Recep Tayyip Erdogan’s plan to divert tankers from the Bosporus to a new canal may unclog one of the worst chokepoints for energy carriers such as A.P. Moller-Maersk A/S of Denmark and Greece’s Tsakos Energy Navigation Ltd.

Norway curbs oil reliance in revised 2011 budget

(Reuters) - Norway's government proposed a 2011 revised budget that reduces the structural deficit before oil revenues are considered to 112.9 billion Norwegian crowns ($20.43 billion) from 128.1 billion crowns seen in October.

The government said it was aiming to avoid a situation in which Norwegian interest rates rise faster than those in the euro zone so that the crown currency does not strengthen further.

Norway hits the oil jackpot

Norway’s state coffers are set for a Nkr311 billion ($56.6 billion) boost from oil revenues this year but a further expected production drop is casting a shadow over the cash bonanza.

Texas could lead way in gas drilling disclosure

HOUSTON – Texas is poised to become the first state to require gas drillers to publicly disclose the chemicals they use to release natural gas from tight rock formations, a measure that could set the stage for other states and Congress to move ahead with their own initiatives to regulate hydraulic fracturing.

But environmentalists caution the bill, while a step in the right direction, remains too protective of industry.

Clement will summon oil execs for gas price grilling

Industry Minister Tony Clement says he will call oil refinery executives, gasoline retailers and distributors to Ottawa and demand answers as to the rationale behind fluctuating gas prices.

Big Oil execs hit back on tax proposal

NEW YORK (CNNMoney) -- Dragged before Congress as gas prices explode at the pump, oil executives mounted a vigorous defense of their business practices on Thursday -- pushing back against plans to eliminate tax breaks for the "big five" oil and gas companies.

All five executives acknowledged rising prices at the pump, but much of their testimony focused on the impact of a plan floated by Senate Democrats that would eliminate a raft of tax breaks.

US House votes for offshore oil drilling expansion

WASHINGTON (AFP) – The Republican-held US House of Representatives on Thursday voted to defy the White House and expand offshore oil drilling amid deep voter anger at soaring gasoline prices.

Lawmakers backed the bill by a 243-179 margin, but it was unlikely to clear the Senate, where majority Democrats have called such efforts giveaways to oil companies a year after the massive spill in the Gulf of Mexico.

Colorado Republicans push Obama on domestic oil production

WASHINGTON — Inspired by an onslaught of constituent frets about soaring gasoline prices, three Republican congressmen from Colorado are pushing the Obama administration to boost domestic oil production as a way to give consumers relief at the pump.

Nigerian Troops Attack Militant Camps in Oil-Producing Niger Delta Region

Nigerian troops launched attacks on suspected militant camps in the country’s southern oil-producing Niger River delta after a military patrol was fired upon in the area, an army spokesman said.

Pakistan Taliban Threatens U.S. as Blasts Kill 80

Twin bombings at a paramilitary police academy in northwest Pakistan killed 80 people in what the Pakistan Taliban said was in part revenge for the killing of Osama bin Laden and a precursor to attacks against the U.S.

Hundreds of Iraqi protesters demand better services, jobs, reforms by June 7 deadline

BAGHDAD — More than 500 Iraqi protesters have gathered in downtown Baghdad, demanding better government services and more jobs.

The demonstration Friday at Baghdad’s central Tahrir Square was one of the largest in Iraq in recent weeks.

Yemen's Saleh defies crowds demanding his exit

(Reuters) - Huge crowds in Sanaa and other Yemeni cities demanded on Friday that President Ali Abdullah Saleh leave after months of popular tumult that has brought the Arab world's poorest country close to economic meltdown.

But in a defiant speech to thousands of flag-waving supporters, Saleh declared: "We will confront a challenge with a challenge."

Pressure mounts on Gadhafi within Libya's capital

TRIPOLI, Libya (AP) — Pressure is mounting on Moammar Gadhafi from within his stronghold in the Libyan capital, with increasing NATO airstrikes and worsening shortages of fuel and goods. An activist said Friday that there has also been a wave of anti-government protests in several Tripoli neighborhoods this week — dissent that in the past has been met with zero tolerance and brutal force.

Qatar cancels plans to build power plants in Syria

In view of the continuing unrest in Syria, Qatar Electricity & Water Co (QEWC) has cancelled plans to build two power plants in the country.

Rosneft Still Weighing Arctic, Swap Deal Before May 16 Deadline on BP Deal

OAO Rosneft, Russia’s largest oil producer, is still weighing a proposal to replace BP Plc with the U.K. company’s local venture in an Arctic exploration deal as a May 16 deadline on a related share swap looms.

Ukraine, Russia start talks on gas pricing - Azarov

(Reuters) - Ukraine has begun formal negotiations with Russia to secure a new price formula for imports of Russian gas replacing that agreed in January 2009, Ukrainian Prime Minister Mykola Azarov said on Friday.

"Negotiations have just begun ... but I do not doubt that we will arrive at a formula which is acceptable to us," Azarov said in an interview with Reuters.

Japan to Help Tepco Pay Nuclear Claims; Banks May Have to Write Off Debt

Japan’s government will provide financial aid for Tokyo Electric Power Co. to protect the utility from bankruptcy as it pays compensation to those affected by the worst nuclear disaster in 25 years.

Japan Credit Rating cuts Tepco's debt ratings by 2 notches

(Reuters) - Japan Credit Rating Agency has slashed debt ratings of troubled Tokyo Electric Power by two notches although they remained three notches above the triple-B (BBB) grade that could help trigger liquidation by bond holders.

Lloyd’s of London Predicts $1.95 Billion in Claims From Japan Earthquake

Lloyd’s of London, the world’s oldest insurance market, said losses from this year’s natural disasters in Japan, New Zealand and Australia will cost about $3.8 billion, making it the costliest first quarter on record.

The Japanese earthquake and tsunami in March will cost Lloyd’s about $1.95 billion in claims, less than a tenth of the total estimated $30 billion total loss for the industry, the market said today in a statement. Claims from the New Zealand earthquake may total $1.2 billion, and flooding in Australia may cost $650 million, Lloyd’s said today.

Disaster Plan Problems Found at U.S. Nuclear Plants

ROCKVILLE, Md. — Despite repeated assurances that American nuclear plants are better equipped to deal with natural disasters than their counterparts in Japan, regulators said Thursday that recent inspections had found serious problems with some emergency equipment that would have made it unusable in an accident.

Uranium May Rise to $75 a Pound in 2012 After Fukushima, Uranium One Says

Uranium prices may trade from $70 to $75 a pound next year after problems at Japan’s Fukushima Dai- Ichi nuclear power plant are resolved, Fletcher Newton, a vice president at Uranium One Inc. (UUU), said in Beijing.

Panel on Nuclear Waste Disposal to Propose Above-Ground Storage

WASHINGTON — A commission created to help resolve the impasse over the disposal of the nation’s nuclear waste will propose establishing one or more sites where used reactor fuel could be stored in steel and concrete structures on the earth’s surface for decades, members of the commission said this week.

Gas prices push commuters to the train

NEW YORK (CNNMoney) -- Rising gas prices are helping drive big growth in ridership at several public transit systems across the country.

In Miami, passenger counts on the regional rail service connecting the city to the northern suburbs were up more than 12% in April from a year earlier, according to the American Public Transit Association.

In New Mexico, the "Rail Runner," a commuter train that runs from south of Albuquerque to Santa Fe, attracted 14% more riders last month.

And in the Raleigh-Durham-Chapel Hill area of North Carolina, ridership on the express bus service connecting the three cities is up 18%.

The spike is being attributed to people going back to work after the recession, and a steady rise in gas prices that's taxing the budgets of many motorists.

13 ways to save on gas this summer

Don’t tell the kids it’s going to be another staycation summer just yet. While the price of gas in the United States is still more than a dollar higher than the same time last year, analysts say gas prices may have hit their peak and are expected to drop, offering drivers some relief. In the meantime, there are plenty of ways to keep your fuel bill in check, from choosing the right destination to downloading the right app. Below, 13 tips for cutting the cost of that summer road trip.

Thieves drain $2,000 worth of gas from Pasadena, Calif. station

The suspects used some type of card or mechanism to trigger the pumps to release the gas. Officials say the suspects hauled it away using flatbed trucks, reports CBS station KCBS.

According to police the four men made off with 528 gallons to be exact, totaling about $2,246, reports the station.

The truth about airline fuel surcharges

The truth is that the only figure that matters is the total price—base fare plus fuel surcharge—and looking at either separately is rank idiocy.

Answer to cheap power is blowing in offshore wind

During the last ice age, glaciers a mile high pushed several dozen cubic miles of rock, sand and debris into the ocean off North America’s mid-Atlantic coast, creating a broad shelf that extends up to 40 miles offshore. This long, flat stretch of seabed and the shallow, windy waters that cover it make the ideal spot for dozens of offshore wind farms — and if all goes well, the network that would link those turbines together and back to the coast will soon be in place.

Smog-eating aluminum panels launch for buildings

Buildings that eat smog? Alcoa, a maker of aluminum products, introduced an architectural panel Thursday that it says not only cleans itself but also the air around it.

Resilience planning for wild weather and climate change

Queensland, the state of floods and cyclones that devastated property, has become Australia’s laboratory for sustainable building, for creating resilient homes, offices and structures in the face of climatic volatility.

In a radical scheme, Grantham residents who had confronted a deadly mountain of water in the floods, have been invited to apply for land swaps to higher ground after the small southeast town was declared the first designated reconstruction area under the new Queensland Reconstruction Authority’s powers. The local council is working with reconstruction authority to create the land swaps.

Oil slick threatens Arctic bay

MURMANSK, Russia (UPI) -- Russian scientists said it is "hard to assess" the effect an oil spill into the Barents Sea is having on marine life.

The spill occurred Saturday as water from melting ice carried underground oil into Kandalaksha Bay near Murmansk, RIA Novosti, reported. By Thursday morning, a slick that was one-fifth of an inch thick in places had spread across almost 52 acres, just under one-10th of a square mile.

Coastal nations urged to preserve Arctic waters

Two hundred miles above Canada’s most northern shore lies a body of international water that has been covered in ice for more than 800,000 years – a sea the size of the Mediterranean kept beyond reach of commercial fishing interests by a vast frozen dome of white.

But the ice shield is melting and no agreements are in place to prevent boats from China, Japan and other fishing nations from entering the High Arctic to reap an undersea bounty that could become accessible in just a few years.

Battle for Arctic oil intensifies as US sends Clinton to polar summit

The US government has signalled a new determination to assert its role in Arctic oil and gas exploration by sending secretary of state Hillary Clinton and other ministers to a summit of the region's powers for the first time.

Clinton and the US secretary of the interior, Ken Salazar, were both at the biennial meeting in the Greenland capital of Nuuk amid fears by environmentalists of a "carve up" of Arctic resources that could savage a pristine environment.

Iceland Views Arctic Oil Rush With ‘Apprehension,’ Minister Says

Iceland, the island that suffered Europe’s biggest banking meltdown during the financial crisis, is viewing the rush to develop oil in the Arctic region with “apprehension,” Foreign Minister Ossur Skarphedinsson said.

“There’s quite a lot of excitement about it in Iceland, but also apprehension because we literally are in the affluent of the Arctic Ocean so a spillage could have some serious consequences for countries like ours, as well as the Faeroes and Greenland,” Skarphedinsson said in an interview in Nuuk. “That is why it is important that the Arctic Council takes the initiative that only the safest practices will be used.”

Harper’s Arctic ice show: political stagecraft masks cold reality

The point of the exercise was to remind Canadians that the Conservative government is determined to defend this country’s sovereignty in the Far North.

“The first responsibility of government is to take care of our security,” Mr. Harper told several hundred Canadian Forces troops, mostly aboriginal Arctic Rangers and others who are part of the thousand-odd Canadians involved in this summer’s annual Operation Nanook military exercises. “Nothing comes before that.”

As Clinton works against global warming in Greenland, some there don’t mind it

NUUK, Greenland — Few places on Earth have seen starker changes in weather than this icebound island straddling the Arctic Circle. With that in mind, America’s top diplomat arrived here this week intent on calling attention to the perils of climate change.

The problem was that Greenlanders aren’t exactly complaining.

How peak oil solves the climate change problem

Peak oilists warn that fossil fuel depletion will cause an economic collapse.

Climatologists say carbon emissions will cause an environmental crisis.

To a certain extent, only one of these doomsday scenarios can happen.

Gingrich Feels the Heat for Appearing in Global Warming Ad With Pelosi

Every presidential candidate is going to come into the 2012 race with baggage. But Newt Gingrich has what, for primary voters, could be a doozy in his closet -- three years ago, he cut an ad with Nancy Pelosi for Al Gore's climate change group.

Sierra Club wants landmark climate law altered

California's quest to create the world's first clean energy economy was again under fire this week when the Sierra Club urged Gov. Jerry Brown to drastically alter key elements of the much criticized climate protection law.

The state's largest environmental group urged the governor in a May 9 letter to re-evaluate and revise proposed "cap-and-trade" business incentives, particularly the rules that would allow companies to offset their pollution by purchasing credits from clean businesses outside the state and country.

Scientist: Leave coal in the ground

The "father of climate change" has a stark message for those proposing to mine fossil fuels in New Zealand: "Leave the coal in the ground."

James Hansen, the first scientist to bring global warming to the world's attention in testimony to the United States Congress, is in the country for a series of public talks.

Research Panel Says Climate Change Doubts Slow Urgent Action

Public misconceptions of climate change have thwarted urgently needed U.S. efforts to reduce emissions blamed for global warming, according to a report from the National Research Council of the National Academies.

The media sometimes present aspects of climate change that are well-established as if they were “matters of serious debate,” according to the report released today in Washington. Groups opposed to policies limiting carbon-dioxide emissions are influencing some reporting, according to the study, which was requested by Congress in 2008 when Democrats were in the majority. It was prepared by a committee of scientists, engineers and economists.

2,300-year climate record suggests severe tropical droughts as northern temperatures rise

A 2,300-year climate record University of Pittsburgh researchers recovered from an Andes Mountains lake reveals that as temperatures in the Northern Hemisphere rise, the planet's densely populated tropical regions will most likely experience severe water shortages as the crucial summer monsoons become drier. The Pitt team found that equatorial regions of South America already are receiving less rainfall than at any point in the past millennium.

The article that quotes Navratil saying there are 3 trillion barrel rather than say 2 trillion barrels goes on to say he does not support peak oil. This is completely false. He supports peak oil he just places the peak a little further out say 2040 rather than 2010.

Good points. Most conventional oil depletion analysis is handicapped because of an over-reliance on Hubbert Linearization. The problem then is that peak oil "theory" is equated with a cheap heuristic and it will be judged to succeed or fail based on how the data lines up. It is really much more than that depending on how fast we can discover what is left and how much we have underestimated reserve growth.

I apply a model with a URR of 2.8 trillion and it still gives a peak around 2008. I don't know what kind of math they use to get a peak of 2040 for 3 trillion. At a constant production of 33 GB per year, 30 years is a trillion barrels, so that model could be a long plateau followed by a steep decline. The alternative is a fatter-tail slow decline, which is what I advocate. The HL model is pretty much toast and something better is needed.

The article is There is plenty of life left in this Oil Age yet just in case anyone was wondering.

The idea that there is one trillion barrels of oil left to be discovered is pure fantasy. Such a claim marks a person as one who is not really following the debate very close. Discoveries are falling off and the idea that they will one day spurt up again like they did in the sixties is just a little silly.

But Web, few of us peak oil followers are concerned with Hubbert Linearization. I haven't seen anyone post a Hubbert Linearization chart in months. And I don't see us being handicapped at all. Flow rates are what peak oil is all about. And flow rates, according to the EIA, made a new high in 2010. But a chart of JODI figures shows crude oil peaking in 2006. I am working on that data and will post a chart after the new JODI numbers come out next week. I realize that their numbers are not complete but I have allowed for that with other data and estimates.

Anyway I just wanted to point out that it is not about Hubbert at all but about flow rates. And of course oil available to all importing nations peaked in 2005. Net oil exports were down by 3 million barrels per day in 2009 verses 2005 and I expect that did not improve very much, if any, in 2010. Anyway you look at it, peak oil is in the rear view mirror.

Ron P.

I always wonder what kind of world that most of the depletion analysts live in. I happen to work in the world of statistics where you have to consider uncertainty, the role of entropy and variability, and do some logical modeling. So the fact that you have noticed that little mention of HL is made anymore is quite telling. (It still shows up in the TOD best-of archive and it is in the popular pieces, Deffeyes for example) The same problem exists with bottom-up data collection in that no room for extrapolation is possible. It is actually worse in that case because no allowance for future discovery is ever made.

The world of fantasy is where one takes a cheap heuristic and extrapolates that to some future trend, or does bottom-up without allowing for the unknown. That is why they have consistently underestimated how much we may have available.

Such a claim marks a person as one who is not really following the debate very close.

I really don't think it is about a "debate" as much as being able to deal with the data correctly. The days of just being able to eyeball things and make assertions or put faith in heuristics are long over. The future is about statistically analyzing what we have left and dealing with renewables or other non-oil non-renewables in the same way.

Anyway I just wanted to point out that it is not about Hubbert at all but about flow rates.

The Oil Shock Model is the only analytical approach that I am aware of that actually uses flows to estimate production rates. If you don't believe me look at the equations I use.

Ron, So my larger question is how to apply that JODI number suggesting the peak occurs at 2006. What will the URR be for that data? I have a peak at 2008 for a URR of 2.8 trillion. How can one peak at 2006 give 2 trillion and a peak 2 years later give 2.8 trillion? It is really about estimating the fatness of the tail in the out years. HL fails at this and bottom-up estimates fail at this because you need a good discovery model. This is interesting stuff but I wish that a little more thought would go into a model by some other curious folks.

Ron, So my larger question is how to apply that JODI number suggesting the peak occurs at 2006. What will the URR be for that data? I have a peak at 2008 for a URR of 2.8 trillion. How can one peak at 2006 give 2 trillion and a peak 2 years later give 2.8 trillion?

Web, you're joking right. Peak oil is about flow rates not URR. We will know what the URR really was when the last drop has been pumped out of the ground and not before. I hope to post my data and a chart with an explanation Friday, one week from today, or the day after. I will explain why I favor JODI over the EIA data. I have discovered a serious flaw in the EIA data and it concerns the massive revisions made last month in their data.

Up through December 2009 the EIA OPEC data had followed, very closely, the OPEC OMR data as well as the JODI data for OPEC. then in January 2010 the EIA OPEC data suddenly stopped this track and shot up dramatically as compared to the OPEC OMR and JODI data. But I am getting ahead of myself here. I will cover all this in detail at a later date. In the meantime I am still massaging the data.

I have no idea what the UUR is or will be. But I do have a very good idea when oil peaked, at least up to now. And I posted below, net oil exports peaked, quite clearly, in 2005, the same year that consumption in the US peaked. Peak oil is in the rear view mirror.

Ron P.

I'm excited to read about what you've uncovered/determined. You are referring to the 4 or 5 month period in which the production data for Saudi Arabia was revised up by 600K to 800K for each month? That revision has been bothering me since it came out.

Yes, that is most of it. Here is a comparison of EIA data, both Short Term Energy Outlook, EIA C+C, JODI OPEC and OPEC's Oil Market Report. The data runs from January 2005 thru April 2011 for the Short Term Energy Outlook and OPEC's OMR, thru February 2011 for Jodi and thru January 2011 for EIA C+C.

As you can see the data for all four follows closely until January 2011 when EIA C+C suddenly starts to climb. Then in April The STEO takes off, I guess in an attempt to catch C+C. ;-) Then in June, July August and September Saudi, according to the EIA, produced almost as much as they produced in 2008. JODI and the OMR says that this didn't happen. Platts and others agree pretty much with the OMR and JODI.

I really don't believe this dramatic increase really happened because the EIA C+C did not report it when it supposedly happened, they only revised it in their January report, the last one posted.

Saudi Arabia Oil Production January 2005 thru April 2011
Saudi Comparison

Note: The STEO OPEC data is Crude only while the EIA C+C is Crude + Condensate. The STEO data for all non-OPEC is all liquids. This leads to quite a bit of confusion.

Ron P.

Ron, As some helpful advice you might want to consider the XY scatter plot in Excel so that you can label the X axis with something more meaningful than months. The description of when the upticks is confusing because you said it takes off in Jan 2011 whereas it should be in January 2010?

I replotted it below :

Yes I should have said it takes off in January 2010. I often make stupid mistakes like that when I am in a hurry. Thanks for the correction.

I must figure out this XY scatter plot. I have never used it before.

Ron P.

The key to it is that you use a column for the dates and then apply a "edit, fill, series" menu command to populate the column. Then you chart with that first column as the X series, which it will do automatically if you select a block of data with the XY Scatter type. I am using OpenOffice right now but Excel does it the same way.

Web, you're joking right. Peak oil is about flow rates not URR.

I did clearly state that I considered flow rates as well as the URR. The Oil Shock Model is based on stochastic flow rates modeled at different points in the oil production process. I laid this model out in the online book The Oil ConunDrum. I am not joking about this because it is based on tried and true analysis that other disciplines have used for years but from what I can gather that the oil geologists haven't figured out yet.

I am still massaging the data.
I have no idea what the UUR is or will be.

Surely, you are joking? I don't know how you can say this and also believe in the concept of a finite resource. There are two components to this kind of model (others call it a compartment model BTW) the estimated size of the compartments and the flow between the compartments. Without an estimate of the size of the container the flow reaches a steady-state. You are just looking at perturbations in the data from the steady-state flow and without a model of the size you really can't get a handle at the long-term truth.

I have no idea what the UUR is or will be. But I do have a very good idea when oil peaked, at least up to now. And I posted below, net oil exports peaked, quite clearly, in 2005, the same year that consumption in the US peaked. Peak oil is in the rear view mirror.

No doubt that what you are doing will help in figuring out some of the recent OPEC data but that is not what we are talking about, which is the long term analysis. So you really have no idea of how much oil is in the tail of the decline?

Of course you can say that it will depend on price, but that will point back to a quantitative analysis as there are estimates of URR for the different grades of crude oil and one can apply the concept of EROEI to see how effective extracting that difficult oil will be.

Web, I am not in the model building business. And to Oct who wrote below:

So presently the best predictive tool is Web's model.

I am not a seer of the future either. As far as peak oil is concerned I am basically a historian. Peak crude oil happened in 2006 and peak oil available to all importers happened in 2005. Also US oil consumption has decreased by almost 8 percent since 2005. Now that is a lot and that is, in my opinion, very important. The reason for that decline was peak oil and in particular peak oil exports which took place in 2005.

No doubt that what you are doing will help in figuring out some of the recent OPEC data but that is not what we are talking about, which is the long term analysis.

No, we are really debating peak oil, whether it is in the past or in the future. My argument is that it is in the past and I believe the data, other than the EIA data, supports that. And even the EIA data agrees that net oil exports have declined by 3 million barrels per day since 2005.

How much oil is in the tail of the decline is important but not the most important thing. I don't think you are the seer that you believe you are. The economy is really something that is almost impossible to predict. Will there be massive inflation, or perhaps deflation? Will there be massive unemployment that will kill the demand for oil, knocking the price down? I really have no idea. All we really have is the past. All we have is the past flow rates and we can see that they are up and down but at least according to JODI the overall direction since 2006 is down.

And no, I will not say it depends on price, I will say that the price will depend on the availability of oil as well as the state of the economy. And the state of the economy depends on the availability of oil as well as the price of oil. Confusing I know but they are all tied together and the tipping point is, or rather was, peak oil.

I don't think you are the seer that you believe you are.

Hmmm, I am trying to get people interested in applying some different approaches. Sam Foucher picked up on some of it a while back but that is about it. Lots of other people look at it with an open mind which is also good.

So the main thing is that I put it out here so people can take a look at it and improve on it if they so choose. Or criticize where I have something wrong.

I get a lot of "Well you haven't done Iraq or Brazil, so there!"

It helps a lot more if you say something constructive.

It helps a lot more if you say something constructive.

You are doing a fantastic job at whatever it is that you are doing. How is that? What I meant to say was I don't think your mathematics can really predict the future of oil production. Don't take it personally but I really don't believe anyone can do it, it is not just you.

Now there are a lot of things that can be said about the future, like things that will eventually take place, at least that is my opinion, for what it's worth. Like we know that the earth is in deep overshoot and sooner or later there will be a massive reduction in population. That is a lead pipe cinch. What we cannot say is when it will happen or how long it will take or how the whole thing will play out. No mathematical algorithm can be created that will predict these things.

So playing with stochastics may be lots of fun but I really don't think they are a very good predictor of the future. That was my point.

Ron P.

I'd like to make another constructive comment. I read and enjoy WHT's statisitical and mathematical model comments, but I think he has a comparative advantage in prose. His prose is excellent.

It is fair to say that nothing is certain yet probability theory is the way the world operates in terms of everything from insurance policies to gambling payouts. It is the best alternative out of the few alternatives we have for predicting outcomes. This is the no-brainer part of my decision to approach it this way. YMMV.


I'm kind of tired of hearing about Hubbert's inadequacies. He was out there making pretty darn good estimates when there was much less data to work with. More importantly, he saw the big picture before anyone else and wasn't afraid to make his case. If we can see farther today it's because we have his shoulders to stand on.

I think the reason little is mentioned about HL anymore is because so many recognize that we are just past or at least at the peak now, so there's little point to debating one model vs. another. Web, I enjoy and respect your work, but at this point our need for predictions and explanations of peak oil are less urgent than our need to figure out how the hell our kids are going to eat.

But if extraction rates change as in oil shocks, then Hubbert's math cannot account for it.
Hubbert knew that and he hand waved about it (you can watch it on Youtube if you want).

That is Web's point and it is valid, since he can model oil production with a simple model and a series of shocks in the extraction rates.

So presently the best predictive tool is Web's model.

Very well put , thx!
Jevons, Liebig, Maltus have also been "proven" wrong by far to many shortsighted professors looking "the other way".
The values of the lectures of these folks (Jevons, Liebig, Maltus, and more) will be better understood when the remedy Crude Oil falls into short(er) supply.
Wherever their spirits are ... they have probably already been seated at first row well stocked up with coke n' popcorn .... ready for the premiere of "PO_first proper act".


I respect the work too and if it's your thing so be it - but at some point it just amounts to so much mental masturbation.

Regardless of the ultimate shape of the "fat tail" the world we now live in is depending on their being nothing resembling a tail whatsoever... A tail refers to decline and the problem we face is not that it's X% decline being factored in to forecasts when it should actually be Y%... it's that the forecasts are all banking on X or Y% increase in production.

In other words we can't get the "serious" analysts to even recognize Hubbert consistently nevermind arguing over the details of the shape of the curve.

I've paraphrased the quote (source unknown - wish I could find it again) before on TOD - I think by a climate scientist weighing in on the "debate" over climate change - "the human species will go down in history as having studied the minute detail of its own extinction" which I took to mean that we study and study and gather data and evidence ad nauseum but what the hell does it matter when we fail to act (or even acknowledge) on what the big picture evidence is smashing us over the head with.

Kingfish, Web doesn't need me to defend him, but I think it's worth pointing out that Web (as I understand it) is concerned about the robustness of the argument necessary to influence public policy. That is, he understands that the data and standards of evidence and proof needed to change the course we are on at the level of government initiative is very high given that the established paradigm denies that there is any validity at all to the whole concept of Peak Oil.

OTOH, you and I are already convinced. I (and I'm guessing you, too), do not require Web's standards of proof in order to take the actions I believe will help mitigate the harshness of the challenges I think I will face going forward. I already possess what I believe is a robust enough data set (and at a high enough confidence level) with which to set a future course for my own little boat. But many others aren't there yet.

My own personal opinion is that it is a waste of one's time and energy to try to influence the course of public policy. But I suppose it's an interesting and enjoyable intellectual challenge to at least assemble the pieces necessary for the attempt. At any rate, I'd never try to tell anyone what they should do with their own time.

Well put. I pay close attention to the way the discussion is playing out in the media and it is predictably taking the same course as the climate science "debate", where the skeptics are now pinning the conventional PO analysis with all sorts of nit-picky arguments that they made against the GWCC studies. Certain media outlets that have never mentioned Peak Oil before are now suddenly launching into attacks (or even bringing up abiotic oil) against some analysis, say in terms of how how much the Arctic National Wildlife Refuge actually holds. How do you respond to something like that apart from actually doing a deeper analysis? Its not enough to say that Hubbert predicted something would happen, instead you come back with an up-to-date analysis and then you say that the government is holding back historical data that can help with a better analysis. You essentially want to make your case better and better so that the decision makers get convinced and the skeptics become marginalized. That is the theory anyways. People can say it is tilting at windmills, but remember as Jabberwock said, it is not wasting your time, it is using up my time which I am free to waste as I want. This forum allows me to sharpen my arguments as well, so thanks.

I actually sent a letter off to my US senator who sits on the energy committee. I haven't heard anything back yet but it doesn't mean I will not keep trying.

The above discussion reminds me of some papers by Adam Brandt. This one "Testing Hubbert":

and this one, which Brandt co-authored for the UK Energy Research council:

The big question is whether production is best modelled by a symmetric curve (with decline rate after peak similar to growth rate up to peak) or by an asymmetric curve (with very different growth and decline rates).

In the first paper, Brandt argues that asymmetric models work better when describing regions which have already peaked. Though his analysis suggests that no single model describes all regions. For instance US Lower 48 is described quite well by a symmetric Hubbert (strictly Gaussian) model, yet is also described well by a symmetric "linear" model: straight line up to peak, then straight line down again. There are significant regions which aren't described well by any "single peak" model, notably Saudi Arabia.

There is support for this in the second paper too: see Figure 2.19 (page 34) and Table 3.7 (page 68). The estimates there are that many post-peak countries and giant oil fields reached their peaks well before they became 50% depleted; the average peak seems to be closer to 1/3 of URR. That fits in with a "fast rise, slow fall" model.

Notice that if this applies to the world as a whole, then we could easily be at (or just past peak) now, having produced slightly more than 1 trillion barrels of a URR of 3 trillion barrels. Whereas in a symmetric model, if we are at peak now, then the URR would be about 2 trillion barrels. So both positions on global URR are justifiable.

Incidentally, there is a further argument to be made here that the differences in URR estimates really shouldn't affect estimates of peak date much. If you assume a low global URR, then you should also have a low URR estimate for the countries and fields that are already past peak; so this leads to a high estimate of the depletion fraction at peak e.g. close to 50%. Whereas if (like Brandt) you assume a URR of about 3 trillion, say based on USGS 2000, then you should also assume a high URR (+ fat tail) for the countries and fields that are already past peak, which brings down the estimate of their depletion level when they were at peak e.g. to around 35%. These effects will compensate each other, and peak should still be about now whatever URR you assume.

What you can't plausibly do is argue for a high URR, and a symmetric model. It's even less plausible to argue for a high URR and an asymmetric model but skewed in the other direction (with faster decline rates than growth rates). That's the only way you can get a peak around 2030 or later.

By the way, the above only applies to conventional crude (or C+C). "All liquids" is a bit different.

Notice that if this applies to the world as a whole, then we could easily be at (or just past peak) now, having produced slightly more than 1 trillion barrels of a URR of 3 trillion barrels. Whereas in a symmetric model, if we are at peak now, then the URR would be about 2 trillion barrels. So both positions on global URR are justifiable.

That is pretty much the premise.

Incidentally, there is a further argument to be made here that the differences in URR estimates really shouldn't affect estimates of peak date much.

That finding results from doing the modeling.

What you can't plausibly do is argue for a high URR, and a symmetric model.

That contradiction makes the case against Hubber Linearization, as this would push the peak to the out years.

I recall reading recently a remark once made by the late Daniel Patrick Moynihan to the effect that “everyone is entitled to his own opinions, but not to his own facts.” (Quoted from memory.) I think of that remark now whenever I encounter peak oil and global warming deniers—not that it’s any help in arguing against such denials, since the disputes invariably revolve less around facts than around opposing, but not always explicit, worldviews (e.g., limits to growth vs. none). Reminds one, too, of Thomas Kuhn’s suggestion that new paradigms don’t gain ascendancy so much because they convert those who cling to old paradigms as because those who champion the old ones eventually die off. In a way, Moynihan’s remark, just as Kuhn’s work, points to the difficulty of having rational or fruitful arguments when profoundly different perspectives are in conflict. If a fact is a datum in a system of data (forget where I first heard this idea), there is not surprisingly a lot of arguing at cross purposes with respect to global climate and resource depletion. In the end, of course, nature will do what nature will do, regardless of what we humans think.

Reminds one, too, of Thomas Kuhn’s suggestion that new paradigms don’t gain ascendancy so much because they convert those who cling to old paradigms as because those who champion the old ones eventually die off.

Yes, Max Planck expressed the same idea when he said: Science advances one funeral at a time.

Ron P.

Yet, there is a big difference between the facts and the truth. We are at the mercy of whoever provides us with data to quantitatively interpret the facts. So the facts equals the data we can access at the present time with a large dollop of uncertainty thrown in. The truth is what lays underneath the data after reducing the uncertainty and what is in store for the future.

So the context is what is closer to the truth: a 2 trillion URR that is guessed at by some of the questionable heuristics we have used in the past, or is it closer to 3 trillion that this guy Navratil proposes? Who knows, he may have his own model that he is keeping to himself or his organization. I don't really go for that approach and prefer to keep the analysis out in the open.

The difference between 2 trillion and 3 trillion will make a difference, as will the lower-grades of crude that will still be available.

In the end, of course, nature will do what nature will do, regardless of what we humans think.

The truth doesn't pay attention to the binary distinctions of 2 trillion equating to peak oil and 3 trillion indicating not peak oil. But this doesn't mean that you give up on seeking the truth, because it will in fact help with decision-making policy.

The climate scientists know the importance of distinguishing between the data and the truth. The facts and data is what we observe right now and what exists in the historical record. The truth is only found out by applying a scientific method and extrapolating to the future.

The truth is only found out by applying a scientific method and extrapolating to the future.

Well, let's test that astounding assertion with, say, meteorology - and by that I mean the subject that applies "scientific method" in the form of computer models to "extrapolate into the future" and forecast tomorrow's weather (as opposed to the rather different subject of TV talking-heads spectating out loud at screens displaying possibly cherry-picked model results.)

The test seems to go rather badly, since there are plenty of disparate forecasts for tomorrow's weather, depending on the vagaries of which scientific model and which run one might examine. There simply is no "is 'the truth' "; there is only an assortment of quasi-"truths" that cannot be sorted out until after the fact. And the long persistence of a plurality of "scientific" models producing disparate results for the same data set is a bit disturbing with respect to assigning a useful meaning to the adjective "scientific" as used in "scientific model."

Now I could be wrong, but I would absolutely expect resource depletion models to suffer from analogous problems - and in spades since inherently uncharacterizable and unpredictable (with even remotely adequate precision) economic and social factors also come into play, unlike with tomorrow's weather which is essentially pure physics. So a bit of humility might be in order.

To make a statement against someone's science using weather models as your talking point is rather cynical. The same can be said for politicians that predict how the markets will respond to their policies.

Of course, thermodynamics, electrodynamics, chemistry, physics -- all those predictive tools turn out to actually be reasonably correct.

So why would oil extraction be subject to the laws of the unpredictable weather?

It is not so hard to understand. There is oil only on the upper skin of the earth and we poked holes all over the planet. There are plenty of economic forces pushing for extensive drilling. We even know where oil is that we are not allowed to drill yet.

So how do you reckon the model is wrong? (That everyone lied about past discoveries?)

How do you know that random dispersive processes do not follow natural log relationships?

The discoveries peak alone tells you the truth of the matter. Forget the exact minute and second of the peak. No one can deny history.

So Web's model is basically saying that extraction rates and depletion kinetics will occur according to natural rate laws. What do you disagree with there.

Basic issue is that we are trying to predict the rate of extraction, into the future. Agreed?

That rate is determined partly by geology & technology - mainly the upper bound. However it's much more defined by the societal systems and feedbacks that drive which resources get extracted, in what order, to what level of completeness, and with what caps put on practical rate extraction.

Even worse, the rules of the game on the way up ARE NOT the rules of the game on the way down. The reality that there will be less available tomorrow ripples changes throughout the system and behaviours. Therefore taking what's happened in the past cannot give you information on what will happen in the future.

WHT's model is a resolutely stochastically/mathematically based model, and implicitly takes how things behaved before as the model of how things will happen in future. Furthermore, in previous discussions, WHT has said he doesn't hold with complexity or detailed system feedback effects as the determinates for a workable future production model (I think I remembering him say he didn't hold with complexity at all).

So that's why I think the model is wrong - it ignores the system and the complexity derived from system effects. It might give an estimate of the upper bound, but even here, you can conceive of a scenario where exploration rates is a decision taken out of the hands of businesses (eg it might increase).

I kind of liken it to Black-Scholes in economics - nice maths that works OK within the confines of the assumptions made, but where those assumptions mean it stops working when interconnected system effects dominate.

Basic issue is that we are trying to predict the rate of extraction, into the future.

Sure, no one has tried to do this before, and I think I have a good framework for the analysis.

(I think I remembering him say he didn't hold with complexity at all)

I gave a decent account of my evaluation of complexity in a TOD article I wrote a while ago. The gist of it is that as things get more complex, they actually get simpler to evaluate. This is not actually a very extraordinary statement as it explains all of statistical mechanics and entropy. This simplification also explains things like random matrix theory and network behavior which have been in the news recently. These tend to converge to simpler expressions independent of the complexity of the configuration. I am just applying these ideas to disciplines that haven't been exposed to the ideas or that the people in charge didn't think they would need.

Stuff like chaos theory and attractors is actually craptastic because those ideas actually don't consider the complexity in the proper context, which involves the state of disorder in the system. Once that goes through the wash you are left with behavior that simply revolves around the mean energy values and a maximum entropy spread in variability.

So that's why I think the model is wrong - it ignores the system and the complexity derived from system effects.

Yet the point is that no one has actually made the effort to get to the point I have gotten to. That should be the baseline. You need to get to at least this point, and consider the disorder in the system, before you go on to the next stages, which is what you are advocating. If these second-order effects are swamped by the first-order effects of entropy, then you are really back at the baseline. I would like to see an example of something that I could try to deconstruct.

I think I am on to something very obvious with most of my work and that is the problem. It is so blindingly obvious and run-of-the-mill in fact that most physicists and scientists don't want to admit to it or discuss it further. You see, disorder smears the effects that they desire to see. The physicist and economist Didier Sornette, who is an associate of Taleb of Black Swan fame and has worked with Laherrere, wrote a book on critical phenomena in the natural sciences. Its a good book because he does a lot of useful analysis, but in one section he goes through all the possible mechanisms that could give a "power-law" distribution which is a hallmark of certain interesting physical processes (and potentially Nobel Prize worthy). Yet he completely neglects the fact that one obvious case of power-law comes from dividing two random distributions each with a mean. Something as basic as Rate is deltaX/deltaT can give a power-law distribution. But this is not considered interesting because it is not earth-shattering new physics so Sornette conveniently ignores it. Well, I don't ignore it because that is the state of the world; all these agents performing independent seemingly random processes yet it all becomes easily characterized. -- just take a look at the distribution of stripper wells upthread, that is a one parameter fit and I don't need to understand system complexity. That result comes through the wash of disorder and entropy all on its own.

Like I said, you have to get to this point before you take it somewhere else. You are applying the leapfrog argument or demanding impossible perfection, whereas I suggest that we look at what we have and go from there. I am seriously looking at the possibility that the model is wrong but you have to really lay out the special context before it means anything to me, more than just an assertion on your part. You want EROEI, I can add that easily. You want a networked ELM model, I could take a shot at that.

So a bit of humility might be in order.

You still haven't shown an understanding or appreciation of probability as this same knock comes up in many of your comments. When you are talking about quasi-"truths", I immediately see that as a probability distribution. So the weather forecasts are multiple continuously updated Bayesian estimates that get better and converge over time. Most people don't see it that way, and it doesn't have anything to do with humility, but depends on education level. Not much I can do about that situation.

WHT prediction of FSU


according to him, it should be in decline by 10% by now. As I said before if you get countries like Russia wrong you will get world production wrong and you did.

If he starts doing weather forecasts we will all be wearing coats in July.

Thanks for providing the example. That chart from 2005 showed a projected trajectory given only knowledge of the previously reported FSU yearly discoveries. In other words, there was no discovery model attached to the data. It was raw discovery data, with no modeled extrapolation for future discoveries.

So what you are seeing in my blog is the analysis done in real time over the years. I started essentially in 2005 with the Oil Shock Model and a gradual refinement until I could put it together within the larger volume (The Oil ConunDrum). So when I made that chart I still hadn't come up with the Dispersive Discovery Model that I only completed in 2007.

Earlier this year, I spent some time revisiting FSU and comparing it to the alternate ASPO prediction for FSU. This time I actually placed in an extrapolated Discovery Model for the out years. So in a way this was a calibration of the model. This is what it looks like when laid up against the ASPO. The key idea here is to look at the oil shock perturbation notch during the FSU breakup and see how it models the production profile. That's pretty neat.

So it shows lots of things going on, and of course the out year projection is based primarily on the model of past discoveries and that the proportional extraction rate maintains at the historical levels. Its a good start and am proud of my work with the data I have available.

Now Web, the one thing I thing we all do not know is what the future rate of extraction may be. How will the oil extraction rate constant shift in the future? That is a source of uncertainty in your model.

Of course, what people may not appreciate. The way it will go based on a historic perspective is a decrease in oil extraction rate. World oil extraction rate has not increased since the 70s. Thus peak oil would only hit a little further out.

So... why all the fuss?

Just want to acknowledge to all involved that this is one of the better strings I have seen on TOD for the last year or so. I was here >5 years ago to learn but don't post much anymore. Nothing to contribute and nothing really new in the data or discussion, just noise around previous predictions. I check in once in a while to catch up on insider details.

I congratulate all the posters in the string for staying civil, talking about the complexity of the problem and difficulty in making accurate predictions over any 24 month period. This is how differences in interpreting highly complex issues should be discussed. Nearly everyone seemed to be learning about something or somebody along the way. Highly useful example to newcomers IMHO.

Yes, certainly that shows up in the cusp of the oil production profile for FSU near the peak at 2010. My estimate returned the extraction rate to what it was previous to the Soviet breakup. We knew the extraction rate had to rebound after the transition but we don't know if would return at a higher or lower level than before.
Was the capitalist Russia more greedy than the Soviet Union, or did they have more efficient technology? That's essentially a judgment call so I left it as is. Yet the point is that one can fiddle with the stochastic mean extraction rate and see how the outcome will change.

I think Westexas and Foucher have a similar analysis for Russia with a spread of outcomes.

Sounds like you are a cherry picker. But you failed to cherry pick the correct predictions. Maybe your horse-blinders are on too tight to show both sides of the coin ;-)

Aspo published paper with some interesting predictions particularly Saudi Arabia


The Aram thesis clearly shows that people should not be too sure of themselves when they say peak oil happened in 2006


The first paper is hand-wavy qualitative and I have read some of Bentley's other papers which say basically the same thing.

The second paper does modeling but makes no mention of convolution and doesn't consider proportional extraction rate, which is the key to adding elements variability to the calculation. His way is not the way I model the real world.

In the worst case, Russian oil production and also the oil export will peak very soon or has already done so in 2006. In the best case, a constant export can be held until 2036. It is not likely that the Russian production will increase more than 5-10% over today’s level.

The point is that Russia does have some difficult-to-reach frontier areas that could contain future oil discoveries. That explains why the global context is important. The amount of oil left to be discovered in Russia is smaller in proportion to the world than it is to the total in Russia. This is simply an application of the law of large numbers. The peak may extend for Russia but not necessarily for the world.

Need to clarify your point.

The point is the Sam Foucher did this piece on Russia a couple of years ago.


He calculated production level from new fields, however most of them have in fact done better than he predicted.

There are also new areas which are believed to contain quite large amounts of oil, so could delay peak by another few years.


We have increased our output of oil and gas. Growth in gas production has reached almost 12%. As for oil, for the first time ever, we have produced 505 million tonnes per year. Today, Russia is the world’s leading oil producer. And we must continue to maintain this production level in the years to come.

I’d like to draw your attention to the fact that we have increased oil output primarily by extracting from major deposits in Eastern Siberia, such as Vankorskoye, Talakanskoye, and Verkhnechonskoye. We have also begun production at the Korchagin deposit on the Caspian Sea.

We have increased our output of oil and gas. Growth in gas production has reached almost 12%. As for oil, for the first time ever, we have produced 505 million tonnes per year. Today, Russia is the world’s leading oil producer. And we must continue to maintain this production level in the years to come.

I’d like to draw your attention to the fact that we have increased oil output primarily by extracting from major deposits in Eastern Siberia, such as Vankorskoye, Talakanskoye, and Verkhnechonskoye. We have also begun production at the Korchagin deposit on the Caspian Sea.

OK, so now we have established you are from Russia. Russia is one area from many when we consider global oil projections. My estimate of URR of 2.8 trillion barrels accounts for future discoveries in remote areas, such as from Siberia for example.

The point I have been making for months on end now is, if an error is made with a significant country such as Russia then the error will effect global predictions.
Non OPEC did not decline because Russia did not decline.

There are just a handful of countries whose rate of increase will determine future global production, none are more important than Iraq.

This country alone will determine what happens over the next ten years to global oil production.
Failure to produce an production graph for this country and everything else is cheap talk and what is the point of that.

Yair...A bit off topic to slot in here but can anyone tell me what proportion of U.S. lower 48 on shore oil production is from ten barrell a day or less stripper wells?

I think I read somewhere it was about fifty percent but I can't confirm that number...which may now be irrelivent anyway with the Bakken improving the numbers.

I would appreciate information or links as the subject has come up in a local peak oil discussion.


I'm relying on memory here (which, of course, is fallible), but I think the production of total U.S. oil (including offshore) that comes from stripper wells is about a quarter of the total, or maybe a fifth of the total, but it is nowhere near half.

By digging in the Archives you can find the right number.

Hey guys, all you have to do is Google it. What did we do in the days before the internet?

Stripper Well

In the United States of America, one out of every six barrels of crude oil produced comes from a marginal oil well, and over 85 percent of the total number of U.S. oil wells are now classified as such. There are over 420,000 of these wells in the United States, and together they produce nearly 915,000 barrels (145,500 m3) of oil per day, 18 percent of U.S. production.

Ron P.

"What did we do in the days before the internet?"

We had lives. :-)

Still, there's a good question in there. If we're going to have to give things up, which technologies do we give up and which do we try to keep? How easy is it to move back down the technology ladder?

Do we give up communications networks entirely? Do we keep fiber optics and IP (which can carry all the media) or do we go back to separate analog networks for everything? To an increasing degree, the old analog networks are disappearing. For example, the vast majority of long-distance voice traffic in the US is moved over IP networks, regardless of the type of local delivery. An analog long-distance phone network would have to be built; we've torn out the one we used to have.

I spent twenty-five years as a technologist telling management "It's all about the software today." An amazing range of things that used to be controlled using electromechanical components are now run by sensors and software. Consider that in the development of the transmission in GM's newest hybrid SUV, software running on the embedded processors accounted for two-thirds of the engineering hours. The systems and technology that sensors/software have replaced are rapidly disappearing; if we lose the ability to do 100-million-transistor chips, can we go back to what was used immediately prior, or do we slide much farther down the technology ladder?

Good questions. I guess I don't think we (talkin' USA, here) have a society capable of deciding much of anything on that level. The "Internet" is very useful and fun and all, but that doesn't make it inevitable or even viable in an energy-constrained future. At least not as it is currently expected to perform.

So when you say, "which things do we give up", I think first of all who is "we", and how much do "we" get to pick and choose. But I believe we (all!) are going to find out!

Semiconductor fabrication plants will be built next to hydroelectric power dams if the grid gets too unreliable.
That is a very high-value application in every sense of the word.
Semiconductors are far more efficient and durable than vacuum tubes,
LEDs are far more efficient than light bulbs, and you can also get solar panels.

RE: Stripper Wells
Sorry to come up late on this but we just had ongoing discussions about this on some recent TOD threads http://www.theoildrum.com/node/7858/800300, so I will summarize again.

The following table from the EIA http://www.eia.doe.gov/pub/oil_gas/petrosystem/us_table.html gives the distribution of production rates from existing oil rigs.

I plotted this as a histogram and compared it to a physical model for reservoir size distribution:

The excellent fit to the data is the equation p(Rate) = r/(r+Rate)^2, where r=median rate=1.6 barrels per day. So you can immediately see that half the wells in the USA are less than 1.6 barrels per day, i.e. the stripper wells. Of course this doesn't mean that we get half of our production from these wells. The bigger producers shift the mean to 13 barrels per day. That is a common feature of fat-tail statistics, in that the big "outliers" can alter the bottom line quickly. I put square quotes around "outlier" because outliers are the signature of fat-tail statistics.

The stripper wells are kind of the baseline supply and the bigger wells are the fluctuations -- a lot like the wind energy fluctuations that seems to get people upset. In reality, this is really just entropy at work, albeit at different scales.

The stripper wells are kind of the baseline supply and the bigger wells are the fluctuations -- a lot like the wind energy fluctuations that seems to get people upset.

Well, I don't know if that is really a good analogy. The stripper wells keep on producing predictably, day, day out. If we were to plot the daily production of those wells for any period (months, years), in any given state, I expect it would be a very smooth line.

For wind turbines the baseline is - zero - there are days when an entire state, even several of them, will have zero production, 1-2% of capacity, which may as well be zero.

Ironically, the things with the most reliable production - the wells, are an energy form that is storable and so reliability is not critical. But a barrel of oil from a stripper well is just as useful, and worth just as much, as the same grade oil from a high productivity well.

The things with the least reliable production - wind turbines - produce the commodity that values reliability/dispatchability the most, so wind energy generally averages a lower market price than from other generators.

As you have remarked before, it is predictably unpredictable, and we haven't really worked out how to make best use of this cheap but unpredictable source. When we do, I expect to see as many "stripper turbines" as there are wells!

Aye, but lest we forget that the stripper wells will all be eventually stripped clean, while the wind will remain. I am glad that you understood the analogy well enough to criticize it, which is all that we have to go on for now. It is really all about the analysis and some good ideas.

The fundamental difference between oil wells and wind turbines is that you can store oil in tanks and deliver it where you need it when you need it. The wind blows and doesn't blow on its own schedule, and you can't store wind in tanks. The result is that when you have too much wind and no demand, you have to shut down the turbines and waste the energy, and when you have no wind and a lot of demand, you are screwed. You need to have backup for wind power.

And, while the wind never stops blowing (except intermittently) the wind turbines have to be constantly maintained and replaced when they wear out, which costs money and uses energy - generally a lot of money and a considerable amount of energy.

But the oil wells will all eventually be stripped clean, so wind wins in the end.

Above: Global resource consumption to triple by 2050: UN

UNITED NATIONS — Global consumption of natural resources could almost triple to 140 billion tons a year by 2050 unless nations take drastic steps...

No, it can't. But I suppose this is the point of the article,,and TOD.

Perhaps this is why I don't get excited about fusion. Should humans achieve a major breakthrough in an affordable, "unlimited" energy source, it will be the great enabler, the sword that cuts both ways.

But the UN panel has a solution:

"A UN environment panel said the world cannot sustain the tearaway rate of use of minerals, ores and fossil and plant fuels. It called on governments to "decouple" economic growth from natural resource consumption. "

Why didn't I think of that - of course - just figure out how to continue economic growth without energy. That gets rid of that pesky peak oil problem!

I feel better now - the UN always comes to the rescue.

Maybe it's meant as a general warning about overpopulation and sustainability.. But if it is, the authors sure managed to wrap it in a lot of hot air and cover it with brightly colored glitter.

"It called on governments to "decouple" economic growth from natural resource consumption. "

Humans will decouple from growth, period, regardless of what their Governments do, at least on this planet.

I guess what they're trying to say is that we need to reach a level where we no longer consume and discard resources but instead continually recycle to support a sustainable society that only lives off the energy directly received by the sun.

How that's achievable is anyone's guess!

recycling is little better than discarding. 200 years ago we needed to begin the process of technical standards in production so that everything could be RE-USED. 50 years ago we needed global taxation on containerisation and palletisation, to keep commerce local. Unfortunately, gov's were too incompetent.
Can anyone tell me what the standard for a x-point screwhead is??

I don't mean recycling in the sense that it is used today, I mean truly recycling the elements.

The difficulty in true recycling lies in the energy needed to separate materials into their constituent elements.

Goodly electron beam, like in an electron beam welder, ablates.
Giant mass spectrometer collects.

I once did ran a correlation, using the number of hours worked and the quantity of primary BTUs as independent variables. Those two variables explained something like 85% of GDP.
You need inputs to create output.


Message: We must grow regardless. Just because we are running out of resources doesn't mean we can't grow.

Redefine growth: Just publish numbers that show growth.

Better to redefine what is necessary for a reasonable quality of life. For example, cutting down the use of the auto might reduce growth but would increase health. Health is wealth. Use genuine progress indicator rather than GDP.

That's an easy one. I buy some electronic document from you for however much money and you buy one off me for the same amount. Neither of us has to want the document, but the faster we swap our money for bits backwards and forwards the higher GDP will rise.

And we all know that a higher GDP is the only thing that matters right? Everyone can be rich following this easy scheme. It's so brilliant it might just get implemented.

I buy some electronic document from you for however much money and you buy one off me for the same amount. Neither of us has to want the document, but the faster we swap our money for bits backwards and forwards the higher GDP will rise.

I see one obvious fly in this ointment: a government at one or both ends of the transaction will insist on its cut as a sales/value added/goods and services/income tax. So the two parties involved do not each receive the amount each spends, but only part of it.

I don't see any way such a scheme could become part of GDP without being taxed, and if it's taxed it won't work.

True, we'd have to lobby for some tax breaks, such as 0% VAT, or 0% sales tax. Additionally, all expenditure would have to be 100% allowable for tax to ensure neither of us ever shows a profit. We could argue that with the boost to GDP it is only right we are exempt. We may be able to get away with a one time only kick back to some government officials leaving us to raise the GDP to our hearts content. Maybe we could even receive some local business awards and receive some real accolades for our outstanding contributions to local GDP.

Just checking you know that my tongue is firmly in cheek, though I wouldn't be surprised if this kind of thing happens just to keep boosting that number. In the end it would probably be easier just to lie outright.

The information economy can continue to grow without corresponding increases in energy usage.
The amount of energy required to move or store a given amount of information continues to drop.

We will not acquire THINGS as we used to, but we could have access to more information,
more words, more art, more music, even than we do now.

... and we can grow and eat virtual food:

Fun Dining Without The Calories - Send Virtual Beverages,
Coffee, Gourmet Meals, Fruits, Vegetables, Desserts, Fast Food,
Pizza and Recipe Cyber Greeting Cards. . . They're Fast Fun Free!


A UN environment panel said the world cannot sustain the tearaway rate of use of minerals, ores and fossil and plant fuels. It called on governments to "decouple" economic growth from natural resource consumption.

That's a joke, right? Like this is actually an Onion article? "Hey, you kids are doing a great job, getting bigger and smarter each year. But from now on I need you to do it without eating any food, ok?"

"Uh, ok, dad. You bet!"

I think we are going to increasingly see such Orwellian language from governments and media.

I believe this (Orwellian language) is a crucial point that very few people recognize. The reality is that statements by just about any individual or group have to be parsed before accepting them. I love "language" and it really bothers me that it is being destroyed.


Minor edits

I'm with you in my love of language and my distress at seeing it corrupted and perverted for Orwellian reasons. Orwell is my alltime favorite writer.

Shucks, I failed to defeat the abomination "demand destruction" on TOD, but all you can do is all you can do. I will fight the barbarians at the gate. I will fight them on the walls. I'll fight them in the market place, and as long as I can write I'll keep fighting.

We're all going to get rich doing each other's laundry.

Or selling each other insurance. (Arthur C. Clarke predicted that's what we'd all be doing by 2030. He thought robots/computers would be doing all the other jobs.)

Or as Kunstler said "We'll soon find out whether an organism the size of the United States can run an economy based on one family selling the contents of its garage to the family next door."

Where are the robots, now that we need them?

They're not ready.. we've been reading too much Arthur C. Clarke and surfing the internet and doing HL improvements, and the power grid would need to be significantly expanded to power all those robots.

They refuse to face the fact that growth should end and even if we don't accept that, it will end of its own accord. Trying for perpetual growth, however, will just bring closer the day of mass dieoff , species extinction, and misery.

Many here have discovered that perpetual growth is not essential for well being. On the other hand, we are on the road to overshoot regardless of what we do. It is too late and we are stuck on stupid.

What bothers me is how all the people in "important" places continue to have such a strange, misinformed view of the world. It may be inertia, but it's inertia on such a profound level that it threatens the very fabric of society.

To give just one example: we had a major bull run in U.S. equities from the early 80's to 2000 and perhaps an echo boom to 2008. It ended, of course, as all things must - but now the Fed, economists, bankers, etc., are all convinced that it must go on, forever and ever until the end of time itself! And if it doesn't, surely they have to intervene to make it happen!

This doesn't make sense. Why can't stocks trade at around the same level for prolonged periods? Why can't they go down?

The moment you ask the question, you answer it: of course they can. There's nothing natural about unlimited growth, in fact it's quite unnatural. But yet the Dow must be at 12,000, then 13,000, then 14,000, then onwards to 15 and 20 and 30 thousand, ultimately to infinity.

The same logic applies to house prices, or heck the price of anything, even gold and silver, which I happen to believe are in a very strong bull market at the present time.

The individuals in charge of immigration policy believe we should have 350, 400, 500 million, a billion Americans, all in the name of growth.

In fact, even a child could tell you this is absurd - yet this is the exact thing that we are trying to do.
We are trying to make everything rise, forever.

It's just staggering, really.

As you can tell, I think America has turned into an insane asylum.

O.S., relax: Three months ago (roughly) I predicted that the Dow Jones Industrial Average would be thirty percent below recent highs by July 4, 2011. Now I may be wrong or I may be right, but speaking as one with an M.B.A. in finance, I assert that stocks are way overvalued now. They will go down. Just look at the fifty year history of price to earnings ratios, and it is clear that stocks are way way overinflated. Over time, price earnings ratios revert to historical norms.

I picked July 4 just to be contrary. Many finance types look for a "summer rise." I'm looking for a summer slump in stock prices.

If they don't raise the debt limit, you will get your prediction except that it will be way too conservative.

Don't worry, the debt limit will go up. Republicans may bluff, and they may bluster, but they always end up voting to increase the debt limit in return for various concessions by the Democrats.

Politics rules. And in the U.S. we still have the politics of compromise.

This could change.

It would be interesting to see what would happen if the Democrats didn't fold, because in many ways the Republicans want the debt limit increase more than they do.

After all, only the Navy is Constitutionally mandated.

Well yes but my point is that it's quasi official policy of the Fed that the stock market must rise forever. I'm not joking or making this up, Bernanke honestly believes that if he artificially induces the stock market to keep rising, this results in a "wealth effect."

The corollary of course is that they can't let the stock market stay steady or drop, because that would mean no more wealth. So they inflate until the bubble bops, and then they do it again.

I mean, they honestly believe that rising prices equals wealth. This is not trivial stuff, it's insanity.

One can only hope that sometime down the road, people come to the Fed who care more about it's actual stated goals, such as mainting monetary stability, than making stocks rise until they can't and then keep on doing this forever like Sisyphus.

In the olden days, when the stock market went up, that was a reliable sign that the economy was going to get better. Ben wants the economy to get better--so of course he wants the stock market to go up.

In recent years, stock market fluctuations have had less and less to do with forecasting the direction of the real (nonfinancial) economy.

The economy has become a cargo cult..........

It's just that capitalism's modus operandi of production for profit, MCM' (money -> commodities -> more money, i.e. costs of production + profits) depends on growth. Without growth, it's impossible for the capitalist class to keep making profits for long.

But capitalism (even if it includes safeguards such as minimum wage, EPA, etc.) is associated in their minds with freedom, democracy, etc. and is assumed to be the universal end-all of political economy in the same way that the kind of democracy we have is assumed to be the highest form of political organization. So the notion that capitalism won't go on forever doesn't compute for them.

That's my take, anyway. I mean, I'm not suggesting they think it out this way, but it's implicit in their notion of 'entrepreneurship'.

Capitalism was a great tool to get rid of feudalism; it utterly destroyed feudalism, just as much as gunpowder did. But as Karl Polanyi pointed out in THE GREAT TRANSFORMATION, capitalism eventually lead to making commodities out of everything--labor, in particular.

Capitalism can exist in slowly growing societies; see example those of the Italian Renaissance cities, where capitalism co-existed with minimal growth for hundreds of years. Indeed, many capitalistic cities have declined over time, yet the spirit of capitalism is still the driving force in these economically declining societies (insofar as city-states were true societies).

I see what you're saying. That's a good point: the US economy could contract while remaining a capitalist society in a capitalist international system. But it would involve American capitalists making profits through MCM' in dependence on outside markets. That's why 'American' multinationals are nowadays interested primarily in China (Bernie Sanders presented some quotes from executives exemplifying this in his faux-filibuster speech), that's where the growth is and is expected to be in the future.

But that the international capitalist system were to continue for a century without growth seems to be impossible, especially considering the high levels of private and government debt. I may be wrong, of course, but that's what I gathered from what I've read of the history and theory of capitalism.

Look, for example, at the history of capitalism in the city-state of Venice. Venice declined for roughly 400 years after its peak, but it still remained relatively (compared to surrounding cities) prosperous--and totally capitalistic.

Many of the Hanseatic cities of northern Europe, which benefited from early capitalism, declined over a period of hundreds of years. The cities are still there, some of them pretty prosperous, despite their long history of decline.

Cities in the coal country of Britain have declined during the past hundred years, but they are still capitalistic (though with much welfare) and show no signs of going away. Similarly, many port and ship-building centers in Britain have declined for more than a hundred years, but they are still part of an ongoing capitalistic society.

I think I understand. But where did the Venetian capitalists' profits come from? I assume that they didn't operate for 400 years steadily making losses in their enterprises. This is no trivial question and it applies to the capitalist class in every society which has one. The same applies to a firm: if a firm is making steady losses and doesn't foresee getting back to profitability, it's (a) unsustainable, and (b) better off folding. Likewise for the MCM' approach as a whole.

Venice used to be a commercial empire. Now they sell glass trinkets to tourists. Capitalist profits built the pallaces in Venice hundreds of years ago. You can see similar stories in other great city-states of Italy that flourished c.1300-1600 but then declined--all of them capitalistic, but none more so than Venice, which once had a considerable navy fleet, not to mention famous patrons of the arts.

Let me be more clear. There are two issues here:
1. When you speak of decline, do you mean relative to other cities (certainly Venice is no longer the most powerful political entity in Europe) or in absolute terms (I would bet that the population and economic activity in Venice are higher now than they were at the height of its relative power). Relative decline is a red herring.
2. Where, _literally_, did their profits come from? When they were trading, the profits derived from being the commercial center, which included controlling the trade with the Levant. Now, think about the precious metals involved in running such an operation. Venice wasn't getting its currency (or its stones) from thin air: it was, for example, coming from the other parts of Europe which were buying the pepper the Venetians were trading in. Of course, you know this is what Venice's commerce was about, a form of arbitrage backed by military strength. But the point of all this is that Venice couldn't keep making profits this way unless one or both of the following were true: (a) other areas were being impoverished, to which there's a limit, or (b) there's an overall increase in the supply of currency, goods, etc. (i.e. the _overall_ economy in which Venice is operating is expanding).

What I'm saying is that it's impossible for there to be sustained profits in the system as a whole (of course it's possible for some firms to make profits and others to make losses, but investment assumed an overall return on capital) without growth (it can happen for a while, of course, but only in so far as there's wealth in other sectors which can be drained to the capitalists) because you can't impoverish the workers beyond a certain point.

The answer is quite trivial - the profit came from a central bank with an expanding money supply* and from expanding resource use (capital = land, resources (=timber, metals, oil, etc.) and labour or other means of production (assembly lines, smelters,power plants, robots, etc.). An expanding money supply's buying power is then moderated by resource use, i.e, an increasing amount of demand and money chasing a steady or shrinking supply of product means increasing prices - but if resource and product supplies keep pace with demand and money supply then inflation is held in check and there is price stability*. The reader can then figure out the remaining scenarios.

*note : there is some level of deception in the reporting of company profits. This issue is well known and is becoming increasingly commonplace as resource use is being constrained. Where do you think almost all the money from the ECB/U.S Fed reserve bailouts went ? Mind you the real intent is to maintain stability of the financial system (or is it?). This specific issue is worthy of greater study and in general is somewhat unpredictable.

*note 2 : prices are always subject to the frequent irrational exuberance or apathy of the markets - i.e, the dot.com bubble and the tulip bubble in Holland in the 17th century, and the 1929 stock market crash, among others. This factor is highly unpredictable, and can rapidly appear or change course..

One way to shape demand is by controlling/influencing the employment rate and wages, and this one of the main things central banks are supposed to handle. High unemployment generally moderates inflation, but only if money supply is kept in check along with production of goods. If money stops circulating or demand falls off from say, an aging population and decreasing or zero population growth, then deflation can happen in an age of highly automated mass produced goods.

Oil will definitely not be one of these cases - a larger demand from an increasingly sedentary and aging population, and increasing demand from an Asia with more money, combined with declining overall oil production worldwide can only mean one thing - oil prices will steadily climb.

Is the capitalist scheme sustainable ? That issue has already been discussed here and other 'limits to growth' type websites and books.

It called on governments to "decouple" economic growth from natural resource consumption.

This reflects the statement by Robert Solow, Nobelist in Economics, that we can "...in effect, get along without natural resources."

Hard to believe that anyone could be this far out in la la land.

Solow is not alone in left field among economists. Many, perhaps most economists, share his views on natural resources.

Of course, they are wrong--but they are the conventional wisdom at present.

In the 1990s we were supposed to get rich doing each other's web pages. Now we are apparently supposed to get rich selling each other "content". Since the few people who do have talent (be very grateful that you have never heard my singing) can make copies instantly for nearly free, that idea seems unlikely to work.

Getting rich selling each other organic produce will work slightly better until the first drought, then the customers die, or find a more reliable source, undercutting you in the long term and forcing you out of business. But farming, whether you call it permaculture or not, uses natural resources, so fails to meet Solow's criteria anyway.

But farming, whether you call it permaculture or not, uses natural resources, so fails to meet Solow's criteria anyway.

I can't argue that farming doesn't *use* natural resources, but a key distinction is that it can be done without *depleting* natural resources.
This, of course, is the concept of permaculture, but that is not the only way to do it.
The real problem is, that if you are not using and depleting resources (primarily manufactured fertiliser, fuel and petrochemical based pesticides, but also sometimes non-renewable groundwater) then the yields typically drop by half, and if you give up mechanical equipment the labour input goes up dramatically.

So it can be done without depletion, as long as you are only trying to feed less than half (possibly much less) as many people as you are today.

This will be the likely outcome of declining fossil fuels.

The real problem is, that if you are not using and depleting resources (primarily manufactured fertiliser, fuel and petrochemical based pesticides, but also sometimes non-renewable groundwater) then the yields typically drop by half

No, they don't, at least, not if you are actually applying regenerative practices. It would be really good for you anti-natural/regenerative ag people to update your belief systems to match reality.

Regenerative Ag outperforms conventional and can sequester up to 40% of carbon emissions: http://www.ifoam.org/growing_organic/1_arguments_for_oa/environmental_be...

Imperfect, but better than FAU (Farming As Usual): http://www.sciencedaily.com/releases/2011/01/110113131427.htm

Multi-nation analysis: http://www.independent.co.uk/news/world/africa/organic-farming-could-fee...
An analysis of 114 projects in 24 African countries found that yields had more than doubled where organic, or near-organic practices had been used. That increase in yield jumped to 128 per cent in east Africa.

Etc. Like any process, there are myriad ways to do it and myriad ways to do it poorly. Done well, the yields should be at least equal, small- or large-scale. The additional gains from not poisoning the environment and ourselves, using less water, creating jobs for the unemployed (particularly as we de-mechanize/simplify), building local economies, building resilience into the food system, and more, make it a rather foolish move to not change.

I've done so much, with so little, for so long, that now I can do
anything with nothing.

Re Global consumption of natural resources possibly tripling by 2050: It seems impossible to me that humanity could ever pull this off, even if it wanted to. For many natural resources, some in the Oil Drum community have argued that we have already grabbed all of the low hanging fruit, e.g. easy to extract oil, easy to mine minerals, etc. Extraction costs are going to go higher and higher and, in some cases, the quality/quantity of the target resource may decline markedly despite throwing more and more money at producing it. Just as oil demand corrected when it hit a certain price, isn't this just as likely for things like copper, aluminum, etc. ad infinitum? In other words, won't production costs price natural resources out of reach for many who would want to pursue continued growth? It'll just become too darned expensive.....

Just a reminder that interested readers can review a century's worth of US and global production as well as prices for 86 important mineral resources at the US Minerals databrowser.

Here, for example, is the chart for iron ore which shows the huge jump in production and prices due in large part to China's ravenous demand:

When folks put out statements about natural resource consumption that are completely devoid of data it's time to go have a look at the data yourself and come to your own, data-backed conclusion.

Happy Exploring!


Well, your chart shows production has tripled in the last 40 years so there is a precedent...

is the ore adjusted for change in grade or is it straight tonnage?


I wonder if traffic is more normal upstream of Memphis, yet.

U.S. economy could face big bill if traffic stopped on river

If the lower portion of the flooding Mississippi River is closed to ships, the U.S. economy could face a bill running into the hundreds of millions of dollars a day.

The Port of New Orleans was told Thursday by the Coast Guard that a river closure between the Gulf of Mexico and Baton Rouge to deep-draft ships was possible as early as Monday. Ships approaching the river from the Gulf and approaching Baton Rouge were warned of the possibility.

Hundreds of millions here, and Jeff Masters tallies over 14 billion total from US weather disasters so far this year.


Makes the Lloyds of London tally on the earthquakes pale. (top post above)

We've just got to quit building our cities or growing our food where storms, droughts and such can get them.

Ron Paul said this morning that the Fed Gov should not help people impacted by flood, drought, etc. essentially arguing, for example, that FEMA should be abolished. Just let those people along he Mississippi eat cake. Well, that would go along way to accomplishing what you have in mind as people would have to get insurance, move or stay away from flood, fire, earthquake areas in the first place. Goodbye California!!

Going forward, this might be a smart policy considering increasing frequency of disasters and lack of resources available to the Fed.

The hypocrisy is people like the Gov of Texas complaining his state is not taken care of. This, after he was talking about possible secession. Well, goodbye Texas and good luck. We don't have any money left to help you out.

The frequency of these disasters is related to global warming and is a cost thereof. In essence, it is an externality of energy use, which is why any remuneration should come out a fund created by taxes on carbon. Let carbon pay for the costs that will be incurred by more and more of us going forward.

Higher insurance rates is also a way of getting people to pay for their own decisions. But if gov is going to bail people out, then the insurance rates probably won't reflect true risk adjusted costs of living in a flood or fire zones, for example.

Good point, and before anyone ever comments on how renewable energy is too expensive compared to cheap oil, the cost of all these externalities should be taken into account.

Of course the degradation of land used to mine rare earth elements as well as energy embodied in the renewables etc should be included in the comparison, but I still think renewables would come out far ahead.

If something is not being used sustainably, it is almost certain that the full economic cost is not being paid.

I hope you realize that my comment above was tongue in cheek.

Much of this years disasters, the floods in part and the drought of the southwest, was predicted yrs ago by the IPCC. But we are unable to say it is caused by climate change. That's getting old. In my mind, it's here, the questions are only those of severity.

Returning to your comment, I'm not sure sure a carbon tax could cover the claims, though the concept is the only viable one around IMO.

Looking at just federal flood insurance, I've long been in favor of abolishing it. As evidenced with this years floods and the frequency interval rating, (10 vs 100 vs 500 yr) the flood plain maps should be redone. The A areas of the map might still be adequate, but B and C is outdated. Probably no one pays them any mind, not when their aesthetic considerations take hold.

Right, are you getting it tstreet? It's over for us politically speaking.

On one hand you have the Fed / federal government bailing out everybody with funny money. On the other hand a guy like Rand Paul wants to do away with everything altogether.

Nobody thinks "let's tax carbon to pay for the damage it creates" as you mention. It's nowhere on the table! Nowhere!

I mean, it's actually unreal at this point. You have to remind yourself when you wake up, this is what's happening.

Democracy fail.

The really bad thing that could happen is failure of the Old River Structure or the Morganza Spillway. The Old River Structure nearly failed in 1973, and from what I read this flood is more severe than the one in 1973.

The Corps of Engineers and the Mississippi remind me of Cnut and the tide.

Indeed. Canute knew the limits of his power, and the Corps of Engineers does, too. They admit that they will eventually lose their battle with the river. They don't know if it will be next year or a thousand years from now, but they know nature always wins in the end.

Funny thing - I remember the story told a different way - Canute got so caught up in the flattery, he actually thought he could turn back the tide. Then failed, and made the speech about nature overcoming man (paraphrasing).

It's often misunderstood/misremembered that way. But the story is pretty clear: Canute was reproving his courtiers, not caught up in their flattery. He knew his limits, and so does the Corps of Engineers.

Canute was probably the best of the Danish kings in Britain.

Cnud reigned for 19 years of the 26 or so years England was ruled by Danish kings. His father ruled for a few weeks, and the last seven years were split between his sons Harold and Harthacnut.

Harthacnut spent most of his time trying to hold onto Denmark and Norway, and Harold was probably a puppet with his mother Ælfgifu the real ruler. So the competition for "best of the Danish kings in Britain" is not exactly close. But Cnud (ruled 1016-1035) was arguably the best king of England between Alfred (ruled 871-899) and Henry II (ruled 1154-1189).


Jeff Masters writes about that today.

Excellent article.

The side by side flow depictions, historical meandering vs the '58 Corp diagram, are great.

I agree, good article. Jeff quotes from an excellent article on the history of flood control on the Mississippi written by John Mcphee. Mcphee is one of my favorite nonfiction writers, one book on geology where he travels with several geologists. One, none other than Ken Deffeyes.

Jeff Masters's article is up-to-date, but the "Down with Tyranny" blog a week ago also used John McPhee's essay to explain the situation on the Mississippi River above New Orleans with many useful illustrations and diagrams.

That's the McPhee book "Basin and Range". In the book you learn that "Deffeyes" rhymes with "the maze" and you get a page summary of why Geology courses in college are referred to as Rocks for Jocks.

Which gets to a larger point of the lack of equations for oil geology of the simple sort that I work out. I don't use anything fancy by way of math and have no specific training in geology. Of all the engineers and scientists who have gone through the system (i.e. "the oil patch"), you would think that a few would come up with something special. In the book, McPhee relates a colleague describing Deffeyes as

"an intellectual roving shortstop, with more ideas per square metre than anyone else in the department--they just tumble out."

But no one really has come up with anything of any value, notwithstanding the HL approach that Deffeyes advocates in his books. This is odd because you would think that of those people whose life revolves around oil that they would stumble upon something accidentally. But of course that doesn't involve money, and it certainly wouldn't impact the bottom line, which is to make profit.

You see, that is the whole point.

Anything of any novelty in the commercial world really has to make money. Consider that when it comes to making money, engineers and scientists can become very creative. Take the case of the geophysicist J.P. Burg who developed the useful mathematical analysis and prediction technique called Maximum Entropy Spectral Analysis. This made him lots of money because he actually used it to predict the location of the first oil well he tried the technique on, calling it Rock Entropy #1. That was back in the mid 1960's (see The Oil Conundrum for a full account).

So that explains why the same clever geologists never applied similar techniques to estimating something as socially practical as global projections of oil availability. I use the concept of entropy in my own analysis, while they don't even give it a college try, even though they have Max Entropy Spectral Analysis in their toolbox, and this is arguably more difficult to understand than anything that I have come up. They don't because it doesn't make them any money. Rockman will tell you the same thing, they all know about the PO thing but don't say a thing to the public.

So place this in the context of the oil executives getting grilled on Capitol Hill recently. Not one of our political leaders is asking them to supply the public with the intellectual knowledge that they have amassed over the years. We know they have it and it would be amazing if they couldn't have figured out some of the same things that I have uncovered over the last few years. Yet they are now saying that oil is getting harder to find and it is not their fault and to be taxed higher or not given subsidies would not be fair.

I would say to the oil execs to please spare us the crocodile tears now, because you guys had years to educate the American public about the situation. We can give Deffeyes and Hubbert some credit for trying to spread the word yet it was the oil companies who didn't contribute one iota of knowledge to our collective wisdom. And now they are trying to get off scott-free. But that is the way that capitalism works, and what more can we expect? The concept of lack of intellectual curiosity and a devotion to the bottom line screwed the pooch. StepBack wil step in at this point and state that "what the hell did you expect?", but I had to rant on this because the topic is so timely with the head honchos getting grilled.

You can say the same thing about constructing dwellings on flood plains or any other topic that has the hint of inevitability, eventuality , and finality to it. We don't talk about it because that is not looking at the bottom line.

McPhee specializes in non-fiction on topics such as geology and meandering rivers. He takes an intellectual look at some rather obvious natural science topics and gets people interested in thinking about what it all means. That's the intellectual curiosity that is totally missing from all the indoctrinated oil patch honchos and munchkins and what has the American public believing in the default info they have been fed.

The John McPhee essay "Atchafalaya" is collected in a volume called Control of Nature. Basin and Range was the first collection of his geology essays and is amazing in its own right.

Several years ago I read a paperback fiction novel, by Clive Cussler, called Flood Tide, that was centered around a plot by the Chinese to move the Mississippi to the Atchafalaya.

They had bought all the land around Morgan City, and built a new port there, first. The plan was then to sink a large ship and some barges in the Mississippi to back up the water and then blow the Morganza

I'm sure someone in the real world must have looked at this possibility.

According to CNBC, the last time that the Morganza Spillway was opened the floodwaters damaged the Colonial (product) pipeline.

US Army May Open Key Louisiana Spillway

Earlier this week, the Corps issued maps showing that New Orleans, Baton Rouge and other cities along the Mississippi would be inundated if the Morganza was not opened.

Jindal, a Republican, and New Orleans Mayor Mich Landrieu, a Democrat, have both said failure to open the Morganza could lead to flooding in New Orleans.

In addition to threatening densely populated areas, lower Mississippi flooding could force shutdowns of as many as eight refineries and at least one nuclear power plant alongside the river. The refineries make up about 12 percent of the nation's capacity for making gasoline and other fuels.

La. spillway to open, flooding Cajun country

About 25,000 people and 11,000 structures could be in harm's way when the gates on the Morganza spillway are unlocked for the first time in 38 years....

The opening will release a torrent that could submerge about 3,000 square miles under as much as 25 feet of water in some areas but take the pressure off the downstream levees protecting New Orleans, Baton Rouge and the numerous oil refineries and chemical plants along the lower reaches of the Mississippi.


The river has been trying to shift west for decades now. Ecologically it should. The sediment and nutrients would filter through the bayous leaving less to cause dead zones in the Gulf, and at the same time build up the subsiding land.

Australia spends 2.4 times more on roads than on rail

Australian 2011 budget allocation road/rail will not mitigate oil crunch

Sydney now beyond point of no return

I'm curious what you all think about Dave Cohen's recent post on how oil production is not going to decline much after peak and therefore the world economy will not experience a sharp decline but rather very very slowly struggle through some slow periods.

Peak oil versus peak exports:

Egypt, a classic case of rapid net-export decline and a look at global net exports:

A slow decline is better than a fast one, but it hardly means the world economy won't suffer. The laws of supply and demand hold that something always must give: either the price, or the quantity reaching the market, or both. We know that quantity won't give once there is a hard ceiling on oil production. That means the price must become extremely volatile. That cannot be good for the world economy.

This article illustrates the likeliest of the establishment responses to the essential energy predicament. The concept of 'decoupling' economic growth from resources is portrayed as doing more with less, and that is the fallacy that hardly anyone in the world recognizes. Aside from the 'something for nothing' quality of the statement, Jevons’s paradox shows this to be exactly the wrong view of reality. We can't do more with less; it's not going to happen that way. What we need is to do less period. Less people, for example, would bestow an immediate benefit. This is probably the most unpalatable position imaginable, and politically impossible. I don't see any political solution as realistic, but this concept is particularly unlikely as a viable way of addressing the issue. What do I think will happen? If I were a betting man, my experience of human nature suggests the actual ‘solution’ will involve Dirty Deeds, performed in the middle of the night under cloak of secrecy.

This article illustrates the likeliest of the...

Errr, just which article does this illustrating? I suppose you are talking about the article by Dave Cohen, linked to by BR above but I can't be really sure since you did not post it as a reply but as a totally new thread.

Folks, please don't make us guess. Whether referring to an article posted by Leanan above, or by someone else, please give us the title of the article or some hint as to which article you are referring to.

Ron P.

"The concept of 'decoupling' economic growth from resources is portrayed as doing more with less, and that is the fallacy that hardly anyone in the world recognizes. We can't do more with less; it's not going to happen that way. What we need is to do less period...... I don't see any political solution as realistic, but this concept is particularly unlikely as a viable way of addressing the issue."

In other words it is a predicament, not a problem. As long as the political class views it as a problem - they will increasingly be forced into "Orwellian language"

Your comment that we need to do less period is right on. Greer's blog post this week is an emphasis of that point.

Texas, that all very good and I agree we all need to consume less. But there is a very serious problem with this idea, one that no one seems to consider at all. Worldwide, billions of people are employed producing this "more" that we all need to do without. If we do without all this stuff those billions will be unemployed.

That has already started to happen. The official unemployment rate in the US now stands at nine percent and the unofficial rate is probably twice that. That is a direct result of people getting by with less. And this can be traced, in my opinion anyway, back to peak oil. In the US of A peak oil was in 2005. That year petroleum products supplied, (consumed), in the USA was 20,802,000 barrels per day. Last year it was 19,148,000 barrels per day. That is a drop of 1,654,000 barrels per day or almost 8 percent.

So as we are forced to do with less and less on the downside of peak oil we can expect to see more and more people unemployed who used to produce all that stuff we are going to be doing without.

Ron P.

And this can be traced, in my opinion anyway, back to peak oil.

Suggest a possible friendly amendment to the above. Peak net energy preceded peak gross by as much as thirty years. And the beginning of the deceleration in growth of net energy came much before that. It is net energy (after all costs of extraction, refining, and transportation to points of use are subtracted from the gross) that runs the economic work in support of consumption and what little (truly useful) hard asset production we do these days. Financialization and monetary/financial assets are just smoke and mirrors meant to hide the fact that we have been in deceleration since at least the seventies, and in decline since the late eighties. All of the economic fallout we see derives from this phenomenon. But now, the peak of oil extraction rates will exacerbate the predicament even more.


Ron - My frustration matches yours. Sometimes when I chat with folks about the difficulty in reducing consumption they immediately argue all the reason why it's possible. They miss the point. Sure, we can raise fuel taxes and cut consumption. We can eliminate a lot of other energy intensive non-essential activities. But what do we do with the collateral damage? And that damage being the newly unemployed. There was much wrong with the whole sub-prime housing boom. But it did provide a lot of jobs. I go back to an illustration I offered months ago: as you drive down the road this weekend running your chores make note of every business and decide if society would lose greatly if that store were closed next week. Would life in this country truly suffer if half of all the Starbucks and all other fast food shops closed up? If half all the restaurants closed up? If half the clothing shops closed? If half the amusement parks closed? If half the movie theaters closed? If half the dry cleaners closed/ The list really is endless, isn't it? Not that all these operations don't add convenienc? but our lifestyle would still be rather fat and happy without many of them IMHO.

We're not talking about serious cutbacks: cutting our heating/cooling demand 50%; cutting our gasoline consumption 40%; cutting our air travel 30%; etc. Many would consider those as truly painful developments. But not having to drive an extra 20 minutes to pay $5 for a cup of coffee. Yet cutting out all that "fat" would represent millions added to the unemployment rolls. And that's where the reductionists lose sight of the political reality of the situation. It isn't that such reduction couldn't be done. But who's going to cut those folks off from a livelihood? And no....we're not going to turn a million burger flippers into solar engineers. If we're willing to be bluntly cruel: a large portion of society cannot sustain themselves without the wasteful consumption of energy. Thus "wasteful" may not even be the proper term. Such efforts do support a lot of folks.

As someone just pointed out: this is more of a predicament to deal with than a problem with some solution hiding out there.

Virtually everything proposed here is not possible because of political reality. If political reality were the criterion for proposals/comments here, the site would shut down.

There will be less oil and other resources available for our economy going forward. The question is not whether we will cut back but how. The fact that this will increase unemployment is a given if we continue our current economic system. So, going forward, it might be useful to figure out what kind of economic system we could have that would employ people given cutbacks in production and consumption.

To simply say we can't cut back because this will cause unemployment is to say that we need to destroy the planet in order to save it.

So, yeh, cutting back on our increasing destruction of the planet is a political non starter.

Part of the problem is that we have an economy where people are either employed or they are not. Most of us work for someone else. It is all or nothing. When consumption falls, people get laid off as opposed to a system where there is job sharing that keeps employment but spreads the wealth around a bit thinner.

There is not going to be a happy solution to the problem. But I think there is a better approach to the problem than is dictated by the nature of our current economy.

To simply say we can't cut back because this will cause unemployment is to say that we need to destroy the planet in order to save it.

I did not see where anyone claimed that we can't cut back. Actually we will have no choice in the matter. We will cut back but that will not save the planet.

So, yeh, cutting back on our increasing destruction of the planet is a political non starter.

No, no, no, no, that's where you have got it all wrong. We will in no way cut back on the destruction of the planet, we will dramatically increase the destruction of the planet. We will cut down the last tree for firewood. We will kill all the animals to feed ourselves, we will even eat the songbirds out of the trees.

But you are correct there is not going to be a happy solution to the problem. In fact there is no solution to the problem. The future will dictate to us not vise versa. Every person will be in a fight for survival and will not be concerned with saving the planet.

Ron P.

Dang Ron...wish you would stop sugar coating it. Sometimes you almost make me feel a tad optimistic: you really think we'll ahve some songbirds left to eat when the time comes? LOL

Yeah, Ron, you skipped the part where folks start eating each other :-0

ts - if you're referring to me I didn't say we can't cut back voluntarily because it would cause unemployment. I just said it won't be done. Aside from letting the free market do it the only other option would be for the political powers to do so. And that was my point. The only way for reductionists to have their way is for the govt to force the change before the market does. And the govt won't be able to do so IMHO on the basis of self preservation by individual politicians.

So job sharing, eh? Sounds good on paper. So you'll have a coffee server do split shifts with a production line hand at Ford Motor. Or have the 28 year waitress relieve your teller at the bank...the same waitress who can't balance her check book because she "ain't into that math thing". I assume you're ready to share up a big chunk of your paycheck to the sales girl at Saks. Or maybe two minimum wage earners will do split shifts and willing settle for bringing home less than $150/week.

Just teasing you a bit. I see the value of your thoughts of shared suffering. A truly noble goal for a generous and kind society. But that ain't us IMHO. First you'll have to tell me how you'll force millions to share the suffering. Maybe you know a lot more generous folks then I do. I know a lot more folks trying to get 60+ hours of work a week then looking to cut back. In fact, I can't think of a single person whose looking to cut back at all.

And again I'm not saying what will be won't be. I just don't expect any sort of organized and just reconciliation with the realities of the coming market place. Millions will truly suffer and many millions more won't be unable to lend support either directly or through a govt unable to raise the trillions needed to do so.

Yes...I see a very cruel future. Not because there aren't options to lessen/share the pain but because they won't be implemented voluntarily.

Any program that gets established develops a constituency. The War on Drugs is madness and counterproductive, but thousands of people draw pay in its pursuit and want it to continue. Not only the War on Drugs -- the two and a half shooting wars not only employ service personnel but support industries and local communities. The War on Terrorism's Homeland Security is a farce, but a well-funded one that employs thousands.

Ideally all these wars should be brought to a close and replaced with diplomacy, treatment, and detective work. But the unemployment rate, realistically, is already about 20%. Bring home all the unneeded warriors -- to what jobs? The wars are made-work. Close the prisons, and then both guards and the formerly incarcerated will need jobs.

Unhappily the US prison system as a whole has become made-work feeding off the drug war. About the only industry remaining in upstate New York is the prisons built to incarcerate minorities from New York City ghettoes. Incredibly, it is coming out that behind the repressive immigration laws in Arizona and now Georgia were private prison entrepreneurs looking for bodies to fill their facilities. The Arizona prison proprietors are reported to be furious at the Feds who chase border-crossers back to Mexico, denying them what they consider their "product."

You can't do only good, especially when you've done bad to begin and become dependent on it.

Part of the problem is that we have an economy where people are either employed or they are not.

Not quite true, we also have part time jobs. Whats interesting is in the UK we see headlines proclaiming "unemployment down", when you look at the actual figures you find the number in full time employment has dropped and part time has increased. This isnt a choice for workers, it's a case of take it or leave it. Part time obviously pays less and has less job security.

I find whats going on in the economy fascinating, people are paid less, we have high inflation, no intrest on our savings, pension systems look none too stable, failing businesses, high national debt. But everytime you turn on the TV officials are talking about the recovery, I'm not sure we've seen the colapse yet.

Is this really the beginning of the end? Or are we just going through a rough patch?

Not quite true, we also have part time jobs.

Part-time in developed countries other than the US is a different proposition, of course. Part time in the US and you can lose access to health insurance, company contributions towards pension savings, you begin to be desperate about how to pay for the kids' years in college. Outside the US, you still have insurance (or at least equivalent access to the health care system), the pension system has a larger public component, as does higher education.

Recalling my grandparents' stories about the Depression, I'm of the opinion that we certainly haven't seen the collapse yet. What makes me nervous is that a lot of what the US government has done looks like papering over the problems rather than actually addressing them.

What makes me nervous is that a lot of what the US government has done looks like papering over the problems rather than actually addressing them.

Looks like? The Federal government alone is directly borrowing and spending 12% of GDP annually. When they are forced to reduce borrowing, that much plus spinoffs will disappear overnight from the economy.

There's borrowing, and then there's borrowing.

Put the tax rates and the DoD budget back to where they were in 2000 and two-thirds of the deficit goes away next year. Do it now.

With respect to the god-awful amount of money they poured into the financial sector, if they had decided to let the TBTF banks go under, then borrowed $700B and used it to create seven regional banks, each with $100B in capital, and each charged with making real loans for real business purposes and barred from various kinds of speculation, I wouldn't be particularly worried about the added debt. Nor would I be concerned about what would happen when they didn't borrow $700B. Instead, of course, they bought pretty-much worthless paper from the TBTF banks, without obtaining any commitments to the real economy...

Have you ever heard of propaganda?

Yes, this really is the beginning of the end. Plan accordingly. The good thing is that the various bailout and government schemes are giving us some time. And they will continue to give us time.

I am capitalizing on the artificial stability by relocating and focusing on hard assets and local connections.

So although I always criticize the federal government I at least have to admit that they are giving us doomers some relief before the endgame.

See item "I" on list.


I'm beginning to feel that we do indeed live in the realm of cartoon physics presently.

Regarding unemployment, I have the following thoughts.

First, I've always thought that Obama & Company really missed the boat with the Stimulus Package. The government spent an enormous amount of money fixing roads and bridges. Now some of that work was probablly necessary but really, this was just BAU, developing infastructure for automobiles. Imagine the following comparison: On one side, how many pieces of heavy equipment, each with a fairly well paid operator can be hired for $1 million. Conversely, what if we invested in energy conservation? How many construction workers, each with hand tools, could be hired for $1 million? Its obvious that the latter scenario provides many more jobs for the same investment. That latter investment has much greater long term benefits too.

Here's some energy related job costs I found somewhere (sorry for the lack of a link): "For example, Gavin Newsom, California’s Lieutenant Governor, provided the following about investing in various energy resources.
$1 billion in coal = 870 jobs.
$1 billion in a nuclear plant = 1,500 jobs
$1 billion in solar energy= 1,900 jobs
$1 billion in wind energy= 3,300 jobs
$1 billion in energy efficiency retrofits =7,000 jobs."

We haven't, in the last 3 or 4 decades, had a serious discussion in this country about the value of labor beyond the generalized goal of replacing labor with machines (and the energy to run those machines) and calling it "efficiency." As a result of that drive towards efficiency (actually towards corporate profit, consolidation and control), we have pushed people off the farms, out of the factories, out of small businesses and into marginalized existence. As with FF energy, our labor policy has caused huge external costs. Just like the issue of PO 15 years ago, this ideology really needs to be re-examined from the ground up.

I've been struck by the difficulty this group (myself included) has had in imagining the future and in formulating specific, realistic scenarios beyond individual survival strategies. One way to identify the possible is to remember the past. What was it like in 1970 when we used half the energy per capita as we do now? We certainly were more focused on local conditions and local solutions, socially and economically. Despite all the changes and efforts since then, there are tremendous needs in our society that aren't met by our current corporate/governmental structure. Just think of all the social work that religious groups do in this country on their own. That type of effort is likely to be the glue that holds us together in the decades ahead. These are efforts at rebuilding community. We easily could find productive work for all the unemployed if we could access all the surplus capital,wasted consumer spending and skewed resource allocation that our still affluent society possesses.

The other way to help imagine the future is to rigorously examine our assumptions about what is (im)possible. If every major energy project and future scenario had a labor impact statement associated with it, assessing the jobs produced per investment dollar, we would collectively begin to understand what the real costs of abandoning large segments of our society and shift our priorities.

The spector of mass unemployment, matching or exceeding the Great Depression will, in the end, force a fundamental restructuring of our economic system. Before there is mass extinction, as some have suggested, there will be the removal of existing power structures. Whether we can transition to a truely efficient labor market with workable institutions or we disentegrate will depend on how we engage in this debate. Perhaps TOD can participate, especially as it relates to the relationship between labor and energy.

It's malinvestment. And like you said, we aren't magically going to turn burger flippers into solar engineers overnight.

But without market signals (and no, I'm not a market fundamentalist) the transition cannot happen. These businesses and enterprises have to disappear eventually, and the burger flippers and baristas have to get new skills.

But if central finance and central government keep printing and bailing out and distributing, the transition never happens. The whole stinking edifice is supported even as it bankrupts everybody and consumes nature's bounty without rhyme or reason.

True, that's why we need to take more out of the system than we put in. By using the difference extracted from the national economy we can divert it into our own local economy.

Would life in this country truly suffer if half of all the Starbucks and all other fast food shops closed up? If half all the restaurants closed up? If half the clothing shops closed? If half the amusement parks closed? If half the movie theaters closed? If half the dry cleaners closed

That's been business as usual for years. That's why we have to drive so far to the few big ones that are left.

We need more, not fewer.

If we are not supposed to drive, we need our neighborhood shops back. There used to be a store half a mile away, no problem to walk to. It's gone. Now going to the store is a half-hour round trip by car, or about 2 hours by bicycle.

There would be jobs installing all that insulation and replacing all those drafty windows to get our heating and cooling demand down. Replacing old, inefficient lighting with LEDs will help here too.
There would be even more work building all the new railroads we need.
Just replacing all the short-hop flights with high-speed rail would achieve the 30% reduction in jet fuel and get you there as fast or faster.
The Internet has enabled a significant reduction in the need for business travel, and that trend is likely to continue. It has also reduced the need to print and mail massive quantities of paper.
The information economy can continue to grow, as we continue to improve our ability to move, store, and process more information while using less energy.

I live in such a walkable neighborhood (Highland Village in Highland Park in St. Paul, MN) that I have not used my car during the past week. Almost everything I need is within ten minutes walking distance, including several restaurants, the public library and recreation center, my doctor, my bank, my pharmacy, my supermarket, and even a tailor that I went to last week for alterations.

Of course, I planned it this way: I always wanted to live in a walkable neighborhood, and so finally I moved to one. Alan Drake brags about New Orleans, but I doubt that it is better than Highland Village.

I keep my car to visit friends and relatives that I cannot readily reach by public transportation, though I live on good bus routes. It has 241,000 relatively trouble-free miles on it and may last as long as my driving does.

andy - A valid model except for one detail IMHO: where does the capital come from to make these transitions? Remember we're talking about economic conditions that won't support maintenance of BAU. Your concept requires not only BAU to be maintained (you have to do so since it will take years to make the transition) but also even more capital to fund it. If the dry cleaners can't afford to pay for an extra clerk can they afford to build a store in your neighborhood? Remember we're talking about economic conditions that significantly reduce the number of $5 cups of coffee sold (and thus the salary of the person making them). And this situation would allow a Starbucks to be built in your neighborhood? It's good to remember what the basic problem really is. It's not the price of oil...it's the exportation of US capital to the oil exporting countries. For every $ shipped to Canada there one less $ in our country. Or at least that's the way it used to be before the fed starting inventing new money. Add that to the money we borrow from other countries and imagine how little capital we would have to work with here if such actions weren’t taken.

Just replacing all the short-hop flights with high-speed rail would achieve the 30% reduction in jet fuel and get you there as fast or faster.

I can't let this one go through to the catcher as it is a pet peeve with me.

We don;t need high speed rail to replace short flights, we just need passenger rail period.

The cost of building high speed (>110mph) as opposed to "express" (<90mph) increases astronomically, and the faster they get, the less energy efficient they are.

Trains will never compete with planes on time, but they don't have to - they need to compete with cars!
A fully loaded plane is actually more fuel efficient per passenger mile than a single occupant car.

So, in an energy constrained future (or even the present) the greatest benefit, to the greatest number of people, is to get them out of intercity cars and onto intercity (electric) trains. And if the trains are "fast conventional", then they will be affordable enough that people will do so. For those that feel the need to travel fast after wasting time in airport security etc, well, they will keep flying until airlines go broke. At that point, the age of speed is over.

For a trip from say, Birmingham Al to Atlanta, of 160 miles ( a prime candidate), the travel time difference between a 80mph (average speed of fast-conventional) and 110mph "high speed" will be from 2hrs to 1hr,30minutes, but the cost of the trip will likely have doubled.

The faster the trains go, the more expensive they are, and the less average people can afford to use them - they are like sportscars on rails - very fast and sexy, but...

Keep the speed moderate and they are cheaper, more energy efficient and more people will use them - all desirable features going forward.
And because they cost half as much to build, we can build twice as many of them - more oil saved sooner!

"A fully loaded plane is actually more fuel efficient per passenger mile than a single occupant car."

Depends on the plane, and all that....Plus, take into consideration the time delays waiting for the flight, check in, parking, where the airport is located, having to drive to and from airports, etc. plane travel is getting dumber by the airmile.

Passenger trains...not high speed, fewer trips, slower lifestyle is the answer. We travel to d*** much IMHO. Think back to childhood and the feeling of when going somewhere was an exciting big deal. It could still be that way with a deliberate lifestyle. If circumstances seem to push us that way anyway as decline unfolds, it makes a little sense to ease off on trying to keep BAU mindsets.


Hi Paulo,

Actually, as long as the plane is not a private jet, and is full, they pretty much are all more efficient than most cars (prius etc excepted)

The time wasting at airports doesn't figure into the fuel efficiency, though it does of course, reduce the time efficiency, especially for short trips.

And that's the whole point - the train doesn't need to be "high speed" to compete, it just needs to be there, be a moderately fast train, an express service, and run city centre to city centre, and it will be more convenient than the equivalent flight.

Wish they'd do that with the train on Vancouver Island. Do a bit of trackwork, and then have a train run Vic- Duncan-Nanaimo-Parksville -Courtenay.
IF it's faster from N to V than driving, who wouldn't want to avoid the Colwood Crawl?

Agreed that we travel too much, and I think Jeff Rubin's predictions will play out where air travel again becomes an expensive luxury - as it should be.


I agree with everything you just said. When I say we have to do with less I don't mean that it will be a good thing - I mean we really don't have much choice. And yes their will be more unemployment. The concept of the "job" may be on its way out over time. And yes it will be painful. We are facing a entropy crisis. Wish I could put a nice spin on it but I just don't see it.

You got it.

We will do less per capita as resources remain constrained. Not sure whether Jevon considered resource ceilings.

It also appears that the price of oil is being held steady at around $100 a bbl. Betcha Jevon did not predict the dirty deeds being done to hold the price of oil steady.

I am starting to become a conspiracy theorist. This $100 oil is not making sense. It either needs to keep going up until POP. Or it needs to go down if China is not requiring additional supplies as the media is reporting.

The holding at $100 plus or minus smells funny.

The fundamentals support a high oil price (over $80/bbl for sure by my best guess) and the investors are gun shy of another bubble since 2008 is still a fresh memory.

It's probably going to dance around $100 for a while yet before some dramatic event pushes the psychology either high or low, at which point it will proceed to overshoot in the direction of the push, either as low as $50/bbl or to new record highs which could top $200/bbl briefly.

r4 - Not picking a fight with you in particular but I always have to wonder when some folks say the fundamentals do/don't support some price. Granted I'm just a geologist so I have to keep it simple and thus I see the fundamentals completely supporting the current price of oil. The fundamentals IMHO: almost no one but the KSA has any ability to bring more oil to the market very quickly today. Many doubt even their capability but that's another debate. So the fundamental that determines what the KSA gets paid for its oil is what the KSA requires for its oil. If the KSA says it wants $110/bbl then the buyers either pay that price or they don't buy it. Of course a number of buyers might not be willing to pay that price. So the KSA has an option: lower the price or be satisfied selling as much oil as it can at $110/bbl. If the KSA is satisfied with their cash flow from that volume of sales then there's no reason for them to lower their asking price. In fact, given the common position that the KSA is seeing the beginning of the end of their reserves there a very good reason for them not to sell a larger volume. And since virtually all other exporters are producing full out the KSA can't lose whatever market share it has to another exporter.

So the fundamental seem to perfectly support the current price of oil: the oil exporters own the oil and are under no obligation to sell it at a price other than what they chose. The potential oil buyers can either buy at that price and profit from its refinement or they can't. If they can they buy. If they can't they don't buy. And even if the buyers start purchasing less oil as the world slips into another recession it doesn't mean oil prices have to be reduced. If the KSA is satisfied with selling, let's say 30% less oil then they are producing today, they can keep their price high as long as some buyers can afford it. Again, no other exporter can replace the oil that the KSA refuses to put on the market.

So again, the fundamentals seem clear: the KSA is selling their oil for a price they are willing to accept and the buyers are willing to pay. Pretty freaking fundamental IMHO. LOL

Roger that ROCKMAN. There is another fundamental even a TLAR engineer can understand. You cannot produce oil or anything else very long if the cost of production is more than the selling price.

EDIT: I understand we do not produce oil. That is just a convienient way of stating the problem.

You are right, of course, I'm just saying that I think that barring a lot of "investor class" money moving into/out of the market in a hurry I don't expect it to move up too quickly or to drop below $80/bbl any time soon.

I could have expressed that more clearly the first time.

r4 - I agree with you. Although I really try to avoid making predictions but short of a major global recession (including Chindia) I don't anticiate oil moving out of the $80-110 range anytime soon. I've been a n]biy surprised the higher prices haven't hit the economies harder but maybe it's still coming...just slower then the lst time.

I've been a n]biy surprised the higher prices haven't hit the economies harder but maybe it's still coming...just slower then the lst time.

My small business caters to the reasonably well off, and as much as you might think they continue to spend as usual when prices go higher, they actually do a pretty good job of segueing into a more frugal buyer. My product is in the mid-zone price-wise for its category, but it acts as a pretty good bellweather on the economy. In the 08/09 debacle I got hit hard, but hung on. Just recently with the higher oil prices projects are dropping off again. Any fuel price over 3.50 in CA and business drops off immediately (price now about 4.20 a gallon in our area). So I've noticed the difference but have also been surprised the economy as a whole seems to be plugging along pretty good. However, the stock market and commodities have leveled off recently, so maybe there is a delay until quarterly's show the higher fuel/oil price is pinching in on profits.

Earl - Not surprising to hear. Back in the '08 collapse there were a number of factors, such as the sub prime melt down. Folks have debated the cause of the recession as though it was predominantly one factor or another. Obviously to me it was a combinatioen of events. Maybe the best analogy is a house on fire. It may burn down eventually but if that gasoline can in the garage explodes it will happen much faster. So the slow burn down also more time for the firemen to do their thing. The question remains whether our economy "firemen" can put out the flames in time to prevent total destruction. Opinions vary.

An interesting series of radio broadcasts from Baltimore, moderated by Dan Rodricks. Many of the experts are familiar to TOD regulars


A lot on climate change today. I found this one especially intriguing:

Research Panel Says Climate Change Doubts Slow Urgent Action

Public misconceptions of climate change have thwarted urgently needed U.S. efforts to reduce emissions blamed for global warming, according to a report from the National Research Council of the National Academies.

Gosh, I wonder how much public funding went into achieving this breakthrough conclusion. At least, like the UN Panel above, these folks have jobs which allow them to spend and consume while revealing the obvious to the rest of us. The fine art of breaking the news gently?

Methinks Leanan has decided to introduce a "Friday Frustration Factor", so I'm off to get some free, barely-used gutters ;-)

It's double talk. The West exported its pollution problems (no expensive SO2 scrubbers needed in Chinese smokestacks) to the East and killed off its own manufacturing industry, although now the East is becoming quite wealthy because of it. The West also perhaps too successfully exported its vision of material wealth (the American lifestyle) to the East - now Chinese and Indians want to emulate the West. I've rubbed shoulders with rich young men in Canada - nobody cared about the environment, not really - they talked about cars, and video games, and hot babes and power, and lived for the moment. They did as they wanted - and why shouldn't they ?

re Plenty of Life in this oil age article....

Probably correct that there is that much oil. But much of it will be unobtainable. We've picked all the low hanging fruit. Eventually we will reach a point where it takes nearly the same amount of oil to extract what we can pull out of the ground. At which point the oil companies will declare that it is no longer profitable.

Trouble ensues when governments take the work of such "experts" and build a policy around it. Many still don't see the fact of peak oil in the way that they don't see the fact of global climate change. Despite overwhelming evidence to the contrary they dispute these facts and believe in something else and call it something like "Morning in America". Then get elected by similar believers and Detroit is then encouraged to build SUVs weighing 4 tons each!

Hopefully the Rapturous Beliefs of some of these people will be true and they'll all get Raptured a week from tomorrow - leaving what resources are left for the rest of us to fight over in the End Times. Don't bet the house on it though!

How do you know that it is probably correct that there is "this much oil"?

Anyway, even if peak oil was moved a few decades, failure to come to grips with this reality is just kicking the can down the road, just like we kicked the can down the road after President Carter. I still think that we should not encourage the production of a non renewable resource even if it were discovered that we had a lot more oil than we thought we had. The burning of fossil fuel is disrupting our climate system and making our planet, if not inhabitable, at least not comfortably so. Regardless of its abundance or lack thereof, we must continually seek ways to be less reliant on it.

Debating about the true peak oil date is debating the arrangement of the deck chairs on the titanic. Yes, maybe we can eek out a few more barrels of domestic oil to make us less dependent upon the middle east. But should we?

We need energy. Currently, we need oil, but that "need" is only roughly a hundred years old. I advocate going back to restricted consumption of oil, such as we had during World War II.

Coal is an abomination.

Nuclear is a Faustian bargain. But it is much less bad than coal and oil and natural gas as sources of energy.

Let us hope fusion (previous Drumbeat) pans out. Much stranger things have happened in regard to technological advances.

Let us hope fusion (previous Drumbeat) pans out. Much stranger things have happened in regard to technological advances.

I hope it fails. That may seem somewhat self defeating since the implications would negatively affect my life as well. If humankind gets knocked down several pegs that will be a good thing for other species and their ecosystems. If we get another tech advance in energy only a very small percentage of species will sustain the population increase. If we had fusion, a cheap unending energy supply, what would the population rise to? 20, 30, 100 billion?

If we had fusion and grew crops under controlled atmospherics in multi-story buildings, the population could make the 7 billion we now have seem like a small town.

A lot of people would say 100 billion is out of the question because of the need for fresh water. But with unlimited energy supplies, desalination is easy. The world economy rages into overdrive due to super cheap energy and the population follows. Maybe skyward in highrises, but it starts doubling again every so many years.

Maybe I meant "perhaps there is this much oil". I don't know and nobody knows. Even if there is, extracting all of it will be impossible and difficult and at a certain point the oil companies will give up, or start harvesting whales. Otherwise I agree with you on all points.

The danger is that these silver tongued people keep assuring us that we need not worry. So we don't. The Koch Brothers and Dick Cheney types tell us not to worry. Alternative energy programs get defunded. No progress is made. Meanwhile, we ponder the big issues such as if Ashton Kutcher will replace Charley Sheen on Two and Half Men and how they will make that work. Or what swimsuit Pippa got photographed in....

We were aware of this emergency back in the 70s at a time when we could have done something about it. The Reagan got elected with his "do not worry" political campaign and we stopped working on renewables. And taught the freedom fighters in Afghanistan how to fight wars. Now we are faced with resource depletion, Peak Everything, and those freedom fighters shooting at us. Yet some think they can get elected on a "Don't Worry! Be Happy" message and the more of these messages the more believable it becomes.

Do you think ANYBODY can be elected on a "Be concerned, be very concerned about Peak fossil fuels" platform?

Politicians say what they have to say to be elected. That is largely why they are elected. The Ronald Reagans will always and forever beat the Jimmy Carters.

'Twas ever thus.

That will work until the crisis is so obvious. But then it is too late.

Can you imagine someone like Sarah Palin in charge of this?

We are so F##ked!

Yes, I can imagine Palin as president. She may very well be our next president.

Sometimes, I have a hard time getting to sleep at night.

I don't think she will run. I don't she is interested in any real responsibility.
She is an opportunist whose goal is to make lots of money by charging high speaking fees and selling lots of copies of her book. In order to do that she has to stay in the spotlight by playing to the gallery. She will just something completely outrageous once in a while to stay in the limelight. It doesn't have to make any sense as long as it appeals to her fan base.

Running for president requires a lust for power so strong that you are willing to compromise on any values you might have had to get there. I don't think Sarah Palin has much in the line of values or lust for power. If she was anything like power crazy she wouldn't have given up the governorship.

Yep. She's after the quick buck.

I don't think Sarah Palin has much in the line of values or lust for power.

I agree. She acts out to make money. Nothing more. I don't even think she's passionate about the subject matter, she just uses it to peddle her name and that makes money.

Look how much money the Kardashians are making. Last year something like 60 million dollars! And for what? They got their faces on the TV and peddled it. No talent or anything, just a name that somehow stuck. Like Lady Gaga is raking it in. If you get the right name or create a niche like Sarah did a person can make tens of millions just sticking their face on the screen.

I am hardly a fan of Sarah Palin, mind you, but the latest Atlantic Monthly has a fascinating piece on her previous incarnation as Gov. of Alaska and her quite prescient and politically courageous role in standing up to big oil there. She turned on a dime when McCain picked her...hence the article's "tragedy of S P" title. Lesson: people are always less one-dimensional than we think.

Yes, I really want someone for president who quit her job as governor midway through her term because "it wasn't fun any more". SP is not a serious person. She is a media-created joke.

Note that the media also created Ronald Reagan. He was no joke.

Not a very funny joke.

Meanwhile, we ponder the big issues such as if Ashton Kutcher will replace Charley Sheen on Two and Half Men and how they will make that work. Or what swimsuit Pippa got photographed in....

You know, it's funny and fun to be totally out of it...nothing in the quote above has any meaning to me. We haven't gotten "TV" for years and years and we don't read tabloids or tabloid-like magazines. But, I can talk all day about apple varieties or the best dried bean varieties or the best way to deal with pests.

I'm spending my time today mowing the orchard.


We haven't gotten "TV" for years and years and we don't read tabloids or tabloid-like magazines.

Maybe not, but you still know:

Ashton Kutcher will replace Charley Sheen on Two and Half Men Or what swimsuit Pippa got photographed in...

So it still got into your psyche. Pretty effective media blitz I'd say.

No Earl,

The post could have been that Sally Doit wears her thong backwards and her stud boyfriend wears a gaff (that's sort of a male ballet dancers cod piece to make the leotards "look" better). I don't give a darn about these people, much-less "know" who they are.

The fact that this sort of thing was even mentioned simply makes me realize how absurd society is and that I'm glad I withdrew from it a long time ago. It epitomizes absurdity. This is why I responded as I did - that anyone would even know about or consider what useless people in the, supposed, "limelight" are doing of interest.

But, I did finish mowing the orchard and some other areas in the mean time.


Do consider watching old movies. I'm a big fan of Turner Classic movies and watch most of their three-and-one-half star and four-star features. Films made during the last twenty years are mostly dumber than spit. And no, it is not just my age that is showing; the critics also condemn the great majority of recent flicks.

There have been many great films made. Most of them were made 1930-1970. Film is a big part of my life, but today I have a hard time finding a movie in the theaters that is worth watching. (There are a few good ones, however.)

My impression is that most movies have always been awful. It only seems like old ones were better because there are so many old ones and a relatively few new ones each year. Percentage probably stays the same. Of course there are mini ups and downs. We seem to be in a down this season but I rarely see a good movie from the late forties or early 50s. I suspect that was the "blacklisting" period. Contradicting myself there was "The Day the Earth Stood Still" (1951).

No Todd, my point was the information saturated the populace, including those like yourself that think your not getting that information. Somehow you knew about Ashton Kutcher and the woman, and that just shows how infusive the media has become. Not even when someone tries to avoid the information can they successfully avoid the mainstream snipets.

This is why I now use Al Jazeera as my primary news source - genuine news without the cr*p.

Even the BBC is succumbing to celebrity gossip these days.

Casey Burns:
I echo your point but you don't really need to follow all the junk if you don't want to.

The media just puts out this stuff because it's their job and they're paid by big corporations and they've got nothing better to do (certainly not to accurately report on say, financial fraud or immigration or energy or any other important area).

So just tune the stuff out. If your family and friends mention trivialities, tell them bluntly you're not interested in such things. You will get accusations that you're "negative," but soldier on.

As oil prices drop, Fed should get credit, up top:

The Fed is a privately owned bank that creates money by means of debt and fractional reserve banking. This is the source of the national debt problem we have. It can be fixed by changing the money system to non debt based money according to "The Secret of Oz".


Karl Denninger is featured.

Denninger, the same guy who thinks Obama's long form birth certificate is a Photoshop job and that Obama should be impeached for it?

I have often wondered why anybody takes Denninger seriously. He must have something on the ball, but I have no clue as to what it is.

There are so many good sources of information: Why would anybody turn to Denninger? It is a puzzlement.

I was once a faithful follower of Denninger. Then I watched his rant on the birther issue. Now I don't ever bother anymore. I have removed his link from my bookmarks. Birthers are all nuts, or at least that's my opinion, and I don't bother reading blogs of nuts, I have more important things to read.

Ron P.

I was once a faithful follower of Denninger. Then I watched his rant on the birther issue.

Same thing happened to Mish when he strayed beyond his pay grade back in Nov 2009 and started ranting that global warming is a hoax. Interestingly, Mish frequently quotes Denninger...

Quoting from Mish's post Beware The Ice Age Cometh: Hackers Prove Global Warming Is A Scam

Now let's kill it permanently. Global warming is a hoax. At least the data presented is a hoax. If there is a problem then the free market will find a solution. The idea that a bunch of politicians with an agenda can do anything about it is ludicrous.

The earth has gone through cooling and warming cycles for millions of years. Attempting to measure one small period and then thinking one can find the true cause of that change (assuming it even exists), goes beyond hubris.

The problem with Mish, Denninger and their ilk is that their ideological blinders won't let them see that the free market IS THE PROBLEM in many instances. Such as the fact that a free and unregulated market will fail to account for the cost of negative externalities in, for instance, the free market price for energy and natural resources.

While there are problems with the fiat money system we have now, the gold bugs forget that there were problems with the gold standard also (which is how we ended up with the fiat money system in the first place).

The main issue is any monetary system needs corrective action against it's failings every few decades, and that corrective action is almost always going to be painful.

I'm somebody who is personally investing in physical gold and silver because I believe they are in a major bull market. I also hang on to cash. You can call this greed if you like, but I'm hardly a "gold bug" hoarding supplies and guns in the mountains of Idaho.

In addition, I'm in fact against a pure gold standard. Rather, I think the best possible system is one in which every nation on the globe agrees to a precious metal reserve currency, and national currency exchange rates can fluctuate based upon economic conditions. Such a system might prevent political and financial dislocations based upon the balance achieved. If a nation tries to devalue its currency, sure it gains an export or job advantage, but then it could acquire less and less of the reserve currency, risking ruinous inflation. And if the world stops producing more gold and silver, economic activity can still occur based upon progressive devaluation of currency. And if devaluation proceeds at too high a pace, we can always search for other metals to add to the basket that constitutes the reserve.

It's crude to be sure, but really the failure of humans is not gold vs. fiat, the failure of humans is psychological/political, it's inborn. We are simply incapable of a peaceful global system. We are tribal apes who jump at any excuse to massacre each other. I feel very very strongly about this, and this is the core that animates my pessimism.

And yet for every evil there is a corresponding good.

We are in many ways the ultimate transitional species, always becoming something else.

Also, you're right, you aren't a gold bug. It takes more than even a serious investment in gold to qualify there.

Interesting article on the concept of "eating locally" in Colorado. Given the climate and water supply, I doubt Colorado could support even 10% of its current population on local food alone. When the territory was first settled, the population was limited to trappers, farmers and miners. Only after the railroads came did the population expand beyond that, because with the railroads came relatively cheap food imported from the east. Even with the limited population up to that point, virtually all of the wild game had been wiped out supporting just a few tens of thousands of people.

Without inexpensive long distance transport, places like Colorado, Wyoming and Utah could not support even a fraction of their current populations. The Mormons struggled to support less than 100,000 people in Deseret before the railroad arrived.

The really scary thing is that there is nowhere near the rail capacity any more in Colorado or the rest of the intermountain west to support the current population of about 10 million in CO, NM, WY, UT and MT. There are no large navigable waterways for transport. This area literally lives or dies on the availability of not only cheap transport, but cheap overland transport in the form of trucks. Before the railroad, teamsters made a killing hauling supplies from Kansas City and Omaha to Denver. Of course, that model is not sustainable when you must support the 5 Million people currently in Colorado. There are essentially two Interstate highways and one rail line bringing supplies from the east, one rail line and one highway from the north, one highway and one rail line from the south and one highway and one rail line bringing supplies from the west. That is it for the entire state. There have been a few instances over the last decade of I-70 through the mountains closing for several days, and within three days Grand Junction is facing shortages of everything from gasoline to bananas.

If you bring up this situation, people at all levels look at you like you are from Mars. Food comes from the grocery store, and how it gets there is magic not to be worried about. I hesitate to mention this, but I will because it is not rocket science. It would only take fifteen terrorists to bring the state of Colorado to its knees and invoke a huge humanitarian crisis here. I leave it to the reader to figure out how.

Big Oil hearings great political theatre:


The counter from the executives was predictable: higher taxes would put them at a disadvantage against their international competitors, many of which are government owned, and their hiring in the U.S. would suffer as a result. There even were veiled threats that gasoline prices would increase should their tax bill rise.

So we must socialize oil companies with subsidies because the competition is socialized. Very interesting. Perhaps we should subsidize American companies competing with Chinese products since many Chinese companies are state owned or are obliquely subsidized.

I have to admire the justifications they come up with. They are very creative. The idea that cutting subsidies is a tax increase is very inventive. So when ethanol subsidies are cut, taxes are increased on ethanol.

As an ethanol subsidy defender (at least as long as oil is subsidized), it is fun to watch these guys squirm. They are to same hypocrites who fund attacks on ethanol subsidies and bad mouth ethanol all the while pocketing the blender's credit.

Since most politicians receive oil money, I have little hope the oil subsidies will be removed. Mostly they will stay in place as will wars for oil security, the biggest oil subsidy of all.

It does appear that ethanol subsidies will end or be phased out though, since most ethanol congressmen are on board. Then we will be left with subsidies for non renewable oil 60% of which is imported while taxes increase on ethanol as it eventually goes unsubsidized albeit mandated. Oil is mandated by the vehicular infrastructure and liquid fuel distribution system.

According to Pickens companies importing oil are funding terrorism:


So now we have a picture of tax money going to oil subsidies which then goes to terrorists according to Pickens.

At least it won't be going to corn farmers and ethanol producers!

What a country! What a system!

Nicknamed the Prius of the seas, the USS Makin Island is a hybrid diesel-electric ship that relies on electric motors for power at low speeds


So the US Navy is increasing its interest in non-FF propulsion (so they can be more "green" while delivering freedom and liberating oil?)


As far as I can see the Makin Island hasn't the slightest resemblance to a Prius or any other hybrid. It does appear to have a reasonably efficient main propulsion system including gas turbine main engines and variable pitch propellors. The ship uses electric motors driven by diesel generators as a more efficient propulsion mode using two 5MW electric motors. This mode allows the ship to travel at speeds up to 12 knots. The 52MW main engines allow speeds up to 25 knots.

A 52% reduction in speed gives a reduction in power requirement of greater than 80%. Slowing a ship saves a lot of fuel. Especially when it's diesel power (up to 54% thermal efficiency) instead of gas turbine (less than 40%).

Also, the diesels have much better part load efficiency than the gas turbines. Turbines are great for planes where the turbines are at full power for takeoff and then 60-70% for cruise. But navy ships cruise around on less than 20% power. if you are running one of the two diesels at 33% load (16% of full system load), it will still be at good efficiency, but the gas turbine would be probably 10-15% efficient. This would make a big difference to the operating time/range of the ship. And since, in the absence of action, they spend most of their time at low speeds, this make big difference.

The other difference compared to a hybrid is their would be no energy recovery for the ship - you just don;t stop that often, and it harder to recover energy from the water than a road. For the Prius this is where a large part of its city fuel savings come from.

The Navy has run diesel electrics for decades. Standard design for pre-nuclear submarines.

History repeats;

"At full load, Saratoga eventually displaced some 41,000 tons. The carriers had turboelectric propulsion designed to produce 180,000 horsepower, or six times that of a contemporary battleship. This type of propulsion was larger, heavier, and more expensive than an equivalent steam turbine plant. Still, turboelectric drive permitted more compartmentalization for damage control and was, in theory, more resistant to damage."


This was CV-3, built in the 1920's.

Some battleships were built turboelectric too. They had an advantage where they could switch the motors to have double the poles, then run them from half the generators, so they could shut down half the boilers. This gave them an extended cruising range at still reasonable speeds.

The Navy was playing with super-conducting motors while I was in. I wonder if it payed off. The weight of the motor, (which ends up being way aft, where you would rather not have a huge amount of weight) was really the main problem with idea.

BBC has the following:


The authors call for resource consumption to be "decoupled" from economic growth, and producers to do "more with less".


"Prices for resources between 1900 and 2000 fell in real terms," he explained.

"From 2000, resource prices have started going up and there is a consensus among economists that this is not a blip but probably the beginning of a long-term trend.

Acceptance of resource limitations...

Future Babble

... psychologist Philip Tetlock, who examined thousands of predictions from hundreds of experts (political scientists, economists, journalists) in order to determine their accuracy. Through his study, Gardner tells us, Tetlock discovered “the simple and disturbing truth is that the experts’ predictions were no more accurate than random guesses.”

Hang on, he studied the predictions of experts such as 'political scientists', 'economists' and 'journalists'? Since when has any one of those been considered worthwhile to listen to in the field of prediction? Snake oil salesmen is being kind.

Where is the reference to people like scientists, engineers, and most of all systems people? Sounds like he went in with a preconception of what he wanted to find, and adjusted his parameters to make sure he found it.

OK. You're so smart. Show me some evidence that engineers can predict the future better then economists.

There was once this guy, a geologist, who came up with a prediction of US oil production - you might have heard of him?

That was going on for 20 years out.

In contrast, economists were still saying the market was 'fundamentally sound', whilst financial firms were collapsing around their ears.

That is not really what the book was talking about. Sure, some experts are right some of the time. What the book argues is that experts are not better than random chance. Which means some of them are right, some of the time.

I didn't think you would be able to come up with any evidence to support your popular little myth, but I did expect that after your arrogant comments about systems people you would have done better than something that is halfway between an anecdote and a rant.

A lot of the book is based on the work of Philip E. Tetlock, known for his book, Expert Political Judgment: How Good Is It? How Can We Know? As you might guess from the title, it was specifically political predictions Tetlock studied - hence the type of "experts" he studied.

Does it apply beyond that field? He argues that it does. What Tetlock found was that people who make the best predictions are the ones who doubt themselves the most and see the world as inherently complex and difficult to model or predict. People who make the worst predictions are the ones who see the world in terms of one big idea, and have a sort of Occam's Razor view of the world - they like to simplify things, and see the world as more clockwork than chaos.

And definitely relevant is the way we tend to still turn to experts, even if they've been proven wrong again and again. (See Yergin, Daniel.) Humans tend to defer to people who are confident. It's actually the people who are not confident in their own conclusions who make the best predictions, but we tend to believe those who are most confident, not least.

Tetlock found that computerized statistical analysis is more accurate than any human, so it's not that he's anti-science or anything. Basically, his argument is that how you think is more important than what you know when it comes to making predictions.

If you believe what Telock says, this kind of proves that you really don't have to know that much about any topic to do predictions. You simply have to have some knowledge of probability and statistics and have a basic model of the underlying behavior. The problem might be complicated but there are usually one or sometimes a few first-order effects that rise to the surface. The fact that Tetlock can generalize his own model to essentially predict how effective everyone else's prediction is based on a simple model (big idea vs disorder/complexity) proves his own point in a recursive fashion. You see, he can't have any way of knowing all the other prediction problems in the world, yet he makes his own prediction on their effectiveness! And he thinks it is reasonably correct. How do we know that Tetlock is only formulating his own "one big idea" and basing his prediction on that? He would then have to admit that his own idea is not so good.

This is a deep almost circular observation that you really have to mull over.

If Tetlock has a "big idea," it's that people are really bad at predicting the future. Some are worse than others, but we're all really bad at it.

I know that is his big idea -- so why doesn't he consider that his own approach is bad at predictions?
After all he classifies himself as a one big idea guy.

He's talking specifically about making predictions about the future. It doesn't apply to all types of research. It may well be that "hedgehogs" are better than foxes at some things. In fact, it's likely, or they wouldn't exist.

Yet, a model of what happens at the present time is implicitly a model of the future given that behaviors don't change. So his model is that certain people will incorrectly predict the future for years to come.
That is at the root of any model used in engineering and science.

I don't think he really has a model, nor that he went in with any preconceived notions. It's an empirical thing. He spent 20 years on it. He asked a variety of experts to make specific, numerical predictions, and checked them for accuracy later. He was curious about what makes for accurate predictions, and the fox vs. hedgehog thing was only one of many factors taken into consideration.

And he's not anti-expert, by any means. In fact, he tested that, too, pitting students given the bare outlines of a situation against experts, both foxes and hedgehogs. The students were worse than the experts, by far.

Web - Mull...mull? I don't need to mull nuthin over. I'm a petroleum geologist...I know the answer I need to sell my drilling idea. All I need do is make the appropriate assumptions in my model.

Geeeesh man...I though you knew somethin about developing models to support an "expert" prediction.

Pro budget cut demonstrations in London: http://www.bbc.co.uk/news/uk-13398966

A rally is taking place in central London in favour of government cuts, arguing that the country's debt has to be reduced.