“A third of humanity doesn't want to ride bikes anymore; that has profound geopolitical implications.”
—Anne Korin, the co-director of the Institute for the Analysis of Global Security (May 1, 2005)
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Driving home from the grocery store tonight, I passed a house on a hill that was decked out in holiday splendor. Trees and shrubs were covered with colored lights in all sorts of 'festive' shapes and Christmas themes. It reminded me of when I was young my parents would drive us around town to look at who had the best 'christmas lights' in town. It was actually usually the local fire station.
Alas. 18 months after learning about Peak Oil and continually exploring it since, my immediate thoughts on viewing this brightly bulbed house were along the lines of: non-sustainability, kilo-watts, what kind of fossil fuels were being used to generate the electricity, how much energy went into creation of the wires, etc.
For me, as hopeful as I am for the 'silver BBs' that we will collectively find to ward off societal twilight in the next generation, I feel my childhood ended last year (I am 39) when I started reading dieoff.org and other Peak Oil sites. I still very much enjoy life and all pursuits human, but I now view things that normal people take for granted, in a much broader, more critical light. I cant help but think in terms of sustainability and energy now when I look at everday things.
Yes, sometimes ignorance can be strength. Happy Holidays everyone.
Well put.
Once you become PO-aware, nothing is the same any more.
You have spotted your first "bug" in the system.
BTW, if you have not seen "The Island", it's out on video. Not an Oscar winner, but very interesting from a PO-aware point of view. It shows how a small piece of information can change your entire view of the world.
Holding your sweet child's hand and telling him it will be ok, while the smiling nurse injects them with a huge dose of mercury and a multiple vaccination that will cause years of misery.
Realizing that most doctors are just the distribution arm of large pharmaceuticals.
Finding out that your government does not work anything like what you were taught, and seeing an election stolen, your government hijacked, and the nation torn apart.
Finding out your news media has become Pravda, only it's worse because so many people don't know it.
Learning that so many of the myths we learned about our history are utter crap, lacking even a shred of truth.
Understanding the damage being done to the environment, and feeling powerless to do anything.
Yes, it's made me a cynical bastard, but there is good too. While it is sad that we cannot just believe what we are told, I have accepted that I must do my own analysis, and make my own decisions - it's a different way of thinking, but rewarding in it's own right. There is satisfaction in gathering knowledge and making good decisions. The concerns over what the future will bring weigh heavily on my wife and I, but there is still the love of our children, and the knowledge that I have a very capable partner and we'll deal with whatever comes together - it will not be the first challenge we've faced.
So enjoy the holidays, try to focus on the simpler pleasures, and don't mourn the passing of traditions that don't matter anymore. And if it makes you feel any better, those Christmas lights don't really use that much power!
Back in August I penned this for a young american friend of mine, thought it might be enjoyed by some here.
<BOLD>Who killed the 'American Dream'?</BOLD>
Back when there were about half as many humans, before Intel made the first integrated chip (1974), when mainframe computers about as powerful as modern wristwatches were just becoming available costing $ millions and were the size of rooms, I read a book. "Limits to Growth" was written by a handful of academics who wanted to try out these new computers for modelling and forecasting something. Nowadays they'd probably try it on stocks and shares, then they modelled the future of the human race and its interaction with this planet. Some people walked around with their eyes open in those days and were brave enough to look at meaningful things.
The computers were slow, the models simple, the results probably mostly inaccurate, but it was the first time people had systematically considered human and economic growth and when it would run into the natural limits of this planet to support them. There was no simple answer but the one I remembered was: things start to run out around 2016 give or take a few years. More than 40 years away, plenty of time for us smart humans to fix things. Ah, the optimism of youth.
About four years ago I was seeing mention of 'peak oil' and began looking into it. Realistic estimates (from ASPO) then were that it would happen about 2012, still over 10 years away but starting to get close - time for me to begin thinking of what I should be doing, and where, when peak oil hit. Well, in these last 4 years I've watched with growing concern as that estimate has moved to 2010, 2008, 2007 - the estimated date for peak oil and the present date have been rushing together at similar speed. Like two galaxies colliding the first impacts have already happened and their ripples have begun to distort and rip our reality, though few have noticed yet.
Peak oil brings the end of the 'American Dream', the US economic and financial systems have minimal chance of surviving it, the next 10 years will bring at best the halving of wealth of the american people, or halving US population, or maybe both, or maybe worse.
In the latter half of the 1970s the american people elected a truly honest president, it coincided with the last energy crisis. He set out what the USA must do to become virtually independent of foreign energy supplies. It never happened, he wasn't re-elected.
Had the american people, congress and senate supported Carter and implemented the energy policy that he spelled out very clearly the world would be very different today and peak oil would be at least a decade farther away. We would have time to change further and the US would already be at least half way on that positive road. But, as Carter said "There is no way to avoid sacrifice...". That didn't sound nice so the american people turned their back on truth, embraced illusion, and postponed the (then small) sacrifice. Thus was humanity and this planet betrayed.
There are a number of answers to my question but I am thinking of two specific ones: an individual, and a group of people. No conspiracy, both obvious and inter-related.
Is there any possible way that supply can meet demand in North America ever again?
I have had feeling about this ever sense I started investigating LNG. Now after reading this weeks Wall Street article, my outlook even looks more grim. LNG now costs $2-3 above the Henry Hub....and the USA can't get enough to make a dent! How high must it get before we can import enough to even make it worthwhile? How much natural gas will be used to extract the harder to reach oil? Will exporting countries keep their LNG for future use? Is increasing LNG supplies a myth?
It appears to me peak oil will be a vicious downward spiral. The market will save us! Well the market has never had to deal with this. The market has never dealt with population decline and has always had another energy source to take advantage of. Capitalism is nothing but a pyramid scheme that only works when unlimited supply is available and more people are added to the bottom year after year. Both pillars of the capitalist model will start disappearing in a matter of years, whether this year(Japan? Europe?) or in 25 years, the pyramid will collapse before we even know what happened.
The market says LNG will "carry us to another source" "bridge the gap". What if LNG is a boondoggle that never pans out?
I think this the biggest question mark in our energy situation over the next 5 years.
I've described some Japanese techniques for conserving natural gas here.
It's really not a big deal. I know Americans who have reduced their NG consumption to 15% of what it once was with negligible effects on their lifestyle.
Seriously though, there are some very simple principles that govern heat conservation:
1. It's cheaper to heat a smaller volume than a larger volume. So just heat one room, or better still, part of one with dividers. Better still, wear warm clothing in the house. And of course thick blankets or even an electric blanket is good if you're old and don't generate as much heat as before. Central heating is terrible when avoidable. So is central air, but it's winter---off topic.
2. Heat used equals temperature times time. It's cheaper to heat just when needed. Turn heat down or off when not needed. Hot water should be heated on demand.
3. Heat rises. A ceiling fan can mix it up and bring some of it back down.
4. Heat convects, i.e. leaks where air leaks. Plug where it leaks. Use incense smoke to detect air currents. Don't overdo plugging in a really small space, however, until you overcome your oxygen addiction.
5. Heat is at the end of the energy chain, i.e. most other forms of energy degrade to heat. So: almost all of the energy from an electric heater turns into heat---there's no efficiency issue. So: incandescent bulbs are ok in a room you want to warm up---but otherwise they are a big waste.
6. Heat radiates. I'm not sure how much goes out the window. Properly colored drapes and that kind of thing might be important. Help.
I live in a condo with 69 units. We are just beginning the struggle around all these issues! This is the winter everyone will realize there is a BIG issue---when we get the bills.
In the long term, you are probably going to want to get really serious with insulation everywhere.
It sounds exactly what I have been looking for?
Rick
He also mentioned the falling resources in Indonesia.
Not pointed specifically at Indonesia but I wonder what the typical despot will choose, Big $$ from OECD in his pocket or food for his slaves/people?
In the larger picture I think there's still lots of gas out there but in the short run, Limited processing, Very limited Cargo Capacity and limited port locations (aka nimby). The few shipyards that build LNG shipping are booked up with orders for dedicated route ships.
Question I have is, with 100% gulf production recovery will we have enough gas next winter? In a more worse case what if we have another damaging hurricane?
If you add up all the countries that are planning on using LNG in the next few years, you wonder where the supply and/or investments-pipelines-ships-terminals will come from.
USA
Canada (for tar sands...yuk)
Mexico
Chile
Indonesia
China
New Zealand
Spain
Italy
England
Japan? (Not sure if they need more or not)
That is at least 10 countries that are building new terminals and/or expect an increase in gas to their country over the next few years.
And if any of this gas is used for electricity production, you can expect only a 30% Energy Return.
Just doesn't make sense to me. Somebody is going to get screwed in this whole deal. And most likely rate-payers.
Flavius Aetius
(to other posts)
2 There will not be a US ng shortage for several years. The hidden hand is already booting the chemical industry, or that bit that makes feedstocks from ng, overseas to where ng is cheaper, taking jobs and tax base with them. High prices are also persuading most, certainly including the poor but also much of the middle class, to reduce consumption. Current stocks in storage do not justify today's high prices, and traders doing the math are accordingly taking prices down. However, in 2015, when US ng production may fall off a cliff, we will hopefully have elbowed our way to the front for ng imports (we expect and deserve the lion's share), or have built sufficient coal (ugh) or nuke power plants such that electrons will continue to obey our commands. The difference between Britain and the US is that Britain is facing this question in 2005, with zero lead time. We have a great seat to watch what will be our own preview if we squander tne next decade as we have the past three.
3 Carter was prescient on energy, which he saw as his great test - most presidents have a couple. BUt, he failed to seize the nettle and cut off Iran's oil exports in response to the hostage crisis, which would have caused a brief spike in oil but would have quickly brought the hostages home. Judged a failure in what the US public thought the greater crisis, he was cast aside. The Iranian nettle is back - we will soon see if Sharon repeats Israel's past efforts at vetoing nuclear weapons from competitors.
4 Are people aware that, early in Clinton's administration, when Democrats had a majority in at least one house, a carbon tax was proposed, but that environmentalists did not support it because it seemed to favor nukes? Naturally, with no major group behind it, the CO2 supporters had easy work. It has always been true that people are either pro-coal/anti-nuke or anti-coal/pro-nuke. This will become more apparent as we go forward (or backward) into the future.
5 McMansions are mostly new, and many are extremely well insulated, using the latest materials and techniques. They might not use much more than that consumed by smaller, older homes. The main thing is that the poor and middle class luckily far outnumber the rich, so as a proportion of gdp the latter don't matter much.
Happy holidays.
Someone told me Economides predicted $20 by X-mas. We can put that in the wrong column, Agric. But I didn't here him say it, maybe someone can verify.
Put me down for $20 by next Christmas, though. And It would be interesting to see how many people, at least on The Oil Drum, would bet against that outcome.
Oh, wait...
In my understanding, in market based pricing, a falling supply will cause prices to rise. The rising prices will either cause suppliers to come up with any additional supply they can find, or more likely will cause consumers to cut back. Consumers are already cutting back. Industrial consumers are shutting down and leaving for places with cheaper supplies. Consumers can cut back a lot more than people think, though again, they will probably start screaming about the pain. At what point does the public pain cause the politicians to switch to rationing? Or, from the other side, at what point do so many producers nationalize production that the only way to get supplies to market is to go to war for them?
I think inflation, dollar devaluation, and recession are more likely responses than capitalism failing. Market pricing is much older than the oil age. Of course, if there's enough inflation and recession, we'll start reconsidering capitalism again, as we did in the depression. People are even less willing to accept severe changes in the labor market than they are in the energy market. As many have pointed out, large changes in the energy market will most likely result in large changes in the labor market at some point.
Why is the US being outbid.....
From the Wall Street Journal article
So yes the long term prices are not that bad, but any increase supply is well above the spot prices. And the only way to bring down prices is to......increase supply!. So either way we will pay high prices.
But there is no guarantee that supply and demand meets at a price where people are comfortable or even surviving.
Please do not mix theories about how markets work with naive almost religious ideas about markets allways providing comfortable lives for almost everybody.
A technically well functioning market is most of the time the most efficient way known to get limited resources to where they are most usefull and thus to get resources invested where they can grow.
This is most often very good in both good and bad times. I think abandoning market principles and laws supporting working markets, especially physical markets would be a terrible mistake during times when companies need to go bankrupt fast to free resources and other companies and other infrastructure need too be built fast.
The larger percentage of people that can be fed and find a future however poor in a working market economy the easier it probably is for the state to keep the rest alive in hope of them finding a future.
It is my hope that any economic repercussions from the future energy situation will not happen too soon so that those of us that are making efforts to prepare have time.
Until I see any major heads of state address the issue point blank, I have little hope that the developed countries economic stability can be guarantee when the squeeze comes.
Re peak oil, just learned in May, hoping no crash soon, to much to do. Thanks for this site, It is helping as many don't want to discuss this or fell the need to.
It would seem to be a mix of probability and economics.
Understandably, bigger fields are easier to find. If you cant find em you cant produce em (see north sea for example)
However, much more important is that bigger fields generally provide much bigger returns. All other things being equal, a hole in the ground is a hole in the ground, and will cost a certain investment in order to dig it. A larger field will pay a return on that investment for a longer time period. Also, larger fields can bear a greater number of wells (for the same fixed infrastructure investment), and therefore a greater return on investment can be earned faster.
Lastly, the main infrastructure that makes a certain field viable may only be worth implementing in the context of the larger field. To clarify, a small field in the middle of nowhere may not be worth drilling, because the costs required to get that oil to market would be too great. However, if a big field shows up next door, that may justify building a set of infrastructure to move that oil (pipelines, roads, etc.). Now that the nearby infrastructure is in place, it may be worth drilling the small non-viable field mentioned earlier.
The solution to our energy problem is not to take someone else's oil.
We're all in the same boat, so instead of trying to beggar each other, let's start bailing and repair the boat. There is no other choice!
God help us all!
For a little example, during the holidays I have had to move my office out into the shop to make way for all the relatives, and being lazy, I simply put on more clothes rather than starting the stove. Behold! I am very comfy sitting here in my layers of fuzzy clothes in a cool shop! 10C is no problem.
And of course the Inuit would laugh at me. Or my Scots cousins, who never got around to central heat in the first place.
And I have finally convinced my family that $ gifts are not to be given, except from us old geezers to young folks in some sort of actual need. That made us all a lot happier and richer to boot.
And what could be more wasteful than the private car as the ONLY way to get around! People like me shouldn"t even be allowed to drive, much less, have no choice.
Add your own favorite example of waste here.
My best idea for energy saving was at work. I went and took out half the overhead lights in the room I work. My boss objected at first, but forgot about it, so the energy saving continues.
One day you will wake up with your sweater and ride your bike to your office and it will seem kind of like a typical day to you, because your neural grooves will have become conditioned to those` behaviors -but all around there will be other people in sweaters on bikes that will not be pleased...Keep it up - we have genetic algorithms that work on 'relative' vs 'absolute'. I expect some % of the PO community has gravitated here just for that. But someday theyll be right.
I've just realised something about my pseudo-religion: I can be sure my god exists, being cosmotheist, heheh.
You probably could not implement good enough pollution controls to make this feasible, even if you could separate all the PVC to keep from generating dioxins.
Thermal depolymerization can convert plastics back to hydrocarbons. This is probably the best option.
Hello oh.
Being a fool myself, I expect 2006 prices to be in the $60/bbl to $80/bbl level and stay there all next year. But alarmist predictions in the shorter term do us no good and only promote complacency.
Who knows. All I know is he is going to look real silly if he's wrong.
Turning the bet on its head: the majority of humans will look damned stupid when the bet is won. On second thoughts, strike that 'will' and the qualifying when clause.
But we need someone credible to shock people or at least initiate the first shock in the treatment.
Right or wrong, Simmons is one of my heroes. Hes a straight shooter, articulate, non-wacko, can think in big picture, and has 5 daughters. (Matt, if youre reading, Im still single...;)
Consider the demand side of things. At the APSO conference in Denver, one of the speakers (Henry Groppe?) said that their research suggested that the price elasticity of oil in the neighborhood of $60/bbl was roughly that a $1/bbl change in price resulted in about a 100K bbl/day change in demand. Various sources suggest that world-wide demand, ignoring the price issue, would "like to" increase by about 2% per year or about 1.7M bbl/day. Assume that production stays flat, so actual demand must be constrained to no increase, and you would expect to see prices increase by $17/bbl, putting things up in the mid-70s.
Barring the unexpected developments — a recession that decreases demand, a large increase or decrease in production — prices in the $60-$80/bbl range seems to be a quite conservative estimate. The futures market seems to be betting on the bottom end of that range; presumably they believe that production will increase to meet the increase in demand, but no further.
1. The real impacts of constraints have not hit yet.
US refining capacity utilization reached 95.6% in 1997 but was only 92.6% in 2003 and 92.8% in 2004. US capacity utilization as of November 16, 2005 was 84% (although we exceeded 95% in July). Most countries (China the main exception) have more spare capacity. There is a global boom in refinery development and more than a million barrels per day of new capacity coming on line in the next five years.
http://www.eia.doe.gov/cabs/Usa/Oil.html
http://www.eia.doe.gov/emeu/aer/pdf/pages/sec5_21.pdf
2. The immediate impact of refinery constraints on oil prices is to increase the value of light sweet crudes and decrease the value of heavy, sour crudes. While the spread has been growing in recent years, even the price of the lowest quality crudes has been increasing. If refining capacity utilization hit 100% globally, the impact would be to raise the price of light crude to a very high level. This is because light sweet crudes produce a higher volume of valuable products in a given refining configuration that heavy sour crudes.
The other side of the equation is oil in storage. This value has climbed, both because futures have been higher, so it pays to buy and store, and because the refineries world wide have been unable to process the crude. A large refinery is starting back up as we speak, but seems unlikely to be able to process all the crude arriving in US ports, and if so stocks will continue to rise.
All of this does not mean I think oil stocks are a bad investment. OPEC will defend $50+, if necessary, and the small E&P's that I invest in are very profitable at this price and above. However, I doubt oil will rise above $60 unless some major event happens. In my previous post I outlined one that I think is at least 50%, and if it comes will be soon, 1Q06.
A year from now, oil could be $30 or it could be $90. You would be a fool if your investment porfolio didn't give serious weight to $100 plus oil next year.
And here comes the bonus. In all likely-hood(Note to self:Is that a word?) - the same companies and entities that would do well if the price of oil goes up, would, in fact, have benefited in the process of the price of oil going down. You can't lose in this sector.
The best gain you can assign the overall market in 2005 will end up being about 5%, kinda lame, flat, and barely beating inflation. Yet if you had put your money on simply run-of-the-mill energy related stocks for the year or even just the last six months - you would have made, at a minimum, between 30 and 60% on your investment. That is crazy money in this environment. Energy stocks are the new dot-coms. That trend will continue for at least the next 12 months. But be careful.
Oil is close to a cusp, I think. It has increased in price by over 30% in each of the last 3 years. That has spurred just about all possible rapidly available production to come onstream. Some biggish new projects are due to come online in 2006 so there is a possibility that there will be a slight oversupply in the near term. The two critical factors are: will decline rates in the current major fields in production (FIP) be higher than current fairly optimistic predictions; will there be a significant reduction in demand (currently expected to be 1.9% increased demand) due to a global slowdown? A few months back I coined "Agric's law of oil price" which is: the average price of oil in a calendar year will be within 5% of the maximum price for the previous calendar year (Nymex light sweet, next month quote). This has been true the last 3 years, I expect it will continue to be so until prices go haywire. That gives an average price in 2006 of $70.
I expect the oil price to creep up to $70 by mid march. Thereafter I predict a spike to about $95 in response to some external event, it could happen by mid April. Will $100 oil happen in 2006? Maybe not based on current supply and demand but there is a significant probability that geopolitical or supply disruption events do cause a $100+ spike. I do not expect the oil price to drop to $40, even $50 is unlikely since a key support level at $56 has held well in recent months.
BTW, I believe that when he does make such a statement, he tends to be pretty accurate. When he was talking (correctly) about US natural gas peaking in 2001, CERA, EIA and nearly everyone else thought he was out to lunch. They had to eat their words. When he said he thought the North Sea was peaking in late 1990s, he was also considered foolish. As noted before, the IEA didn't recognize the North Sea peak years after it had happened. I think when Simmons makes a solid prediction it's probably better money than anyone else out there.
You made a $5,000 bet with conservative New York Times columnist John Tierney that per-barrel oil prices will be at $200 in 2010. How did you arrive at this number?
Well, first of all, the $5,000 bet was essentially an effort to be provocative and wake people up to how cheap oil still is. I started a year ago saying that we need to prepare ourselves for triple-digit oil prices -- and I don't mean $100 per barrel, I mean high triple digits. Will it be by 2010? We don't have any idea. It could be by the winter of 2006
Oil price will ultimately be set by demand and supply. Current oil prices are ridiculously cheap. People find that hard to believe, particularly now, but consider this: $65 a barrel translates to 10 cents a cup. Ten times cheaper than bottled water. People who think that this is a really high price need to have their heads screwed back on.
You have an enormous amount, professionally, riding on the prediction that peak oil is nigh.
I'm basically betting my entire career.
Furthermore, tying the price of a cup of oil to a cup of water is a silly comparison. We can always use tapwater for 1/10 of a cent a gallon if push comes to shove.
I fear Simmons' skepticism and rationality has been swallowed up by his big idea and that's a bad thing.
http://www.newyorker.com/critics/books/articles/051205crbo_books1
This is a review of a book which described years of research asking experts in a variety of fields to predict trends, whether things would stay the same, increase or decrease. Not only were the experts wrong, we would have done better with chimpanzees throwing darts at a chart to get our predictions. One reason for the bad record is that "interesting" predictions like the ones we are discussing here get more attention than boring ones like Dave's more or less business-as-usual scenario:
The bottom line is that Simmons is in fact "a little out to entertain", to get attention that can improve his consulting business and sell his book. Few will remember his failed prediction but he got lots of press from it. Same with his year 2010 bet.
However, his possible price in this timeframe is not going to happen and was unlikely in any case--but his statements only give ammunition to the people who think we're some kind of weird "end of the world" doomsday cult anyway. OK? This is my concern.
The number one thing he and all of us should remember re:PR issues is that no matter how clearly you qualify the number, if you provide a number that's what people will remember as being your prediction of what will happen.
Today's price isn't a fair reflection of the current global supply/demand situation. It's too low, it's being temporally subsidised by drawing down on reserves. Soon this drawdown will stop - prices will rise to where they should be. If any attempt is made to replace the last few months drawdown then price will rise even more on top of where it should be.
http://tonto.eia.doe.gov/dnav/pet/hist/wttstus1w.htm
http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html
The SPR drawdown of around 15mb is miniscule, and can be easily repaid next spring.
Some say that we are running out of NG while others claim that we're not.
Who's right?
In some stores they say shoppers are buying "like there is no tomorrow".
Is that true?
Is Dec. 2005 our last Christmas?
Will there be happy times again at end of 2006?
Or will XMAS 2006 be remembered as DTSHTF (Day The Stuff Hit The Fan)?
from Karavans
What are the alternatives to Capitalism?
Go back to Feudalism?
Try Communism again?
Roman War Empire?
Something new?
Once this new depression is really into full swing other implentations will manifest simply out of community need. If people are smart about it and work together we'll make it the last depression ever and abandon central bank debt backed interest bearing fiat currencies altogether. They're the biggest part of the problem IMHO.
A "scared" cow is a dangerous animal.
(Someone asked an audience to raise hands if they used Viagra. No one raised their hands. The speaker said "Can't get their arms up either!")
(Sorry.)
Alternatives to Capitalism -- Capitalism as our Sacred Cow...
Jared Diamond's COLLAPSE certainly comes to mind here. Populations that cannot adjust because they cling to their old cultural fundamentals.
But that begs the question again rather than answering it.
Communism has been a failure pretty much everywhere in the world it was tried (even Red China is switching to capitalist model).
Capitalism is a runaway greed machine that consumes fossil fuels at an ever increasing pace and warms the globe. We know it can't go on much longer like this.
So what is the new paradigm that might work?
We'll see a lot of entrepreneurial creativity when it becomes clear that the nature of the game has changed with energy. Even with a prolonged macroeconomic contraction, some industries/places will grow, and that is where the capital will flow.
The GOP has the fantasy that tax cuts for the rich create jobs even though the evidence completely contradicts that. Future prosperity can only come from a mixture of social and public works programs and wisely regulated private enterprise. A major portion of surviving and even prospering from peak oil needs to be an Energy Production Board similar to the War Production Board of WWII. The technologies exist to convert to a non-carbon economy but it won't happen without serious government involvement and more taxes from the people with the money aka the rich. The odds against that happening are similar to the odds of having $10 oil next month.
So, should I invest in a 25 year supply of freeze-dried back-packer meals?
If in 25 Year we reach a Peak in World NG production and see a Shortfall the year after, then yes in a decade we will see food production limited.
We could reach Peak NG sooner, due to the World's use of it as a Power generation Fossil Fuel. As well we could see a Peak World Food production anytime from today to some future date.
There has been talk that we have a lot of marginal lands not in food production, What you don't think about is that some Marginal lands, or Non-food crop lands, might not be able to support food production. In food production, we take away the food the plants produce and replace it with fertilizer the next year. The process goes on and on each year we take away the food and vitamins the plants make and use them elsewhere, while we replace it with outside minerals. That is what the Green Revolution is all about.
Land that could not by itself produce the bumper crops it does now do becuae we help it along. Trully Organic farming and Permaculture realy show you that the labor and thinking processes you have to go through to produce bumper crops, Is not the same thing that we do on the modern Green Revolution farm. I am not sure that we can scale the needed sustainable land use practices for the rest of the world and the 6.4 Billion people.
There was talk (thread on population) that we had the land available to feed everyone, but that is just land, not taking into account that some land is not of quality to be used as farm land.
My back yard is rocky shale and linestone over alabama red clay, it will support native plants, but to grow all my food here, I would need a lot more labor intensive work improving the soil to give me its nutrients. Some land is just sand, over bedrock, or a thin forest soil over red clays, converting all these marginal lands to food production, without heavy fertilizer imputs are near impossible.
So yeah, I would get at least a 5 year supply if I had the money. And learn about every edible native and imported plant out there, when and how to cook it and what not to eat. And I would work on growing a garden without importing fertilizers from elsewhere, grow them on your land.
The Rentech refit of the E. Dubuque fertilizer plant will also make more than enough synthetic diesel fuel to power the farm equipment to bring in those same corn crops (even if they were run off charcoal). What they can't do is make enough fuel to run everything else that we're accustomed to.
Something new: a steady-state economy. Read the books of Herman Daly. There is at least one chapter of one of his books on the web, but it is a debunking of the growth economy, not a good explanation of the steady-state one. In the books he explains why it's inevitable, how it can work, how it widely incorporates a market mechanism - but with some restrictions, and how it differs from a failed (non-growing) growth economy. The essential elements of making it work, he says, include stopping population growth, limiting income inequity, and rationing the scarcest essential resources. He was ahead of his time when he first wrote about it in the 1970's.
Cornell ecologist's study finds that producing ethanol and biodiesel from corn and other crops is not worth the energy
By Susan S. Lang
July 5, 2005
ITHACA, N.Y. -- Turning plants such as corn, soybeans and sunflowers into fuel uses much more energy than the resulting ethanol or biodiesel generates, according to a new Cornell University and University of California-Berkeley study.
"There is just no energy benefit to using plant biomass for liquid fuel," says David Pimentel, professor of ecology and agriculture at Cornell. "These strategies are not sustainable."
Pimentel and Tad W. Patzek, professor of civil and environmental engineering at Berkeley, conducted a detailed analysis of the energy input-yield ratios of producing ethanol from corn, switch grass and wood biomass as well as for producing biodiesel from soybean and sunflower plants. Their report is published in Natural Resources Research (Vol. 14:1, 65-76).
In terms of energy output compared with energy input for ethanol production, the study found that:
corn requires 29 percent more fossil energy than the fuel produced;
switch grass requires 45 percent more fossil energy than the fuel produced; and
wood biomass requires 57 percent more fossil energy than the fuel produced.
In terms of energy output compared with the energy input for biodiesel production, the study found that:
soybean plants requires 27 percent more fossil energy than the fuel produced, and
sunflower plants requires 118 percent more fossil energy than the fuel produced.
Snip ......
http://www.news.cornell.edu/stories/July05/ethanol.toocostly.ssl.html
The issue contains a number of articles on the subject, including one by Kjell Aleklett. Kjell claims that Ghawar has peaked in his article. Has this been documented?
I've been insanely busy the past few months between grad school and some consulting work with the hurricane recovery effort, so I haven't been so active in the world of PO online chatter, but I would have expected to catch this.
Kjell Aleklett was one of the people who testified before Congress on the subject of Peak Oil about a month or so ago.
Excerpt of Barron's Editorial by Thomas G. Donlan:
"Willful disregard of a law is potentially an impeachable offense. It is at least as impeachable as having a sexual escapade under the Oval Office desk and lying about it later. The members of the House Judiciary Committee who staged the impeachment of President Clinton ought to be as outraged at this situation. They ought to investigate it, consider it carefully and report either a bill that would change the wiretap laws to suit the president or a bill of impeachment."
I just read an article mentioning the UK will be monitoring all vehicle traffic 24/7 on a database. scary! UK traffic I scoffed at the idea of cameras for tickets in the UK till i was saw one myself about 8 years ago. London has a gazillion cameras around the city, scanning faces through a database for wanted individuals. And i recently recall hearing/reading an article that some agency here in the US has been compiling info on every citizen.
Does the East German Stasi ring a bell to anyone?
East German Stasi
Big Brother is here and has total control, and i hate that!
I've read somewhere there is irreversible damage to an oil well using water to extract it. The questions i have are:
The Big Valley, and is Peak Oil just a "hip cause"?
Well, we have a thread here that's sort of took on a life of it's own, hasn't it? Amid guesses that the "big die-off" could begin this year due to lack of nat gas for fertilizer, to attempts to guess whether peak is ohhh, yesterday, today, or tomorrow at 6:30PM, to assertions that predicting a high price in 2006 is now considered silly on the part of people like Goldman Sach's and Matt Simmons, and that predicting is silly in general (kind of ends the whole purpose of the Peak Oil warnings then doesn't it?), by folks who then turn around, and assure us that Simmons and Goldman have blown it, oil IS NOT going to be over 100 dollars a barrel in 2006 (gee, they are more bright and sure of themselves than even Yergin, given that we haven't even started 2006 yet, and despite the hostility to Simmons prediction (remember, 2006 hasen't even started) they show no fear of predicting!
Of course, this whole thing is a dream type argument for why the public is now discounting the whole idea of peak oil as a wild mix of doom sayers and fortune tellers....we, like the public at large, are viewed as changing our mind and loosing our commitment to our own ideas at the first sign of a low price....or, simply spouting doom that should begin sometime tomorrow evening, without any thought of the ability of the world to switch, move and conserve, making exact dates hard to pin down and exact outcomes hard to predict.
So let's look at the GREAT CATASTROPHIC EVENT. No, not the one coming, whenever it comes, but at the one we have already seen. Go to the link below and scroll to the bottom of the page. This is the famous, (or infamous, depending on your point of view) "Uppsalla Protocal" on which almost all "peak is soon" forecasts are based...now notice the nice "little" dip after 1979....looks kind of small and innocent on a chart that size, don't it?
http://www4.tsl.uu.se/isv/UHDSG/
Let's call this post, "The BIG VALLEY", in honor of an old Western TV show, but much more in honor of the big valley in liquid oil and natural gas liquids we have already seen in our history.
Take note of the "BIG VALLEY" in production from 1979 to about 1992 to `94. We had this very discussion the other day in regards to another post....that is 13 to 15 years of "post peak" liquid oil and gas liquids! It took that long to return to the old 1979 world production peak! HOW DID WE SURVIVE?
As discussed in other posts, there were (a) financial machinations, (b) Political machination (c) Fuel switching (mostly to natural gas, which won't be available as easily this time) (c) Demand destruction, by conservation and by recession and (d) improved efficiency.
What this means is that for 13 to 15 years, there were declining liquid fuels production from the prior peak!
And guess what, there was no "big die-off" there was no catastrophic food production drop, there was, despite a very hard economic situation, no "collapse" of the world economic system.
HERE'S THE NEWS THOUGH: IF THE DECLINE IN FUEL PRODUCTION HAD CONTINUED.....past 13 years, past 20 years, past 30 years....(???) HOW LONG WOULD SUCH A SITUATION HAVE BEEN SUSTAINABLE?
No one knows. But we can imagine that many of the ideas that were laughed out of the public square in the early 1980's (passive solar, photovoltaic power, wind, conservation, electric and efficient cars and trucks, high speed efficient rail service, on and on) would have been greatly more accepted. IN THE 1970'S, WE WERE NEVER REALLY TESTED. The flood of Arab oil, (including the export of our power and money to get it) and the miracle of the British and Norwegian North Sea (more export of our power and money) allowed us to get by with complete abandonment of energy efficiency and alternative technology. The flood of natural gas made us certain that we "had a century left" of natural gas, we could turn to the "clean fuel" the cleanest of aces...even for cars and trucks if need be! We never noticed that if we tripled consumption we would cut that century to barely 30 years supply. Well, the clock is running. But the change won't happen in a day, and we surely have at least a few days to go before the big die off! There is still natural gas in large quantity in the world, and will be for a long time, and there is still crude oil in the world and will be for a long time.
BUT, ON A DAY BY DAY, YEAR BY YEAR BASIS, MAKING SUPPLY MATCH CONSUMPTION...(????)
So no, to answer one posters question, this probably won't be the world's last Christmas with Christmas lights (but I would go with candles, just to start a less consumptive habit!), and yes, we may still be able to get food next Christmas too (although it may cost more...)
Today's "spot price" or tomorrow or yesterday's "spot price" matter little...it is the trend that counts, over the long term, 5, 10, 15 years...
How many on this very board, if they do not see crude oil prices go over $100, $150 a barrel, or natural gas at $20 bucks a million BTU will lose heart, "Well, we were wrong, there is no emergency...and here i have made the sacrifice, and conserved, while my neighbors who thought it was all stupid doom talk have big SUV's and motor coaches, and GIANT houses...they burn oil like it will never run out, and I did without! "That's it! Screw this doom talk! We were wrong, there's plenty, and there will always be plenty!" "You and your "Great Pumpkin" story, I have missed the party!"
And then...(???)
In the stock market, they often say that the market will turn only with complete "capitulation".
I will worry most when even those who worry have given up and gone back to business as usual, and when "peak oil" or "depletion" cannot be found as a topic in any magazine, when even the doom sayers have gone back to the big house and the SUV, and view the "peak" as just another "hip cause"...when they have all capitulated. Then, I will really worry.
What will be the best investment in PO era?
I read about Richard Rainwater who made great investments and profited by them.
But what are the best investment at this point?
I believe the best investment may be:
#1: Buy OIL,Soybean future
#2 Buy diodiesel company
#3 Buy gold and oil stocks
These are the general guidelines in PO investing,but I like specific ideas so we can actually profit by them