Tuesday open thread

Happy Valentine's Day. We luv you too.

(Here's a link in case you need any fodder...)

Update [2006-2-14 13:59:43 by Yankee]: And yet more fodder: U.S. Has Royalty Plan to Give Windfall to Oil Companies

WASHINGTON, Feb. 13 — The federal government is on the verge of one of the biggest giveaways of oil and gas in American history, worth an estimated $7 billion over five years.

New projections, buried in the Interior Department's just-published budget plan, anticipate that the government will let companies pump about $65 billion worth of oil and natural gas from federal territory over the next five years without paying any royalties to the government.

Based on the administration figures, the government will give up more than $7 billion in payments between now and 2011. The companies are expected to get the largess, known as royalty relief, even though the administration assumes that oil prices will remain above $50 a barrel throughout that period.

Energy Outlook Bleak

Michael Zenker, a global gas analyst with Cambridge Energy Research Associates, said natural gas reserves around the world and in America would be the only energy resource that could fill the gap between supply and consumer demand anytime soon.

He warned that not tapping world supplies in places like Indonesia, Yemen, Qatar, Algeria and Russia, or building infrastructure like coastal liquefied natural gas terminals, could prove disastrous for the American economy.

"We were lucky this winter," Zenker said. If it was colder around the country, "we would not have had enough gas supply to meet industrial demand."

...Chris McGill, an analyst for the American Gas Association representing petroleum distributors at the meeting, said an increase in the supply of natural gas is probably not coming anytime soon, and that no other resource is in a position to make up the difference.

"LNG is plan A," McGill said. "There is no plan B."

If LNG is our plan A and we have no Plan B, we really are screwed.

Andrew Weissman took looked real closely at the implications (financially) of a massive LNG strategy

The potential 2025 contribution of LNG imports to the U.S balance of payments deficit is potentially 1 to 2 X the current total U.S. balance of trade deficit, which is at an all time record level (viz., $ 58.3 billion for January of 2005, the most recent month for which data is available). Even for a country with a $ 13 trillion per year Gross Domestic Product (GDP), these are staggering figures.
Over the 20 to 25 year life of these new supply projects, the required payments by U.S. purchasers are likely to total more than the budget for the entire federal government (with over 2.5 million employees) in any one year.

Or the liklihood that supplies will materialize as anticipated

Despite the overall strength of the U.S. economy, the U.S. could be at a significant disadvantage in competing
for these supplies.

We are running the largest trade deficit in U.S. history - and the largest trade deficit of any country in the
world. In part as a direct result, the value of the dollar is expected to continue to decline sharply over the next
several years.

Further, because of our location, for every current producer other than Trinidad, the amount of time a tanker
must travel in order to complete a delivery to the U.S. and therefore the cost of shipping LNG to the U.S.
market is significantly greater than for any other potential customer except Mexico. With tankers potentially
costing up to $ 250 million each, this is a significant disincentive to sell into the U.S. market.

It also means that, by definition, a U.S. manufacturer using LNG will be at a competitive disadvantage to almost
every other manufacturer worldwide, since (due to the shipping cost differential) the cost of LNG delivered to
the U.S. market inevitably will be higher than in any other market in the world.

Or the susceptibility to interruptions this would place us in.

If we rely heavily on LNG imports from West Africa or the Middle East, therefore, and the government in a
host country is overthrown, a strike temporarily shuts down production or, in the case of a Middle East
producer, shipments through the Strait of Hormuz are temporarily blocked, there may be a very real risk that
we'll not be able to keep homes warm in the middle of the winter or that the lights will go out in the summer.

Even if shortages never occur, however, from a pricing standpoint, the potential consequences of a supply
disruption in the LNG market, even for a short period, could also be severe - even if it involves only a single
major LNG project supplying the U.S. market.

THe article is a good read.  LNG really makes no sense as a solution, except to the LNG distributers.


shouldn't that be "wuv" Yankee?  :)
Maybe if the subject were "I", but "we wuv" just doesn't read right...
Yes, it sounds like you lost your two front teeth.
Or only have two (Bugs Bunny).
I was thinking this morning that it would be interesting to conduct a poll on this website. I figure there is an easier way than just a string of replies to an open thread.

But my idea for a poll is this? What is your view of the net result of Peak Oil. 5 categories ranging from no effect to stone age by 2025. Then what time frame do you envision the net result happening. 5 categories of time frames for that. Then make a nice little matrix of the two.

I just think it would be interesting to see where everyone falls out in the matrix. What's everyone think?

Could be an interesting idea. But you would have to be very careful is depicting your effect "categories." For example, I believe that progressing to a stone age height would be a vast improvement over our current civilization, but not everyone would agree.

As for timing, by 2025 I expect no more than "the greatest depression" - whereas I hold out hope that by 2100 we will have made it to the new stone age.

I'm posting this in response to Matthew Lynn's piece in Bloomberg News.

He said:

Yet raise your eyes from the day-to-day chatter, and the market is more stable than it has been for a long time. The price won't collapse, and it won't soar either. There is nothing trickier than calling the top of a bull market. For oil, however, this looks like it.


Two comments:
  • I'm always careful when looking at a moving average, you have to apply a shift of 13 weeks (3 months) to the left because sliding windows are not centered.
  • there was also a plateau in may 2005 but the prices continued to increase afterward.
The way I see it, the 26-week average today is simply a representation of the past 6-months of prices and to some degree the cumulative effect of those prices on the economy.
Same thing they said about the San Andres Fault.  In the FX markets, the biggest moves are always made from the flattest lines.  How long was oil at 20?  

At least thats the catastrophic theorist's viewpoint... all those hidden stresses building up for a break to a new attractor (temporary equilibrium) point.

For those on TOD from the Pacific Northwest, this may be of interest:

For Immediate Release

Date of Release:  Feb. 14, 2006

From:  Willits Economic LocaLization (WELL)

Contact:  Spring Senerchia, 707-459-1256; spring@redinet.org

Subject:  Regional Localization Networking Conference

Improving and coordinating the efforts of groups working towards sustainable, localized economies is the focus of a conference to be held in Willits, CA from April 7-9, 2006.  

The conference aims to share best practices on group organization and activities, develop consistent messages for the public, politicians and business leaders, and foster on-going communication among localization practitioners.  A Saturday evening presentation by David A. Schaller, Sustainable Development Coordinator of the US Environmental Protection Agency is included in the weekend activities.

The "relocalization" movement is especially active in Northern California and Oregon (see:  http://postcarbon.org/_tmp_maps/NorthAmericaOutpostsImageMap.html), and while anyone is welcome to register, preference is given to attendees from this region.  Each local group is encouraged to send one application form with a list of delegates to the conference.  These forms are available at:  http://www.willitseconomiclocalization.org/RLNC.pdf

Willits Economic LocaLization (WELL) sponsors this event.  WELL's mission is to foster the creation of a sustainable economy based on local resources.  (See:  www.willitseconomiclocalization.org).

Hi All,
I find it interesting that there hasn't been a thread yet on James Lovelock's dire prediction about climate change, as published in the Independent on Jan. 16 (unless I missed it?):

Posted on Energy Bulletin - "The world has already passed the point of no return for climate change, and civilisation as we know it is now unlikely to survive, according to James Lovelock"

His book Revenge of Gaia is not due for publication in N. America for a month or two, so I suppose that has something to do with it. Still, his views have huge implications for a post-peak-oil society - especially since some think we're going to have to rely on coal for a myriad of uses for a time. Imagine the additional environmental havoc! Anyone read the above article yet? Thoughts? It's brought back that acute sinking feeling in my heart and stomach that I carried around after I found out about PO...I guess I got used to it. My brother has 3 little kids and it gives me shivers to think about what their adulthood will be like. What my "golden years" will be like...

I haven't read the book yet, but the shorter summaries of his argument on the web don't make a lot of sense to me. There's a nice essay on it over at Real Climate. They're fairly sceptical too, but of course their scepticism is better informed.
Saying we are past the point of no return will be pounced on by the business as usual crowd. It is like telling someone dieing of lung cancer to quit smoking. It wouldn't do him any good to quit now so let's keep smoking those fossil fuels. Anybody got a match?
Civilisation a century will be very different than now just like civilisation now is very different than 1906. Life for the average person could be much better than now.
I kind of like this idea:


Well, except maybe the chickens.  Bird flu, y'know.  ;-)

Seriously, it seems like a reasonable way to cover your bets, without spending too much money.  If the energy crunch doesn't start to bite for 50 years, you haven't given up your job, etc.  If the zombie hoards are roaming within five years, well, at least you have neighbors to help you defend your vegetable patch.  :-/

Bird Flu...Hum.. I am planning on adding chickens this spring as the easiest way to add a ready source of protein. Last year I replaced some flowers with vegetables and hope to expand that this year. My chickens will be laying hens of heritage varieties as I can see myself getting too attached to ever butcher them! I though about the bird flu angle a lot. But it seems that avian flu is primarily spread by migrating water fowl and is not in the songbird population. I am not near any waterfowl flyways and my toney neighborhood does not have any other farm animals for miles. I live in what was once farmland and my little patch of ground is still zoned agricultural although I am now surrounded by MacMansions. Hopefully I will be able to vacinate my chickens against avian flu as a precaution; I understand that chicken vacines have been developed.
In Europe, the order is vaccinate them and to keep them in a totally enclosed house or pen (with side and overhead chickenwire) so they can't mix with the free rangers.  Lots of complaints about building the required structures.
I have to have wire pens with mesh overhead anyway, because I have two pair of hawks nesting in my woods......
Two thoughts on this...
Having actually kept chickens for a few years, they seem to react in enclosed spaces much like rats and humans-- they start tearing at each other's feathers and generally exhibit stress due to crowding.  Our chickens, (circa 1997-2000), were free range during the day, were absolutely healthy and produced eggs too large to fit in a carton.  Our rooster seemed to keep them all safe in a habitat that included dogs, coyotes, feral cats and snakes.  (They also all had names and distinct personalities).
OTOH...all the avian flu sites I keep up with report today of confirmed cases as far north in the EU as the Baltic Sea.  I have no idea if the vaccine that the Asian countries are using is effective or not, at this point, but I would think that sooner or later federal action/local hysteria would demand that you cull.  I think it's pretty iffy right now.
Things not looking so comfy with Cantarell:

Mexican oil output could drop sharply - report

Re: IEA, Lynch
High prices have bolstered investment that will lead to a 2.2 million-barrel-a-day increase in the amount of oil that can be produced, the Paris-based International Energy Agency said. Global consumption will rise 1.78 million barrels a day. Prices plunged this week after the Energy Department said U.S. oil and fuel inventories were above normal for this time of year.

``The IEA report confirms the bearish sentiment in the market,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``Inventories are more than adequate, but geopolitical worries have been supporting prices. We haven't heard anything inflammatory from Iran's president recently.''

When was the last time IEA said oil supplies would stay flat or drop? Michael Lynch is bearish on oil prices. Well, that's news! So, why is the G8 so worried?
With booming growth in China and India absorbing oil, attention has been focused on the effect of rising demand in pushing up oil prices. The Group of 8, a club of the world's richest capitalist democracies and Russia, meeting Saturday in an icy, mist-covered Moscow, focused instead on the extremely tight supply around the world.

"We're all concerned about the risk of rising energy prices and what they do to global growth," John W. Snow, the United States treasury secretary, said after the meeting at a hotel....

Oil-importing countries, including the United States, would like to see producing nations increase supplies on world markets, easing prices even as China and other quickly developing economies burn more oil.

A recent jump in Russian oil production -- by 10 percent or more a year at some companies -- compensated for growth in Chinese demand early this decade. But overall supply is expected to grow only about 2 percent next year.

Now, where exactly is that 2.2/mbpd coming from? Only the IEA knows. And consumption will be an extra 1.78/mbpd. So, that's a whopping spare capacity of 0.42/mbpd. And that, my friends, is the reason why inventories are so high. Everybody is guarding against supply shortfalls. Then these clowns turn around and drop the price because inventories are high.

I ask Shaw's question. Are Humans Smarter than Yeast?

"And that, my friends, is the reason why inventories are so high. Everybody is guarding against supply shortfalls. Then these clowns turn around and drop the price because inventories are high."

Bingo!  The basic model of how the market works, esp. in terms of the role played by inventories, is changing as we (s)peak, and the commodities traders haven't noticed yet.

With the news that Iran has begun centrifuging uranium, plus all the oil and natural gas stats everyone here can cite ad infinitum, one would expect the market prices of oil and NG to be significantly higher.

It will happen, eventually, but the sooner the prices start to rise before there are supply disruptions, the better.

I agree Lou.

People are just trading on trends and perception.  I am more convinced than ever that only a shock, due to scarcity, will wake people up to how fragile our supply is.  People just expect energy to be there, no matter what the cost.  And if there is any surplus in storage than the price has to go down due to over supply.  No thoughts at all about our need 1,2 or 3 months ahead.

At this point I truly do not think most people can comprehend scarcity.  It might get expensive but if I borrow the money in winter "they" will deliver my gas or oil.  I will pay for it later.  If everybody has this mindset, price is not going to do much in the short run to prevent scarcity when demand finally overtakes supply.  

We have been lucky this winter.  What about next winter when supply will be even tighter?  I worry about the herd mentality.  Everything is just fine now but could turn to panic very quickly with a shock.

Makes it a good time to re-fill the SPR, though.
That's exactly why shocks occur.  Tell me anything of significance that happened gradually other than biologic evolution.  I take it back, supposedly the dinos died off in just a couple million years or so.  Short geologically speaking.  Maybe you could even call bioevolution gradual, at least until man hit the planet.  Hell, even evolution's gonna' change soon.  Now that I think about it... the, "Slow Squeeze", must be a toss-away scenario.  The slow squeeze part is what's happening inside the every day to day white noise.  When something pops, it breaks out of the noise and ... then the lemmings get it .. thats when its run for your life (or death, as the case may be).
Well, how many "1929s" where there in the 20th century?  How many fuel crisises?  How many real estate crashes?

A handful, at most, in a century.

We are driven to understand the "breaks" but "continuity" remains both the norm, and the statistical answer.

Good point. The bit with the "budget plan" where payments are spread out only hides the scarcity - and gives companies a chance to bilk consumers. A lot of my coworkers are on that "budget plan" which is really a case of what I call creative financing. One of those laws of economics I noticed is that increasingly creative financing only raises the price of the item financed. Housing and new bizarre loan schemes come to mind.

Those coworkers on the "budget plan" aren't thinking about scarcity at all. They figure on "pay them and it will come"! This with "budget plans" or any other creative financing should be outlawed so you pay as you go per month, just like your car and the dreaded gas pump. As we know here, NG is not exempt from peaking and scarcity.

BTW, I have thought of a way to ship natural gas with normal oil tankers. You make it into diesel. You can use the diesel to heat homes, use it in transport systems, etc. Some NG at origin point can be made into gasoline for cars. No need for going around with LNG as cold as liquid air. Time to re-nozzle home heating systems... again! Yes, you waste petroleum energy in converting NG to heavier hydrocarbons, but no need to waste energy again to heat a ridiculously cold liquid. And oil tankers aren't as tempting as LNG tankers.

Why is any fuel needed to reheat a cryogenic fluid. Fuel is needed to keep it a liquid in transport but at the regasification point all that is needed is a large heat exchanger with the wind blowing through it. It could even be used to chill water for a large air conditioning system.
You're right -if you want to reclaim the energy of refrigeration. Your idea of using the cold to do a giant A/C system will work. But alas, the heat to be added will likely outstrip the heat sink needs of any A/C system I can think of, except for a BIG LOX plant at a spaceport. Since spaceports don't exist or citywide chillwater systems for that matter, some energy ends up being wasted to heat the LNG, even seawater pumps to use ocean water to dissipate the cold.

What a waste. Energy to chill NG to cryoliquid, energy wasted keeping it cold, and energy wasted to reheat it. That's why we would be better off making the NG into room-temp liquid and load it onto existing tankers. If you need room-temp gas fuel, you could convert methane to ethane or propane which can be held liquid at room temp albeit pressurised. For "natural gas" users, ethane would work out best. Pump out the liquid from the bottom of the tanker, and let it reboil in the pipe. Doing that with a cryoliquid would create artificial permafrost!

Anybody out there involved with coalbed methane, landfill gas, or anaerobic digester projects in/around the Northeast US?  I'm trying to find out if there is a real demand for developing these kinds projects right now, or are the ones that exist mostly in a research stage.    
COUNTRYSIDE POWER INCOME FUND has mostly US landfill gas project in their portfolio.  ALGONQUIN POWER INCOME FUND has a nice interest (perhaps 10%) in US landfill gas projects.

Both would proably be commercially interested in any specific project you have in mind.

No specific project in mind, I'm just looking into possible new ways to use my civil/environmental engineering skills.  Right now my company is mostly focused on redevelopment projects on contaminated sites (including landfills), but we have a lot of skills that I think are applicable to methane generation/recovery projects.  This could be a new source of clients/work for the company if there is really a demand for it.  Also, it could be a way to keep the business going to some extent if the re-development work drops off due to higher energy prices.
Replying to Ridge on anaerobic digesters.  I have been working on anaerobic digesters and "bioreactor landfill" landfill gas projects for 35 years now (you can "google" Yolo County California Landfill and bring up a lot of stuff.  My initials are DA.  And that is only a small part of the stuff for illustration).  

Landfill gas  Over 1000 MWe of electricity are being generated today from landfill gas, referred to in the waste landfill trade as "LFG".  It can readily fuel piston engines and turbine prime movers. Potential is for 3-5x this via better technology, which is coming into play at Yolo County CA and elsewhere.  Thus the US potential for landfill gas is between 150,000 and 250,000 barrels oil equivalent (BOE) per day.  Plus you are addressing global warming by more efficiently recovering  methane that is tenfold the potency of carbon dioxide on a volume basis.  The energy potential is large simply because of the large amount of waste > 150,000,000 tons of largely organic material that the US landfills each year.   This much waste can make a lot of methane. Without getting into detail, I will just say that, in essence, there is still a lot of potential for more development and optimization of LFG technlogy.  There are problems to be overcome--for example effects of gaseous silicon compounds (of all things) that leave deposits in combustion systems.  

Sewage  Methane from sewage is about 20% of the energy potential of methane from LFG. and use is very roughly 50'% of the amount collected

Manure  The biggest developer of manure digesters in the western hemisphere has been RCM digesters and Mark 'Moser of Berkeley/Oakland, who we (IEM, Inc and Yolo County) talk to regularly.  The exploitation of manure to methane is much less advanced than LFG, with the exploited potential of manure methane (or biogas) being under 5% , but the business today is booming, such that there is a large backlog for RCM and others installing digester systems.  Manure solids and convertibility make the methane potential roughly 2x that of landfill gas

These biomethane sources are to date best suited to local use and primarily electricity genration, although  a little bit of pipeline gas is made. In our big study for California Dairy farmers we document the use of biogas in fueling vehicles in the 'European Union.  Google Westen United Regional Dairymen (WURD) and methane.  

Steve Andrews of ASPO-USA has called these technlogies "silver bb's"  which is a great term for energy resource that is smaller than a silver bullet.  

Based on manure, sewage and solid waste solids available to make methane, I would give the net energy potential of these resources together at over 500,000 boe per day for the US. The climate benefit can be enormous because of methane's greenhouse potency.  In addition atmospheric methane is also connected in a complex way to the Antarctic polar "ozone hole" (Blake and Rowland) and there are a lot of other angles to this.

Just viewed a DVD release of the 1973 classic "Soylent Green" starring Charles Heston and Edward G. Robinson.  The director commentary included in the special features was particularly interesting.  Most depressing is that awareness was raised in the 1970s by this film, the oil boycott, books on ecology and the environment, etc., but little effective action resulted. Yet here we are again, the issues and consequences better defined than ever (thanks TOD!), and yet the inertia of society seems to relentlessly propel it towards a "soylent green" future, or worse.
Hence J. M. Keynes' observation about the short run being all that matters because in the long run we're all dead anyway.

This is why we need education about our energy situation and good public policy--to fight the natural tendency of people to focus on their immediate sitution and not extend their planning horizon.

I am beginning to become bored with being a pedantic old fart, but shucks, character is fate:

Keynes never said the long run does not matter. He made a one-liner put-down quip.

Keynes thought that the long run mattered most and that in this long run the decisive elements were technological advances and exponential growth.

See his classic essay, widely republished, "Economic Possibilities for our Grandchildren."

JMK, where are you now that we need you?

For those interested in the future course of the economy, Dave Altig's Macroblog puts out an analysis every Monday of what the Fed is likely to do with interest rates at its next couple of meetings. Turns out there are financial markets where people can in effect bet on what the Fed will do, and Altig massages these figures and puts them into easy-to-read chart form. The latest results are here:


and predict that the Fed, under new chairman Ben Bernanke, will continue to raise rates a quarter point at each of its next two meetings. This is a little more "hawkish" behavior than had previously been expected, when the Fed was thought likely to level off after maybe another raise.

JDH at Econbrowser is among those who fear that the Fed is going too far too fast, and that its inflation-fighting zeal is only going to succeed in sending the economy into recession. Supposedly though Bernanke means to quell worries that he will be too soft on inflation by putting on a show of toughness right off the bat.

If things go bad as JDH fears, a U.S. slowdown would likely impact the rest of the world as American imports are a major economic driver these days. This could lead to a scenario with a softening of oil demand and a drop in prices over the next couple of years.

IMO he's doing the right thing. Better cause a slight recession now, but "preemptively" force a gradual reduction of the enormous debt that is threatening to send the country in the third world virtually any minute (what do you choose? a currency crash? a stock market crash? anyone?).

As for oil prices a dollar appreciation will hurt oil importing countries and this will be another source of reduced demand. So, yes it is quite possible that we see a significant price drop - in the next few years supply capacity will probbaly remain flat, while demand will probably drop much faster. I don't see it as a good thing though.

Peter Tertzakian, author of A Thousand Barrels a Second: The Coming Oil Break and the Challenges Facing an Energy Dependent World, is the guest on the Daily Show tonight (Tuesday).

The Daily Show is anchored by John Stewart, also known as a fake news anchor.  The show is meant for comedy...it is shown on the Comedy Channel.  But, the show has much "real" news at the same time.


Stewart is the only fake news anchor that admits it.
Thanks for the tip!  I hope I remember to watch this.  
Hey, has anyone read this book?  

There are so many peak oil books these days I can't keep up.  I never even heard of this one before.

(And are we really using a thousand barrels a second?)

84,642,000 (May 2005) per day is equal to 980 per second.
I bought it yesterday (and posted a snippet I liked, repeated below).  It is striking me as a good moderate argument for concern, without being (or saying) "peak oil".   It does mention Hubbert and Hubbert's peak.  From Chapter One:

We're not running out of oil. There is plenty of oil left in the ground to last us many decades, if not longer. We are, however, running short of cheap oil, especially the desirable grade of oil that flows easily and is devoid of sulfur, otherwise known as "light sweet Crude." Our reliance on that cheap oil runs deeper and is more entrenched than most of us are aware, and because its supply is getting tight at a time when global demand is accelerating, a great change is underway that will put pressure on our lifestyles and our world.

I just can't get over how this guy reinforces ideas that I've picked up by osmosis.  So, of course I like it.  One example of that was my suspicion that the major independent oil companies were not heavily reinvesting because all the good investments were covered.  He notes ... well I won't do a long excerpt, but I'll do some fragments from Chapter 4, which I'm now reading:

Concentration of risk, which includes corruption and all the components of political risk, manifests itself financially in terms of higher return on investment requirements, known as hurdle rates.  The higher the risk, the higher return necessary to make the investment worthwhile, the greater the hurdle.  Large oil companies that invest in Canada (a substantial exporter with little political risk) often use a hurdle rate of around eight percent after tax.  This means that for every $100 they invest, they expect a minimum net return of $8.  No independent oil company will risk its people, equipment, and money going into places like Venezuela, Libya, Indonesia, or Russia for a measly eight percent return.  Anecdotally, an unwritten requirement of at least 20 percent return (and rising) is required to offset that kind of uncertainty [...]

Put another way, the increasing risk dynamics no longer support viable, free-market economics at the historic $20 a barrel.  What is supportable [...] My readings, calculations, and anecdotal discussions suggest that there is little incentive now below $40 per barrel, and even that may be low.

He goes on to say 9 of the top 10 oil companies by reserves are now state owned (NOCs - National Oil Companies).  The places independents (IOCs) can invest are limited.

He goes on to say that when NOCs invest, they may use a calculation that has less to do with short term profit, but more to do with securing a strategic supply.  This further limits the ability of IOCs to play.

IMO, buy the book.

I just bought it on the way home after you mentioned it. Looks like it might be one of the better books on the subject(s). Lots of Charts. Thanks for the heads up.
I've read most of the recent, popular books on "oil." I've only read the 60 pages in Chapter 4 of 'Thousand,' but I would say that chapter alone is as good as any of the other books.

The chapter focuses on supply and demand of crude, discusses peak oil, politics, American vehicle miles and efficiency, Russia - very well done.

I also saw him on John Stewart tonight. I'm not sure that this topic does well in the comedy spotlight. It took backseat to Dick Cheney jokes. But the exposure is much needed and appreciated. Thanks John.

He was on NPR Science Friday on Feb 3, right after the SOTU.
Here is the link to the show, which has an audio link.


He was very concerned about the lack of any mention of conservation.

Thanks, I'm listening to this now.  If you know the backstory, Mr. Tertzakian's frustration is interesting ... and you wonder why no one else on tbe show picked up on it, or understood it.

He's saying (as I type now) that people should not be conditioned to think "don't worry, go on about your lives, the scientists are going to fix it."

just got done watching it... I wish he would have said peak oil, but I think he conveyed the the problem fairly well... although, seems a little optimistic, especially with his comment regarding going from whale oil to rock oil... I'm not sure we'll find something that will do the same in allowing us to go from something good, to something better... or, in this case, best to bestest.
I wanted to make a comment about the terms "supply" and "demand". Economists have a specific meaning for these. Supply and demand are not values or amounts, they are functions. To a first approximation, supply and demand are functions of price, meaning that they can be expressed as a curve or graph showing how much would be supplied/demanded at each possible price. These terms should always be thought of as being used in a sort of hypothetical or counter-factual way, as a tool to explore what might happen under various possible conditions.

Unfortunately people also use the terms confusingly to indicate actual amounts bought and sold during some period. People will say that oil demand last year grew by x percent, a decrease from growth the previous year. But that's not correct. You can't speak of demand that way. A better term would be "consumption". You can say that oil consumed last year grew by x%, but you can't look at the data and say what demand was. Demand by its nature involves a range of possible outcomes.

It is better to think of supply and demand as forces that tug on prices, than as amounts. When demand is high, that pushes prices upward. When supply is high, that pushes prices downward. And vice versa, low demand draws prices down and low supply draws prices upward. Think of the price as a weight suspended with springs above and below it, where the springs are supply and demand. Stronger demand raises the price while greater supply lowers it.

If we think of supply and demand in this way, then it makes sense to say things like that demand next year will grow over this year, while supply will grow but not as much. And this allows us to understand some paradoxical conditions. Demand could grow from one year to the next, but consumption could fall, if supply were tight. The common usage of saying "demand" as a synomym for "consumption" makes it impossible even to describe this situation!

I hope people will bear this in mind when they read economic analyses and reports. Supply and demand are forces that affect price. But when we are looking at actual amounts in the past, that's not supply and demand, that's production and consumption. Keeping this distinction in mind makes it easier to think clearly about what is happening.

As one who has taught Introduction to Economics and Priciples of Microeconomics over 180 times over thirty-one years, I applaud your effort to clarify issues that confuse about 99% of journalists and (apparently) about half of the people who post on this site.

Words are tricky symbols to use to get across ideas of supply and demand. Word's plus graphs are much better, but the problem here is than many people are as afraid of graphs as they are of calculus.

Alas, I know of no substitute for rigorous study. Is there a book titled "Economics for Dummies?" Probably there is, and if so it would be a good place to start.

For economists these ideas are simple and clear; we know that there is a world of differnce between "demand" (a whole schedule of prices and quantitities, other things staying the same) and "quantity demanded," which is the amount purchased at a particular price--what you call "consumption."

To conclude, there is no substitute for solid education. You can learn economics on your own, but for many people it is about as hard to learn as Japanese.

Ok, if I put it in Dummies' language:
  • Demand is what you want
  • Consumption is what you get
I am sorry, but that is absolutely wrong.

The concept of demand includes both the willingness ("want") and the ability to pay. You can want something with all your heart and soul, but if you have no funds and no credit, your demand is zilch.

Not for nothing is economics called, "the dismal science."

Ok, fine:
  • Demand is what you want and can afford
  • Consumption is what you get
When there is demand but the demander has no money, it's called "pent-up demand". I have noticed four "laws" of economics, suitable for an "Economics for Dummies" book:

  1. You cannot sell product to people without money. (example: there is no Lexus dealer in towns full of trailer parks)

  2. Unrestrained advertising inevitably ruins the medium where it exists. (example: email and spam)

Corollary to second law: If a means to filter advertising in a medium is possible, advertising will follow a Hubbert-like curve as people to be reached are "depleted" by adopting filtering. (examples: the no-call list, TiVo, etc.)

3: Increasingly creative financing raises the price of the item financed. (examples: housing market and wierd loans, NG "budget plans")

And you'll love this one...

4: As a region becomes a net importer of an item, the region expierences a price rise to match the prevailing price. (example: The Lower 48 as a net oil importer)

I used to debate economics on Usenet in the 1990s a lot, as well as discuss the oil peak.

It's easy.  Just remember to say "quantity demanded" when you mean the "demand" you see in the real world.  That keeps the economists happy.

If you ask me, they stole a perfectly good word out of the dictionary and bent it to their own purposes.  Coincidently, it is happening again right now as economists go into "happiness studies" and re-create "happiness" as a sort of quantitative well-being.  Cato Institute and others are into this, because if you make "happiness" quantitative, then by near-definition it goes up with GDP.

Of course they might loose, and the brain scanners might be able to hold onto "happiness" as an authentic mental state.

According to a mathematical/engineering definitions:

A Volume is a Scaler Quantity of something that (usually) remains constant throughout the relative time of interest. It has representative units of BBL, CF, MCF, M^3, US Gallon.

A Volumetric Flowrate is a certain volume of something relative to a given time interval.  It will have representative units of BOPD, CFS, CFM, GPM, MCFD.

When the time interval of Volumetric Flowrate is becomes  infinitesimally small in relation to a much larger time frame of interest, it is referred to as an instantaneous Volumetric Flowrate, and is equal to the derivative of a volumetric quantity with respect to time, as the time interval approaches zero.

The integral of instantaneous Volumetric Flowrates over a given time interval will yield a Volume.

It doesn't matter if it is something somebody produced, something somebody buys, sell, or just wants it.  

Economic Definition:

A supply is a given quantity of something of value to a potential seller.
A demand is a given quantity of something of value to a potential buyer.
Where the something is produced, or by whom, or where the something is consumed, or by whom, makes little difference.

When a given buyer and a given seller agree on the value of a given quantity of a given something, sometimes the ownership of the something is transferred from one entity to another entity at a probability of 50%.

It has long been noted that the probability of a quantity of something changing ownership between the owner of the quantity of something and a prospective owner of that same quantity of that same something can increase or decrease when each do not share the exact equal idea of the value of the given quantity of the given something.  

The probability of changing ownership of a quantity of something has also long been noted to increase as a function of the algebraic difference between a prospective owner's idea of the value of the quantity of something and the present owner's idea of the value of the same quantity of something.

Collarary 1)  There is no further interdependency or any other relationship that has been found to exist between the two definitions.

Collarary 2)  Any attempt by anyone to further quantify or relate the difference in value of some quantity of something to a price related to some form of legal tender currency, or a similar or dissimilar transaction involving similar or dissimilar quantities of something, having been taken before, or is scheduled to take place at a future date, or at any other moment in time, other than at the exact moment the given transaction for the given quantity of the given something, is consumated by the given buyer and the given seller, identifies that person as a soothsayer and a fool.

I am sorry, but your definition of "supply" is quite wrong. Please consult a reputable economics text.
Don't have a reliable one.  Do they exist?
I did Google it though;

products online ready for same day shipment, real-time pricing, ...

Go to bookstore near major campus. Buy old edition of big econ book, maybe published by McGraw-Hill or Prentice Hall or Irwin. Does not matter much which one. Read. Ask questions.

Alternatively, if you want a really fine book, get any edition of Stigler's "Theory of Price" or any edition of Marshall's "Principle's of Economics."

Often older editions are better than newer editions, because the publisher's make you dumb them down. Been there.

Some of the best graphs are to be found in old editions of the classic text by Samuelson, 1st edition, 1948, still in print with a co-author. He had a really good chapter on energy back in the early seventies edition, then dropped it as energy prices fell in later years.

My favorite text for principles of economics is the one by Colander. Any edition is fine, and in fact 1st edition has good stuff that the publishers forced him to delete in later editions.

There are a ton of decent paperback books for the one-term Intro to Econ course--old ones maybe sold for 25 cents on tables put on sidewalk outside.

Most novelty is error. Glance through some books, and you will be able to tell which one is right for you.

"Most novelty is error."
Sounds like Bill Bonner ("Secrets of the Near Dead") or Nassim Nicholas Taleb (Fooled By Randomness).  
Just a layman's view of economics that believes 90+% of New Era/Paradigm "stuff" (in lieu of my normal language) ranks lower than pond scum.
Don, I thought my definition would work for the context of my example.  Apparently you know otherwise?  How would you change it to suit that example?
To answer your question--and it is a fair and legitimate and good and important one--would require approximately two hours of class time, the study of at least four pages in a textbook, and at least three graphs--more likely four or five.

You would not expect to learn and understand and realize the awesome power of the three laws of thermodynamics in two hundred words, now would you? To understand what is meant by the powerful concepts of supply and demand requires about as much effort and struggle and concentration and study of pages as to understand the laws of thermodynamics. Just as the uneducated frequently (usually?) misuse the concepts of thermodynamics, so also do the uneducated misunderstand and misuse the concepts of supply and demand.

With the benefit of hindsight, it was a huge mistake for economists to appropriate common words in the English language and then give them special and extremely precise and unique meanings within the discipline of economics.

There are at least four good ways to communicate ideas about supply and demand. First is words. Few economists can write their way out of a brown paper bag, and their words often are not helpful at all. Graphs are good if you label them properly and understand that "graph" is shorthand for "graphical equation." Anything expressed as a graph can also be expressed in mathematics, and if you are good at math this is an easy way to go. A fourth approach to understanding supply and demand is through tables of numbers. Any graph can be looked at as plotting a table of numbers. Any equation can be thought of as describing a table of numbers. Personally, I like this approach, because in the real world the data we actually work with comes in the form of tables of numbers: Real economists love to wallow in the data, and the raw data comes in these huge computer printouts of tables of numbers. For example, Alan Greenspan does not think in terms of graphs, he looks at the numbers and in his head makes sense of them all. (Note: this ability is extremely rare. Greenspan seldom even has to scribble numbers down on the back of an envelope; he apparently can remember accurately and integrate in complex ways at least 5,000 pieces of data in his head--and do it quickly and almost effortlessly. The only other economist I know of who could do that was the late great Sumner Schlicter, who died perhaps half a century ago.)

What to do? Learn economics. It is as important as physics and about as hard as physics to learn to do right.

But where economists go wrong is to make excessive claims for the power of their discipline. With physics or chemistry you have great power to make correct predictions and to make and do things. Economics has roughly the power of meteorology and climatology to make successful predictions. In conclusion, it is worthwhile to learn to use words correctly. (And deep in my heart I wish that people would not use words without knowing their correct meanings. As a writer I worship at the altar of language and correct usage. I am a crazy old idealist, and I am not about to quit fighting.)

Don, I really believe I understand the concepts of supply and demand and the graphs that can be used to represent the concepts.  At the risk of having to label myself a soothsayer and fool, I think I could even determine the probability of obtaining a particular price, if given appropriate data to make the regressions and obtain the supply and demand equations.  I can do all that using the definition of "supply" as I defined it above.  I simply don't understand what you seem to think is wrong with my definition of "supply".  
You are not a fool. You are highly intelligent and every single one of your posts that I have seen makes good sense. However, you are still seriously misusing the term "supply."
Essentially, you have made up your own definition and decided that it is as good as the one economists have come up with. That may well be the case.

But for precision in thought we must use precisely defined terms. Pretty please with sugar on top, go to Barnes & Nobles or your favorite nearby bookstore, get a stack of econ books and spend an hour looking at them.

I do believe there actually is an "Economics for Dummies" book. I've looked at a lot of the "Dummies" books, such as the ones on gardening and sailing and digital photography and they are all good. (Better than the "Idiots" series, in my opinion.) Start there.

There is no substitute for education when it comes to rigorous critical thinking.

Oh, and just for fun, compare any ten of the econ books. The words may vary slightly, but the concepts are EXACTLY the same in all the books. One of the few nice things I can say about the discipline of economics is that it has well-defined terms. By way of contrast, sociology is a horrible ugly mess, with three terms that mean the same thing and a single important concept used four different ways by four different major sociologists.

Hey Don!  I am bored with precision of words in a subject wherein there is such a great huge hole in its jusifications against the stuff I have been trying to do for decades and generations. (and I am way too far away from you for you to put a hole in me with your mauser for being uppity)  So I boldly go where everybody should.  And that is this.

What's with all this logical precision, math, graphs, tables and so on when econ routinely discounts the future and ignores the full real costs of almost everything?

How the hell can anybody get a right answer with precise logic from false initial premises?

Or is econ just another math game like, for example, game theory, a mere tautology, having no pretense of application to where I live?

I have asked this question of the local econ profs and they tell me to shut up and go fool around with my machines.

You are confusing morally right or global optimiziation right with a correct answer within premises limiting the problem to a much smaller one. I think these limitations ultimately depends on what people care about in their day to day business.

Economical theories are tools that can work both for good and dumb questions. The tools themselves can be perfectly ok even if their use end up ruining people, you must allways ask the right questions. So yes it is math, like game theory, usefull math.

Math I myself unfortunately know too little about. I use to fall back to its ok if money in > money out within a reasonable time period and work myself up from that with a economy textbook. Wich values do I include in the money figures? I guess you basically want much more to be included.

I will try to be more careful in my language. I have used "supply" and "production" as synonyms. I have also used "demand" and "consumption" as synonyms.

However, I'm sure that you know that many of the sources I read or quote (outside TOD) do exactly the same thing. Thanks for the heads up.

best, Dave

I think the economists' model in which there is a demand curve and a supply curve are an extremely rough model of reality. They ignore hysteresis. If price moves very much, then when it goes back neither supply nor demand may go back to the same place it was before. They are approximations that work best for slow changes in elastic goods...
All of undergraduate economics is thinking exercises and no more than that. Then you get to Master's degree grad school and learn that the stuff you learned as an undergrad level was not exactly right. Then you get to the highest level seminars and learn that the stuff you recently mastered also is not quite right. After you get your degree and become one of the annointed, then you can confess that it is like peeling an onion.

My advice is always to go to original sources. You are so much better off struggling with Adam Smith or John Maynard Keynes or Milton Friedman than going through the textbooks.

There are a few outstanding exceptions to this rule. Philip Frank's Intermediate Micro is one example of a recent outstanding texbook, but it is too hard for most beginners.

And, if truth be told, most profs who teach Principles of Economics hate the course and don't do much with it because they want to be dealing with graduate students, the galley slaves who ply the oars on the prof's way to publications.

IMHO our university system is broken and cannot be fixed. (At least insofar as undergraduate education is concerned, students can get anything they want--except an education.)

The head of the International Energy Agency said Tuesday that its member governments could coordinate a release of strategic oil reserves that would offset any shutdown of Iranian crude output for up to 18 months.

"We have 4 billion barrels in strategic stocks," Claude Mandil told Dow Jones Newswires. Even taking account lower estimates, he said, the IEA could keep oil supplies flowing for a year and a half.

The IEA, the Paris-based energy watchdog, has reported falling demand because of high costs of crude.

*** Does anyone has any comment it?

My only comment is that a shutdown of Iranian crude, and only Iranian crude, is an unlikely event.  If Iranian crude is shut down by economic sanction, then the Iranians will do their damnest to shut down all crude being exported through the Persian Gulf.  The IEA should comment on how long they would be able to offset a shutdown of all Persian Gulf crude.  

...And maybe throw in the Venezuelan crude at the same time.

I do not quite agree. Unless there is a military intervention in Iran (highly unlikely IMO) I don't see them ruining their relationships with the whole ME (and the whole world actually) forever. They will not win anything from that and can actually push USA for military actions which everybody else will support immediately. From the mortyr of the day Iran would turn into the criminal of the day.

I am a little bit puzzled by the 4 bln.barrels figure. USA has the largest oil reserve in the world (700 mln.barrels). Is he talking about the total reserves worlwide? Because I don't see all of them readily available to compensate Iranian shut-off.

Personally, I've all but given up trying to guess how this mess will play out, but I will mention one interesting detail I spotted recently.  One of the major US news magazines (Time or Newsweek, likely), ran an article on the Iran situation that included a map showing the range of various Iranian missiles.  The largest one (Shahab-5?) can reach Iceland(!), and I believe that all of them could easily cover the entire Middle East.

If any of us needed "proof" that even the Bushies aren't stupid enough to attack Iran, this should be it.  The US has over 100,000 troops in Iraq, all of whom would be sitting ducks for missile attacks.  

Don't worry.  They're not accurate.
How about we list all the defined strategic crude oil reserve sites in the world that we know about, the capacity and the present volumes held.

                      Capactiy      Current Volume
United States, SPR, 780 MM BBLS,         ? MM BBLS
Saudi Arabia,  N/A,           0,         0 MM BBLS

Saudi Arabia might have a few barrels stashed.   Matthew Simmons thinks the Saudis mask their capacity contraints with huge systems of tank farms.

Q: How large are the Saudi tank farms in country and internationally, like the ones in the Caribbean?

A: Somewhere between 50 and 70 million barrels of domestic tank farms and they have about 10-15 million barrels of Atlantic basin tanks farms that is broken out between some storage they rent in Rotterdam but the majority is in the Caribbean. The only times there is clear evidence of a Saudi surge was during the Iraq war where it jumped by about 800,000 barrels a day for about 45 days. I bet you they were just emptying the tank farms.

No doubt Saudi Arabia should have quite a few BBLs of storage capacity, as would all prudent major suppliers and users, however most of that storage will not be classified as "strategic", as their capacities would (typically) be set approximately equal to the volumes required only to buffer shippments in and out of specific regions in the supply chain.  Those variations would typically be due to production variations, pipeline flowrate variations, tankers arriving sooner or later than the normal transit times and variations in the consumer demands in each corresponding area, as opposed to strategic reserves that are set aside for use only during a specifically declared national emergency, as is the US SPR system.

Saudi Arabia has so many "non-strategic" tanks, that I never had time to add them all up (maybe I'll try to quantify that if someone thinks its interesting), but I do know they do not store any crude oil in their dedicated national strategic reserves, as does the US SPR.  Their domestic refinery capacity is extremely limited and would be unable to refine products to meet any significant strategic demand over their normal base production capacity.  Their strategic storage is limited to 3 basic refined fuels gasoline, diesel and jet base, stored in underground tanks, and minor quantities of pallet stored lubrication oils.  This is why I listed them as 0 MMBBLs.  As such, and since their production and the bulk of their in-country storage is located in the east and their cross-country pipeline capacity is extremely limited, both local and international crude supply is considerably vulnurable during times of crisis.  Hopefully they have significant quantities stored in other locations, but utilizing that as "strategic reserves" would be risky and a very costly service to provide their customers.  It would also be of little use to them locally, so I suspect they try to limit that to the absolute minimum and would be surprized if any should be considered as "strategic" reserves.

Another form of "storage" appears to be developing. Maybe this is where some of the missing crude goes off to hide. http://news.bbc.co.uk/2/hi/science/nature/4712876.stm The dramatic increase in the number of ship-to-ship oil transfers was of particular concern, said Simon Walmsley, head of WWF-UK Marine. "From a layman's point of view it looks very dangerous, and from an expert's point of view it still looks fairly dangerous." "What we need is a full and proper risk assessment of how ship-to-ship transfers work, then we can understand how to deal with it and monitor it better. "The last assessment was carried out in 1997, and things have changed vastly since then." Dr Walmsley said vessels used to transfer oil in this way for logistical reasons: "Ships did this in order to lighten their load, enabling them to enter shallow ports and harbours. "Now they are doing it because it is big business because the Balkan oil fields have really opened up to the global markets."
I'm betting that figure corresponds to the total of all reserves.  Anyone have any numbers to verify?  If so, can you imagine how vulnerable we would be with all reserves pulled down to zero?  One of the main purposes of those reserves is for military use.  There's no way in hell any country would allow 100% of their reserves to be used.  So even if we knew the true number of reserves, you'd have to put a reasonable percentage limit on what would be pulled out.  I'd cut it in half for sure.
The US has  1.7 billion barrels of oil stocks, just under 700 MB in SPR and just over 1 GB in commercial stocks. Western Europe has just over 1.1 billion barrels of oil stocks and Japan has almost 200 million barrels of oil stocks. These totals include refined products. These 3 areas give about 3 billion barrels of oil and oil product stocks (according to latest OPEC monthly report).
Manipulee, Manipula

We spend our time pouring over trends, prices, reserves, gold prices et al, employing MathLab, Fibonacci numbers and other sophisticated tools, and expousing wisdom to each other about the future. We kind of think we are getting a handle on it.

On this Valentine's day however - let's spare a thought for those poor hapless souls living in a basement somewhere, whose job it is to manipulate this economy from day to day. Think about having to wake up, and decide (a) how much SPR oil to dump on the market today (or not), (b) which soundbyte to let CNN have to explain the overnight fall in the gold price(which you engineered yesterday afternoon), (c) talk to Mr Snow's speachwriter about a "strong dollar statement" somewhere, release REPO money to the preferred banks with which to buy assets today,  and so on and so on. And to do this day after day, week after week. Talk about a burden.

So to those of you think it is hard to understand this mess we found ourselves in, imagine how hard it is having to invent it! To those that toil to guide the invisible hand of the market, I say thank you.

Kunstler has an article in the Daily Reckoning:


Yes, this was quite interesting.  I don't believe a JHK column has been posted there before.  Also today, the "Whiskey & Gunpowder" site associated with TDR had a mailbag-type issue on peak oil.  And then, of course, StratFor had the post in their Morning Intelligence Brief about Turkmenistan deciding to raise their NG rates "by autumn" with rather interesting consequences for the Ukraine, and by extension, the EU.
Cheaper to give them that.  Its only worth about, what, 1.5 months of the Iraq oil incursion.

Has there been any discussion on the Olduvai Update?  I have been away...


This is my first comment on TOD and I'm slightly nervous about stepping out from under the trees and the shadows, and out into open grassland, and the light. Especially as there are so many big beasts of science moving around outhere. You may have gathered that I'm not a scientist by profession, or an engineer, economist, businessman and I've never worked for an oil company. Though I'd like to try being the spokesman for an oil company for while. It would be an interesting change for me. I'm a writer of fiction and I thought it would be interesting, just for a change, to share some of my thoughts on Peak Oil. Perhaps looking at it from a radically different perspective than we're used to. Who knows what the future may bring. I hope that doesn't sound arrogant, as I'm still trying to find my "voice" on this issue.

While I'm here, were are the women? I get the distinct impression that TOD is almost exclusively male dominated at present. Please correct me if I'm wrong. Is this healthy? Aren't women half the world? Don't women really need to hear about all this? After all they traditionally nuture our children, organize our families, and generally, historically, destroy far less than men.

Also, what happens to culture and the arts post peak? All those wonderful, evocative songs by Brian Wilson and Bruce Spingsteen and others. Songs about cars and girls. Do they all go the same way as old folk songs about fishing for herring and threshing? Will anyone even want to hear or sing them? Will Bruce and Brian's song be frowned opon and forebidden? Maybe the old songs from our pre-industrial past will return in our post-industrial future?

I think one can get "lost" at times in the forest of numbers, charts, modelling, and all the rest of it. It can at first appear almost overwhelming to most people I'm sure. Peak Oil is almost like going back to school - a school that only teaches math! Not that I don't have respect for scientific discipline and methodolgy. My respect is actually growing especially after TOD. I just think scientist need to become far more social active. I mean they have the knowledge and people have to be told. We should all emulate Hubbert in this respect. There's no point have a career if we don't have a society.

My idea for this thread was inspired by the recent post dealing with the problem of how one contacts and attempts to start a dialogue with "ordinary people" about Peak Oil and it's consequences. I have an idea that may be of some help/relevance, give us clues, or remind us of things we've foregotten as we've all become emmersed in this  this amazing and let's face it, frightening subject. If we think about how we first become aware and got involved, maybe there are useful lessons to be learned about how to approach others and spread the word? Perhaps I'm barking up the wrong oil rig, but who knows? I should add that once I start writing I don't know when to stop. It's a drawback from writing way too much, sorry. Anyway, my idea is as follows; How did each one of us, as indviduals come get involved in Peak Oil in the first place? How did we react to the news? I'll briefly summerise my entry into this area, if I may, to start the ball rolling?

About a year and a half ago I was doing some research for a politial thriller I was plannning to write dealing with the massive corruption and murky politics surrounding the sale of arms to Saudia Arabia. I thought it would be a challenge for me and interesting for readers to learn something about Saudi Arabia at the same time as ripping yarn unfolded. There was so much incredible material. The book was righting itself. My writing desk was covered with books and notes. Suddenly I heard a Suadi Prince on the radio, he was complaining about Americans criticizing his country for the not producing enough oil to satisfy American demand. He said it wasn't their fault. The problem was not in Saudi, but in the United States. Refinery capacity was simply too low. There was a bottle-neck and the true source of the problem. Saudi could produce all the oil the Americans wanted, for as long as the American could pay for it. I thought this was interesting. It almost seemed like a paradox. I was confused. Was it true? Why hadn't the Amrican built more refinery capacity? I started to think a lot about this and put my pen down. A few days later, whilst making dinner I was listening to a BBC radio broadcast about the problems facing small, specialized companies in globalised economy, there was a short interview with a company based in Canterbury in Southern England. This small company dealt exclusively with the oil industry, finding and providing oil companies with whatever they needed, be it men or materials and as quickly as possible, anywhere in the world. For some reason the interviewee started talking about American refinery capacity! Basically he said that the American oil companies hadn't built any new refineries because they knew there wasn't the extra oil available to make it worth their while, especially from Saudi Arabia. One doesn't build a refinary to refine air, I think he said. The journalist doing the interview didn't seem very interested in this startling statement, but it really interested me! This small British company was apparantly agreeing and contradicting the Suadi prince at the same time. Couldn't this mean that Saudi reserves were smaller than the prince had said? Was it really true that the oil companies knew there was far less oil out there than they said in public? If they knew this why did't the American politicians know too? If they did, infact, know, why hadn't they told the American people? I had so many questions and so few answers. Sorry for the cliche. It was frustrating for me. By now I began to think that the arms story was less interesting than the oil story? Surely the core of my thriller should really be the secret information about the true state of Saudi oil production and reserve levels. This information was priceless and of enormous strategic importance and clearly not only for Saudi Arabia. This information was worth killing for. Suddenly the American invasion of Iraq seemed less like madness and more like piracy. This could be on hell of good story. But needed to learn a lot more about oil!

A few days later I stumbled into The Oil Drum and my troubles really started. What I learned on TOD and other sites shocked me, and fascinated me in equal measure. Hubbert's Peak, Die-off, The Long Emergency, and all the rest of it, on and on and on. It's all pretty mind-boggling. The potential consequences for our civilization kind of knocked me of track for weeks. I could think of nothing else, and I was reading everything availble about the subject, in book form and on the net. I used to think that I had an almost infinite capacity to absorb and understand massive ammounts information when I was interested in a subject. I didn't know what being tired was. As a child I was able to reading two books at the same time, while looking up at the television and listening to the radio. After all, I reasoned, life is short and there is so much to learn and understand. Who needs to sleep? I could sleep when I was dead. But, even I started to reach overload after a few weeks reading about Peak Oil for fourteen hours a day. It was all too much.

I felt like I had fallen through a hole in the fabric of reality and entered a parallel universe. There was just so much to think about. I mean this story was absolutely enormous, almost nothing compares to it in my opinion. Only two other stories seemed of greater or equal significance. The second coming of Jesus Christ or an alien spaceship landing on the Whitehouse lawn! (I've since added a third story. That we may have damaged the Earth's climate beyond repair with resulting catastrophic consequences, but that story will have wait.) But how could such a massive story remain so relatively unknown? Were all the journalists asleep? It was baffling. Why wasn't the mainsteam media full of this stuff? Unfortunately, it appears the mainstream media isn't there to "inform". It's there to "entertain" and ultimately to "control" us. It's the circus in the centre of Rome and we're about to run out of bread.

That's more or less how I came to learn about Peak Oil. I realize it's not the route most of the rest of you took, but it's perhaps illuminating all the same. Do we really need a rockstar to start talking about Peak Oil? Do we need Bono to get involved? I don't see it happening anytime soon, because there not enough charity involved.

Finally, I'd like to say how grateful I am to the getlemen who provide and maintain the core of this site. You are doing a first-class job of informing the rest of us about this fascinating and terrible subject. Also there are so many other really intelligent, smart, and creative people who contribute to TOD, at times one feels almost honoured to read their stuff. It's inspiring and also a little sad that our spicies is capable of so much intelligence and so much stupidity at the same time. It would be such a tragic waste to see our civilization fall apart when it really doesn't have to. Sometimes TOD is almost like being part of a "group-mind" or "braintrust", where concepts, ideas and information are knocked around and examined from many perspectives and new connections are made all the time. There is always somebody who knows something about a subject and adds something useful to the debate and standards are very high. I really feel at home on TOD. Though after this who knows? Maybe I'll go back into the shadows again pulling my tail behind me.  

To finish I'll touch on a subject that relates to everything else and especially the question of "What is to be done?" as Lenin once said. Recently we've been moving more and more in the direction of politics, or is that just my impression? This is an inevitable development, because the political consequences of PO are staggering. I know many people are turned-off by politics, but what's the alternative? We can't ingnore politics, like we can't ignore the social and economic consequences of PO, right? My problem is, that of the time scale involved in political change in a country like the U.S. I don't live in the United States, but I love American culture and Americans and have followed the American political scene since I was a child. The kind of change we're talking about doesn't happen overnight. It seems to take a frustratingly long time. But given the size of the problem of Peak Oil and the speed with which it appears to be coming at us, do we have time for plodding "Reform". Don't we need something more dynamic and quicker. I think I may be talking about the need for a kind of "Revolution". I think we need a kind of "revolution" in the organization of our political system. Personally, I would like to see society radically transformed, with a far, far, more democracy in all levels of society. With "power", also economic power, far more equally distributed than at present. I don't want to call it "socialism", but rather "citizens democracy" based on a huge redistribution of wealth. But what are the realistic chances of such radical change happening on a relevant timescale in relation to Peak Oil? Unfortunately, I think we're actually moving in the wrong direction and at some speed. The signs are not good. Iraq is just the beginning. Is Iran next on the list? And what about China? Will the United States really accept the rise of China to rival superpower status without war? Britain, after all spent a century fighting first France and then Germany. I really don't want to sound unduly pessimistic, because I'm not a pessimistic person. Temprementally, I'm an optimist, otherwise I wouldn't bother to be here boring you all like this. I just have lots of pessimistic thoughts. I really wish I thought we were going to get through the transistion period in reasonable shape, but I have my doubts. If we look to history as some sort of guide. After all, we have a lot more information about the past than about the future, the lessons are bleak, and I'm sorry to say this. Intelligent, creative, brave, and highly educated people, some of them actually even had a lot of power, far more than the average TOD member, knew what reforms were required in France, Russia, and imperial Rome and Spain. Unfortunately, they did not succeed in successfully reforming society before it was too late and meltdown/decline/revolution happened. So knowing the truth and being right, often is just not enough to avert disaster. I only mention this in order to indicate the scale of the political challanges we face. We need to substantially re-organize our political culture and then take on the task of changing society and our economic system. Unfortunately, History is often a bitch.

Great post!! Hey, I do writing too, both fiction and nonfiction. My only success in terms of money so far has been an introduction to economics textbook at the college level, and I do not dare give the title, because that would expose my identity . . . . and "wouldn't be prudent."

As you may have noticed in my numerous posts, I am on your wavelength.

BTW, if you are happy with your agent, please give me her name. Currently am trying to market a series of hard science fiction for young adults, and . . . . both categories are dead.

Have some nonfiction, potentially big bucks but not as interesting to me right now as writing fiction.

You can get more truth across in good fiction than any other way. At least, that is my belief.

Anyway, you are no longer a virgin. Keep posting.

I don't really get the "not prudent" thing. It's not like you wrote anything embarrassing, is it? What would it matter if your real identity were known? Something to do with certain people that know you in one context finding out a lot about what you really think regarding certain issues?

Just curious. It didn't take me long to blow my identity but I figure it doesn't matter to me or anyone else.

Assume worst case scenario, Defcon5. Would I really want anybody knowing who I am and where I live and that I might have a year's supply of food stockpiled?????
Defcon 5 is good...defcon 1 is bad, isn't it?  :)
You are right. I meant Defcon 5.
(BTW, this slip of mine shows the dangers of using shorthand or abbreviations--better I should have said TEOTWAWKI;-)
Sigmund Freud rules: For the second time I "accidentally" reversed the numbers "1" and "5." The reason is painfully obvious. I do not most seriously do not want to believe that lethal feces are going to hit the turbines and that I'm going to be looking at two-legged varmints through the scope on my Mauser.
See, I never would have guessed that!

There are two cases: people that know you locally, and random strangers who would look you up on the internet. But in the worst case scenario (I don't know from Defcon 1 or 5) probably there won't be much looking up on the internet.

As for people who know you, well, it strikes me that word will get out about the food whether it's mentioned as a footnote on some old web site or not. Just the fact that you and your family are walking around all chippper while everyone else is kind of lying there passively with their eyes glazing over will be a tip-off. Or one of your kids will tell their friend as a "secret" and then the whole town will know.

Anyway... you're joking, right?????

Plus which, I assume you also stockpiled glocks. (Or Mausers, or whatever.)

Almost, you tempt me to come out of my fortress and admit who I am. But are you ready for the fact that I am Green Lantern? Or Sky King? Or Indiana Jones? Or Farnham of Heinlein's "Farnum's Freehold."?

Of course I am paranoid. That is not the issue. The question is, am I paranoid enough?


This site is rather tech-oriented, but there are many other peak oil sites, where the discussion of things like how to save culture (and whether it should be saved) occurs regularly.  

And don't assume everyone here is male.  How can you tell from screen names?  I am female, and I would guess half the posters at PeakOil.com are female.  Dunno about here, but I bet we are not the only women.

Hey I'm female too - but I'm also a physicist and have spent a lot of my time in mostly male environments of which TOD may be one! :-)
I'm an engineer.  Went to a science/techie college which was extremely male-dominated (to the point where the finding women's restrooms on campus was often a challenge).  My field is still 95% male.  

But I'm not sure this site is a male environment (though it may be).  I'm often surprised at how many women there are in various online fora, lurking behind male or gender-neutral screen names.  I think a lot of them intentionally disguise their gender.  (To get more respect?  To avoid being hit on?)  A computer-oriented site I hang out at had a "silly pickup lines" contest today, and I was surprised to find that a lot of people I thought were male were actually female.    

When do we start PO personals?

Male Doomer ISO Female Doomer
for discreet relationship after TSHTF.
Must have own food, water & ammo.
Edible pets OK.
No skinnies.

ROFL!  Especially at the "no skinnies" part.  

I was just reading an article about how people are giving up on online dating...except for baby-boomers.  Older folk are starting to take over online dating, partly because older people care less about looks.  Did you know there's an online dating site just for science nerds?  SciConnect.com.  So why not a peak oil dating site?  Nobody wants to be alone when TSHTF.  ;-)

ohhhhhh my...
Of course any serious PO type would only date someone within bicycle range. ;-)
Speak for yourself!

I have fast car, will travel.

But is it fast enough so we can fly away ...
Everybody here seems to like speaking for themselves and most do a pretty good job of it, so speaking only on my own behalf, thanks for the post.  I'm an engineer, but I know we don't have any solution for this either (surely not by ourselves), so don't let anyone intimidate you.    

I'm in the pipeline business 31 years now (Saudi 10 years), so I had some idea that the peak oil problem existed for quite some time now.  I found this site through happenstance, through a link offering further comment on the Iranian Oil Bourse that is supposed to be opening Monday next week.  I have some interest in the foreign exchange market and was wondering if there was any opinions about the effect on the USD that oil trading in Euros might have.  While looking through the numerous posts, I found the discussions and various subthreads intriguing and it started me thinking about how PO would most likely affect my personal life which for some reason never really concerned be before.  I saw it as a longer downstream problem.  The price events of the last year and these discussions here have convinced me that there is at least a 50-50 chance that my life could be directly and significantly affected within the next 5 years in some manner, so I wanted to find out exactly how I might be affected and what I should be doing about it now, if anything.  As a result I am considering entering a new area of engineering and use my last few years of personal research into alternate energy technologies to see if I can make this new project socially, culturally and environmentally sustaining in as many ways as I can possibly  manage.  

I also think there are a number of things you may be well suited to do.  There seem to be pleanty of peak oil books floating around.  You know, those ones with the graphs, tables, projections ... all the things the lemmings don't like.  Hence, they're never gonna' get the idea reading those and us engineer types are never going to muster the votes ourselves.  I'd say, if you can find a way to produce a best-seller on this topic during the coming year, you'll never have a better chance to sell it.  Personally, I'd tend to continue with what you have already.. linked to the Pipsqueek, Tony, the Tornado deal, Halliburton and then you simply must work in

Read your post a couple of more times and like it even better. BTW, I once had a Saudi prince as a student. Dumber than spit . . . and arrogant.

In regard to the gender issue, Plato proved (rigorously) about 2,400 years ago that it does not matter. He was right. Specific example: Before you were born (or 1971, if you demand precision) I was tennis coach at a small community college that had never had much of a tennis team. However, I noticed something: The best player we had was a woman named Karen, and because there was nothing in the rules against it, I put her on the men's team. Oh, how the other coaches hated me and refused to speak to me! Karen, who is about 5'2" tall and maybe 115 pounds could beat almost any guy in the whole state. Never before (or since) did our college do so well. (BTW, she married another tennis player, and their daughter is became a tennis champ.)

Some things matter.

Some things don't.

Unless it is a matter of nursing babies (at which I confess my helplessness) gender matters squat.
P.S. Because of what I did, the men coaches got together and made a new rule: Women are no longer allowed to play on men's teams. Oy.

Two comments:

First, not all of the editors of TOD are male.

Second, it's not the songs from the pre-industrial past that will come back, it'll be the songs from the 60s, 70s and 80s that presaged the end of oil. This was discussed way back when on TOD in this thread (there actually are comments there even though it says "no oil here either"). Check out the peak oil soundtrack!

saw that one coming a MILE away.  :)
About half of the Eagles songs are appropriate for these times.  The best, of course is Song for a Dying Planet

Is anyone out there?
Does anybody listen or care anymore?
We are living on a dying planet,
We're killing everything that's alive,
And anyone who tries to deny it
Wears a tie
And gets paid to lie
So I wrote these songs for a dying planet,
I'm sorry but I'm telling the truth,
And for everybody trying to save it
These songs are for you, too.
Is anyone out there?

Then of course, there is The Last Resort

Some rich men came and raped the land,
Nobody caught 'em
Put up a bunch of ugly boxes, and Jesus,
people bought 'em
And they called it paradise
The place to be
They watched the hazy sun, sinking in the sea

Not cited in that thread, but wonderful, is "We Can Run But We Can't Hide" (Grateful Dead, Barlow/Mydland):

We don't own this place, though we act as if we did,
It's a loan from the children of our children's kids.
The actual owners haven't even been born yet.
Well, it's oil for the rich and babies for the poor,
We got everyone believin' that more is more,
If a reckoning comes, maybe we will know what to do then.

And from the chorus:

We can run,
But we can't hide from it.
Of all possible worlds,
We only got one:
We gotta ride on it.
Music post Peak

One of the features that has kept New Orleans unique is that we have never been car-centric.  Radio play is usually on a radio at home while doing a chore, or just turn off the TV and listen, or with a meal. WWOZ is often the choice, a local nonprofit that features local music.

Much of popular music is orientated towards the theatre of the automobile/SUV but that doesn't play well here.

But live music is also VERY common.  The Mardi Gras Indians often practice in local bars, I live close to a combo bar, grill, laundromat with live music (a MAJOR advance in civilization !).  Monday nights at Donna's is one of my habits (last Monday, 11 guest musicans got on stage).

So I think that music will move beyond the theatre of the SUV (where it has to overcome background noise and drivers distraction), and become more organic, less amplified, more rythmic and probably more diverse.  Perhaps the mass culture fixation on "What is Hot" will fade and an appreciation of what is good will grow.

AlanfromBigEasy, I just ran across this link that you may find usefull in your redevelopment work. I admire your efforts. It can't be easy. There's only 4 US cities that I ever really liked. You're in one of them. Hope it helps. http://www.lgean.org/html/toolbox.cfm

Welcome to TOD.

  1. TOD is perhaps one of the best sites on the net for factual discussions on Peak Oil - discussions grounded in science (THANK YOU STUART)!  

  2. You WILL (like all of us) go through the 5 (or is it 7?) psychcological stages of facing a crisis - Disbelief, Anger et cetera before reaching Acceptance.  Homer did it in about 10 seconds on a Simpsons episode once - funny stuff : )

  3. Peak Oil is a theory.  A theory that will very soon be proven on global scale.  Peak Oil as a concept or motive for change, however, doesn't work.  It doesn't address the lowest common denominator.  Example: using Homer again, if you were to tell Homer that the gas tank in his car has 'peaked' and that he will have to mitigate a decline in remaing hydrocarbon capacity, he'll look at you without blinking.  Meanwhile the animation team will have drawn a bubble above his head; in it, a dead donkey in the desert buzzing with flies.  On the other hand, if you were to tell Homer that he is running out of oil, he would shout 'D'oh'!

(Prof Goose the resident sociologist - perhaps he could comment on this as I also beleive that if we weren't calling the dire phenomenon Global Warming -warming of course being a warm fuzzy term that likely conjures happy thoughts because hey, who really wouldn't like to be warmer- the world could perhaps be just that much further down the road to actually DOING SOMETHING ABOUT IT.)

4)  Don't worry.  Worry is a completely useless human emotive - especially as it relates to Peak Oil.  Why?  Because for North America, Peak Oil is a liquid-fuels crisis that can be mitigated by conservation and alternatives.  

With one caveat.  The government has to be willing to lead the people, create the initiative and provide the challenge.  The citizenry in turn, will have to take up that challenge through hard work, determination and sacrifice.  

5) Take the first step.  Reduce your energy dependence or energy 'foot print' if you prefer as much as possible.

  1.  As I've said a few times of late...we really wanted this to be a reality-based community.  Thank you for saying that.

  2.  it's 5.  (type "Kubler-Ross" into the TOD search box, it comes up a few times.)

  3.  Don't even get me started on how we as those sympathetic to green concerns framed the issue of "global warming."  Badly done, imho.  "Climate change" gets closer to the concept.  Of course, nothing says it as well as "fucked."

3b.  It really is all about Homer, isn't it?

  1.  Amen on the govt, but that would require leadership.  I shall not hold my breath, because it seems politicians only respond to crisis or threats to losing their jobs.  I see no sandwich boards on the street.

  2.  Amen again.
writerman - you may be interested to know that one of the peak oil awareness raising efforts of UK group Powerswitch was a peak oil short story competition.

An "arts" based approach can be a very good way of reaching people with less of a technical orientation.

History is a bitch...but free will is an even bigger one, eh?

Writerman, there's so much in this comment to grab onto.  First off, thank you for your thoughts.  I hope you will step out of the shadows more often and use that voice have found.  

You're right, this is a braintrust.  The refined insight that passes through here on a daily basis humbles me.  If you need an answer, someone here will have it, or they'll find it.  That was one of the goals when we started, and I will do everything I can to make sure it stays that way.  

I am not sure about the gender base of our community...I would love to have that data though.  I would like to think we are being inclusive...back in the early days there seemed to be more women around that there are now.  Yankee, didn't you talk about this at some point?

I think the point I would like to grab onto the most in your comment is the last.  The politics of the peak fascinate me.  I have thought about the many ways it could go down, and I keep coming back to a thread that's run through a few places here at TOD: the completion of the continuing destruction of the middle class in the US.

The US does not have a social democracy, we have a liberal democracy with institutions (two party/presidential system) that are set up to not be at all reactive but slow to change and deliberative.  

If we lived in a parliamentary democracy, if the rules of the game were different, a new election could have been called countless numbers of times over the past few years and a change of leadership would have resulted.  

In better words, those same institutions that have maintained the stability of the United States over the times of plenty are exactly the institutions that will keep us from reacting, as a country, in time to avoid catastrophe.  At least that's my feel for it.

You're exactly right.  We need to reorganize our political culture...but in order to do that, we would need a new Constitution...and that would require a public outcry or political instability heretofore unseen in the US.

As I said somewhere else today, I didn't see anyone outside with a sandwich board today clamoring for change...so obviously, our job is not done.  (I know many of you do not "like" politics...but this is an inherently political topic that is so far above the issue space our politics actually takes place in that it continues to amaze.)

here's a wiki on why we have a two party system...

"# Uncommon, unconventional ideas and ideologies remain non-influential, so policies and governments do not change rapidly. (Others dispute whether such innate conservatism provides advantages. While smaller parties find this exceptionally frustrating, proponents of the two-party system suggest that it enhances stability while eventually allowing for ideas that gain favor to become politically influential.)"

here's a wiki on a parliamentary system...

In my courses, I often describe the parliamentary system as an ideological speedboat, it can react, zigging and zagging back and forth quickly, but it can also flip over and kill you.

I describe the two party/first past the post system as a very very large cruise ship.  It is stable.

However, I think we also all have heard of the event/seen the movie where the crewman saw the iceberg, threw the wheel hard over, and the ship didn't turn in time.

and all of that is tied with my field's only "law" (and it ain't really a law): Duverger's Law.  http://en.wikipedia.org/wiki/Duverger%27s_law
Are you trying to tell us that you are a political scientist? (Gasp!) And all along I've thought you were so smart you had to be at least a sociologist and maybe an economist.

Could my stereotype possilby have an element of exaggeration or error in it?

No, no, does not bear thinking about.

Query: Is there one single Ph.D. psychologist on TOD?
Is there one single Ph.D. historian on TOD?
Is there one single Ph.D. philosopher on TOD?

Perhaps we should try hard to reach out and get more ideas from more disciplines.

I am a Ph.D. historian, Don. Trained as a medievalist, actually. Hence my guest post on the Black Death. And hence my fascination with PO. I know that civilizations can decline, and I know what the Dark Ages were like. And as I was never into the whole Dungeons & Dragons, Society for Creative Anachronism thing, I don't really look forward to a new Dark Age.
Yeah, the Dark Ages sucked bigtime. How to prevent their return, that is the $64 question . . . . One of the most interesting science fiction novels of the many thougsands I have read is LEST DARKNESS FALL by L. Sprague de Camp. It is based on the premise that a guy from 1940 goes back to the time of Justinian and single-handedly works to prevent decline into the dark ages. The book is written with wit and solid research by an engineer who knew much about people and socieities and the difference between theories and getting something that actually works.

Highly recommended. Oh, BTW, also read everything else de Camp published, especially THE ANCIENT ENGINEERS. Fascinating.

I don't have a PhD in anything as I'm an academic jack-of-all-trades and master of none you might say, but, for what it's worth, I have taken more psychology courses than some psychologists. These days electricity systems are my bread and butter, and I read mostly economics, finance and energy studies. Naturally I approve of your call for an interdisciplinary approach.
I love eclecticism. Personal note as to how I got to be able to beat anybody at Trivial Pursuit: Got my MBA in finance in Jan. 1965, just when the Vietnam War is heating up, and I am 1Y which means deferred from draft so long as I am full-time student--reverts to 1A automatically. I go to my advisor for a letter of recommendation, and he says to me: "Don, did you ever think about getting a Ph.D"
"Well, think about it."

So home I go up the steep Berkeley hill on my old three-speed Raleigh and it is obvious: I can go to 'Nam and get my posterior shot off, or I can stay in school until the war is over or I get beyond draft age. The only trick is that I must never get a terminal degree, because then it is all over, and they will put me on a plane to get my very well-educated head shot off by some guy in a tree. So every time I get close to getting a degree I change majors. The administration never did catch on, and I lost count of my post-Master's credits once they reached 300. Finally I became too old to be drafted, and went out with a blaze of glory by telling my Econ profs exactly what I thought (instead of what they wanted to hear), so of course they had to flunk me on my orals. Oh what fun it was to tell them that their applications of math were all wrong, that the Phillips Curve was a bogus concept, that their models were fundamentally wrong and worse than useless in some cases, etc. They all thought I'd had a nervous breakdown;-)

LOL! I'm glad I'm far too young (and of the wrong nationality) to have had to worry about being sent to Vietnam. Now I'm too old to be drafted, but my children aren't. I may yet have to encourage my son to become a perpetual student, although not being American is a bonus in that regard.

I spent ten years in university getting four degrees (interdisciplinary, but nominally two in science and two in law) out of sheer fascination with learning and making connections between different fields of study. After all that I reckon I can teach myself a thing or two, and so the learning process continues. I really should be concentrating on practical skills, but TOD and my expanding reading pile are still very tempting.

It strikes me that Peak Oil is exactly the type of knowledge domain (a category of?) men are attracted to, wish to demonstrate accomplishment in, and occaisionally engage in status struggles over.


BTW, to save you a lot of time, I have the highest genetic fitness of anyone in this group.

I felt like I had fallen through a hole in the fabric of reality and entered a parallel universe.

Welcome to "Paradise Lost" writerman.

P.S. The problem lies not in our oils, but in ourselves.
too good sb.  too good.
Initially, 1972, when I read "The Limits to Growth". Hmmm, I thought, hope we get smart in the next 30 years or so and find ways round these potential problems. Back then pollution was a more immediate problem and we mostly solved that. Early faint mutterings about global warming could be heard, population growth was seen as a potential problem, but resource depletion was not even on the radar.

I started to use the net a lot about 5 years ago, checked up on the current state of research on climate change, saw mention of peak oil and followed it up. Been keeping a close eye on it ever since, more so in the last 18 months since it's looking pretty close now.

I think you're right with most of your post. Peak oil and its consequences will be the biggest event in our lifetimes. Our current political and economic systems look ill suited to effective action to mitigate what will probably happen and are likely to be equally poor at solving the problems once they occur. The scale of political, societal and economic change you correctly see as necessary will not happen except as the consequence of massive disruption. If you get your revolution (and the odds favour it) the transition is likely to be very unpleasant.

The political angle is a tough one for me on TOD - I'm very politically aware, and I believe that it will not be the direct consequences of PO that impact us all in a big bad ugly way (getting tired of TSHTF), but rather the other social/political/economic consequences (I almost hesitate to call them secondary effects, they march right in step).  And there are the global warming issues, but these are not consequences of peak oil as much as of the volume of past consumption (a brother of PO!).  The problem is that I'm wary of ugly political arguments destroying the discourse here on TOD, so I hesitate to go there, at least when I maintain my self control.  There is a lot more "noise" on the political sites I look at, and I don't miss that when I visit TOD!

But truly, I saw the social/political/economic effects of PO before I understood the issue of PO in full - and I'm still learning how they interrelate.   I think the US has been damaged to a much greater extent than people realize (or are willing to let themselves see), and I think that things are capable of degrading very quickly indeed given a bit more pressure.  So politics is part and parcel to the PO issue.  HOWEVER - I think this is one issue where the political lines seem to be drawn slightly differently.  I think PO is one of the few areas where I find any common cause whatsoever with conservatives.  I find this an interesting phenomenon, and I'm still mulling it over.  

The stakes have gotten very high already in the geopolitical maneuvering, and the odds of a major screw up are also high.  As alarming as PO is, and as difficult a problem as that is to deal with, I believe other symptoms will force us to focus short term and prevent much in the way of enlightened response.  

Re the $7 billion giveaway:

I'm shocked - shocked I tell you!  And here I thought the big oil companies were models of capitalist free market prowess.  Captains of industry navigating the troubles waters of the market, taking risks, winning and losing as the chips fall.  Now I find there are mere crony capitalists - more pigs feeding at the public trough.  Sigh. Another bubble burst.

Shall we talk about those profits they "earned" again?

Well, that's gotta' be good for something.  Where's my biogas handbook?


The image of Oil Industry execs in a farm is humorous, but we're getting dangerously close to "hydrocarbons from Uranus" again!  Can't go there.
I was just filling in your bitmap.  U started it!
Sorta makes the congressional hearings when they called the major oil execs to task for "excessive profits" jest a might bit suspect, no?