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Peak Oil (was "petroleum geologist explains US war policy")

It's reasonable, but everything depends on how quickly this gap between demand and supply comes and grows, how markets react and how institutional and vested interests react. I'm not feeling very hopeful at the moment, the most likely reaction seems to me, as he says, to be another huge rise in interest rates to cut demand through recession and mass unemployment; this doesn't really do much for restructuring by itself. It isn't making my decision on whether to take up another massive loan for postgrad education much easier.

That's the first one then; if we are at peak, it's, unprecedentedly, the first in a series of downward as opposed to upward biased economic cycles, and where that goes god only knows. As the guy says, we need high, stable oil prices, the first is assured, the second most certainly not.
 
Incidentally this strikes me as a possible major reason that the EU has not backed down on CAP reforms in the form of trade deals with developing countries. Self sufficiency is going to be hugely important if resource scarcity brings a huge rise in protectionist sentiment.

Also Noam Chomsky on this:

July 26, 2004
Peak Oil Theory
Posted by Noam Chomsky at July 26, 2004 10:43 AM
The basic theory is incontrovertible. The only questions have to do with timing and cost. ...

The date can be pushed back much farther if more costly (or maybe some to-be-discovered improved) technology is used. As for the estimates of cost, by reasonable standards one could argue that oil is far under-priced. In real terms, it's not particularly high now as compared with other commodities, from some reasonable base line. And low-priced oil leads to heavier use and less effort to create sustainable alternatives.

That I think is a far more serious problem than production peaking. In fact, one could argue that the earlier production peaks, the better off the human species (and a lot more) is, because of the effects of unconstrained use of hydrocarbons on the environment.

Talk about "shrinking our economies" is pretty meaningless. Our economies would shrink substantially if we got rid of huge expenditures for the military, for incarceration, and other highly destructive activities. Sustainable economies might lead to highly improved quality of life.
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There seems to be a quite persuasive counter-argument that the reason recent discoveries have not been made is the lack of real competition in the oil market (Reagan-era mergers primarily) and that if the market gets given an almighty kick up the ass then surveying etc will take off again. This is an alternative explanation for production peaking, but it's a big if given the circumstances and possibilities.
 
Meanwhile, global food security is becoming enough of an issue that the Indepedent has an article on the subject.
It is the same story worldwide. Population growth and the loss of land have cut the amount of fertile land available to feed each person in half since 1960. And more than half the world's people live in countries where water tables are falling rapidly and wells are running dr
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Bernie Gunther said:
The BBC have an article today exploring the question of whether we should consider giving up on domestic food production altogether and subsist entirely on imports. Is someone promoting that idea?
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As I remember it, the Milk Marketing Board arose from a similar debate in 1944 - turning as much of the country as possible over to dairy was the fragment that got implemented out of a proposal to abandon agriculture. (Or was it 1917?)

Anyways, it's been in the Book of Policy Options for a while. An email to Miriam O'Reilly - "Off the record, who've you been talking to 'off the record'?" - would probably be interesting - firstname.lastname @ bbc.co.uk, probably with the <'> but try both ways.
 
I've got a better idea, instead of property development, let's demolish and convert the sites of all obsolete buildings into Cuban-style organoponicos where the soil is fucked and conventional allotments where it's still good.

Let's create a positive legislative environment for eco-villages, intentional communities, built and run on ecological and egalitarian principles, with equivalent organisations for those working the allotments and organoponicos.

I prefer this to building lots of nuclear and paving over the UK, turning it into a huge combined call centre & US military base. While importing all our food.
 
Mexico find oil reserves

Three years of exploration has enabled Pemex to map oilfields that the state-owned oil monopoly believes will more than double the nation's known crude oil reserves.Luis Ramírez Corzo, Pemex's director for exploration, told EL UNIVERSAL that on a "conservative" estimate, almost 54 billion barrels lie underneath the oilfields. That would take Mexico's reserves to 102 billion barrels, more than the United Arab Emirates (which has reserves of 97.8 billion barrels), Kuwait (94 billion) and Iran (89.7 billion), and almost as much as Iraq (112.5 billion).

The official also said the discovery could enable Pemex to increase Mexico's oil production from the current level of 4 million barrels per day (bpd) to 7 million bpd. Saudi Arabia currently produces 7.5 million bpd, while Russia's oil output is 7.4 million bpd. Ramírez Corzo said the exploration, at an investment of US4.6 billion, led to the identification of seven separate blocks rich in oil and natural gas. The most promising blocks are under water in the Gulf of Mexico, thought to contain around 45 billion barrels.
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Oil back up as report shows US reserves at their lowest since March....

Oil prices rebound on US report

The price of oil rose more than $2 a barrel following an eight-day run of losses, as a US report showed crude oil stocks at their lowest since March.
US light crude went up by $2.13 to $44.25 a barrel, and London Brent crude was $2 higher at $41.61 a barrel. The increase came as the US Energy Information Administration (EIA) said crude stocks dropped 4.2 million barrels last week to 287.1 million. Crude stocks have fallen by 18 million barrels, or 6%, since early July.

Refineries have been operating at more than 95% of capacity to meet summer vacation driving demand. The drop in crude oil stock comes at a time when world supplies are being stretched, with global demand growing at the fastest rate in 24 years. The EIA said world crude production was running at about 99% of capacity, indicating likely future price rises.

"Any industry in which production is running at 99% of capacity to meet demand is likely to experience price pressure. "There is no reason to expect that crude oil markets would not reflect these same fundamental economic forces," the EIA said in its weekly review of the oil market. Demand remains at a 24-year high, led by rising consumption in China and the US.
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Barking_Mad said:
Mexico find oil reserves
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Findings may be exagerated:

http://www.washingtonpost.com/wp-dyn/articles/A47535-2004Aug30.html

Washington Post said:
Richard Nehring, president of NRG Associates in Colorado Springs, said that based on discoveries of oil in U.S. waters in the Gulf of Mexico, Mexico's discovery may be "very significant" but its size has probably been exaggerated.

"The amounts are too large," said Nehring, whose company studies North American oil and gas fields. "They may have exaggerated it for political purposes."

"We've been through this before," said Carlos Heredia, a Mexican political analyst and economist, recalling a similar announcement by President Jose Lopez Portillo in the late 1970s. Lopez Portillo announced a major oil find in Mexican territory and told Mexicans to get ready to "administer the abundance." His promised oil boom never materialized, and his presidency is now remembered best for economic mismanagement and paralysis.
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Ah nice one, I did raise an eyebrow when I read it as it sounded too good to be true, but I couldnt find anything at the time to say otherwise.

Cheers :)
 
NEWS RELEASE

http://www.fromthewilderness.com/free/ww3/082304_million_depletion.shtml


For Immediate Release:
Tuesday, 24 August 2004

The world is now losing more than a million barrels of oil a day to depletion – twice the rate of two years ago – according to a new analysis published this month in Petroleum Review, the oil and gas magazine of the Energy Institute in London.


The analysis shows that output from 18 significant oil-producing countries, accounting for almost 29 percent of total world production, declined by 1.14 million barrels a day (mb/d) in 2003. The annual rate of decline also appears to be accelerating, contrary to the widely held view that depletion progresses slowly.


Based on data in the latest BP Statistical Review of World Energy, production from this group of 18 countries peaked in 1997 at 24.7 mb/d and by 2003 it had fallen to 22.1 mb/d. In 1998 their total production dropped by less than one percent, whereas last year it declined by nearly five percent.


“It appears that depletion is now becoming a much more significant, though largely unrecognised, consideration in the supply-demand equation, and may be contributing to the rise in oil prices,” said Chris Skrebowski, Editor of Petroleum Review and a Board member of The Oil Depletion Analysis Centre (ODAC), who prepared the new analysis.


“With world oil demand surging faster than anyone expected, it is no wonder that current supplies are stretched to the limit,“ he said.


By re-ordering the BP data on a continuum from those producers with the largest declines to those with the largest gains, his analysis shows that in 2003 the producers still able to expand production had to increase their total output by over 7.5 percent to achieve overall world production growth of about 3.7 percent.


“Looked at in this way, you see a quite different and more worrisome picture from the one presented in the BP report,” Mr Skrebowski said.


“Those producers still with expansion potential are having to work harder and harder just to make up for the accelerating losses of the large number that have clearly peaked and are now in continuous decline,” he said.
 
Note to editors:
The full report in Petroleum Review, ‘Depletion now running at over 1 mn b/d’ (August 2004) can be downloaded in PDF from the ODAC website: http://www.odac-info.org

The Oil Depletion Analysis Centre (ODAC) is a UK-registered educational charity working to raise international public awareness and promote better understanding of the world’s oil-depletion problem. Further information is available on its website.

Chris Skrebowski is one of seven members of ODAC’s Board of Directors. He previously edited Petroleum Economist and was an oil market analyst for the Saudis in London for eight years. He started his career in the oil industry as a long-term planner for BP, then joined Petroleum Times as a journalist and edited Offshore Services magazine in the late 1970s.
 
...and the The Mystery of the Missing Carbon:

http://magma.nationalgeographic.com/ngm/0402/feature5/index.html

National Geographic said:
Each year humanity dumps roughly 8 billion metric tons of carbon into the atmosphere, 6.5 billion tons from fossil fuels and 1.5 billion from deforestation. But less than half that total, 3.2 billion tons, remains in the atmosphere to warm the planet. Where is the missing carbon? "It's a really major mystery, if you think about it," says Wofsy, an atmospheric scientist at Harvard University. His research site in the Harvard Forest is apparently not the only place where nature is breathing deep and helping save us from ourselves. Forests, grasslands, and the waters of the oceans must be acting as carbon sinks. They steal back roughly half of the carbon dioxide we emit, slowing its buildup in the atmosphere and delaying the effects on climate.

Who can complain? No one, for now. But the problem is that scientists can't be sure that this blessing will last, or whether, as the globe continues to warm, it might even change to a curse if forests and other ecosystems change from carbon sinks to sources, releasing more carbon into the atmosphere than they absorb. The doubts have sent researchers into forests and rangelands, out to the tundra and to sea, to track down and understand the missing carbon.
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Anyone know when the programme linked by laptop above will be shown again?

BP sees no energy supply problem

BP chief executive Lord Browne has insisted that the global oil industry has the capacity to meet future demand. "There isn't really a supply crunch at the moment," Lord Browne told the Financial Times newspaper. "We have the perception of the risk of a supply interruption, but that's all we've got," he said, adding that oil companies are investing to meet demand. Oil prices continued to firm in Asian trade, amid fears that Hurricane Ivan would disrupt oil supplies.

US light crude gained 24 cents to $44.12 a barrel, while London's Brent crude rose 38 cents to $41.13. "Supply has not been interrupted and can be forthcoming in significant quantities," Lord Browne added. Lord Browne's comments, which contrast with the views of many industry insiders, come at a time when prices are highly sensitive to any development that could reduce supplies. The threat of disruptions in Iraq and Russia drove US crude prices to a 21-year high last month, just short of $50 a barrel, prompting fears that higher energy costs would dent global economic growth.
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Barking_Mad said:
Anyone know when the programme linked by laptop above will be shown again?
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That link is now dead, here's the new one:

http://www.bbc.co.uk/bbcfour/documentaries/storyville/oil.shtml

I caught the first one and will get the other two if I remember... I can convert to Divx and stick 'em on a CD, or should get all three on a DVD-ROM if anyone's interested. PM me an email addy if you are.

TBH, I didn't really rate the program that much - perhaps more on that later... meanwhile, it would appear to be 'pub o'clock'. ;)
 
I´m sure someone will correct me if I´m wrong, but my understanding of all this is that we are now "beyond peak production," apart from Lord Browne and the Mexicans attempting to pour some calming oil on troubled opinions. In other words, the decline in oil production forecast for the 70s is now a reality, with no further exploitable resources. And when prices hit $100 a barrel, several western economies, particularly the US, will go into freefall, with associated social consequences?

Well that explains a lot.
 
The peak oil arguments are well documented. In terms of oil in the ground I think it's a fallacy that we're already past maximum peak production. In terms of where the oil is and what is going on there, we may be in some trouble. It's also the poorest nations that were nailed the most by the last oil price spikes, so that's not altogether clear either.
 
 
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