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

This has been all over the news and net today and yesterday

Branson warns that oil crunch is coming within five years

Sir Richard Branson and fellow leading businessmen will warn ministers this week that the world is running out of oil and faces an oil crunch within five years...

...Chris Skrebowski, an independent oil consultant who prepared parts of the peak oil report for Branson and others, said that only recession is holding back a crisis: "The next major supply constraint, along with spiking oil prices, will not occur until recession-hit demand grows to the point that it removes the current excess oil stocks and the large spare capacity held by Opec. However, once these are removed, possibly as early as 2012-13 and no later than 2014-15, oil prices are likely to spike, imperilling economic growth and causing economic dislocation."
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Here's the full report:

http://peakoiltaskforce.net/wp-content/uploads/2008/10/oil-report-final.pdf

EDIT: Oh, this is exactly the same report they put out 2 years ago :/
 
Dr Jon said:
I just spotted this article, which suggests that there isn't such an acute shortage of oil as people imagine, because prices are also being manipulated by our old friends, the Money-Juggling Parasites:



See:
The Global Oil Scam: 50 Times Bigger than Madoff

:eek:
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The ICE is just another exchange, it competes with the NYMEX. It took over the IPE in London which lists the benchmark Brent contract. The ICE cannot in itself manipulate prices, the Oil market has so much liquidity with hedge funds, producers, consumers, storage companies, transporters, speculators, retail investors etc. all buying or selling. There is an element of HFT which HFT groups trying to gain an advantage by locating their black boxes as close geographically to the ICE servers as they can.

Edited to add, in general, on most commodity exchanges, the actual number of contracts that go to physical delivery (where physical delivery exists) is most often below 3%.

The fact that the ICE is outside US law is irrelevant, (ICE now a listed company based in Atlanta , owns the NYBOT and now has an exchange and clearing mechanism in the U.S. as well as London)the LIFFE, LME and many other major world exchanges are outside of U.S. Jurisdiction.
 
Some professor who is an adviser to OPEC has written a book that suggests the UK should have more government control over the North Sea, in order to maximise the value of the remaining reserves.

http://www.guardian.co.uk/business/2010/mar/07/oil-gas-production-north-sea

In a new book soon to be published, he argues: "UK oil and gas production has been steadily declining since 1999. The reason is that the UK government, unlike those of most other countries, has abandoned oil and gas production to the private sector and has failed to create attractive conditions for private companies to invest more."

He adds: "The government should follow the example of Norway and many other countries by setting up a hydrocarbons authority, which would initiate new private-public partnerships to engage in offshore oil and gas production. This would generate many billions of pounds in highly needed revenues."

Only the US is similar to Britain, he claims, in leaving the exploitation of its natural resources entirely to the private sector, with most countries controlling the business through state agencies or their own national oil corporations.
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Obviously the book isnt out yet but if he thinks we can reverse the North Sea peak then Im likely to disagree quite strongly. Clearly I dont know exactly how much is left, and in general the things he suggests could be useful, but its a bit late to crave after Norways sovereign wealth fund, the horse already bolted.
 
pboi said:
Peak Oil is a long long long way off.

Dont worry.
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How far away do you think a long long long way off is? A week is reputed to be a long time in politics. Years? Decades? More than the lifetime of people alive today? Our children?
 
Recession's put the date back a bit I reckon. There won't be a "crash day" but a judder of drop, small recovery, drop, small recovery.
 
http://news.bbc.co.uk/1/hi/business/8563985.stm

China's demand for oil jumped by an "astonishing" 28% in January compared with the same month a year earlier, the International Energy Agency (IEA) says.

The body added that demand for oil in 2010 would be underpinned by rising demand from emerging markets, with half of all growth coming from Asia.
But the IEA predicted demand in developed countries would fall by 0.3%.
The IEA has increased its global oil demand forecast for 2010 by 1.8% to 86.6 million barrels a day.
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Article also goes on about the current price situation which IEA attributes to geopolitical tensions in some producing countries and that the ample physical oil supplies are moderating the price.

Im not sure quite how astonishing China's demand jump really is, was there an astonishing reduction in demand the year earlier that they are comparing it to?
 
I reckon the Chinese are increasing their stategic reserves, or it's part of a huge bluff about how fucked it's economy really is.
 
the scottish and english offshore windfarm licences already passed have serious capacity, and thats before turbine efficiences are improved and the supegrid is linked up.

and that algae is just one of the avenues to producing oil in the future
 
pboi said:
have you seen the plans for the european supergrid?

or the US DoD planning to use algae to fuel its jets? http://www.guardian.co.uk/environment/2010/feb/13/algae-solve-pentagon-fuel-problem

dont patronise me
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Certainly very promising reesearch. As far as I understand itthe problem at the moment is that the oil produced poisons the algae, but they are working hard on that. Whoever gets the patent out on a working varient is going to be worth a fortune.

On the downside it will reduce the pressure to make energy savings and reduce carbon output. One of the most convincing arguements against climate skeptics is that we need to reduce consumption anyway to preserve fossil fuel stocks.

ETA: More details here - www.sciencedaily.com/releases/2010/03/100312164659.htm
 
I dont think the alternatives will become abundant and cheap enough soon enough to remove the incentives to reduce energy consumption & waste. Even if some of the alternatives scale up to impressive levels, the sheer scale of our present oil exploitation is extremely hard to equal.

Short of a complete miracle in the energy sciences, I cannot imagine the present economy lasting for another 20 years, its fundamental need for growth is incompatible with even the optimistic future energy scenarios. Hard to tell quite how rapid the change will need to be because the decline rate for oil production isnt completely clear yet though there are obviously some worrying steep estimates knocking around.

My expectations remain that a huge part of solving the energy gap will be done on the demand side, and a fair chunk of this will not come through green thinking cleverness and efficiency improvements, but a long series of crises that force people to consume less in most areas of their life.

The future is more local, less is more, let them eat digital cake.
 
but if you stop thinking on a global scale and just worry about the most developed western world, I think its less of an unsurmountable goal.
 
pboi said:
but if you stop thinking on a global scale and just worry about the most developed western world, I think its less of an unsurmountable goal.
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:confused: but the developed world is most vunerable to peak oil as it uses the most energy per capita.
 
yeh I didnt really think that through.

I think I meant, its most likely to change in the developed world, then hopefully over time the developing soon to be developed will follow? the infrastructure/political will and awareness really might push through the change. I own shares in a few wind farm companies and the uk licences pass so far will supply a serious part of our energy needs going forward. if the supergrid comes in...wow, it will be incredible.

I dunno, my brain is fried.
 
I see the US DoE now admit that there is likely to be a decline in world oil production from next year:
The Obama administration supports the alternative hypothesis of an 'undulating plateau.' Lauren Mayne, responsible for liquid fuel prospects at the DoE, explains : 'Once maximum world oil production is reached, that level will be approximately maintained for several years thereafter, creating an undulating plateau. After this plateau period, production will experience a decline.'"
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link

I'm guessing that the global economic "downturn" has stretched the peak out until next year...
 
Oh now that is interesting. Part of a trend in recent years for powers to admit peak oil whilst still denying it at the same time (Browns Saudi oil summit was one of the more blatant examples). The usual theme of blaming lack of investment.

Anyway as the article you link to mentions, the undulating plateau is hardly a completely different hypothesis to peak oil.

Recession has certainly had some effect on the timing of things but probably not too significant overall, and will provide new excuses for why the lack of investment didnt happen when needed.

Ive given up worring about exactly when the peak is, may already have happened depending on whether we are talking about conventional oil or all liquids. How long the plateau lasts, when the decline really sets in & decline rate now interests me far more, along with how the issue is talked about by governments and media, what demand is doing, and the different ways demand can be destroyed.
 
Crispy said:
Recession's put the date back a bit I reckon. There won't be a "crash day" but a judder of drop, small recovery, drop, small recovery.
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That is Greer's assessment in "The Long Descent", and certainly about as optimistic a forecast as the facts appear to be able to support.

On the other hand, complex things have a habit of working until they don't, then not working at all. Think about a 4-stroke engine after the "oil pressure" light comes on - the health of the tappets is irrelevant. There isn't anything more complex than "the economy". Bits of it might be capable of function continuously under conditions of declining energy input (domestic energy consumption, welfare services, industrial and agricultural output, for example) and simply fall in some proportion to the supply of energy.

But most are now dependent on a global supply chain which is only sustainable with cheap fuel and will fail fairly quickly. In the UK we consume more energy and food than we produce, and those are both pretty critical "factors of production" for the rest.

More seriously, all are dependent on a functioning financial system, which as far as I can see can only function under conditions of increasing energy input to maintain the integrity of the "interest repayment" assumption.

We take our health for granted, but we have it because of access to clean, hot water, refrigeration, heating in the winter and complicated industrial processes for manufacturing exotic antibiotics. There is a nasty positive feedback, bistable situation that exists around energy input/general health.

And we are much closer to conditions of social disorder than most people think - friends of mine in the police force tell me that after a couple of nights without street lights they would lose control of the streets. Social conditions now and those in pre-war Britain are totally different. Social stability is a "positive externality" of energy supply - something you get for free and, therefore, don't think about very much.

So I don't see how you maintain conditions if you have no way of feeding people properly, staying healthy, paying wages and maintaining social order.
 
I saw 'Crude Impact' the other night - a film about peak oil. Was ok. An interesting question relayed from a talking head in the film was:

"Do you think my grandchildren will every get to fly in an aeroplane?"

The answer...

"No."
 
Falcon said:
...
And we are much closer to conditions of social disorder than most people think
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The old three meals away from anarchy thing? Yes, have wondered about that myself. I don't think Greer is quite so optimistic these days...
 
Ahh Obama has announced proposals to expand offshore oil and gas. As usual with these announcements and the articles that are written about them, it doesnt mention peak oil but rather the US politicians favorite way of dressing up the issue 'reduce foreign energy dependency'.

http://news.bbc.co.uk/1/hi/world/americas/8596692.stm

Nowhere is this clearer than when the article mentions Obama saying that US reliance on foreign oil posed a threat, but then goes on to quote something that includes a reference to something that sounds far more like acceptance of peak oil...

Early in his presidency, Mr Obama said US reliance on foreign oil posed a threat.

Outlining his energy priorities then, he said the country would not be held "hostage to dwindling resources, hostile regimes, and a warming planet".
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Speaking as a former employee, it's a bit simpler than that. The function of the enterprise is to maximise shareholder value i.e. the share price. It's not to keep your lights on - that's government's responsibility, which they abdicated some time ago.

The enterprise will profit very significantly in the short to medium term under conditions of increasing resource scarcity. The people running these enterprises are hired by the shareholder to maximise the value of the stock, not to tell you the truth. The share price trades at and is set as a multiple of the market's expectation of future earnings.

So one of the chairman's most significant job responsibilities is to manufacture imagery intended to support the view that future production is sustainable. Obviously once the market realises what those future earnings are (up a bit, then down a lot) the share price will rapidly correct downward to a lower multiple. They need to delay that moment as long as possible.
 
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