Peak Oil : The Party's Over

Matt Savinar in "Life After The Oil Crash" makes a compelling case on Peak Oil and the impending oil crisis.

Beneath the doomsday rhetoric are some engaging metaphors and projections:

The human body is 70 percent water. The body of a 200 pound man thus holds 140 pounds of water. Because water is so crucial to everything the human body does, the man doesn't need to lose all 140 pounds of water weight before collapsing due to dehydration. A loss of as little as 10-15 pounds of water may be enough to kill him.

In a similar sense, an oil-based economy such as ours doesn't have to deplete its entire reserves of oil before it begins to collapse. A shortfall between demand and supply as little as 10-15 percent is enough to wholly shatter an oil-dependent economy and reduce its citizenry to poverty...

Many geologists expect that 2005 will be the last year of the cheap-oil bonanza, while estimates coming out of the oil industry indicate "a seemingly unbridgeable supply-demand gap opening up after 2007," which will lead to major fuel shortages and increasingly severe blackouts beginning around 2008-2012.

Global oil discovery peaked in 1962 and has declined to virtually nothing in the past few years. We now consume 6 barrels of oil for every barrel we find. Significant new oil discoveries have become so scarce that oil companies are unable to earn back the money they spend exploring for it, despite record high oil prices.

One of George W. Bush’s energy advisors, energy investment banker Matthew Simmons, has spoken at length about the impending crisis. In an August 2003 interview with From the Wilderness publisher Michael Ruppert, Simmons was asked if it was time for Peak Oil to become part of the public policy debate. He responded:

"It is past time. As I have said, the experts and politicians have no Plan B to fall back on. If energy peaks, particularly while 5 of the world’s 6.5 billion people have little or no use of modern energy, it will be a tremendous jolt to our economic well-being and to our health — greater than anyone could ever imagine."

When asked if there is a solution to the impending natural gas crisis, Simmons responded: "I don’t think there is one. The solution is to pray. Under the best of circumstances, if all prayers are answered there will be no crisis for maybe two years. After that it’s a certainty."

The article is well-linked pointing to such nuggets as:

• The average desktop computer consumes 10x its weight in fossil-fuels just during its construction.



• "The Party's Over" author Richard Heinberg's article on why the peak looks more imminent than ever.



• Jevon's Paradox: energy efficiency is obliterated by corresponding increase in energy consumption.



• Why alternative fuels pale in comparison to the energy density of oil. A barrel of oil contains the energy-equivalent of almost 25,000 hours of human labor. While a barrel of oil currently sells for about US$45, it only takes $1.00 to actually pull a barrel of oil out of the ground in Iraq. In Saudi Arabia, it only takes $2.50, while in the US it it takes $10.00 per barrel. The global average is about $5.00/barrel.

MORE.

Additional reading:
Matthews Simmons: Oil may have peaked, Aljazeera.net
Marianne Lavelle: Hostage to oil,USNews.com
Mick Winter: Peak Oil, include me out, DryDipstick.com
[Blog credit: Adam Curry]