Oil is running out…

Yet more fuel into this fire that has been on slowburn on this blog over the last few weeks. George Monbiot, yes I know some of you hate him, with his views on the likely scenarios that may meet us once the oil runs out.

I think Frank will enjoy this…and he also mentions issues raised by Peter. Monbiot deals with some of the issues we raised earlier:

The world’s problem is as follows. We now consume six barrels of oil for every new barrel we discover. Major oil finds (of over 500m barrels) peaked in 1964. In 2000, there were 13 such discoveries, in 2001 six, in 2002 two and in 2003 none. Three major new projects will come onstream in 2007 and three in 2008. For the following years, none have yet been scheduled.

The oil industry tells us not to worry: the market will find a way of sorting this out. If the price of energy rises, new sources will come onstream. But new sources of what? Every other option is much more expensive than the cheap oil that made our economic complexity possible.

The new technology designed to extract the dregs from old fields is expensive and doesn’t seem to work very well, which is why Shell was forced to downgrade its anticipated reserves (other companies, under pressure from the US Securities and Exchange Commission, will surely follow). Extracting oil from tar sands and shales uses almost as much energy as it yields. The same goes for turning crops such as rape into biodiesel. Nuclear power is viable only if you overlook both the massive costs of decommissioning and the fact that no safe means has yet been discovered of disposing of the waste. We could cover the country with windmills and solar panels, but the electricity they produced would still be an expensive means of running our cars.

Just as the oil supply begins to look uncertain, global demand is rising faster than it has done for 16 years. Yesterday morning, General Motors announced that it is spending $3bn on doubling its production of cars for the Chinese market. Seventy-four minutes later, we saw the first signs of entropy: the International Air Travel Association revealed that the airlines are likely to lose $3bn this year because of high oil prices. The cheap carriers complained that they could be forced out of the market.

If the complexity of our economies is impossible to sustain, our best hope is to start to dismantle them before they collapse. This isn’t very likely to happen. Faced with a choice between a bang and a whimper, our governments are likely to choose the bang, waging ever more extravagant wars to keep the show on the road. Terrorists, alert to both the west’s rising need and the vulnerability of the pipeline and tanker networks, will respond with their own oil wars.

“Every time I see an adult on a bicycle,” HG Wells wrote, “I no longer despair for the human race.” It’s a start, but I’d feel even more confident about our chances of survival if I saw George Bush and Dick Cheney sharing a car to work.

3 thoughts on “Oil is running out…”

  1. George is repeating what he understands of the arguments of Colin Campbell, a retired geologist who seems to be the Victor Meldrew of the oil industry.

    I’d recommend that anyone who is interested in the topic go to Campbell’s work directly and avoid GM’s pathetic blundering around; Campbell has interesting points to make, but going from geology to technology and then economics is difficult; I think Campbell falls down on it, but Monbiot just hasn’t done proper research for this article.

    Campbell’s work is published and publicised at http://www.peakoil.net/

    As you can tell from the site, this is an effort by the converted, who include pessimistic geologists and various fringe greens.

    As well, note that this push translates directly into financial gain for the oil industry through higher prices or its servicing businesses if there are new tax breaks for exploration or more mergers among oil companies.

    Lomborg, in the absence of any more credible scholarship I’ve found online, says more about this topic and describes the feedback between reserves and prices in this archived report from the Guardian.

    http://www.guardian.co.uk/Archive/Article/0,4273,4239923,00.html

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