Another Note On Peak Oil in the mainstream press

April 5, 2004 5:57 AM

Another Note On Peak Oil... That last question is at the center of a fierce debate. Adherents of the "peak oil" theory warn of a permanent oil shortage. In the next five or 10 years, they maintain, the world's capacity to produce oil will reach its geological limit and fall behind growing demand.
posted by jasenlee (30 comments total)

The article minus NYT nag screen.
posted by deadcowdan at 6:15 AM on April 5, 2004

Previous discussion of the Hubbert Peak here and here.

I don't know if these predictions are true, and neither do you. But there are two big reasons to be sceptical about this argument. The first is that predictions of ecological doom have a terrible track record. The best example is the Simon-Ehrlich bet, but almost every other prediction of this type that I learned about when I was younger turned out to be false.

The second problem is that we have a very effective mechanism for communicating that there is a real resource shortage and forcing society to adjust to it: prices. If the scary gasoline pricies pulled out of a hat in the article actually come to pass, then both alternative sources of energy and new technology for oil extraction will suddenly become very profitable, and society will invest massive resources in developing them.

Politically active ecologists need to learn how to argue for their positions without pretending that we actually know what's going to happen, and without needing to be continually making doomsday predictions.
posted by fuzz at 6:22 AM on April 5, 2004

This very well may be true; if not in five years, then probably in 50. My question is: why is this a bad thing? We've run out of fuel options before. Any price increase is not going to happen overnight. As the article states, demand will eventually outpace supply and the price will be pushed ever higher. Now this will hurt in the short term, but how many months of $5 gasoline will it take before Congress and the White House are clamoring for alt-fuel research and actually putting some money into it? How many years before we would have a practical fuel-cell for use in all types of vehicles? How many years before most gas stations serve up hydrogen instead of gas?

I think this is a perfect opportunity for fans of pro-market forces libertarianism. I think the transition to a post-oil economy will be slower and less painful than doom-and-gloom prophecies (which this article is not) tend to assume.

Nevertheless, it's not something to passively wait for. If the politicians of the world were smart (or more accurately, if they could think long-term), they'd be jumping all over the alt-fuel cause, giving out tax breaks and pushing tax penalties for heavy uses of oil products. There's no good reason why we can't be moving quickly away from burning oil beginning today.

On preview, what fuzz says.
posted by deadcowdan at 6:34 AM on April 5, 2004

Then again, the ecological doom theorists will only have a bad track record until the first time they're right :)

Seriously, I agree that the actual transition will be slower. But the problem with trying to artificially stimulate alt. fuel development now is that the transition may be far away (something like 50 years is a hell of a long time in economics). You can hand out all the tax breaks you want, but it may not be until the end of oil looms near that alt. fuels become economically viable for companies to sell.
posted by Krrrlson at 6:38 AM on April 5, 2004

Am I the only one who thinks of The Last Chase everytime there's a peak oil story?
posted by Blake at 6:41 AM on April 5, 2004

Unfortunately, major PhD economists think they're full of crap, and so do I.

Prices will simply rise to the point people don't buy. Okay, let's pretend the government steps in and funds it. In that case taxes will simply rise until people demand reforms. Then we'll pretend the worst: The government goes on a killing spree to steal oil. In *that* case, we deserve to die out as a species and I'll thank you all not to involve me.

One way or another there will ALWAYS be gasoline, it'll just become less affordable.

Unless you're a doomsdayer. In which case, watch for falling asteroids and meteroites. You might get squashed.
posted by shepd at 7:17 AM on April 5, 2004

Oh, by "they're" I do mean the doomsdayers, not necessarialy the article writers. ;-)
posted by shepd at 7:27 AM on April 5, 2004

Fuzz has it absolutely right.

At present oil price levels, it makes no sense to make those investments at a mass level. Petroleum derivatives are extraordinarily efficient in mass to energy terms, and all of the fuel delivery and engine manufacturing infrastructure is already in place.

The negligible-to-dismal return on investment of past substitute power technologies (nuclear, solar, geothermal, etc.) ensures that no one is going to make alternative power moves early. The market is as cruel to people who are too early as it is to people who are too late. Once petroleum prices move to $50 or $60 a barrel for a long period of time, then we'll see billions invested in alternative power strategies, one or more of which will doubtless prove successful.

(Massive European gas taxes are a big hindrance to development -- who wants to put big money into a field when you know the taxocrats in Brussels and the capitals will surely preserve their balance sheets by taxing your brilliant new power system to death?)
posted by MattD at 8:31 AM on April 5, 2004

Mefi got me very interested in the topic several months ago, so I decided to read this book by K. Deffeyes, and start subscribing to the guardian's oil column. Though the book had weak methodology in places it was fairly convincing for several good reasons.

1) It is in everyone's interest to assume that there's more oil than there actually is. The countries, so they can borrow against the value of the reserves, the oil companies so they can please their shareholders. There are also implicit cooperation between other parties (foreign governments won't want panic, bankers don't care too much as long as the money is flowing right at this very minute). The *only* people who suggest there are dark times ahead are geologists (oil petrologists in this case), and the only people who actually know are a company called PetroConsultants in Switzerland which maintain, very secretly, all the figures (if you're not an oil company or government, you can't become a client of theres). The only real block is US law which proved woefully inadequate when Shell revealed that there reserves were 20% lower than they actually were.

2) Every place on earth has been explored with the exception of Antarctica and the South China sea. A quote from the book was "If we're looking for oil in 5000 feet of water, don't you think we've looked everywhere else first?" (May not be an accurate quote, but the gist is there).

3) Many countries have reached their peak of oil production - the US in 1970, the UK in 1999 (we only started being a producer in 1960s). Almost the only countries which have rising oil production are based in the middle-east, or Russia. Big discoveries are getting fewer and fewer, the most major discoveries were made between about 1930-1960, and few major discoveries have been made afterwards.

Technological improvements help of course, but these cost a lot of money. There are plenty of good ways of extracting oil from a well that was closed some years ago because it was unprofitable. However, it would still take a significant (doubling?) of the base crude price before these avenues start to be explored. These allow a longer period of time for oil to peak than the Doom-mongers predict, however, you can expect oil prices, from today, to rise and rise and rise.

If you want an investment that's guaranteed to quadruple in value in the next 10 years, buy a barrel of oil and put it in your shed.
posted by BigCalm at 8:32 AM on April 5, 2004

One way or another there will ALWAYS be gasoline, it'll just become less affordable.

Perhaps - but even if this is the case, gas becoming less affordable (or experiencing wild swings in price) could be almost as traumatic as if it ran out. If you're talking about prices at the pump, sure, folks will drive less, or take the train more often, or buy more fuel efficient cars. The problem is in areas like fertilizer, plastics, and the myriad of industries (beyond just car owners) that rely on fossil fuels to manufacture or grow their products.

Unless you're a doomsdayer. In which case, watch for falling asteroids and meteorites. You might get squashed.

One critical difference between the Peak Oil theory and other tin-foil hat armageddon scenarios is that the Hubbert Curve seems to have accurately predicted the phenomenon, at least at the level of US production. Projecting that to the world may or may not be accurate, but I think there's a bit more to this than "the sky is falling".
posted by jalexei at 8:48 AM on April 5, 2004

A quick note on alternatives:

Nuclear: Is also very finite. We have approximately 100 years supply from existing mines, which would vanish to about 5 years if all current petrol needs were replaced with nuclear

Alcohol: Is a fantastic fuel, better than petroleum, but time and arable land consuming. You'd need an area the size of Britain to grow enough crops to power all the cars in Britain. Other "wonder" fuels from plants tend to be less efficient than this.

Coal: Plentiful, and possibly the only true alternative we have at the moment - stocks of coal with last us at least 250 years, but is an unclean and dirty fuel with lots of impurities.

Gas: We have an estimated further 10-20 years after oil peaks before Gas peaks, but we have little way of knowing. Gas wells run out instantly, without warning - unlike oil where more and more advaned methods need to be used to extract the remaining oil. Of course, if gas use increases dramatically, it'll run out faster, and we'll be in exactly the same position we're in with oil.

Fusion: The holy grail of energy - if we can get fusion power (probably 50+ years away from today) working, we can generate almost limitless quantities of energy with very little waste and very little danger. Which is why I'm very annoyed with the US for first reducing their commitment to funding the international program, then threatening to pull out of the whole program when it was decided that the plant should be based in France.
posted by BigCalm at 8:56 AM on April 5, 2004

BigCalm, it's it's also my understanding that once you take into account the energy costs in all phases of production of biofuel it's barely energy-positive at all. And you don't mention photovoltaics, which although they're continually gaining incremental improvements, still involve a disproportionate energy investment in their manufacture, particularly if you take into account (as you must) the raw materials acquisition and refinement.

Personally I've always thought out best option involved things like giant photoelectric arrays in stable positions in space, e.g. lagrange points, manufactured in space from materials and fuels acquired in space, with the power sent down by maser. There are, shall we say, nontrivial difficulties with this, not least the staggering investment involved in getting started on such an enterprise: it won't be practical until such time as we pretty much have free run of the solar system. And all I can say about that is if we don't get busy on such long term solutions now while energy is cheap, it's sure as hell not going to get easier later on.
posted by George_Spiggott at 9:12 AM on April 5, 2004

It's foolish to ask for a single magic bullet to solve the energy problem. I'll bet a beer on a future with geothermal power in Hawaii, solar power in Arizona, and wind-powered ethanol refineries in Iowa over a future with MASERS FROM SPACE!! or large-scale fusion plants.
posted by yami_mcmoots at 9:43 AM on April 5, 2004

it's also my understanding that once you take into account the energy costs in all phases of production of biofuel it's barely energy-positive at all.

Well, alcohol is the best of a bad lot at the moment, but you're right, if you take into account the energy required to harvest the crops, transport them to a distillery, distil them into some form of alcohol, and transport it to the consumer, you're probably doing slightly better than breaking even.

Personally I've always thought out best option involved things like giant photoelectric arrays in stable positions in space, e.g. lagrange points, manufactured in space from materials and fuels acquired in space, with the power sent down by maser

Surely the risks that the maser might miss it's receiver would be too great to bear? Plus you have potentially big problems with changing atmospheric conditions which will affect the transmission of microwave radiation.

Geothermal energy is a fantastic idea, but is only really applicable (at the moment) in volcanically active areas.

Good solar panels won't be available until we discover a superconductor that can a) function in direct sunlight and b) can be cheaply manufactured, neither look likely in the near future, but I'm interested if anyone knows different.

(Does anyone have any info on South African attempts to synthesise Oil/Petrol from coal? I know they were trying to do it during all the sanctions, but google's not playing today).
posted by BigCalm at 10:22 AM on April 5, 2004

BigCalm: "Nuclear: Is also very finite. We have approximately 100 years supply from existing mines, which would vanish to about 5 years if all current petrol needs were replaced with nuclear"

I'd like to see a source for that, since I was under the impression that Uranium is relatively common.
posted by spazzm at 10:35 AM on April 5, 2004

And you don't mention photovoltaics, which although they're continually gaining incremental improvements, still involve a disproportionate energy investment in their manufacture,

4-5 years is how long it takes a solar cell to make more power than it took to make it.

Wind machines can have a 'energy payback' in less than a year.


Personally I've always thought out best option involved things like giant photoelectric arrays in stable positions in space, e.g. lagrange points, manufactured in space from materials and fuels acquired in space, with the power sent down by maser.

And you have considered the additional heat now 'trapped' in the Earth's biosphere?
posted by rough ashlar at 10:43 AM on April 5, 2004

spazzm - I should really check my sources before I state something. Looks like the hundred year estimate for uranium was based (my apologies). It came from an article by the same author (World Uranium Resources (by K. Deffeyes and I. MacGregor)
Scientific American, January 1980), so he may be off the mark here. More accurate estimates may be made here, and as exploration is now at a minimum for uranium, you could expect that figure to be much higher if uranium demand increased.
posted by BigCalm at 10:58 AM on April 5, 2004

And you have considered the additional heat now 'trapped' in the Earth's biosphere?

The trapping of heat in the form of greenhouse gases is a more serious problem than the introduction of new heat would be. I don't have contrastable numbers so I'll just mention greenhouse gas reduction as a side effect of moving to clean energy sources.

And consider the amount of heat introduced: let's say that the energy delivered is equivalent to the amount of solar energy that falls on an area 5 miles on a side. Compared to the amount of solar absorption going in in, say, the oceans, this is vanishingly small. The great advantage of space-based arrays is that not that they introduce all that much more energy into our environment (they wouldn't) but that it would be conveniently packaged for use: they also require smaller amounts of material (not having to support their weight against gravity), higher efficiencies and are not subject to weather and atmospheric losses.

But yes, it's probably a pipe dream and I wasn't entirely serious in bringing it up. Were we to develop the technical capability to do something so grandiose, assuredly a wealth of other, probably better, options would open up along the way. And as BigCalm mentions, that maser beam would be one scary-assed thing to lose control over.

On preview: BigCalm, one might also consider breeder reactors.
posted by George_Spiggott at 11:04 AM on April 5, 2004

The larges oil reserve in the world is not the Arabian Gulf, but the Alberta tar sands. There is decades more oil in Alberta.

We don't produce (much) gasoline from it (yet) because it's still too expensive, about $10/barrel to extract with few of the light components for gasoline. Saudi oil is about $2/barrel to extract. Technology continues to improve and tar sands "Syncrude" will eventually become economic to produce on a large scale.

The US is addicted to cheap oil. There will be oil for many years to come, but not at the prices we're paying now.
posted by bonehead at 11:16 AM on April 5, 2004

Yes, breeder reactors help - I'd love to see CANDU nuclear plants instead though, which have an outstanding reliability record, rather than the submarine-kludge job (same basic design in both) used in the US, Europe, and Russia.
posted by BigCalm at 11:21 AM on April 5, 2004

Space-based transmission of power by maser doesn't need to use a narrow, concentrated beam of microwave energy. The beam could be - and due to safety concerns and the difficulties of aiming it with pinpoint accuracy from 36,000 km up, probably would be - hundreds of meters across. The idea being that you'd set up a very large array of inexpensive receiver antennae as a "farm" out in the middle of nowhere (Nevada Test Site, perhaps?) and shine it down on that. The antennae would be basically a very big mesh, not hiding the ground from sunlight. Though the beam might contain megawatts, if you spread it out wide enough it wouldn't even heat the air it's passing through. One story I read about such things imagined the antennae covering a large cow pasture up high in Colorado or Wyoming, with cattle grazing contentedly under the array with no discomfort. (I would choose a deserted area first for testing though...)

In fact the beam probably would represent some tiny fraction of the total energy flux from sunlight on that patch of land, but remember that it would all be concentrated in a very narrow frequency bandwidth. Apparently all the math was worked out on this stuff in the 60's, and it's physically feasible, if certainly not currently profitable. Jerry Pournelle assembled a book of stories and information about things like this back in the 70's called The Endless Frontier. Worth a read if you can find it.

I'd worry more about the triple transduction from solar to electric, electric to microwave, microwave to electric than about blasting the ground with a Death Star beam... that conversion would have to be highly efficient to get the most out of the space array/beam system. And hey, if the Space Elevator guys actually build the darn thing, it gets a lot more feasible. You could send up your entire space PV array in one trip and have it operating almost immediately on arrival. (IMO, the Space Elevator development project would be about the smartest place to put the money we currently dump into rockets of dubious reliability and ominous lethality. They need $15 billion. That's not a lot over 20 years, now is it.)

Some interesting developments in cold fusion lately, seen in this thread.
posted by zoogleplex at 11:33 AM on April 5, 2004

Geothermal energy is a fantastic idea, but is only really applicable (at the moment) in volcanically active areas.

I think you're underestimating the amount of volcanic activity on the planet. You don't need a hot spot for geothermal power - check out the loneliest power plant in Nevada, which takes advantage of Basin and Range extensional tectonics (I think; haven't looked at the site in detail).

Also, I've heard about geothermal heat pumps being installed for household heating/cooling even in the Midwest, which is about as tectonically dull as it gets. Does anyone know how cost-effective they are?
posted by yami_mcmoots at 11:58 AM on April 5, 2004

Just thought I'd chip in to giggle at the article's title: Imagining a $7-a-Gallon Future. The AA (Automobile Association, UK) have a page tracking average petrol prices in the UK. That one's from February. If you look at the cheaper type of unleaded, the average price is £3.51 -- that's about $6.40 at current exchange rates. It's mostly tax, but still -- we pay it. It's not the end of the world.

Take a look at the overseas fuel prices page. Note the stupidly low prices in the US. What's with this idea that (from the article) "$1.76 - last week's national average" is a lot? It's nothing. Even if prices go up to $7/gallon, it's hardly the end of the world.
posted by reklaw at 1:12 PM on April 5, 2004

The best way to make more energy available is to use it more efficiently.

Price usually has the effect of making users more efficient.

Though I suspect our grandchildren will recoil in horror at the waste when they are mining plastics out of landfills.

Either that or they will marvel at our foresight of leaving so many raw materials stored within easy reach.

And still checkout clerks get weirded out when you tell them you don't need a bag for things you can carry out in one hand. *sigh*
posted by dglynn at 2:28 PM on April 5, 2004

Price usually has the effect of making users more efficient.

You'd think so, wouldn't you. So how many hybrid cars are sold every year in the UK, with their $6.40/gal petrol? The UK has been on a road-building frenzy for the last decade, and they keep shutting down rail lines. What's wrong with this picture?
posted by George_Spiggott at 2:33 PM on April 5, 2004

So - which is the bigger problem, the possibly (even even likely) impending decline in world oil production, or the historic levels of atmospheric carbon (within maybe millions of years) humans have managed to accomplish with a couple centuries of industrial activity?

First, I have a hard time squaring Yergin's assessment with this graph :



"Historically, then, dire oil predictions have been undone by two factors. One is the opening (or reopening) of territories to exploration by companies faced with a constant demand to replace declining reserves. The second is the tremendous impact of new technology..." Curiously, or strikingly, neither of these two factors have had much of an impact on US oil production.

Basic human profit motivations, I think, are important to the Hubbert Curve dynamic - humans have grabbed the easy oil first. This is to be expected.

Now, I can't rule out the very real possibility that the current - unprecedented - explosion in scientific research and technological development will lead to methods for extracting "difficult" oil reserves that are dramatically cheaper than those available in even the recent past few decades.

We humans are an inventive lot. We may figure out have to keep ourselves in high grade combustible petrochemicals for fifty years or maybe even longer.

Still, that "discovery-consumption gap" is fairly telling.

BUT.......I'd ascribe any impending energy shortage to (mostly) human laziness, quite simply. There are a wide range of new renewable energy technologies which have been barely scratched by this discussion.

As for the economic viability of renewables, I haven't heard anyone on this thread mention the tens of billions of dollars in DIRECT subsidies paid yearly by the US Federal government to the oil, coal, and nuclear power industries - and INDIRECT subsidies run, far higher.

Coal burning is a beastly filthy affair which has been shown to sicken and shorten the lifespans of hundreds of thousands of Americans each year. Who pays? - well, we all do, indirectly, via the USA health care system.

The costs of burning coal and oil are believed to have contributed to the growing destructive force of storms and other natural disasters which have caused great alarm over the past decade on the part of the World's largest reinsurance companies. Insurance losses in the US went up by a factor of about ten times between the decade of the 1980's and the 1990's.....

And there is a rather obvious reason for the British and then the US interference in the politics of Iraq in the 20th Century. I seem to recall George Bush Sr. stating, rather bluntly, on the eve of the First Gulf war - "The American standard of living is not open for negotiation". But the current US oil-centric foreign policy is anything but cheap.

For the many billions the US has spent in Iraq, America could have been - with rather more visionary and courageous leadership - well along the path to energy independence.

Alas.

______________________________________________

"...predictions of ecological doom have a terrible track record. The best example is the Simon-Ehrlich bet, but almost every other prediction of this type that I learned about when I was younger turned out to be false." - Fuzz, wasn't Ehrlich predicting resource exhaustion? That's not quite ecological doom.

But regardless of the timelines, I'd say the example of the reconstructed history of Easter Island cited by Jared Diamond is very instructive, no?

Further, there is one type of planetary resource which is in clear decline - biological diversity. Bjorn Lomborg may be taken seriously by some on the internet, but his views are not especially well represented in the fields he claims authority to speak in. But NASA's satellite photographs of the startling, ongoing burning of forest cover - in Africa's equatorial regions, in Indochina, in many regions all over the globe, speak louder than words or even research. They're worth a look. NASA / "Visible Earth"

______________________________________________

"There was a time, long ago, when people thought that the Earth was flat, but now for several centuries people have believed that the Earth is round . . . like a sphere. But there are problems with a spherical earth, and a now a new paradigm is emerging which seems to be a return to the wisdom of the ancients.

A sphere is bounded and hence is finite, which implies that there are limits, and in particular, there are limits to growth of things that consume the Earth and that live on it. Today, many people believe that the resources of the Earth and of the human intellect are so enormous that population growth can continue and that there is no danger that we will ever run out of anything." - From "The New Flat Earth Society", by A. A. Bartlett
posted by troutfishing at 8:46 PM on April 5, 2004 [1 favorite]

Trout, there is a new paradigm being tossed around that nature provides for abundant and limitless resources and the problem is not lack of resources, but lack of creative thought on how to use them. By some estimates %80 of everything we produce is a waste product with the other %20 being a consumable. If we could be more efficient and better utilize what we have the resource issue could be entirely sustainable. WorldChanging just did an article on it if your interested. It is certainly a less doom and gloom outlook then the standard environmental outlook of delaying an inevitable systemic collapse.. it does require "faith" in an unknown future that we will figure all this out, something I am not ready to entirely subscribe to.

One of the interesting parts of the article is we need to learn how to break things down. We are very good at creating and building things but poor at breaking them back down into usable elements. Like the story of the process that turns any organic matter (leftover Butterball Turkey parts) into oil, stuff like that could be our future.
posted by stbalbach at 9:13 PM on April 5, 2004

trout: Magnificent comment. I shall try to pick up a copy of that Flat-Earth book.

Possibly we are in an Easter island situtation (whoops, we just cut down our last tree situation) with our natural resources, possibly we aren't. I'd like to think we're more similar to the Maori situation, where the people realised what they were doing and tried to do something about it before it was too late.

But there are definite limits - assuming a similar earth population, will we still have oil and gas supplies a thousand years from now? ten thousand? I'd like to recommend The Next Million Years by C.G. Darwin, but sadly it's out of print.
posted by BigCalm at 1:32 AM on April 6, 2004

Anyone who is remotely interested in oil has to read Daniel Yergin's "The Prize" which is an incredible book on the history of oil.

In April 2004, Kenneth Deffeyes spoke at David Isenberg's WTF2004 conference on "The End of the Oil Age."
posted by gen at 3:11 AM on April 6, 2004

stbalbach - ""there is a new paradigm being tossed around that nature provides for abundant and limitless resources and the problem is not lack of resources" : is the really the paradigm?

I'm familiar with the calls for dramatic increases in energy and materials utilization, and the call - in Europe at least - for a X10 increase in energy and materials efficiency has been ongoing for the better part of the decade.

This is where Julian Simon and Paul Ehrlich meet, in reality.

The Earth is not limitless, nor are natural resources or the biological carrying capacity of the Earth. This is not at all what the energy efficiency gurus claim - I'm fairly sure this is what you meant though...

What they would instead suggest is that human creativity, inventiveness, and imagination are close to limitless and - by making full use of these - we may be able to learn to live within the limits afforded by our planet.

Julian Simon, founder of the "Cornucopian" school (of thought on resources and resources limits) did not think resources, per se, were limitless but - rather - that humans could think their way around resource limits.

I'm all for resource efficiency and do agree with Simon, on his point of faith that we can think our way out of the problem. We'd best get cracking.

___________________________________________

BigCalm - Thanks. But we don't know that the Easter Islands were unaware of what they were doing. Perhaps they just couldn't exercise the political control to stop the process. The Maori, by the way, did manage to wipe out all their "Moa" : Big flightless "chickens"......big cook-pots! (hungry Maori)

That quote you liked linked to a short article, BTW. A. A. Bartlett was a prominent physicist with a healthy contempt for foggy thinking.

_____________________________________________

I think that there's an interplay between Cassandras and "Why worry" types built into the human fabric, as naturally occurring personality types who influence the mushy middle. Overall, I'd say the system (if I'm correct) works well - except when it doesn't. I think that, now, civilization has overrun human instinctual checks and balances.
posted by troutfishing at 2:55 PM on April 6, 2004