ruppert matthew simmons
June 12, 2003 5:09 PM   Subscribe

 
This is suspect: either the transcription is inaccurate or the speaker he quotes is a lousy source of insight, as there are plenty of factual errors and lots of speculation backed by no relevant facts. Nuclear energy arrived in the 1970s? I don't think so. Current "conventional wisdom" must be wrong just because one element of previous conventional wisdom was wrong? That's clearly specious logic. And so on...
posted by twsf at 5:32 PM on June 12, 2003


fwiw, here're greenspan's remarks from a couple days ago :D
In summary, the long-term equilibrium price for natural gas in the United States has risen persistently during the past six years from approximately $2 per million Btu to more than $4.50. The perceived tightening of long-term demand-supply balances is beginning to price some industrial demand out of the market. It is not clear whether these losses are temporary, pending a fall in price, or permanent.

Such pressures do not arise in the U.S. market for crude oil. American refiners have unlimited access to world supplies, as was demonstrated most recently when Venezuelan oil production shut down. Refiners were able to replace lost oil with supplies from Europe, Asia, and the Middle East. If North American natural gas markets are to function with the flexibility exhibited by oil, unlimited access to the vast world reserves of gas is required. Markets need to be able to effectively adjust to unexpected shortfalls in domestic supply. Access to world natural gas supplies will require a major expansion of LNG terminal import capacity. Without the flexibility such facilities will impart, imbalances in supply and demand must inevitably engender price volatility.

As the technology of LNG liquefaction and shipping has improved, and as safety considerations have lessened, a major expansion of U.S. import capability appears to be under way. These movements bode well for widespread natural gas availability in North America in the years ahead.
LNG, nuke or alt.energy!
posted by kliuless at 5:53 PM on June 12, 2003


If at some point we can't pump oil out of the ground, maybe we'll just have to make it ourselves.
posted by Mark Doner at 6:18 PM on June 12, 2003


basically...
posted by Wizzle at 7:37 PM on June 12, 2003


twsf - If you had researched the issue first, you would have discovered that you were absolutely wrong, and that Simmons' statement was accurate:

Nuclear Power, as a significant U.S. energy source, only emerged in the 1970's. I ran a Google search - check the first link on the page (a 500K PDF doc. It has the graphs of U.S. energy consumption since the mid 1600's ): Here

Perhaps you might be interested in researching the issue further? - you could discover that quite a significant number of energy experts and, indeed, petroleum geologists believe in the "Peak Energy" theory. You see, it has a proven track record of accurate prediction.

dailygrowl - Thanks for the link.
posted by troutfishing at 8:46 PM on June 12, 2003


Very interesting. I'm inclined to write off anything that comes out of From The Wilderness. That said, it's thought provoking and throws around enough jargon to sound plausible to the clueless (e.g. me). The possibility of an unexpectedly near-term (e.g. less than 25 years) collapse in fossil fuel supply would make Bushcos forray's into Irak more understandable as a security rather than a pecuniary move. On the other hand, if the junta was really worried about this you would think they would be working on demand reduction and more broad-based alternatives research.

TFTL.
posted by alms at 12:32 AM on June 13, 2003


Association for the Study of Peak Oil (pdf):
The world oil depletion curve, above, is based on all available information on oil reserves and estimates of the amounts yet-to-find, and indicates that world oil production will reach a peak around 2010 and decline thereafter. The seminar evaluated the evidence for this forecast, and addressed the important political and environmental consequences.
A more skeptical view:
"There's a lot of phony baloney in there," said economist Michael Lynch of the U.S. business forecasting firm DRI-WEFA. "A lot of prominent geologists just laugh at this."
(for lots more google "Peak Oil")
posted by alms at 1:05 AM on June 13, 2003


I am glad someone finally posted something about Simmons, (I did it earlier here and here).

I was at the ASPO meeting (I write about energy resources, among other things technological), seated right behind Ruppert, and frankly, it was very sad that Simmons couldn't come to Paris (he gave his speech via video link). I wanted to interview him so badly! I mean, he's a Texan, he's a banker, he's friend of Bush, and he's crying wolf!!!! Not that this doesn't make sense at all, he defends some sort of Apollo program for energy in the XXI century, which would mean a heavy investment (he’s a energy investment banker, after all), but also, he's one of the few “money people” that doesn't speak like other bankers. He knows very well everything concerning the dirty stuff of extracting, refining and transporting oil, the differences between conventional and non-conventional oil, the problems with natural gas in North America, etc, etc.

Concerning Michael Lynch, he seems to be the king of the flat earth economists bunch, I don't think this is a question of being too pessimist, those geologists (I mean the old, retired geologists like Campbell and Laherrère) know their stuff, economists like Lynch just have faith in that energy markets will follow the laws of the rest of the markets.

I think that the bottom line with energy economics is thermodynamic laws, energy is a prerequisite to do any kind of work, and you always have to spend some energy to get usable energy. Mix this with a serious Energy Return Of Investment analysis, and some physics of fossil fuel discovery and recovery and you'll have a clearer picture of our energy situation than that Lynch and other flat earth economists will ever offer.

The last day of the Paris conference, a bunch of speakers and some journalists went to have an informal dinner. I will remember forever Jean Laherrère holding up a very big glass of beer (somewhat depleted), and shouting it's half empty!, it's half empty! (Campbell, Defeeyes, Laherrère et al are called the "half empty barrel geologists").

Some more references:

Joyride to Collapse is a 1996 article written by Jim Minter. He explores the possible scenarios of a global energy crisis caused by a shortage of cheap oil.

Yahoo Groups Energy Resource List: Tons of messages, discussions and references. Very informative.

ASPO website: includes the proceedings of the two annual meetings of ASPO so far, last year in Uppsala (Sweden) and this year in Paris.
posted by samelborp at 2:16 AM on June 13, 2003


samelborp - thanks for those links. Here are some more, and also a very
telling graph: the ratio between oil discovery rates and oil consumption
rates. It makes the overall situation quite clear.

"It appears that total [oil] discovery in 2001 was about 8 Gb
including deepwater oil, and NGL. Although there remain the eternal
uncertainties about the reliability of the data, it appears that the
world's oil account has been running a deficit since 1981
, as it
continues to eat into its inheritance from past discovery...."

[from the Hubbert Peak website]



Here is the Hubbert Peak website:
""  Named after the late Dr. M. King Hubbert, Geophysicist, this
website provides data, analysis and recommendations regarding the
upcoming peak in the rate of global oil extraction." "



alms - if you look at the Yahoo article I cite from below, "Oil
Experts Draw Fire For Warning"
(Yahoo, May 24, 2003) you will see
the overall context of Mr. Lynch's "Phoney Baloney" quote. First of all,
despite the title of Yahoo article, it's actual content implies
just the opposite, for Lynch voices the ONLY opposing viewpoint cited in
the article. So the article's title is quite inaccurate and should
actually read: "Business analyst's opinion critical of informed views of
a wide group of experts." Rather different, no?

[ from the article ] "Global supplies of crude oil will peak as early as
2010 and then start to decline, ushering in an era of soaring energy
prices and economic upheaval — or so said an international group of
petroleum specialists meeting Friday.

They hope to persuade oil-dependent countries like the United States to
stop what they view as a squandering the planet's finite bounty of
fossil fuels.

Americans, as the biggest consumers of energy, could suffer a
particularly harsh impact on their lifestyle, warned participants in the
two-day conference on oil depletion that began Thursday at Uppsala
University in Uppsala, Sweden.

"There is no factual data to support the general sense that the world
will be awash in cheap oil forever," said Matthew Simmons, an investment
banker who helped advise President Bush (news - web sites)'s campaign on
energy policy. "We desperately need to find a new form of energy....

"There's a lot of phony baloney in there," said economist Michael
Lynch of the U.S. business forecasting firm DRI-WEFA. "A lot of
prominent geologists just laugh at this."


"There are wolves out there, but if you keep crying wolf and no wolves
show up, you start to lose credibility," Lynch said by phone from his
office in Lexington, Mass.

[ NOTICE: Lynch neither cites any evidence, nor any names of experts
holding contesting views. I'm sure they exist, but if his opinion is
actually informed I would expect that he would be able to cite opposing
views and material.]

The dispute centers on the precise timing of what is variously described
as "peak oil" or "the big rollover" — the predicted date when existing
oil production, together with new discoveries of crude, can no longer
replenish the world's reserves as quickly as consuming countries are
depleting them.

Roger Bentley, head of The Oil Depletion Analysis Center, insisted that the predictions made in the 1970s were
basically correct. About 50 countries, including the United States, have
already passed their point of peak oil output, he said.

Campbell insisted the true figure for reserves is closer to 2 trillion
barrels, due partly to what he described as overstated reserves reported
by Saudi Arabia and other OPEC nations.

He played down the significance of new oil discoveries in the Caspian
Sea region of central Asia and in deep waters off the coasts of Brazil
and West Africa and in the Gulf of Mexico. Now that geologists have
effectively surveyed the globe for crude, Campbell and others at the
conference said they doubted that any giant new oil fields still await
discovery....As a result, Campbell forecast that oil output would peak
by 2010 — at least 26 years sooner than the rollover point predicted in
a U.S. government study prepared in 2000.

"It's not a cataclysmic event," he said. "But oil will become scarcer
and more expensive. That's undeniable." ...Campbell estimates peak-year
production at about 87 million barrels a day, compared to daily output
last month of 74.5 million barrels, as calculated by the International
Energy Agency, a watchdog agency for the world's wealthiest nations.

Simmons, the banker, predicted that the United States would suffer an
energy scare even sooner, due to a 10 percent decrease he foresees in
U.S. production of natural gas this year. "If it's only 10 percent,
we've dodged a bullet," he said. "And 10 percent is a disaster. It could
be 20 percent." ...Simmons, based in Houston, said Americans will have
to embrace coal and even nuclear power once fossil fuels pass their
global peak in production. Higher and more volatile prices are sure to
accompany the transition period, he said.

"You couldn't get serious people focusing on this issue, and we're going
to pay dearly for it."

US EIA reports natural gas shortfall:



US oil stocks evaporate to 27-year low by Heather Stewart, The Guardian
[January 16]

[ from the above linked article] "Inventories are down to their
second-lowest level since records began in 1976 as the oil workers'
strike in Venezuela holds back supply, the US department of energy
revealed yesterday. ....With the build-up to a conflict in Iraq
accelerating, Mr Horsnell said, there was considerable potential for
interruptions in supply in coming months. "What's alarming about this is
that it's got nothing to do with Iraq - it's got nothing to do with the
Middle East," he said."

Notice the implications of this: there is a very tight balance
between production and consumption
of petroleum.

THE END OF CHEAP OIL by
Colin J. Campbell and Jean H. Laherrère, Scientific American, March 1998

Oil Crisis Looms In New Millenium, World reserves near depletion, petroleum geologists warn By Peter Beaumont and John Hooper, London Observer August
9,1998

THE IMMINENT PEAK OF WORLD OIL PRODUCTION Presentation to a House of Commons All-Party Committee, by Colin Campbell on July 7th 1999

SPENDING OUR GREAT INHERITANCE -- THEN WHAT? by Walter Youngquist ( Geotimes, July 1998, pages 24-26. )

Are We Running Out of Oil? L.B. Magoon NOTE: Magoon, a member of the USGS, is here issuing a stinging broadside of an attack on the official USGS position on world oil reserves. The actual USGS graph posted DIRECTLY contradicts the USGS official position.

Prosepct Magazine: "After Oil" (November 2000) : "The weightless economy still has dirty old oil pumping through its
veins, as the recent fuel blockades demonstrated says David Fleming. In the next ten years, the growing demand for oil will permanently overtake a shrinking supply -- playing havoc with price. Why are western governments doing nothing to prepare?"

Invited oral testimony (limited to 5 minutes) given by A.A. Bartlett to the Subcommittee on Energy of the Science Committee of the U.S. House of Representatives, May 3, 2001, in Room 2318 of the Rayburn House Office
Building in Washington, D.C.

"Mr. Chairman and Members of the Committee:

My name is Albert A. Bartlett. I am Professor Emeritus at the University
of Colorado at Boulder where I have been a member of the Faculty of the
Department of Physics since 1950.



Our national energy situation is a mess!

For years we have seen recommendations from the Department of Energy
that suggest that the leaders of the Department have little scientific
understanding of the problems of energy.

We have seen the President of the United States sending his Secretary of
Energy on bended knee to plead with OPEC leaders to increase petroleum
production so as to keep our gasoline prices from rising. For a country
that boasts that it is the world‚s only superpower, this is profoundly
humiliating.

Gasoline prices are rising. California currently has an electrical
energy crisis that is likely to spread. Natural gas prices are rising
rapidly, which poses real economic hardship for millions of American
home owners who depend on natural gas to heat their homes in the winter.

The only energy proposals we see are for short-term fixes, sometimes
spread over a few years, that seem to ignore the important real-world
realities of resource availability and consumer costs.

For years, scientists have warned that fossil fuels resources are finite
and that long-range plans should be made. These plans must recognize
that growing rates of consumption of fossil fuels will lead,
predictably, to serious shortages that are now starting to appear.

For years we have heard learned opinions from non-scientists that
resources are effectively infinite; that the more of a resource that we
consume the greater are the reserves of that resource; and that the
human intellect is our greatest resource because the human mind can
harness science and technology to solve all of our resource shortages.

There seem to be two cultures; science and non-science. Each has its
own Ph.D. „experts‰ and „think tanks.‰ Each has its own lobbyists who
argue vigorously that their path is the proper path to achieve a
sustainable society. So let‚s compare the two recommended paths.

The centerpiece of the scientific path is conservation; hence it is
appropriate to call this path the „Conservative Path.‰ On this path the
federal government is called on to provide leadership plus strong and
reliable long-term support toward the achievement of the following
goals. The U.S. should:

1) Have an energy planning horizon that addresses the problems of
sustainability through many future decades. 2) Have programs for the
continual and dramatic improvement of the efficiency with which we use
energy in all parts of our society. Improved energy efficiency is the
lowest cost energy resource we have. 3) Move toward the rapid
development and deployment of all manner of renewable energies
throughout our entire society. 4) Embark on a program of continual
reduction of the annual total consumption of non-renewable energy in the
U.S. 5) Recognize that moving quickly to consume the remaining U.S.
fossil fuel resources will only speed and enlarge our present serious
U.S. dependence on the fossil fuel resources of other nations. This
will leave our children vitally vulnerable to supply disruptions that
they won‚t be able to control. 6) Finally, and most important, we
must recognize that population growth in the U.S. is a major factor in
driving up demand for energy. This calls for recognizing the conclusion
of President Nixon‚s Rockefeller Commission Report (Commission on
Population Growth and the American Future, 1972). The Commission
concluded that it could find no benefit to the U.S. from further U.S.
population growth.

In contrast, the non-scientific path suggests that resources are
effectively infinite, so we can be as liberal as we please in their use
and consumption. Hence this path is properly called the „Liberal Path.‰
The proponents of the Liberal Path recommend that the U.S. should:

1) Make plans only to meet immediate crises, because all crises are
temporary; 2) Not have government promote improvements in energy
efficiency because the marketplace will provide the needed improvements.
3) Not have government programs to develop renewable energies
because, again, the marketplace can be counted on to take care of all of
our needs. 4) Let fossil fuel rates continue to increase because to
do otherwise might hurt the economy. 5) Dig and Drill. Consume our
remaining fossil fuels as fast as possible because we „need them.‰
Don‚t worry about our children. They can count on having the advanced
technologies they will need to solve the problems that we are creating
for them. 6) Claim that population growth is a benefit rather than a
problem, because more people equals more brains.

We should not be confused by the conflicting expertise that supports
each of these two paths because there is a very fundamental truth:

For every Ph.D. there‚s an equal and opposite Ph.D.

For our U.S. energy policy, we must choose between the Conservative and
the Liberal Paths. The paths are the exact opposites of each other.
Each is advocated by academically credentialed experts. On what basis
can we make an intelligent choice?

There is a rational way to choose. If the path we choose turns out to
be the correct path, then there‚s no problem. The problems arise in
case the path we choose turns out to be the wrong path. It follows then
that we must choose the path that leaves us in the less precarious
position in case the path we choose turns out to be the wrong one.

So there are two possible wrong choices that we must compare.

If we choose the Conservative Path that assumes finite resources, and
our children later find that resources are really infinite, then no
great long-term harm has been done.

If we choose the Liberal Path that assumes infinite resources, and our
children later find that resources are really finite, then we will have
left our descendants in deep trouble.

There can be no question. The Conservative Path is the prudent path to
follow.

However, it is the Liberal Path that we are so eagerly taking today.

If resources turn out to be infinite, then we will be OK on the Liberal
Path. But if resources turn out to be finite, then today‚s choice of
the Liberal Path will create enormous and critical problems for our
children.

I thank you for this opportunity to share my views with you."

posted by troutfishing at 8:39 AM on June 13, 2003


Great post troutfishing! I've been following this issue for more than three years, and I am astonished that, in spite of overwhelming evidence, nobody seems to take this matter seriously.

Let me add two more sources of good information.

First is Julian Darley's Global Public Media, who has now quite a collection of video interviews, available also as audio and transcripts, featuring Campbell, Simmons, Deffeyes and Michael Klare among others experts (Klare, author of Resource Wars gave a very interesting presentation at the ASPO meeting in Paris about how natural resources depletion will translate into wars.

Also, there's The Party's Over - Oil, War, and the Fate of Industrial Societies , by Richard Heinberg (interviewed by Global Public Media here), perhaps the best summary of the consequences of the end of cheap energy.
posted by samelborp at 10:36 AM on June 13, 2003


samelborp - Thanks for your material too. That post took far too long. But I'm glad I spent the time, because I think we're going to see some serious fallout from these trends very, very soon. I've been tracking this story for about the same length of time as you, and wonder the same thing: why the lack of attention paid to this? If you want to do a collaborative info page, let me know (my email's in my profile now). I like to do that from time to time, and I've been thinking about the oil depletion issue as a topic for such a project.

To venture one answer to your (implied) question - it's the "long term trend inattention" phenomenon (AKA the "boiled frog" phenomenon).

One thinker, Reg Morrison (author of "The Spirit in the Gene") argues that human myopia about long term trends is genetically innate, a built in evolutionary trap which serves a regulatory function within the larger Gaian "geophysiology"; Myopia about long term trends, Morisson argues, serves as a check to potentially catastrophic species population explosions. Speculative, yes, but intriguing.

The "oil depletion denial" saga is all of a piece with denial of Global Climate Change and the possibilities of Sudden Climate Change, The problem of persistent environmental pollutants, and other such problems: all of these are problems resulting from the pressures of the current extraordinary human overpopulation, from industrialism, and from the culture of consumption.

Further, the subject is really a subset of the "Cornucopianism vs. Limits to Growth" debate; many of the "Cornucopians" are driven by what amounts to, really, a manic, quasi-religious belief that resource depletion is impossible.

There are two schools of Cornucopianism. The "Paleo/retarded" school (my term, 'nuff said) and the "Julian Simon" school which holds that, as resources become scarce, rising prices spur the discovery/construction/synthesis/development of superior replacement resources. This latter school is quite serious and takes much more time to refute than the "stupid" school. Elements are not even logically refutable - except for the fact that the Julian Simon school would eventually require that humans replace all of the functions and services provided by the biosphere as it progressively degrades under the weight of a human population seven or eight billion strong.

However the project of replacing the entire biosphere's services and, in the course of this, paving over the whole planet, is not technically impossible and could occur in the larger framework of the rush towards the "Singularity".

Most environmentalists suggest that a catastrophic collapse would occur first, and that this technophile fantasy I'm sketching out betrays a fantastic ignorance of the fantastic complexity of the biosphere and our utter reliance on it.

By the way, Sudden Climate Change (see the Woods Hole website for an authoritative rundown) could dramatically amplify the oil/gas depletion problem. Bob Gagosian, WHOI Director, briefed the most recent World Economic Forum on this. He thinks (along with many in the field) that it's inevitable.

Sudden Climate Change - especially the sudden cooling many are now predicting - would be catastrophic , especially when coupled with Oil and Natural Gas depletion.

These concurrent trends could hit us within twenty years, but possibly within even a year from now.
posted by troutfishing at 2:37 PM on June 13, 2003


This is probably the most depressing thread I've read on Metafilter.
posted by 40 Watt at 2:57 PM on June 13, 2003


40 Watt - Crank up yer bulb a little. The history of the 20th Century - WW1, WW2, the Great Depression, Stalin's Purges, all the genocides and massacres, Korea, Vietnam, the Cold War, and so on - was no picnic either.

You might not be less happy if these trends panned out, for happiness is what you make it.
posted by troutfishing at 3:26 PM on June 13, 2003


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