New US report acknowledges peak-oil threat

by Steve Ongerth Sun May 08, 2005 08:45 intexile at iww dot org

"Peak Oil" is
about as threatening as the (now largely forgotten) Y2K bug. Let me explain why
I believe this to be so:


I. Demand and consumption are both elastic and do not necessarily correspond to
supply.

The classic Peak Oil theorists are essentially Malthusian--believing that as supply
grows, demand and consumption grow until the peak is crossed. Logic suggests that
this is a gross oversimplification of the real world. Even oil-addicted societies
can deploy methods designed to conserve the oil supply (as as done in the early
1970s, but later abandoned until the gas crisis of 1979).

Furthermore, gas-electric hybrid automobiles, such as the Toyota Prius (which I
drive) or the Honda Insight, reduce gasoline consumption by as much as 67 - 75%
per user. Suppose hybrid technology becomes the dominant automotive trend over
the next ten years? The supply of oil will not change, but the demand and the consumption
rates would plummet.


II. Alternatives to oil exist and are already cost effective.

Most Peak Oil adherents argue that alternatives to oil are pipe dreams or false
hopes. For example, they argue that bio-diesel will not mitigate the oil shortage,
because bio-diesel crops require oil-based fertilizers to produce. I disagree.
Organic farming methods can eliminate the need for fossil-fuel based fertilizers,
but even if fertilizers are still needed, the use of oil for fertilizer is probably
more efficient than the use of oil for internal combustion, so once again, the supply
doesn't necessarily correspond directly to consumption.

Peak Oil alarmists argue that hydrogen is no better, because hydrogen is a carrier
of energy and not a producer, and hydrogen requires more energy to extract than
it saves in usage. Both of these claims, while technically true are utterly meaningless
if they are placed in practical context. Oil is itself, a "carrier" of
energy--not a producer; it, too, has to be extracted and that takes energy. Most
of the energy required in extracting oil for use as an internal combustion engine
fuel is derived from the burning of other fossil fuels. On the other hand, Hydrogen
can be produced using renewable energy. As for hydrogen requiring more energy to
extract than it saves, this claim is only true because the technology for its extraction
as an automotive fuel is in its infancy. Petroleum oil also had its share of "growing
pains" as a resource. Unlike hydrogen and renewables, however, fossil fuel
technology is highly subsidized by the government.

In any case, much of the negative, pessimistic claims about hydrogen are quite thoroughly
debunked by Amory Lovins, who is the CEO of the Rocky Mountain Institute, here:
http://www.rmi.org/images/other/Energy/E03-05_20HydrogenMyths.pdf


III. Renewable energy is a viable alternative and developing rapidly.

Peak Oil alarmists argue that renewable energy could replace fossil fuels, but not
before a serious economic (and perhaps societal) catastrophe, primarily because
renewable energy technology cannot be developed fast enough to prevent it.

This pessimism (or perhaps deliberate fear mongering) is unwarranted. In the March
/ April issue of Solar Today, Donald W. Aitken, Ph.D. describes how Germany is on
a course to generate all of its electricity from renewable resources by 2050. In
fact, they are ahead of schedule. An abstract of the article is available here:
http://www.solartoday.org/2005/march_april05/Germany.htm

The previous issue (January / February) of Solar Today includes an article about
the rapid deployment of solar electricity generation technology in Japan.

EVen China is getting on the bandwagon. The demand for hybrid automobiles is higher
in China than it is in the US.

Peak Oil pessimists (and/or ideologues?) argue that the standard of living that
we "enjoy" here in the United States is what all industrialized nations
aspire to achieve, but Canada, Japan, and much of Europe all enjoy similar standards
of living but use less energy. There's no reason to assume that China will follow
the American model, particularly when the alternatives are cheaper and better!


IV. Peak Oil assumes that oil has biotic origins; it may not.

The idea that the world is running out of oil is based on the notion that oil is
a "fossil" fuel, i.e. that it is the remains of organic material. Suppose
that isn't the case? Suppose, as some Soviet geologists argued for half a century,
oil has abiotic origins and is instead the byproduct of chemical processes that
occur below the earth's crust? Keep in mind that oil is known to exist on Jupiter's
moon Io, and possibly on Venus. Did Paleozoic and Mesozoic lifeforms develop space
flight? Not very likely.

The Peak Oil crowd argue that the abiotic origin theory is pseudo-science, perhaps
as unbelievable as "cold fusion", but what evidence do they present to
back up such a pejorative and ad hominem attack?

Here are some--sadly obscure--discussions about the possibility that oil my not
be the remains of organic matter:

http://www.davesweb.cnchost.com/nwsltr52.html

http://www.davesweb.cnchost.com/nwsltr55.html

http://www.davesweb.cnchost.com/nwsltr59.html

http://www.davesweb.cnchost.com/nwsltr64.html

http://www.davesweb.cnchost.com/nwsltr70.html

While the abiotic oil theory is by no means any less controversial than Peak Oil,
it is also no less a legitimate hypothesis.

by Daniel Mon May 16, 2005 21:34

There are a few things that make it seem that Steve Ongerth is in fact a very big optimist when it comes to corporations and governments doing the right thing for the world. First of all I would like to comment that most agri-corporations are not going to be willing to shell out the money to convert their enormous monocropped farms to small organically viable farms for biodiesel production. These farms have destroyed much of the arable land in the world through their use of petroleum based fertilizers and pesticides and monocropping. It would be difficult and expensive to return this land to an organic operation. On top of this, what about food production? Not that I am saying that there is scarcity of food in this world for there is in fact anything but scarcity (just wastefullness). Further destruction of the earth in the name of feeding humans is unacceptable, but that is what it would take to create a situation in which a biodiesel based structure was possible along with food production.
From there the next step would be the transportation of...well everything. Once again who is going to pay the huge costs of converting everything to biodiesel?
I also have a comment regarding another form of alternative fuel, hydrogen. Steve is correct when he says that hydrogen fuel cells are carriers of energy. As far as there being sustainable methods to create hydrogen I think Steve is way too optomistic about the path that is being taken to build a hydrogen infrastructure. Our old friend King Coal is coming to the forefront as the cheapest way to create hydrogen through hydrolysis. This process of hydrolysis by way of burning coal has been compared in effieciency to the steam engine. Lots of pollution and not a lot of go!. To increase coal production coal companies have turned to the method known as mountain top removal, which is exactly what it sounds like. Mountains are removed and dumped into river valleys releasing toxic heavy metals and destroying ecosystems.
I do agree that we can have a sustainable system built upon renewables that can cushion the blow from oil peaking, but it does not seem that those making the decisions are choosing that path. I seem to see a last man standing situation in our future.

by ASF Mon Aug 22, 2005 12:31 Fallis61 at hotmail dot com

I have some thoughts I wanted to share concerning what I feel would be some of the likely consequences concerning a worldwide peak in oil production should that occur soon. One issue that seldom seems to be addressed is the possibility that peak oil would appear likely to cause an economic crisis by undermining the economic basis for globalization. The United States, for example, has a massive current account deficit with the rest of the world because much of its manufacturing is done by American companies in Third World countries or subcontractors, etc. But with peak oil, making things overseas and shipping them home becomes more and more expensive and at some point simply uneconomic. In effect, the consumers in industrialized countries are not only importing massive quantities of oil directly but also indirectly in the manufactured products they import from the Third World. These countries are much less energy efficient than the First World and obviously shipping the goods is a massive waste of energy as well. This obviously didn't matter much when oil was 10$ a barrel but what about now @ 65$ a barrel? And what about when oil is much more expensive still? There has never been a sustained supply shortage of oil on an international basis in modern times. Do you really think that people would hesitate to pay 100$, 200$ or many more dollars per barrel if they had no immediately available substitute? How could this not result in great inflation in developed countries and severe economic dislocation in Third World countries? Yes, in the long term that may mean that we can bring the jobs back home and open all the factories back up again. It may also mean that we can abandon traditional agriculture and go organic. We could also go build nukes for energy or, if make the wrong choice, return to coal. We could also massively ramp up solar, wind geothermal, etc. Third World countries could develop internal markets based on localized production. In the long run the crisis could open up great opportunities. But how long will doing all of these things take and how much will everything cost when energy is priced rationally? Consider the fact that oil is today priced @ 18-20 cents a pint. Imagine if it was simply priced @ 1$ a pint. That would still be cheap-around the same price as bottled water- but could undermine the economic basis of many societies if such a price increase occurred rather quickly. If oil production peaked in Saudi Arabia, as many now believe it will in the near future, it is very easy to see how this sort of rational price increase could occur quite rapidly. Will we have a complete economic meltdown before we can make the necessary adjustments? Will there be semi-permanent wars for oil around the world as a result? Remember, no amount of technology will get more oil out of the ground when we reach worldwide peak oil-oil production peaked in the U.S. in 1970 and the U.S. still produces less oil than it did then in spite of all the new technology we have today. The difference between the 1970s and now is that when we reach worldwide peak oil there will be nowhere to import more oil from and this would likely make the crisis much worse than it was in the 1970s (when oil went from under 3$ a barrel in 1971 to 40$ in 1980).

Don't forget that prominent supporters of peak oil theory are geologists-like M King Hubbert who predicted in the 1950s that U.S. oil production would peak in 1970 exactly when it did. These people know what they are talking about because there is a very firm scientific basis for much of what they say. It isn't simply a matter of switching to hybrids-we use energy for almost everything we do. Lets look at all the ways we need change society to cope with peak oil and push hard to make those changes now so that we can avoid disaster. If you believe that substitutes for oil could immediately and seamlessly take the place of oil without a worldwide economic/social crisis taking place first I would be interested in what you have to say. Likewise, if you have a scientific quarrel with what Colin Campbell and other geologists say concerning the approaching peak oil event I would like your opinion. I am only saying that I believe we need to act now. Localized economic development (in place of Globalization) large-scale organic agriculture and sustainable non-polluting energy production are necessary and exciting possibilities. As is the development of a comprehensive solution to our need for a new transportation model-both for the transportation of people and goods. But if peak oil is approaching soon and we do not prepare adequately how could we avoid a world economic crisis? Could endless wars for oil (with an escalating threat of nuclear war) be far behind? I think we know the likely results and who would suffer the most under these circumstances...