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In early November, the price of oil approached $100 per barrel and gasoline prices started their upward march again. Although some of the increase was attributed to geopolitical tensions and a weak dollar, a big factor was record low inventories.
An October 2007 report by the Energy Watch Group (EWG) shows that the rate of global oil extraction "peaked" in 2006 at 81 million barrels per day (mbd). They predict a decline rate of 3 percent per year due to the inability of new projects to make up for aging and depleting "giant" oil fields.
Additionally, we face an alarming shortfall of new oil discoveries; we are discovering smaller fields with harder-to-get oil. EWG projects that in 2020, the world will be producing only 58 mbd, while the demand is expected to be over 100 mbd!
Increasingly, oil industry insiders are voicing fears that access to cheap, abundant energy supplies are behind us. A survey of 155 oil experts, recently conducted by Case Western Reserve University, targets "2010 or earlier" as the peak of global oil production. Remember, they are not saying we are running out of oil, just that the amount we can extract will decrease, regardless of the investment made. (An excellent source of information are the links on APPLE's Web site: www.apple-nc.org)
As oil production stagnates and demand for energy continues to grow (especially from India and China), prices will soar. $5 per gallon gasoline can't be ruled out next year, especially if the hurricane season is severe. The gap between growing demand and faltering supply is already creating power shortages in poor countries, who are outbid by wealthier countries.
Matthew Simmons, a former energy advisor to the Bush administration, has predicted $200-plus per barrel oil by 2010, which equates to $7 per gallon gasoline. That economic shock doesn't include the taxpayer expense of fighting oil wars and protecting oil supply routes.
Meanwhile, many oil-producing countries are reducing oil exports at a faster rate than their oil production is falling as they attend to their own energy needs first. According to Jeffrey J. Brown, we are facing an annual decline rate in net oil exports of "as much as 12 percent per year ... exports from the top exporters are falling about three to four times faster than world oil production is falling."
What amazes me is how little media attention is being given to this huge threat to our collective well being. Businesses and local governments continue planning for business as usual - more construction, the widening of highways, expanding airports - as if ever-increasing amounts of oil will be available. A sober look at the data and trends suggests the urgent need to transition to an economy that can function on less energy.
Peak Oil will soon be unable to be ignored by the media due to high energy prices and the first reports of shortages. But for now, this is an emergency, and it is being treated as a concern. We can't wait until the federal government "gets it"; we have to approach this as a local emergency-preparedness issue.
Our county and city leaders should develop contingency plans. What do we do when oil is two or three times as expensive, or when we have serious shortages? How about creating an Energy Transition Task Force, made up of citizens, nonprofit energy groups, business leaders, local government officials and regional energy experts? That is what Portland, Ore., and many towns and counties are doing already.
Although we should have started planning 20 years before oil peaked to avoid disruptions to our economy (according to the Hirsch report for the U.S. Dept. of Energy), we are where we are and we have to start immediately. The citizen volunteers of APPLE would happily arrange for experts to meet with city and county officials to get this process moving.
Obviously, conservation of electricity, oil and natural gas will play a huge role in any successful energy-transition plan. People are gradually changing their habits - just not fast enough, given the energy crisis that is looming.
Using fossil fuels gives each American the equivalent muscle power of 300 people working for us, 24 hours a day: doing our laundry; heating our homes; fertilizing, harvesting and trucking our food; lighting our hospitals; moving our cars.
What will it be like for all us to lose half of this essential work force, the energy at the foundation of our daily lives? It seems we'll all find out in the coming decade.
ooo
Tem Tarriktar is a local business owner and board member of the Alliance for a Post-Petroleum Local Economy (APPLE of Nevada County). He can be reached at info@apple-nc.org.
An October 2007 report by the Energy Watch Group (EWG) shows that the rate of global oil extraction "peaked" in 2006 at 81 million barrels per day (mbd). They predict a decline rate of 3 percent per year due to the inability of new projects to make up for aging and depleting "giant" oil fields.
Additionally, we face an alarming shortfall of new oil discoveries; we are discovering smaller fields with harder-to-get oil. EWG projects that in 2020, the world will be producing only 58 mbd, while the demand is expected to be over 100 mbd!
Increasingly, oil industry insiders are voicing fears that access to cheap, abundant energy supplies are behind us. A survey of 155 oil experts, recently conducted by Case Western Reserve University, targets "2010 or earlier" as the peak of global oil production. Remember, they are not saying we are running out of oil, just that the amount we can extract will decrease, regardless of the investment made. (An excellent source of information are the links on APPLE's Web site: www.apple-nc.org)
As oil production stagnates and demand for energy continues to grow (especially from India and China), prices will soar. $5 per gallon gasoline can't be ruled out next year, especially if the hurricane season is severe. The gap between growing demand and faltering supply is already creating power shortages in poor countries, who are outbid by wealthier countries.
Matthew Simmons, a former energy advisor to the Bush administration, has predicted $200-plus per barrel oil by 2010, which equates to $7 per gallon gasoline. That economic shock doesn't include the taxpayer expense of fighting oil wars and protecting oil supply routes.
Meanwhile, many oil-producing countries are reducing oil exports at a faster rate than their oil production is falling as they attend to their own energy needs first. According to Jeffrey J. Brown, we are facing an annual decline rate in net oil exports of "as much as 12 percent per year ... exports from the top exporters are falling about three to four times faster than world oil production is falling."
What amazes me is how little media attention is being given to this huge threat to our collective well being. Businesses and local governments continue planning for business as usual - more construction, the widening of highways, expanding airports - as if ever-increasing amounts of oil will be available. A sober look at the data and trends suggests the urgent need to transition to an economy that can function on less energy.
Peak Oil will soon be unable to be ignored by the media due to high energy prices and the first reports of shortages. But for now, this is an emergency, and it is being treated as a concern. We can't wait until the federal government "gets it"; we have to approach this as a local emergency-preparedness issue.
Our county and city leaders should develop contingency plans. What do we do when oil is two or three times as expensive, or when we have serious shortages? How about creating an Energy Transition Task Force, made up of citizens, nonprofit energy groups, business leaders, local government officials and regional energy experts? That is what Portland, Ore., and many towns and counties are doing already.
Although we should have started planning 20 years before oil peaked to avoid disruptions to our economy (according to the Hirsch report for the U.S. Dept. of Energy), we are where we are and we have to start immediately. The citizen volunteers of APPLE would happily arrange for experts to meet with city and county officials to get this process moving.
Obviously, conservation of electricity, oil and natural gas will play a huge role in any successful energy-transition plan. People are gradually changing their habits - just not fast enough, given the energy crisis that is looming.
Using fossil fuels gives each American the equivalent muscle power of 300 people working for us, 24 hours a day: doing our laundry; heating our homes; fertilizing, harvesting and trucking our food; lighting our hospitals; moving our cars.
What will it be like for all us to lose half of this essential work force, the energy at the foundation of our daily lives? It seems we'll all find out in the coming decade.
ooo
Tem Tarriktar is a local business owner and board member of the Alliance for a Post-Petroleum Local Economy (APPLE of Nevada County). He can be reached at info@apple-nc.org.
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