The discussion about this article over at iTulip.com took a very different direction than it did here. Interesting how different but similar communities react differently do things.
I’d appreciate knowing whether anyone here had a strong reaction to reading “Although there’s more than 100 years’ supply of crude oil left in the ground…” at the beginning of the article. That statement is irrefutably correct, but not terribly relevant since what counts is what can be economically extracted. But for some reason quite a few iTulipers who are firm believers in peak oil took offense to that statement. Interestingly, I included that comment in an effort to appease a different bias group - those people who insist peak oil isn’t a problem because there is still plenty of oil in the ground, but who don’t seem to stop and think about the fact it doesn’t matter what’s in the ground if you can’t get it out.
To my surprise, several of the iTulipers were so offended by this statement that they either didn’t read the rest of the article at all, or completely misinterpreted its content. I’m curious whether anyone here took objection to reading those words, and if so, do you feel that reaction biased your openness to the rest of the article?
It sounds like a case of letting emotion get in the way of logic.Some folks are so paranoid that anyone may try to debunk the peak oil argument they don’t even read/comprehend the text of the discussion. No doubt (in my mind anyway) we now have or will soon have peak oil but that does not mean that oil will be completely non-existent. Clearly, there will be oil in the ground long after we are dead and gone.
I did not see anything in your paper that should evoke such a response.
Well, no, I took no notice of it at all because on one level it’s entirely true and I knew that was the way you meant it to be read. In fact there will always be oil left in the ground.
But I could see how some might exception at the word “supply” if they interpreted that was being used as a synonymous concept for “sufficient quantities to maintain our current living standards and economic trajectory for 100 years” or even “.…100 years at current rates of consumption” because neither is true. So I think the word “supply” could have benefitted from further definition.
A reworded sentence might read “The crude oil left in the ground could be pumped for another 100 years, although at steadily declining flow rates the entire time…”
Peak Oil, for me, is about flow rates and net energy (EROEI) and the fact that our money system and economic model require continuous expansion. That’s the whole story in a nutshell.
The exact date of the peak and how many years we could theortically pump until we hit EROEI unity are debates I am more than happy to leave to others because the answer to either will not change a single thing about which actions I will take.
I didn’t think much of it since CM has really harped on the fact that what matters is how many barrels it takes to get 1 barrel. iTulipers may not have a CM sage.
Not offended at all. Was somewhat offended by your politics/Cheney comments. Although I’ve learned to compartmentalize that kind of “noise” and not let it interfere with my absorption of the real subject matter at hand, I humbly suggest you de-personalize that type of thing in the future, unless you are not concerned with not reaching that segment of the population that will automatically shut-off once they read that kind of message. You could have just as easilly made the comparisons to the rise of the Nazi party without bringing Cheney into it. By doing otherwise, certain people’s “breaker-switches” will go off, and the rest of your message will be lost on them.
PS: I do NOT want to start a discussion on whether Cheney is/is not ______________ (fill in the blank), so before anyone replies with their laundry list of Cheney’s and/or Bush’s crimes, let me just say my point is that dipping even a toe into politics (at least in the manner in which it was done) detracts from the purpose of Eric’s post, as any laundry list replies to this post would in themselves prove.
This raises some very important, key, human issues. We (the community of individuals who have glimpsed the tremendous implications of current events and depletion of cheap energy sources) face a very real challenge. The challenge is not, “How can I make some money off of this situation?” And it isn’t, “How can I and my family survive when things collapse?” Being morally prepared for what’s coming means being completely honest with ourselves about who we are, what our weaknesses are and how we deal with unimagineable stress. How compassionate are we? How able are we to “endure” rather than “join the fight?” These qualities are not built just by educating, or informing, ourselves about what’s coming.
I live on a 126 acre farm in the mountains of BC with a seasonal creek plenty of room to garden. My wife and I choose this for ourselves and we’ve spent most of our lives developing and managing retreat and meditation centers. I have a 20 year meditation practice, and still I probably won’t really know what the fruits of that practice have been until I’m faced with the reality of what’s coming. One thing I know for sure is that survival instinct and habits are far, far stronger than my strongest idea, vision or understanding. Being aware that radical change is coming does not alter who we are, fundamentally. So, the challenge I see before us, the work I endeavor to do, involves building new habits and managing the mind.
I feel that Chris’s gentle and balanced approach to this topic is what has inspired so many to follow along, but every one of us has serious inner work to do (in addition to the outer preparation) in order to be the “arks” “beacons” “islands of sanity” “sanctuaries” etc, that we hope to be as things shift. No one can do that work for us. It is not just information that we need.
I agree with that statement. I was mentally formulating a question about it when your poll came up on the radar. Here is the question:
In mining, engineers use an economic shell to determine the reserves which are considered viable. If engineers and geologists were to estimate the quantity of ALL mineral reserves regardless of cost or price then the quanitity is astronomically greater than using a reasonable cost/price projection. This is the way it works in coal and oilsands. Although I am not a petroleum engineer, I assume a similar method is used in conventional oil extraction.
So, my question is what oil price is the “more than 100 years’ supply of crude oil” estimate based on. And, would this reserve quantity be greatly reduced if the govt were to intervene with price controls at say $150/bbl vs $500/bbl?
In mining, there is another dilemna. After the mineral is extracted to the physical limits of that economic shell, the mine personnel will backfill the pit to restore the original topography. I assume that when the price goes up in conventional oil drilling that you would fire up idled wells and develop more wells in areas where recovery is more expensive. However, in mining, because of backfilling, it is VERY expensive and the low cost reserves arent available to offset the higher cost. So, will this reduce the 100 year estimate further?
Whether you answer or not, thanks for the time you are putting into this, Erik. I know it asks a lot of you.
It seems like the latest tragedy in the Gulf of Mexico is an excellent example of diminishing EROEI. As we pushed the limits of our technology to reach oil at greater depths and pressures, we came up with a situation that we have never (exactly) dealt with before. No one knows how long it will take to fix and no matter who ends up “paying” for it, no one has any idea how costly this episode will become.
Buckaroojim and Farmer Brown, both your comments are excellent. We came to this impasse through our collective fault and negligence and our collective effort (and personal strength) is the only ticket through this. That said, we need to be a lot more honest with ourselves and our “leaders” and demand dramatic change from both.
Erik I agree completely. The government will not simply stand by and watch this. They will intervene, blame speculators, hoarders (i.e. those prudent enough to see into the future), slap on price controls, nationalize, and institute rationing.
If the events of the past few years has taught us anything, its that the government will intervene any time, anywhere, any place things are not working out the way they want it to, period. Rules get changed on the fly - the system feels quite free to reverse course 180 degrees when it suits them. Notice that the ECB is now accepting “junk” for collateral when just a few months ago they explicitly ruled it out.
One might consider service companies as good investments, since they will be required to extract the last little bit out of all the old oil fields, and keeping up with the latest technological improvements and methods will be even more valuable.
Interesting and thought provoking analysis (thank you), followed by depressing conclusions and advice for action!
Given the enormity of the problem - potentially civilisation ending, is the best we can do with the information really to plot ‘investment strategies’ to maximise our personal take from the information. And with the economic dislocation that is likely to result what are we going to spend the profits on?
The rationale for predicting ‘government intervention’ including potentially price controls and rationing seem sound. If the analysis is right what would be the best form for that intervention to take (to protect the best of our present civilisation not to increase our personal profit from the disaster)? Anyone looked recently at David Fleming’s Tradable Energy Quotas (TEQs) model (http://en.wikipedia.org/wiki/Tradable_Energy_Quotas).
Although peak oil was not, I think, his primary motivation for devising this system I don’t see why it is not a highly appropriate government response to this analysis. UK government looked at this a couple of years ago and concluded that it was technically doable, just not politically doable. You might just have identified the circumstances that will make it politically doable as well.
Good read I guess, although I’m surprised that anyone would find any of this particularly “eye opening” or controversial. Given our ongoing military involvement in the middle east, which has been ever so thinly disguised as a “War on Terror,” I assumed that everyone just presumed a potential government takeover of essential energy markets to be a given.
The comments I found troubling were the investment advice to speculators regarding market timing, etc. I know this is at least loosely an investment site, but such rampant speculation on basic commodities has played at least a small part in our current fix, and will no doubt be the main reason for any prospective government takeover in the future. Given the choice of handing a future windfall to a corrupt and dying government that I despise (and indirectly to powerful operators operating within it) or a few well-heeled and well-positioned speculators, I must confess, I’ll still choose the former.
Having just finished the crash course earlier today, I find it hard to rationalize such opportunistic thinking with the monumental challenges we have before us. Believe me, when the current cheap energy, debt based economy goes tits up, there will simply be no place to hide.
Believe me, when the current cheap energy, debt based economy goes tits up, there will simply be no place to hide.
That pretty much sums it up. There really is no place to hide in a world of converging calamities, i.e the power-down crunch, the resultant mass migrations from climate change and environmental degradation, resource wars, future pandemics. I like the following quote from Theodore Roosevelt who had America pegged way back then:
"The things that will destroy America are prosperity-at-any-price, peace-at-any-price, safety-first instead of duty-first, the love of soft living, and the get-rich-quick theory of life."
This is a well thought and rational article but given that the western banking oligarchy has already successfully manipulated the price of oil I cannot necessarily agree with some of the assumptions this article makes. Mr.Townsend presumes that governments will have power over their natural resources in a way that is consistent with what I would call 20th century thinking. Times have already changed and we will see in the next year or so if the banking oligarchy prevails or entirely subverts government action of any kind in this regard. In my view it is clear that the banksters in collusion with politicians in most western countries have systems in place which are effectively draining the citizens of their wealth. Who is to say that they will not control the price of oil when perhaps they already do? Instead of thinking in 20th century business terms- banks, speculators, governments, price controls, etc., consider that most of if not all of the large western banks are effectively international criminal enterprises in collusion with politicians for the sake of enriching themselves. Most of the smaller European countries are already at the mercy of these institutions and who is to say that this trend will not continue and morph into something more hideous? If the banksters are able to consolidate their hold over the global commodities markets what governments (that they don’t already effectively sway) would be able to stand against them? My overall feeling is that what happens with regard to oil prices in the future is deeply unpredictable beyond a year or two.
Welcome to PeakProsperity.com. The economy was in recession officially the end of 2007 while oil prices did not peak until summer of 2008, so $147 per barrel oil was not the first match lit.
Nope, no problem with that “catch phrase” there… I correctly guessed it was to try to bring in the uneducated, but I suppose we may have uneducated people in the “peak oil camp” as well Aaah, what a mess…
That statement took me back when I first read your post, but I thought I saw the point you were trying to make and moved on. Here is my take on this. Your wording was not precise and unwittingly lead to an inaccurate, and thus misleading conclusion. I do not think it is “irrefutably correct”. Here is why.
In theory, at Hubbert’s peak half of the oil has been used. Since we have used significant quantities of oil for over 100 years, I can see why you thought you could say we have a 100 year supply left. But this ignores the exponential increase in consumption we experienced. Your statement is correct only if we reduce our consumption at the same rate it grew in the last 100 years. That is not what you said.
Your statement also ignores the projected growth in consumption. It implies that growth can be physically met by the 100 year supply.
In writing for the public it is crucial to remember that people perceive things in different ways. In addition, they often scan hurriedly without much thought and jump to conclusions. They interpret thing to their advantage or to fit their beliefs. Men and women respond differently to the same words. Precision of wording is difficult, but it is important to try to eliminate ambiguity so you can minimize misinterpretation.
This was the only clangor I saw in the whole article. Your analysis was very tight and showed original thinking. For a serious piece of writing it is helpful to have other people proof read it. Ideally at least one person is familier with the subject, another is not, and at least one is of the opposite sex.
I hope you are not discouraged by this Erik. We learn by doing. You have all the skills, you just need a little more experience at this to learn how to avoid a few pitfalls. You article was an impressive job and we could all benefit from more of them.
I felt no emotion at all reading this. Perhaps because the implications were not clear until you all started discussing it. To me it doesn’t matter how much oil is under the ground, only what we can get out in a reasonable way as Chris has pointed out in the CC (EROEI, etc…).
Aaah, what a mess…