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These oil wells were thick as fleas along the Texas coast in 1978, when America was awash in oil. But production has been declining since 1970, and simple-minded hype will not change that. (Photo by Roger Wollstad (Roger4336)/Flickr)
If you don’t believe in arithmetic — if your political or religious tenets require you to deny that 2 + 2 always equals 4 — then by all means stop right here and go read something by Glenn Beck. For the remaining minority, then, of people clinging to outmoded faiths in things like gravity and mathematical truth, here’s the headline: we are running short of oil. There is no renaissance, no triumph of technology, no sudden reversal of the rules of the universe. And it is still true that running short is almost as bad as running out.
If your information about our petroleum prospects comes from TV, it came from the oil industry. Increasingly, however, other sources, both in government and private industry, are getting severe heartburn about the fraud the oil industry is maintaining. Some recent examples:
- An analysis by the global banking and insurance behemoth Citigroup (reported by Bloomberg) finds that Saudi Arabia may be unable to export any oil by 2030. If the little hairs on the back of your neck did not stand up when you read that, read it again. It says that by the time today’s infant is a senior in high school, ten per cent of this country’s oil supply will be offline. Permanently. And this Citigroup analysis does not assume any decline in Saudi production, which is highly likely. It simply observes that the skyrocketing demands of the Saudi population will by 2030 be consuming all the oil it can produce. Factor in the likely decline in production (as Oilprice.com has done) and the spigot gets turned off in 2022.
- Another mathematics-based investment bank, Barclay’s, has looked at the net effect of the much-hyped oil and natural gas “boom” in the United States and estimates it to be, on a scale of one to ten, about zero. Barclay’s also looked at the prospects for energy independence as trumpeted by the Romney campaign and has estimated the likelihood at — zero. (Glenn Beck take note: wasn’t zero invented by Arabs? Should Christians believe in it?)
- According to a climate research center in Norway, the Arctic, even if it is to be ice-free quite soon, will not be the last best hope for continued oil gluttony. Because of difficult conditions and prohibitively high production costs. Arctic oil’s impact on the global market through 2050 — about zero.
- Reports out this week from the US Geological Survey and the Society of Petroleum Engineers use arithmetic to estimate the amount of recoverable natural gas and oil that can be taken from the shale formations being credited with a new petroleum renaissance in America. You can work through all the numbers in reports done for Energy Policy Forum here and here, but the general idea: the amount of oil we can realistically expect to see from these bonanzas is in the area of one-fourth, as in 25 per cent, of the amounts being touted by the oil and gas industries and their subsidiary, Mitt Romney Inc.
- When Romney promises energy independence, he sometimes remembers to qualify it as “North American energy independence,” because of course the idea of the United States achieving energy independence is so ridiculous that even he….oh, never mind. Anyway, the rosy picture requires Mexico, our third largest supplier of oil, to hang in there. But according to CNN Money last month, Mexico’s oil production peaked in 2008, has fallen below three million barrels per day, and continues to fall fast. As a result, the US will soon have to depend even more on its number two supplier, Saudi Arabia. See above.
Logic and mathematics tell us that the end of cheap and plentiful oil, now clearly in sight, will be among the most traumatic events in human history. Only a fossil fool would ignore it.
Tom – delightfully succinct, as ever.
For all that the strategists of big fossil can be expected to run the con-game till the last possible day, and then some,
(for without confidence in their ability to supply fuel there goes their share price, plus the rest of the market, and not a slump but an economic black-out then guts all further fossil resource development, thereby making the day confidence is lost into that last possible day) –
they are actually in a double bind.
Yes they can buy back shares, buy islands or bunkers with their bonuses, etc,
but the critical shift of investment and development in the future US-based energy industries is largely blocked for them. Not by law or PR or poverty but by the needs of the bipartisan US climate policy of a ‘brinkmanship of inaction’ with China,
which awaits the climatic destabilization of China’s govt. via rising food price unrest, as the one non-military means of deflecting China’s rise to global economic dominance. (I guess it doesn’t need saying that maintaining US global dominance has been the paramount priority since WW2 ?).
When Obama signalled to other countries his adoption of Cheyney’s climate policy in March 2009, it was by adopting the unilateral US 2005 CO2 baseline and thus reneging on the UNFCCC 1990 baseline – which was simply invisible to 99.8% of Americans. Yet to advance the brinkmanship of inaction – which he’s done relentlessly – after promising to slow the rise of the oceans etc, required a special kind of cover. He needed the charade of an opposition to climate action so vocal that it could plausibly be blamed for tying his hands. Gagging him even.
It took several months for the GOP to turn round and get the raucous circus of denial up and running, as well as some chickenfeed funding and training of some talented shills, but they managed it. What percentage of Americans go anywhere near connecting the dots of that fabricated circus of denial and Obama’s actual conduct on climate ?
It’s not as if more than 1% read Lizza’s article on the derailing of the senate bill, while far less than that have a clue just how the Copenhagen ‘deal’ was calculated to insult. Africans starving because of world food price escalation worsened by Obama’s raised ethanol mandate ? Says who ?
By capturing the attention of activists, scientists, journalists and others from even questioning whose to blame for inaction on climate, the circus has really functioned pretty well, don’t you think ?
And the bind facing the fossil industry ? They simply cannot go ahead and match their Chinese, German, Japanese and other counterparts $ for $ in the new energy investments – without utterly blowing the veil that allows Obama to pursue that bipartisan policy of a brinkmanship of inaction. And without putting down China, what prospects would the US fossil lobby have anyway ?
Tangled webs, even by deceivers of long experience . . . Ironic eh ?
All the best, and many thanks for your exemplary dogged perseverance,
Lewis
Well said, and thank you. But how did you know I have a dog?
Tom – I’m of the view that most wise men have at least one dog for a friend – as a constant reminder of how what matters in life is more outdoors than in –
but I fear I’ve strayed from the path of wisdom by cohabiting with a pack of five of the red dogs of Wales’ Cambrian mountains. Being the pack’s butler as well as its companion has its drawbacks.
All the best,
Lewis
Dog! Who mentioned dogs? ;-)
Seriously, as Lewis said, succinct (and powerful). Would you grant me permission to republish large chunks of your post on Learning from Dogs? Plus, do you have a link to that Barclays’ report?
Thanks, Paul
Feel free to quote, as long as you link. I have found no link to the Barclay’s report, I suspect it is available only to those who pay. There are tons of reports on the report, however, just ask Mr. Google.
When our ways of thinking are so skewed we refuse to face what the numbers tell us, then our days are indeed numbered.