Filling up the Prius at the Safeway gas station in Arvada, Colorado, still costs me less than thirty dollars. The family owns two of these hybrids and an 80 mile per gallon scooter for getting around. Peak oil and overpopulation have been on my mind for the past ten years and we have planned and made decisions accordingly.
Nevertheless, I haven't posted in a few days because I have been mentally and emotionally digesting a look again at University of Colorado professor Dr. Albert Bartlett's lecture on exponential growth, population and energy. In light of recent economic developments, Bartlett's talk takes on new immediacy -- that is -- the end IS near.
Please look at the "Most Important Video You'll Ever See" below ... make sure and take a little time and view the continuing parts on YouTube. Our destiny is all there.
However, in this post I've included some other important links, news, graphs and articles. They are all corroborating evidence and analysis for the fact that there are too many people making too many demands for the Earth's resources -- a breaking point has or will soon occur.
The tragic part of this is that we've know about this problem for years now ... but we (the human species as a whole) have done almost nothing to mitigate the coming disaster. It is now too late. Though it is unfashionable, even considered impolite by some to speak plainly of our dismal future, I will certainly not indulge in 'feel good' optimism for the sake of causing anyone to remain in their state of comfortable denial.
The truth is that world population is now estimated at over 6.7 billion people, the U.S. at over 300 million -- and everyone of us wants/needs food, shelter and clothing. Shortages are occurring in the resources that provide basic necessities ... check the first link ... and we all have heard by now about insufficiency of grain supplies around the globe.
But it is oil that makes the modern world go 'round. You may have plenty of rice in Brazil but if you cannot reasonably afford to ship it to Baton Rouge because the cost of a gallon of diesel fuel is skyrocketing, then there are going to be shortages of supplies where they are needed or shortages of ability to pay.
I still believe that 'knowledge is power' which is the great value in reading and viewing the information imparted here. You will know what is really going on and what is about to happen -- your ability to make wise decisions is therefore greatly enhanced.
Whether a giant crash suddenly plunges us into the abyss or we slide slowly into the post carbon energy world, the important lesson we can take away from the Bartlett lecture and the other items posted here is that it is happening ... now.
Link: Energy Shortage Web Site
Link: The Price of a Barrel of Petroleum - Around the World
Link: Reality | Mark A. Goldman/Information Clearing House
These are interesting times. With oil trading above $100/barrel, a larger portion of our national wealth is being spent on the cost of energy.
We are very near or already at what geologists call peak oil. Peak oil is the point at which the maximum rate that oil can be extracted from the earth’s crust can only relentlessly decline from that point forward, due to geological and technological realities. Prior to peak oil it was usually possible to extract as much oil as we needed to meet growing demand while keeping prices relatively low. After peak oil it will be impossible to do that. From now on, oil will become increasingly scarce. The black gold will still be allocated according to price, but as supplies dwindle and prices increase, more and more people will become less affluent, i.e., poorer than they used to be. The age of cheap energy is over. Unfortunately, soon this will be true for all non-renewable resources as well.
This means that our economy, which runs on oil, will not be able to sustain past levels of growth indefinitely, if at all. Pundits on TV are discussing how long it’s going to take before the current recession will turn around and we come out the other side ready for the next round of growth. In my view, this recession is not going to end any time soon and without appropriate leadership it might not end in our lifetimes. The result might easily look like an economy in the middle of a very long slow motion train wreck.
If this sounds like a dire prediction, it doesn't have to be... but it very well might be. Americans, in general, seem averse to contemplating reality. Up until now it’s been easy to get away with it, for as long as energy was cheap we were all free to pursue personal interests and put most everything else out of our minds. But soon reality is going to confront us at every turn. For some, it's already happening.
For example, without cheap oil our food supply will begin to contract. American corporate agriculture runs on oil. It takes oil to prepare the earth, it takes oil to fertilize the fields, it takes oil to harvest the crops, it takes oil to kill the bugs, it takes oil to ship the produce, it takes oil to keep things cold, and it takes oil to cook our food. Meanwhile, bees are dying, bats are dying, while our oceans are being over-fished, polluted with non-biodegradable plastics, and poisoned with PCBs and other chemicals.
Now consider, the cost of fuel is not going to go down except for short-term market fluctuations. Producing energy efficient cars will help, but our oil based, combustion engine based economy, is coming to a close. Replacement technologies are not in place and it takes time to build infrastructure. The longer we delay the development of enlightened energy and transportation strategies, the longer and deeper economic dislocations will be.
A lot of people don’t have much money now and they have less credit and are less credit worthy than they used to be. We are the only industrialized nation with a zero to negative savings rate. Very few industries do not in some way depend on energy and at the same time nearly every corporation in America is committed to growing their profits at double-digit rates. There is not going to be double-digit growth in America. If significant growth occurs it will probably take place in emerging markets but only to the extent that energy allows. In the US, where citizens, government, and corporate executives are somewhat delusional, without society reinventing itself, the economy will decline or stagnate. You can argue these points with me, and I'm always open to it, but in the end, reality will settle the argument.
As corporate executives confront this reality, one can only imagine what kinds of strategies they will use to try to insure their double-digit goals. Their strategies have been evolving for a long time. Look how much effort and money they expend corrupting government policy and officials with their teams of lawyers and lobbyists. Why do they do that? Because they don’t know how to earn double-digit growth legitimately. The only way they can do it is to dip into our pockets and extract our wealth through deceit, corruption and back door government collusion.
Peak oil has been kept a corporate and government secret since 1956. We could have been planning for it all along had not a cadre of corporate and government power brokers diverted our public wealth into their self serving strategies.
So now we have some very severe problems facing us. From government we get lies, secrecy, and obfuscation to prevent what citizens might do if we only understood how we’ve all been cheated.
Officials are not stupid or uninformed… They know and accept that we are in Iraq to control resources. They knew if they had told us what they were up to in the beginning, we wouldn’t have let them get away with defacing the Constitution, murdering a million people and injuring and displacing millions more to take control of the oil. They sugar coat and lie now about almost everything they do. No matter what the politicians tell you, we are not leaving Iraq, at least not until we are sure that we will have certain unfettered access to the oil… or until we have some enlightened leadership.
It’s important to understand this: If we approach these problems with anger, fear, and knee jerk responses, we will surely make things much worse. And yet for an awful lot of people, that will be the initial response to being confronted with, and being awakened by-- reality. The problems we face are solvable. Human beings are capable of great creativity, compassion, and sacrifice. But we can’t solve problems if we are afraid to talk about them, and we can’t manifest a creative environment for developing solutions if we are afraid to tell the truth. The truth about what? In this case, the truth about everything! It should be obvious by now, that you can’t lie about some things and expect that those lies will not eventually poison or corrupt most everything else. The health and well being of every human soul is in some way dependent, interconnected and related to ever other.
We can’t arrive at optimum solutions if we are so afraid to think for ourselves and examine our preconceived ideas and accepted myths. I don’t think we will be able to find meaningful solutions to the problems we face, unless the great majority of us become willing to change our interests, our habits, and our attitudes. This is not going to be easy.
At first, very few politicians, corporate executives, or religious leaders will look kindly on the prospect of examining the delusions and myths we grew up with. In fact they will probably go to any extreme to tell you what I’m saying is just a lot of nonsense. No one who has influence and power over others will want to give it up. But make no mistake… as Dr. Barlett1 says, the problems are all going to get solved… the only question is how painful is it going to be and will these problems get solved with any semblance of compassion, justice and fairness?
If we attempt to look out only for ourselves, we can be pretty sure that’s what others will do too. And if we do that, I can assure you, the suffering will be unprecedented. We are all members of one family. We need to remember that and realize that every one of us has a stake in finding viable solutions, where no one is left out, and where no one will be asked or be required to sacrifice their basic rights or dignity.
To U.S. readers ... this chart means that we have the furthest to fall and we will have the hardest landing.
Oil Production Per Capita -- We peaked years ago by this metric.
With greater energy demands coming from growing populations and economies in China and India,
the impact of this reality is enormous.
The Most IMPORTANT Video You'll Ever See
By Dr. Albert Bartlett
Click on the YouTube link to get to the next parts of this lecture.
Link: Is Oil Headed for $200? | Calgary Herald
Twenty short weeks ago, the world was struggling to digest the idea of $100 US oil.
Today, with oil prices breaching new records almost daily, even ordinarily circumspect soothsayers are talking about the prospect of a super price spike that could cause a run to $200 -- a concept that would have been virtually unthinkable 12 months ago.
And when some of the finest economic minds on the continent -- people like Daniel Yergin, Matthew Simmons and Jeff Rubin -- are willing to openly discuss the permutations and ramifications of life in the shadow of $200 oil, it's hard not to think that a scenario that was once a pipe dream may actually be on the horizon.
After a week in which oil prices set new records daily while passing through two so-called psychological barriers -- $120 and $125 -- before settling in at $125.96 Friday, it's easy to see why the oil bulls are running wild and the bears are nowhere to be found.
"Oil will go through $200 like a hot knife through butter," insisted Simmons, the chairman of investment bank Simmons and Co. International and one of the main champions of the controversial "peak oil" theory, which holds that virtually all of the significant oil pools we are likely to discover have already been found.
Rubin, the outspoken chief economist at CIBC World Markets, has gone so far as to predict oil prices will average $225 a barrel by 2012. Two weeks ago, when he made that call, there were more than a few sniggers around the investment community.
Nobody is laughing today. Since the start of 2008, the price of oil has jumped 25 per cent. Year over year, it has more than doubled.Not surprisingly given those statistics, oilpatch stocks were also on a tear all week, setting records of their own and pushing the TSX energy index to a year-to- date high of 3941.11 before falling back to end the week at 3922.55.
That oilpatch bellwethers like Canadian Natural Resources Ltd., EnCana Corp. and Suncor Energy Inc. have been rolling out record or near-record first-quarter earnings, and reports that show them to be awash in cash, has only helped fuel the buying frenzy.
Ditto for natural gas prices, up more than 50 per cent since the start of the year and threatening to revisit record highs of their own should summer demand reach anticipated levels. That's a scenario that would produce a so-called "perfect storm" for companies like Canadian Natural, which is heavily gas leveraged but has substantial oil interests and is poised to bring its Horizon oilsands project on stream this summer.
Even unprecedented gasoline pump prices across North America -- not to mention soaring jet fuel and diesel prices -- have been unable to put a damper on the Black Gold Rush of 2008.Nor, more importantly, have they yet caused consumers to dramatically change their behaviour.
At some point that will happen, insists Yergin, chairman of the prestigious Cambridge Energy Research Associates and one of the most respected energy analysts on the continent.
"Price really matters," Yergin told reporters last week. "It doesn't happen overnight but the laws of economics have not been abolished."
His point is well taken. But clearly, we haven't reached that point -- and hence the renewed conjecture about $200 oil.
Ironically, as OPEC secretary general Abdalla Salem El-Badiri reiterated again last week, there is no shortage of oil in the world.
Nor is there any reason for OPEC, which produces 40 per cent of the world's petroleum, to increase production levels, in spite of U.S. President George W. Bush's promise he will once again ask cartel members to up their output -- a silly political gambit that ignores OPEC's own repeated admissions that it can no longer move global markets or prices at will.
What there is, however, is a widespread fear that geopolitical instabilities could disrupt the flow of oil to consuming nations at any time.
Consider the evidence: Nigeria, the 11th largest oil producer in the world, is in a state of loose anarchy. Iraq, with the fourth-largest reserves in the world, is a war zone. Iran, third-largest reserves in the world, is a powder keg. Venezuela, second most important supplier to the United States after Canada, is at war with international oil companies.
Add in the unfettered consumption of oil by China, India and an emerging Middle East economic bloc, and it becomes apparent that the global dynamics of oil supply and demand are in the midst of an unprecedented restructuring.
As ARC Financial senior economist Peter Tertzakian likes to say, when it comes to oil consumption in the aforementioned countries, their leaders are not going to be able to put the genie back in the bottle.
In other words, don't expect a fall-off in the global demand for oil in the months and weeks ahead.
Ultimately, as Yergin argues, when oil prices get high enough, there will be a shift to alternative fuel sources.
But as we've also seen in recent weeks, global shortages in basic foodstuffs caused by the sudden reallocation of agricultural production to biofuels underscores the complications of any widespread move away from oil.
It also serves as a pointed reminder that any meaningful attempt to replace oil as a primary source of energy in the developed world will not happen overnight. In fact, most observers agree it will occur only after an entrenched period of high prices convinces investors that a new world energy (pecking) order must be established.
That equation has not gone unnoticed by global investment fund managers who, knowing a good bet when they see it and anxious to make up for the impact of the devaluation of the U.S. dollar on their portfolios over the past year, are one of the primary forces behind oil's meteoric rise to record heights.
Do all of those considerations pave the way for a run to $200 oil?
The jury is still out. But the betting is heavy that oil prices will almost certainly go markedly higher before they settle or, dare we say it, perhaps even fall back.© The Calgary Herald 2008
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