Peak Oil?

[BrightNoon]

According to most analyses, from within and without the petroleum Industry, the world supply of oil, relative consumption, will effectively peak in the next decade. What does this mean? If demand exceeds supply, someone will neccessarily have to go without. The issue is who? Some nations will be priced out, most likely the relatively undeveloped countries in which automotive transportation is not really essential. However, when there is not enough oil to satisfy even the industrialized nations, which totally depend on oil not only for transportation, but for farming, various chemicals industries, etc., how will they likely respond? Obviously, war is a possiblity; they have been fought for far less in the past. Of course, access to petroleum itelf is not the only issue. Most of the world's food is grown using modern farming methods that require enormous amounts of gas. If the amount of surplus food suddenly decreases as a result of peak oil, the poor around the world will starve, lamentable in itself, causing instabilities that could lead to conflict over scarce resoures.

China comes to mind. The economy of that nation is being built, with questionable logic by the central planners, on the western model: i.e. dependent on cheap petroleum. What is unique about China is that the ruling party's legitmacy is intimately assosciated with rapid economic progress. If this were suddenly to halt or risk collapse, would that ruling party push the country into war, either to acquire access to oil or simply as a distraction, as so many authoritarian regimes have done in the past?

There is shift of power occuring in Asia, as China and Russia exert their influence. The Shangai Cooperation Organization of which they, along with Ian, Pakistan and most of the former Soviet republics, are memebers, has stated that it intends to remove U.S. influence from the region and failitate the rise of a 'multi-polar world.' I don't want to guess their specific motives, but it seems to me that such an arrangement could be very advanategous for those nations in the event of a crisis brought on by peak oil. Between Russia and Iran, they would have access to enormous oil reserves, from which they could, if supplies were too short, deny the U.S. Saudi Arabia comes to mind as well. As anyone who has done even the most superficial research on that nation would know, the House of Saud is a joke, a paper tiger and a tyranny hated by most of its people. If elections were held their, or if there was a struggle for power, the regime that woudl arise would be friendly with Iran and extremely antagonistic to the U.S.: quite understandably I might add. With the largest oil reserves in the world, it is vital that the U.S. maintain contorl over Saudi Arabia, which means propping up the House of Saud, and it would be equally benificial to Iran or to China and its partners in Asia to facilitate a revolution there, which would allow them greater access by default.

And so, after all that, which you might justly consider paranoia, my question is basically this; in light of the threat of peak oil, and of the general decline in American economic might relative the rest of the world (not to mention the current U.S. crisis), what do think the world will look like in a decade or two? If American hegemony fails, as appears inevitable, what will be its replacement?

[Khethil]

Nice post and important issue.

I really, really hope that alternative sources are being as enthusiastically-pursued as the urgency of the situation dictates they should. But the first, perhaps facetious, response I had to "what would happen"-question was to recall the 80's movies: Mad Max, and Mad Mad: Road Warrior

I'll admit though: There's a part of me that wants to see all this fossil-fuel B.S. come tumbling down. Even if it set transportation, technology and civilization in general back some, I'd think a "reboot in a better direction" (read: away from finite resources, fossil fuels) is so much the better.

Yea, more war over oil resources is likely; perhaps even inevitable.

Good topic, thanks.

[sarek]

There is no question that the coming century will see a confluence and will be a critical turning point in human history. Peak oil will be one of the primary drivers of this process.
We may very well be called upon to choose between collective life and death.
The potential is there for both. If we so choose to do so the technology we will have available in the near term future is perfectly capable of salvaging the situation.

But if we don't and we allow our technological civilisation to collapse under its own weight, the next generations of humans will have to do without the major stepping stone of an oil based economy. There simply will not be enough oil left. They may not be able to kickstart their own industrial era.

[Theaetetus]

I think what you are going to see is a shift towards localized economies. As the oil supply becomes smaller and population grows there just will not be enough to feed the system. Hopefully, people realize that it is going to take oil to move beyond oil, so the focus should be using what is readily available wisely, before the shift becomes extremely expensive.

[sarek]

I am not entirely without hope. Some small shift beyond the oil economy is already occurring. Don't forget the human species is capable of rapid adaptation.
And especially countries like the US have shown they can adapt real quickly if they have too. We saw evidence of that adaptability in the days of the new deal and again in the rapid transition from peacetime to wartime economy in the years 1917-1918 and 1941-1945. While some of the worlds wealth may be redistributed to other parts of the world the US is still the leading technology driver. That power can also drive a rapid change away from oil.

[jgweed]

We can safely assume that the amount of petroleum is finite even though we can assume also that new discoveries of addition sources and improved extraction methods may extend the life of oil-based technologies, and that our needs will eventually absorb the resource.
We cannot precisely predict when the crises will occur, but we understand its inevitability. This crisis will be a global problem and will be resolved globally. We can, however, begin at once to reduce our usage of oil and oil products, invest in the development of alternative sources of energy and move ever more towards their use, and fund both technological and scientific innovations.

[BrightNoon]

It seems like we're all pretty much in agreement; the current global order cannot be survive, unless there are extremely rapid deployments of renewable energy technologies. If we will be presented with a choice between collectivization on a global scale or death, I must admit, I choose death: i.e. mad max style chaos. In any case, I wanted to bring up an analogy, often misused, but that I think is relavant here.

There widely differing opinions about the causes of the collapse of the Roman Empire, but the general consensus is that the Roman military system became unsustainable and was replaced with a mercenary system because an economic collapse, beginning around the reign of Septimius Severus. Now, here is the part relevant to all of us. This economic collapse was basically the result of the unfortnuate Roman habit of importing huge quantities of very expensive, luxery goods from Asia, which were paid for in hard currency. The Mediterranean's old mines were unable to keep up with the losses, resulting in a profound debasement of the currency and in masive inflation. Quite a few of the Emperor's in the later period tried and failed to enforce strict price controls in response. The basic problem, with differences is detail, was the same as that faced by the United States today; we have a masive and growing trade deficit, resulting from our import of cheap manufactures and oil. We don't have hard currency, so this money can be replaced physcially, but we are similiarly being hollowed out, because of the government policy of constantly encouraging spending, much of which leaves the country via those imports.

Anyhow, I couldn't reists bringing this up, cliche as it is.

[sarek]

There's more to it I am afraid. If we can fix the peak oil problem technology and its survival-of-the-fittest driven abuse will simply lead us to the next crisis.
A worldwide change of attitude is what we really need to survive as humanity.

[incubusman8]

Originally Posted by BrightNoon

According to most analyses, from within and without the petroleum Industry, the world supply of oil, relative consumption, will effectively peak in the next decade. What does this mean? If demand exceeds supply, someone will neccessarily have to go without. The issue is who?

The issue isn't who goes without. The issue is the consequences for mass society once it is depleted., which it will soon enough. The reason is simple and unavoidable. There is an insatiable and unlimited amount of demand, and a finite amount of supply. Even if large petroleum reserves can be located (the chances of which are incredibly small, because all other reserves in the world were depleted in the 20th century). Right now, the western world (and the eastern world by consequence) is dependant on incredibly unstable and dangerous parts of the world to provide them with the single most important resource to our society and our economy.

As you would have witnessed recently and should understand, what happens to America economically will send shockwaves throughout the world economies and vice versa.

Here is the problem. Without oil, our huge populations would pummel into the ground. As I understand, that's not necessarily such a bad thing, in view of the various other problems attached to the size of our society. Estimations I've encountered say that world population could drop to one billion. My personal opinion is that is a fairly optimistic estimation.

So, even if we could get our hands on middle eastern oil, cheap, hassle free, the fact of the matter is, that it is a non renewable source and because of our unlimited demand, it will run out at some point. Within the following decade of date x (the date it runs out) some very serious problems will develop for mass society. Oil doesn't just fuel our cars. It operates machinery in factories. It operates farming machines. Starvation is the consequence. So, the switch to green energy has to happen anyway, independant of any Global Warming crisis (which I personally believe is a far bigger problem than this)

Originally Posted by BrightNoon

Some nations will be priced out, most likely the relatively undeveloped countries in which automotive transportation is not really essential.

Yes, for many communities around the world, they have learnt to live without oil (or posisbly never learnt to live with it aha). But these people represent a small percentage. I say congratulations to them. The masses, the millions are who are going to perish.

Originally Posted by BrightNoon

However, when there is not enough oil to satisfy even the industrialized nations, which totally depend on oil not only for transportation, but for farming, various chemicals industries, etc., how will they likely respond? Obviously, war is a possiblity; they have been fought for far less in the past.

War? Well, we've all seen that behind every war in history, the underlying reason is 95% of the time economic. But what is to be gained from war here? If country A has no petroleum, then going to war with country B, who also has no petroleum is senseless. Besides, war costs lots of money and consumes plenty of petroleum.

The real result is breakdown of centralised government. People get angry and become anarchists. This is a much more likely result.

Originally Posted by BrightNoon

Of course, access to petroleum itelf is not the only issue. Most of the world's food is grown using modern farming methods that require enormous amounts of gas. If the amount of surplus food suddenly decreases as a result of peak oil, the poor around the world will starve, lamentable in itself, causing instabilities that could lead to conflict over scarce resoures.

Oh yeah. Hit the nail right on the head man. Initially the poor would suffer the worst, but soon enough they're all the same starving degenerates. It doesn't matter really how much money you have in the bank account soon enough.

Originally Posted by BrightNoon

China comes to mind. The economy of that nation is being built, with questionable logic by the central planners, on the western model: i.e. dependent on cheap petroleum. What is unique about China is that the ruling party's legitmacy is intimately assosciated with rapid economic progress. If this were suddenly to halt or risk collapse, would that ruling party push the country into war, either to acquire access to oil or simply as a distraction, as so many authoritarian regimes have done in the past?

Japan comes to mind. Exact same scenario. The result was fairly explosive.

Originally Posted by BrightNoon

And so, after all that, which you might justly consider paranoia, my question is basically this; in light of the threat of peak oil, and of the general decline in American economic might relative the rest of the world (not to mention the current U.S. crisis), what do think the world will look like in a decade or two? If American hegemony fails, as appears inevitable, what will be its replacement?

[BrightNoon]

Originally Posted by incubusman8

War? Well, we've all seen that behind every war in history, the underlying reason is 95% of the time economic. But what is to be gained from war here? If country A has no petroleum, then going to war with country B, who also has no petroleum is senseless. Besides, war costs lots of money and consumes plenty of petroleum…The real result is breakdown of centralised government. People get angry and become anarchists. This is a much more likely result…Oh yeah. Hit the nail right on the head man. Initially the poor would suffer the worst, but soon enough they're all the same starving degenerates. It doesn't matter really how much money you have in the bank account soon enough.

As you say yourself and illustrate with the example of Japan, wars are often and perhaps almost entirely fought over scarce resources, directly or indirectly. The idea is not for non-oil producing country A to attack non-oil producing country B to siphon its gas tanks; obviously the issue would be control over a third party that does export oil. Saudi Arabia is a prime example. Currently the House of Saud is sustained by the U.S. via hard and soft power. If that power should wane even temporarily, in a forced withdrawal of troops from Gulf bases due to an epic monetary crisis for example, there would be revolution of the Iranian sort: no doubt assisted by Iran. Following something like that, China could very easily assert its influence through Iran and become the new master and best customer of Saudi Arabia, cutting out the U.S. from a huge proportion of the world’s oil. As far as war being expensive, when has that ever discouraged anyone?

I’m sure anarchists/protestors/rioters/looters would multiply in such circumstances, but that seems to me to make foreign adventures even more likely, especially in countries that will not be simultaneously experiencing hyperinflation and therefore be unable to supply large forces abroad (hmm..). There will always be some food and some amount of money (stuff if not paper currencies) that will be able to buy that food. Almost everyone might be starving, but not everyone.

Altogether, I think we’re basically in agreement. Maybe you expect (hope?) that anarchy will be such that external war becomes impossible, while I think that will only be the case in the declining powers: i.e. the west. I expect East Asia and perhaps a few other regions to become much more influential in the coming decade or so, probably through war or at least the threat of war: i.e. bullying crippled, debt ridden, “undeveloping”, western nations.