Peak fossil fuels = peak convenience

A thoughtful, short essay on the challenge to the American lifestyle as energy gets prohibitively expensive, from R-Squared:

However, many I know would never consider public transport. I know people who would circle the Walmart parking lot 10 times before they would walk from a parking spot that isn't within 50 feet of the front door. The only food they have ever known comes from the supermarket. These people scream the loudest for the government to do something about gas prices. These are also the people who I think will have the most difficult time adjusting to the new reality imposed by high oil prices. Some will sink ever further into debt as they wait in vain for the government to fix the problem.

Oil consumption mirrors economic growth

In a post on Peak Lite, Robert Rapier has an interesting chart showing how economic growth tends to be mirrored by an increase in per capita oil consumption. Makes you wonder what will happen in the coming years with $100 per barrel oil.

The oil update: plateau

The Energy Blog has a nice, short piece on what the oil pundits are calling "Peak Lite." A time period where world demand outstrips increasing supply (but before total supply peaks), this period (circa now) will last until the end of 2009 or so before supplies start falling and we really start paying for oil.

How bad will it be? Check out the right axis on this chart, showing projected world oil prices. We're currently at $76/barrel.

The GAO asks: are you ready for peak oil?

Robert at R-Squared Energy Blog analyzed the Government Accountability Office's new Peak Oil analysis and he has three major points:

1. Peak oil is coming soon, but it's not in the past and it's not imminent.
2. As far as energy prices go, it doesn't matter because supply isn't going to be able to get ahead of surging demand in developing countries like India and China.
3. The United States better take the GAO report seriously, because our economy is heavily dependent on oil.

Some excerpts of the report from the Energy Bulletin highlight the challenges ahead for the U.S.:

Key alternative technologies currently supply the equivalent of only about 1 percent of U.S. consumption of petroleum products, and DOE projects that even under optimistic scenarios, by 2015 these technologies could displace only the equivalent of 4 percent of projected U.S. annual consumption...

...Under these circumstances, an imminent peak and sharp decline in oil production could have severe consequences, including a worldwide recession...

...While the consequences of a peak would be felt globally, the United States, as the largest consumer of oil and one of the nations most heavily dependent on oil for transportation, may be particularly vulnerable...

The GAO has the full report online and the Energy Bulletin also has a lot of great charts from the report.

Peak Oil: Exhibit A

The folks studying peak oil issues at The Oil Drum have a fantastic chart posted regarding Saudi Arabia's oil production. Despite record high prices during the past two years and a history of helping to soften price spikes with increased production, Saudi oil production has fallen steadily.

It may be the "smoking gun" that the Saudis have reached their oil production peak - quite a concern given that they represent 1/8th of world supply.

Peak Oil is not "empty"

Exxon Mobil CEO Rex Tillerson was recently interviewed on CNBC and from the summary in the Wall Street Journal's energy blog, it's clear that people still do not get what "peak oil" means.

Peak oil is when worldwide annual production of oil reaches its historical high and then declines. It means that we'll go from producing 80 billion barrels in 2009 to 79.8 billion barrels in 2010 (hypothetically), and then a little less each year thereafter.

The reason peaking production is just as problematic as if we were running out of oil is that world demand continues to grow steadily each year, and when supplies start declining the price will increase rapidly. Think of it like you would Dave Matthews Band. Before they were popular (low demand), there would have been no problem getting concert tickets (high supply). However, as their popularity grew, demand for tickets quickly outstripped even the largest concert venues (demand caught up to supply). Now imagine what would happen to the price of DMB tickets if they had to perform in a smaller venue each time they had a concert.

So that's Peak Oil. Here's what it isn't:

Peak oil is NOT "no oil." We'll continue to produce lots of oil, just a little less each year than before.

Peak oil is NOT "no new oil fields." We'll continue to discover new oilfields as technology advances, but just never enough to replace all that we're pumping out.

Peak oil is NOT "no new technology." We'll continue to find ways to extract more oil from existing fields and oil from shale, tar sands, and other weird places. But even as these become more feasible, they will still not be enough to replace existing oil production.

This chart gives a sense of why we're hitting peak oil. Note that the "peak" is actually the sum of many peaks. U.S. oil production peaked in the 1970s, Russia did around 1991, and Europe did in 2000. The worldwide peak will happen when the countries increasing production - like OPEC - can't make up for the declining supply from the rest of us, as well as increasing demand.



Image courtesy of Romaenergia, mirrored locally.