Peak Oil - A look into the future to 2015 (or should I say into the past to 2015)...

Dear Friend:

Update: Well, obviously 2015 has come and gone and some of the predictions below have been pushed into the future due to the discovery of new fossil fuel reserves. I purposefully left the newsletter pretty much unchanged because it is interesting to look back and then into the future. What if we didn't find the new oil reserves? Even with the new reserves, are we really better off? If you look back at history, entire civilizations were wiped out due to overuse of natural resources... the Mayas, the Anasazi, the Easter Islanders, and the Vikings to name a few.

Conspicuous Consumption: The fatal flaw in all these otherwise "advanced" civilizations was their overconsumption of their natural resources often to do things like build pyramids and temples to please the elite. The one similar thing in all these communities is that they never saw it comming. Deforestation, oil consumption, over fishing, pollution without concern, unsustainable farming and livestock practices, and more - these things are going on TODAY! If things are not changed, we may be the next vanished civilization. And we'll never see it comming until it's too late.


Originally written in August 2007:

I recently spent some time in a 3rd world country and it made me think... who would be better off if the price of gas hit $6.00 a gallon?...

Group A - Grows most of their food locally using mostly manual labor, rides tricycle taxis or 150cc motorcycle taxis, walks a lot, uses mass transportation to travel farther distances, and doesn't seem to mind if the electricity goes off for most of the day.

or Group B - Depends on big agribusiness and transportation for their food supply, heavily dependent on fossil fuels in every aspect of their lives, wouldn't walk to the corner store if their life depended on it, is very dependent on gas guzzling personal vehicles for transportation, has no problem with driving 1 mile or 1000 miles by themselves, and wouldn't know what to do without electricity and air conditioning!

It's pretty obvious that Group A would fare better when the price of oil skyrockets. I know you don't want to hear it and probably don't believe it, but a lot of people in Group B will not survive a real oil crisis. Not true you say! Well, would you be surprised if I told you it has already happened and is happening as we speak? Just look at what happened in North Korea after the Soviet Union collapsed. North Korea was a highly industrialized country unlike the mostly agrarian South Korea at the time. After the USSR collapsed, the supply of oil to North Korea and countries like Cuba dried up. The farm machinery would not run, the manufacturing and processing plants shut down, the transportation trucks sat idle, there was not enough electricity to run irrigation pumps, and the soil was ruined due to bad farming practices. Of course, there was no more artificial fertilizer because the fertilizer plants all depended on oil. Does this sound familiar? The whole system crashed and millions of people died as a result.

Those Who Do Not Study History Are Doomed To Repeat It

If there are oil shortages in the US or even if the price just gets too high, you are going to see all these things happen right here in your own back yard! Your food is produced by big business. Guess what?... those businesses like to make a profit. If it becomes unprofitable, those businesses will park their tractors and combines so fast it will make your head spin.price of milk

Why is milk $4.00 a gallon?

Because of the high price of oil.  And... they are making ethanol from all the feed corn! It won't be long before Americans stop buying milk and they send all those milk cows out to pasture. Well, you can probably do without milk, but what are you going to do when the same thing happens to cereals, bread, vegetables, drinking water, beer, etc?

Update 2018: A very sad statistic... some farmers (including dairy farmers) are committing suicide at a rate higher than veterans. Mostly due to the fact that they are in financial trouble because the commodity prices are so low. I think we should do whatever we can to help both these groups out.

What will it be like in 2015?

That's just a little over 7 years away. It's within all of our lifetimes (hopefully), so you can't ignore the problem and let the next generation deal with it. This will happen to you - not your children or grandchildren. This is simple mathematics folks... Currently, the world uses 87 million barrels of oil a day (mbpd). And currently, the world produces about 81 mbpd. It's interesting to note that we are producing less than we are consuming right now. I honestly don't know what is going on with that. We are either dipping into the Strategic Petroleum Reserves (SPR), or the slack is being taken up by alternative fuels, or someone is doing without. Not sure what is going on there, but I suspect it's a little of all three. It sure doesn't look good though!

Note: (in 2018), in the chart below, the supply line has come up a bit to the 81 mark and the demand has come down a bit to the 99 mark.

oil supply and demand

Now on to 2015... given a 2% rise per year in world consumption, we will be theoretically consuming about 101 mbpd in 2015. And here's my description of what will happen on the production end... for the next few years or so after 2007, you'll see a slight increase in production. Then you will see a steady decline in production from then on out. After all, there is only so much of the stuff in the ground. In 2015, the production level will be at about 74 mbpd. Now with that kind of supply and demand in 2015, oil is going to be very expensive and only the rich will be able to afford to drive and eat. That leaves you and me to fend for ourselves. Here were the predicitions back in 2007...

Year Millions of Barrels per Day Consumed
2007 87,000,000
2008 88,740,000
2009 90,514,800
2010 92,325,096
2011 94,171,600
2012 96,055,032
2013 97,976,128
2014 99,935,648
2015 101,934,360
2016 103,973,048
2017 106,052,504
2018 108,173,552
2019 110,337,024
2020 112,543,760

There are only 1.3 trillion barrels of oil in the ground (current figure is 1.726 trillion).

If the demand continues at 2% each year and if the supply could meet that demand, oil would completely run out around 2037. Now, don't get too worried... there is no way production will ever keep up with demand, so there will always be oil available way past 2100 if you can afford it. And remember... this whole scenario can be pushed up to tomorrow with another terrorist attack, oil embargo, hurricane or other natural disaster, oil refinery fire, etc.

So now that you know it's going to hit the fan very shortly and in your lifetime, what are you going to do about it? My next series of newsletters are going to help you with that. Topics will include...

  • Generating electricity
  • Securing drinking and irrigation water
  • Growing your own food
  • Security - there will be riots and people who will steal from you. Can you really blame them? They will be fighting for their lives. In drought stricken areas like India and Africa, this is already commonplace. The poor will kill the rich and take their belongings to survive.
  • Should you relocate and where?

Like the Boy Scouts say... Be Prepared!

Still don't beleive gas will get real expensive by 2015? Just look at the "average" line in this real gas price chart and you can obviously see where it is heading.

Note: I took a ruler to this chart and tried to predict where the average line would be in 2015. It's just a rough estimate, but it's in the $7.00 a gallon range. I think it will actually go higher than that. People in Europe have been paying $7.00 a gallon for about a year now, but I think $7.00 a gallon will have a greater impact in America because up until now, we have taken cheap gasoline prices for granted...

An email reply to my newsletter...

Your newsletter about oil gives a very simplistic and unduly optimistic view and fails to mention Chemical Winter. This is the factor overlooked by virtually everyone even though its impact is accelerating. Chemical Winter and Nuclear Winter are two separate processes that generate the same result - termination of life on earth.

Chemical Winter is generated by solvent emissions from furnaces and transportation combining in the atmosphere producing DNA alterations and other failures in living tissue. No living thing is exempt.

Since Chemical Winter is tied directly to oil generated emissions, I believe your newsletter is remiss in not mentioning this.

Extinctions directly tied to oil generated atmospheric solvents: Frogs, pollinating insects. Many more have been extirpated in various ranges and population crashes among others are directly attributed to solvents. Bear in mind that pesticides are mostly made with solvents, so emissions from furnaces and transportation are essentially pesticides that are being applied to the entire planet.

Have a nice day...

John Newell, Pickering, Canada


Sincerely,

Bill Anderson