Peak oil, when considered on a global basis, is the point where all available oil reservoirs are producing at maximum potential, and after which total production can only decline.
The peak oil model, originally developed by Shell Oil’s geophysicist M. King Hubbert during the 1950s, simply states that since the amount of oil in the earth is finite, eventually, as we use it up, production will begin to decrease and will reach a point where supply can no longer meet demand.
When we reach this historic moment, prices will begin an upward climb that will never be reversed. This is supply and demand at its most basic, and at its most unforgiving.
That peak oil will occur is not argued. The only debatable issue is when. It is important to note that peak oil is not the point where world oil reserves are depleted. Depletion comes much later, and by then the damage to world economics and to global peace will be long done and irreversible.
We all know that the U.S. is dependent on foreign oil for its survival. We also know that this dependence on oil is so important to national security that the entire geopolitical landscape of the planet has been disrupted in its name.
Up until 1970, the U.S. produced all of the oil it consumed. Every time the demand for oil increased, production was increased to meet the need. Prices were fairly stable. Then something happened. Something that was predicted by M. King Hubbert’s research during the 1950s.
Using enormous amounts of historical data combined with complex mathematical formulas, Hubbert demonstrated in the 1950s that U.S. oil would reach peak production in the year 1970 and that production would then decline every year after that.
He hit the number right on the money. U.S. oil production peaked at about nine million barrels a day in 1970 and has been on the decline ever since. Not surprisingly, the U.S. balance of trade shifted not long after that from surplus to deficit, a trend that continued and worsened for the balance of the century.
No Turning Back
The world has changed considerably since 1970, and the U.S. now finds itself in a rather uncomfortable position. India with one billion people and China with 1.3 billion are experiencing rapid technological growth and with it, higher energy demands.
The U.S., whose 5 percent of the world’s population consumes 25 percent of the world’s oil, is finding it increasingly difficult to hang on to its disproportionately large piece of the pie. Unless the U.S. dramatically decreases oil consumption, which is not likely any time soon, world demand for oil will continue to rise rapidly and to heretofore unexpected levels.
Prices will remain stable in the face of rising demand only if global supplies increase to meet growing demand. Remembering that oil is a finite resource — that is, the Earth is not producing new oil to replace the old — it becomes clear that the economic (and perhaps political) tipping point of the precarious world balance comes not 80 years out when we run out of oil, but far sooner, when declining production can no longer meet growing needs — in other words, the moment of peak oil.
Peak oil is frightening because once we pass it, there will be less oil available in the world than the world is consuming. And there will be no place to go to get more. So prices in the free market will rise and rise until some nations are unable to pay.
These nations will have to do without. They will not accept this easily! Experts disagree on exactly when we will reach peak oil globally, but many think we already have.
Has It Already Hit?
Kenneth S. Deffeyes, formerly with Shell Oil and now professor emeritus at Princeton University, has studied the issue and determined that world oil supplies have already peaked.
He declared on Thanksgiving Day, Nov., 24, 2005, as World Oil Peak Day, and has predicted declining supplies into the future.
Interestingly enough, these peak oil formulas include all known oil reserves, developed and undeveloped, and even reasonable estimates of those yet to be discovered. It should be noted that while no one can be 100 percent certain of future discoveries, with today’s advanced technologies and satellite imagery geologists have a pretty good idea of what is out there.
Some critics believe that Deffeyes’ estimates of worldwide oil reserves are too low and that peak oil will not be reached for five or 10 years. The most conservative estimates put it out even further, but those have been somewhat discredited because they have already underestimated the growing global demand for oil.
But whether its last year, or a few years hence, one thing is certain: We aren’t ready for it, and current technology cannot bail us out.
Make no mistake that this is not just about pain at the pump. The consequences of peak oil are far greater. In fact, many believe that peak oil represents the biggest threat to U.S. security in the history of the nation.
Experts predict that oil price increases of the magnitude peak oil will bring will send the U.S. economy into recession. Some estimate that it could last as long as 40 years. Unemployment and foreclosures will soar. The American lifestyle will never be the same.
The geopolitical consequences are worse. Based on the 2005 International Energy Outlook, global oil consumption will increase by an incredible 50 percent over the next 20 years. While oil-inspired tensions in the Mideast are already at an all-time high, what happens when we bring a burgeoning China and India into the mix?
Considering that some nations will be unable to meet their oil requirements, it is clear that the have-nots will resort to any means at their disposal to meet their needs. Consequently, the potential for increasing global hostilities, manifested by everything from increased terrorism to all out war, will only mount.
Demand Action Now
So clearly, we must demand action from our political leaders now, in hopes that Mr. Deffeyes is wrong and that we have a little time to prepare for the inevitable peak oil day.
There is no shortage of plans for reaching oil independence, but actually doing something about it would be novel. Unfortunately, the oil industry has the most powerful lobbying machine in the nation. They have enormous access to those who now govern us at all levels, access that has resulted in legislative paralysis.
Those who receive generous contributions from oil interests will not give these subjects the highest priority that they deserve. As a result, the only plans that reach the light of day are those that are so long-term, like hydrogen-powered cars, that they are of little value and essentially “oil-industry safe.”
Global warming and peak oil pose significant threats to the planet and the security of this nation. Neither subject can be dismissed as being the ravings of tree-hugging lunatics. Both are supported by sound science and both can be addressed with overlapping corrective measures.
Consequently, we must insist that our political leaders disentangle themselves from their industrial supporters.
One way we might help them is to send the loudest message possible to our state and nation’s capitals, and that is by unseating all incumbents regardless of party or persuasion. This action would neutralize the power of industrial lobbyists and shift political power back to the people, and it could very well save the nation and change the face of American politics forever.
Glenn Gilchrist, who formerly owned a software company in New York, lives in Woodlake.
