NationStates Jolt Archive

http://moneycentral.msn.com/content/P119982.asp?GT1=6706

I'm not going to lecture or give a sermon, but shit like this really boils my blood.

He says he's curious as to why the "laws" of supply and demand haven't already addressed the problem of rising oil prices.

This is part of a reply e-mail I sent to him after being so disgusted by the blindness of the article:

"Think of it this way: If the world's ocean's water was oil, and if we'd been pumping that nonrenwable resource out of the ocean for the past 100 years, and if there was only about half left, the regular "laws" of supply and demand simply wouldn't apply. There isn't any way to supply more oil when there isn't any more to give - and no amount of economic reasoning is going to change the fact that when you have a nonrenewable product that can be sold incrimentally and it has reached a 50% used/stock balance, the prices for the remaining 50% are going to increase along with the product's scarcity."

Let me make this very clear: When our daily oil input drops, say, 5%, prices can go up as much as 400% (Anyone here remember the later 1970's?). Oil output has already, or is going to, decline, terminally, for the rest of our lives, by a rate of 1.3%-2.8% per year, every year, depending on who you quote. Economies dependant upon oil (US, EU, Japan, China in the next five to fifteen years, etc; as well as every other country that uses computerized banking, relies on internal combustion engines to transport necessary food - the average American eating food that has been shipped 1,200 miles (5,000 for Canadians) - along with anything else dependant upon oil to run, produce, or sustain the $45 trillion dollar global economy) will go into downward spirals, then recessions, then depressions, then completely collapse - possibly all within the same year, once things really get underway.

My question is: How many of you actually believe that we're going to be running the world on oil, exactly as it is now, in the year 2020? (The year the article writer says Cambridge is projecting for Peak Oil, ignoring the opinion of those better connected to the oil industry like, hmmm, Matthew Simmons, CEO of Simmons & Company International, the largest oil investment firm in the world.)

I refuse to believe that people can truly be this ignorant.

http://www.lifeaftertheoilcrash.net/

My question is: How many of you actually believe that we're going to be running the world on oil, exactly as it is now, in the year 2020? (The year the article writer says Cambridge is projecting for Peak Oil, ignoring the opinion of those better connected to the oil industry like, hmmm, Matthew Simmons, CEO of Simmons & Company International, the largest oil investment firm in the world.)The question isn't whether we'll be running the world exactly as it is now, but whether we will still be dependent on oil. Imagine changing global motorized transportation to something other than gasoline made from crude oil within the next 15 years. That's not going to be easy, and certain countries aren't giving very many incentives to head that way.

It's truly appalling that there isn't yet a widespread alternate (renewable)source of energy for automobiles and the like.

It's truly appalling that there isn't yet a widespread alternate (renewable)source of energy for automobiles and the like.

Biomass...

The question isn't whether we'll be running the world exactly as it is now, but whether we will still be dependent on oil. Imagine changing global motorized transportation to something other than gasoline made from crude oil within the next 15 years. That's not going to be easy, and certain countries aren't giving very many incentives to head that way.

Retrofitting 700 million vehicles with engines that don't rely on internal combustion produced with oil is going to be very hard indeed. Not to mention millions of commercial and private airliners and ships.

That's why it's such a big damn deal, though. :p

Biomass...

...is not viable. Oil gives an Energy Returned On Energy Invested (EROEI) rate of about 30 to 1. Biomass (in the form of Biodiesel, which I assume you're referring to) has an EROEI of about 3. You do the math.

Not to mention the fact that we'd have to cover pretty much the entire continent of Africa with biomass farms to replace what we get from the world's oil fields - right now. (A billion people in China may be wanting their own cute little sport ute ten years from now. What then?)

Oil output has already, or is going to, decline, terminally, for the rest of our lives, by a rate of 1.3%-2.8% per year, every year, depending on who you quote. Economies dependant upon oil (US, EU, Japan, China in the next five to fifteen years, etc; as well as every other country that uses computerized banking, relies on internal combustion engines to transport necessary food - the average American eating food that has been shipped 1,200 miles (5,000 for Canadians) - along with anything else dependant upon oil to run, produce, or sustain the $45 trillion dollar global economy) will go into downward spirals, then recessions, then depressions, then completely collapse - possibly all within the same year, once things really get underway.
Cheer up! No need to worry! If a decline in oil supply was as dangerous as you say then Nazi Germany and Imperial Japan would have been much easier to beat. When the allies cut off much of their oil, their economies took a real licking but kept on ticking. And their oil supply dropped by a heck of a lot more than 1.3-2.8% per year. They did two main things to adapt. They economized and they used substitutes. Everything from liquified coal to peanut oil.

Cheer up! No need to worry! If a decline in oil supply was as dangerous as you say then Nazi Germany and Imperial Japan would have been much easier to beat. When the allies cut off much of their oil, their economies took a real licking but kept on ticking. And their oil supply dropped by a heck of a lot more than 1.3-2.8% per year. They did two main things to adapt. They economized and they used substitutes. Everything from liquified coal to peanut oil.
They were a lot easier to beat than expected. Both Nazi Germany and Imperial Japan were defeated several months before schedule. One big reason for this was the fact that there wasn't any fuel left, and the German counter offensives were halted by a combination of lack of fuel and air support. The fact that fuel was so low reduced the ammount of flight training that could be given to Axis pilots and that resulted in Allied air superiority, effectively bringing the war to an earlier end. The economies ticked on other resources besides oil (such as coal) but the war machines did not. And consider that society is much more motorized than back then, and there was rationing back then.

Why dont we all just admit we're screwed and have a beer?

Cheer up! No need to worry! If a decline in oil supply was as dangerous as you say then Nazi Germany and Imperial Japan would have been much easier to beat. When the allies cut off much of their oil, their economies took a real licking but kept on ticking. And their oil supply dropped by a heck of a lot more than 1.3-2.8% per year. They did two main things to adapt. They economized and they used substitutes. Everything from liquified coal to peanut oil.

That also happened to be fifty years ago, during World War Two, when (A) we had far, far fewer vehicles, boats, and planes to fuel, and (B) when the gov't could do things like near-instant economization and substituion.

The fact remains that there is no substance in the world that can give an EROEI like 30 to 1. There are no scalable alternatives to oil that exist today, nor will there be unless a technological breakthrough allows us to pull something else out of the ground nearly for free (In Iraq, it costs all of $1 per barrell to get oil out of the ground) that will give us dozens of offshoot products (kerosene, tar, plastic, diesel, etc) all the while remaining seemingly infinite (as oil was viewed for the first 50 years it was around).

The ideas you put forth represent the real problem surrounding Peak Oil. No one wants to believe it, because the truth sucks.

Why dont we all just admit we're screwed and have a beer?

Hell yeah. I'll even buy. :D

Why dont we all just admit we're screwed and have a beer?
The meds I'm taking don't agree with alcohol... :(

Reality is going to smash the West's irrational utopia like a ton of bricks. The West has seemingly turned it's back on logic, and instead embraced vacuous ideas ('equality', 'diversity') and nurtured destructive behavior. Hence, it's no surprise that 'peak oil' is a virtual non-issue as compared to say, Michael Jackson or Osama bin Laden.

I refuse to believe that people can truly be this ignorant.


Denial has never helped. You know people are that ignorant, and more ignorant than that...

The ideas you put forth represent the real problem surrounding Peak Oil. No one wants to believe it, because the truth sucks.

I don't have any problems. I live in a first world country with expensive to extract but appreciable oil reserves, considerable quantities of natural gas and vast amounts of coal. We also have uranium and oil sands. We can, like, sell you some of this if you want. It won't be cheap, but then it's a seller's market. I'm sure you'll be able to afford enough to tide you over until you run down your stocks of gas guzzelers, buy some more hybrids from Japan, get a few bicycles, etc.

Why dont we all just admit we're screwed and have a beer?
Make that two. As I always say: "Ein Bier ist kein Bier!" (One beer is no beer).

Anyway, I'm really looking forward to what the big oil companies (must?) have in their drawers.
Just look at the way the computer industry developed within the last 50 years, 20 years, 10 years, 5 years - Don't you think that mankind is smart enough to come up with other solutions as well?

Sure, the cars will probably be a lot lighter-built, and instead of going "vroom vroom" they'll probably make those irritating sounds of electro-motors. But there will be other fuel alternatives introduces within the next 5 to 10 years. Change is already underway if you look around. A lot more cars here are now using natural gas instead of fuel. (Now I know that that is going to run out as well, but it helps cover some time for new stuff to be ready for massproduction. And it doesn't take a new engine, just a new tank).

I'm still looking forward to my first own car, though - once I'm though with university, I definitely need one. I'd be interesting to see that development. Hopefully it will work. Besides, I believe that the countries using most of the oil should really work on their mileage for a start!

I'm not advocating this as a serious solution, but more as an example of how simple changes can prevent less oil doesn't from being a disaster:

Lower the speed limit on highways to decrease the amount of fuel used so that it matches the 1.3-2.8% decrease in oil production you expect. Saving gasoline this way would be a little inconvenient but hardly the end of the world, and it would save lives.

The meds I'm taking don't agree with alcohol... :(

Swing on over to Amsterdam, perhaps? Surely what the coffee-houses sell won't interfere with your medication. :p

The truth is going to smash the West's irrational utopia like a ton of bricks. The West has seemingly turned it's back on logic, and instead embraced vacuous ideas ('equality', 'diversity') and nurtured destructive behavior. Hence, it's no surprise that 'peak oil' is a virtual non-issue as compared to say, Michael Jackson or Osama bin Laden.

While I agree with the MJ and ObL comment, I have to point out that this is a situation that will likely affect every industrialized country...

Denial has never helped. You know people are that ignorant, and more ignorant than that...

I know, but still. :rolleyes:

I don't have any problems. I live in a first world country with expensive to extract but appreciable oil reserves, considerable quantities of natural gas and vast amounts of coal. We also have uranium and oil sands. We can, like, sell you some of this if you want. It won't be cheap, but then it's a seller's market. I'm sure you'll be able to afford enough to tide you over until you run down your stocks of gas guzzelers, buy some more hybrids from Japan, get a few bicycles, etc.

(Damn, I knew I should have been more specific.) I wasn't trying to imply that you were the one with problems, merely that you presented one of the main problems with the acceptance of Peak Oil.

That being said...

Oil reserves are not limitless. Natural gas and coal are not limitless. Uranium is going to run out in the next 25-40 years anyway, not to mention the ghastly amounts of energy needed to construct, start, maintain and protect a nuclear power facility. Oil sands currently have a negative EROEI (Energy Returned On Energy Invested), meaning that for every whole unit of energy put into mining oil sands, a fraction of a unit of energy is given back. (Currently standing at 0.5 - 0.6 EROEI. Oil = 30.00 EROEI) Hybrid vehicles? Bicycles? Do you realize that the US alone contains around 2.4 million miles of roadways?

Hell, I live seven-and-a-half miles from the nearest grocery store. You think I'm going to be out on a bicycle on 100 degree days, carting around things like milk? And that's a small commute!

In 2020 we will probably still use a lot of oil. How much depends on how fast the supply dwindles. When the supply decreases the price increases, that's correct. But that increased price gives the necessary incentives to change. Our chemical industry is a lot better than it was 50 years ago, and there is literally nothing that cannot be done as well or better without oil as with. The only hinder is that the alternatives are more expensive. For example there are bio-fuels that work like gasoline and diesel. (in the same engines). They cost about $2-$5/litre, so when the gas-prices reach that level you'll see how the market solves real shortages. Politicians give people the right incentives by simply staying out of the way and not subsidising oldfashioned technology or counteracting innovation.

Hell, I live seven-and-a-half miles from the nearest grocery store. You think I'm going to be out on a bicycle on 100 degree days, carting around things like milk? And that's a small commute!

Let's see, US uses 22 million barrels of oil a day, at $60 a barrel, that's nearly half a trillion a year out of a 15 trillion dollar economy... So the U.S spends about 3% of its GDP on oil. If the price of oil quadruples tomorrow, that's still only 12% of GDP. You could think of it as a nine percent pay cut. Now that would really suck, but in a land as rich as the US I doubt that many people would actually die from this.

But it's unlikely to quadruple tomorrow. If it does quadruple it'll probably take time, and that will give people time to adapt. If next time you replace your car you buy a little hyundai, that might cut your gasoline bill in half, so quadrupled oil prices would only be like a 3% pay cut. A lot easier to take. Then what with oil prices being so high, Hyundai will probably put out a little hybrid that only uses a quater of the amount of fuel as your original car. You will be able to do the same number of miles as before for the same cost.

Lack of oil might suck, but it doesn't have to be a disaster.

I just checked my calender. It's been a month today since I filled my tank. I've been using less than a liter a day. I drive a Hyundai Getz. Consider one next time you go car shopping. (Your milage may vary.)

The societal changes necessary to adapt to a peak oil world will be immense. This is the beginning stage. It will take multiple decades to acclimate this technological, fossil fuel based civilization with a new energy source. That is, if a new source is discovered.

I'm not advocating this as a serious solution, but more as an example of how simple changes can prevent less oil doesn't from being a disaster:

Lower the speed limit on highways to decrease the amount of fuel used so that it matches the 1.3-2.8% decrease in oil production you expect. Saving gasoline this way would be a little inconvenient but hardly the end of the world, and it would save lives.

I think you misunderstand the problem here. Daily world total consumption of oil is about 83.5 million barrels. Remember, there's 42 gallons of oil to a barrel, and, once refined that translates to about 19.5 gallons of gasoline. That's 1.56 billion gallons of gasoline per day (83.5 M/barrels pared down to 80 M/b for simplicity's sake). 2.1% of that is 32,760,000. Even if Peak Oil only affected transportation (which it certainly doesn't), that still takes up two-thirds of the world's daily consumption.

21,621,600 gallons of gasoline saved by lowering speed limits? Perhaps if every single one of the 700 million vehicles currently running in the world were running at exactly 55 mph, all the time - no curves, no stoplights, no leaky headers, no engines misfiring, no water in any of the fuel, all the fuel being of the same grade, being burned in similar ways - they could all save approximately, nothing, because EPA mpg estimates are determined by vehicles traveling at 48 mph! (All of this ignoring the fact that the EPA has admitted that they inflate the numbers 15-30% on a regular basis.)

C'mon, buddy. This is just common-sense stuff. :)

The societal changes necessary to adapt to a peak oil world will be immense.

I don't see why. I mean, what would I have to do to adapt?

1. Buy an economical car. (Check, done that.)

2. Put plastics in recyle bin. (Okay, I could improve here.)

3. When you replace economical car, buy hybrid. (Okay, I can do that.)

What else do I need to do? My electrical power comes from coal, not oil, so no change there. I don't buy much plastic. I'm assuming everyone else is doing 1, 2 and 3, so I don't need to worry about them. It doesn't seem like an immense change to me.

In 2020 we will probably still use a lot of oil. How much depends on how fast the supply dwindles. When the supply decreases the price increases, that's correct. But that increased price gives the necessary incentives to change. Our chemical industry is a lot better than it was 50 years ago, and there is literally nothing that cannot be done as well or better without oil as with. The only hinder is that the alternatives are more expensive. For example there are bio-fuels that work like gasoline and diesel. (in the same engines). They cost about $2-$5/litre, so when the gas-prices reach that level you'll see how the market solves real shortages. Politicians give people the right incentives by simply staying out of the way and not subsidising oldfashioned technology or counteracting innovation.

Sir/Ma'am, as quoted from the first page:

(From previous post:)Biomass.../...is not viable. Oil gives an Energy Returned On Energy Invested (EROEI) rate of about 30 to 1. Biomass (in the form of Biodiesel, which I assume you're referring to) has an EROEI of about 3. You do the math.

Not to mention the fact that we'd have to cover pretty much the entire continent of Africa with biomass farms to replace what we get from the world's oil fields - right now. (A billion people in China may be wanting their own cute little sport ute ten years from now. What then?)

Please, read first. There's not even 30 replies yet.

C'mon, buddy. This is just common-sense stuff.

Okay, drive your car at 100 kms per hour for 300 kilometers and see how much gasoline you burn. Depending on your car you might go through a whole tank. Then drive your car at 80 kms an hour for 300 kilometers. You'll find you use considerably less fuel. If you don't believe me, try it on your next long trip.

- snip -

You are focusing on driving, product-cost versus product-need, and generally ignoring the salient points of this topic.

You have an economical car? Good for you. That car cost twice its weight in fossil fuels to produce. Everything in that car is nearly certainly a by-product of, or produced by, oil. Plastics? Derivative of oil. Aluminum? Well, let's see, it takes 365 barrels of oil to produce one ton of it, so take most of the metal in your car and weigh it, see what that takes. Rubber? Oil. Glass? Oil. Fabric/leather? Yep, they take oil too.

And, of course, there are the innumerable power stations, hydroelectric dams that took - and take - millions of gallons of oil to create; same goes for every other type of power plant. Let's not forget the home that you live in, the computer that you're working on (consumed ten times its weight in fossil fuels in construction), the clothes that you're wearing, the food that you eat, the water/soda/beer/wine that you drink, the water you bathe in, and the heat and air conditioning you rely on during the summer and winter. ALL of these things, at one point or another, cost a certain amount of CHEAP oil to build, run, or maintain, and when CHEAP oil starts to get expensive, EVERYTHING gets expensive. There are no economically scalable or technologically feasible ways to replace the enormous amounts of energy we can get from oil. The laws of thermodynamics cannot be broken.

Okay, drive your car at 100 kms per hour for 300 kilometers and see how much gasoline you burn. Depending on your car you might go through a whole tank. Then drive your car at 80 kms an hour for 300 kilometers. You'll find you use considerably less fuel. If you don't believe me, try it on your next long trip.

Did you even read the text above what you quoted? Are you purposely ignoring the math that's proving you wrong, or what? Or are you advocating lowering the speed limit to, say, 40 mph on every highway in the world? (And every other road where the speed limit exceeds 41 mph?)

My question is: How many of you actually believe that we're going to be running the world on oil, exactly as it is now, in the year 2020?
I reckon in 2020, nothing will have changed.
People will be bitching about the oil price, and only drive cars with tiny engines, and people will complain about how dependent they are on oil, but no one will stand up and bring forth a meaningful alternative.
Then in 2021, all hell breaks loose...

Reality is going to smash the West's irrational utopia like a ton of bricks. The West has seemingly turned it's back on logic, and instead embraced vacuous ideas ('equality', 'diversity') and nurtured destructive behavior. Hence, it's no surprise that 'peak oil' is a virtual non-issue as compared to say, Michael Jackson or Osama bin Laden.

I really don't like you're tone mister....

No, seriously, are you a Nazi or what?

Did you even read the text above what you quoted?

It had big words and numbers in it. Me only understand simple things like me drive car slower than usual on highway, it use less gas for same distance.

Are you purposely ignoring the math that's proving you wrong,
You call me liar? Me car do use less gas when drive slow! Mongo get mad!

Or are you advocating lowering the speed limit to, say, 40 mph on every highway in the world?

The first sentence in the post where I mentioned the idea said it wasn't a serious idea.

But if it would stop civilisation from collapsing, why the hell not?

But then, as I pointed out, it's not a serious idea, so don't worry about it. It's just an example of a very simple way to save significant amounts of oil.

ALL of these things, at one point or another, cost a certain amount of CHEAP oil to build, run, or maintain, and when CHEAP oil starts to get expensive, EVERYTHING gets expensive.
Yep, and all the oil bought by the U.S. totals about 3% of its GDP. So if the price of oil quadruples it would be as if the U.S. had 9% less money. That would suck, but it wouldn't be the end of the world.

There are no economically scalable or technologically feasible ways to replace the enormous amounts of energy we can get from oil.

Gee, maybe you'll have to use less energy then. Or maybe as the price of oil increases it will become economical to use other sorces of energy? That's possible. Maybe a bit of both?

The laws of thermodynamics cannot be broken
I think you could be right on that.

Yep, and all the oil bought by the U.S. totals about 3% of its GDP. So if the price of oil quadruples it would be as if the U.S. had 9% less money. That would suck, but it wouldn't be the end of the world.

Some people...

Okay, 3% of our GDP is spent on oil. Fine, let's quadruple-point-two it and make it 10%, just for simplicity's sake.

If it costs automakers 4 times as much (in oil, but remember, a car takes twice its weight in oil to build) to build your car, the cost of your car increases.

If it costs the farmers 4 times as much (in oil, but remember, all of the these things take oil to produce or use) to fertilize, spray pesticide on, grow and harvest your food, the cost of your food increases.

If it costs (xClothingManufacturerx) 4 times as much (in oil, but remember, all those machines run on, or were built by, oil; remember the trucks that drive them to you and the ships that ship them to you; remember the stores that needed to be built with oil, most of which are lit by oil or buildings built by oil; can I make this any more clear?) to make your shirt, the cost of your clothing increases.

If oil costs four times as much, quite nearly everything else has a price increase. Inflation, as Germany has taught us, can be a very, very bad thing indeed. Should oil prices increase fourfold in one day, I think a very likely outcome would be a systemic global trade market failure as the price of oil would obviously have to be traded up to even higher levels, causing an immediate stalemate as governments started realizing that they needed to pay four times as much for something that runs their countries.

Forgive me if I look at a picture that's a little bit bigger than you're used to, doll, but you ain't got shit.

Inflation, as Germany has taught us, can be a very, very bad thing indeed.

It's a pain in the butt. But to compare 9 or 10% inflation to Germany's hyperinflation is a bit silly. I seem to recall inflation around that high in the U.S. before that big guy, what his name? Used to run the Fed? Volcker, that's it, before the Volcker disinflation. That much inflation wasn't good, but civilization survived. If the price of oil quadrupled overnight, (Atomic war in Middle East?) that would be a hell of a shock to the world economy, But before long people would be pumping superhot steam into coal mines and pumping up the disgusting sludge that results. But quadrupled oil prices are unlikely. According to the futures markets, there is a 54% chance oil will be the same price it is now or cheaper in a year's time. If you think that's crazy, buy oil futures now.

Forgive me if I look at a picture that's a little bit bigger than you're used to, doll,

Why thank you. You're quite a ducky yourself.