Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Sun Dec 12, 2004 3:56 pm Post subject: Post Peak Oil; The Slow Decline?
As most of you know, I have posted on a variety of subjects and I continue to struggle to see the "Big Picture" of the post-peak-oil scenario. It is quite elusive. I am beginning to think that the end of the petroleum age will not happen all at once. Collapse is an economizing process in which a society reverts to a level of complexity that is capable of being sustained. Historically, these collapses have typically occurred over a period of decades or centuries. But what is different this time out is the complexity of our society, globalization, and the fact that this "carrying capacity" we have taken for granted is a phantom based upon a non-renewable resource. Still, it could come a lot slower than we think.
Those of you who have read my Peak Oil Perfect Storm thread know there are many factors at play with the state of the world at large. As oil production declines or supply is disrupted by geopolitical events, prices will rise--particularly the prices of that most oil-dependent and essential of commodities--food. That is a given, I believe. Setting aside peak oil for a moment, let us continue on. Since virtually all commodities use petroleum fuel to move from production to consumption, as fuel prices rise whether by market forces or by currency decisions by OPEC to offset the loss in revenue as the dollar declines due to our trade imbalance, all commodity prices must also rise. Whew! What a mouthful! This will create inflation. To curb the inflation, the Fed will raise interest rates. And as the price of food and other essential commodities rise--along with house payments tied to variable rate mortgages--luxuries and dispensable goods and services will drop out of the family budgets and the standard of living will decline and unemployment will rise.
When energy costs escalate, there will be a period in which an emphasis on conservation & energy efficiency will occur. This will be like the early 1980s when the price of oil caused the world to become more energy efficient. Smaller cars were purchased, insulation put into houses and lighting changed to efficient bulbs. That will occur again putting off some of the worst problems and again push the dawn of peak oil into the future. The demand destruction will create a new buffer of energy supply upon which we will try to grow again. The system will initially appear to rebalance. There will be a dash for more fuel-efficient vehicles and equipment. The poor and many of the over-leveraged middle class will not be able to afford the investment or the fuel. The rich will outbid the poor for available supplies of energy and conservation methods. Unemployment will increase. People will lose their homes. There will be a major transfer of wealth from the poor and middle class to the rich, much like what took place in the 1930's. Stagflation will occur where you have an inability to grow the economy in the face of rising inflation and interest rates driven by a declining dollar or a rise in energy prices. And then the cycle repeats. There may come a time when hyperinflation steps in. This will occur when everyone knows everything they buy will be selling at a higher price very soon (within days or weeks); therefore everyone spends the cash as soon as possible to beat the price increases. And all of this can or will occur without peak oil.
So, let's add the reality of peak oil into the mix. Initially it will be denied. There will be much lying and obfuscation. Terrorists and environmentalists will be blamed. The call for more exploration and exploitation of oil and gas will become a media event. The dash for gas will become more frenzied. People will realize nuclear power stations take up to ten years to build. People will also realize wind, waves, solar and other renewables are all pretty marginal and take a lot of energy and time to construct. Air quality will be ignored as coal production and consumption expand once more. Countries, especially the oil producing ones, due to their total dependence on oil revenues, will decide to reserve oil and later gas supplies for their own people. Conservation and energy efficiency will go a long way to cut use and meet new demand, but once the decline really gets under way, liquids production will fall relentlessly by 5%/year (a guess, no one knows). Energy prices will rise remorselessly. Inflation will become endemic and a world depression will descend upon us. Every year, unrelentingly, we will require further efficiencies in our energy use; our slice of the pie will get smaller and smaller. Whole industries will disappear: motor racing, fast food, motels, private boats and airplanes, and all related industries. We will cut and pare and try to grow our way out of it under our current debt-based monetary system (since it is all we have) but it will not happen. People in Third World countries, like Mexico, will do the only human thing, the thing we all would do in their circumstances--try to get into countries they perceive have wealth and jobs and energy. We will see more imperialist adventures, and, it will add to U.S. isolation as we continue down the path of becoming a pariah nation. Like I have said before, it's all about rate and magnitude. But I think the scenario will be a long drawn out affair due to our precarious economic climate which will induce some major demand destruction long before peak oil hits. One caveat; if peak oil is already here, Katy bar the door. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Last edited by MonteQuest on Sun Jun 08, 2008 12:18 pm; edited 7 times in total
Joined: May 15, 2004 Posts: 253 Location: Southeast USA
Posted: Sun Dec 12, 2004 8:08 pm Post subject:
Well, Schneider, MonteQuest did call it a long slow process, on the bright side. I agree with most of what's been said. I truly believe that MonteQuest is one of the most logical, moderate and level-headed people here about peak oil. However, every civilzation, even after its fall, another civilization has sprung up. It may not initially be a better one but there is one, so there always is a light at the end of the tunnel, in my opinion. _________________ In the long run, men hit only what they aim at. Therefore, though they should fail immediately, they had better aim at something high.-Thoreau
Peak Oil
Joined: Oct 23, 2004 Posts: 494 Location: Canada/Quebec Province
Posted: Sun Dec 12, 2004 8:37 pm Post subject:
TheSupplyGuy wrote:
Well, Schneider, MonteQuest did call it a long slow process, on the birhgt side. I agree with most of what's been said. I truly believe that MonteQuest is one of the most logical, moderate and level-headed people here about peak oil. However, every civilzation, even after its fall, another civilization has sprung up. It may not initially be a better one but there is one, so there always is a light at the end of the tunnel, in my opinion.
The only thing i wish to wait a year is a recession..got a huge students dept and i will maybe only be able to pay it in full next september ! But only IF there is no recession .
Not sure it will be really a slow collapse (nor overnight tought)! If i remember well,EasterEggs didn't really take time to collapse..
There is something we must remember : We are the most complex and globally interdependant civilisation ever born in History..i feel that the more complex is the civilisation,the worst and fastest will be the jump !
Joined: Apr 17, 2004 Posts: 984 Location: Tulsa, Ok
Posted: Sun Dec 12, 2004 9:58 pm Post subject: Agreement
Wow, Monte! Well thought out and thought through. I have thought pretty close to the same things.
The changing that occurs when conservation kicks in. This will have an effect of drawing out the post peak decline. As you say, there are many luxuries that can be done away with. This effect occurring will make it clear to most peak oilers what is happening. Again as you stated putting off some of the worst problems. Bye bye nascar, monster truck racing, mud boggs, etc.
I agree with the logical and realistic progression you have laid out. Long ago I started a thread, What are the indicators? Each of these events are almost as sign posts or indicators for us to see.
Not sure what you mean by pariah nation but I suspect that the countries like America that consume hugh amounts of petroleum will be ‘pariah’. The reason can be numerous for this but still occurring none the less. With countries like India and many Asian able to produce more products. There becomes less need for products from America. Worsening the effects for the US and Japan. If we can’t sell we can’t buy.
So do I understand you correctly? That the pariah effect will worsen the situation here in the US? I have concern that this will be the case, Increasing the rate and magnitude here. _________________ Peace out!
Posted: Sun Dec 12, 2004 10:28 pm Post subject: Re: Agreement
MissingLink wrote:
Wow, Monte! Well thought out and thought through. I have thought pretty close to the same things.
The changing that occurs when conservation kicks in. This will have an effect of drawing out the post peak decline. As you say, there are many luxuries that can be done away with. This effect occurring will make it clear to most peak oilers what is happening. Again as you stated putting off some of the worst problems. Bye bye nascar, monster truck racing, mud boggs, etc.
I agree with the logical and realistic progression you have laid out. Long ago I started a thread, What are the indicators? Each of these events are almost as sign posts or indicators for us to see.
Not sure what you mean by pariah nation but I suspect that the countries like America that consume hugh amounts of petroleum will be ‘pariah’. The reason can be numerous for this but still occurring none the less. With countries like India and many Asian able to produce more products. There becomes less need for products from America. Worsening the effects for the US and Japan. If we can’t sell we can’t buy.
So do I understand you correctly? That the pariah effect will worsen the situation here in the US? I have concern that this will be the case, Increasing the rate and magnitude here.
Thanks for the accolades. A die-off will occur, but more slowly than most think unless something other than a decline in energy production sparks it. We simply cannot sustain this population level without cheap and easily accessible oil. But in the meantime, we will have to share what we already have with the newcomers. The population will continue to grow even in the face of declining food. It is called 'overshoot."
Pariah means an outcast. A pariah nation is one which is despised and avoided by other countries. The unilateral invasion of Iraq set this in motion, and the re-election of Bush has shown the world that America endorses imperial adventures into sovereign nations. They won't soon forget. Paybacks can be a sumbitch, you know. The USA getting its just desserts for hubristic warmongering against world opinion will be welcomed by many. Our complexity makes us the most vulnerable as we are the last ones to know how it is to do without. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Unfortunately, the US economic system, followed by the world economic system, is about to collapse. Social/political upheavals will follow. And producing even sustainable amounts of fossil fuels will become more and more problematic (as problematic as the regions where most of them are found!).
This isn't going to be slow.
Next decade officially begins January 1, 2011. Wonder what the world will be like by then....
Posted: Sun Dec 12, 2004 11:12 pm Post subject: Just can't accept this
[qoute] The USA getting its just desserts for hubristic warmongering against world opinion will be welcomed by many. Our complexity makes us the most vulnerable as we are the last ones to know how it is to do without.[/qoute]
This type of statement IMHO is extremely counter-productive and missrepresents all of humanity if not simple Americans.
During the '50 did the Japanese say: "Americans are pigs...they don't deserve our advanced mico-minature technology...let's not sell them (or the rest of the wold transistor radios)?
During the '60's did the world say: "We don't want your war-mongoring technology...keep your advanced weaponry and ICBM's....?"
During the '70's did the world say: "Don't buy our cheap, economic, automobiles you disgusting Americans. We don't want your war-mongering types ot buy our products?"
During the '80's did the world say: "No thanks America, we don't want your war-mongering technology. Your advanced operating systems and hardware?"
During the '90's did the world say: "Keep your technoloty America...We don't need/want your kind or technology?"
The answer to all the above question is: "HELL NO" It is disgusting to blame America and not blame all the other Nations and peoples that didn't suck the living daylights out of us for their own profit and gain, e.g., China, UK, Austrailia, France, Middle East...
Please stop bashing America...unless you acknowledge that [every other] nation on this planet turned to us for their own interests or betterment.
Joined: Aug 18, 2004 Posts: 694 Location: SF Bay Area, Calif
Posted: Sun Dec 12, 2004 11:22 pm Post subject:
Thanks for your detailed thinking, MonteQuest. I broadly agree, but would like to add some additional points.
1. After following the debates, I've come to the conclusion that the concepts of hard landing and soft landing are more misleading than helpful.
These concepts assume that the process will be a straightforward descent from one state (the present) to another state (the low energy future). Just like a train running from Sacramento to Santa Fe.
In fact, there are many processes going on, in different places and with different timelines. For example, some oil-exporting countries (like Venezuela and Russia) may temporarily experience greater wealth and power. The US, on the other hand, may lose its global predominance because of indebtedness and dependence on petroleum.
So a a history written in the year 2100 will describe about a global shift to low-energy societies, but as you say, it wll happen over a period of decades. We won't wake up one morning to a soft- or hard-landing.
2. I think we're already seeing what the response of the elite will be: nuclear, coal, some oil sands/shale, and conservation. (See the recent report by the IEA and the xxx ). My guess is that this response will come more quickly than we had thought; the key players have an awareness of the problem and are concerned.
3. I generally agree with most of the economic changes you foresee. However, stagflation and depression usually lead to political ferment. What could happen? Fascism? A return to New Deal policies? Something even further to the left? Many small anarchist and socialist projects, despite a right-wing government? Networking between liberal/left groups in different countries? It's hard to predict exactly what will happen, except to say that the sides may be more polarized than we've seen in a long time. These political changes, in turn, will affect peak oil and its consquences.
4. Cultural changes. During the 70s and 80s oil disruptions, we saw dramatic changes in culture and technology. As I've been researching sustainability, I've become amazed at how much work was done in such a short time.
Since we believe those oil shocks were just a foretaste of what was to come, shouldn't we also predict dramatic changes in culture and public attitudes? New ideas new lifestyles, new religions. All we can say now is that an low-energy society will look very different from the present one.
It's easy to under-estimate the speed at which modern societies can mobilize for a challenge, especially once it is understood.
5. Science and invention. Unlike previous collapses, we have several hundred years of science and technology under our belt. True, much of the technology is based on cheap oil, but even so, this knowledge is a treasure if we are smart enough to use it.
Consider how quickly scientific research can proceed with modern instruments and the Internet. Computers can monitor industrial processes to minimize waste of fuel and material. Energy-saving technologies can be rapidly disseminated.
Currently, society basically ignores the problems of energy and sustainability. What progress we could make once we really turn attention to those problems!
Posted: Sun Dec 12, 2004 11:33 pm Post subject: Re: Just can't accept this
Petro wrote:
[q] The USA getting its just desserts for hubristic warmongering against world opinion will be welcomed by many. Our complexity makes us the most vulnerable as we are the last ones to know how it is to do without.[/q]
This type of statement IMHO is extremely counter-productive and missrepresents all of humanity if not simple Americans.
Please stop bashing America...unless you acknowledge that [every other] nation on this planet turned to us for their own interests or betterment.
We're all in this together...
Since the USA is the only country I know of currently engaged in hubristic warmongering, I think it is quite apropos. If you think imperial adventures are ok, then I suggest you educate the rest of the world on that point. You might have a bit of a problem making your case, though. Trust me, they will vehemently disagree with you. I love my country, but I despise our foreign policy. Besides, my statement was merely reflecting the reality and sentiment that exists today in the world, not a bashing of America. Do a little reading in the foreign press. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Oct 10, 2004 Posts: 476 Location: Chicago, IL
Posted: Mon Dec 13, 2004 12:05 am Post subject:
Quote:
Like I have said before, it’s all about rate and magnitude. But I think the scenario will be a long drawn out affair, due to our precarious economic climate that is going to induce some major demand destruction long before peak oil hits.
Quote:
Unfortunately, the US economic system, followed by the world economic system, is about to collapse.
That's exactly why he said he sees it as a slow affair. _________________ "Abortion doctors aren't baby killers. They're life un-ruiners"
5. Science and invention. Unlike previous collapses, we have several hundred years of science and technology under our belt. True, much of the technology is based on cheap oil, but even so, this knowledge is a treasure if we are smart enough to use it.
Consider how quickly scientific research can proceed with modern instruments and the Internet. Computers can monitor industrial processes to minimize waste of fuel and material. Energy-saving technologies can be rapidly disseminated.
Currently, society basically ignores the problems of energy and sustainability. What progress we could make once we really turn attention to those problems!
If you have read my thread on Technology and Peak Oil; Cause and Effect, you know I don't believe there are any technological fixes for peak oil. We need a paradigm shift in our world view that is based upon 2nd law and learning to live and cope within the limits of the environment. Rather than finding more efficient ways to do things, we might be better to eliminate them altogether. For example: do away with labor and time saving devices, production lines, and put people back to work. We need to find the simplest ways of doing things, scale down, and live simpler, less complex lives. In the future if you invest in a factory, that means you help physically build it. Idealistic? Maybe, but it is a lot more sustainable than what we are currently doing, by far. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
This is the most rational, most realistic scenario I have so far read about Peak Oil!
It's only logical to put demand destruction into the equation, and as I said before I think it wont be one rough ride downhill but rather a rollercoaster ride of uphill and downhill. I even think that Peak Oil will never be "realized" until it already happened, because there will always be periods of cheaper energy, which will support the denial of the reality of peak oil. We see it now, as soon as the oil prizes decline everybody is interpreting it as a relief signal, even if the new price level has doubled from about 20$ to about 40 dollar! The same will happen when the price declines from 100$ to 50$ and so on....
A new great depression could well postpone peak oil for another 20 years...
Since virtually all commodities use petroleum fuel to move from production to consumption, as fuel prices rise whether by market forces or by currency decisions by OPEC to offset the loss in revenue as the dollar declines due to our trade imbalance, all commodity prices must also rise. Whew! What a mouthful! This will create inflation. To curb the inflation, the Fed will raise interest rates. And as the price of food and other essential commodities rise—along with house payments tied to variable rate mortgages—luxuries and dispensable goods and services will drop out of the family budgets and the standard of living will decline and unemployment will rise. . . . Unemployment will increase. People will lose their homes. There will be a major transfer of wealth from the poor and middle class to the rich, much like what took place in the 1930’s. Stagflation will occur where you have an inability to grow the economy in the face of rising inflation and interest rates driven by a declining dollar or a rise in energy prices.
Leeb, in "The Oil Factor" suggests that the Fed will not raise interest rates too much, and will see-saw between higher and lower rates to try maintain a balance between inflation and forcing mortgage defaults. I think it is a hopeful sign that the Fed and other countries central banks avoided raising interest rates much through this last summer, because they recognised that higher commodity prices were a result of higher oil prices, and that this itself was damping the economy.
Economic hardship is inevitable, however, because of demand destruction, and diverting of income from consumer goods to heating, food and transport as oil prices rise because of shortage. America, and Americans (all people in general), are resilient, and will manage to convert over time to a sustainable economy. People will start vegetable gardens in suburbia because they won't be able to drive 3 times a day to the mall. Allotments are common in many large cities, especially in Europe, where people who live in apartments go to grow vegetables. Cottage industry and local economic interaction will once again be common, mostly because people will have no alternative if there is endemic unemployment. However, there will be job opportunities in building renewable energy systems, probably also in nuclear power plant construction, and in intensified oil exploration and development.
Regarding the 5% decline after peak, I think that peak will occur fairly soon (<10yrs), but there will be an extended plateau and slower decline than suggested in the drastic scenarios, BECAUSE OF THE MARKET. It is an oversimplification to dismiss the incentive that high oil prices have on application of technology, and the tenacity with which a well can be pumped so long as it can make money. As you know, the peak of oil production, and the midpoint of total oil production may be close, but are not necessarily the same. There will be a strong economic incentive to extend the midpoint, as long as there is a reasonable expectation of a return on investment.
The market will also support development of alternate energy sources such as biofuels, solar and wind, and is doing so already, however feebly at present. Many people are researching hydrogen as a fuel, and a news item posted tonight suggests that a marriage of solar and high-tech is possible. Even if the electrical grid works best with less than 20% wind, more wind power can be utilised in production of hydrogen.
A combination of solar, wind and fuel-cell applications at a village or town scale of modest per capita energy use is a good way of producing clean water as a byproduct of electricity and should be introduced in developing countries, or even in North America or Europe.
Ultimately, we will have to survive on an energy budget much lower than what we are using now, but I think we can get there without a horrible disruption, and it may not be that uncomfortable. _________________ Don't Worry, Be Happy
(B. McFerrin)
listen:
http://ubl.artistdirect.com/store/artist/album/0,,238303,00.html
Joined: Aug 18, 2004 Posts: 694 Location: SF Bay Area, Calif
Posted: Mon Dec 13, 2004 12:55 am Post subject:
MonteQuest wrote:
If you have read my thread on Technology and Peak Oil; Cause and Effect, you know I don't believe there are any technological fixes for peak oil. We need a paradigm shift in our world view that is based upon 2nd law and learning to live and cope within the limits of the environment. Rather than finding more efficient ways to do things, we might be better to eliminate them altogether. For example: do away with labor and time saving devices, production lines, and put people back to work. We need to find the simplest ways of doing things, scale down, and live simpler, less complex lives.
You [MonteQuest] seem to posit two forms of technology: a complex, wasteful, and inevitably futile technology which you see as the problem, and a less complex technology which you see as our only alternative.
As examples, I contrasted industrial farming and low-input organic farming.
The problem with going back to Simple Ways, as you propose, is that they require a lot of knowledge! This is where science and information technology is indispensable. What a boon it will be to farmers of the future to have an online reference to pests and blights. Rather than sacrifice virgins to ensure a good harvest, we can apply compost tea and rotate crops.
As we make the turnaround to a low-energy society, let's not throw out science and technology; let's re-direct them.
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! I just hope it will wait one year 
...
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