Hoarding is exactly what the government is doing right now by filling the SPR, and frankly it's the best thing that could happen. It drives prices up. High prices encourage demand destruction. They also finance new well development. The hoarded oil gives us a buffer to fall back on once shortages become more prevalent. High prices are what we need in order to adapt to what's coming, and the sooner they happen, the better.
PEAKING OF WORLD OIL PRODUCTION: IMPACTS, MITIGATION, & RISK MANAGEMENT
Robert L. Hirsch, SAIC, Project Leader Roger Bezdek, MISI Robert Wendling, MISI February 2005
DISCLAIMER This report was prepared as an account of work sponsored by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof.
EXECUTIVE SUMMARY
The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking.
Prices and price volatility will be? Will be? How about "are now"?
ibid.
Quote:
Important observations and conclusions from this study are as follows:
1. When world oil peaking will occur is not known with certainty. A fundamental problem in predicting oil peaking is the poor quality of and possible political biases in world oil reserves data. Some experts believe peaking may occur soon. This study indicates that soon is within 20 years.
2. The problems associated with world oil production peaking will not be temporary, and past energy crisis experience will provide relatively little guidance. The challenge of oil peaking deserves immediate, serious attention, if risks are to be fully understood and mitigation begun on a timely basis.
3. Oil peaking will create a severe liquid fuels problem for the transportation sector, not an energy crisis in the usual sense that term has been used.
There is no way that gubmint does not know about Peak Oil. None.
ibid.
Quote:
Mitigation initiated earlier than required may turn out to be premature, if peaking is long delayed.
But mitigation will cause Peak Oil delays.
{Moderator note: Here is a recent follow up to the Hirsch Report}
Joined: Oct 28, 2004 Posts: 294 Location: SoWashCo, Minnesota
Posted: Mon Mar 07, 2005 9:40 am Post subject:
Some more choice quotes from the conclusions:
Quote:
• Waiting until world oil production peaks before taking crash program
action would leave the world with a significant liquid fuel deficit for more
than two decades.
• Initiating a mitigation crash program 10 years before world oil peaking
helps considerably but still leaves a liquid fuels shortfall roughly a decade
after the time that oil would have peaked.
• Initiating a mitigation crash program 20 years before peaking appears to
offer the possibility of avoiding a world liquid fuels shortfall for the forecast
period.
The obvious conclusion from this analysis is that with adequate, timely
mitigation, the economic costs to the world can be minimized. If mitigation
were to be too little, too late, world supply/demand balance will be achieved
through massive demand destruction (shortages), which would translate to
significant economic hardship.
There will be no quick fixes. Even crash programs will require more than a
decade to yield substantial relief.
In this case, 'Crash Program' has more than one meaning.
The report was prepared for the Department of Energy's National Energy Technology Laboratory (NETL) by Science Applications International Corporation (SAIC).
MQ _________________ 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.
US report acknowledges peak-oil threat
By Adam Porter in Perpignan, France
Wednesday 09 March 2005, 18:23 Makka Time, 15:23 GMT
It has long been denied that the US government bases any policy around the idea that global oil production may be in terminal decline.
But a new US government-sponsored report, obtained by Aljazeera.net, does exactly that.
Authored by Robert L. Hirsch, Roger Bezdek and Robert Wendling and entitled the Peaking of World Oil production: Impacts, Mitigation, & Risk Management, the report is an assessment requested by the US Department of Energy (DoE), National Energy Technology Laboratory.
It was prepared by Hirsch, who is a senior energy programme adviser at the private scientific and military company, Science Applications International Corporation (SAIC).
They work extensively on defence and geopolitical issues for clients, including many for the US government.
Advisory roles
Among current job openings at SAIC are positions at Fort Benning (formerly School of the Americas) and a private military contract to help retrain the Albanian air force in Tirana.
Hirsch has held a wide variety of positions in the US energy hierarchy including senior energy analyst at the Rand Corporation, through to a presidentially appointed assistant administrator for solar, geothermal and advanced energy systems.
He has also previously worked for the US Department of Energy on numerous advisory committees, including the DoE Energy Research Advisory Board.
This new report follows on from two presentations by Hirsch last year. One on 1 March to the same National Energy Technology Laboratory and another on 14 June last year at the Annapolis Centre for Science Based Public Policy. Here Hirsch laid down his ideas on the peak of oil production.
The Annapolis Centre for Science-based Public Policy is a group which has received $658,000 in funding from Exxon Mobil since 1998. It openly disputes the idea that global warming is the result of burning fossil fuels.
But this brand new senior-level report on "peak oil" is unprecedented in US government circles. It is not just the existence of the report itself that is such a landmark in the current oil debate. Its conclusions also pull no punches.
Uncertain timing
"World oil peaking is going to happen," the report says. Only the "timing is uncertain".
The effects of any oil peak are similarly not ignored. Specifically, the impact on the economy of the United States. "The development of the US economy and lifestyle has been fundamentally shaped by the availability of abundant, low-cost oil. Oil scarcity and several-fold oil price increases due to world oil production peaking could have dramatic impacts ... the economic loss to the United States could be measured on a trillion-dollar scale," the report says.
The authors of the report also dismiss the power of the markets to solve any oil peak. They call for the intervention of governments. But also they rather worryingly point to a need to exclude public debate and environmental concerns from the process. They say this is needed to speed up decision-making.
"Intervention by governments will be required, because the economic and social implications of oil peaking would otherwise be chaotic. But the process will not be easy. Expediency may require major changes to ... lengthy environmental reviews and lengthy public involvement."
Hirsch notes, despite arguments from the major oil companies and producer nations, that new finds of oil are not replacing oil consumed each year. Despite the advances in technology reserves are becoming increasingly difficult to replace.
Three scenarios
The report sees "a world moving from a long period in which reserves additions were much greater than consumption, to an era in which annual additions are falling increasingly short of annual consumption. This is but one of a number of trends that suggest the world is fast approaching the inevitable peaking of conventional world oil production".
The report then takes three possible scenarios and outcomes. Firstly that energy replacement solutions, or "mitigation" as the report states, are started 20 years before any "peak". Secondly that solutions are only enacted 10 years before any peak and, thirdly, that solutions are only put into practice as the peak becomes apparent.
In what some may see as an optimistic assessment, the authors believe 20 years is enough time to limit damage from any peak. However, they point out that "if mitigation were to be too little, too late, world supply/demand balance will be achieved through massive demand destruction".
Demand destruction is a modern way of saying catastrophic recessions and shortages. But as well as these predictions, the report lays out "signals" it believes will be apparent in the run-up to any peak. This is perhaps the most worrying aspect of the report, as it seems to describe the very events that are taking place at the moment.
Supply insecurity
"As world oil peaking is approached, excess production capacity ... will disappear, so that even minor supply disruptions will cause increased price volatility as traders, speculators, and other market participants react to supply/demand events," the report says.
"Simultaneously, oil storage inventories are likely to decrease, further eroding security of supply, aggravating price volatility, and further stimulating speculation ... oil could become the price setter in the broader energy market, in which case other energy prices could well become increasingly volatile and unpredictable."
The report highlights a series of ways to minimise any impacts. From increased fuel efficiency to technological help in stopping the practice of "oil-left-behind" or non-extractable oil and various forms of new liquid fuels, liquefied coal and gas-to-liquids.
But in its conclusion the report makes troubling reading, noting that "the world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions were gradual and evolutionary. Oil peaking will be abrupt and revolutionary".
This report is the clearest signal yet that the U.S government is taking the subject of "peak oil" seriously. Yet it remains to be seen what actions can be taken to stop this potentially "revolutionary" change.
Aljazeera
Joined: Aug 11, 2004 Posts: 56 Location: New-Brunswick, Canada
Posted: Thu Mar 10, 2005 4:44 am Post subject:
Namaste,
I was watching Dan Rather's last report on CBS Evening News yesterday night and I was amazed at how Peak Oil has risen to the surface since the lowered prices of the Oil barrel. So this has led me back to these forums to share my anxiety with you all. Peak Oil has earned my attention once more.
It seems now that we are heading towards nothing short but collapse of the oil market. According to the CBS news report, economy analysts' expectations have been by far exceded since last summer. They predicted all sorts of scenarios remember? Well, Wall Street analysts say it's worse then they imagined.
One analyst in particular said, quote: "If you think we're going to get back to those cheap oil days, well your wrong those days are absolutely gone now!" Another said the the oil market is tightening every month.
OPEC says it's not their fault.
Saudi Oil says it's not their fault either- they'd be willing to ship more oil if the US had more refineries built.
What is to be expected now? Personally, I see not future for the oil industry or industry itself. Our occidental civilisation is coming to an abrupt end.
Soon, competition for the remaing oil barrels will be fierce.
North Korea and Iran have stirred bad blood against the US. The US and China are looking at eachother with stingy eyes. Russia is shifting it's eyes around anxiously and Canada is praying it's conventional energy sources will hold out.
Indeed, the future is very bleak for the "modern" civilization. Either we hit the ground at blazing speed in a full trottle transition, or the economy gets so roughed up in a slow transition that the military will point a gun to your head if you try to steal something for the superstore because one pound of rice isn't enough.
I read the entire PDF. Very interesting. It should be required reading for everyone. It logically raises the issue and addresses the limitations of solutions and especially the difficultly of the transportation liquid fuel issues.
Quite often it is lost in the debate that the main impact (in the initial decade) of Peak Oil is on transportation liquid fuels (gasoline/diesel). There is really no threat to food supplies or electricity in the near term. They make up a fraction of total oil consumption.
The use of oil for transportation is the issue for the first decade of Peak Oil.
I think that study made this point quite effectively.
the main impact (in the initial decade) of Peak Oil is on transportation liquid fuels (gasoline/diesel). There is really no threat to food supplies or electricity in the near term. They make up a fraction of total oil consumption.
the main impact (in the initial decade) of Peak Oil is on transportation liquid fuels (gasoline/diesel). There is really no threat to food supplies or electricity in the near term. They make up a fraction of total oil consumption.
Uh, transportation is what GETS the food to us!
Uh, it doesn't disappear in year one of PO.
70% of our liquid fuel consumption is by daily commuters including the idiots driving an SUV 40 miles each way by himself. Clearly there is room for 10% to 15% savings in gasoline consumption as fuel prices rise.
Do you seriously believe getting food is going to be an issue in the first couple of years of Peak Oil? You may not be able to have that 3000 mile caesar salad or fruit imported from Argentina or catch of the day seafood in Kansas, but you likely wont starve anytime soon.
10 years down the road might create some serious issues if there is no progress in changing society. But those who believe in a year one PO hard crash lack a basic understanding of the issues that are really happening.
We may be in year one of PO already. Some believe peak was in 2004 and we will only realize it in the rear view mirror. Are you hungry yet?
Joined: Aug 14, 2004 Posts: 2060 Location: San Diego, Ca.
Posted: Mon Mar 14, 2005 1:35 am Post subject:
Quote:
Do you seriously believe getting food is going to be an issue in the first couple of years of Peak Oil? You may not be able to have that 3000 mile caesar salad or fruit imported from Argentina or catch of the day seafood in Kansas, but you likely wont starve anytime soon.
Just hope you still have a job or other source of income to pay for your food post-peak. _________________ "Peak oil isn't more than an interesting industry factoid and doesn't have anything to do with the hysterics speculated on ad nauseum around here!" ReserveGrowthRulz
Do you seriously believe getting food is going to be an issue in the first couple of years of Peak Oil? You may not be able to have that 3000 mile caesar salad or fruit imported from Argentina or catch of the day seafood in Kansas, but you likely wont starve anytime soon.
Just hope you still have a job or other source of income to pay for your food post-peak.
You won't need money to buy food or the drugs to pacify you in the giant welfare state heading down the pike. _________________ ree rah rip ram. sunofabitch godamn. hidey didey christ almighty. rah rah crap
Well i mailed the report to some science bureau's from our Goverment. I hope they are looking it through. I know some people know about it on a more influential level but i still don't get why there is little action.
I see a lot of action in the UK at the moment though, just a little more of these reports and stuff and maybe we can see some real progress. I guess they might be debating it behind bars and seeing what they could do about it (or at least i hope it is so).
Taskforce Unity. In the UK, the situation will really become apparent in September say. At the moment, the British Chancellor has frozen fuel price rises for six months after the election. The Road Hauliers Association knows whats coming and they are starting to freak, but the average Joe won't realise whats hit them until late summer. Interesting times.
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ree rah rip ram. sunofabitch godamn. hidey didey christ almighty. rah rah crap 
