Crude Awakening: Peak Oil & The End of Cheap Energy: Part 2 by John Richter

Peak oil is the maximum oil extracted on the planet. It marks half all the possible recoverable oil being recovered. What are the impacts on the economy and the world?

“We want our oil, we want our gas, we’re gonna drive, and we’ll pay whatever it takes, and, if we have to, we’ll cut back somewhere else in our lives.”

John Richter explains the physical and economic constraits on oil flows, including the demand and supply sides. He discusses the disappearance of excess capacity, increase in US demand, lack of tankers and limited oil personnel. He points out how supply has failed to increase rapidly enough to hold price steady, marking the beginning of the peak oil curve.

Richter points out that moving people from low fuel economy cars to mid fuel economy cars, while others move from mid fuel economy to high fuel economy, would cut in half gasoline demand, if usage held steady.

“At some point, the low wage worker can not afford to drive to work anymore… We can’t shut down the low wage section of the economy because of oil.

“What are the economic effects of Peak Oil? Higher inflation and higher unemployment… When you have rapidly escalating energy prices, you get stagflation.

“We have a lot of options here, to reduce our energy use, but the runway is short. Peak Oil is imminent, and the declines will be sharp, and we will have to act quickly.”

Local Future Network
Videographer/Editor: Aaron Wissner