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Page added on October 9, 2012
Peak Oil’s 10 Year Peak – The Plateau of Global Oil Production Explained
Chairman President CEO
Core LaboratoriesFrom his talk at
Enercom
August 2012 (17th annnual)
Denver, Colorado USA
(Ref 6:22-6:55)
What the “Plateau of Global Oil Production” essentially means is that we peaked in global oil production in 2005, and the peak, as it were, is covering a period of 10 years, or so. That’s a good thing, in one sense.
For various reasons, we have been able to extend the peak and sustain oil production at the current (2005) levels for the past 7 years. Core Labs CEO David Demshur, whose company is involved with 1100 of the 4000 actively producing oil fields in the world, says we can squeak out another 3 years of this global peak plateau before global production goes into inevitable decline.
That’s good news for those who are actively working to mitigate the potentially disastrous economic effects of peak oil caused by the spike in oil prices estimated as high as $400/barrel. The bad news is that there are very few individuals, communities and governments taking necessary steps to create the awareness and action needed to mitigate peak oil price spikes. Earthprojects.Info has taken up this challenge as its #1 priority. We believe the price spikes will come with the decline in global oil production (circa 2013-16).
The main component of any peak oil mitigation plan involves voluntary demand destruction like, for example, ending your daily commute to work by working from home or relocating your home to where you work, using mass public transportation instead of driving your car, and so on. Transportation is the #1 demand driving crude oil prices, followed by industrial use of oil.
Demand for consumer use of oil in the home is relatively low, so while demand can be reduced here as well, it is important to realize that the real focus needs to be on transportation. Even if we eliminate all demand for oil from our homes we won’t achieve our goal without addressing the core task of eliminating demand for oil in transportation and industry.
Eliminating all types of non-essential transportation, localizing economies, producing and buying locally grown food (the average piece of food consumed in Canada, for example, travels 10,000 KM by transport), eliminating non-essential industrial processes, products and even businesses that depend on oil is either going to happen voluntarily and systematically or chaotically by force through demand destruction.
Demand destruction is expected to cause a 50% reduction of peak price spikes and bring crude oil prices down to a new Post-Peak level of $200/per barrel after about 6 months of reaching oil’s historic anticipated zenith at $400/per barrel.
The time to take action is now. We have roughly 3 years to mitigate the potentially disastrous effects of peak oil and eliminate our dependency on oil. If we work intelligently and quickly, then we can reduce the demand for oil enough to take the pressure off the price spikes and avoid supply chain and transportation meltdown, which would threaten everyone’s food security – especially those on the OECD developed nations and especially those living in America.
Eliminate your commute, move closer to work and your food supply (grocery store) and restrict your social life to your local area, as far as possible. If you own a business, go electric for power and get off of oil. Very little electricity generation in the USA is powered by oil. Truckers are already converting their engines to run on natural gas, as well, and this trend should increase. Onshore instead of offshore your manufacturing. Localize and decentralize your production and distribution.
The choices you make today will save or kill the weakest segments of the global economy literally and figuratively depending on how high oil prices spike. The global food supply chain depends on oil and even while oil and food may be plentiful, it may become unaffordable for millions for an extended period of time – long enough to kill.
Take it serious. The global food supply has been reduced to 72 days of consumption according to the USDA. A global supply chain meltdown of even 2 weeks or more, what to speak of 72 days or more, could threaten the lives of millions, if not billions, simply because of the distance between people in outer lying areas and the food stocks. Even if food is there, it could become a challenge to get the food to the people in time in a $400/barrel scenario that lasts any extended period of time.
Ideally, every person on this planet would have a 6 month to 1 year personal reserve of food grain in their home to help absorb the shock of a peak oil price spike triggered by declining global oil production. That is not going to happen any time soon on a 72 day global food supply.
We need a 365 day global food supply that is individually distributed. Everyone should be storing at least 50-100kgs of food grains (like whole wheat or rice) per adult (count two small children as 1 adult) above the age of 14. That is enough calories to survive 6 months to a year on a minimal diet of 1 meal a day.
By going vegetarian we can increase the global food supply by a factor of 300% to 220 days without increasing production or farm land because 70% of food grains in the USA are diverted for fattening animals for slaughter – an unnecessary waste of food.
Take action and eliminate the demand for oil. Millions, if not billions, of lives depend on it – maybe even your own.
13 Comments on "Peak Oil’s 10 Year Peak – The Plateau of Global Oil Production Explained"
Plantagenet on Tue, 9th Oct 2012 1:12 am
Only three years of oil plateau left? Well then, we’d better get frakking on replacing oil with NG!
BillT on Tue, 9th Oct 2012 2:20 am
LOL! Planet, you are funny. Dream on.
“… Demand for consumer use of oil in the home is relatively low,…” Really?
Look around at what you see. ALL of it has an oil footprint. ALL of it, if you are a typical American. And you use it all daily. The clothes you wear, the chair you are sitting on, the PC you are typing on, your carpet, the roof over your head, the vinyl on the walls, the carpet on your floor, etc.
Yes, transport is probably the greatest use, but all of those things you use are transported by trucks using oil to move. Oil was needed to mine the ores that were smelted, machined, assembled and installed in that truck as it’s engine. Oil is your life if you live in the West. And no, natural gas will never replace a large percentage of what oil does. It cannot.
I agree that we lave only a few more years of bumpy plateau left before the decent begins. That is why we plan to have our place on the farm completed before 2015 and be out of the city. We can then walk to everywhere we have to go, and almost everything we will need will be locally produced. And ‘need’ is the key word. We may want things, but they will be things we do not need.
Laci on Tue, 9th Oct 2012 2:44 am
The decline in conventional oil may or may not happen within the next three years. I’m inclined to believe that it will not, but it will happen eventually.
I take issue however with the article’s assesment of what is the best course of adaptation to this expected event. I believe the best adapted economies will not be the ones that will power down voluntarily, but the ones who will build up most momentum in the preceeding years. In other words, countries like China which will have a higher growth trajectory will power through, while the ones that voluntarily power down, therefore slowing down their economies, will in fact suffer the most. I recomend people read Zoltan Ban’s blog, or his book “Sustainable Trade”. It is a real eye oppener. Whatever has the word voluntary atached to it, is a fool’s path.
Stephen on Tue, 9th Oct 2012 6:33 am
Three things we could do immedaetlyL
1) Flex work hours and let people choose where and when they want to work. If we eliminated the 9-5 commute every day, this would reduce gasoline consumption significantly.
2) Reverse globalized manufacturing and assembly. If we stop shipping goods to the cheapest labor countries and flying them or shipping them back, this would save a lot of fuel (and create many new local jobs).
3) Create a “victory garden” program to encourage the home farming of local produce, backyard chickens, and revive farmers markets. Encourage grocery stores to accept “home produced” produce and eggs.
4) Mandate that all freight shipments over a certain distance be by boat or rail as opposed to truck. Trains and Boats use far less fuel. One train company says that they can transport a ton of frieght over 400 miles on one gallon of diesel fuel.
5) Invest in electric trolley lines and buses powered by biofuels and expand them to higher rent neighborhoods.
jimmyb189 on Tue, 9th Oct 2012 7:42 am
At last, some real action!
My two cents:
Your grain should be hemp
Oyster mushrooms grow fast on almost anything organic, get some coffee grounds, stack vertical and you have volume in a small space.
BillT on Tue, 9th Oct 2012 9:42 am
Stephen, in other words, revers the last 100 years of change. Easy, just wait for another 100 years and we will be there. Your ideas are good and are some of the ‘shoulds’ but let’s face it, they will never happen.
Most Americans do not have the moral strength to work at home, even if they could, which is less than 1% of the employed.
Bringing factories back means bringing the required energy and natural resources back also, or, in other words, increasing our imports of those items and increasing the cost of all of those items by multiples of current costs. (Unless you want to work for $1 per day.)
Yep! YOU can plant a garden … and take the years it takes to learn how into account when you plan your food supply. Start with tearing up your lawn and cutting down any trees you are blessed with. Veggies don’t grow in the shade. Then protect them from the neighbors who are too lazy to plant a garden, not to mention crows, rabbits, skunks, raccoons, mice, moles, etc. which also live everywhere.
Gear up the factories that make rails, switches, cars, engines, etc to rehab the million or so miles of worn out track. More energy imports needed as steel making is energy intensive. Maybe in 10 or 15 years, your idea might be possible. Forget barges.
Electric trolleys were disposed of almost 100 years ago. What makes you think that the oil industry is going to allow them to come back? Again, imports to make all of that track, etc.
We are already smothering in the import costs of the junk we buy from Asia and the Middle East. And where do we get the oil for all this new manufacturing? Saudi Arabia is maxed out and the countries will excess (Iran, Russia, Venezuela, etc.) are not our friends.
Lots of impossible obstacles in the way of your new world. Good luck!
kervennic on Tue, 9th Oct 2012 11:49 am
I guess these people have no idea how a capitalist industrial society is functionning.
We need a price spike and a collapse of economy, otherwise the life of those who actually have chosen to live differently is going to be a complete nightmare. You cannot have strong cow boys and strong indians on the same land. One need to give way to the other.
I guess some of us do not want a transition. In fact they rather want to be sure the beast will be dead for sure.
Kenz300 on Tue, 9th Oct 2012 1:52 pm
Maybe that rush to globalization that was fueled by cheap oil will come to an end.
Shipping fruits and vegetables around the world for consumption will become pretty expensive as transportation costs increase.
Time to bring the manufacturing closer to point of use. Cheap labor will soon become secondary to transportation costs.
GregT on Tue, 9th Oct 2012 3:21 pm
The boom-bust cycle of the undulating plateau should now be clear for all to see. Economies are dependant on cheap oil and will continue to decline as we move forward.
It is not possible for every person on the planet to stock pile a 6 month to 1 year supply of food. Even if it were, what would we do after 6 months or a year?
BillT is correct, time to learn how to be self sufficient. Move away from large population centres, work harder, and expect less.
shortonoil on Tue, 9th Oct 2012 4:53 pm
“We will be able to stay at this plateau for the next 3 or 4 years.”
We are conducting a rather extensive study of world petroleum depletion. Our determination, thus far, agrees almost exactly with the authors, except for the $400/b figure. Oil prices will escalate significantly, but they will not reach $400/b until about 2027; the time when major field shut-ins will begin.
But, the 3 to 4 year time frame is correct. The situation will appear relatively normal, except for a slowly downward spiraling economy, until 2016 – 2017. After that, chaotic behavior will begin to affect the society. Take steps to prepare.
The Hill’s Group
Earthprojects.info on Fri, 19th Oct 2012 8:53 pm
@BillT –Oil in the home refers to direct use (ie. heating oil). Production of consumer goods would fall under industrial, which we put as #2. How much of industrial oil use goes for consumer goods is a good question though. We are in the city for the short run and our farm house is under renovation for the Peak Oil Spike Era, as well.
@Shortonoil speaking of spikes…I would go with your assessment provided the markets don’t freak out. I am counting on some drama once we get 6 or more months of consecutive reports of global declining production for no explicable reason other than the peak has ended and we are sliding into oil oblivion (with all the media reports). If we can wake up people now and sensitize the markets and actually reduce demand ahead of the decline then, yeah, it wouldn’t be so bad. That is what we are endeavoring for, at least.
@Laci I am not with you on what appears to be a maintain-the-economic-status-quo-at-all-costs. I am more for embracing the long term “reality” (apparent, as it may be) that we are not going to be replacing 90 million barrels/day production anytime within our lifetime (2060). That means a new economic reality that we can call “Relative Growth” – relative to the new bottom we hit on the way down. I am in for a systematic controlled crash-landing. If we prioritize and cut out the fat, we might be spared to be able to maintain the essentials without too much crisis. Crisis for me means not being able to feed people. Watching everyone’s net worth, investments and property values decline is not a crisis per say in terms of the new economy. Our values and value is in for a shift, like it or not. We need to get away from non-essential production (over 90% today) and secure the essentials. Even our essentials are totally oil dependent. Doing nothing other than the same old same old and powering up our V8 just before we hit the brick wall to hopefully apply enough inertia to crash through the wall without sandwiching our car is, in my mind, a better screen play than an economic policy. Change comes hard, but change we must, and the sooner the better for all concerned here. It means a lot more people (than the current <1%) getting reintroduced to agriculture, and all the data points to small organic ag farming as the best way forward in terms of sustainability. Science in terms of machines and chemicals for industry and military has failed the world in more ways than it has helped, but I will save that rant for another day.
@Stephen That is our take, more or less. We, like the UN, advocate a vegetarian diet to maximize the food grain utilization and reduce the health care burden of the cancer/heat attack/stroke diet (meat) and reduce carbon.
@Jimmy Hemp? lol
@BillT Living where you work doesnt mean working at home necessarily. It means living within a distance not requiring you to drive. What all this really means is making better decisions. For example, we move to a new city for a job, and we find a really nice house that is a 1 hour drive from my new office and we find an okay house in walking distance. 10 years ago we would have gone for the commute to get the ideal house. Today, the values have changed and the ideal house is the walker. In other words, use your common sense and if you don't have any, then ask someone who does.
The oil cost of rail will pay off. We have to look at energy saved vs energy invested. Electric powered rail is the best use of industrial power for inner-city and inter-city/inter-state transport. We have to go there, or talk about reverse urban migration back to the farms where the real goods are.
@Kervennic Having a bad day? lol Who is the beast here? I would agree to say that we need more power and profit sharing and better stewardship of the land and resources. Maybe crash and burn is inevitable, but we will continue educating nevertheless as a moral duty.
@Zenz For sure, transport will become a more dominant factor is the cost of goods. Cheap oil is over. We have artificially built a fantasy world/empire upon it that is beyond the natural carrying capacity of this planet in critical ways.
@GregT Right, it is not possible at this point for everyone to stock a year supply. We only have a 72 day supply of grains on hand right now. The UN is calling for a likely food crisis in 2013 as a result. Having food stocks is mainly to right out a possible supply chain meltdown is oil were to surpass $200/barrel and remain there for a significant amount of time. This is especially for the poor who might not be able to afford to buy food, but it could also apply to anyone, regardless of wealth, who could face supply gaps at any price, depending on how markets and people react. If enough people get pissed enough, they could disrupt supply chains even further. We expect the brunt of the price spike impacts to be over within 6 months as markets react and settle down and demand destruction kicks in and brings prices down (to around $200).
Thanks for the great comments and questions!
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Earthprojects.info on Fri, 19th Oct 2012 9:04 pm
By the way, this article/page comes from our website http://earthprojects.info
Someone added it without our knowledge (thanks to whoever you are) and we just realized it after examining the hits from this page from our web logs.
We do a lot of #peakoil content on Twitter so follow us there at @earth_projects
Earthprojects.info on Fri, 19th Oct 2012 9:09 pm
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