Peak Oil: Abundance? Not Really

It’s certainly understandable and indeed common practice in probably every sales conversation in every profession known to man that putting the best spin on the story told is a given. Most buyers/consumers would be surprised at the very least if a presenter offered up her or his best but then immediately discounted that version with other information contradicting it all and discouraging the consumers from even considering what’s being offered. We all understand there’s a game to be played.

While that may be standard practice and simply part of the bargain to eventually be struck in the great majority of consumer transactions where the parties tend to be on equal footing, energy supply conversations don’t fall into that category when the discussion is between everyday consumers and industry officials or their representatives.

Matters of such scope tend to be outside the range of interest for all but a few, so the public relies upon the fossil fuel industry to inform them of significant events which will in time greatly impact us all. Few relish the thought of being the bearers of bad news, and when the bad news about energy supply has the potential to create so much disruption in our lives, there’s an even greater reluctance to share anything but the happiest of happy stories.

That’s an excellent strategy if today is all that matters and information with an attendant need for planning/preparation are irrelevant. If only energy supply—specifically oil production—would fall neatly into that cubbyhole. It doesn’t … not even a little bit.

The countless adaptations and utilizations of oil for the past dozen-plus decades has been a marvel of demonstrated ingenuity and technological prowess. It’s almost impossible to imagine a fossil-fuel-free past, and it is every bit as difficult to envision a future no longer powered by this miraculous finite substance.

We’re a long way off from a world without fossil fuels, but we’re not so far away from a world where the plentiful and affordable and accessible supplies stop being plentiful and affordable and accessible.

It won’t happen overnight or in the course of a few weeks or a couple of months, either. It is a slowly but steadily unfolding process, currently modulated by the delicate balance of price and supply/demand considerations. But oil remains a finite product. The fact that the industry has now been obliged to seek off-shore, deep-water supplies or engage in the costlier and more energy-intensive production efforts to extract tight oil from shale formations suggest that changes are in the offing.

If we had enough still of the easily accessible and affordable crude oil supplies they’ve working for decades, all of these extravagant efforts would be a blip on the radar screen. But now, it’s what we have. That’s an issue.

It may not be necessary to provide the public with reams of data about the current struggles to keep supply and price at levels acceptable to the consuming public, but to assert with straight faces that we’re in a new era of abundance is at the very least a tremendous disservice to a public which should now know that changes are likely.

Those of us who are old enough to remember the long gas lines four decades ago are well aware that energy supply issues are disruptive in ways beyond belief. No one wants that experience again, but if we are going to be entering a future where today’s level of supply and price is no longer assured—with all of the consequences associated with it—providing the public with enough information so that they are aware and in positions to begin the lengthy and complex efforts to transition away from fossil fuel dependency is simply the only correct approach to take by those in the know.

[C]an we safely say we have moved into an era of energy abundance? The word ‘abundance’ is defined as “an extremely plentiful or oversufficient quantity or supply. Affluence; wealth.” Are we truly in an era of oil abundance?
Leave it to Michael Levi to put it best: ‘setting production records and passing milestones is fundamentally different from abundance. By pretty much every meaningful indicator, the abundance story is wrong.’ Why? First, there’s the physical volume of crude oil we continue to import—just under 50 percent of our total needs. Second, there’s the price, which remains above $100 per barrel at the global benchmark; spending on oil consumes more than 6 percent of the nation’s GDP. And, of course, there’s the continued vulnerability to price shocks and the impossibility of ‘Energy Independence.’ As Houser and Mohan state in their book [*], energy independence is a ‘loaded term… implying potential economic and geopolitical benefits that may be elusive in practice.’ That’s a nice way to say that energy independence is a myth. Abundance isn’t a myth, but it remains a long way away.

We cannot afford not to know that….

* Fueling Up: The Economic Implications of America’s Oil and Gas Boom by Trevor Houser and Shashank Mohan of the Peterson Institute for International Economics

~ My Photo: Louisiana bayou – 11.14.09

* I invite you to enjoy my two new books [here and here], and to view my other work at richardturcotte.com :

* Life Will Answer

Thought-provoking inquiries & observations about how (and why) Life does … and does not, work for everyone. [Inspired by my book of the same name]

* The Middle Age Follies

A column offering a slightly skewed look at life for those of us on the north side of 50.

Looking Left and Right:
Inspiring Different Ideas,
Envisioning Better Tomorrows

Peak Oil Matters is dedicated to informing others about the significance and impact of Peak Oil—while adding observations about politics, ideology, transportation, and smart growth.

peak oil matters