[seahorse2]

I have a question for all the economists out there? Could America's economy operate on the oil it produces which is about 9mbpd? China, with a billion people, uses 6mbpd, so, so what would America look like operating on 9 mbpd? Hypothetical of course, but what are the differences you see? Would it take some form of economic martial law to keep things running on 9mpbd?

Assume America has to run on what it produces by next year, how would that be accomplished? Assume a gov't marshall law plan and alternatively, economic downsizing, depression I guess.

[NeoPeasant]

$this->bbcode_second_pass_quote('seahorse2', 'I') have a question for all the economists out there? Could America's economy operate on the oil it produces which is about 9mbpd? China, with a billion people, uses 6mbpd, so, so what would America look like operating on 9 mbpd? Hypothetical of course, but what are the differences you see? Would it take some form of economic martial law to keep things running on 9mpbd?

Assume America has to run on what it produces by next year, how would that be accomplished? Assume a gov't marshall law plan and alternatively, economic downsizing, depression I guess.

[seahorse2]

Any idea how much rationing would have to occur? How it would be enforced? What industries would simply fold? Which would make it? For example, I have a friend in the pet industry, selling pet beds etc. I assume they would be out of business. What about hybrid cars? Would Toyota etc take off? Concrete business take off making nuclear reactors?

[mekrob]

Do you mean with a growing or even stagnant economy?

HAHAHHAHAHAHHAHAHAH.....HAAHHAHAHHAHAHAHA....HAHAHHAHAHAHAH.
No.

Would live go on?
Well, for some. Others wouldn't fair so well.

If we were ever forced to do it by say a worldwide embargo, I doubt the politicians or even the people would just sit idle while that happened and would instead demand war.

[aahala]

US oil production hasn't been 9mbd for 30 years or more. Last year it
was about 5.1 and has dropped almost every year since the North Slope
peaked.

[seahorse2]

In this hypo, I'm not interested in growing the United States economy, only stablizing it if possible. So, is it possible and if so, what stays, what goes? Is it possible to stabilize it without tanking the US dollar? For example, the US attracts a lot of investment bc it is a growing economy? Could it be stablized and if so, could it be stablized without tanking the dollar?

Aahala, thanks for the correction. I just check the EIA data and you are absolutely right. On a separate question, if we produce about 5 mbpd, and we import about 10mbpd, and we use about 21 mbpd, where is the difference coming from?

[venky]

$this->bbcode_second_pass_quote('seahorse2', 'I')n this hypo, I'm not interested in growing the United States economy, only stablizing it if possible. So, is it possible and if so, what stays, what goes? Is it possible to stabilize it without tanking the US dollar? For example, the US attracts a lot of investment bc it is a growing economy? Could it be stablized and if so, could it be stablized without tanking the dollar?

Aahala, thanks for the correction. I just check the EIA data and you are absolutely right. On a separate question, if we produce about 5 mbpd, and we import about 10mbpd, and we use about 21 mbpd, where is the difference coming from?

[canis_lupus]

hmmmm....interesting.

Let's see: i wonder what combination of inputs and uses gets us the most milage. If we start with the arbitrary 9mbpd in fossil fuel, we need to make up 13 in other ways. What if we capped our usage at an arbitrary 15mbpd?

We ration. Great place to start.
We pick up as much as we can in biofuels. Can we create 3mbpd of biodiesel?
Can we lean harder on the coal in the short term?
Can we leverage solar/wave/wind to pick up some shortfall...in the short term?

In other words, how can we powerdown with technologies we've already got as quickly as possible to cause the least amount of harm to the economy?

If anybody has a workable answer to that, we've all been chumps posting on these boards!

[nth]

This 9mbpd question is assuming government controlled consumption. If it is WW2 style rationing as someone suggested, then I say no one will die of hunger that weren't already dying of hunger. The government can simply restrict usage by giving out ration coupons. If they are egalitarian and give every person the same amount, instead of prioritizing it to industry with exception of military and emergency service crews like fire, police, etc.

As for industries, I think chemical, automotive, truck, train, buses will all get hit hard. Lots of people will be unemployed as it will be a shock to the economy and does not give enough time for people and industry to adjust. I don't think it is possible to adjust down to 9mbpd without major unemployment.

What we will see is that people be selling their ration cards to sustain their life.
Our current lifestyle definitely will not be sustained unless you are wealthy.

[seahorse2]

Alright, maybe Pup or someone familiar with how much oil is used by which segment of society can help us out here. But, if we have one year to get the US using 9 mpbd, and it requires gov't rationing - how will it be accomplished. How much driving has to be curtailed. Could truckers be exempt from rationing? Could farmers be exempt? leaving only consumers to be rationed? What about articifical price controls for other goods/services?

What segments would survive?

[Windmills]

To stabilize the economy, you're also going to have to stabilize population growth. As the population grows, the economy must grow and produce new jobs for the new workers entering the labor force each year. Otherwise, you'll continually spread thinner and thinner a finite amount of goods and services, resulting in growing unemployment and declining standards of living. Controlling population growth is probably the biggest psycho-social obstacle to any sustainability plan. Even if everyone agreed to return to a low-tech, super-low consumption agrarian utopia, you still face the problem of constant population growth on a limited piece of land at some point in the future. Controlling childbirth and death opens up a big can of worms that many people, even PO aware, are reluctant to dicuss. Until that aspect of humanity is solved, humans will continually cycle between growth and die-off in population in the future.

[kochevnik]

When I lived in China I could ride my bicycle from the outer suburbs to downtown in about 20 minutes - 17 Million people crammed in a space the size of a typical 100,00 person US city.

9 mbd is roughly 40 percent of current consumption. I think you would have to cut personal auto transport to almost nothing. EVERYTHING in the USA is designed and predicated around an automabile based culture. No car means lots of things are either gone or face the need for major redesign.

As a matter of fact, I really can't think of a single aspect of our culture in the US which would not be affected.

Could it be done ? Sure.

Could it be done without collapsing the economy ? I seriously doubt it.

[pup55]

Source: BP Review

Oil is only 40% of our overall energy use.

We know that gasoline usage is about 10 million barrels per day. So, all you would have to do is quit selling gasoline to get down to about 9 mbpd.

If you increased the other fuel types by 10% each, you would be able to replace 3 of the 10 million. Toecutter would like this because people would start to go crazy converting their little hondas over to electric. Natural gas cars are easily doable, with current technology, but in light of recent reports, we might want to take it easy on the natural gas supply. Diesel: no problem.

Maybe you would be able to get another 1-2 million barrels per day out of biodiesel and some combination of ethanol and electric.

So you might be in the realm of feasibility if you could halve the fuel consumption of the existing car fleet. Since the average is now 22, and these hybrids get about 40, maybe this is close to doable.



Here is an old graph from the EIA on fuel use by type. Not much reason to think the ratios are too much different from these but this illustrates that there is some room for growth of alternatives.

Kochevnik is right, though, there would be some economic pain. This alternative implies keeping the auto fleet the same size, but converting it to use half as much fuel. But, to save even more, you would not let the auto fleet stay the same size. You let it contract temporarily to whatever size, and eventually replace everything with hybrids or electric. During the changeover, people would learn to do without some of this driving (conserve) and everything would eventually balance itself out at some lower level of energy consumption.

This would be a pretty serious undertaking, but if we absoutely had to, I think it could be done, for now. But in another 10 years, when our oil supply is even more depleted, and our vehicle fleet is much bigger, it will not be able to be done.

So that's the plan. Quit selling gasoline, let everybody figure out how to solve the problem any way they can, in about 5 years we have the problem fixed, temporarily, until the coal and gas run out.

[ECM]

Here is a link to sources of petroleum:

EIA


The following removes Stock Change and Adjustments:

Notice that if we count NGL and Crude oil production it was 7.241 mbpd estimated in 2004. ALL processing gains are counted in U.S. production even though most would not exist without the importing of petroleum products. Even with these gains counted as production the U.S. still imports 11.851 mbpd and only produces 8.265 mbpd. That is only 40.3%.

If I go back and divide the processing gain against all production, domestic 7.241 mbpd and imported 11.851 mbpd the real U.S. production is only 37.9%. The share of processing gains for U.S. production would be .388 mbpd giving total production from domestic supplies of 7.629 mbpd.

[MrBill]

I am a bit sceptical about this report, but the conclusion that a solid public transport network is essential is inescapable in my mind.
$this->bbcode_second_pass_quote('', ' ') WASHINGTON, March 24 (Reuters) - If the price of crude oil ever jumps to $100 a barrel and sends gasoline costs soaring, you're better off living in New York City than just about anywhere else, according to a study released on Friday.
New York tops the list of ten American cities that could survive, at least economically, if oil roared to $100.
That's the conclusion of the online healthy living company SustainLane, which looked at which cities could maintain their quality of life and economy if faced with skyrocketing pump prices. The price of crude oil accounts for about half the cost of making gasoline.
The 10 U.S. cities that could best deal with such a crisis are: 1. New York, 2. Boston, 3. San Francisco, 4. Chicago, 5. Philadelphia, 6. Portland, Oregon, 7. Honolulu, 8. Seattle, 9. Baltimore and 10. Oakland, Calif.
The company said its survey found that good public transportation systems were most important to allow people to commute to jobs and schools and shop if it became too expensive to use cars.
"A solid public transportation system will get workers to the office and shoppers to the mall, regardless of the price of oil (and) provide critical insurance against the overt threat of sky-high oil prices," said Warren Karlenzig, chief strategy officer of SustainLane.
Other factors affecting living and economic conditions included a city's access to locally grown food and the availability of wireless networks for telecommuting.
The survey focused on expensive oil and gasoline for transportation, rather than costly energy used for heating.
U.S. oil on Friday traded around $64 a barrel, far from its highest price ever of almost $71. However, some energy experts believe $100 oil is possible if a terror attack caused a major disruption in crude exports from giant OPEC producer Saudi Arabia.

[pup55]

$this->bbcode_second_pass_quote('', ' ')access to locally grown food

[Peepers]

When faced with a major personal budget crisis, you cut back on the biggest expenses first -- house and car.

When faced with a major oil supply crisis, you cut back on the biggest sources of consumption -- transportation and industry....



As has often been pointed out on this site, waiting for market forces of supply, demand and price to influence a more oil-efficient economy will likely cause serious and abrupt economic fallout.

Thus, public policy can influence a smoother transition to a more oil-efficient economy. My suggestion is to phase-in a BTU tax (replacing gas taxes) at the federal and state levels, perhaps at a 10-20 percent increase per year. A BTU tax "rewards" those users of oil which are more efficient in their consumption and "penalizes" those that aren't.

Further, proceeds from the BTU tax can be invested in sectors of the economy which are less energy intensive. Since most publicly funded transportation projects are awarded funding based on a points scale (ie: projected reduction of traffic congestion earns the project 1 point, projected safety increases earns it another point and so on).

Instead, the BTU gains the greatest priority in the scoring system. For example, if a railroad expansion project is projected to be 25 percent less BTU intensive than a highway widening project, than it would earn 4 points. If incentives for developing high-density, pedestrian-oriented urban land uses for an inner-ring suburb or core city neighborhood is 75 percent less energy intensive than building a larger highway interchange in an exuburban area, than the land use investment earns 12 points. Unfortunately, just because walking doesn't involve a motorized vehicle, some don't see that as deserving of receiving funds from a energy tax. I'd say its energy efficiency makes walking (and the land uses which enhance its attractiveness) deserving of MORE funding.

The result is you won't have to drive a couple miles to go to the bank or pick up a few groceries for the day. Instead, you walk a couple of doors down in a vibrant, mixed use neighborhood. Maybe your job has been influenced to relocate a couple of blocks in the opposite direction. For work trips or errands that are farther away, an electric trolley bus, tram, train or a car-sharing service will get you there. For cities a couple hundred miles away, a high-speed train or bus will do the trick. For trips beyond, if we start saving oil now, we will be able to keep our airlines for those trips for which they are best suited.

But, as we all know, the clock is ticking....

[MrBill]

$this->bbcode_second_pass_quote('pup55', '')$this->bbcode_second_pass_quote('', ' ')access to locally grown food

[seahorse2]

Hi Pup and everyone else,

Can someone help me understand this: its my understanding the US uses about 21 mbpd in oil. The US produces roughly 5, and imports roughly 10, so where is the difference? Is it NGL etc?

Also, Pup I'm not following the idea that the US would have to quit selling gasoline to get usage within 9 mbpd.

[Daryl]

One of the key issues facing the US is how to avoid another abrupt energy "shock". The economy will fare much better if the upcoming changes take place in as gradual a manner as possible. One of the most obvious policies that needs to be implemented is a slow graduated rise in the gasoline tax. Sectors of the economy that are completely dependent on ultra low gas prices need to slowly squeezed out over a multi-year period.

Alas, government seems frozen in permanent failure on this issue.