The Oil Drum | Plateau update

211 comments on Plateau update

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Halfin on April 4, 2006 - 2:09am

One minor point, usually with a centered moving average you'd cut it off half the window size from the end of the data. I guess in your case you are gradually reducing the window size, so that the last data point is averaged over a half window (4 1/2 or 6 1/2 months) to the left. It's a little confusing the way it is shown now, because later data may alter the shape of the moving average graph.

I'll also point to Lou Grinzo's analysis of the monthly U.S. consumption figures:

http://www.grinzo.com/energy/blog_entry_archive/2006/03/2006x03x29_5.html

U.S. oil "demand" (i.e. consumption) in January was down 2% from a year earlier, and for gasoline it was down 0.6%. Especially interesting in conjunction with your vehicle miles travelled data being up in January.

Lou concludes:

The larger issue, though, is that demand, particularly for gasoline, didn't rise. We haven't tipped into a recession, there is no fuel shortage, the population increased, and yet demand is essentially flat--so what the hell is going on? Simple: Prices are up in the last year, roughly 35 to 40 cents/gallon higher in January 2006 than they were a year ago. In other words, all that supply and demand stuff from Economics 101 is kicking in. Prices have been high enough for long enough to convince at least some people to get serious about conserving. People are fleeing from SUV's and pickup trucks (hence the dual financial train wrecks that GM and Ford have become), and likely being a little smarter about saving gasoline.
We still have a hell of a lot more conserving to do, low-hanging fruit just waiting to be picked, so this could be just the start of some really impressive reductions in gasoline consumption. There will very likely be some increased consumption in some months, but over a period of a year or more there's no reason why the US couldn't reduce its gasoline consumption by 10% without resorting to drastic measures or causing harm to the overall economy.

The lesson I take from all this is that the production graph up there is also a consumption graph. Leveling off may not necessarily be entirely due to production limitations, in the sense that it is becoming impossible to increase production, per peak oil dogma.

Now, clearly there are production issues (possibly in the future) or otherwise prices would not be as high as they are. But it is still possible that the immediate driver for the leveling off shown in the graph is due to consumption stalling more than production hitting a wall.

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Stuart Staniford on April 4, 2006 - 2:34am

You're correct that I'm reducing the moving average window at the edge, and that this will cause the curve to move in the future. It also moves in the future because the agencies revise their numbers. I still prefer this approach because it allows us to see the trend as clearly as possible given the data we have.

With all due respect to Lou, I think he's not paying quite enough attention to the seasonal issues (January is invariably the lowest demand month for gasoline), and the fact that this particular January was unusually warm means that demand for heating oil was sharply reduced.

As to your last two paragraphs. Obviously, the "production problems" cannot be mainly in the future, or stocks would have sharply increased (whereas they have only increased by about six days worth of production/consumption over the last two years). If there were producers who were able and willing to produce more, prices would not have increased so much, and demand would have continued to rise (given that the global economy has otherwise been doing well).

So I think we have to posit some combination of lack of ability or lack of willingness to increase production. (I'm inclined to think it a mixture myself - most countries can't increase production any more than they have, and Saudi Arabia maybe could but isn't trying very hard).

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Stuart Staniford on April 4, 2006 - 2:51am

I missed this comment of Lou's:

there's no reason why the US couldn't reduce its gasoline consumption by 10% without resorting to drastic measures or causing harm to the overall economy.

He means 10% in one year. That is completely implausible. Year-on-year gasoline consumption in the US has never dropped by anything like 10%, and drops in driving of only 2% have only come in the past with significant economic pain. Recall this graph:

Also, while US auto sales have started to shift, there's no sign of impact on overall fuel efficiency so far:

<small>
Vehicle miles traveled per gallon of supplied gasoline in the US. Source EIA and FHWA.
</small>

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Luis de Sousa on April 4, 2006 - 2:54am

The guy didn't read the Hirsch Report.

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louGrinzo on April 4, 2006 - 9:26am

If by "the guy" you mean me, you're wrong. I have read the Hirsch report, and I think it took a very shortsighted view of the transportation situation.

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liaozhi123 on April 27, 2006 - 3:57am

I don't agree with you!

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Richard on April 4, 2006 - 3:11am

Hold on, Stuart, you go too fast.

Did the drop in GDP cause the VMT to drop or the other way around?

There is some sort of relation between VMT and GDP increase, but unclear who does what, I would say.

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Stuart Staniford on April 4, 2006 - 3:22am

The big drops in the seventies were caused by oil shocks.

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odograph on April 4, 2006 - 10:28am

As opposed to "oil shocks" in our short-term future?

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Fletcher on April 4, 2006 - 5:54pm

Found the attached link at MotleyFool and the survey confirms my suspicions that driving behavior is more hard-wired that might even have been the case thirty years ago. The survey finds that %15 percent would not reduce their driving no matter the price of fuel; another thirty or more percent would not reduce driving substantially if the price were $6.50. I do not know the details of the survey, which, of course, are important and significant

http://www.fool.com/News/mft/2006/mft06040403.htm?logvisit=y?logvisit=y&source=estmarhln001999&a mp;npu=y

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Calorie on April 4, 2006 - 6:55pm

I wonder how many people are switching to a lower grade of gasoline, i.e. from Super/Premium to Regular. Last summer, after the hurricanes, a spate of newspaper articles came out suggesting that that could be done, in most cases, without any adverse consequences to your vehicle. Anecdotally, I easily convinced a couple of friends to switch to Regular for their Audis and BMWs.

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Halfin on April 4, 2006 - 7:45pm

These kinds of surveys are all BS in my opinion. Talk is cheap. Who knows what people would actually do.

The other problem is, they only ask how much less they would drive if gas cost more. People always say they wouldn't drive less. But they never ask how much more people would drive if gas cost less. I'll bet people would say they'd drive quite a bit more if gas were a lot cheaper.

In this survey, people said they wouldn't drive less no matter how much gas cost. So we should ask, would you drive more if gas were free? And I'm sure the answer would be, yes, a lot more.

The first answer makes it sound like demand is inelastic, the second answer makes it sound like demand is elastic. It can't really be both. They should ask the question both ways and average the results, to get a better estimate of true elasticity.

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GliderGuider on April 4, 2006 - 9:02pm

Here's a thought that might bear exploring in an open thread, but since the topic has been raised I'll start here.

I read a lot of discussion about the elasticity of demand for gasoline, but it's all couched in terms of the economic driver. That is, the only factor that is assumed to influence VMT or vehicle choice wrt to fuel efficiency is fuel price.

My interest, and one that seems very relevant to PO, is the role education plays in modifying demand elasticity. I'm a case in point. I could drive pretty much any car I wanted, within reason, and not worry about fuel consumption. Even quintupling the price would be more of a financial irritant than an impediment. However, education about either PO or GW seems to make people much less elastic in this regard, to the point that some of us stop driving for those reasons alone, not just the price. This same mindset seems to be working in a number of my acquaintances.

Does anyone have any thoughts on the validity of this observation, and does anyone know if any research has been done on these sorts of factors?

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jokuhl on April 4, 2006 - 9:32pm

Good question.

I'd say to that, look who's buying the Hybrids, who's putting PV up on their roof.. it might help them financially, and it might not, but it seems to be essentially done for prinicple at this point. ( I think it will bear out economically, as prices rise ) For people to change their driving habits means a huge leap of faith. I drive our daughter to a daycare 6-7 miles away. Not much, but it's frustrating since I used to walk her 1 mile, at a different age. But it's the right place for her right now. Which part of her future do I sacrifice for another part of her future?

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Agric on April 4, 2006 - 10:00pm

Demand elasticity will vary by person. There are many ways it may take effect:

car sharing
reduced shopping trip frequency
reduced leisure travel
substitution of public transport
walking
etc

Education does help, as does facilitation of substitution, but price is the most effective driver (sic). If you can afford a Ferrari then the price of gas is a trivial consideration, but what proportion of drivers can afford Ferraris? Extrapolate.

When does gas price pain hit you? $5, $10, $20? How about a shortage or rationing? Do they change your mindset?

Now imagine your wage is halved, or you lose you job, or your mortgage payment doubles.

Nah, don't be so silly, Agric, these things can't happen

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strandk on April 4, 2006 - 6:23pm

I think that the correlation between GDP and VMT is secondary rather than primary. In 1974 when the first oil shock happened, high oil price initiated stagflation by high commodity prices while high oil price discourages people from using motor vehicles much. The similar phenomenon can be found in 1979 & 80 when the second oil shock happened. Except for these two occasions, both GDP and VMT have increased at more or less constant paces in the last twenty years. If you note figures of GDP and VMT change in 1982, GDP decreased while VMT increased.

The definition of GDP has changed over the year because the government has changed the rules of GDP calculation to show rosy GDP figures to voters. Also in the last thirty years the component of GDP has changed very dramatically. In other words the financial economy has increased very rapidly in USA. I would assume that most of financial economy depends on the activity of traders and bankers. I don't think that their activity is very dependent on motor vehicle transportation.

Once I tried to do the same analysis for Japanese data. However, I soon found out that this analysis is meaningless for Japanese GDP and VMT. Japanese GDP increase had stagnated between 1991 and 2004. However, the number of motor vehicles has rapidly increased since the late 1980's. Therefore in this period VMT increased very rapidly while GDP either increased slowly or even decreased a little bit. Japanese saving rate is high. And deflation had kept their wealth intact. Therefore Japanese could buy nice cars without much economic activity increase. Therefore the correlation between GDP and VMT in USA data is not fundamental bur rather specifically for the situation of USA.

I remember that about 70-75% of oil is consumed for motor vehicles in USA while about 35-40% is in Japan. Since Japanese have more options for transportation than Americans, it would be easier for Japanese to reduce VMT without affecting economic activity than for Americans. However, the difference between USA and Japan is relative rather than absolute. I am sure that there is some room for US economy to decouple with motor vehicle usage.

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LevinK on April 4, 2006 - 1:58pm

Obviously it is a two-way relation. There are 4 scenariuos and only the more VMT -> more GDP causual direction does not make a lot sense.

IMO the correct word will be requires - a certain level of GDP requires a certain number of VMT. If GDP rises you need more VMT to support it, if you cut VMT (oil shock) you will get less GDP. If you cut GDP you will also get less VMT.

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Halfin on April 4, 2006 - 3:16am

If you extend that graph to January 06 though it should be up quite a bit, although obviously there's considerable noise from month to month.

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Stuart Staniford on April 4, 2006 - 3:26am

You're probably right, but it's not clear it's meaningful given the weather anomaly in January. Numerous commenters (when I originally posted that graph) pointed out that fuel economy is quite temperature dependent which probably explains most of the seasonal effects. To be sure an improvement is meaningful, we'd need to see a trend for at least a few months.

I don't doubt that fuel economy will improve in response to the high gas prices. I'm just pointing out that it hasn't really got going yet.

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Stuart Staniford on April 4, 2006 - 4:54am

Here it is: January is on the upside, but not to the point of being outside the noise.

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The Interloafer on April 4, 2006 - 2:42pm

January VMT declined in '04 and again in '05, only to surge back in '06 probably because of the warm winter. Interesting. I wonder how the rest of the year will fare.

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Halfin on April 4, 2006 - 4:54pm

Another thing I notice which is somewhat obscured by this graph is the year over year trend. The 2005 curve is above the 2003 curve in most places. So I assume that if you plotted this data on a yearly (rather than monthly) basis that we would have seen at least a small increase from 2003-2005 (not clear where 2004 would fit in). It would also be interesting to see the previous few years to see if there is a trend.

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louGrinzo on April 4, 2006 - 9:25am

First of all, I said "over a year or more", not "a year".

Second, I said "gasoline consumption", not "VMT". Some conservation from reduced VMT would surely play a part over time, but simply drving less aggressively would save most or all of the 10%.

Third, as for their being no change in the effective MPG so far: What would the fuel consumption and MPG have been had SUV sales not fallen off a cliff? What will the effective MPG be as this buying trend continues? As with VMT changes, a turnover in vehicles will clearly improve MPG over time, but in the short run a change in driving habits will provide a much bigger kicker.

Will people make these changes? Push up gasoline prices enough, and they will. Doomers (and I don't mean you, Stuart) keep telling us how PO will be an unprecedented event in human history, triggering economic and social armageddon, etc., but they never assume that people will take unprecedented steps in response. My view is that PO is very, very serious, but that the actions, both collective and individual, we can and will take to mitigate the effects of PO and peak NG are just as formidable.

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TJ on April 4, 2006 - 9:58am

If the required steps are truly unprecedented, then why would anyone assume they'll be taken? I look at the response to Katrina, and the state New Orleans is in, and I have to go with the doomers. As far as I can see, the response to a smaller challenge than peak oil is that the wealthy get richer and everyone else gets screwed big time.

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Robert Rapier on April 4, 2006 - 11:12am

I believe you are exactly correct (although some people will certainly resist making changes - demanding that the government save them from high prices). In fact, I am working on a blog essay along these lines. There will be pain, and probably an unprecedented hit to the economy, but I believe we will make it through. I think it is great that prices are increasing before the peak, because it gives everyone additional time to change their behaviors before change is forced on them.

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BrianT on April 4, 2006 - 12:15pm

Everybody is focusing on the USA. USA oil consumption has increased at a compounded rate of .42% a year since 1978. Essentially flat. China's continued growth in oil consumption is the 500 pound gorilla no one is discussing. China will determine oil prices down the road (and oil depletion), not the USA.

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Robert Rapier on April 4, 2006 - 12:47pm

Oh, China (and India) are both being discussed. They are a huge factor right now in the supply/demand imbalance. But my point is that since the U.S. uses so much more energy per capita, we certainly have the potential to cut worldwide demand by making changes as prices start to affect budgets. China and India will do the same. Just because they have aspiration to drive cars doesn't mean they will be able to afford it as prices escalate.

Make no mistake, I agree that we are in for some very difficult times. I just don't believe we are doomed. The current supply/demand imbalance, leading to higher prices, will push the peak further out.

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bombayduck on April 5, 2006 - 11:32am

Just a few points as my first post here.

Fantastic site. Keep up the good work.
My id shows you where I am and how I feel (Sitting Duck!!)
The price of petrol here in Bombay is about USD4.50 per gallon (Rs,50.00 per litre) Been this way for about six /eight months.
Our current economic growth does not seem to have been impacted with petrol at these rates.
we are putting about 1 million cars per annum
last moth saw the highest growth in sales of cars in the country. (will try and find a link)
I would not be unwilling to pay 2 ot 3 times the current price of petrol. (drive about 1500 km / month)
All our Rickshaws, Taxis and buses in Bomay, are run on CNG only. It is mandatory here.
I would really like to see a live chart of the world petrol /gas prices color coded for rate of recent rise. This would help us to see where the prices are going. If all of us provide the info for our own areas it would be possible to keep a good record of the rises as they hit. It will also reveal stress points in the systems.
I am now investigating ways to reduce my carbon footprint.

Just my 2 bits ;0)

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Stuart Staniford on April 5, 2006 - 8:01pm

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Cherenkov on April 4, 2006 - 12:00pm

It is a push-me pull-you world out there.

Many people do not have the luxury, at least short-term, to reduce driving much, but should they somehow manage to decrease driving enough to promulgate a significant percentage reduction in usage, then, given the nature of fungible markets, the supply will go elsewhere and the price will not be mitigated, particularly in a world where population continues to grow. In effect, that new population means a defacto increase in consumption, requiring new conservation. The cycle trends down from there. So far so good. Conservation is the goal.

But Americans may suffer disproportionally due to our enormous deficit and a world awash in our fiat excesses. Many countries, particulary in the far east, are waking up to this reality and they are already taking steps to multilaterally ease their pain.

I guess my main point is, there will be suffering no matter how you look at it. I am a doomer because I feel that the human propensity to cooperate is about as reliable as Microsoft Windows and because physics does not care what we do. A world defined by global warming is a system with mega-mega-mega tonnages of extra energy boiling up monster hurricanes and 351 tornadoes in a record tornado season that has barely started. That is some eight times the last highest number for this early in the season. The Ghawar's water cut keeps increasing and it is only a matter of time, a very short time, that the field collapses like the Yibal field did in Yemen. (Both fields have been using the same advanced water sweep and bottle-brush technologies for about the same period.)

I too wish that we could all just get along and hold hands and sing kumbaya and gently, gently lower the American behemoth of an economy into a swell post-oil paradise, but that is the kind of thinking that will cause the really intense pain. The belief that if we all stand on tippy-toe on the thin branch of human intent we can keep ourselves safe is a special belief often advocated by those who are heavily leveraged into the American dream -- too much to lose and not enough incentive to make the hard decisions.

What is it that Upton Sinclair said? I paraphrase at best: It is difficult to convince a man of a truth when his livelihood depends on his not understanding.

Happy talk, such as you might expect from George Babbit, is only cheerleading, not bread nor oil. We know where we want to get: a system that is stable and sustainable. Why not shoot for that right from the start? Why not use our fabulous intelligence and go-get-'em attitude to make it happen? That is the question that nags me. Everyone seems to agree that we live on a finite planet, but the arguments belie that fact. Technology is a product of cheap energy. Cheap energy is NOT a product of technology. So why do we think that building more widgets will magically slake the cheap energy thirst of an ever-growing population?

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odograph on April 4, 2006 - 12:24pm

I am a doomer because I feel that the human propensity to cooperate is about as reliable as Microsoft Windows and because physics does not care what we do.

LOL, I wonder how this breaks down by platform.

(moderate, Linux user)

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Leanan on April 4, 2006 - 12:31pm

Last week, Ray Ozzie, Microsoft's chief technical officer, was quoted by the NYT as saying "Complexity kills." Peak oilers are already using it for a sig.

(The full quote is, "Complexity kills. It sucks the life out of developers, it makes products difficult to plan, build and test, it introduces security challenges and it causes end-user and administrator frustration." Talking about why Vista is late, I think.)

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PhilRelig on April 4, 2006 - 12:47pm

That is precisely why I would have been perfectly content to use WordPerfect 5.1, which I essentially mastered 15 years ago while writing my Master's thesis, until the day I die. Instead, I get relentlessly pushed along by the inexorable "progress" of increasingly, yet largely uselessly complex Microsoft programs.

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mkc on April 4, 2006 - 4:27pm

I mastered GNU emacs 20 years ago (also during grad school), and I still use it every day. There are some new features, but everything I could do with it then, I can still do now.

Free Software rocks!

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ET on April 4, 2006 - 11:25pm

That's what Joseph Tainter says about civilizations.

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bjj on April 4, 2006 - 12:46pm

Moderate.

Believe:

Alternatives are a cruel hoax (for business-as-usual).
TPTB are keeping PO card close to the vest.
It's gonna be an 'interesting' (painful, etc.) decade going forward.
We will see a wide range of unexpected and effective responses to dwindling BTU/day.

Open source kinda guy.

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Stuart Staniford on April 4, 2006 - 1:16pm

A nice summary - that's more or less what I think too.

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DuncanK on April 4, 2006 - 6:55pm

Yup, that's pretty much "me too".

Our family has done a fair bit over the last year to reduce our energy footprint.

If there is a widespread collapse of mankind (which I doubt), I will be fighting tooth-and-nail to try and keep my family and myself alive.

Anyway, good to have the moderates speak up for a change!

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ryvr on April 4, 2006 - 7:39pm

We know where we want to get: a system that is stable and sustainable. Why not shoot for that right from the start? Why not use our fabulous intelligence and go-get-'em attitude to make it happen? That is the question that nags me.

I think that honestly we cannot proceed with these fixes because so very, very few people are willing to acknowledge that capitalism is a completely failed experiment. I have no doubt that they will when millions in the U.S. who were recently middle class are suddenly starving.

I believe that a wonderful human culture can live a fantastic life for many centuries to come in a sustainable system. However, capitalism **IS PREDICATED ON GROWTH**. Trying to keep the capitalism means having to keep the growth which means unsustainability, and extremely painful collapse.

I'm glad to see sustainability growing in support and familiarity to a broader range of people. Unfortunately, it is just a word if they cannot see that it is antithetical to capitalism.

We do have excellent options for economic systems based on cooperation and sharing (as opposed to competition and private ownership) that would make sustainability happen almost automatically.

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Stuart Staniford on April 4, 2006 - 7:53pm

"We do have excellent options for economic systems based on cooperation and sharing (as opposed to competition and private ownership) that would make sustainability happen almost automatically."

Errr - would you care to mention one such that's received a large scale trial?

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ryvr on April 4, 2006 - 8:01pm

I do wish I could. To work wonderfully, it would obviously take very intelligent and *compassionate* leaders and communities, which Stalin was not.

What has been tried honestly is capitalism, which is having the result of nearly destroying the planet's capacity to support human life. It is now time to honestly try a form of Marxism, which, as you point out, has not been tried.

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Agric on April 4, 2006 - 10:13pm

Agree your assessment of capitalism. But I have doubts on 'real marxism' being an appropriate solution, I think change needs to be more fundamental. Marxism is based on collective ownership of means of production and in free markets it has been shown to be less efficient than competitive capitalist systems. My guess is a shift in more innate human values is needed. I'm not exactly sure what that would be but it will mean the overthrow of current economic reality (which is doomed, anyway).

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Cherenkov on April 4, 2006 - 11:10pm

The Andalusian anarchists were a good example. They "ruled" the south of Spain from 1868 to 1903.

Cooperative societies were also common in American Indian tribes, in all of the Americas, and I'm sure I could find other examples like the Amana religious community, the Amish, Mennonites, Quakers and many buddhist communities.

Most people are completely ignorant of the many alternative governing methods that have graced this earth because they have never been spoon-fed that particular history. The job of the public school system is to confirm the legitimacy of the current government and not to point out its flaws and the success of alternate systems.

A brief foray into history will quickly convince anyone with an open mind that our history is the history of the victors. Should Hilter have won, our school books would be touting his politics. If Soviet style communism had overcome our consumer blandishments, then we would be getting their version of history.

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Stuart Staniford on April 4, 2006 - 1:10pm

Well, I agree with that comment, I just don't think 10% gasoline savings is likely without pretty noticeable economic impacts. Neither miles traveled or effective fuel efficiency has ever changed by more than a few percent in a year, and the large changes were always in the context of a big recession.

I'm of the view that it will take a pretty good-style recession to make people serious about conservation again.

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odograph on April 4, 2006 - 10:38am

He means 10% in one year. That is completely implausible. Year-on-year gasoline consumption in the US has never dropped by anything like 10%, and drops in driving of only 2% have only come in the past with significant economic pain. Recall this graph ...

Whenever anyone says something like "completely implausable" I'm reminded of that line form The Princess Bride ... you just think that because no one has ever done it before ;-)

Let's see ...

U.S. Finished Motor Gasoline Product Supplied (Thousand Barrels)

1978 - 2,705,308
1979 - 2,567,573 (-5%)

That's just one year, stretching it out ...

1978 - 2,705,308
1982 - 2,386,824 (-12%)

So we've never done 10% in one year, it's taken 5 years ... ah well, what's the point here, that we do it in one or that we do it?

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Stuart Staniford on April 4, 2006 - 1:19pm

Exactly. I totally agree it could be done in five years. Presumably the economic pain would be more-or-less similar to that in the period of 1978-1982.

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odograph on April 4, 2006 - 1:45pm

It could be done in any time frame, actually. What you are doing is assigning a probability based on past performance. FWIW, I generalize the market saying that "past behavior does not guarantee future performance" to include things like this.

I agree totally with those who question why a unique change (peak oil) should behave like past markets.

Here's the odd subtly though. I might join you in making a specific prediction, as the best possible projection from available data ... I just differ in the confidence I apply to that prediction.

In something as wide open as peak oil it is quite possible that the "best prediction" is still a "low probability event."

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Halfin on April 4, 2006 - 5:02pm

FWIW, I generalize the market saying that "past behavior does not guarantee future performance" to include things like this.

That's a great line. You could, in fact, build an entire philosophy of life around this principle.

As far as your point about predictions vs confidence: One of the nice things about the futures markets is that they not only give predictions, they give the error bars. JDH at Econbrowser showed the market's 95% confidence interval for future oil prices a few months ago:

http://www.econbrowser.com/archives/2006/02/oil_at_1530_a_b.html

The market is 95% certain that in 2010 oil will be anywhere from $14 to $251 a barrel. Now that's a heck of a prediction. I'll bet the TV shows would just be lining up to hire a pundit who gave predictions like that!

One of the most common human failings is overconfidence. People don't do that badly on predictions, but they're way too confident about being right. One of the great things about markets is that they are structured to overcome this flaw. As the example above shows, oil markets clearly do not suffer from overconfidence in pinning down future oil prices.

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odograph on April 4, 2006 - 5:43pm

It is important to remember that the error bars themselves are based on past performance:

The quarterly value of s is estimated from the 1970-2005 experience to be around 0.16, meaning a forecast of the real oil price a year from now would have a standard deviation of 40.5 x 0.16 = 0.32-- it's not that uncommon for the oil price to change by 32% on a year-to-year basis.

I think the economists writing and reading things like that are taking it with a grain of salt. They are smart enough to know that a projection based on the 1970-2005 experience is only valuable if (insert hocus-pocus) the world continues to behave as it has 1970-2005.

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Halfin on April 4, 2006 - 5:50pm

That's true, JDH estimated the 32% volatility based on the past decade's history. However there is another way to do it. You can measure what the market expects volatility to be in the future by looking at option prices and using a complicated formula, as he discusses at:

http://www.econbrowser.com/archives/2005/07/100_a_barrel_wh.html

This comes out to about the same result, a 32% volatility. So the markets apparently believe that volatility going forward won't be much different from the past 10 years (which have actually had quite high volatility, when you consider that the price has gone from 10 to 70 in about six years).

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odograph on April 4, 2006 - 6:08pm

Markets do not have minds, and cannot literally believe anything. The hidden message is what the speaker means when he says "markets believe."

I think the rational observer is using it as slang, with the expectation that if markets believe anything today, they can equally well believe anything else tomorrow.

That doesn't stop people from reading the tea leaves, and applying post hoc explanations to the market's every new "thought."

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Agric on April 4, 2006 - 10:31pm

You are hinting at somethings important but not leaping to their conclusion.

The MSM do portray markets as having rationale, minds, a queer kind of reason. They do it with a purpose: to make the markets a friendly and understandable thing to the naiive. It's 'personification', humans like it, check out their religions ;)

Whenever the various markets do something all sorts of pundits leap out and rationalise the move in a way that suits them. It is mostly post hoc nonsense.

I do believe that the markets move in mysterious ways, sometimes with uncanny awareness of what will come. I also believe that less visible hands are conjouring spells of significant power (money, as in repos, etc) that have fluence. Whatever ability the markets had for prediction has been sorely weakened by the fed-like shamans, you have been warned - the phase shift to reality will probably be sickeningly abrupt when it happens.

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ET on April 4, 2006 - 11:24pm

Halfin,
I notice that you often cite market futures as something of a reliable (more or less) predictor of the actual future. It seems to me that if you check the far-ahead (say 10 year) futures prices of a commodity like crude oil at various times in history that you will find the volatility of that futures price depends greatly on the current volatility of the market. IOW take a period of relative (!) stability in the crude market and you would find the 10 year future price maintaining close to the current price with a fairly narrow band of difference. On the other hand, in today's crude market, volatility seems high and futures predictions are pretty much anybody's guess. Hence the big spread. Altogether, I personally don't think markets predict things very well at all. I think they reflect current perceptions which are based on current volatility.

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Twilight on April 5, 2006 - 10:24am

The future will be just like the present, only more so. Just ask anyone.

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odograph on April 4, 2006 - 1:54pm

An illustration, you and I expect a "crunch" like the 70's as a likely scenario ... what happens to a scenario if true gasoline rationing become politically viable?

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Stuart Staniford on April 4, 2006 - 2:53pm

Then WWII becomes the closest analogue. GDP/mile more than doubled in the space of a year. Not too close, however, since the US is a very different place now than it was then in the morning of the auto-era (like we still had all our street car systems in WWII). However, I'm sure we could accomplish massive changes with a rationing program, if things get bad enough to put that on the political table.

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odograph on April 4, 2006 - 3:35pm

Picking a new analogue is a very human response ;-)

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odograph on April 4, 2006 - 10:40am

Sorry, my source is

http://tonto.eia.doe.gov/dnav/pet/hist/mgfupus1A.htm

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louGrinzo on April 4, 2006 - 9:10am

Excuse me, but as I pointed out on my site, and as Halfin alluded to, there was a (very) small drop in gasoline consumption. So that number isn't skewed by lower heating oil use.

I know plenty about seasonal variations--remember, I'm one of the other card-carrying economists around here, with more time spent studying stats and econometrics than I care to remember. I even have a minor in a foreign language: Greenspan.

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Stuart Staniford on April 4, 2006 - 1:25pm

It appears that what happened in January 2006 was that miles travelled went up a few percent, but that fuel economy was a little higher than usual (and went up more than driving went up) so gasoline consumption dropped slightly. That's most likely due to the fact that vehicle fuel efficiency is somewhat temperature dependent. Since there was no trend of increasing fuel economy at the end of 2005, we can't at this point rule out that January was simply due to the unusually warm weather then (which increased both driving and fuel economy, but the latter more than the former). On the other hand, if fuel economy starts to go up a little more in the rest of the year, maybe we'll end up dating the beginning of the rise to January. I don't think we can conclude anything about the trend at this point.

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The Swede on April 4, 2006 - 3:07pm

Stuart, why do you use such strange moving average periods such as 9 months and 13 months?? Whats wrong with 12months?

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Stuart Staniford on April 4, 2006 - 3:23pm

Well, if you want to center the window on the current month, and you used an even number of months, the window would have to be asymmetric - extending more into the future than the past (or vice versa). You can only use an even number if it's a trailing average. I don't like trailing averages as much because they are offset in time from the data.

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The Swede on April 4, 2006 - 5:30pm

Could you humour me and do a chart with a 12m trailing and your 9 and 13m? Just for fun?

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Fletcher on April 4, 2006 - 6:00pm

Me too; I could do with some humoring. I have always used trailing averages, but then I am a novice at statistical analysis.

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Stuart Staniford on April 4, 2006 - 6:35pm

Trailing averages are often used, but I don't like them because they don't go through the middle of the data, so it doesn't act as a useful smoothing function to help see the trend in the data. As you can see, this one is lagging six months behind the action.

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Agric on April 4, 2006 - 10:44pm

I am perverse. I must be, the 12 mth ma trail worries me more than the other curves. Perhaps my fossilised ma / curve / etc mindset just sees it clearer that way.

I do agree your philosophical preference for centered ma, and admit to surprise at my apparent preference for trailing, it could be because I have tended to use a weighted ma for things I have analysed.

Regardless, an upturn now would be a mite surprising, lol.

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Fletcher on April 8, 2006 - 11:17am

Thanks Stuart. Two thoughts, your centered averages are better at showing the data. But I also agree with Agric that in some ways the trailing causes more concern: it confirms the difficulty there will be in rising beyond this plateau.

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Calorie on April 4, 2006 - 10:47am

Lou, I was a bit surprised at your entry about January oil and gasoline consumption being down becasue in my recollection the weekly EIA petroleum reports that come out at 10:30 Wednesdays have been showing small increases in gasoline consumption. I guess I'm forgetting that there may have been some decreases in the January reports, or maybe the EIA updated the numbers later. However, consumption seems to have recovered in February (up 2.6%), according to a recent story in Resource Investor:

http://www.resourceinvestor.com/pebble.asp?relid=18338

Meanwhile back in the place that matters, American gasoline demand is still hot. To be fair in January it was not as hot as was made out. Revised figures from the EIA actually showed a fall in January of 48,000 bpd. So much for all the importance the market puts on those weekly inventory figures, myself included.
But now it is really picking up. February's gasoline demand was up 2.6% year on year, the strongest demand growth since April 2004. It is going to pull that light sweet WTI and Brent up by the nose. As a result the difference between Brent, in demand in Europe and the U.S., and WTI, mainly in demand in the U.S., has narrowed to 70 cents and less.

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odograph on April 4, 2006 - 10:57am

The easiest number to look at for me is the big one. The total yearly gasoline consumption actually dipped for the first time since 1990:

2004 - 3,332,579 (Thousand Barrels)
2005 - 3,330,805

We can provisionally call that a hurricane effect, somewhat, but if we think hurricane prices are going to be repeated this year ...

http://tonto.eia.doe.gov/dnav/pet/hist/mgfupus1A.htm

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Leanan on April 4, 2006 - 11:02am

Is it just prices? The hurricanes caused actual shortages in some areas of the countries. Not to mention those whose cars or jobs were washed away by the storms.

Though I suppose that could happen again this year, too...

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odograph on April 4, 2006 - 11:14am

I was leaving that as an open question, when I went from "hurricane effect" to "hurricane prices."

I've always tried to put no more than provisional explanations on past events. Reading Nassim Taleb has reinforced my distrust of post hoc explanations.

So, I provisionally see an economic downturn associated with the hurricane. I also see a large oil-burning response to the hurricane. I see a lot of oil-burning mirgration following the hurricane. How does it add up? I'd be a fool to try.

It's easier to be patient and see what gas prices do to consumption this year.

(I've seen premium over $3 in my neighborhood for the first time since the hurricane. The average price for regular has climbed here to $2.79. Post hoc explanations for these California prices abound.)

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Cherenkov on April 4, 2006 - 12:09pm

My guess -- two hundred angels on the head of a pin.

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odograph on April 4, 2006 - 12:22pm

Are you crazy? 197 at the most.

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Stuart Staniford on April 4, 2006 - 1:53pm

Why don't you keep your unconstructive snide remarks to yourself. They're really irritating. Some of us care. If you don't, you can just not read.

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odograph on April 4, 2006 - 11:23am

I should have mentioned that I saw this huge SUV downturn, and hybrid uptick, in the same timeframe as the hurricane. Do these signal a broader conservation attempt by consumers? Things like tobr>cannot be isolated. Certainly not with available data.

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Consume More on April 4, 2006 - 2:19pm

Broader conservation. I bought a hybrid, and I am the perfect average Joe. Exactly middle of the road. I represent a broad segment of the US population.

If I do something, millions of others are doing or will do exactly the same. We are the sheeple. I know it might sound as if I'm being sarcastic, but I am dead serious.

Other stuff we average Joes are doing: compact fluorescent bulbs at home, biking to Walgreens for prescriptions & etc., adjusting thermometer, shopping local farmers' market more often, growing vegetables in the backyard, buying only energy star appliances, replacing windows, composting, paying more attention to what we reuse and recycle.

Believe me, the number of people who will be doing all these things will grow fast.

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Consume More on April 4, 2006 - 2:28pm

Oh yeah, we're also laughing at moribund doomers like Cherenkov. We know he's way smarter than we are, but at least we're not always depressed. We sheeple will laugh through the dieoff. BAAAAHHH.

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PhilRelig on April 4, 2006 - 3:00pm

But if you read and post on this site, doesn't that make the idea that you are one of the "sheeple" rather oxymoronic?

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odograph on April 4, 2006 - 2:30pm

I tend to agree, but I know of no way to quantify my uncertainty.

Well, actually I know of one way to reduce my uncertainty, and that is to trust longer timescales. It is definitely fun to watch the data roll in (particularly this month's SUV sales data), but I try to remember that any one month (and possibly any single year) could just be "noise."

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GliderGuider on April 4, 2006 - 2:56pm

Another sheeple checking in here. Three years ago I lived in a suburban 3500 sq ft McMansion for two with a BMW 5er in the 3-car garage, dedicated to a classic use-it-once-and-chuck-it lawnmower lifestyle. Now I'm in a 1200 sq ft urban bungalow, drive a used diesel Jetta, bus to work, bike to shop, there are compact fluorescents in every fixture in the house, compost bins out back by the vegetable and herb gardens, and recycling bins in the kitchen. I have Kunstler, Simmons and Tim Flannery on the bookshelf.

I am sheeple, hear me baaa. We are waking up out here. Power to the sheeple.

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GliderGuider on April 4, 2006 - 3:00pm

PS - I still think we're all doomed. PO/GW packs a nasty knockout punch. But I'm damned if I'm going to die feeling guilty for not trying. And if only pockets of humanity are going to survive, we all need to make sure we have deep pockets.

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totoneila on April 4, 2006 - 4:05pm

Hello GliderGuider,

Good for you! Kudos and applause! Please keep spreading the Peakoil Outreach to all you can.

Bob Shaw in Phx,AZ Are Humans Smarter than Yeast?

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HTevC on April 5, 2006 - 2:19am

Yes, we should honor individuals who are actively powering down.

I'm in the process now with a 1,100sqf small village house and low energy footprint lifestyle.

Hoping that everything holds together for the next year or so to complete the transition. No, I'm not a doomer, but reading the data and seeing the obvious patterns developing as prompted my action.

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Halfin on April 4, 2006 - 5:05pm

I wish you doomers would stick to your own threads. This one is managing to maintain at least some connection to reality, thanks to Stuart's excellent use of hard facts and figures.

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totoneila on April 4, 2006 - 6:01pm

Halfin,

You are being impolite. You should be congratulating him for powering down, as I did. Everyone is entitled to the entropic energy beliefs of their choice. AFAIAC, as long as they refuse Denial and strive to understand entropy--that is 99% of the Peak Everything battle.

Bob Shaw in Phx,AZ Are Humans Smarter than YEast?

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Cherenkov on April 4, 2006 - 6:33pm

Entropy is immune from belief. That is the main problem with many who claim that we doomers are hunkering down and just waiting for the fall. Nothing could be farther from the truth.

It is my firm belief that if you keep holding out some fantasy techno saviour, you will lull the population back into their consensus trance. Why do that?

We know there will be a transition. The only question is do we want to start now while we have X amount oil or when we have X-Y?

I want people to start now. Not one day later. The only way to do this is to either scare the bejesus out of them, use government forces to do it, or simply let the placid teeming masses caught up in Hummer dreams march towards the cliff. Oh happy lemmings!!

And, by the way, I am extremely happy. The path to happiness lies not in the great American consumer fantasy but in self-reliance and local action. Traits that used to be associated with Americans, but no longer. Now, we demand the free lunch, no taxes, no guilt, and all covered in a creamy helping of cheap oil. I like the old American way. This new way is far too liberal. Damned namby-pamby republicans and their love of cheap oil. The current overwhelming fiscal irresponsibility of the Republicans is wonderfully ironic and simply mimics the typical American's feeling that they have an entitlement to their solar spendthrift ways.

Unhappiness will come the way of those who place bets that counter the iron-clad rules of physics. Touch the fire, you will be burned.

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Agric on April 4, 2006 - 11:12pm

Scaring doesn't work, only the sharp hammer blow will. Therefore all your doom post are doomed. But please keep on with your doomish posts, I like and appreciate them, the help me question and refine my perception and thinking.

I guess you noe (=intuitive know) by now that I share your bleak estimate of the future, Cherenkov. I don't think it inevitable, just highly probable unless we humans make the most massive change in our species history (and even that may not be sufficient).

Accept it: they are not going to start now. Even if they did there will still be great pain. Some mental phase shifts must happen, if they don't this species (humans) should die, if they do then we may survive to meet the next challenge.

Happiness has nothing to do with consumerism (that is just a clever delusion it would take me pages to fully explain), but nor is it very much to do with self reliance etc. Happiness and contentment are mostly an internal process, though having external aspects, it is quite easy for most people to be happy without the things they believe make them currently happy.

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DuncanK on April 4, 2006 - 11:14pm

"That is the main problem with many who claim that we doomers are hunkering down and just waiting for the fall. Nothing could be farther from the truth."

And yet all we seem to hear from you guys is "Dieoff is coming, so sit back and enjoy".

Do you have any idea how damaging to the PO cause this kind of crap rhetoric is? You say you want people to change, but you force them to view a future with no hope. Why would someone decide to change their ways when they are told that there is no hope?

Worse still, this kind of wild scaremongery makes the whole PO topic look like it is backed up by a bunch of nut-jobs. People will view your arguments the same way that we view the Abiotic Oil theory.

You want people to change now, but I'm afraid you have to realise that this supertanker called mankind cannot turn on a sixpence. If you try to turn the steering-wheel round with too much force, it will simply snap off in your hands.

We all need to apply gradual pressure in as many places as we can until the momentum builds and wholesale changes get the ship turning smoothly.

Anything else is a waste of time and effort.

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Cherenkov on April 5, 2006 - 12:00am

Duh, Duncan.

That means applying that pressure NOW.

Don't put words in my mouth unless you understand the concept of sarcasm. Nothing is more disheartening than to have an argument with someone who lives in literal world. It's like having an argument with a child.

My thesis has always been the change is coming and the sooner we do it on the best possible terms the better.

I would sure hate to scare someone standing on the train tracks and scream at them to get the hell off the tracks. Far better to whisper and make coy waving motions. Scaremongery is not a word, but I get the drift. The problem with calling someone a scaremonger is that the scaremonger must be drumming up fear over something that is not true. Either you are a cornucopian or just a someone who is not well versed in the art of argument.

Yes, it is a supertanker. DUH. But, if you want to turn the thing you better start now. I have even used this image before in my posts. The sad thing is you have read your thoughts into my message and mangled it badly. Another example of poor rhetorical skills.

Yours is an attitude that will sink the world -- the idea that we just need to sit around and figure out a new way to continue the old paradigm.

This is magical thinking on your part bub. Physics is not about your touchy feely weirdness. Physics just is.

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Stuart Staniford on April 5, 2006 - 12:38am

The problem is one of credibility. Those of you who believe (or say) we're all going to die look pretty unbalanced from the perspective of those of us who believe peak oil may well be soluble (with a good deal of pain). And you no doubt look utterly insane from the perspective of someone in the mainstream. So the mainstream reaction to your jumping up and down warning them is not going to be to take you seriously, but rather to conclude you're a lunatic and tune you out of further consideration.

I have yet to see anyone make the "we're all doomed" case with any kind of solid quantitative reasoning. What exactly is the critical resource (or combination of resources) that will be limiting of the human population, how much of it is there, and how do we extrapolate it into the future in such a way that we can be confident there is no escape, and that no combination of innovations and substitutions can solve the problem. I've never seen anyone even try to make an argument like that.

All I've seen is handwaving - English professors telling us that they have the true understanding of the implications of physics (without writing any equations...), or laywers telling us that only their understanding of sociobiology can lead us to a correst assessment, and the rest of us must be idiots for not seeing the truth as clearly as they do.

An important (to me) way that I judge people is by their "permeability to evidence". That is the human tendency to change their views when contrary evidence shows up. People who are deeply stuck in some psychological script of their own (often from childhood experiences, but sometimes from a societal paradigm) that they aren't conscious of see the world through some kind of distorted lens that makes it very hard for them to absorb any evidence that will change their mind. Some are rabid optimists and cannot accept that anything bad can ever happen to human beings. Others are rabid pessimists who feel that we're all doomed and there's nothing that can be done about it.

The appropriate reaction to a new piece of evidence or a new possible technique is a sense of curiousity, and a desire to know more about it to see if this changes the picture or not. If instead, you find that your first reaction to a new piece of evidence or technique is a sense of discomfort and a casting about for ways to discredit it, that suggests that your permeability to evidence is rather low.

I think people of low evidence-permeability are not helpful in solving problems. Regardless of the particular script they are stuck in, they make things hard. They burn witches, ban books, commit genocide, fly planes into buildings, invade countries for false and foolish reasons, ignore and deny important problems until very late, and then make unsupported pronouncements about the solubility or otherwise of those problems.

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totoneila on April 5, 2006 - 2:04am

Hello Stuart,

Please read my post of Tues APR 4 @12:20 EST on the thread "NYC: Best Place for $100 oil? Maybe..."

Your quote: "An important (to me) way that I judge people is by their "permeability to evidence". That is the human tendency to change their views when contrary evidence shows up."

Now I am no computer guru nor a statistician, but I too agree with your quote. I am going to try & see if there is some way to quantify the concepts briefly described in my posting, but it seems intuitively obvious to me. I gonna flail away....I shall return.

On another forum, I generated a posting with a huge number of ratios and variables that hopefully could be used to predict Duncan's Olduvai Gorge, but nobody volunteered to statistically evaluate it for me. Yet, I suspect the CIA/NSA routinely uses supercomputers to generate all kinds of scenarios and wargame simulations.

Bob Shaw in Phx,AZ Are Humans Smarter than Yeast?

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totoneila on April 5, 2006 - 2:46am

Hello TODers,

Just a quick glimpse at some of the research directions I hope to be heading to: KAROSHI, Death from Overwork. I believe as the downslope really kicks in, there will be a massive shift to increased hours of manual labor to replace the luxury of machines [optimistically? thinking society will still prefer work to violence].

http://www.workhealth.org/whatsnew/lpkarosh.html
----------
The first case of karoshi was reported in 1969 with the death from a stroke of a 29- year old, married male worker in the shipping department of Japan's largest newspaper company [1]. Karoshi can be translated quite literally as "death from overwork." The major medical causes of karoshi-deaths are heart attack and stroke, including subarachnoidal hemorrhage (18.4%), cerebral hemorrhage (17.2%), cerebral thrombosis or infarction (6.8%), myocardial infarction (9.8%), heart failure (18.7%), and other causes (29.1%) [2]. The Ministry of Labor began to publish the statistics on karoshi in 1987, as public concern increased [3]:

For example, a big life insurance company investigated 500 male white-collar workers in top-ranking corporations in Tokyo. The report shows that 46 percent of respondents were anxious about their own risk of karoshi. A quarter of them experienced complaints from their families related to anxiety about karoshi. Around 5 to 20 percent of the workers themselves were afraid of the high risk of karoshi. This fear increased with age. The report also shows that family members are much more afraid than the workers themselves. Nowadays, there are almost no workers who do not know the word [karoshi]. Many Japanese workers and their families are anxious about karoshi.

There are no epidemiologically sound estimates of the prevalence and incidence of karoshi. Until recently, there were 20 to 60 deaths each year from overwork for which the Ministry of Labor awarded compensation. However, critics state that the number of people the Ministry compensates for such deaths is much less than their actual occurrence [4]. The overall number of deaths related to cerebrovascular or cardiovascular disease in the 20 to 59 age group is around 35,000 per year according to vital statistics data. Kawato estimates that one-third of these are work-related, or more than 10,000 each year [4]. In 1994, the Japanese government's Economic Planning Agency in the Institute of Economics estimated the number of Karoshi deaths at around 1,000 or 5 percent of all deaths from cerebrovascular and cardiovascular disease in the 25 to 59 age group [5].
---------------

This is all occurring during the cheap energy upslope when optimism reigned in Japan. Will this deathrate triple, quadruple, quintuple, etc, on the Hubbert Downslope? How will Americans, already in poor physical health, medically react to a massive increase in arduous labor?

Bob Shaw in Phx,AZ Are Humans Smarter than Yeast?

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Stuart Staniford on April 5, 2006 - 3:24am

A massive increase in manual labor might be a good thing for the health of Americans, since we are becoming obese at explosive rates currently. According to the Community Solutions Video, Cubans lost 30lb on average when Cuba lost 50% of its oil supply, which can only be good for their health (the video emphasized the improved health of Cubans, actually).

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DuncanK on April 5, 2006 - 5:04pm

500 male white-collar workers in top-ranking corporations

Office workers! Exactly the kind of jobs that are most likely to disappear post-peak.

And it's not what I call "arduous labor". I use arduous labour in my graden to relieve my stress.

The kind of stress that office workers deal with is very bad for your health. Deadlines, office politics, and other workload factors signal the body to produce adrenaline, the "fight or flight" hormone.

But we can do neither of these in an office situation.

After prolonged stress levels, the adrenal glands become exhausted and the brain signals the release of the hormone cortisol.

Together, this prolonged mix of toxic chemicals takes an incredible toll on the body.

Another reason why a post-carbon world will be better for us.

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gettingwarm on April 5, 2006 - 7:28am

Stuart is right on. Doomers would have more credibility if they focused on nations who have survived PO-like situations:

Switzerland and Sweeden during WWII

Cuba post USSR

Russia post USSR

It is hard for my brain to go from Stuart's wonderful fact-based graphs (crack for PO'ers) to opinion-based Doomers.
Very helpful are the powerdown stories.

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Don Sailorman on April 5, 2006 - 8:28am

Stuart,
Very well-stated! A+

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Twilight on April 5, 2006 - 10:43am

I agree completely. We all have our opinions of what may come, but must one be open to the evidence, whatever it shows. I certainly have ideas about what I think is going to happen, some strong and others not so. I have to go with what I see, but I have been quite mistaken about several things already. For example, I moved my 401K from stocks to bonds a couple of months ago, as I thought I saw signs of pending problems - I've gotten trounced in that move.

And as far a preparation for the coming future goes, I think the single most important skill is to have an agile mind. The faster one can recognize and adapt to changes, the better off one will be. If you are preparing for a future that is not going to happen, you are at an extreme disadvantage.

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LevinK on April 5, 2006 - 10:52am

I'm stunned. This is the best summary of the credibility problem I've seen. I also call it s flexibility of views - which is a derivative on the level of conciousness.

I can just add the following: it is normal that at the moment you receive new information contradicting your current views to you resist accepting it. Denial is the first reaction to anything chaning the status quo. But if you are critical and inquisitive enough you can overcome that phase and actually expand your views and correcting them eventually after some iterations (in TOD for example). The most important and hardest point is to identify yourself being in denial, after that it is easy.

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clifman on April 5, 2006 - 11:57am

"I've never seen anyone even try to make an argument like that."

Stuart,

How about Catton? He makes a pretty compelling case that we're living on ghost/phantom acreage, either importing food from somewhere else, or consuming sunlight from somewhen else, and that since we now have a population dependent on a spectre, as it disappears, so must many of us. Tie in what Lester Brown has to say about water depletion (even though aquifers recharge, we can tax them well beyond that rate, and suddenly have an unsupportable situation when we need 90 units of water, but the recharge rate is only 10...) and the whole energy/water/food equation seems highly unsustainable, and as much as I appreciate and practice conservation, efficiency, renewable and organic approaches, it seems pretty clear that even in concert they can't replace the "productivity" that fossil fuel and fossil water extraction temporarily has allowed us.

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AlanfromBigEasy on April 5, 2006 - 12:27pm

Permeability of Evidence

I have studied (informally) the impact of Urban Rail on cities (mainly US but also others). I had concluded (say in early 1980s) that it was "enough" to build a decent Urban Rail system in a growing city (shrinking or stable is another matter) and it woudl start to grow around it. TOD (the other one) woudl entice growth there.

Seems to be working well in Dallas & Portland, less so in San Diego but sort of, etc.

That was the limit of my ambitions. In New Orleans, the "next" streetcar line.

Then I clued into electrified intercity frieght (with some pax) railroads. An easy solution taht made sense.

I still see building all of the "on the table" Urban Rail that cities want + electrifying major railroads as Step 1.

New cities will want Urban Rail when others get theirs IMO.

But is this "enough" ?

Add hybrids, small diesels, less plastic waste, more bike lanes, and other easy steps.

Closer for sure.

Tar sands, coal to liquids, remote natural gas to liquids, ?

Maybe.

I do NOT know if this strategy will work out for the next 20 to 30 years. More may be needed. The number of unknowns exceeds the number of knowns, which makes for an insoluable problem. The number of assumptions required for the unknowns in order to find a solution is so large that some are surely wrong. So I see Peak Oil as a "wrestling with jello" problem.

However, I am quite clear about what needs to be done in the next few years in the US and will concentrate on that.

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DuncanK on April 5, 2006 - 10:02am

Duh, Duncan.

Come, come Cherry. You can do better than this! Writing like a teenage girl is not very becoming :-)

That means applying that pressure NOW.

Ya don't say! And I thought we had to do it next year! Silly me!

The sad thing is you have read your thoughts into my message and mangled it badly

Which is something you seem to be very good at:

Yours is an attitude that will sink the world -- the idea that we just need to sit around and figure out a new way to continue the old paradigm.

Please point me to any comment that I have ever written here on TOD which states that everything is just fine and we can carry on with business-as-usual.

You see, this is the trouble with your kind of attitude.

It's the "either you're with us, or you're agin us".

I do not buy your mankind collapse arguments, therefore I must be a cornucopian, business-as-usual, energy-hungry consumer. QED!

Masterful reasoning, Cherry!

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GliderGuider on April 4, 2006 - 6:42pm

We're not all statisticians, Halfin. It seems to me that the point of producing data like Stuart's is not just to get the numbers right, but ultimately to have an effect on the world and the behaviour of those in it. My contribution to the quantitiative side of the discussion is necessarily limited - I'm not a producer of this sort of information, I'm a consumer of it.

The aggregate of the analysis I've seen on this site over the six months or more I've been lurking has validated the shape of Stuart's graph and the story it's telling - the Peak Oil plateau is here now. That appreciation makes reacting to the data (as distinct from further validating it) a matter of some urgency. My contribution, therefore, is to assure those of you crunching the numbers that your efforts are having some effect on people, and thereby to encourage you to keep doing it.

The numbers exist not of and for themselves, but to goad people to action. Whether I'm a doomer on the global scale has little significance. The important thing is that the numbers are now believable enough that I'm willing to make real-world changes in my life because of them. I'm convinced that the more of us that do do so, the more of us will survive, which is a far cry from throwing up my hands and wailing "All is lost!"

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Dragonfly41 on April 4, 2006 - 11:49pm

I am beginning to measure how close we are to PO by the level of tension and frustration in my social environment. As displayed in recent threads here at TOD, that level has risen markedly in the last month or so.

This pattern is also repeated in my work environment as of late. People are on edge and quick to start a conflict for unfound reasons.

Of course, staff reductions and work reorganizations do not help.

Just an observation.

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Twilight on April 5, 2006 - 12:18pm

There is certainly more tension on TOD lately, but then the number of posters and comments are going up a lot too. I have always found that as any organization increases in size, the noise level eventually gets to the point where it is unworkable. Anyway, I'm not sure if what your seeing on TOD is due to impending problems re PO, or just due to growth.

There is a general tension among people I know as well, a sense of things going wrong. I think it is more due to economic and political concerns.

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Dragonfly41 on April 5, 2006 - 10:59pm

I attribute it more to the obvious signs of entropy in our daily systems. Things that used to work fine, aren't working quite as well any more. Yes, they are due to economic and political concerns. But what is causing the economic and political concerns. The slow realization that we can't hold it all together like we used to. Some systems that required cheap energy to maintain are being forfeited in the name of cost-cutting.

This could be something as subtle as less people at the call centers causing longer delays when trying to get assistance for troubleshooting an issue with your PC.

Just a little more frustration thrown into our daily lives because the company could not afford to keep the call center staff it did a year ago.

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Agric on April 4, 2006 - 10:50pm

This planet needs more sheeple like you ;)

And you have probably made more change in three years than most puffed up enviromentalists.

So, what made you change? can we 'bottle' it and infect other sheeple with it?

Why are you awake?

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GliderGuider on April 5, 2006 - 7:34am

Stuart's "permeability to evidence" played a big part, but circumstances supplied the rest. I don't recall where I first heard the term "peak oil", but I do recall that I had to go searching for information on it back then. I'd read "Limits to Growth" and essays on Malthus back in the '70s, so I was primed with the underlying concepts. From that perspective a lot of us ex-hippies will be fertile ground for the Peak Oil proselytizers, and the meme is now mainstream. There's been a lot of progress on that front in the last couple of years.

In terms of how to get the message out to the marginally receptive, words and numbers won't do it on their own. We're a visual species, and the one mechanism I've found most arresting is charts and graphs. Every time I see one of Stuart's big green graphs I stop and read very carefully. I've had more "Oh shit" moments from looking at graphs than from anything else.

One more thing that the movement needs to do is to develop a succinct sound-bite to counter the notion that it's the all the fault of profit-gouging oil companies. People notice the pump prices, but as was said earlier, their initial reaction is usually one of "damn oil companies". While it doesn't help that ExxonMobil is now the richest company on the face of the planet, we know that PO isn't their fault. I'm still trying to find some way to get this notion across to others without having their eyes glaze over.

And one more comment about doomers - there's a subtle but huge difference between "We're all going to die, nothing can be done", and "The scale of the problem is so vast and its implications so severe that many of us will probably die. We need to minimize that number as much as we can." This probably shouldn't be the first concept you hit a prospective PO convert with, though...

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Leanan on April 5, 2006 - 9:02am

I like charts and graphs, too, but not everyone does. In fact, it's my experience that many, perhaps most, Americans cannot understand graphs. Those of us in sci/tech fields use them so often, we tend to forget that others do not.

Different people use different methods of communication. I suspect most of us are trying to help, and we spreading the word in the way that worked for us. For some, fear and apocalypse is the best way to reach them. You have to admit, it draws attention that dry charts and graphs do not.

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Seadragon on April 4, 2006 - 9:53pm

I'm not familiar with your particular species of sheeple, sir. The ones in my area aren't nearly as enlightened as you seem to be. Blaming the oil companies is the usual behavior. If you're really up to speed here you might think that ethanol will save us. Noone really understands the concept of powering down here in the world capitol of ignorance.

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AlanfromBigEasy on April 4, 2006 - 11:14pm

Various observers may have noted how large a part Urban Rail played in the plans for a new New Orleans. Next to restoring our wetlands and decent levees, they were the #3 priority.

I was part and parcel of this planning effort. The attitude of ordinary people of New Orleans attending these planning sub-sub-committees was QUITE positive again & again.

We "Get It" here and asked for $3 billion in new Urban Rail. We are likely to get only $1 billion now, but the die is pretty well cast.

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magwitch on April 5, 2006 - 12:21am

I may never travel to New Orleans, but I still have to say, Thank You, Alan. You're doing very important work.

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The Swede on April 4, 2006 - 3:06pm

The switch from SUVs to hybrids must be negligable on the whole. US SUV/light truck sales contracted by a mere 0.8% in 2005 to 9.3 million cars (minus 75000 roughly), according to Autodata.

At the same time hybrids had a record year with sales of 0.206 million cars representing 1.2% of the total passenger car sale of 16.95 million.

The effect of using the more fuel efficient of your two cars must be bigger, in the short term.

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“Where ideas are concerned, America can be counted on to do one of two things: take a good idea and run it completely into the ground, or take a bad idea and run it completely into the ground.”

—George Carlin