The Oil Drum

Thanks Stonleigh,
There is lots to chew on there.
After almost three years of trying to sort out the issues and develope a focus from the peak oil discussion I have sketched out some conclusions for the immediate future. These are based upon reading all of the pros, cons, predictions etc mostly on TOD, Energy Bulletin and ASPO sites. I am not making predictions but trying to come up with a realistic idea of what to expect in my lifetime (next 20 years). I am pasting the first bit of it below but the gist of it is to look for signs of and prepare for an economic recession. Past this first recession everything becomes more speculative. And all of the ponts below are subject to revision at any time.
1- The immediate issue is economic recession rather than peak oil however an oil crisis may be the trigger of the recession. Knowing the likely starting date of the first significant recessionary episode is more critical than knowing the date of peak oil.
2- Canada is unlikely to go into recession before the USA however Ontario could lead us into recession if the big three auto companies decline significantly.
3- Peak oil will be fixed in volume but its impact hidden by economic down turn. The point of peak oil is that once it is reached (or caused by the initial recession) the world will never see another era of wealth and growth as was the last half of the 20th century. However most of us will have to deal with the chaos of the transition and decline. The end result will be left to our grand children and their children. Whatever human world results will be of their making, baring a nuclear war or climate change totally re-writing the rules as our last selfish gift to them.
4- The price of oil/gas will drop dramatically as there are dramatic demand drops caused by the recession. Even though there will then be adequate supplies for demand oil will remain priced out of common usage for many of us destroyed by the recession.
5- The price drop will shelve most of the expensive E&P projects for years and they will never again be able to catch up production to (2006?) peak levels. This will severely retard deep water and tar sands development as there will be plenty of more conventional oil to fill demand. However as the years pass declining production will accelerate making attempts at economic recovery shallower and shorter.
6- Peak natural gas may be more visible and have more immediate impact than peak oil as it may manifest in spite of an economic recession. Natural gas may see enough of demand destruction to add many extra years to its reserves even at very low exploration and development rates but will gradually be priced out of the low income end of the retail market. Unless this recessionary cycle is delayed the Mackenzie Valley pipeline will never be built.
7- Central governments will persist for some time as there will be sufficient energy and money for them to exercise control. This phase may have several cycles before the more long term manifestations per below. Choices at this point, probably in the first deep recessionary episode, will determine if we follow a less chaotic path or descend into the darker one below.
8- This may be the point where nations will be willing to sign onto rational solutions such as the Oil Depletion Protocol and make brave decisions to rework our economies into sustainable ones. We must hope they do and we should work towards this goal of retaining some central authority and benign rule of law. If not …
9- The pace of the political evolution will be related to the speed, depth and persistence of the first waves of recession.