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52 comments on Countdown to $200 oil (12) - betting on Yergin
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Jerome,
I'd like to see your countdown delayed until the US and Europe can get off of oil. Fairly rapid demand reduction would need to occur to see this happen. Do you think Europe would be interested in essentially eliminating oil use over the next 15 years or do you think the oil interests are too powerful to allow setting such a strong policy?
Chris
Do you think Europe would be interested in essentially eliminating oil use over the next 15 years or do you think the oil interests are too powerful to allow setting such a strong policy?
I bet everyone is interested in essentially eliminating oil use over the next 15 years. Much easier said than done. In fact it would likely be impossible even if the world thought there was a problem. Besides cars and trucks, you have airplanes, ships, farm machinery, construction equipment, pesticides, asphalt among even more uses of oil. And since the world for the most part has still not even reached the first stage of a solution - realizing there is a problem - getting off oil in 30 years seems an unrealistic goal.
I concur with the opinion that weaning ourselves off oil, or at least fossil fuels in general, is not going to happen within 15 or even probably 30 years.
One additional factor however is, in my opinion, it has been found recently that we have a whole lot more natural gas in the US than previously thought, due to the fact that we now know how to tap into the "unconventional" sources like the "shales" (Barnett shale, etc)
Probably the stupidest energy strategy is to do nothing, in which case it won't be long before we are paying 4,5, 10 dollars per gallon for gasoline. As was pointed out in the original post on this thread, even with demand dropping in an economic downturn, supply will be dropping even faster based on the very rapid dropoff in oil production of existing fields that all analyses have been projecting.
A somewhat better strategy is if we start switching over our ground transportation system to natural gas. If we can do those as hybrids, all the better.
Once we did that we would probably be able to continue, as J Kunstler likes to put it, "happy motoring", in my opinion for 2-3 more decades. I agree with a lot of his assessment of what we may be facing in the future, but I think his time frame is way shorter than the way things are actually going to play out, particularly due to all the natural gas supplies that we now have in the US.
What about other countries? Not sure. They may be able to do a similar scenario relying heavily on LNG from places like Qatar.
Anyway, my view is the peak fossil fuel crisis is certainly coming, but it may very well be posponed a couple decades on account of natural gas.
Ironically, we may have a severe transportation fuel crisis in the next 10 years or so, not because of the time lag to switch over to renewables, but because of the time lag to switch over to natural gas.
What about electric cars? Well, if better batteries are perfected fast enough, maybe we can switch over to those in nearly the same time frame as a switchover to natural gas vehicles.
But functionally a natural gas vehicle will be very similar to a gasoline one, a little crummier because of the large tank, but otherwise about the same. Getting the same functionality out of a pure EV I think may still be quite a ways off.
Of course, if we didn't have fossil fuel vehicles, we would certainly settle for whatever we could get, people would certainly drive something along the lines of a battery powered golf cart than not have a personal vehicle at all. But, so long as there are fossil fuel vehicles to be had that aren't prohibitively expensive to run, which I believe will be the case for natural gas cars for several decades, people are liable to prefer those.
Unfortunately, that means we may wind up with a long period of complacency driving our natural gas cars instead of gasoline cars.
That era of course will eventually end as well. If society is smart enough to continue to improve EVs during that time, then perhaps they will be able to make a fairly painless switchover.
In terms of switching over to renewable energy in general (not just with regard to vehicles), I believe we are looking at about a 100 year transition.
When I talk to lay people who are renewables buffs they think I am nuts to believe it will take that long. However, when you look at the writings by experts on renewables, they talk in terms of goals like 20% of our electricity from renewables by 2020. If we just look at electricity, one would figure, well we ought to be able to do the remaining 80% a lot faster than just at a linear 1% more per year, which is the rate we would be going at if my 100 year hypothesis proved to be correct.
However, I think that there are some important challenges that most renewables advocates, especially those without science or engineering background, fail to recognize.
If to have a renewable electric grid all we had to do was replace all our existing power plants with wind and solar generators, then the switchover indeed could be quite fast, because economy of scale would allow us to ramp up our renewables sources at an exponential, not linear rate.
However, once we reach a certain percentage of renewables, the intermittency problem starts becoming a real thorny one. I saw a discussion on TV from some conference in Seattle recently and one utility guy seemed to be contending that the way you deal with intermittency is you simply change the price on a minute by minute basis. When the wind is blowing you buy your electricity dirt cheap, when the wind is not blowing and the sun is not shining then you pay through the nose.
I guess that's one approach, although not one that is likely to be too popular unless there is no alternative, the alternatives being as far as I can ascertain either 1). huge energy storage facilities or 2). a massive highly-efficient global power transmission system (I believe Al Gore is a proponent of the latter).
The technology does not yet exist for either of those. The second of the two not only has technological challenges; geopolitical considerations might also be a show stopper for that one.
Then of course the other big problem with transitioning to renewables is that not all end-uses of energy can run on electricity. The most commonly cited example, of course, is aircraft. If we're lucky, we may be able to produce enough biofuels for those things that absolutely need hydrocarbons.
Anyway, a renewables world is a long ways off. But for those who think we can get there a lot faster than I do, I think we can all agree on one point. We need to develop them as aggressively and quickly as possible.
One disagreement. You discount the Realtime market for electricity as a nearterm solution to intermittency, apparently on popularity grounds.
You need to revisit your incorrect assumptions, whatever they may be. Modern digital control and communications technology can make all this operate invisibly in the background for you. It can be done cheaply (eg. <$5 / month / point) and be repaid by giving every customer direct access to the wholesale electrical market, where electricity sells on average for less than half what retail customers pay and in off-peak hours could charge your EV essentially for no noticable cost, eg. <$0.01 / kwh.
That system is the real fix for intermittent renewables.
It should also be noted that the very times when electricity is the most expensive on the wholesale market, because everyone is trying to buy it, (4 pm on a hot summer day) is exactly the same time that solar panels tend to be producing a lot of power. When the sun isn't shining, electricity use is actually a lot less "naturally." And sure lighting does use some power, but far less than AC or heavy industry or buildings that have to have the lights on because they don't have any windows. And most of those use power in the day, not at night.
Getting access to the wholesale pricing schedule is what makes solar panels a lot more cost effective. For instance, I sell the power produced by my solar panels at 13 cents/kwh in the middle of the day when I'm not even home to use it, and then buy power at 6 cents/kwh late in the evening to cook dinner. Not only can I use a lot more power than I produce, and still only have to pay the metering charge, but the power company is making money on this arrangement too.
“Do you think Europe would be interested in essentially eliminating oil use over the next 15 years or do you think the oil interests are too powerful to allow setting such a strong policy?” Posted by mdsolar
Not gonna happen, not in Europe, America, or any industrialized economy, nor in any of the “emerging economies” that have recently caught the “economic growth” virus.
There are only two ways that I can see to cause this level of demand destruction, 1, a kickass worldwide depression, or, 2., some decades from now when the great oilfields are but carcasses, strewn with no more than stripper wells. In the depression scenario, oil could be $5 per barrel, but in a depression, everyone is pretty much broke, and $5 might as well as be $500.
One thing I’ve always been curious about, and maybe Westexas or Robert or one of the oilmen here might know, and that is how long is it realistic for any oil to be produced? In 100 years, is there any chance that places like Ghawar and Texas could still have maybe numerous stripper wells still producing? In 1,000? Or will all production have faded away sometime in the next century”
Antoinetta III
We cannot eliminate oil use. Not in the US, not in Europe. Everything we do, everything we have and everything we eat requires oil & ng. Fertilizers, plastics, elastics, nylon, polyesters, condoms & even the pill. People get food from supermarkets, money from jobs transporting things & baking air.
All over the 'globalized' world, we need constant and preferably rapid growth to keep the system going: only growth can promise affluence for everyone.
Inverse growth or contraction will cause a major fight over remaining resources: witness the glorious way the good old boys are 'privatizing' the next x-ty years of taxes.
We all know the world isn't ruled rationally. But in this globalized world, everything is connected to everything, and all of its systems are at full capacity or over.
Even if global warming wasn't there, we are doomed to worse than unpleasant times. And as for global warming, I can only hope for fast and furious demand destruction of fossil fuels. Faint hope...
The next bit is misery followed by death.
sorry.
FFS.
Would you like to tell me which fertilisers come directly from *oil*. Not natural gas, but oil?
Would you like to tell me just what percentage of oil goes into your laundary list of other products - is the entire output of Gwahar required for the pill? Would oil increasing in price by a factor of 100 affect the manifacturing costs of condoms much?
And, of course, how many of these uses are absolutely non-substitutable, even given that negative EROEI oil sources are prefectly OK as a source of industrial feedstocks?
Have you put even the slightest thought into this subject? Learned any science outside of the Offifial Doomer Line (tm)?
Subsitiution of static Oil and Gas use (Heating, some electric and feedstocks) is a relatively trivial problem to fix; Nuclear power with climate-appropriate renewable contributions can fix this on century-plus timescales. Substitution of transport varies in difficulty; most commuting a local travel can be substituted with EVs with current technology; Air travel and long distance haulage are the harder problems.. but we'll have enough oil for them for decades to come.
There is no particular reason why we need fast growth, this is not the requirement for debt repayment as commonly asserted here (you forget inflation).
Try to be critical of anything you read that agrees with what you already think.
excellent. the (tm) is priceless.
Also correct in every sense.
Did you ever calculate how much effort, design, advertising, packaging and transport go into your ergonomically formed throw away razors?
How much oil is used in the process?
I think there are alternatives to growth and it is not a case of affluence or death.
Ask the 36.4 million people below the poverty line in the US.
Jerome,
I should clarify: eliminate oil use as a transportation fuel (other than for aviation) in the next 15 years....
Chris
From CNN - The IEA expects demand for oil to rise from 85 million barrels per day currently to 106 million barrels per day in 2030 -- 10 million barrels per day less than projected last year.
World energy demand to rise 1.6% per year, while cost of crude is expected to reach $200 a barrel by 2030.
What a joke! Production will not reach 106 mb per day ever....
By 2030, we should be off of oil as production will be at 50 mb per day or less.
Oil will not be a tradable commodity in 2030, it will be owned by governements and
only given to their needs and interests. In other words "priceless".