It's Back.

[ecosophia]

I don't know how many of my readers have been keeping track of the price of oil, but -- ahem -- it's rising again. West Texas Intermediate (WTI), one of the two standard benchmark grades of crude oil, ended the day a little below $70 a barrel; Brent -- the other standard benchmark -- was just below $75 a barrel. Just a few years ago they bottomed out in the low $40s. Now some thoughtful observers are starting to warn of an imminent oil shock. 

It's hard to tell at this point whether the price of oil will keep going up until it cracks $100 a barrel and once again starts drawing blood from the world's economy, or whether we'll see another downward lurch before the next oil price spike. My guess is that we're nearing the next spike. The gimmicks that kept petroleum prices under control for a while -- frantic extraction of shale oil and tar sands, on the one hand, and economic policies that suppressed demand by forcing a growing fraction of people in the industrial world into poverty, on the other -- were never more than temporary kluges; they postponed the problem while doing nothing to fix it and, inevitably, made the final consequences worse. 

The predicament we're in isn't hard to understand. The Earth is a sphere, and therefore contains a finite amount of fossil fuels; we're drawing down that stock of fossil fuels at a breakneck pace; most of the good stuff -- light sweet crude, anthracite coal, and so on -- was extracted and burned a long time ago; and now we're trying to keep the global industrial system running on low-grade fuels that are increasingly costly to extract and yield less and less energy. Renewable resources can't meet more than a small fraction of the demand -- despite whopping government subsidies in many nations, renewables account for only 9% of energy production worldwide, and 7% of that consists of hydroelectric; wind, solar, and all the other renewable resources produce a fraction of one per cent each. 

The solution isn't hard to understand, either.  We have to reduce our consumption of energy, and the products of energy, to levels that can be supported indefinitely by renewable resources -- let's say, 10% of current energy consumption. "We," furthermore, means you, personally, and me, and everyone else. The only choice we have is  whether we do this deliberately, or whether shortages, soaring prices, and economic dysfunction do it for us. 

You've heard this before, dear reader. I've talked about it at length since the early days of my old blog, The Archdruid Report.  The only thing that's changed since then is that billions more barrels of oil from our planet's dwindling supplies have been extracted and burnt. There may be another round of short-term fixes that will push off the day of reckoning a little further...or there may not. What will you do? 

Comments

Car culture

[(Anonymous)]

1.) Gas is up to around $3.09 and rising in the Chicago area. It goes up a little every week. 2.) Today was a beautiful, sunny picture postcard of a Saturday. The streets were clogged with cars when I drove to and from work. This made absolutely no sense to me. Why would anyone waste such a beautiful day by getting in a car if they didn't have to? -Kimberly

[drhooves]

Yeah, some of the recent trends in oil supplies, most notably new discoveries (2014 to 2017 are the four lowest years of new discoveries since the 1940s), indicate one thing: the jig is about up. I couldn't agree more that higher prices, shortages and economic dysfunction lie ahead. I was thinking we'd really start to feel the pinch by 2030, but now I'm rolling that back to 2025. Shortages could come and go over the next few years, with many of us being priced out of flying or long driving trips by then. Look for "carbon credits" restrictions for commercial air travel soon. And we'd be just one geopolitical crisis away from Uncle Sam rationing fuels for the military, winter heating and farming requirements.

What am I going to do about it? Move up my schedule of collapsing now, and avoiding the rush. I'll probably be relocating for work soon, and will be looking to live within walking distance of a grocery store and possibly work (or working from home), and near a bus line. When I moved to the Portland area four years ago, I thought it'd be nice to travel to Hawaii and Alaska from here - I don't need to do that, as the Columbia River Gorge is pretty sweet. I've got a motorcycle and a car, and don't need both, though it rains here a lot and I love the bike. Ugh.

I plan to support public policies promoting (sensible) public transportation, sustainable and lower energy food production, consumption taxes on Humvees, and education methods promoting good math and basic science skills to be used for improving critical thinking by everyone as we make choices ahead, and maybe head off a bit, a fraction, a tiny morsel of the pain.

There is awareness of this predicament by many, but as you've mentioned in the past, the necessary sacrifices to our current lifestyles to meet the 10% target for energy use is easier said than done. I may get into contingency planning, depending on the next job I land, as without a doubt there are crises ahead, of which we (as in society in general) are woefully unprepared. There are some sensible ways to mitigate some aspects of the decline, though it's become more obvious we're gonna hit the iceberg.

I don't feel nearly as much like Chicken Little as I used to....

Urgh...

[(Anonymous)]

What, you mean like stop driving a car! Ye gads.

The infrastructure of daily life in the UK (outside the cities) is so built on the car that it feels like an impossible choice. My wife and I are experimenting with it. I went to the hospital (15miles away) by bus and not only does it take a few hours (and connections) it also costs a chunk. But it is doable! The terrible thing is, the traffic was horrendous and it was full of cars with one person in them - creeping along. While the bus was empty, except for the one full of hyper school kids. How did we get it so wrong?
I think the bigger changes will be driven by finances - when the costs just get too high for car ownership/travel.

And I think these are smaller impacts of fuel use than the cost of transport of most of our goods and production of our food. We will be priced into a sustainable way of life. Unfortunately, costs of living and fuel are a political nightmare, so I can't see it happening in time. Meanwhile, the councils are cutting local services and reducing buses - all in the name of saving money - putting costs back on the consumer - who either pay more or miss out.

So after i read a post of yours last month, my wife and I are now looking at a cycling holiday instead of the common weekend city break - you know you can get return flights to cities in Europe for sometimes under £30! So actually the sustainable option is for the privileged who can either afford a train or can take the time. I know these aren't big problems, but at the moment, we are encouraged to drive/fly by huge subsidies and "economic necessity"... It's really tough to make another choice, but we are doing it slowly.

I wonder if part of the issue is that there is also a philosophical/psychological element? It seems our culture now so celebrates the whims of the individual above all else that we can find it "life-threatening" if we can't get what we want. If that is so, isn't that what needs to change rather than focusing on sustainable behaviours? What do you think? If so, how might we go about that? I know this is a central theme of ADR, but I'm thinking psychologically as well.

I can feel my own contentment with my surroundings growing through walks in nature and possibly the CGD work I'm doing, (And my need for consumtion reducing...). But, i am privileged enough to have the time & space for these things. Many don't. And I'm still along way from 10% energy use! Ye gads, I'm vexxed and a little overwhelmed when I read articles like this. What next?

Global problem.

[(Anonymous)]

"The only choice we have is whether we do this deliberately, or whether shortages, soaring prices, and economic dysfunction do it for us."

The unfortunate reality is that even if the West went out of its way to deliberately reduce energy consumption, the rest of the world probably would not follow along.

In places like China and India, life is materially a lot more comfortable for many people than it was even ten years ago, to say nothing of the differences in standard of living between the generations. Mobile phones, automobiles, washing machines, 24/7 electricity, air conditioning, etc, are new and offer social status. Environmental concerns are almost always directed to the government. "They need to deal with this!"

India has the most polluted cities in the world (well beyond China). The air in Delhi is so toxic it is vomit-inducing (I experienced it personally), but there are billboards announcing how X amount of kilometers of paved roads were constructed in the last few years. They tell the farmers in Punjab to stop burning their fields, but everyday new cars hit the roads and factories go online to get that 7~10% annual growth.

I am pessimistic. People will tolerate toxic air, soil and water so long as they have new kitchen counters and smartphones, even when their kids are struggling to breath due to asthma brought on by pollution.

Jeffrey

peak oil vindicated

[(Anonymous)]

I’ve been anticipating this post for a while, given the recent flurry of news items mentioning the rise in oil prices. Of course, since the media roundly ridiculed “peak oil” some years back, they have to come up with a whole bunch of other explanations (which, while superficially true, mask the underlying long-term reality that with each passing year our industrial civilization is being fueled more and more with low-grade “junk”). It will be entertaining to watch how the media will try to squelch the “peak oilers” during the coming oil price spike. Less entertaining, of course, is the price spike’s impact on economies at all scales.

My strategy has been to live in the best-planned neighbourhood in the city (virtually every product and service one could want [excepting a book store, of course – it is, after all, suburbia] is within a 10-15 minute walk of my front door. Also, being more active in the community (volunteering at community garden) and commuting less to work. House is energy efficient and small. Even have a Green Wizard “plan B” going in case an oil spike triggers an economic depression and pulls my employer down with it. Are my plans sufficient? Only time will tell!

Ron M

Time for action is now

[(Anonymous)]

I've been blessed to have gotten my family out of the city and on to a small farm, working from home most days,traded flight for rail for my few long trips, I reject Amazon and it's clones, and heat mostly with wood from a managed wood lot. But plastics, a key profit center of the petrolium industry, seem nearly impossible to avoid.Replacing plastic and building passive solar into the buildings here are top of the list this year. Mechanical or wind water pumps next.

what-could-have-been

[dfr1973]

So here I am, again thinking of my question that I had been meaning to ask in more than one open post (and was probably typing it as you posted and closed the most recent open post: If we collectively did not refuse the call at the end of the 70s, and instead kept working towards lower energy use through the 80s until today, what kind of things would we see? Obviously we wouldn't see the internet, nor all the SUVs, nor the exurbs and long commutes. I'm thinking we'd see more backyard gardening and chickening, and not just as a fad for yuppies (or whatever they call themselves these days - would that be hipsters?). From Retrotopia, I gather we'd see better public transportation in the urban areas, and probably more carpooling and ride sharing, along with more bicycle and pedestrian areas. You've also mentioned solar water heaters on the rooftops. I just wasn't aware enough yet when the cultural whiplash occurred to recall much else.

[(Anonymous)]

I figure the rush to get the Transmountain Pipeline done here in Canada is a sign that the Canadian government is thinking similar things to what you're saying. There's no other reason to rush things the way they did, especially since it looks like it's going to be highly embarrassing, even if they pull it off.

How close do you think we are to the end of business as usual?

Will J

What will you do?

[(Anonymous)]

Try to reduce consumption, continue composting and growing vegetables, and restart my tinkling with thermal solar energy...

All my attempts to raise awareness of energy issue here in Mauritius have not resulted in much. By and large people are uninterested or believe in the great god of progress bailing us out in due time.

Hence I tend to believe that it is next to impossible to avoid serious and long lasting economic and social disruptions.

I have done some calculations about the impact of oil prices on the mauritian economy. It appears that around US $100 per barrel, economic growth begins to drop significantly. Above US $ 120 - 140 per barrel economic growth drops to zero or becomes slightly negative. beyond that price level I do not think any one can model how the mauritian economy will behave. It becomes terra incognita from an economic perspective.

Karim from Mauritius

Re: Car culture

[ecosophia]

I have no idea. I ride with people from time to time, mostly when it's the most convenient option for them -- I have a fair number of friends who are elderly, disabled, etc., and under present conditions it's easier for them to drive than otherwise -- but left to myself? Feet, buses, and trains are my transport of choice.

[ecosophia]

Excellent -- good to see that somebody's looking at the discovery curves, and also thinking in practical terms. (Living close to work, errands, and a regular bus line will spare you a lot of grief.)

Re: Global problem.

[(Anonymous)]

I've been to Delhi too. It's awful. The scary part is I think you're right. I expect to see environmental laws disappear in the West too, since it'll be hard to keep our material standards of living otherwise.

Re: Urgh...

[ecosophia]

The psychological dimension is crucial, but it's very easy for people to mouth the right slogans and then climb into their SUVs -- I used to see that all the time in the peak oil circuit. That's why making changes in one's own lifestyle is so crucial. Your personal actions are where the rubber -- or the shoe leather! -- really meets the road.

Re: Global problem.

[ecosophia]

Those individuals, communities, and societies that don't deal with the reality of resource limits are going to slam face first into them anyway. Thus it doesn't really matter that much if people in Mumbai or Los Angeles keep the pedal to the metal -- the question is what you, personally, are going to do to keep from being clobbered.

Re: Car culture

[(Anonymous)]

I think it's frankly disgusting. The sheer number of cars, the amount of time and energy they waste, and the effects on health and the environment is awful. I expect to see them for quite a while yet though, since most people disagree.

Re: peak oil vindicated

[ecosophia]

Entertaining indeed. I plan on talking about peak oil again, explaining why the media's handwaving isn't worth the electrons it's printed on, and helping those who are willing to get a clue accomplish that useful task.

Re: Time for action is now

[ecosophia]

Excellent. Your timing is good!

Re: what-could-have-been

[ecosophia]

I'm seriously considering a post on this subject on the main blog.

[ecosophia]

There won't be a single date at which business as usual stops. What I expect to happen instead is what we've seen to date -- a slow whittling away of business as usual, with massive changes happening at a pace that you can avoid noticing if you really want to. I look around at the United States today, with its collapsing infrastructure, its increasingly intractable social conflicts, its Potemkin-village economy, and the rest of it, and it takes a bit of an effort to remember that twenty years ago things weren't anything like this bad. In the same way, in 2040 or so, it's quite possible that people will still be insisting that nothing has changed, even though half the US population in that year has no access to electricity or running water and the military junta that runs the country in that year is fighting a losing war against ongoing insurgencies in the South and the mountain West.

Re: What will you do?

[ecosophia]

I think you're probably right. Here in the US, for that matter, even among those people who are willing to admit the possibility that our society may be running out of fossil fuels, the great majority insist airily that renewables or fusion or something else will infallibly save us. Very, very few are willing to think about the possibility that the energy fairy hasn't promised us a nice new energy source to replace the ones we've wasted so pointlessly!

Re: what-could-have-been

[dfr1973]

Oh good! That is what I was hoping for, as a good word-sketch would take a lot more than just a comment in reply. For those who weren't there (or weren't old enough to grok it) it is difficult to suss out what we've missed out on.

[(Anonymous)]

Just lost our main job and have to move. Really wish we could wait until after the speculative real estate collapse but unfortunately rents are still sky high for the moment. Funny how the same people who question the value of production of real goods and services have no ethical issue raising the rent to obscene levels, and then turn around and complain "someone should do something" about the exploding homeless population.

We also had two beloved cars die recently but now thinking the timing isn't so bad. I could fix them but it would be very expensive and time consuming, and maybe the universe is trying to tell us something.

[(Anonymous)]

For one thing I will be scouting local yard sales to find a second hand bicycle. Advantages being it will be hopefully cheaper and even better already put together (I'm a bit tool-challenged). Curiously I have found myself feverishly reading through my book collection, ditching books that no longer appeal to me. The nice thing is that it makes room for the new books I have gotten. But I find myself full of an odd sense of urgency about this. It may just simply be because I am approaching retirement and will have to downsize in any case. But I can't help wondering if something significant is on the horizon.

Possible signs of the times; the local Sonoco gas station has just been torn down. Taking its place will not be a bigger and better gas station but a convenience store, a puzzling choice as we already have a million of them up here. The Northern Pass project is currently dead in the water (being unkindly referred to by some as 'Walking Dead - Northern Pass edition), its advocates still plaintively appealing to the NH SEC for a permit. If a major crisis in the economy triggered by unstable oil prices happens, these two endeavors may very well topple out of sight with Northern Pass being missed even less than a convenience store.

JLfromNH

[fluiddruid]

I will keep cutting my consumption to stay ahead of the curve, as much as possible. So far it has not been too difficult, but time will tell. I suppose people in oil producing nations like Russia and Saudi Arabia will be happy about the coming oil price spike, that is until the global economy crashes again. I have a feeling that we are actually going to see global oil production going into terminal decline in early 2020s. I also think that the short-term fixes in the US will take the form of scrapping of the existing environmental regulations on oil drilling.

I’m already affected

[(Anonymous)]

@ Kimberly - Only $3.09 a gallon? Lucky you! I’ve seen $3.69 around here (SF area) and higher.

I’m already affected, not so much by petroleum (yet), but by natgas prices. The criminal organization known to me as Putin Gas and Electric (for their Gazprom-like extortion tactics) has shut off the gas to me and my family, so we’re down to cold water. Our situation is somewhat akin to that of those folks in Detroit and Baltimore who’ve had their water shut off, though not quite so extreme, praise the gods.

I’m looking into on-demand electric water heaters, but as we’re renters this may be tricky; and it’ll take a miracle to afford them. If we had money, we wouldn’t have lost the gas, right? But I’d gladly pay break-even just to stick it to The Man. Local city rates for electricity are a lot more reasonable. Not that that’s clean or sustainable or anything.

I regard this as a stair step down the slope of decline as experienced on an individual level. There are worse ones, and I’ll feel lucky to avoid them.