June 11, 2009

Just as I get my Jeep Commache finally running right and back on the road — a near-two-year traumatic odyssey — fuel prices at the pump are starting to go up again, rising 20 cents in less than a month.
Here in northern California, we’re now paying $3.25 a gallon, well above the national upwardly-mobile US average of $2.63 a gallon.

This particular increase, however, has reportedly started to act oddly beyond the summer supply/demand bullshit, and gas-pump prices might be finally reflecting the affects of what’s termed “Peak Oil.”
Crude oil closed at near $73 a barrel today, its highest point since last October.
The planet’s biggest oil fields are past peak production, declining 6 to 7 percent a year, and the end of easy, cheap fuel is near-about finished.
And the end has been a-coming awhile.
US oil production peaked in 1970, has dropped ever since and now imports about 60 percent of its oil.
The UK gushed with oil from the North Sea in the 1970s, but the field started to bust flat without warning in 1999, knocking the Brits from global oil producer to importer.

A most-excellent observation on this quickly-approaching energy disaster is from Michael Klare, author of Rising Powers, Shrinking Planet: The Geopolitics of Energy, proclaiming the official end of cheap oil in a piece today at tomdispatch.
Klare says word comes from the US Department of Engery’s annual International Energy Outlook (IEO) report — bad moon rising.
A few snippets from Klare’s post:

Very simply, it indicates that the usually optimistic analysts at the Department of Energy now believe global fuel supplies will simply not be able to keep pace with rising world energy demands.
For years now, assorted petroleum geologists and other energy types have been warning that world oil output is approaching a maximum sustainable daily level — a peak — and will subsequently go into decline, possibly producing global economic chaos.
Whatever the timing of the arrival of peak oil’s actual peak, there is growing agreement that we have, at last, made it into peak-oil territory, if not yet to the moment of irreversible decline.
Until recently, Energy Information Administration officials scoffed at the notion that a peak in global oil output was imminent or that we should anticipate a contraction in the future availability of petroleum any time soon.
“[We] expect conventional oil to peak closer to the middle than to the beginning of the 21st century,” the 2004 IEO report stated emphatically.

For example, any significant increase in biofuels use — assuming such fuels were produced by chemical means rather than, as now, by cooking — could substantially reduce emissions of carbon dioxide and other greenhouse gases, actually slowing the tempo of future climate change.
On the other hand, any increase in the production of Canadian oil sands, Venezuelan extra-heavy oil, and Rocky Mountain shale oil will entail energy-intensive activities at staggering levels, sure to emit vast amounts of CO2, which might more than cancel out any gains from the biofuels.
In addition, increased biofuels production risks the diversion of vast tracts of arable land from the crucial cultivation of basic food staples to the manufacture of transportation fuel.
If, as is likely, oil prices continue to rise, expect it to be ever more attractive for farmers to grow more corn and other crops for eventual conversion to transportation fuels, which means rises in food costs that could price basics out of the range of the very poor, while stretching working families to the limit.
As in May and June of 2008, when food riots spread across the planet in response to high food prices — caused, in part, by the diversion of vast amounts of corn acreage to biofuel production — this could well lead to mass unrest and mass starvation.

Read Klare’s entire post here.

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