Just curious… How long do you folks think that the world can continue to consume oil at its current pace? Oil is a limited resource. Any guesses as to just how limited?
Well oil is limited, but energy isn’t. Energy is the ultimate commodity, the economy doesn’t care what form it comes in as long as it “makes things go” (as a Pakled might say 
)
So yeah, I imagine oil will eventually become scarce, at which point the price will rise and consumption will drop. Necessity being the mother of invention, some other means of gathering energy will come along at that time and the world will continue much as it has these past few hundred years.
But I wouldn’t be getting worried about oil too soon. It doesn’t seem to be in any real crisis, they’ve been calling it scarce for decades and we still have as much as ever.
Julian Simon once made a bet with famed doomsayer Paul Erlich, in which Erlich got to pick 10 commodities in the world and he would win the bet if any one of them were priced higher in ten years’ time. Simon won the bet, as all ten that Erlich hand-selected dropped in price. So I’m not worried about resource scarcity quite yet.
Somewhere between 40 and 55 years on currently projections.
But of course you cannot project. Market forces will allow other sources to complete and oil/gas will be used for more and more specialist applications where you need high calorific valued transportable fuel but for some reason cannot use electric or hydrogen.
As those forces take hold the lifetime of oil as a fuel will extend but will lose market share. My guess is we will still be using it in a 100 years time and if we are not it will not be because it has “run out”.
To conclude: sometime/never.
Cheap oil - conventional easy to pump oil - is nearing or at peak now - meaning that about half of what was available has been already used - with about half left - but the production has peaked - ie from now on there will be less and less production of oil because of depeletion and because the easist to get to oil was produced first.
This will (has already) lead to higher prices - and effects world events as countries scramble to get a hold on the remaining resources (mostly in a small chunk of the middle east).
See these links for the science behind depletion :
http://www.simmonsco-intl.com/
Note that last link is to Matthew Simmons web site - look under speeches and there are plenty about the subject. Mr Simmons is one of the people involved with VP Cheney’s energy task force and has been talking about the problems with oil (and natural gas) supply for several years. He runs a mulitmillion dollar investment company that specializes in energy resources.
The idea that “market forces” and “neccessity” will not be like a magic wand. The fossil fuels our society has been using are not replenishing, and the alternatives are nowhere near as easy to develop or use as oil/natural gas. World economic growth is tied to growth in energy use and the world soon will not be able to grow energy - but instead will have to cut back - this will cause lots of problems - already is - especially in terms of food production. Food production is very dependent on oil/natural gas for mechanized farming, for the fertilizers (and some of the pesticides/herbicides) and for transporting the raw food for processing, the processed food for retailing.
According to many scientists, we might be at “peak oil” production right now - with a continual decline in available oil (not running out for many many years - but unable to grow supply to meet demand) on the horizon.
The awareness of these issues by the Bush White House is high, they are all big oil folks and know the importance of securing our future oil supply. The middle east becomes more vital to our national interests every day.
Read up and see for yourselves, don’t take my word for it - but I have found over several years of looking into this - that on one side of the issue you have scientists (mostly geologists who worked/are working for oil exploration companies) saying “we’re reaching a peak” vs economists who say “if oil runs out, other soruces become more economic to use - no problem”. The economists do not seem to be aware of fundamental issues such as physical limits to production, lack of a suitable substitute, and lack of thermodynamic issues (ie - some oil will never be able to be pumped - the oil that would take more energy to get out of the ground than you get from using that oil).
Good luck and stay aware. More and more mainstream news (including CNN) have begun to notice what has been talked about acedemically for years - and if you are looking you will see the signs of what is happening.
Erm, I originally one of your “geologists who worked for oil exploration companies” and still work in the sector but I am at one with the economists who say “if oil runs out, other soruces become more economic to use - no problem”.
I also used to work for XXXXX (Oil Major) Renewables - and I disagree, other sources are going to be here a lot sooner than you appear to think.
You cites however are interesting, I will study them further and may come back.
We can easily grow supply to meet demand BTW, just at the expense of how long the reserves last. We have decades to manage the adjustment, and even at US$28 per bbl oil is currently very cheap in real terms.
That the US is going to have to adjust to the end of ultra-cheap almost “free” energy is true, it does not mean the end of the world or even world economic growth is nigh. It ain’t.
Interesting notquitekarpov, what sources in particular do you see replacing oil/natural gas in the next 10-20 years? Especially how do you see transportation issues. The big problem as I understand it is in transportation - since our economic model has become increasingly “global marketplace” with raw resources mined or produced in one area - shipped to another area for processing into piece parts - then shipped to another place for assembling into final products, then shipped to another area for retailing. The price of oil affects the economy through every single product due to transportation alone (not including energy costs to make products - including food products) .
I agree that $30 oil is still pretty cheap (adjusted for inflation , etc) but our economic model of “buy wherever labor/materials are cheaper” is based on oil prices lower than $30, when oil is $40 or $60, that will cause some major problems and a re-shifting to local production - local consumption.
Also, I do not foresee continued economic growth (and world population growth) without a concurrent growth in energy resources. All of the alternative fuel sources will entail a cutback in immediate availability of energy - this will cause a cutback in growth - and also population - but that might involve more wars/famines/disease as well.
Here is a recent post on “energy resources” group :
http://groups.yahoo.com/group/energyresources/message/43477
Highligts of this posting include :
==============================================================
There is every reason to assume that the Bush administration understood at least the essential outlines of the situation. The President, Vice President, and National Security Advisor are former oil industry executives. Vice President Dick Cheney’s chief petroleum-futures guru, Matthew Simmons, had repeatedly warned his clients of coming energy-supply crises. Moreover, for many years the CIA had been monitoring global petroleum supplies. It had, for example, subscribed to the yearly report of Switzerland-based Petroconsultants, published at $35,000 per copy, and was surely also aware of their report The World’s Oil Supply 1995, which predicted the peak of global oil production would occur during the first decade of the new century.
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also
Some of the essential elements of Hubbert’s message have been taken up by others who are not petroleum geologists. One example is Matthew Simmons, founder of Simmons & Company International, an independent investment bank specializing in the energy industry. Simmons describes himself as a lifelong Republican with 30 years of experience in investment banking. In a lecture called “Digging Out of Our Energy Mess,” delivered to the American Association of Petroleum Geologists in June 2001, Simmons notes:
Even the Middle East is now beginning to experience, for the first time ever, how hard it is to grow production once giant fields roll over and begin to decline. There is so little data on field-by-field production statistics in the Middle East that any guesses on average decline rates are simply speculation. But there is growing evidence that almost every giant field in the Middle East has already passed its peak production.
A lot of what Mr Simmons has talked about worries me the most - he is very credible to me as a source of information - he has links to lots of information that I can never get to (including the Bush administration) and he is talking about these issues with more and more concern for what will happen globally and locally when the oil productions starts to decline (note -most are now talking about WHEN this will happen not IF).
I look forward to your informed response.
Thanks for your help in understanding these issues.
Regards
adamant
Possibly forever, or thousands of years, at any rate.
Prof. emeritus Thomas Gold came up with an interesting theory a few years ago that we cannot really run out of oil because, according to him, oilfields are constantly, if slowly, replenishing themselves from gases, such as methane, trickling up from the lower depths of the planet. According to him, this is how oilfields were formed in the first place.
Also, according to him, coalfields are former oilfields that solidified. Tarry oilfields are at a stage in between.
It seems to make somewhat more sense than believing it all came from a vast congregation of dead dinosaurs, which some people somehow seem to believe.
So, it looks like we can all play with our gas guzzling fun vehicles with a clear conscience after all.
Well, its not really proven to the satisfaction of the scientific community, but I admit it looked more logical to this layman. Still, its no problem to develop other sources.
Alan - that’s an interesting theory - but the evidence does not seem to support that theory so far. Fields follow the classic depletion patterns. Some “played out” fields yielded more oil with newer technologies but not enough to change the peak production (plus the technologies cost in terms of more energy in yielding less net energy - that’s also the basic problem with nonconventional oil sources like shale and tar sands - too much energy input required to totally replace the easily available conventional oil.
I hope Professor Gold is correct, I hope we finally get fusion power working, I hope we get solar working better (and cheaper) I hope that wind power gets more developed , etc (even conventional nuclear with newer smaller, cheaper safer designs would be great) - but all of this is happening too slowly to help us in the short term, particularly if the peak of oil production is now (or in the next few years).
We will see, I hope my views are too pessimistic, but the more I read the more I fear that I am too optimistic!
Regards
adamant
Smiling bandit, which other sources will be easy to develop? Solar is still not ready to take over - too much energy expense in developing and not good for transportation. Wind/geothermal - great but not enough to take over soon (big investments needed). Fusion - not ready - always 20 years away it seems. Fission - could be available but nothing is being done yet except new designs planned - not being built yet - takes a while. Coal - will definitely be more used - but coal does not replenish quickly either and is very dirty.
Noncoventional oil will become more important - but it is not clear to me that this avenue can be ramped up quickly enough to keep from having big problems.
Thanks for all the interesting debate.
Regards
adamant
Of course, even if Gold’s theory is even half true, the rate of replenishment, assuming it exists, is far too slow to keep up with the current demand.
Notwithstanding the above, there is no realistic prospect of the planet “running out” of anything, as there is almost always an substitute available for just about any currently “indispensable” commodity.
Alan, the actual argument by the “peak oil” folks is that there is no substitute for the cheap oil when it starts to become less available. That is all the substitutes energy wise are less useable, harder to get to, more energy intensive to produce, and need more (energy wasting) handling than easy to pump and ship oil.
The world demand for oil has continued to rise with population and economic growth - when we cannot easily grow our energy supply then economic and population growth will be physically impossible - indeed population loss will be inevitable due to lack of food resources without energy to drive the tractors, make the fertilizer, process the food, ship the food, drive to the store to buy the food.
The idea that there is a substitute for everything might just be wishful thinking. This seems to be many technical, educated people’s response - we’ll think of something. But the things we can do might be limited by actual pyhsical reality of energy depletion, law of thermodynamics, etc. If so, when reality hits - it will be huge in terms of public response (blame the arabs , blame the current govt, etc) as well as actual shortages of food, medicene, transportation.
I hope you are right, but I have seen nothing out there right now that can easily substitute for cheap oil.
Best Regards
adamant
Too bad Environmental Economics hadn’t been formulated yet, or I bet Erlich would have won.
It so happens that a friend of mine (a physics professor at Eastern Michigan University) has a website devoted to the issue of fossil fuel depletion: http://www.physics.emich.edu/ebehringer/FossilFuels/overview_fossilfuels.html
If you look around at this site and have a new enough browser (which I don’t here at work), I believe you can get to a calculator where you can get the lifetime for oil under various assumptions. One thing that many people fail to understand is how much even a small growth rate in the use of a resource has on its lifetime. For example, there is a big difference between asking what will happen if we continue consuming oil at the current rate or if we continue increasing our consumption of oil at our current rate in percentage terms. I don’t know what that current rate of increase is off the top of my head. But, the point is that even if it is merely 1% per year, that means we will be consuming twice as much oil 70 years from now and that significantly impacts lifetime estimates!
At any rate, as one of the Arab oil sheiks recently admitted, the problem may not be so much running out of oil as it will be the growing environmental costs of continuing to use it (global warming et al.). I.e., we need to switch away from oil for environmental reasons even before scarcity catches up with us unless, for example, we find a good way to sequester the CO2 produced by burning it.
A bit of gloom and doom, from The City in Mind by James Howard Kunstler (2001) – the chapter on Atlanta, pp. 60, 73-75:
And from Kunstler’s website, at http://www.kunstler.com/mags_diary7.html:
I’ve often wondered if it would be possible to synthetically create gasoline. Due to its ease of transport, it seems like it’s superior to hydrogen, etc. It’s much more energy dense per gallon of even liquid hydrogen. Plus liquid hydrogen needs to be compressed, gasoline doesn’t.
A gallon of gas has about 38 KWhours of energy. A KW hour can be generated for about 2 cents. Even wind energy can generate cheap electricity, so you needn’t rule out renewables. The problem with wind energy is that you can’t store the electricity and it’s intermittent, so it doesn’t displace much existing capacity.
You could generate this electricity…convert the energy to hydrogen by electrolysing water…combine the hydrogen with a carbon (from coal or wherever) and you’d have, presto, a hydro-carbon.
The raw energy costs would be about 80 cents a gallon (2 cents per KWhour * 38 KWHs/ gallon), plus due to conversion inefficiencies, it would cost more. If the final conversion were 33% then it would cost $3.00 a gallon. Compared to about $1.00 a gallon today (without taxes). That would be alot, but I think we’d survive.
The US uses 7 B barrels a year. Maybe half of that’s for transportation. So 3.5* 50 or 175 gallons a year of gasoline.
So it would be an extra 350 billion dollars a year. Quite a hit. Of course, fuel efficiency would probably double plus it would create many domestic jobs.
But would this be do-able? I’m not a chemical engineer. Does my conjecture make any sense?
Yes it is very possible to synthesize gasoline from any hydrocarbon source + energy - The Germans were doing way back at the end of WWII. It just cost considerably more pumping oil out of the ground and refining it. However, there has been recent advances in the technology - Thermal Depolymerization looks quite promising.
Correction: I should have said * It just cost considerably more to sythesize oil than is does to pump it out of the ground. *
Yes, I’ve heard that. I think they were doing straight coal to oil. That would take a lot of coal though, which kind of defeats the purpose. I’m curious as to whether it’s possible, and if so how much efficiency there is, to convert electricity + carbon to oil/gasoline/hydrocarbon.
Plus my numbers were alittle off. 80 cents per gallon, 1/3 efficiency is 2.40 per gallon.
I’m usually on the side of the environmentalists, and I’ll admit firsthand that I have no oil industry experience, but they’ve been screaming bloody murder about the oil running out since I was in elementary school (and it was a well-established enough idea that it was TAUGHT in that elementary school), and that was 25 years ago.
Then again, gasoline cost 0.60 cents a gallon back then, too…