Peak Oil and Climate Change: No Cod Either
The leader of a poor country goes to the leader of a very rich one.
“Please sell us some oil,” he asks, “so we too can enjoy the wonderful life your people enjoy.”
“There isn’t any oil”, comes the reply.
“That’s no good. How can I tell my people they must live in poverty, while they watch you on TV having a fine life? Please sell us the oil we need”.
“There isn’t any oil”.
“If you don’t sell us the oil, the poor people of the world will rise up in great anger, and take it from you”.
“They can’t,” replied the weary leader of the rich country. “Listen carefully. There isn’t any O–I–F–L”.
The leader of the poor country looks baffled. “There is no “F” in OIL”.
“That’s just what I’ve been trying to tell you!”
Sorry about that, the oldest joke so far. I found it down the back of the wardrobe concealed in a big ball of fluff, but it does the job. For one thing, the joke as I first heard it – where cod was the subject – applied only to a fish and chip shop, not the whole bloody ocean, which goes to show that irony is a weapon easily concealed. Another purpose I have is to alleviate, temporarily I’m afraid, the apocalyptic tone that creeps in to this blog from time to time.
I really want to write positive, hopeful posts, but because many of my ideas have to be considered in the context of what I think we’re doing wrong, I have had to write about many of the negative aspects of human behaviour. I haven’t spent much time extolling our virtues, however. For the record, let me state that humans at their best are wondrous, luminous creatures; incredibly talented, skilful beyond any reasonable expectation, and extraordinarily surprising. At their worst, they are utter shite.
I’m on a mission, as I’ve already admitted. It is to put the creation of a utopian civilisation at the top of every agenda. All the time I’ve been writing, I have been seeking any opportunity to persuade the reader that doing something about our lot and improving it is urgent. Reading this blog or my essays is not enough however, not nearly enough. So far, I’ve alluded to certain disasters we might bring on ourselves, like the destruction of our culture, screwing up the food chain or having a another world war.
The trouble is, these things are only possibilities, and may not happen. My experience of humans is that unless they have to change, they will not – how many disasters could have been averted by the measures that were put in place after the event? All in all, I don’t think any possibility about which I could hypothesise would actually be sufficient to actually cause change. What I need is inevitability, something I can predict with confidence, a catalyst event that cannot be avoided and that will lead to catastrophe if we don’t change our ways. A date for the apocalypse would also be helpful. The catalyst is the end of fossil fuels; the date, around 2025 (see footnote).
To repeat that another way: there is going to be a monumental problem that will involve every single person on the planet, in less than 20 years. And since dates like this offered by pundits like me are usually spurious, let me explain how I came to it. There are various estimates, from a variety of sources, which predict when oil production will slow down. The earliest projection I found was 2014, the latest 2025. I have erred on the side of caution, and quoted the later date. I then checked the data with the International Energy Authority figures. They have published comparisons between various research bodies, energy companies and so on, and the latest date for a slowdown averaged out at 2025. It was also interesting to note that while every oil production graph declined over time, every projection of world energy requirements went steadily upward.
Our modern civilisation has come about because we found a way – apparently – to get something for nothing. We didn’t have to create coal, gas or oil. All we had to do was get it out of the ground and use it. Fossil fuels are rather like a one-shot rocket booster for mankind, provided by nature. You fire it, civilisation advances very fast for a while, then the rocket dies and you look back to see how far you went. When the balance sheet of our times is audited by history, I think we will be found wanting of judgement considering where we have chosen to go on this once-in-a-mankind free ride.
The people of the industrial west have very little notion of how dependent they are on fossil fuels, especially oil. Energy has been so cheap that the costs of industrialisation were greatly subsidised from the beginning. The entire edifice created out of the industrial revolution is based on the fossil fuels, with no other alternatives. When the oil and gas run out (coal being rather more limited in utility), there will be great change in every walk of life.
Let’s consider a few.
Our factories run exclusively on non-renewable energy sources. Absolutely everything we value about our consumer lifestyles in the west will be affected. The consumer goods that constitute our main rewards will become very expensive, until virtually everything is a luxury again, rather than the necessities they have become. Healthcare and medicines will cost a great deal more, since all pharmaceutical industries use raw energy in copious quantities. The infrastructure of the industrial nations, which burns energy like there’s no tomorrow, will shrivel into a parody of itself.
Rationing of one kind or another will be introduced if industry cannot produce sufficient goods. There will be waiting lists for every manufactured product, including clothes, tools, decorating and building materials, computers, phones and CDs. The demand will still exist, but we’ll be back to delivery in a year of our one and only TV, and our choices will be limited in ways we can barely conceive of, surrounded as we are by the cornucopia of goods we take for granted.
Plastic will become as expensive as teak or ivory, while the extraction and processing of raw materials will be prohibitively expensive for all but the most basic commodities. Mass-production will have to be scaled down considerably as the cost of electricity and fuel oil goes through the roof, and the diminished scale will increase all manufacturing costs. Getting to and from work will cost ten times what we pay now. Personal transport will disappear as we know it; fuel cells and hydrogen-powered vehicles will never run so cheaply they can offset the enormous investment a car will come to represent, since a car’s production is one of the most energy-intensive industrial processes. Road, rail and sea transport overheads will suffer dramatic increases, greatly adding to the costs of moving materials and goods, especially foods, as well as people. Air travel will cost a fortune, the routes and flights greatly diminished as the price of jet fuel soars.
And in every example I have given, there is another factor that will cost us dear. Think how many people work in these industries, then think what will inevitably happen to them when the oil starts running out and factory after factory is forced to close down, or severely cut back output. Not only will the price of everything go up, but many more people will have no job to go to, and no income. The economy will shatter and all the services and institutional support we take for granted, like the NHS, benefits and pensions, will all cease because the tax revenue on which they depend will wither away. The outcome of such a scenario is a return to widespread poverty all across the western world. An entire culture betrayed by its own values; if society believes that through conspicuous consumption they get their reward, what happens to us when we can no longer be rewarded? What good will free trade and global markets do us when there’s nothing to buy, or nothing we can afford?
I’m having adjectival problems getting across the enormity of this issue. Wherever you are right now, if you look around you, everything you can see was made, one way or another, out of fossil fuels. Every item in your home relied on fossil fuels for its manufacture. Everything you own required fossil fuels to get it to your home, and depends on fossil fuels to take it away when you’ve finished with it. The cheap food you buy depends on the products of the chemical industries, harvested by machines and delivered in ships and lorries, all of which depend on fossil fuels. The list goes on and on and so am I, so I’ll stop now, but I hope you’re convinced.
Please have pity on this poor messenger, for he hasn’t yet delivered the worst of it. There are two geopolitical implications to the end of cheap energy that I think are of grave concern. The first issue arises when people who are used to a high standard of living find they can no longer maintain it. In this case, the US – by far the most energy-dependent country in the world – will be worst hit by a slowing down in fossil fuel production. Even now, Americans enjoy petrol that costs a fraction of the price in other nations. The car-owning voters are so committed to their vehicles and the right to travel in them that no federal government has been able to take them on. The whole geographic infrastructure, from shopping to work, education through urban planning, is based on car and plane travel. Without cars, America would come to a standstill overnight.
But American consumption is not just about cars, it’s about everything. As the US economy starts to decline, and a raft of social problems make their first appearance, there will be tremendous pressure on the government to “do something about it”. It has always been the policy of US governments to first protect the right of the US citizen, and in the current world order that can easily be seen as a mandate to protect the right to consume.
In light of the way we often seek to blame others, and bearing in mind the US is the greatest military power in the world, it would not be beyond the realm of speculation to suggest that other nations sitting on extremely valuable oil reserves, especially in the middle east, are coming under increasing threat. While setting prices in keeping with oil’s scarcity, they may find themselves blamed by the US administration for causing a reduction in the US standard of living. Shortly thereafter, they would be invaded to “protect ordinary Americans from the threat posed by unscrupulous Islamic leaders, who never forgave us for invading Iraq and now seek to manipulate our economy” or some such.
Europe and the Far East, desperately needy themselves, and outraged by the US dominance of the energy reserves, would align themselves with the remaining oil producing countries, mimicking the interlocking defence agreements that brought about the first world war. As positions harden into US, European and Pacific Rim alliances, each block would be vying for access to the remaining cheap energy reserves in order to pacify their desperate electorate. It’s alarmingly obvious where all this could lead.
The second globally significant aspect of a slow-down in energy production takes the form of a broken promise. The benefits of industrialisation have been most iniquitously distributed, and much advantage has been taken of underdeveloped nations through political and economic colonialism. The knowledge that things are very unfair is widespread, and the only thing that keeps the lid on is the promise that one day, you too could have all these wonderful things.
Throughout the history of capitalism, the founders have sought to enlarge their markets by bringing their wares to other nations. When a nation was too poor to join the club, they were promised that if they adopted democracy, built an infrastructure, educated their people and worked industriously, they too could enjoy the fruits of mass-production (although some managed this without the inconvenience of democracy, but never as well, it seems). In the meantime, we would help them achieve their industrial ambitions in exchange for cheap raw materials and labour – and I do mean cheap. The exploitation of poor nations by rich ones is notorious, but the anger of poor nations is tempered by a vision of the future in which they can live like Americans (presumably by exploiting someone else, although I can’t imagine who that will be. We can’t all be slave-owners; somebody has to play the slave).
With the decline of cheap energy, the emerging nations who invested in industry will not have time to produce enough benefits to achieve parity with the wealthy nations. Those nations who have yet to gear up for industrialisation never will. All underprivileged countries will look at the west, and realise that not only did one-fifth of the world’s population enjoy a privileged lifestyle on the back of the four-fifths who contributed the resources; they also used up all the energy that made it possible. It will be the end of the dream for underdeveloped countries, faced with the certain knowledge they will remain that way because there are no cheap fossil fuels left with which to rebuild their countries. The rocket will flicker and the engines die. Only then will many realise that only a few took the ride, leaving everyone else behind.
The year 2025 is not when oil will run out. That event is probably a hundred years away, or more. This date is, however, the reasonable prediction of something completely inevitable; the decline of available energy. One day around that time, OPEC will announce that it couldn’t produce quite as much oil as in the previous year. It might not be 2025; an error of a few years either way is neither here nor there. What is certain is that the downturn in production will happen in your lifetime, unless you are over 70 as you read this.
With the slowdown will come the panic, and the wars. Economic markets will go into freefall, because there can be no possible light at the end of the tunnel except our worst energy nightmares, dirty brown coal or nuclear fuels. Nuclear power is the only possible timely replacement for fossil fuels that can produce enough clean power to keep industry going. A proliferation of nuclear technologies through the developing world – which they will demand as the only way the promise made to them by the west can still be met – will also greatly exacerbate the risk of nuclear incidents, civil, military or subversive. Vast sums will be plunged into renewable energy sources and ways to get rid of the increased quantity of radioactive waste, but much too late. New nuclear power stations, which can take many years to build and bring on line, will only be started when we are already in trouble; the opponents of nuclear power are very vocal and wield considerable influence.
While I too deplore such dangerous technologies, I cannot help but conclude the arguments are flawed. It has long been recognised that renewable energy will never provide the kind of power needed to make steel, build ships or run train networks. Are we to stop doing these things, or watch them become elitist activities through the sheer expense, because of an aversion to the power source that could keep them going? That said, the faster we develop benign energy sources, the less nuclear power would be required. It is a matter of balance and prioritisation.
Nor is it that our demands for cheap energy are stable, let alone diminishing. As I said earlier, all projections of world energy demands over the next century can be represented as a line travelling forever upward on the graph. Our needs are on a crash course with reality, and the collision will be one hell of a bang.
Footnote: This piece was written in 2002. Turns out that the IEA was lying, so the 2025 date is rather optimistic and the collision is imminent. Here’s one chilling assessment:
“A supply crunch appears likely around 2013…given recent price experience, a spike in excess of $200 per barrel is not infeasible”
Professor Paul Stevens, Chatham House, writing in the Sustainable Energy Security: Strategic risks and opportunities for business white paper produced by Lloyd’s of London and Chatham House