Oil is a non-renewable fossil fuel; there is a limited supply available on this planet, and it has been well advertised that oil reserves are being depleted too quickly. But what constitues an oil reserve? An oil reserve is oil that can be abstracted in a financially viable way. What this means is that there is more oil available, but as of yet, we do not have the technology to abstract it economically. In 50 years, we may have developed the technology and the reserves will increase.
Whether we are running out of oil or not, the bottom line is, using it as a fuel is not good for the environment. In recent decades, general public awareness of global environmental issues has increased significantly. Many consumers are now willing to pay more money for something that it labelled as 'green'.
Of course, oil will never run out. The power of an economically driven market will ensure that as a comodity becomes rarer, prices will be driven higher and higher, until it becomes cheaper to use an alternative. The worry should be whether we will have enough energy to continue to drive our economy and the fate of the oil producing nations.
Well - is the world running out of oil or isn't it?
On the face of it, given the astronomic rise in fuel prices on the garage forecourts since 2007, you would have to say yes. Today in Ireland (1/07/08) the price of a litre of unleaded fuel is around the Euro1.33 mark, with diesel (traditionally a cheaper fuel than petrol) 11 cents dearer at about Euro1.44 a litre. Little over a year ago I was paying a meagre Euro0.89 per litre for diesel, and it was mostly around 10 cents a litre cheaper than unleaded fuel.
A barrel of crude oil is now reported to have topped US$146, which doesn't auger well for future prices at the pumps.
Reports about the amount of oil reserves in the media are often conflicting, with the "doom and gloom" merchants categorically stating that world production of oil has now peaked, and that increasing demand for oil from emerging "tiger" economies like China and India will only see the situation becoming worse in the future as new consumers in these countries demand oil for their cars and industry, thus pushing prices even higher.
Unfortunately, this huge increase in world oil and fossil fuel consumption comes at a time when the Western nations in particular are becoming increasingly worried about the effects of global warming, and are beginning to take steps to decrease the amount of CO2 and greenhouse gasses being pumped into the atmosphere. Here in Ireland we are just about to change our car taxation laws (July 2008) which will see the price of cars that produce small amounts of CO2 drop considerably, and the yearly road tax rate is now to be based on the emissions rating of the car rather than the engine size. (As it was in the past) However, it's unlikely that any of the new high consumption nations will pay any heed to the West's calls for lower emissions, which sort of negates the whole point of the exercise.
So if the forecasters who reckon that world oil production has already peaked are to be believed then everyone on the planet is in for a very rocky ride as the already high oil consuming countries in the West compete in a cutthroat market with the emerging new economic powers in Asia and the Far East for ever dwindling reserves of oil.
Other media reports about future oil supply take a different view and state that the current high prices have been caused simply by speculators (the financial sector) driving up the price; that the current high prices are simply unsustainable in the long term and will eventually peak and start to drop dramatically again back to a more realistic level. If this is the case then we will gradually see oil prices return to a more realistic and sustainable level.
Others state that there are actually still plentiful oil supplies, but that the oil producing nations, both OPEC and non-OPEC, are simply "cashing in" on the current situation and reaping the financial windfall of the current high prices. I'm old enough to remember the "oil crisis" in the UK during the early 1970's, when supply was cut off by the Arab oil producing nations, and motor transport (and the economy) nearly ground to a complete standstill. Petrol was "rationed" at the pumps, and you often had to queue for hours in order to obtain just a couple of gallons of fuel for your car! It's a scenario I would hate to see repeated today, especially given the enormous increase in the number of people in the Western nations in particular who now own motor vehicles.
Certainly it does appear that both the Arab nations and non-Arab oil producers like Mexico, Norway and Russia are dragging their feet when it comes to either increasing the flow of oil from existing oil fields or investing time and money into finding and developing new resources. Siberia in Russia, for example, is vastly underdeveloped, and many believe there is more untapped oil under the ground there than in all the Middle Eastern countries combined! It's also reckoned that there are vast untapped oil reserves under the Artic icecap, which at present aren't being utilised as it is simply uneconomic to spend the huge amounts of money involved in developing the technology required to bring it to the surface.
North Sea oil supplies, both in the Norwegian and British sectors appear to be fairly stagnant, but my own belief is that there are many other areas under the oceans where vast new oil fields still await discovery. Off the coasts of Ireland there have already been some significant discoveries (Spanish Point, Dunquin, Corrib and Dooish) but to date these are mostly still in the exploratory stage and not in production. The Dooish field, for example, is currently capped as it is apparently currently commercially unviable to develop it further due to the field's depth.
Given the conflicting reports that seem to appear in the media on a daily basis it can be hard for the layman (I'm a layman) to decipher the truth of the situation. It's got to the stage that I simply don't know what to believe.
But of one thing I am sure. The world simply cannot go on basing their economies on the basis of a plentiful supply of oil in order to run their industries, power stations and motor vehicles. Whatever the truth about the current situation in regard to ongoing oil supply the simple truth is staring us all in the face; a viable alternative for the internal combustion engine *MUST* be found, and found sooner rather than later. With world consumption of oil increasing on a daily basis it is an undeniable fact that eventually we will run out of what is a finite resource, so it is imperative that an alternative fuel supply is found. (And quickly!)
There have been many false dawns in this search in recent times. We have the advent of "bio-fuel"; the production of oil from vegetable, rape seed, and agricultural products. Initially this seemed like a wonderful idea, until it became apparent that Third World countries in particular were diverting crops traditionally used in the food chain into producing crops to manufacture bio-fuel. This makes it clear that this idea is unviable right from the get go.
Hybrid cars (like the Toyota Prius) have been developed, that use a combination of traditional fuel and electric cell technology to vastly improve the efficiency and miles achieved per gallon of fuel used. This is a good idea, but also has its drawbacks. To date, the electric cells used are too large and bulky, and the performances of the cars themselves leave something to be desired. So they have been slow to catch on with consumers.
Cars powered by hydrogen have also been developed. Germany seems to be leading the way, with German car giants BMW recently developing a "green" version of their executive saloon, the "7" series. However, this appears to me to be yet another false dawn, as the car is actually another hybrid, running on either conventional petrol or hydrogen. When using hydrogen it only achieves a mere 100 kilometres for every 50 litres, and it can then take up to half an hour to refill the hydrogen tank!
Just a thought in passing. I can recall my late father telling me stories of how during World War Two many farmers adapted their trucks and agricultural machinery to run on methane gas, rather in the same way that some modern vehicles now run on Liquid Petroleum Gas. (LPG) This methane was collected from the gas produced by pig, cow and animal manure which they collected on their farms and which was then stored in improvised tanks on the roofs of their vehicles. Maybe this is the way of the future? Cars and vehicles run on pig sh*t! OK. I know this sounds far fetched, but it *IS* possible. It would also help enormously to reducing the global warming problem, as much of this is caused by methane gas produced by farm animals!
I personally am not as pessimistic about the future as some pundits appear to be. I believe that humans as a species are infinitely resourceful, and that sooner or later someone will come up with a viable alternative to using oil as our main energy source.
© KenJ July 2008
Oil reserves are depleting fast and the demand is rising steeply. Price of barrel of crude oil is above $70 in UK and USA. I remember when it was $18. Apparently we have reached the peak of oil left in the world, this happened this year. Nature took millions of years to produce oil; man has used it up in 100 years. In the future oil demand will increase while output will steadily decline. Industrial processes are not there to produce artificial oil.
More cars and higher industrial demand is using up oil reserves really fast.
For the first time in history of man, bio fuels and alternative to oil is seriously being considered by commercial companies and governments.
The most likely alternative to car is Ethanol. Corn is main source of this chemical. Good thing about corn is left over could be turned to animal feed. While Ethanol is efficient as energy source for motor vehicles and industrial use I think Nuclear power is option for generating electricity.
Never! Since when? We are running out of oil and I am glad we are. End of oil means end of petty wars.
Oil may be running out in places where it is easy to get. However there are plenty of other places, ie Africa, Australia, Alaska, Asia where new discoveries are made each month. West Africa is the latest Middle East for oil.
Instead of petrol cars can run on many other things, fuel made from fruit, compressed air etc.
I can predict a time when price of oil will be less than $10 and no one will buy it.
Palm oil and other sustainable man made resources to used in manufacturing and energy production will be widely used in the next decade.
Alternative to oil (fuels)
organic waste could be made into fuel.
Compressed air, water etc.
As you can see there are so many alternatives to oil as energy source.
However as history would suggest oil companies would survey the entire globe for oil and extract it before alternatives will be used.
While it is true oil is used in lot of products (other than cars) there are viable alternatives and loss of oil is not a big deal. People will learn to live without it.
Ts Eliot said the world would end 'not with a bang, but with a whimper', presumably stripped of its resources and life-forces. But I don't think he had vectored in our addiction and self-destructive need for oil, the most combustible commodity the world has ever known.
Oil is running out, of course, especially on the floor of the Gulf of Mexico. Obama attacked BP to keep the pack of his back whilst BP intend to attack the America rig owners Transocean, and Haliburton, the suppliers of the faulty piece of the drill bit. But this was an accident waiting to happen and so pointles attacking BP.
Oil is running out and its the stuff that we fight wars over in Iraq. It's not called black gold for nothing. Small Muslim children are vaporized with uranium tipped shells because obese Americans are not prepared to waddle up to the local store to get their cookies and American Pie. It really is as simple as that. Fortunately ciao has a lot of intelligent people on the site and no one really argues against that case. But if you have that oil under your lands you have no choice but to keep it flowing, be it through deceased grubby dictators like Saddam or our new friends like Colonel Gadaffi, the old Saddam Hussein. As George bush Senior said at the time:" Saddam maybe a son of a bicth but he's our son of a bitch!" Rather ironically there was and is a petrol shortage in Iraq after the war, the world's second most lucrative supply unable to fuel the governments swanky US paid for Limmo's.
Just how much oil and petrol we have left on the planet is the big debate. The Independent broadsheet printed some scare headlines last week that the tipping point was just five years away, the moment where we are only drilling out as much as we use. You only need visualize a pint glass being drunk to get very worried quickly. The thinking mans papers message was backed up by prominent retired oil people who's job it was (but not anymore) to talk up how much reserves their companies had to keep the price stable and fear low. It turns out its all an illusion. It's becoming clear that the biggest oil companies just haven't got the reserves they claim. If this becomes the general consensus in the markets and no new fields are discovered then the $100 barrel is just over the horizon, totally decimating the world economy.
In Russia, BP and Shell have just lost huge fields to Gazpron, the Russian state owned oil and gas company, forced to sell then back to Gazpron at a fraction of the price because of political black mail. In the 80s and 90s the international oil conglomerates were invited in to the new Russia for their expertise to exploit the huge fields. But the greedy western oil magnets exploited Russia in the complex contracts, expecting huge profits from the pumped oil, the common method used of empirical exploitation in the third world of oil and gas resources. As soon as Putin arrived he let them finish the work, get the oil flowing, and then nicked it all back, making Russia the soon to be energy super power, able to switch the gas off when we in Europe most need it. He's done it before and will do it again.
America and the UK, representative of the worlds biggest oil companies, have battled back in the new millennium, invading Afghanistan to flex some military muscle in Central Asia. Here we can build military bases to protect any future oil deals with the satellite Old Russian republics, and so secure the long awaited pipeline to the west that would cut through Afghanistan. 911 couldn't have come quicker as a catalyst to secure the west oil and gas supplies.
The invasion of Iraq was also critical. The advantage of Middle East fields is the oil is near the surface and so reasonably cheap to get at, the big cost being security of supply over actual extraction. It's much cheaper to invade Iraq and its existing fields than to drill at the untapped remaining oil around the world in awkward places. A conspiracy theory goes that Haliburton sabtoaged BTs drilling in the Gulf so Iraqs oil came into play more and of which they own huge contracts with.
America sees themselves as the world policeman, but only because they need the worlds resources, their baton charge through Iraq's front door painfully obvious to all. The US burns 40% of the world's gasoline in its cars and one quarter of its refined oil. Their method of security of supply is brutal and uncompromising where as ours is more diplomatic.
Other respected magazines and broadsheets are much more upbeat and reassuring about supply, talking of 50 to 100 years of oil reserves out there, but again, is this all part of the hype to stop panic. We know with the explosion of China and India's economy they, along with North America, will alone be using ALL known supplies by 2025. If you actually stop and think about that fact then it's terrifying. We saw Tony Blair's ashen face during the fuelers strike of 2000, a situation he quickly lost control of, so imagine a future PMs expression with no way of getting supplies back on line?
I'm sure the recent global warming and green hype in the last two years is to get us prepared for what's to come in our lifetime, hoping to get people to save energy now, but by not causing recession, the world economy dependent on the west buying crap made with oil by-products. Western governments can't afford to discourage that, but they can make us cut out the waste-say like walking instead of driving our fat asses to the paper shop to get the Sun and ciggies. The only method that's been successful so far in cutting utility usage is expensive bills. We are just not prepared to save energy and resources if things are cheap and easy to get. And now that China is the sweatshop of the world, whole new cities springing up to make just single items like toilets and rugs, and so nick-named after their household products, there is going to be no drop of supply and demand any day soon. The only solution to stem oil usage is a word war or a complete change of ethos when it comes to the energy supplies we use. We know America pooh-pooh any energy saving initiatives because they are not prepared to let their economy suffer. So if the worlds biggest energy users don't care then why would anyone else?
The alternatives are out there but the nimbi middle class are not helping. They protest against the invasion of Iraq for oil yet won't let windmills or nuclear power stations be built nearby. Wave power is too expensive and bio fuels use one barrel of normal oil for every two veggie oils they create. At the end of the day there's no compromise and we are heading straight towards a catastrophic oil crises and no one wants to collectively deal with that fact. Maybe they wont because we cant, and the only resolution is to keep charging head long into the wall with our head down.
The answer is yes, obviously. Or is it?