You heard it here first: GAP OIL. I am coining this term since I haven't seen it used before but it succinctly sums-up the prevailing situation regarding the provision and price of oil. We hear much about peak oil, and often this is misunderstood to mean that the world will imminently run out of oil. However, this is neither the case nor the definition of peak oil. As I have commented recently here, Dr Richard Pike, the CEO of the Royal Society of Chemistry and a former oil-man, has made convincing arguments that there is more oil - about twice as much - to be recovered than the 1.2 trillion barrels worth that is generally accepted. That may well be true, but it does not impact on the rate of recovery of oil per se, which is the crux of the issue.
The world gets through around 84 million barrels of oil on a daily basis, which adds-up to just over 30 billion barrels a year... a staggering quantity which has provided the foundations of the modern industrialised globe and its relentless population of 6.7 billion souls. Only time will tell, to what extent that number will ascend to, but if the WHO is to be believed is will be over 9 billion by 2050 and rising perhaps to 12 billion in the subsequent century, all fed by oil. I have noted on previous occasions a Hubbert analysis, similar to that made for oil, that predicts instead that world population will rather peak at 7.1 billion by 2024 and then fall to around 2.5 billion by 2100. As I say, only time will tell us which manner of estimate is correct.
Demand for oil appears equally inexorable, and there are estimates that say in two decades China will be using more oil than the U.S., and that the world in total will demand another 50% by then. It is obvious that no matter how much recoverable oil there is in the ground, if it cannot be recovered at a sufficient rate to match the prevailing demand for it, then a gap will ensue between demand and supply, as happened last summer with the effect of driving-up the price of oil to almost $150 a barrel. This state of "gap-oil" will maintain a similar consequence: namely that the price of oil will soar from its present low value and the impact on the world economy will be severe, with oscillations of unparalleled amplitude to the global markets. There will be actual shortages of oil too, with supplies going to the highest bidder, and a shift of economic and political power being placed in those hands that hold the oil.
This will happen irrespective of whether we are at the peak of world oil production. The concept of world peak oil is misleading in any case, since all oil wells are at different phases of their relative depletion and for example Russia will still be producing oil long after the North Sea, for example, and Saudi Arabia long after that. Hence some countries will be dependent on others. World peak oil can be thought of as the peaking of the largest fields, and for example once the giant Ghawar field peaks we can begin to kiss our lifestyles goodbye. This should auger-in a new age of energy efficiency and a growing reliance on sustainable economies, necessarily localised and so less dependent on the current level of transportation, based around the bioeconomy, i.e. on what can be grown.
Technological solutions, e.g. the hydrogen economy will not be with us for decades if at all, and at the very least we need some interstitial solutions, most viably based on photosynthesis. Once peak oil does strike it will enlarge the gap further by drawing-down the supply side, which will fall ever consummately against demand. It is gap-oil we need to fear, the state when supply fails demand and which is both inevitable and imminent.
Gap oil is a good term.
The top story of the year is that global crude oil production peaked in 2008.
The media, governments, world leaders, and public should focus on this issue.
Global crude oil production had been rising briskly until 2004, then plateaued for four years. Because oil producers were extracting at maximum effort to profit from high oil prices, this plateau is a clear indication of Peak Oil.
Then in August and September of 2008 while oil prices were still very high, global crude oil production fell nearly one million barrels per day, clear evidence of Peak Oil (See Rembrandt Koppelaar, Editor of "Oil Watch Monthly," December 2008, page 1) http://www.peakoil.nl/wp-content/uploads/2008/12/2008_december_oilwatch_monthly.pdf.
Peak Oil is now.
Credit for accurate Peak Oil predictions (within a few years) goes to the following (projected year for peak given in parentheses):
* Association for the Study of Peak Oil (2007)
* Rembrandt Koppelaar, Editor of “Oil Watch Monthly” (2008)
* Tony Eriksen, Oil stock analyst; Samuel Foucher, oil analyst; and Stuart Staniford, Physicist [Wikipedia Oil Megaprojects] (2008)
* Matthew Simmons, Energy investment banker, (2007)
* T. Boone Pickens, Oil and gas investor (2007)
* U.S. Army Corps of Engineers (2005)
* Kenneth S. Deffeyes, Princeton professor and retired shell geologist (2005)
* Sam Sam Bakhtiari, Retired Iranian National Oil Company geologist (2005)
* Chris Skrebowski, Editor of “Petroleum Review” (2010)
* Sadad Al Husseini, former head of production and exploration, Saudi Aramco (2008)
* Energy Watch Group in Germany (2006)
* Fredrik Robelius, Oil analyst and author of "Giant Oil Fields" (2008 to 2018)
Oil production will now begin to decline terminally.
Within a year or two, it is likely that oil prices will skyrocket as supply falls below demand. OPEC cuts could exacerbate the gap between supply and demand and drive prices even higher.
Independent studies indicate that global crude oil production will now decline from 74 million barrels per day to 60 million barrels per day by 2015. During the same time, demand will increase. Oil supplies will be even tighter for the U.S. As oil producing nations consume more and more oil domestically they will export less and less. Because demand is high in China, India, the Middle East, and other oil producing nations, once global oil production begins to decline, demand will always be higher than supply. And since the U.S. represents one fourth of global oil demand, whatever oil we conserve will be consumed elsewhere. Thus, conservation in the U.S. will not slow oil depletion rates significantly.
Alternatives will not even begin to fill the gap. There is no plan nor capital for a so-called electric economy. And most alternatives yield electric power, but we need liquid fuels for tractors/combines, 18 wheel trucks, trains, ships, and mining equipment. The independent scientists of the Energy Watch Group conclude in a 2007 report titled: “Peak Oil Could Trigger Meltdown of Society:”
"By 2020, and even more by 2030, global oil supply will be dramatically lower. This will create a supply gap which can hardly be closed by growing contributions from other fossil, nuclear or alternative energy sources in this time frame."
With increasing costs for gasoline and diesel, along with declining taxes and declining gasoline tax revenues, states and local governments will eventually have to cut staff and curtail highway maintenance. Eventually, gasoline stations will close, and state and local highway workers won’t be able to get to work. We are facing the collapse of the highways that depend on diesel and gasoline powered trucks for bridge maintenance, culvert cleaning to avoid road washouts, snow plowing, and roadbed and surface repair. When the highways fail, so will the power grid, as highways carry the parts, large transformers, steel for pylons, and high tension cables from great distances. With the highways out, there will be no food coming from far away, and without the power grid virtually nothing modern works, including home heating, pumping of gasoline and diesel, airports, communications, and automated building systems.
It is time to focus on Peak Oil preparation and surviving Peak Oil.
There is much information in your message, and yes now is the time to prepare for the gap/peak... I quite agree!
You paint a pretty grim picture about the world's energy future. Even if the coming crisis is only half as bad as you portray, do you think we will be seeing resource wars in the future?
I can think of two potential areas of conflict right off the bat, such as the giant oil field right off of Cuban waters and not too far from Florida and the oil fields under the South China Sea which China desires.
I hate to see a world where larger nations use their might to steal the resources of smaller nations, ie like we tried with Iraq, but I am afraid we will be seeing more of that in the future. And in a world of dwindling resources it probably would be easier to mobilize public opinion for such operations.
although I try to keep a balance of views and as impartial as possible, yes as we are going on I think we will see more wars, over oil, maybe gas and certainly water at some point.
We are so dependent on oil and it is linked so closely to the economy that we can expect trouble. We are getting through so much oil, and I note this morning that the British government has agreed to the third runway at Heathrow Airport, although it won't be finished until; 2020.
But what will the cost of fuel be by then and how short will its supply be? Planes are one type of vehicle that does need oil-based fuel - or lots of biodiesel, but thinned so that it stays liquid at the cold temperatures up there in flight. Providing the latter in any serious amount competes with growing food, so it is limited how much can be provided.
I think that by then there will be conflict in various parts of the world over resources, and the number of both road and air vehicles will have been reduced considerably.
Unless there is reality in vacuum energy or some other technology the only way around this is to relocalise civilization so that we can get by with much less in the way of transport and build local economies.
An article that describes how Europeans use AE and how these apply to North America - renewable energy and carrier/storage technology:
Yes, there is life after oil
Three North American firms - no ads intended, but all sites listed below have an FAQ - providing installable, removable insulation panelling or similar usage with varying degrees of flexibility:
http://www.sumcan.com/faq.html (firm based in Alberta, Canada)
http://www.coverflex.net/ (Texas, USA)
http://www.p2000insulation.ca/faq.php (throughout Canada)
The time to act is now, as never before!
Nice one, George!
All those potential electrioc and hybriod cars, but how long will it take to make them all compared to the number we now have? What about the planes, or do we leave them oil for them exclusively?
The British government have given the go-ahead for the third runway at Heathrow, but what will they be putting into planes by way of fuel when it opens in 2020? Will we have a society left by then... or any banking system, money at all... or will we be back to the old "barter system".
I stayed with my dad at the weekend... he was a bit morbid but promised me his very extensive collection of tools etc., from welding equipment, hand-tools, a jack-hammer, every kind of spanner, wrench, drill, and on and on... "when the time comes".
I am beginning to think they might come in very handy.
Hi, Chris !
Gap Oil ? Mm … I prefer to stick with the concept of Peak Oil (although modified from the original definition by King Hubbert) and would rather associate the word “gap” with the word “capability”, such an association being applied to money-lending, investment and population-carrying (each of these three capabilities being closely entangled with the two others).
Let us assume, to begin with, that we have now reach Peak Oil, as Clifford J. Wirth tries to persuade us with solid arguments (in the first comment of this post).
If that is the case, we have just reached or are about to reach what will probably be considered by future historians as the culminating point of the whole human history.
From the beginning of the industrial civilization and until this point (with a strong acceleration after World War II), as expansion kept being the dominating trend observed in our world, the global financial system worked as a big inflating bubble more often kept under pressure than subjected to temporary depression. In such expanding world, a sufficient number of investors were able to borrow money, make profits and reimburse their debts (+ interests), allowing in this way the banking system to create and lend increasing amounts of circulating money within a capitalist system most of the time able to perpetuate world economic and population growths. While one part of the newly created money allowed to pay dividends or wages to a growing number of people able to buy a growing amount of consumer goods or acquire a growing amount of capital assets written down somewhere in the global inflating bubble, another important part was invested so as to increase year after year the annual energy production needed to feed such never-seen-before fast expansion.
But now a major proportion of cheap oil revenues escapes from the oil industry management and is mainly devoted to sustaining world growing populations. Global Peak Oil is not just a geological fact (as was US Peak Oil about forty years ago). It stems from cheap oil depletion combining with complex geopolitical factors, with the fact that what is left for new energy investments does not allow to increase world production, with the question of taking or not taking into account the additional costs implied by the expressed will to limit CO2 emissions, with the stress generated on investors by the feeling of uncertainties, and possibly with many other factors I am not aware of.
Defined in this way, Peak Oil is the threshold beyond which contraction will probably become the new general trend operating within a newly born world. With the disappearance or rarefaction of expanding markets and with solvent investors becoming few and far between (leading to shortages of commodities, food, circulating money, …), the money-lending, investment, and population-carrying capabilities will probably dramatically shrink. And I think it will make sense, if such a fact concretizes, to define it as Gap Capabilities.
Today is a day of hopes, as many people in the world want to believe in Barack Obama. He surely is intelligent, smart and charismatic, and that alone will bring a great change at the head of the more powerful country in the world. No further comment.
[Intelligent, smart, charismatic … So was probably the real Jesus when he triumphantly entered into Jerusalem, almost a thousand years ago, some times before being crucified.]
But tomorrow the new President will have to face the brave new world shortly described in a cartoon posted by The Economist.
my point is that the gap will emerge anyway even before the peak in Hubbert terms, but the actual arrival of the peak will make it worse.
I don't disagree with anything you day and I am impressed by Clifford's arguments too.
I guess that the summing-up id that we can't get hold of enough oil to match w0rpd consumptio0n for much longer and we have to decide how to get by with less of it.
Now that's the tricky part, but the most pressing.
I juts sent this article to scitizen.com too, as I think it might stimulate further discussion as to what exactly the challenges are that face humanity.
I find the cartoon highly appropriate.
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