Mr Oil is already making a long, slow exit. You might not be seeing it though…

Posted by steve on July 5, 2009

Since the end of the First World War, oil has been flowing into almost every aspect of our daily lives: as fuel, as basis for chemicals, as plastic, fabrics etc. In fact today, it is hard to think of a product that does NOT contain a large portion of oil or oil energy.

Oil is such a compact source or energy – one cup is enough to pull a small car up the Eiffel tower. Compare that to a chunk of wood the same size – it is mostly water! As I write this there is no known source of energy that is so convenient, compact and easy to transport, that can power the millions of vehicles and machines all over the world.

If you think that oil will be available to drive business indefinitely, think again. The fact is, oil is just not being found any more in large quantities. And we are using more than is being found.

THIS IS GOING TO FUNDAMENTALLY ALTER THE WAY WE  LIVE,  DO BUSINESS AND THINK – WITHIN THE NEXT DECADE.

The long exit was first announced in 1956 by petroleum geologist M King Hubbert. He calculated the US would peak in 1970 and the world around 2000. The long exit started in 1964 when world oil discoveries peaked. Since then, year on year, less oil has been discovered. There have been no significant discoveries of new oil since 2002. In 2001 there were 8 large scale discoveries, and in 2002 there were 3 such discoveries. In 2003 there were no large scale discoveries of oil. For every year since the mid 1980s, annual production has been greater than annual discoveries.

Since 2005, there has been no real increase in world oil production, remaining at around 85 million barrels a day. But it gets worse. The oil remaining in the ground is harder to get. The easy stuff was extracted long ago. At the beginning of the oil age the equivalent of one barrel of oil invested would bring you 100. Nowadays, depending on the oil field, it is between one and 18 you get back.

Many argue I am overstating the case. But many, most even, are heavily invested in Business As Usual and would be hit negatively if people started to change their ways.

Advice:

When planning your business, daily life and investments, factor in decreasing availability and increasing price of oil. Oil prices dictate energy prices so this applies to all energy sources, even renewable ones.

Things to look for:

Where am I or my business vulnerable? To what extent is my business or my daily life reliant on uninterrupted supplies of oil based products? What alternatives are available now? What services do I rely on that might be increasing in price soon?

World oil production and consumption set to fall

Posted by steve on April 26, 2009

It may sound incredible, but there HAS to be a finite amount of oil in the world. The figures here are based on what is already discovered and what is thought to be available. And they are finding  less and less oil by the year.  So with the world population slated to grow by another 30-40 % up to 2050, we can see coming generations are not going to have the opportunities for cheap and easy energy supply that we have enjoyed.

From now on, energy constraints are going to upset most business plans and probably make the world hunger problem worse, as a lot of fuel is needed for modern agriculture.

Even though estimates of remaining oil vary, they all mean the same thing: we are on the other side of the slope. Never again will we see the current  levels of oil production per capita.

What will this mean for our way of life? For the economy? It is an opportunity to rethink money and to innovate. What could this look like? Sign up for updated by e-mail or come back.

In the meantime, the world fossil fuel output per capita is discussed at length on the Oil Drum.