If you don’t believe in arithmetic — if your political or religious tenets require you to deny that 2 + 2 always equals 4 — then by all means stop right here and go read something by Glenn Beck. For the remaining minority, then, of people clinging to outmoded faiths in things like gravity and mathematical truth, here’s the headline: we are running short of oil. There is no renaissance, no triumph of technology, no sudden reversal of the rules of the universe. And it is still true that running short is almost as bad as running out.
If your information about our petroleum prospects comes from TV, it came from the oil industry. Increasingly, however, other sources, both in government and private industry, are getting severe heartburn about the fraud the oil industry is maintaining. Some recent examples:
- An analysis by the global banking and insurance behemoth Citigroup (reported by Bloomberg) finds that Saudi Arabia may be unable to export any oil by 2030. If the little hairs on the back of your neck did not stand up when you read that, read it again. It says that by the time today’s infant is a senior in high school, ten per cent of this country’s oil supply will be offline. Permanently. And this Citigroup analysis does not assume any decline in Saudi production, which is highly likely. It simply observes that the skyrocketing demands of the Saudi population will by 2030 be consuming all the oil it can produce. Factor in the likely decline in production (as Oilprice.com has done) and the spigot gets turned off in 2022.
- Another mathematics-based investment bank, Barclay’s, has looked at the net effect of the much-hyped oil and natural gas “boom” in the United States and estimates it to be, on a scale of one to ten, about zero. Barclay’s also looked at the prospects for energy independence as trumpeted by the Romney campaign and has estimated the likelihood at — zero. (Glenn Beck take note: wasn’t zero invented by Arabs? Should Christians believe in it?)
- According to a climate research center in Norway, the Arctic, even if it is to be ice-free quite soon, will not be the last best hope for continued oil gluttony. Because of difficult conditions and prohibitively high production costs. Arctic oil’s impact on the global market through 2050 — about zero.
- Reports out this week from the US Geological Survey and the Society of Petroleum Engineers use arithmetic to estimate the amount of recoverable natural gas and oil that can be taken from the shale formations being credited with a new petroleum renaissance in America. You can work through all the numbers in reports done for Energy Policy Forum here and here, but the general idea: the amount of oil we can realistically expect to see from these bonanzas is in the area of one-fourth, as in 25 per cent, of the amounts being touted by the oil and gas industries and their subsidiary, Mitt Romney Inc.
- When Romney promises energy independence, he sometimes remembers to qualify it as “North American energy independence,” because of course the idea of the United States achieving energy independence is so ridiculous that even he….oh, never mind. Anyway, the rosy picture requires Mexico, our third largest supplier of oil, to hang in there. But according to CNN Money last month, Mexico’s oil production peaked in 2008, has fallen below three million barrels per day, and continues to fall fast. As a result, the US will soon have to depend even more on its number two supplier, Saudi Arabia. See above.
Logic and mathematics tell us that the end of cheap and plentiful oil, now clearly in sight, will be among the most traumatic events in human history. Only a fossil fool would ignore it.