COMMENT: We’ve examined the Peak Oil propaganda phenomenon in several past broadcasts. Based on the notion that the world is running out of oil, it has been used as justification for casting aside environmental concerns, raising prices and imposing draconian social programs to deal with the “emergency.”
As we saw in FTR #506, the petroleum companies have been saying the world has been running out of oil since the 1920’s. (That was the justification for the development of the Fischer/Tropsch process to synthesize oil from coal.)
The epicenter for the Peak Oil ideology is HIS Energy Group, a subsidiary of Thyssen/Bornemisza industries, which draws its conclusions based on data fed to them by the very companies that benefit from the dissemination of the theory.
It is no coincidence that Thyssen/Krupp bought the Leuna hydrogenation plant, originally built by I.G. Farben during World War II to synthesize oil utilizing the Fischer/Tropsch process.
The fear mongering over Peak Oil has been used to propose a Nazi-linked social agenda.
For now at least, the oil companies and their amen chorus have relaxed their propaganda, seeing plenty of oil for decades to come.
It will be interesting to see how long this “Petroleum Propaganda Ploy” remains dormant. When prices get too low, or environmental restrictions too high for the liking of the oil barons, don’t be surprised to see it reemerge.
In passing, I will note that I am fundamentally critical of the fossil fuels industry–two thumbs down on oil. We should be going full speed ahead to develop renewal energy sources. Many pro-environment advocates have been suckered by the peak oil phenomenon, seeing it as a “green issue.” It is nothing of the kind.
EXCERPT: When Daniel Lacalle, in his early 20s, took a job with Spanish oil company Repsol YPF SA in 1991, friends chided him for entering a field with no future. “They all said, ‘Why do you want to do that? Don’t you know only 20 years of oil is left in the whole world?’ ” he recalls.
Two decades and four energy crises later, the U.S. Geological Survey estimates that more than 2 trillion barrels of untouched crude is still locked in the ground, enough to last more than 70 years at current rates of consumption. Technological advances enable companies to image, drill and shatter subterranean rocks with precision never dreamed of in decades past. Trillions of barrels of petroleum previously thought unreachable or nonexistent have been identified, mapped and in many cases bought and sold during the past half decade, from the boggy wastes of northern Alberta, to the arid mountain valleys of Patagonia, to Africa’s Rift Valley.
“Betting against human ingenuity has been a mistake,” says Lacalle, who today helps oversee $1.3 billion as a portfolio manager at Ecofin Ltd. in London. “The resource base is absolutely enormous, so much so that we will not run out of oil in my lifetime, your lifetime, our children’s lifetimes or our grandchildren’s lifetimes.” . . .
More on the death of peak oil
http://www.theregister.co.uk/2012/02/23/peak_oil_is_dead_citigroup/
https://www.citigroupgeo.com/pdf/SEUNHGJJ.pdf
Heh, the US is currently exporting so much oil that we now have Thomas Friedman asking the question “Should the US join OPEC?”.
Peak Water, coming to a future war zone near you. Actually, there’s nothing to worry about...the water wars aren’t expected start for another decade. That should be plenty of time to prepare for the loss of a vital resource:
This is one of those articles that’s a reminder that the collapse of the ecosystem may be bad for just about everything and everyone but it’s great for
war-profiteersbusiness!@Pterrafractyl: Sad but true. One must wonder how soon these ‘water wars’ could start........and just how bad terrorism could really get. Possibly even a nuke or two being exploded, over say, Tel Aviv or Cairo? Not pleasant stuff to think about. =(
At least “peak-diamonds” shouldn’t be an issue for humanity any time soon:
It will be interesting to see what, if any, impact this has on the price of diamonds because it’s not like there has been anything remotely approaching a “free-market” in diamonds for a long time.
Then again...
Peak oil...it’ll be here soon enough...any century now...
The relationship between the US oil-shale boom and stability in the Middle East is going to be something to watch going forward. If Saudi Arabia is going to be dependent on $80+ a barrel just to finance its own social spending projects and ward off its own “Saudi Spring”, what’s going to happen if the price of oil really does fall to $50. There are a lot of nations that rely on billions in Saudi foreign aid and they may respond well to peak aid
Keep in mind, though, that while “peak petro-aid” could lead to greater regional instability, that petro-aid wasn’t always for financing stability:
How to murder the future in one simple step:
Step 1. Do nothing.
All done!:
Just in time for a potential tar sand oil export boom to EU: The petroleum industry wants you to know it’s been systematically overestimating how much oil is down in those tar sands:
Could this be a legitimate revision? Is Peak Oil back, at least according to the industry? Did it ever leave? One thing is clear: The peak cost-to-benefits ratio for humanity’s energy addiction is nowhere in sight.
Here’s an article about how the plunging price of oil isn’t really threatening to drive the oil shale industry out of business, as is often suggested. It’s merely threatening to ensure that the North American oil shale industry is even more concentrated in the hands of the big boys with deep pockets once the shakeout is over:
And here’s an article that highlights one of the driving forces behind the expected consolidation: While prices may be falling, the costs are falling too:
“Why such gradualism? Rather than chase near-term cash flow, Mr. Tillerson said Exxon has been putting itself through shale class, learning “how to get the most out of these rocks in the most cost-efficient way.”
That represents a bearish trend that will weigh on oil prices for years to come. Exxon says its costs in the Bakken have dropped by 20% to 25%. So, many prospects that made sense at $100-a-barrel oil still make sense now, the company says.“ ‘
That’s all part of why we might expect to see quite a bit of consolidation in the oil shale sector the longer these prices stay low: when prices are too low for Exxon’s small competitors, but not too low for Exxon and its larger peers, consolidation is pretty much inevitable.
So is the “wildcatter” phase of the great North American oil shale boom about to come to an end, with the ushering in the inevitable era of Big Oil domination? We’ll find out. But here’s a reminder that, while North American oil shale is clearly a growing segment of Exxon’s portfolio, North America is not where the future of Exxon’s growth lies. Oil shale, as a driver for Big Oil revenue growth, has competition:
“Taking the long view, Exxon boosted its Russian holdings to 63.7 million acres in 2014 from 11.4 million at the end of 2013, according to data from U.S. regulatory filings. That dwarfs the 14.6 million acres of rights Exxon holds in the U.S., which until last year was its largest exploration prospect.”
As we can see, despite the low oil prices, there’s no shortage of new prospects for the big boys. Try to enjoy the good news.
FYI, if you’re living in one of the many regions of the world facing the growing threat of ‘peak water’ and just assume that you’ll be able to build a giant pipeline and buy the water from elsewhere, keep in mind that it’s going to be a seller’s market: