A Curious Phenomenon
It's now in the WSJ.
Potential Energy Crunch May Bring Other Fuels to Fore
By BHUSHAN BAHREE
World oil and gas supplies from conventional sources are unlikely to keep up with rising global demand over the next 25 years, the U.S. petroleum industry says in a draft report of a study commissioned by the government.
In the draft report, oil-industry leaders acknowledge the world will need to develop all the supplemental sources of energy it can -- ranging from biofuels to nuclear power to oil extracted by unconventional means from the oil sands of Canada -- to meet soaring demand.
The surge in demand is expected to arise from rapid economic growth in such fast-developing countries as China and India, as well as mounting consumption in the U.S., the world's biggest energy market.
The findings suggest that, far from being temporary, high energy prices are likely for decades to come.
"It is a hard truth that the global supply of oil and natural gas from the conventional sources relied upon historically is unlikely to meet projected 50% to 60% growth in demand over the next 25 years," says the draft report, titled "Facing the Hard Truths About Energy."
"In geoeconomic terms, the biggest impact will come from increasing demand for oil and natural gas from developing countries," said the draft report, a copy of which was reviewed by The Wall Street Journal. "This demand may outpace timely development of new supply sources, thereby pressuring prices to rise."
The study, which was requested by U.S. Energy Secretary Samuel Bodman in October 2005, was conducted by the National Petroleum Council, an industry group that advises the secretary.
The conclusions appear to be the first explicit concession by the petroleum industry that it alone can't meet burgeoning global demand for oil, which may rise to as much as 120 million barrels a day by 2030 from about 84 million barrels a day currently, according to some projections. (U.S. gasoline prices are on the rise. See related article.) more
Jerome a Paris, an often contributor to Kos, responded to the report with these words:
Coming on the same day that the price of oil, as quoted in London, reached the records set last year (with a barrel reaching $78.40, vs a all-time-high of $78.65) and that the International Agency published yet another worrying report stating that "global oil consumption is forecast to reach 88.2m barrels a day, up 2.2m b/d [2.5%] from 2007", it is yet another sign that we are coming closer to the wall in our mad rush to burn ever more oil."
And as we push 80 dollars a barrel can 100 dollars a barrel be that far away?
In the meantime, stocks move steadily upward with the Dow 3000 points above its close just 9 months ago.
Not only has the market not integrated climate change, it has not taken in resource depletion into its pricing.
This para-psychotic behavior brings Kunstler to opine:
A curious phenomenon worth attention from pathologists in the financial press is the now nearly complete de-coupling of the finance sector from the salient ominous trend in the oil sector: the fast-developing permanent oil export shock. By that I mean a severe decline in export ability by those nations currently supplying the US, Europe, China, and Japan -- an export decline that will far exceed actual production decline rates in Saudi Arabia, Russia, Venezuela, the North Sea, Mexico, and Iran.
This story or scenario developed by Jeffrey Brown and statisticians at The Oil Drum.com, is pretty easy to understand: production declines in these nations will combine with greater internal oil consumption to severely curtail exports in a shockingly brief time frame. The populations of Saudi Arabia, Venezuela, and Iran are growing; car sales in Russia are up 50 percent this year; even Norway is using more of its own oil every year.
These nations are consuming about 25 percent of their total liquids (regular crude plus natural gas liquids and condensates). Basically, the picture shows that net exports from these nations will run to zero in nine years. And they will be low enough within five years to throw the importing nations into complete economic paralysis." more
Even Kenneth Deffeyes is amazed that "it looks as if we will go through another US presidential election with no candidate calling attention to the world oil problem, or to the North American natural gas problem."
Yet, the markets roar.
And our Nero plays.
As our Institutions fail.
Labels: Peak Oil