BLACK MAGIC. During the last century oil has transformed the world. British coal launched the Industrial Revolution, but American oil put the pedal to the metal. No other material has so profoundly changed the face of the world in such a short time. Petroleum is black magic, the lifeblood of our civilization. The petroleum industry provides 40% of the globes energy and is humanitys largest commercial enterprise. Oil is our most concentrated, flexible, and convenient fuel. Without petroleum there would be no automobile industry, no tourism. Without petroleum 2% of Americans could not feed the remaining 98%. But oil is more than energy. Its the key feedstock for plastics, medicines, clothing, pesticides, paint, and thousands of other products. Fueling Toyota or fabricated into Tupperware, petroleum is the worlds premier commodity. Soon, experts say, world oil production will reach an all-time high, an apex, a peak. Then, after a short plateau, it will decline forever. What historians will someday call the Oil Era will last just two centuries. In 1998 we are closer to its end than its beginning.
THE OIL TRIBE. In 1859 oil was struck in Pennsylvania. The magic fluid unleashed Yankee ingenuity, put America on wheels, and helped to create the worlds richest superpower. The transformation was unimaginably swift: In 1859 Americans traveled on horseback; in 1969 they drove Mustangs and flew to the Moon. Today it is difficult to overstate oil's importance to our economy. Four percent of the world's people, we use 25% of the world's oil. We are an Oil Tribe, the Petroleum Clan, imbibing about 3 gallons per person per day. The automobile is our most cherished icon, a new car our symbol of success. The local gasoline station is our secular temple where each week 150 million Americans "fill er up." An average American drives 1,000 miles a month, 12,000 miles a year, the distance to the Moon every 20 years. The Oil Tribe numbers 265 million. Together we weigh about 34 billion pounds. Hungry for speed, addicted to motion, we consume our weight in petroleum every 7 days.
BLESSED BY GEOLOGY. Cheap
oil has always been an American birthright. Through fate and geology, the
United States was extravagantly blessed. Our original cargo was about 260
billion barrels; only one country, Saudi Arabia, had more. Oklahoma alone
possessed more oil than Germany or Japan. California had more than Germany,
Japan, France, Spain, Denmark, Sweden, Finland, and Italy combined. The
U.S. hasor rather had20 times as much oil as India, 16 times as
much as Brazil, 3 times more than China. From 1859 to 1939 the U.S. produced
two-thirds of the worlds oil. After Japan attacked Pearl Harbor in oil-starved
desperation and Hitler failed to capture Russias Baku oil field, American
petroleum, and the industrial output it nourished, triumphed in World World
STRENGTH THROUGH EXHAUSTION.
As recently as 1950 the U.S. was producing half the worlds oil. Forty-eight
years later, we dont produce half our own oil. Domestic production
peaked in 1970, 27 years ago, and today we produce just 45% of the
crude we consume. To fuel our economy weve drilled more and pumped longer
than any nation on Earth, pursuing an oil policy thats been called "Strength
Through Exhaustion." Although the U.S. remains the worlds third largest
producer, about 65% of our petroleum has been burned. Its downhill from
LIKE DEATH AND TAXES. Perhaps for the same reason that State Farm sells life insurance rather than death insurance, oil companies shun phrases like extraction and depletion. Instead they prefer production, as in "Chevron produces oil." This implies that we can manufacture oil at will, the way we do jeans or computers. In truth, petroleum reserves are finite and depletion is a reality like death and taxes. Oil fields have been compared to track athletes whose best performance comes early in life. After a youthful sprint upwards, production peaks, plateaus, declines, and ends. Chevron speaks of the U.S. as "mature" or "aging." Thats mature, in the same way that 75 year-old golfer Arnold Palmer is mature. Tiny Kuwait, smaller than New Jersey, has three times the reserves of the entire U.S. To better grasp the concept of depletion, consider Pennsylvania.
PENNZOIL. Our most famous motor oil honors the state where the Oil Age began. Prior to the invention of the automobile, most oil was burned in kerosene lamps. For the first 25 years of the era Pennsylvania was the worlds leading producer. (John D. Rockefeller coined Americas largest fortune by cornering the Pennsylvania market.) In 1891 the Quaker State produced enough oil to light the U.S. for 7 months. In 1937, when its production reached a second lower peak, Pennsylvania supplied enough to run the now motorized country for 7 days. Today the states oil could power the U.S. for only 3 hours. Although there are still 19,000 wells in Pennsylvania, collectively they produce a puny 6,900 barrels each day. In contrast, Saudi Arabia produces 8 million barrels1,100 times as muchfrom just 1,400 wells.
GUSHERS IN TEXAS. As oil prospectors, some of them retired whalers, continued
to harpoon the Earth, oil was struck in New York, Ohio, Oklahoma, and then,
Texas. Texas was a gusher, Americas first world class find. If Texas had
been a sovereign country, its oil riches would have placed it in the worlds
top ten. The states original reserves were 6 times greater than those
of India, 4 times greater than Brazil, twice as large as Norway. Texas
was big, as big as the braggadocio it came to symbolize. As thousands of
men made fortunes in the oil patch, a new social class arose: the "oil
millionaires." The Hunt brothers, George Bush, and Lyndon Johnson all made
money in Lone Star oil. For the last 70 years the state has been Americas
leading oil producer. But production in Texas peaked in 1972 and has been
declining rapidly since. According to the American Petroleum Institute,
about 80% of all the oil that will ever be produced in Texas is gone. This
is not an anomaly. Thirty-one states produce oil and all are past their
peaks. Oklahoma peaked in 1927, Colorado in 1956, Wyoming in 1970, Alaska
SWISS CHEESE. Well, ok, if Pennsylvania and Texas are played out, why not drill more wells somewhere else? In fact, the U.S. is already one of the most thoroughly explored and drilled countries on Earth. Of the 4.6 million wells worldwide, 3.4 million have been drilled in this country. Very very few prospects remain. With the exception of the Arctic National Wildlife Refuge and a few deep water basins, weve been there and done that. From the oil industrys perspective, the U.S. is Swiss cheese.
THE LAST HURRAH. The oil industry employs many smart, inventive, and creative people. In a quest to find more oil, the industry has developed a host of new exploration techniques, computer imaging software, and drilling methods. Many are being put to good use in the Gulf of Mexico. There, the oil majors are drilling in 5,000 feet of wateran astounding factwith the likelihood that they will soon sink wells in 10,000 feet. Analysts expect the Gulf to be Americas last great bonanza. A mile under the ocean floor may lie 15 billion barrels. Its a lot of oil, but only as much as the nation uses every 2.5 years.
ELEPHANTS. Ghawar. Burgan. Safaniya-Khafji. Zakum. These are the strange,
unfamiliar names of the four largest oil fields in the world. Oil occurs
rarely in nature and when it does its often concentrated in large amounts.
About 70% of the worlds petroleum is found in 370 giant fields, nicknamed
"elephants" because they are so huge. Western civilizationlife as we know
itis based on these elephants. In part because they are so big, the elephants
were easy to find and inexpensive to produce. (To get oil out of Ghawar,
for example, costs the Saudis less than $1 per barrel.) The discovery rate
for elephants peaked in the 1960s. Its getting harder and harder to find
new ones. Indeed, many geologists believe that elephants are nearing extinction,
that only a handful remain unfound.
THE COMING PEAK. In the same way that U.S. oil production peaked in 1970, global production is destined to peak during the first two decades of the coming century. Some analysts expect a peak around 2005; some suggest it will be 2010; others believe it will come as late as 2020. The exact date cant be predicted, since it will depend as much on economic and political factors as on geology. The biggest wild card? Saudi Arabia, the worlds most prolific oil province. If the Saudis invest hundreds of billions of dollars they could double their output to meet expected demand. But they may decide not to double production, choosing instead to produce somewhat less oil and charge more for it. Although predicting the peak is impossible, this great turning point is imminent.
COLLISION IN SLOW MOTION. A decline in world oil production? The thought takes some getting used to. What seems impossible is inevitable. The crunch may arrive suddenly. Or in slow motion. As Reagans former Energy Secretary Donald Hodel says, "Were sleepwalking to disaster." When it happens, journalists will shout, "Were running out of oil." Thats not true. Rather, we are running out of cheap oil. After production peaks oil still will be readily available at a higher price, though in slowly declining amounts, for at least 50 years. What we face is not a short-term crisis but a chronic shortfall. No one will freeze in the dark (America still has a century of coal and 50 years worth of natural gas), but the transition to more expensive oil could be bumpy.
CRUDE CRUNCH. As global oil production nears the peak, oil prices will rise, perhaps overnight with staggering impacts on the global economy. This absolutely predictable, absolutely inevitable oil crunch will likely have tremendous economic impacts. Hitting as the Baby Boomers retire, it could rock our economy, psychology, and sense of self.
GIMME THAT OIL TIME RELIGION. Of course, not everyone agrees that we face an imminent crisis. (In part, it depends on how you define "imminent." Some people define it as "before Im dead.") Business Week recently ran a cover article on global oil. The take home: dont worry, be happy, Exxon has you covered. (Call CORE for a reprint.) Energy Secretary Pena talks hopefully about "reversing the decline in U.S. oil production." This is whistling past the graveyard. Theres not that much oil left to find in the U.S. Thats why the oil majors are trying to muscle in on Russias Caspian Sea, 9,000 long miles from home. How the Caspian qualifies as "our oil" Im not sure. The Chinese need it as badly as we do. Nonetheless, Henry Kissinger and Dick "Desert Storm" Cheney are lobbying to gain U.S. companies preferential treatment.
ASLEEP AT THE WHEEL. There are many ways to soften the inevitable transition to a world in which oil is more expensive. They include more efficient cars, smarter land use planning, mass transit, and alternative fuelsbut we won't begin implementing them, at the local or national level, until we recognize that a grave problem looms. At the moment, this nation is asleep at the wheel. Time is short. If we want to retool our transportation systems, a world oil peak in 2010 or even 2020 is next month. A peak in 2005 is a train wreck tomorrow. But few are talking about this predictable development. Even fewer are planning for it.
In 1900 oil married the automobile. Together they gave birth to a century
of travel. Today oil is so thoroughly woven into the fabric of America
that we cant imagine life without it. Fish dont worry about water and
Americans dont worry about oil. Instead we swim in it. Think of your life:
the kid schlepping, commuting, and errand running. Skiing on the weekend,
Thanksgiving at moms, a conference in Chicago, a jaunt to Vegas or Lake
Powell, a Sunday drive to Grand Junction. I know middle-class Coloradans
who do their Christmas shopping in Minnesota at the Mall of America. Texans
drive 1,000 miles to shoot a Colorado elk, hunting-and-gathering taken
to new extremes. Oil is fundamental to agribusiness: the average potato
travels 750 miles. How long have people in Colorado been eating bananas
grown in Guatemala and beer brewed in Germany? How much longer do you think?
Will driving a Saab to Moab to go mountain biking be a weekend option in
2050? By then Saabs will get 80 miles to the gallon and so it might be.
Then again, maybe not.
FROM THE CRADLE TO THE GRAVE.
half the worlds oiland 70% of U.S. oilwill be consumed during a single
human lifetime. That span happens to coincide with the Baby Boomer generation
born after World War II. The graph at left shows the phenomenon. The Boomers
were conceived as auto culture kicked into overdrive. As newborns, they
were driven home from the hospital in a car. They grew up listening to
songs like Mustang Sally and Little GTO. Getting a drivers
license was their rite of passage. During their lives many Baby Boomers
will drive and fly a million miles, equal to 40 trips around the globe.
Magellan and Amelia Earhart were the famous circumnavigators of their day.
Now every man is Magellan, every woman Amelia.
SLICING THE PIE. Geologists estimate that U.S. oil production will ultimately total 260 billion barrels. A sliver of that pie was consumed between 1859 and 1949, the first 90 years of the Oil Era. A much larger sliceif we can call 70% of the pie a slicewill be used between 1950 and 2025. Our grandchildren and their kids kids will inherit whats left. By 2025, when U.S. population will exceed 300 million, just 15% of U.S. oil will remain.
SNOOZE YOU LOSE. When
our grandchildren ask where all the oil went, how will we answer them?
Were engaged in a one-time hydrocarbon feeding frenzy the likes of which
the world has never seen before and will never see again. As someone who
once drove a pickup truck to Patagonia I may not be the best person to
ask, but is there a neglected ethical issue here? About a year ago I was
standing on Main Street in Aspen when a semi drove by. Emblazoned in large
letters on the side was a question: WEVE SHOT ALL THE BUFFALO NOW WHAT
DO WE DO? In 1872 there were 15 million bison roaming the Great Plains.
A decade later only a thousand were left. Pelt hunters had ruthlessly slaughtered
the rest. The heedless waste, the bloodthirsty savagery seems criminal
today. I wonder if future generations will view our pell-mell liquidation
of oil, arguably Earths most valuable resource, as equally senseless,
shortsighted, and greedy. If there were a ready substitute that would be
one thing. But there isnt. In fact, there is no substitute for oil in
the ways and volumes in which we use it today. Petroleum is a gift of geology,
a one-time windfalland were spending it like theres no tomorrow.
LYRICS. Everyone has their favorite car song. Daddy took my T-Bird away Every woman I know is crazy about an automobile Ive got the fastest wheels in town . Mustang Sally, you better slow your Mustang down I drove my Chevy to the levee, but the levee was dry Oh Lord wont you buy me a Mercedes Benz. My friends all drive Porsches, I must make amends
CAR BOMB. You hear about the population explosion. And yes, the population has doubled from 3 billion to 6 billion since 1950. In the same period, car numbers shot up from 50 million to 500 million. Cars, in other words, are reproducing five times faster than people. Theyre breeding like (VW) Rabbits.
WHO WILL FUEL CHINA? America was first to enter the Oil Age. We got a 60-year headstart on most nations. The developing world is racing to catch up. From Asia to Africa, three billion people crave the automobile lifestyle. Who can blame them? Mobility is wonderful. GM, Ford, and Toyota are building new plants in China, India, and Thailand. But Asia is oil poor. India has almost no oil. High hopes for new discoveries in the Tarim, a frontier basin in western China, have not been realized. The Chinese national oil company is investing in Venezuela, Gulf of Mexico, and Caspian Seaa telling vote of no confidence in prospects at home. Without large domestic reserves it will be impossible for China and other densely populated countries to develop an oil-intensive lifestyle like Americans enjoy. If India and China used as much oil per person as we do, world production would have to triple. It cant; theres not enough oil. But if it could, all the globes remaining oil would be consumed within 20 years. After that well, you wouldnt have to worry about your next car payment. Looking ahead, the tremendous inequities in oil distributionand consumptionare morally troubling and militarily worrisome. As oil depletion spreads worldwide, by 2015 five nations in the volatile Middle East will produce half the worlds oil. As more Asians take to the road and demand outstrips supply, oil prices will rise. Economic jousting for oilwho can pay mostis certain. Military confrontation cant be ruled out. With America using three times more oil than any other nation, future generations of young Americans may again take to the battlefield for oil.
REALITY CHECK. Which nations have oil and which nations use it? Fully two-thirds of the worlds oil is in five Muslim countries. The chart at right explains why Iraqs Saddam Hussein gets press, why the State Department frets about Iran, why the U.S. military did not leave Saudi Arabia after the 1990 Gulf War, and why we fought that war in the first place. (George Bush: "Our way of life is at stake.") Americas future, Japans future, Europes future, Chinas future, Europes future all are inextricably linked to the Middle East. In the deserts of Saudi Arabia, the U.S. military is building fortified air bases. Ostensibly we are there to protect our Saudi friends. In reality, we are an occupying force protecting our access to their oil. Some Saudis are resentful of our presence, as we would be if they were building air bases in Nevada. Would we leave their county if asked? I wonder. My son is 7. Hell be 18, fighting age, in 2009, about the time an Oil Crunch may arrive.
OPEC REDUX. As the U.S.
produces less oil, we must import more. Indeed, America imports
more oil than any other nation uses. Uncle Sams appetite is humonguous,
verging on gluttony. We import more than Denmark, Finland, France, Germany,
Greece, Italy, Norway, Spain and Sweden collectively use. And why not,
because at $15-$25 a barrel, imported oil is a steal. The tab for 1997
came to $67 billion, less than 1% of the nations gross domestic product.
The bargain may not, indeed can not, last. As global population and oil
demand rise, more and more people will be competing for less and less oil.
By 2015, only a handful of nations will be exporting significant quantities,
and a revitalized Organization of Petroleum Exporting Countries, our old
OPEC nemesis, will be in drivers seat again, able to control prices at
will. Since Saudi Arabia, Iran, Iraq, and Kuwait can sustain their projected
production past 2020, the world will not suddenly "run out" of oil. But
$16 a barrel will be a thing of the past.
SPORT UTES. In recent years, as oil prices have plummeted, Americans have fallen in love with gas guzzling minivans, light trucks, and sport utility vehicles. In Seattle Microsoft millionaires drive Humvees. Light trucks and sport utes command 45% of the new car market in the U.S., a powerful trend aimed in exactly the wrong direction. That these vehicles sell well is not surprising. They tower above traffic, can summit Everest, and are safe in a crash (good because sport utes have more than their share.) If theyre thirsty, so what? Gasoline costs are only 1/8th the total cost of driving. Driving a car that gets 30 miles per gallon rather than a 15-mpg sport ute saves about $520 a yearnot much in many budgets. Americans care little about fuel efficiency because gasoline is inexpensive. In Europe motorists pay $3 to $5 a gallon. Most is tax, added by governments to encourage conservation. A Suburban has a 40-gallon tank. Filling up in Finland would cost 200 bucks. Needless to say, Finns shun Suburbans. Bargain-rate gasoline has a hidden cost, but we dont pay it at the pump. Rather, we pay $50 billion in taxes to protect access to Persian Gulf oil, we pay in smog and premature deaths from air pollution, we pay in climate change. But when gasoline is less expensive than milk, Americans have little incentive to conserve. People arent dumb.
If gas is cheap, oil must be abundant. Big is best. If you have an Explorer Ill get an Expedition. Its a fuels paradise." Party hearty.
A LIGHT GOES ON. "In America we consume the most energy per capita in the world. Thats got to change." Who said it? Not Ralph Nader or Amory Lovins. Rather, it was Louis Hughes, a General Motors vice president for international operations. The oil companies and automakers are beginning to understand that we must move quickly to develop a more oil-efficient economy. Toyota is selling 66-mpg cars in Japan. Honda is poised to follow. From a global perspective, oil is not a "sunset industry"after all, 65% of the worlds petroleum remains to be produced. Nonetheless, oil companies are beginning to diversify. Royal Dutch Shell recently launched a renewable energy division and British Petroleum is making solar panels. The ultimate heresy: General Motors supports a 50 cent per gallon gasoline tax. In this case, whats good for GM would be good for America.
SILVER BULLETS. Oil depletion is a slow, wasting disease. Is there a quick fix, a miracle cure? Actually, there are exciting new developments. They include technology for converting natural gas to a diesel-like fuel; horizontal drilling and 3D imagery to recover more oil from aging fields; cars powered by fuel cells that run on hydrogen rather than gasoline; telecommuting and other social changes that reduce oil consumption. All can buy time, delay the peak, and soften the transition that must follow. None, though, can cure depletion, or greatly reduce Americas dependence on imported oil. Technology shows promise, but the negative trends remain more powerful. Every day the world uses 73 million barrels and finds 15 million. Consumption up, discoveries down. Burning more than we earna surefire recipe for bankruptcy.
STOCK TIPS. Forbes and Fortune recommended oil stocks in 1995. In 1997 energy service companies were the stars of Wall Street. But maybe there will be another stock-buying opportunity. The economic turmoil in the Pacific, the Asian flu, will dampen energy demand for a year or two. With the collision between rising demand and limited supplies still five to ten years away, its a good time to travel. Fly to Baja, take a cruise, see Costa Rica. Lifes a journey, enjoy the ride. Around 2005 you might want to unload your shares in Winnebago.
SILVER BULLETS II. The physics of a Pontiac (or pickup) are abysmal. According to Rocky Mountain Institute, just 1% of the energy in the gasoline moves the driver. About 15% moves his steel shell, the 2-ton carapace. The remainder is lost in the engine, drivetrain and to wind resistance. This is actually great news, because it suggests theres tremendous scope for improvement. Soon youll be able to buy a car that gets 65 miles per gallon. These clean, efficient "21st Century" cars may capture a third of the market by 2010. But adding 20 million fuel-frugal cars a year to a global fleet that may then number 800 million will have only a modest impact on oil consumption. Every little bit helps, but it will be decades before the world fleet is dramatically more efficient.
OIL IS ASPEN. Our ski economy is much more dependent on oil than snow. After all, we can make snow. At Buttermilk or Highlands or Ajax, oils importance is affirmed every few minutes as a loud jet accelerates down the runway. One in five Aspen skiers fly in from overseas. Economically, Aspen functions as a snowy suburb of New York, Chicago, and Los Angeles. How long can this continue? Decades perhaps, not forever.
DRIVING BLIND. Petroconsultants, a respected Geneva energy consulting group, recently concluded that by 2050 world oil consumption will be just one-fourth what it is today. Another oil expert, University of Colorado professor John D. Edwards, predicts that world oil production will peak in 2020 at 90 million barrels per day. "If the hundreds of billions of dollars needed to increase productive capacity to these levels are not available, peak production will occur earlier. Planning without anticipating this trend is analogous to driving without a gas gauge."
TREX. Most people abhor change. Change is scary. Mentally, we tend to be prisoners of the past, hoping that the future will be just like the present, only more so. Abundant oil is all weve known. Cheap gas is a given. But this quaint assumption may soon take a beating. The silver miners who settled Aspen in 1880 didnt drive Range Rovers. Its a safe bet that Aspenites in 2090 wont drive them either. If the average person has a car 50 or 100 years from now it will be dramatically more efficient and powered by hydrogen or electricity. The heyday of the guzzler is passing. The gargantuan 6,000-pound 14-mpg Expeditions that now rule the road are to the car as the T Rex was to the dinosaur: the end of the line.
PURE SPECULATION. Inexpensive oil is so deeply embedded in our economy, psychology, and even diet that its difficult to imagine a world in which oil will be more expensive. What would a sudden spike in oil prices mean for Aspen? Let me speculate, knowing Ill probably get it wrong. An oil crunch might, where nothing else has, rein in the valleys real estate boom. Some believe that the stratospheric prices in the upper valley are a speculative bubble waiting to burst. Our valleys economy has proved remarkably resilient to other shocks, but this one could shatter Wall Street. An Oil Crunch would also slow tourism. Because only 10% of an airplane ticket pays for fuel, the direct effects would be dwarfed by the larger inflationary impacts. Psychology will come into play, too, since inexpensive oil buttresses the belief that growth is inevitable, stocks go up, and things get better. But, come what may, higher gasoline prices are not the end of life as we know it. After a rocky year or two or three of global recession, people will adjust, life will go on. Most Europeans already pay $3 or more per gallon; Americans presumably could, too.
DEBATING THE TRAIN. Over the last 70 years the automobile grew dominant because oil was cheap. All across America trains gave way to cars. Neighborhoods surrendered to suburbs. In the words of the song, we "paved paradise and put up a parking lot." In Colorado, too, the transportation network we see today is an artifact of abundant oil, an era thats destined to end. With oil depletion in mind, the suggestion that we should remain auto dependent, construct underground garages, and six-lane Highway 82 seems like old think. Is our long-term vision driving cars fueled with gasoline on tires made of petroleum on roads paved with asphalt? Hell-o! To quote Marshall McLuhan, thats like "speeding into the future while trying to steer with a rear-view mirror." The train may or may not make economic sense. But as we debate whether valleywide rail is a wise investment, our focus should not be 2008, a short decade from now. Rather it should be 2018 or 2028, when world oil production will be falling, as global population continues to climb. As we study rail, lets not assume the status quo is sustainable, because its not. By 2025, driving alone 70 or 80 miles to work may be as obsolete as riding a horse to work is today.
HARD ROCK CAFÉ. Is there really no substitute on the petroleum menu? Our natural gas reserves wouldnt last long if we burned them in both homes and cars, but what about all that oil shale near Parachute? Oil lobbyists will tell you theres tons of "unconventional" oil tied up in Canadian tar sands, Venezuelan heavy oil, and Colorados oil shale. True enough, but thats like saying hang gliders can substitute for airplanes. Producing unconventional oil has more in common with hard-rock mining than with typical oil production, where you crank a valve and let if flow. The former is a slow, arduous, energy-intensive process that will never replace a tenth of todays conventional oil. Indeed, theres some question whether oil shale yields more energy than it takes to produce it. If conventional oil is black magic, oil shale is fools gold.
FLOW, RIVER, FLOW. Every 24 hours the global economy burns 73 million barrels of oil. If you poured all that oil into a river it would be the size of the Colorado as it flows through Glenwood Springs. That modest river propels all motorized motion on the planet. Every car in Carbondale, China, and Chile. Every Boeing, every Airbus. Semis, autos, trucks, bulldozers, B-1 bombers, motorcycles, supertankers, tugboats, tractors, lawn mowers, snowmobiles, jet skis, snowblowers if it moves its powered by oil. Looking ahead, oil demand is projected to increase rapidly. By 2010 most experts predict the world will be consuming 90 million barrels a day, 25% more than it does now. Sometimes between 2005 and 2020, world oil production will reach an apex, an all-time high, a peak. A plateau in production will be followed by a relentless inexorable decline.
DOOMERS & BOOMERS. World oil experts fall into two camps, pessimists and optimists. Its striking how little difference there is between them. Both camps agree weve already used 800 billion barrels. The pessimists, or doomers, think theres one trillion left and that oil production may peak by 2005. Boomers believe theres 1.8 trillion left and that production will peak in 2020. If fifteen years is the only difference between pessimists and optimists, perhaps we ought to begin planning for a world in which oil is not as abundant as it is today.
LIFE IN 2050. By 2050 a world of perhaps 9 billion people will be consuming only as much oil as 3 billion did in 1950. There will be three times less oil per person. Oil will be more expensive. Is this a Doomsday message? Not necessarily. A more sustainable world may actually be a better place in which to live. The difficulty is getting from here to there.
WHY HAVENT I HEARD THIS BEFORE? Who would tell you? Exxon? Ford? Bill Clinton? "Remember my Bridge to the 21st Century? Well, theres a big pothole on the far side. Im sending Al over there right now to patch it up. When you hit that rough spot, remember Hillary feels your pain." Should Ronald Reagan have told us? "My fellow Americans, it is not morning in America. Actually, its getting on towards sundown." The Oil & Gas Journal publishes articles on oil depletion, but the coming crisis is not yet on the mainstream medias radar. Its astounding that, in a country like ours, which uses 25% of the worlds oil, no one is responsible for setting oil policy. The oil majors produce oil. Carmakers make cars. The Pentagon spends $50 billion a year safeguarding our "cheap" Persian Gulf imports. The U.S. Department of Energy cleans up nuclear bomb plants. If ignorance is bliss, this must be Nirvana.
SOURCES & INFO. This petroleum primer was written by Randy Udall, Director of the Community Office for Resource Efficiency, with Steve Andrews, a Denver-based energy analyst. Our numbers and graphs were derived from U.S. Geological Survey, British Petroleum, and American Petroleum Institute reports. Oil consumption to 1996 is historical record. Depletion curves and future consumption were extrapolated from conservative assumptions and personal interviews with world oil experts, including Chuck Masters, Neil Foreman, L.F. Buzz Ivanhoe, Colin Campbell, Joseph Riva, and James MacKenzie. Different scenarios can be imagined, some uglier, some prettier. No one can predict the future. But, on the strength of our research, America can expect a wake-up call before 2020. It could come tomorrow. Even 2020 is only 8,000 days away, which, given the stakes, isnt far. If you want more info call CORE. Good books: The Coming Oil Crisis by Colin Campbell and GeoDestinies by Walter Youngquist. CORE has the former ($25); to order the latter call (800) 827 2499. The Prize, Daniel Yergins classic oil history, is available in text or video at local libraries. Good Internet sites: http://ecotopia.com and http://energy.er.usgs.gov/products/papers/world_oil/index.htm. CORE will host a half-day seminar on world oil this spring . If you wish to attend, call for details.
The Big Question Site of the Week at Seven Wonders: Is there an oil crisis? When will the Joy Ride End? [February 14, 2001]