Friday, September 3, 2010

The Peak Of The Oil Wars - 2

A while back Dredd Blog had a post The Peak of The Oil Wars which indicated, among other things, that some professionals think that Iraq will be the number one oil producer in a short while.

Recently the German government has completed a study concerning the issue of "peak oil", which was leaked to the internet.

The study contains statements that resemble what peak oil scientists have been saying for decades, while being castigated as "doomers" for so saying.

The reality of peak oil, combined with global warming and global climate change, is a clear and present danger, a sure threat to the continuation of civilization as we know it:
Relapse into planned economy: Since virtually all economic sectors rely heavily on oil, peak oil could lead to a "partial or complete failure of markets," says the study. "A conceivable alternative would be government rationing and the allocation of important goods or the setting of production schedules and other short-term coercive measures to replace market-based mechanisms in times of crisis."

Global chain reaction: "A restructuring of oil supplies will not be equally possible in all regions before the onset of peak oil," says the study. "It is likely that a large number of states will not be in a position to make the necessary investments in time," or with "sufficient magnitude." If there were economic crashes in some regions of the world, Germany could be affected. Germany would not escape the crises of other countries, because it's so tightly integrated into the global economy.

Crisis of political legitimacy: The Bundeswehr study also raises fears for the survival of democracy itself. Parts of the population could perceive the upheaval triggered by peak oil "as a general systemic crisis." This would create "room for ideological and extremist alternatives to existing forms of government." Fragmentation of the affected population is likely and could "in extreme cases lead to open conflict."
(Der Speigel, emphasis added). As oil becomes more scarce the national security of various nations will become more and more threatened.

Like addicts fighting for a fix of heroin, nations will drift closer and closer to war as desperation sets in.

In the face of such catastrophe, our Senate could not even pass legislation that would increase the fuel mileage of automobiles, rushing headlong toward oblivion instead.

After all, we have now entered into the age of criminal insanity, a time when more and more insane people get elected into government.

Whether you follow George Oilwell or George Orwell, things are getting curiouser and curiouser are they not?

The next post in this series is here, the previous post in this series is here.


  1. Hey, Dredd. Gee, the German government has little faith in free markets and human ingenuity.

    It didn't have the catchy name at the time, but the notion of "peak oil" first surfaced, in my experience, in the 1970s.

    The concept is undeniable, we have to run out of oil eventually... But problems with oil seem always to be associated with problems in the economy. And it is not clear to me that oil causes the economic problems. Oil may simply be in the catbird seat: At the first hint of economic problems, oil prices skyrocket because they can and that just makes the economic problems worse.

    Maybe this scenario is not right. But I am not comfortable with the assumption that oil is the underlying cause. The economy is in bad shape, even when oil is behaving itself.

    Your remarks brought to mind the old Robert Redford movie Three Days of the Condor


  2. Art,

    "Gee, the German government has little faith in free markets and human ingenuity."

    Irrelevant to the issue of peak oil, and also an absurd notion. The US took their rocket scientists like von Braun captive @WWII to come here and build what we could not. They have ingenuity. They were the top exporter in the world until recently when China took over first place. They export engineering creations primarily.

    "the notion of "peak oil" first surfaced, in my experience, in the 1970s"

    It is not a "notion" and your numbers are off two decades at least. Hubbert advanced the hypotheses in the 50's when he predicted US peak oil would happen circa 1970. When it happened it gave his hypothesis theoretical strength. He is to peak oil what Einstein (a German) is to relativity.

    Scientists overwhelmingly cite oil usage as the prime contributing factor to global warming / global climate change.

    The eventual effects of using that material instead of clean renewable energy will have the most profound effects on economy that civilization has ever seen.

  3. I notice that this post links to an earlier post that quotes a report by Lloyds of London and The Chatham House which came to the same conclusion that the German report did.

    I think Lloyds of London has been known to insure ventures of ingenuity when other insurance companies would not.

    The German report is quoted on the Peak Oil Blog as well.

  4. Randy,

    A blog orchestrated by oilfield experts (The Oil Drum), also considers the German report to be worthy of note.

    They even translated some of the report into English.

  5. in 1873, we got the first 'oil crisis' when OPEC almost tripled our cheap-then prices. i was 19 at the time and wrote a school paper on it with a simple solution: a 10¢ a gallon tax and $500-1000 tax on all new vehicles... for intensive funding of alternative energy and transit. this was of course ridiculed as 'taking too long and we have to stick with the tried and true.' and here we are 37 years later with the same idiots voices saying the same old things...

    1. "The Organization of the Petroleum Exporting Countries (OPEC, /ˈoʊpɛk/ OH-pek, or OPEP in several other languages) is an intergovernmental organization of 15 nations, founded in 1960 in Baghdad by the first five members (Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela), and headquartered since 1965 in Vienna, Austria." (Wikipedia)

  6. Wow, taz, how old are you now? 156??

    No matter. I agree absolutely that the use of appropriate taxation is a most effective way to accomplish policy objectives.


  7. Gentlemen,

    The only sure thing in this "life" is taxation and death, according to das kapitalists.

    Either one of them brings the other, and both are leaches upon the greater good.

    When we call wisdom, common sense, and vision "taxes" we go the way of the extortionist governments, those who die an improvident death, after "living" an unfortunate "life".

    Need I list the empires of old or the current empire fast growing "old" to illustrate that point?

    Taxes are a necessary evil because they end up being our gift to those in need, as it must be, but they are not a substitute for wisdom, vision, or integrity.

    The military always have the greatest need, the needs of the poor are wee by comparison.

    ALAS! you are so sadly wrong my friends, because you would wee the people.