Brave nightmare world - The End of Oil

"...and the costs when the oil runs out and the world is forced to confront both its energy needs and its abysmal lack of preparation for a successor to petroleum are going to staggeringly high."


BOOK REVIEW

Brave nightmare world

The End of Oil: On the Edge of a Perilous New World by Paul Roberts

Reviewed by David Isenberg
Jan 15, 2005
Source

In retrospect, one of the funniest lines about the US invasion of Iraq will be the one uttered by the war's defenders who managed to insist with a straight face that this wasn't a war for oil.

Oil is the lifeblood of the world economy. It is so deeply entrenched in our societies that it is an existential fact of life. And any country that happens to have a substantial share of the world's proven reserves will always be, to use a military term, a center of gravity.

But as the very lucidly written The End of Oil makes clear, the day of reckoning for the oil industry is in sight, at least for some of us, and the costs when the oil runs out and the world is forced to confront both its energy needs and its abysmal lack of preparation for a successor to petroleum are going to staggeringly high.

One doesn't have to look far for signs of this. Consider that the US National Commission on Energy Policy, a bipartisan group of top energy experts, recently released a strategy, more than two years in the making, to address major long-term US energy challenges. The report, "Ending the Energy Stalemate: A Bipartisan Strategy to Meet America's Energy Challenges", contains detailed policy recommendations for addressing oil security, climate change, natural-gas supply, the future of nuclear energy, and other long-term challenges.

Also, members of the Organization of Petroleum Exporting Countries (OPEC) meeting in Buenos Aires in mid-December appeared to be more concerned about the impact on their economies of measures to reduce greenhouse-gas emissions than about the potentially disastrous consequences of global warming, which are largely attributable to the burning of fossil fuels.

If the past is truly the prologue to the future, then author Paul Roberts, a longtime contributor to Harper's magazine, has served us well. For in large part, his book is a history of not only oil but of humanity's quest for energy. As he notes, for most of the past 6,000 years, human history has been characterized by a constant struggle to harness ever-larger quantities of energy in ever more useful ways. The wide-scale use of coal in England set the conditions for the Industrial Revolution. A century later, oil and natural gas completed the transformation, dragging the industrializing world into modernity and in the process, fundamentally and irrevocably reordering life at every level.

In short, energy is the Holy Grail. As Roberts writes:

Energy has become the currency of political and economic power, the determinant of the hierarchy of nations, a new marker, even, for success and material advancement. Access to energy has thus emerged as the overriding imperative of the 21st century. It is a guiding geopolitical principle for all governments, and a largely unchallenged heuristic for a global energy industry whose success is based entirely on its ability to find, produce, and distribute ever-larger volumes of coal, oil, and natural gas, and their most common by-product, electricity. Yet even a cursory look reveals that, for all its great successes, our energy economy is fatally flawed, in nearly every respect. The oil industry is among the least stable of all business sectors, tremendously vulnerable to destructive price swings and utterly dependent on corrupt, despotic "petrostates" with uncertain futures.

That, however, does not begin to cover the downside. Other factors must include climate change due to the greenhouse effect; the finite quantities of petroleum remaining; the challenges of finding, producing and distributing it; its use in generating electricity - the fastest-growing segment of the energy market - and its overwhelming demand on the existing infrastructure; the breakdown of the energy system in the developing world, where the urgent quest for survival doesn't allow for environmental considerations; and the future energy demands of countries such as China or India, to name just a few of the issues Roberts covers.

Roberts' reporting is both wide-ranging and insightful. In detailing the global oil addiction, his travels take him from Saudi Arabian oilfields to Azerbaijani pipelines to natural-gas terminals in Mexico to a Vancouver power company to wars between competing gas-station chains in China.

But he never strays far from his central point: that the energy economy is changing, and not always for the better. We no longer have a choice in the matter. To use a favored expression from those who talk about the probabilities of another September 11, it is not a question of if, it's a question of when.

Make no mistake, change is coming. And if history is any guide at all, it will be traumatic. That is assuming that the countries of the world actually try to cooperate with one another on issues such as energy conservation or adopting new energy technologies, ie natural gas, hydrogen, solar and wind. It also assumes willingness on the part of the existing multinational energy companies to move forward on these technologies instead of trying to wring every last cent out of their existing capital stock. That is not something the current US administration is likely to encourage given its existing ideology.

One of the more interesting issues that Roberts covers deals with the "peak oil" theory; in essence, the point when we hit the halfway mark in using the entire world's oil supply. While scientists and free-market ideologues argue over reserves and undiscoverable and recoverable oil, one estimate has us hitting the peak in just 25 years, around 2030.

Of course, that figure could be off, but other facts are indisputable - such as the fact that the majority share of the world's oil is in the Middle East, is controlled by OPEC, which already exerts inordinate influence over world oil prices, and will gain more as non-Middle East sources run out. And they are running out fast. Even taking into account optimistic projections, such as increased Russian oil production, non-OPEC oil production will peak in 2015.

However, the book is not entirely gloom and doom. There are things that can be done. But because of the central role of the United States as an oil consumer and key market for the rest of the world, its active participation is required on issues like the increased availability of natural gas, adoption of a carbon penalty, and an all-out effort to cut consumption of oil and other energy. Boosting automobile fuel-efficiency standards would be an example. How likely is this? Considering the last time the United States got serious about that was after the 1974 oil shocks, not very.


The End of Oil: On the Edge of a Perilous New World by Paul Roberts, 2004, Houghton Mifflin. ISBN: 0747570752, 332 pages. US$33.

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