By Alice Friedemann: German Military Study on Peak Oil

German Military - Peak Oil Study - 2010

Alice Friedemann summarizes here a 2010 study on peak oil conducted by the German military.

http://energyskeptic.com/2017/german-military-peak-oil-summary/

The original full report can be found here.

And what was the German government’s response to this excellent report on peak oil by their own military?

They increased their population with immigration.

Denial is amazing!

 

Today approximately 90% of all industrially manufactured products depend on the availability of oil. Oil is not only the source material for producing fuels and lubricants but is also used as hydrocarbon for most plastic. It is one of the most important raw materials in the production of many different products such as pharmaceuticals, dyes and textiles. As the source material for various types of fuels, oil is a basic prerequisite for the transportation of large quantities of goods over long distances. Alongside information technology, container ships, trucks and aircraft form the backbone of globalization. Oil-based mobility also significantly influences our lifestyle, both regionally and locally. For example, living in suburbs several miles from their workplace would be impossible for many people without a car.

 

Societal risks of peak oil

  1. Economic collapse
  2. Transportation restricted
  3. Erosion of confidence in state institutions

There are not sufficient alternatives to oil for transportation, so when oil grows short, there are likely to be extreme restrictions for private vehicles, especially in suburbs, resulting in a “mobility crisis” that would make the economic crisis much worse.

Scarce or expensive oil would drive up the cost of all goods. Our current international movement of goods has largely been made possible by the technological progress in the field of freight traffic (container ships, trucks, cooling systems), which are based on fossil fuels.  So trying to switch all modes of transport to alternative energy sources is much more complex with today’s common means of transportation and technology. Mobility on the basis of fossil fuels is likely to remain a long time.   Oil shortages could lead to bottlenecks in delivering food and other life-sustaining essential goods.

After peak oil, there would be significant differences from past food shortages:

  • The crisis would concern all food traded over long distances, not just single regions or products. Regions that are structurally already at risk today would however be particularly affected (see figure 6).
  • Crop yields also depend on oil. Lack of machines or oil-based fertilizers and other chemicals to increase crop yield would therefore have a negative effect on crop production
  • The increase in food prices would be long-term
  • Competition between the use of farmland for food production and for producing biofuels could worsen food shortages and crises.

 

After oil shortages people will experience a lowering of living standards due to an increase in unemployment and the cost of oil for their vehicles. Studies reveal that only continuous improvement of individual living conditions provide the basis for tolerant and open societies. Setbacks in economic growth can lead to an increase in the number of votes for extremist and nationalistic parties.

 

Other likely consequences

Banks left with no commercial basis. Banks would not be able to pay interest on deposits as they would not be able to find creditworthy companies, institutions or individuals. As a result, they would lose the basis for their business.

Loss of confidence in currencies. Belief in the value-preserving function of money would dwindle. This would initially result in hyperinflation and black markets, followed by a barter economy at the local level.

Collapse of value chains. The division of labor and its processes are based on the possibility of trade in intermediate products. It would be extremely difficult to conclude the necessary transactions lacking a monetary system.

Collapse of unpegged currency systems. If currencies lose their value in their country of origin, they can no longer be exchanged for foreign currencies. International value-added chains would collapse as well.

Mass unemployment. Modern societies are organized on a division-of-labor basis and have become increasingly differentiated in the course of their histories. Many professions are solely concerned with managing this high level of complexity and no longer have anything to do with the immediate production of consumer goods. The reduction in the complexity of economies that is implied here would result in a dramatic increase in unemployment in all modern societies.

National bankruptcies. In the situation described, state revenues would evaporate. (New) debt options would be very limited, and the next step would be national bankruptcies.

Collapse of critical infrastructures. Neither material nor financial resources would suffice to maintain existing infrastructures. Infrastructure interdependencies, both internal and external with regard to other subsystems, would worsen the situation.

Famines. Ultimately, production and distribution of food in sufficient quantities would become challenging.

War.  Oil shortages are likely to be seen by importing nations as a national security issue leading to conflict, which could also emerge over renewable energy resources.

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