By Louis Arnoux: Twilight of the Oil Age: Out of Gas by 2030

The easy oil is gone. The oil that remains is hard and getting exponentially harder to find and extract, and to make a profit doing so. Each year it takes more energy to produce the same amount of energy meaning each year there is less energy left over for society. This is why people who think we have an energy glut are wrong.

Think of a coyote forced, because rabbits are becoming faster, to burn 2 rabbits worth of energy to catch 1 rabbit. Even though there are plenty of rabbits, the coyote is in serious trouble. The coyote could switch his diet to mice (solar & wind energy) but then he’d have to burn 3 mice of energy to catch 1 mouse. The coyote is able to lead a fairly normal life for a while because he burns fat (debt) that he built up in previous good years. The coyote knows it could make do with less food if it quit fighting, played slower games, and had fewer pups, but prefers not to change its lifestyle. Over time, the coyote becomes weak and sick, and then decides to change, but he no longer has the strength to catch any food.

This analysis by Louis Arnoux predicts we have between 6 and 13 years before society is out of gas.

This means that some time between 2022 and 2030, your gas stations and airports will be closed, and the global economy will be on its way to a complete collapse.

I’ve been following this issue for years and I think his prediction is in the ballpark.

I should point out that this oil centric perspective does not consider the current debt/growth instabilities of the economy. People studying that piece predict an economic collapse sooner than 2022. Nor a climate change centric view which suggests we have at best until the end of this century.

Let that sink in for a moment and then you might begin to understand why I am so fascinated by our inherited denial of reality. This information is available for anyone that cares to look, including the news media. No one looks.

Arnoux concludes the interview by pitching an alternate energy product idea he is trying to raise funds to develop. No information is disclosed on the technology but I did some searching to get the gist of it. It’s an interesting idea but has 0% chance of heading off the problem his research on oil depletion predicts.

His behavior is consistent with other researchers working on collapse related topics. For example, almost every climate scientist has a favorite scheme they think will save us whether it’s BECCS, or geoengineering, or nuclear energy. Most people would be unable to function in these roles unless they had some hope for the future. That’s our inherited optimism bias, the inverse twin of denial, at work.

Here is an audio interview with the author.

Here is the paper behind the interview:
Part 1
Part 2
Part 3

Hat tip to Alice Friedemann.

You know you are in trouble when…

Examples of denial are both profound and unacknowledged.

The short-term solution to our problems is the long-term cause of our problems: economic growth

The long-term solution to our problems is the short-term cause of our problems: reduced consumption

All political parties in all countries and almost all citizens, including the few citizens that understand our predicament, reject our best course of action: austerity

Most citizens have no idea how fortunate they are to be alive at this point in history: A Guide to Being Human in the 21st Century

The only problems society does not acknowledge, or discuss, or act on, are the only problems that matter: species extinction, limits to growth, debt, peak oil, overshoot, resource depletion, climate change, sea level rise, fisheries collapse & ocean acidification, nitrogen imbalance & tree decline 

There is evidence that feedback loops are taking over and causing some problems to go exponential: climate change, CO2 emissions, ice loss, sea level rise, debt

The previous year’s worst case predictions are tending to become this year’s most likely prediction: sea level rise

Actions that improve the long-term worsen the short-term: air pollution masks 0.5C of warming, austerity and debt reduction, renewable energy, population reduction 

The only possible permanent solution is rejected by the belief systems of 90+% of citizens: population reduction

The only possible permanent solution is too slow to avoid the worst problems: population reduction laws

Countries fortunate to have a low birth rate often cancel their good fortune with immigration: Canada

Citizens have wildly different beliefs about our predicament: there is no problem; there is a problem but it’s not caused by humans; I don’t want to think about it; technology will save us; it’s in the hands of God; I’ve already done enough; someone else needs to do something first; my actions won’t make a difference; someone else will consume whatever I give up; it’s too late to do anything

Despite wildly different beliefs about our predicament, there is one thing that almost everyone agrees on: I don’t want to change my behavior

The few people who understand the severity of our problems do not set good examples in their personal lives: leaders, climate scientists, environmentalists

The quality of our leaders is declining because those people with high intelligence, wisdom, and integrity do not want to be in charge of our predicament, and because citizens are feeling the impact of overshoot, do not understand what is going on, and are angry: Trump and Clinton

The leader of the free world denies science and issues daily, jaw-dropping, cringe-inducing tweets: Trump

The one world leader that did understand the problem and spoke out was rejected by the citizens and no longer speaks out: Jimmy Carter

We do not acknowledge that the world’s economic problems began with the peaking of a key non-renewable resource: conventional oil

Low energy prices have led citizens to believe we have a glut of fossil energy when in fact: all types of energy have peaked

Citizens believe the exact opposite of reality: technology creates wealth and energy rather than energy creates wealth and technology

Every country has similar economic problems and not one leader anywhere in the world connects the dots and publicly acknowledges the root cause, even after they leave office: energy extraction cost + debt

We do not discuss or act on economic history research that shows countries always get into serious trouble when they permit an important ratio to exceed a threshold we long passed: debt to GDP

Bankers, the creators of money, do not understand the one thing that creators of money should understand: thermodynamics of wealth

The professionals with the most influence on public policy use models that violate the most trusted laws of physics: economists

The scientific theory that explains the relationship between the economy, energy, and climate is ignored by everyone that should understand it: Tim Garrett

The people who deserve the most respect and admiration get the least: scientists

The people who deserve the least respect and admiration get the most: celebrities

All types of non-fossil energy do not provide a substitute for the only energy we can’t live without: diesel for trucks, trains, ships, tractors, and combines, and mining machines; plus natural gas for fertilizer

People who think the shale revolution will make America prosperous and energy independent ignore one thing: facts

Intelligent people who understand the climate change threat, like James Hansen and Bill Gates, and who want business as usual to continue, know that nuclear energy is the only option: peak uranium

If climate deniers continue to win elections and try to maintain the existing electric grid they’ll find that strategy may not work for long: peak coal

Citizens most vulnerable to a fragile global supply chain with only a few days of inventory experience the strongest illusion of abundance and security: inhabitants of rich cities

Most citizens are not even vaguely aware of the invention that enabled their existence and created about 50% of the nitrogen in their bodies: Haber-Bosch conversion of natural gas to fertilizer

Well meaning environmentalists demand that we stop subsidizing fossil energy companies without understanding the source of all that they cherish in modern civilization: fossil energy

Well meaning environmentalists demand that we stop subsidizing fossil energy companies without realizing that many fossil energy companies are going bankrupt: ExxonMobil

A solution frequently advocated makes things worse by accelerating growth and decreasing system resilience: efficiency

The best solution for removing CO2 from the atmosphere is being harmed by the same activity that creates CO2: planting more trees which are then injured or killed by ground level ozone

All climate science models that do not predict disaster now depend on an unproven technology that we probably can’t afford and other species definitely can’t afford: BECCS (bio-energy with carbon capture and storage)

We have not acted to prevent a predictable and very dangerous side effect of trying to maintain business-as-usual with low interest rates: increasing wealth gap

We still enjoy historically vast surplus wealth that could be deployed to improve our future lives but we are squandering it: military, airports, highways, new cars, high rises, etc.

Earth with its diverse complex life and a highly intelligent species is extraordinarily rare, precious, and worth fighting to protect, yet we dream of other barren homes: colonizing Mars

The tool that could be used to unite citizens in common purpose and useful action is instead being used to create tribes that reinforce preexisting beliefs: internet

Many people are hurting and lashing out in anger because they do not understand the cause of their pain: Brexit, Trump, Syria, Venezuela, etc.

The few sources of information that understand and communicate the truth are under threat: fake news

Few people study or heed the best predictor of the future: history

None of our schools teach skills useful and relevant to our future: growing food and other forms of lower complexity life skills

The thing that enabled the evolution of our high intelligence and its ability to understand and act on problems is the same thing that causes our problems and prevents us from acting on them: denial of reality

The theory that best explains our existence and our self-destructive behavior is ignored by everyone, including those people seeking to understand our problems: Varki and Brower’s denial of reality theory

Readers are encouraged to submit additions to the list.

By Nafeez Ahmed: Brace for the Financial Crash of 2018

Good news!

Someone thinks we have another year.

And if this prediction comes true, CO2 emissions will fall.

https://medium.com/insurge-intelligence/brace-for-the-financial-crash-of-2018-b2f81f85686b#.1qn4wrwxa

80% of the world’s oil has already peaked, and the resulting oil crunch will flatten the economy.

A report by HSBC shows that contrary to industry mythology, even amidst the glut of unconventional oil and gas, the vast bulk of the world’s oil production has already peaked and is now in decline; while European government scientists show that the value of energy produced by oil has declined by half within just the first 15 years of the 21st century.

“In order to avoid the [oil] price affordable by the global economy falling below the extraction cost, debt piling (borrowing from the future) becomes a necessity, yet it is a mere trick to gain some time while hoping for something positive to happen,” said Meneguzzo. “The reality is that debt, basically as a substitute for oil, does not work to produce real wealth, as apparent for example from the decline of the industry value added as a percentage of GDP.”

Today, we are all supposed to quietly believe that the economy is in ‘recovery’, when in fact it is merely transitioning through a fundamental global systemic phase-shift in which the unsustainability of prevailing industrial structures are being increasingly laid bare.

By James Howard Kunstler: Forecast 2017: The Wheels Finally Come Off

Here is Kunstler’s year-end summary and predictions for 2017.

Kunstler does an amazing job of weaving many complex threads into an interesting, coherent, and (I believe) true story.

Long time students of overshoot won’t find any new ideas here but it’s an excellent refresher for experts, and a great place to start for newbies.

This year’s predictions are specific and very short-term so we won’t have long to wait to see if he’s right. If he is wrong, it will likely be in timing rather than outcomes.

Highly recommended.

http://kunstler.com/clusterfuck-nation/forecast-2017-wheels-finally-come-off/

“There is no other endeavor in which men and women of enormous intellectual power have shown total disregard for higher-order reasoning than monetary policy.” — David Collum

By Chris Martenson: As We Enter 2017, Keep the Big Picture in Mind

An excellent year-end piece by Chris Martenson.

https://www.peakprosperity.com/blog/105291/we-enter-2017-keep-big-picture-mind

 

Truthfully, there’s a lot about which we should all be concerned, and I think that people’s sense of unease heading into 2017 is well-deserved, if sometimes misplaced.

What do I mean by that?  Well, it is misplaced to be worried about symptoms instead of causes.  The fever is worrying but it is not the cause of the illness.

 

Perhaps the most vexing challenge remains how to more effectively communicate the various predicaments and problems we face.

It’s not having more numbers, or more data, that’s for sure.  If numbers and data ‘worked then we’d have taken a very different path sometime back in the 1950’s.

 

As Admiral Hyman Rickover said in a speech to a group of doctors in 1957:

“I think no further elaboration is needed to demonstrate the significance of energy resources for our own future. Our civilization rests upon a technological base which requires enormous quantities of fossil fuels. What assurance do we then have that our energy needs will continue to be supplied by fossil fuels: The answer is – in the long run – none.

The earth is finite. Fossil fuels are not renewable. In this respect our energy base differs from that of all earlier civilizations. They could have maintained their energy supply by careful cultivation. We cannot.

Fuel that has been burned is gone forever. Fuel is even more evanescent than metals. Metals, too, are non-renewable resources threatened with ultimate extinction, but something can be salvaged from scrap. Fuel leaves no scrap and there is nothing man can do to rebuild exhausted fossil fuel reserves. They were created by solar energy 500 million years ago and took eons to grow to their present volume.

In the face of the basic fact that fossil fuel reserves are finite, the exact length of time these reserves will last is important in only one respect: the longer they last, the more time do we have, to invent ways of living off renewable or substitute energy sources and to adjust our economy to the vast changes which we can expect from such a shift. Fossil fuels resemble capital in the bank.

A prudent and responsible parent will use his capital sparingly in order to pass on to his children as much as possible of his inheritance. A selfish and irresponsible parent will squander it in riotous living and care not one whit how his offspring will fare.”

(Source)

His logic was as irrefutably sound then as it is today.  Such information was known at the highest levels throughout government and academia.  But there was no, and continues to be no, sustained and well-funded efforts to grapple with the basic dilemma posed by increasing population as dramatically as we have all the while living on, literally eating, fossil fuels to encourage that rapid population growth.

“Can you think of any problem in any area of human endeavor on any scale, from microscopic to global, whose long-term solution is in any demonstrable way aided, assisted, or advanced by further increases in population, locally, nationally, or globally?”  ~ Al Bartlett

 

The predicament we face is really quite profound.  I submit to you that people know this in their guts and the fact that they do goes a long way towards describing the feeling dread many people report they are carrying here at the start of 2017 and cannot seem to shake.

And of course they are.  Not having a plan for how to even feed 7.4 billion people, heading to 9 or 10 billion people, without massive fossil fuel calorie subsidies is a troubling thought.  If it’s not troubling, then more thinking needs to be applied.

By Gail Tverberg: EROEI Calculations for Solar PV Are Misleading

Gail Tverberg has convinced me to stop using EROEI as a measure of the usefulness of alternate energies.

For me now the critical tests are: Does it pay more taxes than the subsidies it receives, and does it make a (small is ok) profit assuming a “normal” interest rate of at least 5%?

If yes, the energy is helpful. If no, the energy is not helpful.

I watch for alternate energy installations anywhere in the world that meet these criteria and have not found one yet.

Gail is this paper explains why EROEI is not a useful measure…

https://ourfiniteworld.com/2016/12/21/eroei-calculations-for-solar-pv-are-misleading

By Steve St. Angelo: End of the U.S. Major Oil Industry Era: Big Trouble at ExxonMobil

https://srsroccoreport.com/end-of-the-u-s-major-oil-industry-era-big-trouble-at-exxonmobil/

The era of the mighty U.S. major oil industry is coming to an end as the country’s largest petroleum company is in big trouble.  While ExxonMobil has been the most profitable U.S. oil company in the past, it suffered its worst year on record.

ExxonMobil’s free cash flow declined from $24.4 billion in 2011 to $1 billion for the first nine months of 2016. The reason for the rapidly falling free cash flow is due to skyrocketing capital expenditures and falling oil prices.  But, this is only part of the picture.

… in 1997, Exxon spent $11.8 billion on capital expenditures while producing 2.5 million barrels per day (mbd) of oil.  However, their capital expenditures nearly tripled to $34 billion in 2012 as total liquid production fell to 2.2 mbd.  Basically, Exxon spent three times more money in 2012 to produce 300,000 barrels per day less than it did in 1997.

It seems as if Exxon realized early on that peak oil had finally arrived (privately, of course), so it decided to not waste too much money on future oil projects.  Instead, the company spent a massive amount of money on stock repurchases over the past two decades… especially since 2005.

The lion’s share of their stock buybacks were between 2005 and 2014.  In that ten-year period, Exxon purchased a staggering $220 billion of its own shares.  Now compare that to the company’s total capex spending of $245 billion during the same time period.

As we can see, Exxon’s long-term debt has exploded from $6.9 billion in 2013 to $29.5 billion in the first half of 2016.  Basically, the company is now borrowing money to repurchase shares or pay dividends.

Exxon Mobil Corp. (recently) warned that it may be forced to eliminate almost 20% of its future oil and gas prospects, yielding to the sharp decline in global energy prices.

The 100+ year era of the U.S. major oil industry is coming to an end… and fast.  Unfortunately, Americans have no clue just how dire the situation has become as many probably still believe in the delusion of “U.S. Energy Independence.”

I would imagine by 2020, the U.S. will be a much different place.  Regrettably, most Americans are not prepared.