My daughter sent along a link to an article by Raymond Learsley at http://www.huffingtonpost.com/raymond-j-learsy/extra-extra-wsj-and-nytim_b_975406.html and asked me to comment on it. My reaction follows:
Deb,
The original proposition of "peak oil" began with a model of how the production rate of oil from a "typical" oil field varied over time. The oil field would produce more and more as more wells were drilled until it reached a point at which the rate of production began to fall for various geological reasons: dropping pressures, depleted formations, water intrusion, etc. The point in time at which the peak rate occurred was called Peak Oil. M. King Hubbert in 1956 proposed a mathematical model (the logistics model) to describe this behavior.
King and others proposed that the rate of production of a related group of oil fields would exhibit the same sort of behavior, and King showed that the Texas fields did indeed follow that pattern. Others showed that the North Sea fields and some of the MidEast fields followed the pattern. Still other said the oil production rate for all the world's oil fields would follow this pattern. This meant that at some time in the future, the rate of production for the entire globe would fall back to zero.
There were strong arguments that this would not occur because of the discovery of new fields and advances in technology would make up the difference. The view that the supply of oil could at some time in the future go down was discounted because a majority of those the oil patch felt that advances would happen faster than increases in the demand for oil.
In 1972 the book "Limits to Growth" was published. It described a model in which a rapidly growing population with a finite supply of resources showed that growth could not be sustained forever, and at some time in the 21st century society would collapse and the population would diminish to match the resources available. I actually worked with the World3 model during the early 70s when I was teaching System Simulation Techniques at UC Extension to see how the predictions came about.
Reaction to this book was very strong, and mainstream economics theory refused to accept that this possible course of history could matter. In 2002 a review of the original book with reality found that the results of the 1972 study were still on track. I believe that part of this has come from the recognition that Peak Oil is indeed a factor to be considered in the near future of our world.
Which brings us to today. The arguments about growth and peak oil are becoming louder and louder. And they are becoming more important and potentially earth-shaking.
Today the mainstream of economics is based upon Keynesian theory that has as one of its basic tenants the belief that growth can always happen. Holding up that belief is the belief that there is an infinite supply of resources. It is this theory that leads to the need to save the banks and provide stimuli to our economy. Those that argue against this plan also believe in the infinite supply of resources, and they say to let the market control everything, it will all work out.
Both are wrong. Resources are not infinite, and one of the first commodities that is showing this limitation is fossil fuel. There has indeed been a peak in the rate of production of oil, and that peak is reflected in the increased price for fuel. It will only get worse as there are more and more people in the world and more of them want to live like we do here in the USA. But to admit that peak oil exists means you must accept the fact that growth cannot continue for the whole world forever. That is why Learsley yells and screams and Yergin publishes his academic patter trying to convince everyone that everything is okay. The article referenced is pure, unadulterated propaganda, because if they do not beat down those who say there is a problem, someone may say something needs to be done about it, and the solutions are not nice.
Peak Oil ... YES, and that is only the beginning.
love, Dad
sam, the Prudent RVer
