Brian Abraham

The following is an article from Aviation International News June 2005. Should we start thinking of a change in career

A world without oil is a breeding ground for alarmists, some say, blithely confident that it can’t run out and “we’ll find more,” but if it ever does run out “we’ll have found something else by then.”

Others who have made a career of studying our ever growing appetite for oil, however, see a harsher reality, and a new book by energy expert Tom Mast falls into this camp. For a book whose subtitle reads, “A Simple Guide to the Oil Shortage,” what better title could there be than Over a Barrel, because that is exactly where the industrialized world finds itself now, about 100 years after oil’s potential for transportation, manufacturing, comfort and the general advancement of mankind emerged.

Mast’s book starts out by noting that the oil we take for granted was created over a period of 100 million years, and in little more than a century (one-millionth of that creation period), mankind has burned approximately half of all the recoverable oil on the planet. That stark message alone sets the tone for what follows, which centers on Mast’s assertion that currently designated alternative fuel sources are simply not ready to fill the large gap in the energy industry that will be created when oil is no longer readily available. Those last two words are crucial to the dilemma: the half of all the planet’s oil that has already been burned was also the most easily extracted oil on the planet. What’s left is going to be ever harder to bring to the surface and refine.

Mast’s book presents his case in calm, measured language whose simplicity makes for compelling reading. It has been popular for those of us in aviation to take some comfort in telling ourselves we are a special case, since there is no way we can shovel coal into our wing tanks, carry nuclear fuel aloft or make airplanes perform to people’s liking with fuel that does not pack the energy density (the punch per pound) of jet fuel.

Alternatives, we have been assuring ourselves, can be found for ground-bound, less weight-critical energy applications, leaving the hydrocarbons for trickier uses such as aviation. Well, don’t count on it. All users of oil feel equally special, whether they are making pharmaceuticals to cure what ails us or grease or plastics to put in our SUVs or nitrogen for fertilizers to help feed us, and the price is going to go up for all users.

Unfavorable Position
When presented with this line of thought, Mast told AIN, “Aviation is in a particularly unfavorable position because of the lack of alternatives,” but he conceded it is reasonable for us to hope that, if alternative energy sources are developed for ground-bound transportation, demand for oil should diminish enough to ensure the continued supply of jet fuel for aviation to burn.

Oil users consist of industrial/ commercial (which accounted for 33.4 percent and 17.9 percent, respectively, of U.S. energy consumption in 2002); transportation (27.2 percent); and residential (21.5 percent). A traditional yardstick for measuring the longevity of the world’s oil supply is the reserves-to-production (R/P) ratio, which divides the proven oil reserves in the ground by current annual oil production. According to British Petroleum, the world R/P ratio for 2003 was 41 years. That is, at the 2003 usage rate, the proven oil reserves would last 41 years. “The use of the R/P ratio has engendered a sense of complacency,” warns Mast, “prompting many to tell themselves, ‘We have over 40 years of oil available, and we always seem to find more.’”

However, continues Mast, a more realistic school of thought states that we should focus on the time when world oil production peaks and begins its decline, rather than emphasize the R/P ratio. He cites L. B. Magoon, a USGS geologist who has mapped world oil fields for three decades and asserts that “Are we running out of oil?” is the wrong question to pose. “He says that instead we should ask, ‘When is the big rollover?’ The big rollover is defined as the time when world oil production peaks and rolls over into a permanent decline. After the peak, as production declines and demand continues to increase, oil will become scarcer each year.”

The so-called Hubbert’s Peak calculation (originated by geologist M. King Hubbert five decades ago) applied this thinking to U.S. lower-48 domestic oil production in 1956 and predicted that oil production would peak between 1966 and 1972. The actual peak came in 1970, at 9.4 million barrels per day, validating Hubbert’s approach. By 2002 it had dropped to 4.8 million barrels per day, a decline of 49 percent in 32 years–despite the addition of Alaskan production
to the U.S.’s resources.
Hubbert later applied his approach to the world and estimated the planet’s oil production would peak between 1990 and 2000. Other scientists have since used updated information to refine his calculations, estimating that the peak year for oil production would occur as early as 2003 or as late as 2020. “Some of the estimates calculated are imminent,” says Mast, “and none of the others is more than 16 years in the future. Matt Simmons, oil industry expert and advisor, says, ‘Peaking of oil and gas will occur, if it has not already happened, and we will never know when the event has happened until we see it in our rearview mirrors.’”

Once we reach the year of peak production, notes Mast, world oil production will begin to decline. If we don’t learn to use oil at a reduced rate or find alternatives, the demand for oil will continue to increase each year. The International Energy Agency forecast for demand growth is 2.3 percent for this year.

“Given the fairly optimistic assumption of a supply or production decline rate of 0.5 percent per year and a demand increase rate of only 1.5 percent per year, well under the current rate,” cautions Mast, “just six years after the peak we will have an unfulfilled demand of over 10 million barrels per day. In 11 years, the shortfall will be over 25 percent of current demand. Recently, we have seen that the mere threat of being short one or two million barrels per day results in whopping price increases and world tensions.”

‘Permanently Parked’
In one of the book’s references to aviation, Mast concludes, “The predicted scarcity of oil will cause cars and planes to be permanently parked, unless we develop alternative fuels.

“The important concept to grasp is that scarce oil and all the attendant problems will occur not when all the oil is gone, but when production can no longer keep up with demand, and this will be soon. Whether the peak and the beginning of declining production occur in 2005, 2007 or 2020, we must realize we have been procrastinating on developing robust fuel alternatives to oil. We should have begun years ago.”

Americans continue to have the heaviest thirst for oil, constituting only 5 percent of the world’s population but consuming 25 percent of the oil produced in the world in 2000–twice the energy consumption per capita of people living in Japan or Europe and 10 times that of the average world citizen. “But developing nations, particularly China,” notes Mast, “are rapidly increasing their demand for oil. [Last year] China alone accounted for 40 percent of the rise in demand.”

Mast examines the pros and cons of alternative fuels, including hydrogen, battery power, natural gas, shale oil and oil sands, coal, nuclear, solar and wind, biomass and hydroelectric. None of these (other than coal, but the conversion process would be energy-intensive) holds any currently recognized promise as an alternative for aircraft, so the best we can hope is that, if developed and embraced, they could collectively alleviate demand for oil and leave more for such applications as aviation.

To inspire a sense of urgency about the need to provide alternatives, Mast devotes one section of Over a Barrel to “Life in a World Without Alternatives to Oil,” and it is grim reading. A summary:

• Inflation will be stimulated as oil prices increase to levels impossible to predict.

• Standards of living will deteriorate if oil becomes extremely scarce. Manufactured goods, air travel, automobile commuting and vacations will eventually cost much more. Economies will suffer because spending on oil-based products will reduce the amount of money left to spend on all other goods and services. We will have to change our habits drastically.

• The global competitiveness of countries that have been heavily dependent on cheap oil will be reduced. The American economy thrives on inexpensive fuel for transportation, distribution and manufacturing. Removal of this crutch will make competing with low-cost-labor countries like China and India more difficult; those countries will be able to manufacture goods cheaply using low-pay workers, and the American economy won’t be able to compensate using energy-intensive machines.

• The balance of trade will be adversely affected. The outflow of money from countries importing oil to those exporting it will be huge. For example, an increase of $60 per barrel over present prices for U.S. oil imports would mean an increase in cash payments to foreign countries of $249 billion per year, or an additional $846 per person. This would be added on to an already serious $600 billion current-account imbalance.

The Money
Of course, much of this money would flow to the Middle East, which dominates the world oil supply, with 63 percent of reserves. In the Financial Times, Martin Wolf asserted, “Unless trends change, 10 years from now the United States will have fiscal debt and external liabilities that are both over 100 percent of the GDP. It will have lost control over its economic fate.”

The central message in Mast’s book is that only a serious effort to develop and embrace alternatives to oil will change that trend. We have been warned.

cwatters

Google the "HUBBERT CURVE" or see..

"Peak Oil Presentation in the US Congress.."
http://www.energybulletin.net/4733.html

"... we can now pick a day to celebrate passing the top of the mathematically smooth Hubbert curve: Nov 24, 2005."
http://www.princeton.edu/hubbert/cur...nts-04-01.html

It might be worse then this... We may have "only" extracted about half the known oil on the planet. The problem is we extracted the easy half first.

Wycombe

I've heard talk (and the evidence is now starting to emerge) that there is more oil under the South Atlantic than there was in the Middle East.

Getting it out will present some challenges, but they will be overcome when the planet gets desperate enough, I'm sure.

As long as we don't have to fight any more wars for it

trainer too 2

Isn't dear George W his approach to look at LNG as an alternative... He simply forgets that LNG can mainly be found in more dangerous places then oil...

More wars ahead if GW gets his way!

Dr Dave

Wycombe

My understanding is that S. Atlantic reserves are currently thought to be about 7% of the global total. A huge amount yes, but a long way short of the Middle East. It is a very, very optimistic person who suggests that this area will rival the latter. Only time will tell...

Dr Dave

aintsaying

Do some research to what is under the south pole. you might be surprised.

Comanche

The world is on the brink of a second Great Depression that will make the first one look like a dress rehearsal. Many know there will soon be a crisis, including the USA, but no politician will come even near the issue. Bush and his administration have adopted the 'last man standing' strategy it seems. To illustrate, here is the top 5 of oil producing countries:

1) Saudi Arabia
2) Russia
3) Kuwait
4) Irak
5) Iran

Do I need to say more.....As a pilot, I am in the process of learning new skills. The most worrying thing is that 95% of world food production relies on petrochemicals. The world without them could only support at best two thirds of the population and at worst one third. No wonder websites are being started that are called for example http://dieoff.com

411A

Strange isn't it.

Those who imply massive crude oil shortages surely have an axe to grind.

Fact.
Texaco and Chevron conducted a massive exploratory drilling program in the Rhub al Khali (empty quarter) of Saudi Arabia on behalf of Aramco (in the 1970's) and found....over eight times the oil reserves vs the amount of crude already extracted in the al-Hassa basin, the site of the original Chevron discovery, in 1938.

Deeper yes, but readily available, with good revervior pressure.
Even more with gas injection, as already has been the case in the al-Hassa basin, since the early eighties.

For the 'environmentalists, it surely is....'don't confuse us with the facts, our mind is made up already'.

Dr Dave

411A

But the facts of oil discoveries are hard to deny:

1. Oil discoveries in terms of volume per year peaked in the 1960's and have declined pretty constantly since then, despite increased drinning, better technologies, better understanding of oil traps, and the opening of new areas (Russia for example).
2. An official US government report recently stated (US Office of Petroleum Reserves), "World oil reserves are being depleted three times as fast as they are being discovered. Oil is being produced from past discoveries, but the re­serves are not being fully replaced. Remaining oil reserves of individual oil companies must continue to shrink. The disparity between increasing production and declining discoveries can only have one outcome: a practical supply limit will be reached and future supply to meet conventional oil demand will not be available."

Sorry, but it is not just the green brigade who feel concerned about this.

Dr Dave

RMC

Did none of you lot ever see Flash Gordon (the original version) those space ships used to have cinders dropping out the back.

At least we have got plenty of coal beneath the UK.

The return to three crew flight decks will be more expensive though as we will have to employ Flight Engineers again (in a modified stoker role).

Dr Dave

RMC

Good point. The enrgy density of coal is 25-30 MJ/kg, whereas Jet A is 43.3 Mj/kg. So you need about 50% more coal.

Perhaps we now know why the A380 has two decks - top deck for the passengers and bottom as the coal bunker?

Dr Dave

Hunter58

Check all the airline business plans with a barrel of crude standing at 100USD and you will see who really stays in business...

Some analysts (of good reputation) predict that to be the long term price in the not so far future...

Max Angle

We are indeed heading for interesting times. There is some debate about whether we have reached the peak of oil production or not but it is certain that any big increase in output will be expensive to realise. So while world production peaks, levels out or maybe even starts to decline in the near to mid future years the world demand for oil is rising dramatically with countries like China in the grip of massive industrialisation. One thing is certain, the days of cheap oil are well and truly over, the only way the price is going is up.

Skase Jnr

There are as many counter claims and theories against peak oil as there are for it. After a rainy weekend of reading 200 pages on the net, this is a good start,

http://educate-yourself.org/cn/davemcgowan70newsletter12oct04.shtml

or

the main site http://educate-yourself.org/cn/peakoilindex.shtml

Do other searches on debunking Peak Oil, BOOP (Biological Origins of Petroleum), and abiotic oil.

Be careful cutting and pasting statements that you make out as your own as the authors guard them like zealots.

Skase Jnr
Too good to be true

Thirty06

Frankly I'll be glad to see the back of the stuff.

Nasty thisck sticky black gunge that you have to boil up in whopping great distilleries just to make it fit for anything other than ruining your clothes.

It wasn't supposed to be like this. The space age began in 1957 ish and by now we ought to be whipping round the solar system in ion rocket powered space modules or going from end to end of the country courtesy of linear motor powered suer trains that get you there in time for tea.

So where are we ? sitting in the roadworks on the M25 looking at an opposite facing load of traffic that is probably made up of people making the same journey as we are.

Fact, the southbound trucks on the M1 are carrying approximately the same freight as the northbound trucks.

(possible) Fact, it took billions of years for the sun's energy to be trapped in the form of fossil fuels, releasing it in just over a hundred years looks a bit questionable.

Why the hell are we driving everywhere, it all looks about the same now, alright except for the traffic!!

whgen I was young they rpomised me the moon, what do I get ? Milton Keynes!

Off now to despair while my neighbours, who have a twelve thousand pound fitted kitchen, cook chipolatas over a cheap barbecue.

Onan the Clumsy

The North Pole?

Lance Murdoch

Another good book on this subject is 'The End of Oil' by Paul Roberts. There are so many claims and counter claims made about this subject that it is difficult to ascertin the truth. Surely it is, up to a point, in the oil producers interests to say that there is an imminent oil shortage (keeps the price up).
The fact that there is not as much oil being found may actually be a function of the low oil price in the 1990's. If you can get oil cheaply from Saudi Arabia whats the point of looking for the more expensive stuff in the South Atlantic or the North Pole or some equally difficult environment?
Jet fuel can be synthesised from natural gas and coal. There are already plants that make diesel oil (which is pretty much the same stuff as jet fuel) from natural gas. The South Africans have been making jet fuel from coal for years.
If the price of oil does continue to increase then the most affected country may not be the United States but China. Without cheap oil the Chinese economy will not be able to grow as quickly whereas the US could cut back its consumption significantly over a decade or less.
There may be a shortage for a few years and my advice would be dont buy an SUV (you wont be able to give it away in five years time) and buy stocks in the more reputable oil/gas exploration companies aswell as the major oil/gas producers.