Peak Oil 101

Let us save you a lot of time. Instead of you having to read a dozen books, visit endless web sites and watch a bunch of videos – we’ve already done that for you. Here is what you need to know in terms of what Transition Town members believe regarding oil.

First -The Big Picture

We, and our parents, have lived our entire lives on the ascent side of the above peak. As we travel down the descent side of the peak, oil becomes increasingly expensive very quickly because it becomes more and more costly to get it out of the ground. We used to just drill a hole in the ground and it would gush out. It was called “sweet, light crude” for a reason.

We haven’t discovered any new oil fields since the 1970’s and even those, like Great Britain’s famed North Sea field, passed their peak of production in the 1990’s.  Now we drill four kilometers down below the Gulf of Mexico or cook it out of the sand of Alberta and are all in a race to explore the Arctic. Would we be doing these things if we didn’t have to? Not if there was any more sweet, light crude we wouldn’t. It costs many, many times more to cook it out of the Alberta tar sands than it did when we just stuck a straw in Texas. And as supply diminishes demand from countries like India and China is rapidly increasing. That is why the price will go up, up, up.

If you look around where you are sitting, you will most likely see that a) almost everything was made using oil and b) almost nothing was produced locally. Both a) and b) also apply to about 90% of the food in your home. Finally, all the ships, trains, trucks, and aircraft that brought you the things in your home run on petroleum products.

Here is the key: we don’t have to actually “run out of oil” to have a problem. All we need is for oil to be just expensive enough that it is no longer profitable for companies to make the products or produce the food presently in your home or for the transportation companies to ship them even if they did. Whatever the number turns out to be, that dollar per barrel price of oil will be the tipping point.

If you think about that graph above and about how far down the other side it will take to reach the tipping point, you should be having your peak moment – the moment you “get it” – right about now.

Next, watch this video of Canadian Jeff Rubin, former Chief Economist of CIBC World Markets for twenty years explaining the above in more detail. Although Jeff is an economist he speaks as plainly as any farmer and he is quite engaging. Of all the books written about Peak Oil, Jeff’s book, “Why Your World Is About To Get A Whole Lot Smaller” is the peak oil book that is most useful in terms of answering the question, “What is going to happen?” and helping you have an idea how to go about answering the question, “What should I do?”

Finally, watch this video from Chris Martenson. Chris will take you on a kind of “zoom in” look at that graph above and explain the numbers in more detail.

At this point, you know all you need to know about Peak Oil. Answering the question, “So, what do I do now?” is what the Transition Initiatives are meant to help you with so it’s recommended you either find one or start one.

If you wish to maintain an on-going program of study with regard to Peak Oil, I recommend “The Energy Bulletin” published by The Post Carbon Institute.