The remaining oil is poor quality, and the energy to get this often remote oil so great that more and more energy (blue) goes into oil production itself, leaving far less — the grey area — available to fuel the rest of civilization. Source: 22 June 2009. David Murphy. The Net Hubbert Curve: What Does It Mean? theoildrum.
This is the scariest chart I’ve ever seen. It shows civilization is likely to crash within the next 20 years. I thought oil depletion curve would be symmetric (blue), but this chart reveals it’s more likely to be a cliff (gray) when you factor in Energy Returned on Energy Invested (EROEI).
The gray represents the actual (net) energy after you subtract out the much higher amount of energy (blue) needed to get and process the remaining nasty, distant, low-quality, and difficult to get at oil. We’ve already gotten the high-quality, easy oil.
Clearly you can’t “grow” the economy without increasing supplies of energy. You can print all the money or create all the credit you want, but try stuffing those down your gas tank and see how far you go. Our financial system depends on endless growth to pay back debt, so when it crashes, there’s less credit available to finance new exploration and drilling, which guarantees an oil crisis further down the line.
Besides financial limits, there are political limits, such as wars over remaining resources.
For a little while you can fix broken infrastructure and still plant, harvest, and distribute food, maintain and operate drinking water and sewage treatment plants, pump water from running-dry aquifers like the Ogallala which grows 1/4 of our food, but at some point it will be hard to provide energy to all food and infrastructure.
The entire world is competing for the steep grey area of oil that’s left, most of which is in the Middle East.
Hubbert thought nuclear energy would fill in for fossil fuels
Gail Tverberg at ourfiniteworld writes “Hubbert only made his forecast of a symmetric downslope in the context of another energy source fully replacing oil or fossil fuels, even before the start of the decline. For example, looking at his 1956 paper, Nuclear Energy and the Fossil Fuels, we see nuclear taking over before the fossil fuel decline”.
The Power of Exponential Growth: Every 10 years we have burned more oil than all previous decades.
Another way of looking at this is what systems ecologists call Energy Returned on Energy Invested (EROEI). In the USA in 1930 an “investment” of the energy in 1 barrel of oil produced another 100 barrels of oil, or an EROEI of 100:1. That left 99 other barrels to use to build roads, bridges, factories, homes, libraries, schools, hospitals, movie theaters, railroads, cars, buses, trucks, computers, toys, refrigerators – any object you can think of, and 500,000 products use petroleum as a feedstock (see point #6). By 1970 EROEI was down to 30:1 and in 2000 it was 11:1 in the United States.
Charles A. S. Hall, who has studied EROEI for most of his career and published in Science and other top peer-reviewed journals, believes that society needs an EROEI of at least 12 or 13:1 to maintain our current level of civilization.
Because we got the easy oil first, we have used up 73% of the net energy that will ever be available, since the remaining half of the reserves require so much energy to extract.
Some other reasons why the cliff may even be steeper
It’s not our oil
Nearly all of the good, high quality, cheap sweet oil is in the Middle East. Most of the remaining oil will need vast amounts of fresh water to get it out, but there is very limited fresh water in these countries. The refineries and other extraction infrastructure are easy targets to damage or destroy by terrorists or in wars as well.
Oil producing countries are using more and more of their own (declining) oil as population and industry grows within their own nation, and they too need to use more and more energy to get at their difficult oil. This results in a similar chart to the net energy cliff — suddenly there will hardly be any oil to buy on the world markets. See Jeffrey Brown’s article “The Export Capacity Index” (one of his statistics is that at the current rate of increasing imports of oil in India and China, these 2 countries alone would be importing 100% of available oil within 18 years).
As we improve our technology to get at the remaining oil, we make the cliff on the other side even steeper as we get oil now that would have been available to future generations.
Investments won’t be made because the payback times will lengthen
Since what remains is increasingly difficult and expensive to find, develop and extract, investment payback periods lengthen, eventually to impossibly long periods, or to periods that approach the useful life of the capital investment (effectively the same limit in the financial dimension as is an EROEI of 1). Which means it doesn’t matter how much might theoretically be underground, the only thing that matters is how much is actually going to be economically feasible to recover, and that is going to be considerably less than 100% of what might be theoretically and technically possible to recover.
Energy is becoming impossibly expensive, as you can see in these photos of The Tallest structure ever moved by Mankind, a Norwegian natural gas offshore platform.
Exponential growth of population
This makes whatever oil we have left last even less long.
Less oil obtained than could have been
Projects maximize a return on investment over a return of every last drop of possible oil. Making money is so important that a lot of offshore Gulf oil that could have been obtained if extracted more slowly remains in the ground to wastefully get it out as fast as possible to make a profit because that’s how our financial system operates: short-term gratification. But hey! That’s less carbon dioxide and global warming, so in a totally unintended orgy of insatiable greed the “there are no limits to growth” billionaires have ironically helped save the planet.
Many energy company CEO’s and other experts the average rate of decline world-wide will reach 8% or higher. If the 8% decline starts at 30 billion barrels in 2015, we’d have only half as much oil in 8 years. That’s too fast for civilization to cope with.
- 2016 = 27.6
- 2017 = 25.4
- 2018 = 23.4
- 2019 = 21.5
- 2020 = 19.8
- 2021 = 18.2
- 2022 = 16.7
- 2023 = 15.4 (half of what we had 8 years ago!)
- 2024 = 14
The decline rate could be less than 8% for a while, or more than 8% if an economic crash prevents the funding of future projects, wars interfere with oil production, the technology to drill for arctic oil isn’t figured out within a few years (we can’t do it yet safely), and so on.
There are several critical areas of the world where the flow of oil could be stopped by war or terrorism.
Wars, cyber-attacks, nuclear war, social chaos
By 2024, if not sooner, the unequal distribution of the remaining oil, starvation generated riots and pillaging, and collapsing economies have triggered war(s), massive migrations, and social chaos.
Shale oil and natural gas can not prevent the cliff. Martin Payne explains: “shale oil plays give us a temporary reprieve from what Bob Hirsch called the severe consequences of not taking enough action proactively with respect to peak oil. Without unconventional oil, what we wind up with is essentially Hubbert’s cliff instead of a Hubbert’s rounded peak”. But this won’t last: “Conventional oil–which was found in huge quantities, in giant fields in the 40’s and 50’s – well those giant fields had huge reserves and high porosities and permeabilities – meaning they would flow at very high rates for decades. This is in contrast to a relative few shale oil plays which have very low porosity and perm and which must be hydraulically fractured to flow. Conventional oil is just a different animal than unconventional oil; some unconventional oil wells have high initial rates of production, but all of these wells have high decline rates. Hubbert anticipated a lot of incremental efforts by the industry to make the right-hand or decline side of his curve a more gradual curve rather than a sharp drop (Andrews)
If any of these wars involve nuclear bombs, then at least a billion people will die.
The unrest has certainly curtailed the ability of oil companies to drill.
Even farmers may stop growing crops once city residents and roaming militias harvest whatever is grown (i.e. Africa as described in Parenti’s “Tropic of Chaos: Climate change and the new geography of violence).
Cyberattacks from China, Russia, and elsewhere have brought the electric grid down in the USA to prevent US military forces for trying to grab the remaining Saudi and Iraqi oil –the armed forces will be too busy trying to maintain order in the USA to venture abroad — nor could they go even if they wanted to, because Chinese and Russian drone attacks will have destroyed all of the United State oil refineries, and we have retaliated against them, so they won’t be able to refine oil either). We’ve also cyberattacked their electric grids. Most major cities have no sewage treatment or clean water. Nuclear power plants are melting down.
There’s no substitute for oil
Steve andrews (ASPO): You mention in your paper that natural gas liquids can’t fully substitute for crude oil because they contain about a third less energy per unit volume and only one-third of that volume can be blended into transportation fuel. In terms of the dominant use of crude oil—in the transportation sector—how significant is the ongoing increase in NGLs vs. the plateau in crude oil?
Richard G. Miller: The role of NGLs is a bit curious. You can run a car on it if you want, but it’s not a drop-in substitute for liquid oil. You can convert vehicle engines in fleets to run on liquefied gas; it’s probably better thought of as a fleet fuel. But it’s not a substitute for oil for my car. By and large, raising NGL production is not a substitution to making up a loss of liquid crude.
The only way I can see this being prevented or the end of oil delayed a few years, is if a government has already developed effective bio-weapons and doesn’t care if their own population suffers as well.
I feel crazy to have just written this very dire paragraph with just a few of the potential consequences, but the “shark-fin” curve made me do it!
Even though I’ve been reading and writing about peak everything since 2001, and the rise and fall of civilizations for 40 years, it is hard for me to believe a crash could happen so fast. It is hard to believe there could ever be a time that isn’t just like now. That there could ever be a time when I can’t hop into my car and drive 10,000 miles.
I can imagine the future all too well, but it is so hard to believe it.
Andrews, Steve. 29 July 2013. Interview with Martin Payne—Is Peak Oil Dead? ASPO-USA Peak Oil Review.