For a while, it seemed like rising oil prices and shrinking supplies might help us kick our greenhouse gas addiction. But if recent research holds true, we won’t be able to rely on the market to rein in global warming any time soon. In a paper published by Harvard’s Geopolitics of Energy Project, Leonardo Maugeri, a former oil executive and current research fellow, concludes: “Oil is not in short supply. From a purely physical point of view, there are huge volumes of conventional and unconventional oils still to be developed, with no ‘peak oil’ in sight. The real problems concerning future oil production are above the surface, not beneath it, and relate to political decisions and geopolitical instability.”
Maugeri does a comprehensive analysis of oil resources and predicts production could increase by nearly 20 percent in the coming decade and prices could collapse, thanks in part to the new opportunities for tapping tar sands and producing shale oil by hydraulic fracturing. “The Western Hemisphere could return to a pre-World War II status of theoretical oil self-sufficiency,” Maugeri writes, “and the United States could dramatically reduce its oil import needs.”
“Leonardo Maugeri’s 75-page report, Oil: The Next Revolution, might be the most important document in public policy today,” writes Bruce Fisher, director of the Center for Economic and Policy Studies at Buffalo State College, in Artvoice. “Cheaper and endlessly abundant oil for the next couple of decades means, one expects, that the alternative-fuels industry will get slammed. Energy-efficiency programs will get ignored or at least unfunded. Greenhouse gas emissions won’t be curtailed.” Cheaper oil also means more suburban growth, he writes.
“There is enough oil in the ground to deep-fry the lot of us,” writes George Monbiot of The Guardian, “and no obvious means to prevail upon governments and industry to leave it in the ground.”
The Sierra Club’s blog has a more optimistic take: “Getting beyond oil, it turns out, isn’t something that we’ll do because we run out of it. It’s something we’ll do because we need to preserve our livable planet.”
I encourage authors like you who write about conventional oil and unconventional oil that you try to keep in mind just two simple things: 1.) affordability of all of this “new oil” and 2.) the old EROEI challenge. Solve these two very important challenges and who knows we might end up with a lot of “cheap oil”. This rest of the challenges are a lot easier to solve by comparison..
Paul Davis
Daniel
Apart from the questions raised about the assumed depletion rates in discussing that report, one cannot properly discuss energy availability without also discussing declining energy profits – Energy Return on Energy Invested (ERoEI).
Declining ERoEI is a critically important but little known problem; energy profits made by investing energy to gain energy are on a declining trend; substituting tar sands and biofuels for conventional oil will accelerate that decline in ERoEI
The trend is for energy operating costs to eat more and more into the energy profits from fossil fuels and the energy profits from biofuel substitutes are even lower; but our realisation of declining ERoEI will likely be when energy resources cease to be economic.
It seems to me that unless we find a fantastic clean energy source that ALSO has a very high ERoEI, we face an Event Horizon. The transition to Renewable Energy needs a front-end investment of real fossil energy to make it happen; so could Energy Transition ultimately be limited by declining ERoEI – energy profits – and at the same time, the restricted availability of fossil fuels ?
If you accept that outlook, then we must quickly decide whether to burn off the remaining fossil resources trying to extend our current lifestyles and inefficiencies – and suffer the climate consequences – or invest them now in a resilient and sustainable energy system, accepting a less profligate energy future.
Maugeri’s report is deeply flawed. While it is true that the supplies are in the ground, they will be much more expensive to extract from deep water wells, tar shales and tar sands than the dwindling supplies of free flowing crude oil. In addition, the price of petroleum is no longer set in the United States. Also, the imbedded energy required for production of crude from new and dirtier sources is much higher. Petroleum prices are now set according to global markets. The US now competes with the rest of the world for supplies, even if the supplies are sourced in US territory. For example, the reason that diesel has risen above the cost of gasoline in recent years is because American producers can sell refined deisel for more overseas than they could previously get for it at home. So, the price will be much higher and the incentive to conserve will still be economic.
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