Tuesday, February 22, 2005

 

Ignore The Elephant

A rather biased but still fancinating take on the loaming concern of peak oil is that of Jan Lundberg. He's not optimistic:

The scenario I foresee is that market-based panic will, within a few days,
drive prices up skyward. And as supplies can no longer slake daily world demand
of over 80 million barrels a day, the market will become paralyzed at prices too
high for the wheels of commerce and even daily living in "advanced" societies.
There may be an event that appears to trigger this final energy crash, but the
overall cause will be the huge consumption on a finite planet.

The trucks will no longer pull into Wal-Mart. Or Safeway or other food
stores. The freighters bringing packaged techno-toys and whatnot from China will
have no fuel. There will be fuel in many places, but hoarding and uncertainty
will trigger outages, violence and chaos. For only a short time will the police
and military be able to maintain order, if at all. The damage that several days'
oil shortage and outage will do will soon wreak permanent damage that starts
with companies and consumers not paying their bills and not going to work.

After an almost instant depression seizes the modern industrialized world,
and nation-states break down, the frantic attempts of people to feed themselves,
stay warm and obtain fresh water (pumped presently via petroleum to a great
extent), there will be no rescue. Die-off begins. The least petroleum-dependent
communities will survive best. These "backward" nations will be emulated by the
scrounging survivors of the U.S. and the rest of the "developed" world, as far
as local food production will be tried - in a paved-over, toxic landscape by
people who have lost touch with the land.


Um, yea. Some folks view this as excessively dark; I think it's possible if not necessarily probable. What's odd is that a risk-vs-probability study would seem to strongly favor weening ourselves off oil, as the cost of doing so should be less than the cost of, well, the end of modern society (even if there's only, say, a 5% chance that we'll ever encounter Peak Oil), but yet the supposedly all-knowing free markets certainly don't support that. And even many of those who see the possibility of a big oil crash don't seem to be concerned, such as this comment on a related Kos post:

If this comes to pass I predict biodiesel & ethanol production will explode,
and local producers are already setting themselves up to be there when demand
for such fuels starts to climb. Until engines are converted to fuel cell
technology, standard combustible engines will be fed these readily made biofuels
to keep operating.


Ya know, biofuels may have some limited applications, but more as an energy storage medium than as an actual renewable resource. More on this whole issue on Peak Oil: Life After The Oil Crash.

Of a bit more immediate importance was a jump in oil prices today, also accompanied by a slide in the dollar:

Late afternoon in New York, the euro (EUR=) was trading around $1.3252, up about 1.5 percent from late on Monday.

How long the news will weigh on the dollar depends in part on whether the euro pushes above a key resistance area around $1.3270, said Tim Mazanec, senior currency strategist with Investors Bank & Trust in Boston.

Meanwhile, GM slashed prices on their "mid-size" SUVs (in quotes because there's nothing mid-sized about a V8-powered long wheelbase GMT360):

GM has steadfastly denied that rising gasoline prices have muted sales of SUVs,
but Ford officials have said that higher prices at the pump are affecting sales.


Interesting timing, for sure.

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