[PRCo] The Oil Crisis

[Fred Schneider]

To all of you:

Unfortunately, the colors will not reproduce when this appears on  
your computers.   I have just had a long conversation with John  
Swindler and decided after I read this to him to put it on line.   
Most railfans are more tuned in to the petroleum crisis than  
outsiders.   Two days ago I had written a note to Alan Schneider, a  
railfan and friend in suburban Washington, DC, who works as a chemist  
for the Federal government, giving him my thoughts on the present  
petroleum situation and asking him to comment.

I can add some additional comments right now.   We all wanted a  
better life for our children than we had but I think that is no  
longer probable, all other things being equal.  If I had the same  
education as my parents, then I think my parents would have had a  
better life style and my children will have an even lower life  
style.   Between my parents and my generation, the decline was caused  
by greater government spending.   In the next generation it will be  
caused by higher energy costs ... we will no longer be as mobile, we  
will pay far more for food, and I can be thankful that I was able to  
see as much of the world as I did.

Of course I put this out there to provoke an argument.   You know that.

I also put it there to get you all thinking.

Now read the dialogue between Alan and Fred:



Alan:

Give me your long range thoughts...

If, as I hear on television and from you, oil production from the
Middle East has peaked or will peak in the next 20 years.

Response:  The important issue is world oil production since crude is  
fungible.
And the answer is that there is reason to believe that crude oil
production has peaked.  This is consistent with what
M King Hubbard predicted back in the 1950's (his predictions
proved accurate in the past (lower 48 oil, lower 48 gas)).  And the
fact that the Saudis haven't increased production makes me suspect
that their oil production has peaked.  Only Iraq
could pump more crude, and the war prevents that (and the oil
fields might wind up in the hands of the terrorists anyway).

And China has increased their use of petroleum six-fold since 1995  
and will have more cars than we do by 2025. And India has a  
developing middle class and I've seen traffic jams in Delhi like you  
just would not believe. Rural India is so poor that many people do  
not have electricity but that is changing as they take our jobs.

Response: You are correct  Other third world countries are
developing too - look at what Japan and South Korea have become!

So, have we used up 30, or 40 or 50 percent of the world's oil so far?

Response: I believe we have used up 50% of the planet's conventional  
oil.  Whether there is enough tar sands to make a difference remains  
to be seen, but I doubt it.  What we are seeing today is what you'd  
expect if we're at the peak year of production.

And in what year will we have no oil left?

Response: We will never have "no oil left" any more than we have no  
gold or platinum.  We won't be able to burn it for transportation  
since it will so expensive to find and the demand so high (the supply- 
demand curve for gasoline is very inflexible).  If you will pay $200  
a gallon you will get it; if you can't afford $200 a gallon you won't  
get it so it might as well be "all used up" as far as your car is  
concerned.


And then what will we used to make plastic seats for our subway cars  
and plastic bags to carry our groceries home?

Response: Plastics come from natural gas rather than crude
oil; Hubbard predicted world natural gas production would peak in  
2010-2020.  You can make synthetic natural gas and oil from coal or  
even wood if you're willing to pay enough.  It's OK to make synthetic  
oil and gas if you are going to make something valuable from it but  
not for burning.  And note that it takes more energy to make corn  
Ethanol then you get when you burn it so that specific answer isn't  
an answer and all.

  What will we use to lubricate our axles?   We don't have enough  
whales....

Response: There are non oil based lubricants - graphite, silicon  
oils, for example.


Has the population grown beyond what the world can support?

Response: Probably we have, but short of nuclear war what can we do  
about it?  When population gets too high for the food supply the  
population will fall - happened many times in the past.

Was our parent's generation the last really good one?

Response: No, our generation has it best, at least up to now  I'll be  
62 Thursday, so I'll be gone when it gets really bad.


Is it good that we will not be here too many more years to see the  
future?

Response: I suspect that's the case, but I can't do anything about it  
so I try not to get worked up.

Can wind farms generate enough electricity to keep us mobile?

Response: We get very little electricity from oil, it's mostly coal,  
natural gas, and nuclear.  Unlike the commercials on TV, we don't  
have 1000 years of coal left in the US.  Rather we have about 60  
years to the peak production year.  I would like to eliminate coal  
and natural gas from electrical generation, using nuclear and wind.   
But it takes a long time to build the generating capacity, even if  
there's no NIMBYism.

Fred Schneider