Our entire way of life is built upon cheap oil. From the cars we drive, to the jets we fly, to the buildings we live in, to the food we eat, to the clothes we wear-- everything that composes the fabric of our modern life is built from machines powered by oil. Oil is a key part in our pesticides and fertilizers, so we are literally “eating oil”. Over the past century, a nearly continuous exponential growth in the consumption of oil is what has powered the amazing economic growth of our global economy, and has supported the quadrupling of the world's population. All of this is about to radically change as we slip into the decline of “The Age of Oil”.
In 1950, the United States produced half of the world's oil and was the largest exporter of oil in the world. Now we can't even produce half of our own oil, and we have become the world's largest importer of oil. Even though today's technology is miles beyond where it was 40 years ago, oil discoveries peaked back in the 1960's. In recent years, we have been consuming 23 billion barrels of oil each year while discovering only around 6 billion barrels annually. In fact, last year for the first time in history, the oil industry spent more money looking for oil than the oil that it discovered was worth! Very dismal results for an oil thirsty planet looking for more oil to fuel economic growth, especially when you consider the huge populations of China and India coupled with their rapidly expanding economies and desires to emulate the consumption patterns of the west.
According to many oil industry experts, just as America's domestic oil production peaked back in the late 1960's then started to decline, global oil production will soon peak and start a downward decline (See Figure 1). This will result in skyrocketing oil prices, much like the Arab Oil Embargo did back in the late 1970's, only this time the crisis won't be easily resolved by a few countries deciding to pump more oil. Reliance on Mid-East oil places the stability of American business at the mercy of one of the worst political hot beds in the world.
Figure 1. The Global Hubbert Peak, forecast of future global oil output. Source: The Twenty First Century, The World's Endowment of Conventional Oil and Its Depletion, By Dr. Colin Campbell, 1996
In the 1970's, when OPEC put the squeeze on the American economy, we simply put the emphasis on developing oil fields outside of the Middle East, like the massive oil fields on the North Slope of Alaska, the North Sea (Britain and the Netherlands), and Indonesia. Unfortunately, the North Sea fields are already running out, Indonesia now imports oil instead of exporting it, and Alaska's North Slope is in decline. Outside of the Middle East, we are running out of places to turn for more oil to fuel our economy and our way of life.
The supposedly huge American and Canadian reserves of oil in the form of tar sands and shale oil wont bail us out either, since they are not currently economically feasible to extract and will consume nearly as much energy to yield their oil as the oil will produce. The massive scale of tar sand and shale oil mining operations required to replace a significant portion of global oil production would have devastating environmental impacts on our planet, including huge contributions of green house gasses (contributing to more global warming), severe air & water pollution.
Want to learn more about Peak Oil and its impending impact on your life? I suggest you start with Community Solution's web site www.communitysolution.org or Matt Savinar's Peak Oil web site, www.lifeaftertheoilcrash.net, or you might consider browsing some of the other recommended Peak Oil books, sites and articles.