The Current Peak Oil Crisis

Total Page:16

File Type:pdf, Size:1020Kb

The Current Peak Oil Crisis PEAK ENERGY, CLIMATE CHANGE, AND THE COLLAPSE OF GLOBAL CIVILIZATION _______________________________________________________ The Current Peak Oil Crisis TARIEL MÓRRÍGAN PEAK E NERGY, C LIMATE C HANGE, AND THE COLLAPSE OF G LOBAL C IVILIZATION The Current Peak Oil Crisis TARIEL MÓRRÍGAN Global Climate Change, Human Security & Democracy Orfalea Center for Global & International Studies University of California, Santa Barbara www.global.ucsb.edu/climateproject ~ October 2010 Contact the author and editor of this publication at the following address: Tariel Mórrígan Global Climate Change, Human Security & Democracy Orfalea Center for Global & International Studies Department of Global & International Studies University of California, Santa Barbara Social Sciences & Media Studies Building, Room 2006 Mail Code 7068 Santa Barbara, CA 93106-7065 USA http://www.global.ucsb.edu/climateproject/ Suggested Citation: Mórrígan, Tariel (2010). Peak Energy, Climate Change, and the Collapse of Global Civilization: The Current Peak Oil Crisis . Global Climate Change, Human Security & Democracy, Orfalea Center for Global & International Studies, University of California, Santa Barbara. Tariel Mórrígan, October 2010 version 1.3 This publication is protected under the Creative Commons (CC) "Attribution-NonCommercial-ShareAlike 3.0 Unported" copyright. People are free to share (i.e, to copy, distribute and transmit this work) and to build upon and adapt this work – under the following conditions of attribution, non-commercial use, and share alike: Attribution (BY) : You must attribute the work in the manner specified by the author or licensor (but not in any way that suggests that they endorse you or your use of the work). Non-Commercial (NC) : You may not use this work for commercial purposes. Share Alike (SA) : If you alter, transform, or build upon this work, you may distribute the resulting work only under the same or similar license to this one. Nothing in this license is intended to reduce, limit, or restrict any rights arising from fair use or other limitations on the exclusive rights of the copyright owner under copyright law or other applicable laws. Therefore, the content of this publication may be quoted or cited as per fair use rights. Any of the conditions of this license can be waived if you get permission from the copyright holder (i.e., the Author). Where the work or any of its elements is in the public domain under applicable law, that status is in no way affected by the license. For the complete Creative Commons legal code affecting this publication, see http://creativecommons.org/licenses/by-nc-sa/3.0/ and http://creativecommons.org/licenses/by-nc-sa/3.0/legalcode. Executive Editor, Design Editor: Tariel Mórrígan Cover design by: Tariel Mórrígan Cover photograph by: Dawn M. Armfield (front) tired (2008). An abandoned car in the Arizona desert http://www.flickr.com/photos/girl-inchoate/2396836783/ Cover photograph by: Duane Smith (back) On the Highway of Death (1991). A destroyed Iraqi tank on "Highway of http://www.flickr.com/photos/airborneshodan/4083071774/ Death" in Kuwait with oil well fires and smoke in background. TABLE OF CONTENTS Glossary Preface 1 Acknowledgements 2 KEY POINTS 3 EXECUTIVE SUMMARY 7 PART I PEAK OIL 1. What Is Peak Oil? 15 2. The Importance of Oil 18 Source of Energy and Fuel 18 Feedstock for Materials 19 Food Production and Distribution 19 3. Defining and Measuring Conventional and Non-Conventional Hydrocarbon Reserves 21 4. Oil Data Is Inaccurate 23 Misreporting, Falsifying Data, Uncertainty, and Lack of Standards and Transparency 23 Organization of the Petroleum Exporting Countries (OPEC) 25 Information and Reporting Organizations 29 The International Energy Agency (IEA) 29 The US Department of Energy (DoE) 32 Private Industry 36 5. Oil Discoveries 39 6. Energy Return On Investment (EROI) 42 7. Conventional Oil Reserves 44 8. Unconventional Oil and Increasing Production Costs 46 Increasing Oil Production Costs 46 Oil Sands 50 Extra-Heavy Oil 51 Oil Shale 51 Gas-to-Liquids 52 Coal-to-Liquids 53 9. Supply and Demand 54 Oil Production and Demand 56 Global 56 OPEC 60 Saudi Arabia 61 Iraq 61 Undiscovered Oil 63 Oil Production Decline Rates 64 Decline Curve Assumption 65 Oil Prices and Demand Destruction 68 Strategic Petroleum Reserves 69 10. When Will Peak Oil Occur? 71 Peak Oil Production 71 Insufficient Capacity 73 11. Why No Warning? 75 12. Mitigating Peak Oil 78 Mitigating Peak Oil 79 Alternative Energy Sources 80 Biofuels 81 Algae Biofuel 82 13. The Consequences of Peak Oil 87 Systemic Collapse and the Decline of Global Civilization 88 Governance Responses 91 14. Future of Climate Policy and Negotiations 93 PART II HUMAN CARRYING CAPACITY 15. Food 97 16. Arable Land 101 17. Irrigated Land 107 18. Water Resources 109 19. Peak Phosphorus 115 Phosphorus : Its Role in Nature and Agriculture 115 Peak Phosphorus 116 Responses to Peak Phosphorus 118 20. Food Waste 121 21. Human Health 122 22. Mass Extinction and Biodiversity Loss 124 23. Climate Change 128 Impacts of Climate Change 129 Worldwide 135 Africa 137 Asia 139 Australia and New Zealand 143 Coastal Areas 145 Europe 148 Middle East 151 North America 151 Small Island States 153 South America 154 Abrupt Non-Linear Climate Change and Tipping Points 156 24. Peak Oil 167 25. Food Prices 172 26. Peak Energy Resources 175 Peak Coal 176 Peak Gas 180 Peak Uranium 185 27. Peak Energy and Carrying Capacity 189 PART III CONCLUSIONS 28. Solutions 197 Crisis and Opportunity 199 Transitions 200 Adaptation 202 Examples of Governance Responses 205 Looking Forward 208 29. Conclusions 210 Appendix 1: Defining Reserve Estimates 218 Appendix 2: The Uppsala Protocol 219 Appendix 3: Resources 221 References 228 FIGURES Figure 1: Ultimate crude-oil production based upon initial reserves of 1,250 billion barrels 16 Figure 2: A theoretical production curve, describing the various stages of oil production maturity 16 Figure 3: OPEC official proved oil reserves 25 Figure 4: OPEC 11 oil reserves 26 Figure 5: Comparison claimed OPEC 10 crude oil capacity versus actual production in 2008 27 Figure 6: Comparison of IEA OPEC 10 crude oil capacity estimates versus actual production 28 Figure 7: Saudi Arabia crude oil production to 2080 29 Figure 8a: World's liquid fuels supply and possible peak around 2010 by Glen Sweetnam 33 Figure 8b: Oil and gas liquids 2004 scenario and possible peak around 2010 by Steven Chu 34 Figure 9a: Graph showing a possible peak in oil production around 2010 by the CEO of Petrobras 36 Figure 9b: Graph showing a cumulative decline in existing fields over time by the CEO of Petrobras 37 Figure 10: Annual 2P conventional oil discovery, consumption, and production 40 Figure 11: Energy return on investment (EROI) 43 Figure 12: Increasing costs and challenges of extracting unconventional oil resources 47 Figure 13: Long-term oil-supply cost curve 48 Figure 14: Production of oil shale in millions of metric tons from 1880 – 2000 52 Figure 15: World oil production by source in the IEA's WEO 2008 Reference Scenario 57 Figure 16: Future world oil production in the U.S. Joint Forces Command's JOE 2010 58 Figure 17: The expanding group of post-peak oil producing countries 59 Figure 18: Historical production of oil in the USA from 1900 – 2009 62 Figure 19: Petroleum overview of the United States 63 Figure 20a: World oil supply according to the EIA 66 Figure 20b: EIA data for global conventional oil production 67 Figure 21: Unconstrained demand started exceeding oil supply in 2006 68 Figure 22: Average monthly West Texas Intermediate (WTI) spot prices from 1986 – 2010 69 Figure 23: Oil Prices from 1861 – 2007 70 Figure 24: World population over time 99 Figure 25: A comparison of anthropogenic biomes (anthromes) for years 1700 and 2000 104 Figure 26: Distribution of Earth's water 110 Figure 27: Water withdrawal as percent of total available water by country between 1995 – 2025 112 Figure 28: Annual and cumulative phosphorus production predicted by Cordell et al. 117 Figure 29: Annual and cumulative phosphorus production predicted by Ward 118 Figure 30: Historical sources of phosphorus (1800 – 2000) 119 Figure 31: Megafauna species that went extinct through time compared to human population growth 125 Figure 32: Biomass of humans plotted against the estimated biomass of non-human megafauna 126 Figure 33: Recent monthly mean carbon dioxide measured at Mauna Loa Observatory, Hawaii 130 Figure 34: Global average temperature relative to 1800 – 1900 and projected to 2100 131 Figure 35: Mean global temperatures during 1999 – 2008 133 Figure 36: Global warming predictions for 2070 – 2100 versus 1960 – 1990 average temperatures 134 Figure 37: Change in water availability compared with average 1961 – 1990 in percentage 136 Figure 38: The world population density, 2000 137 Figure 39: Population density within and outside of a 10 m LECZ for The Gambia 138 Figure 40: Map of the HKHT with major river basins 141 Figure 41: Map of the HKHT with major river basins 142 Figure 42: Population density within and outside of a 10 m LECZ for Vietnam 144 Figure 43: Sea level change during 1970 – 2010 145 Figure 44: Population density within and outside of a 10 m LECZ for eastern China 146 Figure 45: Population density within and outside of a 10 m LECZ for Japan 147 Figure 46: Population density within and outside of a 10 m LECZ for Great Britian 149 Figure 47: Population density within and outside of a 10 m LECZ for northern Egypt 150 Figure 48: Population density within and outside of a 10
Recommended publications
  • Cuba's Food & Agriculture Situation Report, USDA, 2008
    Cuba’s Food & Agriculture Situation Report by Office of Global Analysis, FAS, USDA March 2008 Table of Contents Page Executive Summary........................................................................................................................ 1 Cuba’s Food & Agriculture Situation Report ................................................................................. 3 The Historical Context Underlying U.S.–Cuban Relations..................................................... 3 Economic Background.............................................................................................................4 Cuba’s Natural Resource Base and Demographic Characteristics .......................................... 8 Population, Food Consumption and Nutrition Issues ............................................................ 14 Tourism and the Demand for Agricultural Products.............................................................. 17 Cuba’s Market Infrastructure and the Role of Institutions in Cuba’s Food and Agricultural Sector............................................................................................................ 18 Cuba’s International Trade Situation..................................................................................... 29 Other Observations ................................................................................................................ 33 Summary and Conclusions .................................................................................................... 33 Addendum
    [Show full text]
  • ROMAHDUS Vipu
    ROMAHDUS ViPu Lokakuu 2014 1 Sisällys Lukijalle……………………………………………………… 2 1 Mikä romahdus?…………………………………………… 2 2 Romahduksen lajeista……………………………………… 6 3 Romahduksen vaiheista…………………………………… 15 4 Teoreetikkoja ja näkemyksiä……………………………… 17 5 Romahdus—maailmanloppu, apokalypsi, kriisi, utopia… 25 6 Romahdus ja selviytyminen………………………………. 29 7 Pitääkö romahdusta jouduttaa?…………………………… 44 8 Romahdus, tieto ja hallinta………………………………… 49 9 Romahdus ja politiikka…………………………………….. 53 2 Lukijalle Tämä teksti on osa pohdiskelua, jonka tarkoituksena on luoda pohjaa Vihreän Puolueen poliittiselle toiminnalle. Tekstin aiheena on jo monin paikoin ja tavoin alkanut teollisten sivilisaatioiden ja modernismin kehityskertomuksen romahdus. Tekstin ensimmäiset 8 lukua käsittelevät erilaisia teorioita, käsityksiä ja vapaampaankin ajatuksenlentoon nojaavia näkökulmia romahdukseen. Ne eivät siis missään nimessä edusta ViPun poliittisia käsityksiä tai tavotteita, vaan pohjustavat alustavia poliittisia johtopäätöksiä, jotka esitetään luvussa 9. Toisin sanoen luvut 1-8 pyörittelevät aihetta suuntaan ja toiseen ja luku 9 esittää välitilinpäätöksen, jonka on edelleen tarkoitus tarkentua ja elää tilanteen mukaan. Tätä romahdus-osiota on myös tarkoitus lukea muiden ViPun teoreettisten tekstien kanssa, niiden ristivalotuksessa. 1 Mikä romahdus? Motto: "Yhden maailman loppu on toisen maailman alku, yhden maailmanloppu on toisen maailmanalku." Moton sanaleikin tarkoitus on huomauttaa, että vaikka yhteiskunnan romahdus onkin yksilön ja ryhmän näkökulmasta vääjäämätön tapahtuma, johon
    [Show full text]
  • Oil and Gas Security
    GREECE Key Figures ________________________________________________________________ 2 Overview _________________________________________________________________ 3 1. Energy Outlook __________________________________________________________ 4 2. Oil _____________________________________________________________________ 5 2.1 Market Features and Key Issues __________________________________________________ 5 2.2 Oil Supply Infrastructure ________________________________________________________ 7 2.3 Decision-making Structure for Oil Emergencies ______________________________________ 9 2.4 Stocks ______________________________________________________________________ 9 3. Other Measures ________________________________________________________ 11 3.1 Demand Restraint ____________________________________________________________ 11 3.2 Fuel Switching _______________________________________________________________ 12 3.3 Others _____________________________________________________________________ 12 4. Natural Gas ____________________________________________________________ 12 4.1 Market Features and Key Issues _________________________________________________ 12 4.2 Natural gas supply infrastructure ________________________________________________ 14 4.3 Emergency Policy for Natural Gas _______________________________________________ 16 List of Figures Total Primary Energy Supply -------------------------------------------------------------------------------------------------- 4 Electricity Generation, by Fuel Source --------------------------------------------------------------------------------------
    [Show full text]
  • Equinor Environmental Plan in Brief
    Our EP in brief Exploring safely for oil and gas in the Great Australian Bight A guide to Equinor’s draft Environment Plan for Stromlo-1 Exploration Drilling Program Published by Equinor Australia B.V. www.equinor.com.au/gabproject February 2019 Our EP in brief This booklet is a guide to our draft EP for the Stromlo-1 Exploration Program in the Great Australian Bight. The full draft EP is 1,500 pages and has taken two years to prepare, with extensive dialogue and engagement with stakeholders shaping its development. We are committed to transparency and have published this guide as a tool to facilitate the public comment period. For more information, please visit our website. www.equinor.com.au/gabproject What are we planning to do? Can it be done safely? We are planning to drill one exploration well in the Over decades, we have drilled and produced safely Great Australian Bight in accordance with our work from similar conditions around the world. In the EP, we program for exploration permit EPP39. See page 7. demonstrate how this well can also be drilled safely. See page 14. Who are we? How will it be approved? We are Equinor, a global energy company producing oil, gas and renewable energy and are among the world’s largest We abide by the rules set by the regulator, NOPSEMA. We offshore operators. See page 15. are required to submit draft environmental management plans for assessment and acceptance before we can begin any activities offshore. See page 20. CONTENTS 8 12 What’s in it for Australia? How we’re shaping the future of energy If oil or gas is found in the Great Australian Bight, it could How can an oil and gas producer be highly significant for South be part of a sustainable energy Australia.
    [Show full text]
  • State, Gender and Institutional Change in Cuba's 'Special Period'
    UNIVERSITY OF LONDON 43 INSTITUTE OF LATIN AMERICAN STUDIES RESEARCH PAPERS. State, Gender and Institutional Change in Cuba's 'Special Period': The Federation de Mujeres Cubanas Maxim Molyneux STATE, GENDER AND INSTITUTIONAL CHANGE IN CUBA'S 'SPECIAL PERIOD': THE FEDERAClON DE MUJERES CUBAN AS Maxine Molyneux Institute of Latin American Studies 31 Tavistock Square London WC1H 9HA British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library ISBN 1 900039 05 2 ISSN 0957-7947 ® Institute of Latin American Studies University of London, 1996 CONTENTS Introduction. A Debate on Change 1 The 'Woman Question' and the Revolutionary State 5 The FMC in the 1980s: Adaptation and Resistance 11 'Emancipation' and Instrumentalism 18 The FMC in the 1990s 22 The Costs of Adjustment 27 The Household 35 Non-Governmental Organisations 40 Conclusions 43 Bibliography 51 Maxine Molyneux is Senior Lecturer in Latin American Sociology at the Institute of Latin American Studies. Acknowledgements The author would like to thank Ruth Pearson for productive discussions about shared concerns, Margarita Velazquez and Fred Halliday for comments, and Jean Stubbs and Emily Morris for their help with materials. State, Gender and Institutional Change in Cuba's 'Special Period': The Federation de Mujeres Cubanas 'We have gone through three periods since the revolution: in the first we looked to the state to solve all of our problems, and we managed more or less OK. In the second, from 1988, we found the state couldn't meet our needs, and we were unable to meet them ourselves. Since 1993 we no longer rely on the state because we know that it cannot deliver what we need.
    [Show full text]
  • Peak Oil, Peak Energy Mother Nature Bats Last
    Peak Oil, Peak Energy Mother Nature Bats Last Martin Sereno 1 Feb 2011 (orig. talk: Nov 2004) Oil is the Lifeblood of Industrial Civilization • 80 million barrels/day, 1000 barrels/sec, 1 cubic mile/year • highly energy-dense • easy to transport, store • moves goods and people • allows us to fly (there will never be a battery-operated jet plane) • digs huge holes and puts up huge buildings • ballooned our food supply (fertilize, cultivate, irrigate, transport) • our 'stuff' is made from it (iPods to the roads themselves) • we're not "addicted to oil" -- that's like saying a person has an "addiction to blood" Where Oil Comes From • raw organic material for oil (e.g., from plankton) is present in low concentrations in ‘all’ sedimentary rocks, but esp. from two warm periods 90 million and 140 million years ago • temperature rises with depth (radioactivity, Kelvin’s mistake) • oil is generated in rocks heated to 60-120 deg Celsius • rocks at this temp. occur at different depths in different places (N.B.: water depth doesn't count) • oil is ‘cracked’ to natural gas at higher temps (deeper) • abiotic oil from “crystalline basement” is negligible, if it exists • exhausted oil fields do not refill Recoverable Oil • oil must collect in a “trap” to be practically recoverable • a trap is a permeable layer capped by an impermeable one • obvious traps: anticlines, domes (“oil in those hills”) • less obvious traps found by seismic imaging: turned up edges of salt domes, near buried meteorite crater (Mexico) • harder-to-get-at traps: shallow continental shelf (GOM) • even-harder-to-get-at traps: edge continental slope (Macondo, resevoir pressure: 12,000 pounds [6 tons] per sq inch) • essentially no oil in basaltic ocean floor or granitic basement (Used to be!) Second Largest Oilfield Cantarell used to supply 2% of world oil (water) Guzman, A.E.
    [Show full text]
  • 1 OXREP the Future of Fossil Fuels – Is It the End? Dieter Helm1 12Th January 2016 Abstract Contrary to the Assumptio
    OXREP The future of fossil fuels – is it the end? Dieter Helm1 12th January 2016 Abstract Contrary to the assumptions underlying much of current energy and climate policies, fossil fuels have fallen and may remain at the new “normal” levels. In the medium term, Iran and Iraq have considerable potential to increase their outputs, and the new shale technologies will gradually globalise. Longer term, new technologies in electricity generation, storage and smart demand side technologies, together with electric cars and the shift towards digitalisation and new electricity-based technologies in manufacturing, with increase demand for electricity, but not fossil fuels. These new and emerging technologies, rather than international agreements, and the promotion of current generation renewables, will probably bring fossil fuel dominance to a gradual close. To facilitate decarbonisation, energy policy should be directed at enhancing R&D and next generation renewables, instead of supporting existing ones. JEL classification: Q4, L9, O3. 1.Introduction 1 Comments on drafts by Ken Mayhew, Alex Teytelboym, and Christopher Adams are gratefully acknowledged and discussions with Cameron Hepburn, John Feddersen and Ben Irons have also very helped. All errors remain mine. 1 The demise of fossil fuels has been often predicted, but they have proved remarkably resilient. Stanley William Jevons in the nineteenth century worried that Britain was running out of coal, and would as a result have to return “to her former littleness”2. Yet nobody worries that the world is going to run out of coal a century and a half later. For oil, the end has been predicted in almost every decade since the modern oil industry was founded.
    [Show full text]
  • Global Availability of Phosphorus and Its Implications for Global Food Supply: an Economic Overview by Markus Heckenmüller, Daiju Narita, Gernot Klepper
    Global Availability of Phosphorus and Its Implications for Global Food Supply: An Economic Overview by Markus Heckenmüller, Daiju Narita, Gernot Klepper No. 1897 | January 2014 Kiel Institute for the World Economy, Hindenburgufer 66, 24105 Kiel, Germany Kiel Working Paper No. 1897 | January 2014 Global Availability of Phosphorus and Its Implications for Global Food Supply: An Economic Overview Markus Heckenmüller, Daiju Narita, Gernot Klepper Abstract: Being of crucial importance for agricultural production and also having experienced significant price volatility, phosphate and its future availability have drawn growing attention from both academics and the public over the last years. This paper overviews the recent literature and data on the availability of phosphorus and discusses the economic aspects of phosphate scarcity by describing major price determinants of the global phosphate market. We show that past price fluctuations of phosphate rock and phosphate fertilizers are not a reflection of physical phosphate rock depletion but rather attributable to numerous other demand- and supply-side factors. Given the current reserve estimates for phosphate rock, neither an exhaustion of global reserves nor a peak event is likely to occur within this century. However, these estimates are subject to a significant degree of uncertainty. Moreover, the global distribution of phosphate production and reserves is highly skewed and has the potential to pose a threat to food security in developing countries through factors such as the volatility
    [Show full text]
  • Part I: Introduction
    Part I: Introduction “Perhaps the sentiments contained in the following pages are not yet sufficiently fashionable to procure them general favor; a long habit of not thinking a thing wrong gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom. But the tumult soon subsides. Time makes more converts than reason.” -Thomas Paine, Common Sense (1776) “For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst and provide for it.” -Patrick Henry (1776) “I am aware that many object to the severity of my language; but is there not cause for severity? I will be as harsh as truth. On this subject I do not wish to think, or speak, or write, with moderation. No! No! Tell a man whose house is on fire to give a moderate alarm; tell him to moderately rescue his wife from the hands of the ravisher; tell the mother to gradually extricate her babe from the fire into which it has fallen -- but urge me not to use moderation in a cause like the present. The apathy of the people is enough to make every statue leap from its pedestal, and to hasten the resurrection of the dead.” -William Lloyd Garrison, The Liberator (1831) “Gas is running low . .” -Amelia Earhart (July 2, 1937) 1 2 Dear Reader, Civilization as we know it is coming to an end soon. This is not the wacky proclamation of a doomsday cult, apocalypse bible prophecy sect, or conspiracy theory society.
    [Show full text]
  • Peak Phosphorus – the Next Inconvenient Truth
    Peak Phosphorus – The Next Inconvenient Truth Arno Rosemarin Stockholm Environment Institute Phosphorus Seminar Gamla Stan May 19, 2010 The linear path of phosphorus in modern times (Princeton Univ.) Vaccari, 2009 countries as well, mainly in the north; so th the north; so well, mainly in countries as Sulfuric acid which is usedin 90% of the Phosphorus Reserves are in 90% ofthePhosphorus 5 Countries extracting the phosphorus is extracting ere are several geopolitical us challenges ahead of ere are several found in a limited number of a found in Caldwell, SEI, based on USGS, 2009 Phosphate Rock Economic Reserves, 1997-2009 (from USGS summaries) 20 000 000 18 000 000 16 000 000 China k 14 000 000 12 000 000 China Moroc c o & W. Sahara osphate roc South Africa hh 10 000 000 United States Morocco/West Sahara Jordan 8 000 000 Other countries 00 tonnes p 00 1 6 000 000 4 000 000 2 000 000 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 The definition of economic rock reserves is not standardised. China has changed the definition twice after joining the WTO in 2003. In 2009 they downgraded their economic reserve by 30%. There is a need for a world standard and global governance – still non-existent. Depletion of Global Economic Phosphorus Reserves 16000000 14000000 12000000 10000000 years from 2008 tons cc reserve (2% scenario) 8000000 2% annual increase in extraction reserve (1% scenario) 00 metri 00 1% annual increase in extraction 1 6000000 4000000 010 22 2000000 rin, SEI n USGS data aa oo 0 Rosem Based 1 4 7 10131619222528313437404346495255586164
    [Show full text]
  • A Comparative History of Oil and Gas Markets and Prices: Is 2020 Just an Extreme Cyclical Event Or an Acceleration of the Energy Transition?
    April 2020 A Comparative History of Oil and Gas Markets and Prices: is 2020 just an extreme cyclical event or an acceleration of the energy transition? Introduction Natural gas markets have gone through an unprecedented transformation. Demand growth for this relatively clean, plentiful, versatile and now relatively cheap fuel has been increasing faster than for other fossil fuels.1 Historically a `poor relation’ of oil, gas is now taking centre stage. New markets, pricing mechanisms and benchmarks are being developed, and it is only natural to be curious about the direction these developments are taking. The oil industry has had a particularly rich and well recorded history, making it potentially useful for comparison. However, oil and gas are very different fuels and compete in different markets. Their paths of evolution will very much depend on what happens in the markets for energy sources with which they compete. Their history is rich with dominant companies, government intervention and cycles of boom and bust. A common denominator of virtually all energy industries is a tendency towards natural monopoly because they have characteristics that make such monopolies common. 2 Energy projects tend to require multibillion – often tens of billions of - investments with long gestation periods, with assets that can only be used for very specific purposes and usually, for very long-time periods. Natural monopolies are generally resolved either by new entrants breaking their integrated market structures or by government regulation. Historically, both have occurred in oil and gas markets.3 As we shall show, new entrants into the oil market in the 1960s led to increased supply at lower prices, and higher royalties, resulting in the collapse of control by the major oil companies.
    [Show full text]
  • Policy 11.Qxd.Qxd
    1755 Massachusetts Ave., NW Suite 700 Washington, D.C. 20036 – USA T: (+1-202) 332-9312 F: (+1-202) 265-9531 E: [email protected] www.aicgs.org 34 AICGS POLICY REPORT OVERCOMING THE LETHARGY: CLIMATE CHANGE, ENERGY SECURITY, AND THE CASE FOR A THIRD INDUSTRIAL Located in Washington, D.C., the American Institute for Contemporary German Studies is an independent, non-profit public policy organization that works REVOLUTION in Germany and the United States to address current and emerging policy challenges. Founded in 1983, the Institute is affiliated with The Johns Hopkins University. The Institute is governed by its own Board of Trustees, which includes prominent German and American leaders from the business, policy, and academic communities. Alexander Ochs Building Knowledge, Insights, and Networks for German-American Relations AMERICAN INSTITUTE FOR CONTEMPORARY GERMAN STUDIES THE JOHNS HOPKINS UNIVERSITY TABLE OF CONTENTS Foreword 3 About the Author 5 The American Institute for Contemporary German Studies strengthens the German-American relation - Chapter 1: Introduction 7 ship in an evolving Europe and changing world. The Institute produces objective and original analyses of Chapter 2: Climate Change and Energy Security: An Analysis of developments and trends in Germany, Europe, and the United States; creates new transatlantic the Challenge 9 networks; and facilitates dialogue among the busi - ness, political, and academic communities to manage Chapter 3: The Third Industrial Revolution: How It Might Look - differences and define and promote common inter - or Is It Already Happening? 17 ests. Chapter 4: Making the Economic Case for Climate Action 23 ©2008 by the American Institute for Contemporary German Studies Chapter 5: A New Era for Transatlantic Cooperation on Energy ISBN 1-933942-12-6 and Climate Change? 35 ADDITIONAL COPIES: Notes 47 Additional Copies of this Policy Report are available for $5.00 to cover postage and handling from the American Institute for Contemporary German Studies, 1755 Massachusetts Avenue, NW, Suite 700, Washington, DC 20036.
    [Show full text]