Excerpts from Colin Campbell's foreword on Michael C. Ruppert's book "Collapse: The Energy and Money in a Post Peak Oil World"

On oil and gas...

"First, they are finite resources formed in the geological past and are, therefore, subject to depletion. Second, they have to be found before they can be produced, the peak of which is long past. ... The economic and political consequences of this turning point for mankind are colassal, demanding far-reaching political responses... Many claims have been made that new technology will counter the natural decline, yet the arguments overlook the irony that the better the technology, the faster the depletion."

Oil Fact #1

Did you know that it requires approximately 7 gallons of oil to produce a tire. The substances needed to produce the rubber is from 5 of those gallons and two gallons to supply the energy to manufacture the tire.

Source: Rubber Manufacturers Association

"Tipping Point" paper spreading across the internet

I have been coming across a paper that's been getting re-tweeted a lot and popping up on two important peak oil sites. The paper is called Tipping Point: Near-Term Implications of a Peak in Global Oil Production (click to download the PDF document) and was written by David Korowicz of Feasta and the Risk/Resilience Network and published on feasta.org on March 15, 2010. The paper has particularly popped up on theoildrum.com and energybulletin.com, both of which are sites that really address the peak oil issue.

Anyway, on the paper's source site, there is a summary with bulleted points that outline the mechanisms of collapse; indicators of post-peak oil decline. Among the points I was somewhat alarmed by two points that state the following:

Peak oil is likely to force peak energy in general. The ability to bring on new energy production and maintain existing energy infrastructure is likely to be severely compromised. We may see massive demand and supply collapses with limited ability to re-boot.

I think this generally summarizes how most other energies and our present energy grid, in America for example, is powered by fossil fuels. Without oil everything else stops. Prior to learning about the realities about alternative energies and how close we are to peak oil, if we're not already passed peak, I was under the impression that the present Green Movement was countering fossil fuel energy shortfall. But since I started down this rabbit hole of sorts, I have been feeling distraught to learn that there is no suitable alternative energy source to replace our current edifice upon which the whole world stands.  I've been searching and reading at night after work for sources that might speak of viable fossil fuel alternatives, but all I've come across is talk along the lines of "too little, too late but let's hope for he best" contingency plans for he worst in the wake of oil decline.  I almost can't blame people for the way they feel when it comes to going through the first stage of grief in regards to the peak oil theory:  denial.

And later it reads...

We argue that one of the principle initial drivers of the collapse process will be growing visible action about peak oil. It is expected that investors will attempt to extract themselves from 'virtual assets' such as bond, equities, and cash and convert them into 'real' assets before the system collapses. But the nominal value of virtual assets vastly exceeds the real assets likely to be available. Confirmation of the peak oil idea (by official action), fear, and market decline will drive a positive feedback in financial markets.

In other words the markets are a canary to keep a close eye on. I don't know if it's really guaranteed that the markets will be a definite "sign of the times" so to speak, but I feel we'd be remissed not to give notice.  Also I'm no Wall Street person, nor do I really understand even 1% of the their jargon, but I'm making an educated guess that where the summary says that when markets start trying change over "virtual assets" for "real assets", it must mean that they are going to try to jettison the mass amount of fiat money that is presently being pumped out, for things of physical value.  For example, like when a person gets rid of paper money and seeks after gold.

I'm going to read this 56 page paper and post any attention grabbing highlights that I might come across.

Present world oil demand per day highest to date

"World oil demand is estimated at around 86 million barrels per day this year, the highest ever level according to the International Energy Agency."

-from Reuters.com in "Financial speculation seen boosting oil price"

Infrastructure Australia council member warns of fresh oil shock

One of the advisers on the Infrastructure Australia council is warning of an impending oil dsafscrunch, which could send the global economy spiralling back toward recession. Curtin University's Professor Peter Newman says peak oil, when demand outstrips dwindling supply, has already hit. However, prices have been kept low because of the global downturn. Professor Newman also blames oil for causing the global recession in the first place, and he's not alone. -from radioaustralia.net.au

Professor Peter Newman of Curtin University who also sits on the Government's Infrastructure Australia Council is sounding the alarm in Australia and calling for a national contingency plan to weather the peak oil crisis that he believes--up until now--has been cushioned by the global recession. But the part of the report that further caused me to raise a brow is when he explained that he further believes that the global oil supply peaked in 2008 and the subsequent decline since then raised oil prices. Therefore as the people who worked several miles from their homes could not afford the gas, but purchased it anyway, thus were faced with a toxic and unaffordable subprime mortgage.

NEWMAN: Peak oil did happen i believe in 2008. 140 dollars a barrel was a massive increase and it didn't happen because some oil exporting country had a revolution or something. it just happened because we couldn't produce enough to meet demand

As for the "cushion" affect, since the bank failures in 2008 through 2009 the global response to stop the failures strengthened the economy and thereby temporarily stabilized oil prices, making them somewhat affordable. As consumers also slowed their buying and unemployment sored, the recession essentially destroyed demand. But the cushioning was/is probably only temporary--and that's just the next argument I believe Newman began to make.

As consumer demand resumes (not only in gas, but everything else) and as the economy tries to re-cooperate we will find that the full-on resumption of growth as we've always known it (infinite economic growth versus finite resources to power it) will cause oil supply to fall short of the renewed energy demand and spur another, possibly harsher, global recession.  This is dangerous and deeply disconcerting.

Newman: The recovery would very quickly unravel, we'd go into the w rather than the v and that w would have a very shaky last part of the letter as well and coming out of it would be not as easy to predict. All of the old formulae would be unravelling and there are people who are beginning to understand that this is a fundamental change not just a quick turnaround that we can do but easily just propping up banks and things we've actually got to do things differently and that means less oil.

(I am in agreement with Newman by further stating that the subprime mortgage bubble in America was a symptom of the peak oil crisis that may have fortunately bought the world some time from oil decline. But moreover it revealed bad business practices in the American mortgage market in the process.)

Now the argument of course will be, has global oil supply peaked? Or more to the point, did global oil supply actually peak in 2008 and spike gas prices? My answer to this question is that all rich nation's leaders begin to, nothing short of, demand OPEC to be clear on our present state of oil reserves. Because if oil is declining, everybody goes down with it. Nothing exists, waiting in the wings to take the place of oil and stabilize an already shaky global economy.

We must shake ourselves of this stupor, or dare I say stupid illusion of security we live in--that life as we've known it will always be.  The road we're on is bound to run out at some point.

Other Source(s):
abc.netau - Global downturn cushioned peak oil impact

Related Link(s):
publicservice.co.uk - Peak oil: Why industry and government should sit up and listen

Quote: "What they don't want you to know about the coming oil crisis"

We have allowed oil to become vital to virtually everything we do. Ninety per cent of all our transportation, whether by land, air or sea, is fueled by oil. Ninety-five per cent of all goods in shops involve the use of oil. Ninety-five per cent of all our food products require oil use. Just to farm a single cow and deliver it to market requires six barrels of oil, enough to drive a car from New York to Los Angeles. The world consumes more than 80 million barrels of oil a day, 29 billion barrels a year, at the time of writing. This figure is rising fast, as it has done for decades. The almost universal expectation is that it will keep doing so for years to come. The US government assumes that global demand will grow to around 120 million barrels a day, 43 billion barrels a year, by 2025. Few question the feasibility of this requirement, or the oil industry's ability to meet it.  

Source: Energy Bulletin
What they don't want you to know about the coming oil crisis
Published Thursday January 19, 2008
The Independent (UK)
by Jeremy Leggett

A little background...

I recently discovered the peak oil crisis through a documentary that I recently viewed after remembering that I first saw it's trailer months prior while browsing the trailers page of apple.com.  The film is called "Collapse" featuring Michael C. Ruppert. 




I viewed the film on a whim as I couldn't sleep and felt like delving into something relatively intellectual.  At this point I must admit that I didn't come away from this film with what I expected from it.  I was literally shaken and terrified by what I learned, but also felt the need to begin to do some deep personal researching for myself.  Why?  Well the logic is simple.  What I heard I believe was compelling.  Furthermore, it's much like the analogy, and I'm paraphrasing, that says that it's better to believe in God and later discover he doesn't exist, than to not believe in God and discover he exists and also punishes unbelievers.  In other words, it's better to find out the truth before it's too late.  So my goal is:  1) get a better understanding what the heck Ruppert and many other experts on the matter have concluded, 2) verify if their findings 3) figure out what the heck to do in light of the impending crisis.

So, I have decided to do my research and blog it as I go along.  Why?  I have a strange obsession with "overshare" and journaling my progress with things I tend to passionately devote myself to--even if only for a short time.  Additionally, I hope that my citizen-point-of-view on this very complex issue turns out to be of help to someone out there on this vast virtual world called the internet.

In closing, I will post links to articles and other sources from time-to-time on subjects that I think are related or helps connect the dots as the world moves forward, ever so blindly to this major issue.

I guess that's it for now.