Jeff Rubin: Oil and the End of Globalization
theoildrum.com
theoildrum.com
Freight has the advantage that it often doesn't care if it arrives 6 hours late or has to wait around a bunch. That means that we can hit maximal loads nicely. Businesses also tend to pre-plan (at least the ones that do well) so that they can take advantages of the efficiencies offered by going slower.
Passenger transportation just isn't as efficient and would seem to be under a greater squeeze. Even if you go by Amtrak's rail service, to transport a tonne of humans (assuming the average North American body weight of 80.7kg) would use 80x as much fuel as transporting a tonne of freight.
Getting back to freight, a lot of the world's goods are transported by freight truck over land. Freight trucks use 2,426kJ per tonne-kilometer. So, something coming from China over water to the Western US would use considerably less fuel than something from New York trying to get to the Western US. It's under 8,000mi from China to SF and (as the crow flys) 2,500mi from New York to SF. If water-borne transit is 10x more efficient, goods from China still have a fuel advantage over freight truck.
If anything, we'd see the end of freight trucks before we saw the end of globalization. Something coming from China to the Western US and then onto New York by rail would likely use less fuel than something coming from the Western US to New York by fright truck.
I guess I just see freight trucking and passenger trips ending considerably sooner than the water-borne and rail transit that would enable globalization to continue.
Manufacturing them, on the other hand....
I sincerely doubt that the US government would permit nuclear-powered civilian vessels to be constructed at all, much less allow them to travel freely in international waters.
There are also a number of nuclear-powered icebreakers but most of these are non-military Russian vessels that are used for civilian tours of the arctic.
Fine, but it still would use more fuel than something coming from, as an example, Philadelphia to new York! If the fuel is going to be scarcer and scarcer, than we will be forced to switch back to a proximity-based economy.
I also forgot to include the truck (frightening or otherwise) :-)
Overally, i feel these concerns of 'peakers' are nonsense, the free market will help switching for other sources of energy, and science and technology already brought us to the point where it is possible, it's all about scaling now.
I don't know yet for sure if it's possible to maintain our current quality of life given the resources we have at our earthly disposal.
Yes, but how can we collect that 1%? Even considering 100% efficiency for solar panels, we'd need to cover 1% of the global Earth surface (land and oceans). Even more, we'd need at least to double it in order to have a 1% covered 24h/24. I'm afraid we don't have all the required material.
PS: There are also plenty of raw materials to cover the earth in solar panels but that's hardly unnecessary. But as far as the raw numbers go, covering 10% of the worlds oceans with floating solar collectors is vary doable and has a lower impact. (At the cost of significant climate change.)
PS: Or ~1.5% with 33% efficient solar panels. Which might seem like a lot, but we already use a lot of land to generate energy.
The question is: which ones?
What this means to me is that energy prices, which have been supply constrained since the mid-1970's are going to continue to go up by fits and starts, and occasionally go down but it's a ratchet overall. This does have huge ramifications all across the economy. It won't be a drastic end like many of the peakers predict but a very slow crunch.
In other words, the current economic troubles will continue by fits and starts more or less since they have since oil stopped being a demand-constrained commodity. I think you can trace most of the economic problems in recent decades to instability and supply constraints regarding energy. This has also helped fraud along, as in the case of Enron.
The more we can do without oil, the more we can do. But energy return on investment is an important problem to solve and it isn't clear we have sufficient solutions available.
I think you have to look at this relative to demand because the end of cheap oil requires demand exceed supply which it appears to have done since the oil crisis of 1973 (the oil crisis itself may have been political) but it only could have happened because there was a growing understanding that oil was a limited and finite resource (discovery had already peaked and reserves were about to). This has lead to a post-1973 world where oil producers do not increase production to meet demand, leading to price instability and little changes resulting in occasional price spikes, something we never saw before '73.
"World proved natural gas reserves at end-2011 were sufficient to meet 63.6 years of production"
That's at current rates. If we were to switch to an exclusively natural gas infrastructure, this number would of course drop sharply. Natural gas is an appealing alternative, but there just isn't enough of it. And before anyone whips out the old "they'll just find more" canard - not really. The primary reserves of natural gas we're tapping now have been known about for a long, long time, and there are few new discoveries in the pipeline. A similar situation exists with Petroleum.
Who's estimates? I notice the article doesn't mention. Personally, I tend to stick to estimates from the likes of BP and Exxon, since I figure they know what they're talking about.
I do wonder why we're not switching from oil to natural gas a lot faster though.
It also says:
> Two hundred and twenty five bucks. In April 2008, Jeff Rubin, chief economist at CIBC World Markets, predicted a barrel of oil would cost $225 by 2012. With oil at $118, it was a controversial call.
Can a large cargo ship be run using only liquid natural gas? Can we power generators using just natural gas?
I'm very curious about the limits of natural gas as a power source.
The fuel system needs to be adapted to handle the natural gas though. Looking around, it appears that there are vehicles on the road that can switch at pretty much the push of a button.
It explains the process pretty well. It's really a shame it's so expensive when you really don't need that many parts or modifications.
Short version: The market works.
Slightly less short version: You would switch to natural gas if natural gas achieved the same goals at oil at enough of a lower cost to make it worth the switching costs. Part of the cost of oil is based on people's projections of the price of oil in the future; if one expects oil to be much more dear in the future than it is now, one should either buy oil and consume it now or buy oil and sell it later. Buying oil today drives up the price of oiil.
One plausible reason one could think that oil would be more expensive in the future is if one thinks demand will outstrip supply. If one believes the future will hold an acceptable substitute for oil, one will be less likely to believe that future demand will exceed supply, and as a result one will believe the future price for oil will decline relative to today. This causes one to sell oil, propagating the price fall in the oil-demand-has-fallen future into the oil-demand-has-not-fallen-yet today. Which, at the margin, slightly delays "the future."
Or, to put it another way: the credible announcement that we're ten years away from totally solving fossil fuels would cause the present price of all of them to crater.
Because it meets several requirements for an economy of global scale, not the least of which are extremely high energy density and ease of transport.
"I do wonder why we're not switching from oil to natural gas a lot faster though."
A combination of market forces and the fact that our entire infrastructure is geared towards petroleum - not the sort of thing you can replace with any ease or quickness.
Also,
>What is peak oil going to do to population carrying capacity?
>I've heard mass food production is very dependent on synthetic fertilizers made from natural gas. How long before peak natural gas affects food production capacity?
>How big of a mess will the grid become when we have a bunch of electric cars on the roads?
>Without a substitute for oil-powered automobiles, just how much higher will the unemployment rate go, and how much civil unrest will that cause?
The way I see it, we really only have two choices: nuclear (fusion) power; or "A World Made by Hand".
Solar doesn't provide much energy density. (unless you can build a Dyson sphere or a "Ringworld" and convert huge amounts of solar radiation for transport)
Methane has more energy per KG than oil, but much less per cubic meter. (in addition to low density, you need a strong/heavy tank to put it in). And it's a fairly finite fossil fuel.
Uranium and the like are also a somewhat finite fossil fuels (even if from extinct supernovas, rather than ferns and dinosaurs).
Hydrogen (fusion) on the other hand, pretty much defines the useful lifetime of the universe. That's how I define "sustainability".
That's true! That's true and funny! Hydrogen fusion does define the "useful" lifetime of the universe (ie: the interval before the entire universe becomes mainly full of cold heavy metals), but the stars are going to be burning for a few more billion years because fusion is an "unlikely" process. Yes! The solar system is still as we know it, with the planets well separated from the Sun and not yet conglomerated into a big red giant, for the same reason for which we are struggling to get fusion in our labs: because that's difficult! You need enormous temperatures to convince hydrogen atoms to come together and mix their nuclei, and so you get a lot of problems in controlling the overall process.
Sure, we can try with cold fusion, but unfortunately we have not yet got a useful result. But we can insist. Actually, I think we must insist! I can't imagine a better source of energy than cold fusion, if we ever get there. Yes, we must definitely insist!