These are outlandish and bizarre times we are living through. All around, the seams of our luxurious and abundant reality are fraying and unravelling at frightening speed. The puppet masters are in top gear, flat out giving everything they’ve got in a feeble attempt to perpetuate the status-quo. The winds have changed, though and the fire they started with hand over mouth, giggling, has flared out of control, enveloping everything and everyone, including the status-quo itself.
If you take note of that scent in the air, it’s a mixture of burning, collapsing uncertainty, simmering just beneath the conscious threshold of awareness, releasing toxic fumes of crude oil, smouldering currencies and melting economies. Subconsciously, however, we are all dreading what we’re witnessing all around. Something is more than merely amiss and it’s all tinged with a sickly and surreal shade of pure desperation and danger.
The house rules, or laws of nature, which have been in place since time immemorial, have served humanity well. In recent times, though, the house rules have been abused and treated with a lack of respect. We seem to have forgotten the Incas, Mayans, Mesopotamians and inhabitants of Easter Island and their lessons of collapse.
Even now, at the beginnings of our own modern collapse, we happily take our place in the long line of those who gang rape the sacred house rules in the dirt. We have our home to go to, with food on the table, a car or two and a job to pay for it all, so we’re fine. The dirt washes off with one turn of the volume knob on our car stereo and we tune out. No problem, we can sleep at night.
Whilst we sleep soundly, however, dreaming of the new plasma TV Santa will deliver onboard the credit-card express, the world is struggling with energy dichotomy disorder. A kind of ailment, somehow seeping from the mainstream, declaring that all is well now that demand in crude has temporarily fallen, along with the price. No need to worry unnecessarily, it will be business as usual soon enough.
Yes, it’s true fuel demand is dropping for the first time in twenty-five years. It’s also correct that its price has plunged around 70% from July’s all time high. As a result, the abovementioned syndrome instils in its host the notion that peak oil is no longer a danger to our way of life.
There’s a problem with such a shallow perception of the peak oil issue, though. Now that prices are hovering around the mid forties, the projects earmarked to come online in order to bridge the rapidly growing gap of oil field depletion are now on the back burner. As a consequence, the 6%-9% depletion rates reported by the IEA world energy report will now go unchecked until such time that prices rise to a level conducive to such projects being kick started once again.
By the time this reaches the tap, depletion may have already won the war of oil flow, capping production well beneath the 86 million barrels p/d seen back in the good old days. And just like a trailing stop loss order on the short side, the cap will keep dropping every year. How’s this going to work in an economic framework that requires continual growth to exist and ever increasing energy output to feed it?
There are voices shouting out to drill more and more wells, as this will solve the crisis. There isn’t enough drilling, they scream – that’s the trouble. The truth is, between the years of 1971 and 1981, the U.S aggressively ramped up its drilling operations by 300%, which translated into a mere 10% increase in production. That was thirty-five years ago. There’s less of the black stuff these days as the wildcats will attest. These days, their number seldom comes up on the roulette wheel as they continue on the same course as the sabre tooth. The game has changed and there’s no more room for gambling cats.
If you can imagine an inflating balloon within a tightening vice, the outcome seems quite clear and obvious. Putting aside overly simplistic analogies, demand destruction, supply destruction and recession are short-term cycles – symptoms of a much deeper dilemma. For the current status-quo to continue, we need to keep growing. Problem is, the energy required to fuel such growth is dwindling and what’s left is more expensive for less bang.
This alone signals the end of the party, as Heinberg would put it. Nothing appears to be able to alter that. We are heading into the abyss, never to return to the promised land. On the way down, we’ll have to adjust and adapt quickly, for when the time comes, if we haven’t even accepted our predicament, we won’t stand a chance when the street lights blackout forever and the supermarkets become a wild eccentric fantasy of the past.
Michael
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