Rising Gasoline and Crude Oil Prices? Symptoms of Peak Oil

Shepherd Bliss

Posted Jun 26, 2005      •Permalink      • Printer-Friendly Version
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Rising Gasoline and Crude Oil Prices? Symptoms of Peak Oil

By Shepherd Bliss

The rising prices of gasoline in toward $3 a gallon and more and of crude oil toward $60 a barrel and more are among the growing symptoms of a deeper problem?the global
peaking of our petroleum supply.

Peak oil is the time when the Earth?s supply of the non-renewable fossil fuel of petroleum reaches its mid-point. Oil will continue to flow, but it will become much more expensive and harder to extract. Gasoline is already over $5 a gallon in Europe and elsewhere.

Meanwhile, the demand for oil grows, especially in industrializing countries like China
and India.

China is now the world?s second largest consumer of oil, after the US. One of its biggest
oil companies made an unsolicited $18.5 billion bid June 23 for the California-based
Unocal, a large independent oil company. The bold bid by the state-controlled China
National Offshore Oil Corporation marks China?s growing economic power and its need to secure oil to fuel its further industrailization.

Most petroleum experts agree that peak oil will occur; the date of the peak and its
consequences are debatable. Some geologists have been predicting a peak since the
1950s, thinking that it would probably happen sometime into the 21st century. More
recently a number of prominent oil experts?such as geologists Kenneth Deffeyes from
Princeton and Colin Cambbell, formerly with Amoco Oil, and investment banker Matthew
Simmons—have contended that it could happen during or even before 2007.

The US government is well aware of peak oil. It funded the Hirsch Report, which was
released and suppressed earlier this year. Its lead author, Robert Hirsch, has worked for
the US Department of Energy. Entitled ?Peaking of World Oil Production: Impacts,
Mitigation, and Risk Management,? the report asserts that ?world oil peaking is going to
happen. The development of the US economy and lifestyle has been fundamentally
shaped by the availability of abundant, low-cost oil. Oil scarcity and several-fold oil price
increases due to world oil production peaking could have dramatic impacts.?

The Hirsch Report dismisses the power of the market to solve peak oil and advocates the
need to exclude public debate and environmental concerns. It calls for ?intervention by
governments?because the economic and social implications of oil peaking would
otherwise be chaotic.? The report concludes that ?the world has never faced a problem like

The federal government has chosen to conceal the importance of oil shock. National
governments in Japan, Germany, France, and elsewhere have informed their populations
and made contingency plans for potential economic, political, and social problems.

Some municipal governments in America are also making plans. For example,
Sebastopol Mayor Larry Robinson in Sonoma County, Northern California, has scheduled
a series of town hall meetings in the Fall to address peak oil and related issues, including
the Iraq War.

?My intention is for the peak oil meeting be a community brainstorming session of what we
can do as a community to minimize chaos and the disruption of our lives,? Mayor
Robinson explained. ?Sebastopol is already doing things that will help us prepare for
peak oil?like supporting a farmers market, Solar Sebastopol and programs to encourage
compact, high-density, city-centered living, rather than suburban sprawl that is automobile

?Sebastopol and Sonoma County are uniquely situated to maximize our opportunities for
getting through the crisis. We?re surrounded by rich farmlands. We also have a gentle
climate. Our biggest strength is probably social?our cohesion as a community.?

Nearby Santa Rosa, also in Sonoma County, is home to two of the world?s most active
communicators about peak oil: Richard Heinberg and Matt Savinar. Heinberg is the
author of two recent books??The Party?s Over: Oil, War, and the Fate of Industrial
Societies,? and ?Powerdown: Options and Actions for a Post-Carbon World.? He teaches at
the Santa Rosa campus of New College of California. Heinberg was well-received this
summer on speaking tours to Europe and Africa, as reported on his website

Savinar is an attorney who maintains the popular website www.lifeaftertheoilcrash.com
He is also the author of the book ?The Oil Age is Over: What To Expect as the World Runs
Out of Cheap Oil, 2005-2050.? Savinar?s book employs a unique format?the posing of
113 commonly asked questions about peak oil, followed by his answers. The questions
are grouped in chapters such as ?Alternatives to Oil,? ?Peak Oil and Global War,? and
?Managing the Crash.?

The importance of staying close to home in semi-rural Sonoma County—rather than
moving in a panic—was agreed upon by a group that gathered in small-town Windsor
June 20. Eight people from their 40s into their 60s met for the fourth time to discuss and
plan how to respond personally and practically to oil shock. A similar group has been
meeting regularly in tiny Willits, further north in Mendocino County.

On a round table before the Windsor group were over half a dozen books, including
James Howard Kunstler?s ?The Long Emergency: Surviving the Converging Catastrophes
of the 21st Century.? Earlier in the month Kunstler spoke to various audiences of hundreds
of people at the World Affairs Council in San Francisco?s financial district, at Silicon
Valley?s Google, and at a bookstore close to the University of California at Berkeley.

Retired Santa Rosa fire fighter Andrew Aguilar hosted the Windsor meeting. It included
reports on some of the many peak oil meetings that have been occurring and are planned
in the San Francisco Bay Area. ?Kunstler was somber,? Aguilar reported. ?I’m keeping my
eyes and ears open to find resources to be self-reliant. I had been thinking of moving, but
now I will probably stay here.?

Civil engineer Peter Schurch agreed, ?I go through periods of feeling that I want to flee. I
was going to sell my house. Now I plan to stay here and turn my backyard into a farm.?

(Dr. Shepherd Bliss teaches at the University of Hawai?i at Hilo.  He has
contributed to 18 books, including the essay “America on the Warpath:  A Nation’s Soul at Risk” to the book “Shattered Illusions:  Analyzing the War on Terrorism,” published by
Amal Press, a Muslim publishing house in England.)