The Long Emergency: Oil Crisis & US Economy Impact

[polyb]

Having read a lot about the so called peak oil production and the consequences that may be coming, I felt pretty comfortable posting this in order to kick start a thread on whether this is real or not and perhaps what needs to be done about a looming crunch in oil production. Yes I know it is RollingStone, a most reputable publication , but it has been well noted for a while that there is quite possibly a limited supply of this resource. The economic and political ramifications could be devastating as portrayed by this article.

The Long Emergency

What's going to happen as we start running out of cheap gas to guzzle?

By JAMES HOWARD KUNSTLER

A few weeks ago, the price of oil ratcheted above fifty-five dollars a barrel, which is about twenty dollars a barrel more than a year ago. The next day, the oil story was buried on page six of the New York Times business section. Apparently, the price of oil is not considered significant news, even when it goes up five bucks a barrel in the span of ten days. That same day, the stock market shot up more than a hundred points because, CNN said, government data showed no signs of inflation. Note to clueless nation: Call planet Earth.

Carl Jung, one of the fathers of psychology, famously remarked that "people cannot stand too much reality." What you're about to read may challenge your assumptions about the kind of world we live in, and especially the kind of world into which events are propelling us. We are in for a rough ride through uncharted territory.

...
http://www.rollingstone.com/news/story/_/id/7203633?rnd=1111968415270&has-player=true&version=6.0.12.857

Since this forum is full of us science types I figure that the topic does need focus because it quite possibly is only a matter of time. Considering that the vast majority of the American economy is based on oil, it does not require much inspection to confirm, what will happen if this crunch comes along and what can be done about it? The whole economy and military depend on this resource, without it America will not be able to maintain it's position as a 'superpower', economically or militarily. Since the decisions have already been made to not be more conservative with these resources how do you think the possible scenario will play out? Is this truly the 'Achilles heel' of American prowess?

Thoughts, speculations, and incriminations are welcome!

 

[selfAdjoint]

For me the "other shoe" dropped when I found that Saudi crude, which used to be the gold standard of light, "nice" oil, today only comes in heavy, i.e. salt contaminated form. They pumped and sold the light crude that floated on top of the pools of heavy, now they're down to the underlayer. There may be a lot of that heavy crude available, but it necessarily costs more to refine. And of course the article is correct that some experts have put the world peak date close to 2010, but also of course, other experts have pooh-poohed that idea.

For me the answer is a rational conversion to nuclear energy. Modern reactor technology, such as IFR, and other types that have been discussed on the Nuclear Engineering forum, makes nuclear a much more viable choice that it used to be.

 

[GENIERE]

For me the "other shoe" dropped when I found that Saudi crude, which used to be the gold standard of light, "nice" oil, today only comes in heavy, i.e. salt contaminated form. They pumped and sold the light crude that floated on top of the pools of heavy, now they're down to the underlayer. There may be a lot of that heavy crude available, but it necessarily costs more to refine. And of course the article is correct that some experts have put the world peak date close to 2010, but also of course, other experts have pooh-poohed that idea.

For me the answer is a rational conversion to nuclear energy. Modern reactor technology, such as IFR, and other types that have been discussed on the Nuclear Engineering forum, makes nuclear a much more viable choice that it used to be.

The high price of oil is about 20 years late in arriving. Higher oil prices require a switch to alternative power sources. A fission power plant with a design goal of 25 years is the best immediate alternative energy source. This can be coupled with hydrogen production, storage, and distribution, to solve the transportation problem. Windmills also offer an immediate and proven source albeit likely limited to 10% or so of total need. I don't see much hope for solar (photo voltaic) power due to low efficiency but maybe 1-2% of total need.

IMO fusion power is the solution of the not-to-distant future, hoping that it may be in use in less than 25 years. To realize this a worldwide research effort must be made. This will require immense funding I hope can be gotten from a word wide tax of $5.00 a barrel. The funds will support several intensely competing, government-independent laboratories. If there were three foreseen means of obtaining fusion, then I would hope there would be at least three labs dedicated to each of the three technologies. These labs would pay large salaries to attract the best of the best. Financial incentives would be given to reward sharing of “break-through” technologies among labs. The directors would not necessarily need to be scientists but would have to be in the mold of General Leslie Groves (Manhattan Project) or Admiral Hyman Rickover (nuclear submarine); people who can drive a project home.

...

 

[selfAdjoint]

IMO fusion power is the solution of the not-to-distant future, hoping that it may be in use in less than 25 years.

"Usable fusion is fifteen years ahead now, and it still will be in fifteen years". I remember the stellarater. And the tokamak. And the zeta-pinch. And...

 

[GENIERE]

"Usable fusion is fifteen years ahead now, and it still will be in fifteen years". I remember the stellarater. And the tokamak. And the zeta-pinch. And...

The very large financial commitments made by the 6 key nations involved in the ITER fusion project would only have occurred if their governments were not certain of the success of the project. The project is presently being delayed by political haggling between the site location, France or Japan. The US, under President Bush, is committed to 1.2 billion US dollars or about 10% of the foreseen total cost. It is not likely the US will remain in the project if the site is located in France, nor will Japan and S. Korea. Europe, with China and Russia will likely go it alone while the US, Japan, S Korea, and probably India may team up. This is unfortunate as there is not enough funding for one intense effort let alone two. The poor economic performance of the EU is going to wreak havoc with continuous financing and without US support ITER will probably be many years behind its target completion in 2015.

I’m sure you’re aware that the Princeton Tokomat produced 11 million watts of fusion power, a superb achievement even though the output power was less than the input power. The ITER device should surpass the breakeven point, but it will only use one of several possible fusion reactions (I think). The US will independently research inertial fusion, but that research is targeted at space vehicles and military programs, with power production a secondary interest.

 

[Grogs]

Apparently, the price of oil is not considered significant news, even when it goes up five bucks a barrel in the span of ten days. That same day, the stock market shot up more than a hundred points because, CNN said, government data showed no signs of inflation. Note to clueless nation: Call planet Earth.

Maybe the government bases 'signs of inflation' on things that are a little less speculative than the change in the price of oil over a ten day period. But maybe that's just me.

It is a certainty though, that it's just a matter of when, not if, we have an immense energy crisis. I can't speak for the rest of the world, but I strongly suspect that the US will drag it's feet on coming up with a solution until we're in big trouble. At that point, I suspect to see a heroic and extremely painful conversion period. One thing I've learned from my history classes is that we're very good at applying a kiloton of cure when an ounce of prevention would have worked just fine.

In the near term, I think the solution has to lie with nuclear fission-based technologies (coal seems to be about the only other viable solution - if you can call it that.) It's a proven technology, with existing reactor designs that can be built immediately. There's also enough Uranium to provide for our energy needs for several hundred to several thousand years. Hopefully by then we'll have the bugs worked out of fusion power, He3 mining operations, etc.

 

[hitssquad]

Light and sweet not the same thing in crude oil

For me the "other shoe" dropped when I found that Saudi crude, which used to be the gold standard of light, "nice" oil, today only comes in heavy, i.e. salt

Sulpher.
http://news.bbc.co.uk/1/hi/business/904748.stm

contaminated form.

Heaviness of crude and sulpher-content of crude are different things. This is why the New York Mercantile Exchange references "light, sweet crude." It is not redundant to phrase it this way. "Light" means "low specific gravity" and "sweet" (as opposed to sour) means "low sulpher." Both high-specific-gravity and high-sulpher-content are considered undesirable characteristics of crude oil.

 

[polyb]

As an aside I would like to note that there is a whole host periphery businesses that will be affected as well. Take a look around you and account for how many different petroleum based products are part of the economy. Though energy and transportation makes for the majority of the consumption of petroleum, there are literally tons of other products that are a direct result of this resource. For example, in the room that I am currently sitting in I have a hard time finding something that in some way is not made from petroleum by-products and distillation. The keyboard and computer I am using is made from plastic, the paint on the walls, the carpet, the syntheic textiles, on and on. The question of how these industries will be affected must be taken into account. Considering the vast amount of products that are directly related to petrol this topic has implications that are far reaching.

Maybe the government bases 'signs of inflation' on things that are a little less speculative than the change in the price of oil over a ten day period. But maybe that's just me.

Aside from the volitility in pricing which has repercussions on being insured against, have you been to the gas pump over the last year or so?

The poor economic performance of the EU is going to wreak havoc with continuous financing and without US support ITER will probably be many years behind its target completion in 2015.

I am having some difficulty in this assesment of the EU economic performance considering that the dollar has sunk with respect to the Euro and the fact that the block has only existed for the last five years. I would not throw the towel in so quickly on the EU.

For me the "other shoe" dropped when I found that Saudi crude, which used to be the gold standard of light, "nice" oil, today only comes in heavy, i.e. salt contaminated form.

Intersting selfAdjoint, I was not aware of this. Even though hitssquad brought in the correction on the specifics I think it should be noted that the use of lower quality crude is an indicator as to where things may be heading.

As for replacing petrol for energy needs, the only viable contender I see at the moment is fission, but at the same time steps are not being taken in this direction even though better reactor design has vastly improved the safety viability of this form of energy. Unfortunately 'fusion' is still in the development process and cannot be considered reliable at the moment. As for hydrogen, unfortunately that is also based on petroleum and instead of being a 'replacement' it is only an extension of the existing oil dependency, as far as I know. Though coal can be used and is reliable it is limited and messy. Windy may have potential but only in limited respects,IMHO. But back to my original point, what about the other products in the market that are directly or indirectly based on petroleum? I'm trying for a wider angle on this topic just because we are so heavily dependent on this resource in a myriad of respects!

----------------------------------------
Apparently I posted too soon! Here is an article about this point from the CS Monitor:

Oil prices spread to grapes, TVs, pizza

 

[Grogs]

Aside from the volitility in pricing which has repercussions on being insured against, have you been to the gas pump over the last year or so?

Yes, and especially in the last 2 weeks (the time period the author is referring to.) Remember that gas/crude oil prices got quite high a couple of years ago and then came back down considerably. Is this a fairly short-term thing or will the prices keep going up? I, for one, can't say, but the author seems to imply that anyone who doesn't make the connection that spike in crude oil prices = inflation is a moron.

As for hydrogen, unfortunately that is also based on petroleum and instead of being a 'replacement' it is only an extension of the existing oil dependency, as far as I know

I think you're thinking of 'hydrocarbons.' Hydrogen could be extracted from water by breaking the bonds between the hydrogen and oxygen molecules. Ideally, your only waste products when extracting the hydrogen would be oxygen and the only exhaust from burning the hydrogen would be water. Unfortunately, hydrogen *is not* a solution to the energy crisis since it takes more energy to extract it than it produces when burned. Hydrogen would be a storage medium (much like the gas in our cars) that would allow the energy from other sources to be transported around.

The reason I mention coal is that I believe you'll see it tossed around as an alternative by the anti-nuclear lobby. Despite the fact that burning coal releases obscene amounts of pollutants into the air, causes acid rain, etc, I think a lot of people would prefer it rather than have anything 'nuclear.'

 

[hitssquad]

Hydrogen would be a storage medium (much like the gas in our cars)

Then why not continue to use gasoline?

 

[russ_watters]

I was going to let this go, but since its been replied to:

Hydrogen would be a storage medium (much like the gas in our cars) that would allow the energy from other sources to be transported around.

Oil comes out of the ground as useable fuel. It is then refined for various specialized purposes, including powering cars. The refining does not change the heat content much, so gasoline, for our purposes, is a "real" fuel.

Hydrogen, on the other hand, is essentially an open-cycle chemical battery.

A hydrogen economy would (at this point) be based partly on petroleum and partly (mostly, in all probabiliity) on coal.

 

[loseyourname]

Natural gas is another non-nuclear option that, though limited as well, is a good deal cleaner burning than coal. The only big issue is that it is transported overseas as liquid and requires regassification stations at the ports it is shipped to. Not many of these stations are in existence and they are rather expensive to build.

 

[vanesch]

"Usable fusion is fifteen years ahead now, and it still will be in fifteen years". I remember the stellarater. And the tokamak. And the zeta-pinch. And...

Hehe, I thought exactly the same (except that the cited time constant I had in mind was more like 30 years: since already about 60 years, we're going to have fusion power in 30 years, commercially )

Honestly, I can only hope for steadily increasing oil prices. That will FINALLY do something about the big ecological mess we're making by pumping all that carbon in the atmosphere, and open up economical perspectives for alternatives (of which I think that fission is, in the middle and short term, the best option).

It will probably also be the cause of major geo-political changes. The only danger is that those attached to their power status (the West and the previously oil-rich countries) will not easily accept their decline and will maybe cause a lot of damage before they are forced to shut up.

 

[hitssquad]

The LNG bomb - imported daily at a port near you

Natural gas is another non-nuclear option [...] The only big issue is that it is transported overseas as liquid and requires regassification stations at the ports it is shipped to.

Another issue is that each natural gas tanker has the explosive potential of a 700 kiloton nuke.
http://www.google.com/search?q=natural+gas+tanker+gallons


A 1.0 megaton surface burst would be only slightly more damaging and would create a 2600-foot-diameter crater with a further 700 foot lip.
http://www.geocities.com/HotSprings/Falls/1984/blast2.htm


More information on blast effects is here:
http://www.geocities.com/HotSprings/Falls/1984/


Japan is concerned:
http://www.iags.org/n0929034.htm

--
In 2000, the U.S. imported 226 billion cubic feet (bcf) of LNG - less than 10% of the 2.6 trillion cubic feet (tcf) imported by Japan.
--

 

[loseyourname]

Another issue is that each natural gas tanker has the explosive potential of a 700 kiloton nuke.
http://www.google.com/search?q=natural+gas+tanker+gallons

The first site listed there is a scare site. If an attack was carried out, most of the gas would spill. Some of it would ignite. None of it would explode, as it is not compressed. Pessimistic estimates speculate that the resulting fire could encompass as much as a half-mile radius, producing heat that could cause first-degree burns as much as a mile away. While that is a concern, it isn't quite the 55 Hiroshimas predicted by the first site in the google listing. It's worth noting that no tanker has ever exploded and no gas has ever ignited during shipping. There have been spills, however, and the deadliest instance of a natural gas accident was a leak from a storage facility of the substance in gaseous form that resulted in the poisoning of about 1,000 people. Crude oil and nuclear facilities have a far worse track record. Coal is disastrously worse.