posted on May, 24 2006 @ 10:22 PM
Here's a crash course in peak oil. Oil is a remnant of organic material that died very long ago. This organic material was broken down through the
years and later pressurized under the earth's surface. This, over time, produced oil and natural gas reserves. Oil, like all other materials on this
planet, is a finite resource.
Now that we know there is a limit we can understand many things, primarily the conflicts that ensue over the production and acquisition of these
resources. Resource wars if you will. As stated earlier, in order for economies to grow they need cheap energy. In short, with cheap energy consumers
can spend their money on other things, which keeps the economy rolling. The fact that economies are so dependant on cheap energy brings us to why peak
oil is so important.
The problem is not running out. The problem is when the cost of retrieving oil supersedes the profit from selling it. This happens when the reserve is
about dry or a new site is not cost effective. When this happens it is not profitable and on a grand scale you get peak production. This is when
demand overcomes the supply. The demand for oil has been steadily growing. Discoveries have been yielding less and less. This is a sign that the
retrieval of this resource is becoming less economical and production is slowing down.
As production stops growing, so will the worldly economies. At this time, a government's natural defense will kick in so that they remain in power.
Currently this can be seen throughout the conflicts of the Middle East with the U.S. Politics aside, it is easy to see the reasons why we are
concerned with places like Iraq, Iran, Saudi Arabia, Israel, and many others in that oil rich region. What the U.S is currently doing in the Middle
East, is securing this precious commodity so it remains powerful as this resource declines semi evenly throughout the world. Whoever goes down on top
stays on top.
You can also see that the oil crisis is coming by looking at the industry itself. The major oil companies are consolidating. This is a tell tale sign,
that can be seen throughout history, pointing to the demise of the industry. As an industry dies it becomes more and more consolidated because owners
are selling and getting out. The Saudis have a saying: My father rode a camel. I drive a car. My son flies a jet airplane. His son will ride a
Estimates for when the peak production of oil will occur range everywhere from right now to never. The most accurate peak predictions seem to be
sometime between the years 2010 and 2020. I like to be conservative with predictions so it really could be further down the road but most agree that
it will happen within our lifetimes. With peak oil looming over us it is important to understand your government, the governments around you, and how
[edit on 24-5-2006 by Anfro]