Dwindling oil reserves threaten chaos, finds Mubin Haq - Review of 'The End of Oil', Paul Roberts, Bloomsbury £12.99
In June oil prices hit a high of $40 a barrel and the G8 pleaded with the Opec oil cartel to increase production. Meanwhile the Iraq war continues and not surprisingly energy is grabbing headlines. Paul Roberts' The End of Oil provides a timely, informative and bang up to date analysis of not just the future of oil but of other hydrocarbons (gas and coal), renewable energy and their effect on global warming.
Roberts focuses on the US primarily because it is the largest consumer of energy. It also has the greatest potential to move other nations towards a greener future but in reality is the greatest block to change. However, even the US cannot preserve the current order. There is no doubt that the system of energy is changing. How that change will happen is unclear. The more we continue as 'normal', the more likely change will occur as a traumatic event. The last three times oil production dropped suddenly - 1973, 1979 and 1991 - it resulted in worldwide recessions.
All the evidence indicates that the end of oil is looming. Production will peak between now and 2035. Worse, although the term 'peak' suggests a gradual tapering in oil production, it will actually be more like a cliff edge as the remaining reserves are quickly depleted by a gas-thirsty market. We are therefore moving to a period of greater destabilisation.
New technologies have the potential to take us forward, and Roberts explores these, without ignoring their limitations. One such technology is hydrogen fuel cells, which could be used in cars. Although expensive at the moment this is primarily because they are being built by individuals with PhDs and not mass-produced on an assembly line.
Other forms of energy production are examined including wind, hydro, biomass, solar and even microbes that can eat carbon and turn it into energy, as well as hydrogen-belching pond scum! Progress has been incredibly slow - all of the world's existing solar panels produce less energy than two coal-fired power stations. In part this is due to lack of funding. Since 1947 the US government has spent $145 billion on nuclear research compared with $5 billion on renewables. Furthermore energy-efficiency has been completely sidelined. Despite 100 years of modernising car engines, barely 15 percent of petrol used in a car reaches the wheels.
The move to renewables needs to happen more rapidly because of global warming, which is increasingly having catastrophic effects on the environment. Hydrocarbons currently provide 85 percent of the world's energy and their use is increasing. Roberts provides a raft of alarming statistics which show how chronic the situation will become especially with the growth of the Chinese and Indian economies.
What pushed changes in energy usage in the past (from wood to coal and then to oil) was economics. Price and the superiority of the new product led to its domination. To take account of the real cost of using hydrocarbons Roberts argues they should be taxed just as cigarettes are due to their impact on the health service.
What is stopping change is the enormous amounts invested in the hydrocarbon industry, worth an estimated $10 trillion. No wonder energy corporations are looking to squeeze every last drop of profit from these assets. The result is colossal inertia.
The US, realising it was so dependent on oil, could have moved two ways. It could have started a programme of using renewables which would have provided a long term solution. The short term solution was to use its military and economic power to ensure oil continued to flow to its shores. It chose the latter and invaded Iraq.
But the war was about more than just securing Iraqi oil. Roberts explains it was also about using the massive Iraqi oilfields (which incidentally had the cheapest production costs in the world) to flood the market. Opec would have been powerless to control the resultant tumbling prices, bringing a bonanza of cheap oil to the west. Due to the Iraqi uprising the plan has backfired on an epic scale.
There is no doubt that Roberts is critical of Bush and of the corporations who profit from the status quo. However, he has more faith in the markets and the ability of the US government to enact change than past evidence suggests. He puts forward solutions to bridge the gap between now and when renewables become mainstream. Some of these I agree with while others are suspect. For example he suggests providing Detroit with financial subsidies to increase fuel efficiency in cars and even sees potential for nuclear power. Overall though, this book provides an excellent history of energy and the potential for change. Unfortunately the prospect looks decidedly gloomy.