Petrol and Diesel are made from the non-renewable energy resource crude oil (also known as Petroleum). Crude oil is created from the compression of dead sea creatures and plants over millions of years. Crude oil is a fossil fuel which means there is only a limited supply and one day it will run out.
As fuel is created from oil, the future for fuel looks quite bleak. We don’t just use oil for fuel, we also use it to create plastics, pharmaceuticals and a range of manufacturing materials. Therefore crude oil is a great resource for the human planet, but unfortunately we are using it at an astronomical rate.
Specialists predict that one day the earth will stop being able to produce enough oil to keep up with our energy needs. This could lead to all oil resources drying up and the world running out of oil.
Most researchers agree that oil supply will decrease and possibly run out one day. However, the date as to when this may happen is uncertain due to conflicting theories.
When oil runs out we will have to find alternative energy resources to fuel our cars. However, countries should not wait for oil to run out before they react, countries should act now to reduce the speed at which oil is being used to make oil last longer. By “Going Green” and using hybrid, solar or electric cars, you could decrease the need for fuel made from oil and improve the lifespan of oil. Even though oil may not run out during your lifetime, it could happen in your children’s lifetime or your grandchildren’s lifetime.
It is not just oil which is depleting; gas and coal are also non renewable and we are using them at an astounding rate. We should all be aware that these resources won’t be around forever and should consider alternative forms of energy such as wind, wave, tidal and hydrogen power which are renewable.
Over the years a great deal of time and money has been spent researching the future of oil as we know it is not an infinite resource and therefore one day run out. Researchers are currently trying to find out when our planets oil reserves will be depleted so we can plan accordingly for the future. The most valued oil theory proposed is the Peak Oil Theory developed by Marion King Hubbert in 1956.
Since ancient times, human beings have used oil in a variety of ways. The Seneca Indians used the oil coming out of natural springs in Western Pennsylvania for medicinal purposes. In 1859, the area became home to the first ever oil well, drilled by Edward Drake. During the Industrial Revolution, oil gradually began to be used in lamps and furnaces, but it wasn’t until the advent of the motor car that demand for oil really began to take off. It is now the main fuel in virtually every kind of transport: not just petrol and diesel in automobiles, but fuel for ships, aircraft and trains all comes from oil. It is also widely used in heating.
As the world continues to industrialise rapidly, demand is increasing year on year, particularly in countries such as China and India. However, it is the US which accounts for the majority of the planet’s oil usage. 25% of oil used in 2006 was consumed in the US, and demand is still rising. It uses 15% more now than it did at the turn of the century. Although there is work being done on researching viable alternatives to fuel oil (evaluated elsewhere on this site), at present demand is going to continue escalating.
This poses a problem for a rapidly industrialising society, as oil is a finite resource. Although there is some debate among scientists, as to exactly how oil is created, there is agreement that it comes from plant fossils being compressed over many thousands of years under certain geological conditions. So far, this process has not been recreated successfully in a laboratory, within compressed time conditions. We must assume then that the oil currently in the ground is all we are going to get. The supply and demand of oil, therefore, has huge political and economic significance, and those controlling the supply can wield tremendous economic and political power.
In a paper presented to the American Petroleum Association in 1956, the geophysicist Marion King Hubbert set forth a model, for predicting the lifecycle of oil supplies, both on a local and global scale. The thrust of his argument was that for any given area, oil production follows a bell-shaped curve. Given the ultimate recovery volume, (ie. the amount of oil in a particular area) and past oil production data, we can create models that approximate the date that 'peak oil' occurs.
After the discovery of oil and the beginning of the extraction process, production increases more or less exponentially, as more wells are drilled and more efficient methods and equipment become available. When half of the oil has been extracted, the supply hits the peak, and production begins to decline as it becomes harder and less profitable to extract the oil. Each side of the graph is symmetrical, and so production should decrease at the same rate that it increased.
The theory was initially regarded with scepticism by the oil industry, but since then, has gained fairly widespread acceptance. This was helped by the fact that US oil production hit its peak in 1970, around the time that Hubbert’s model predicted. However, its usefulness is limited, as it requires the knowledge of the totality of oil reserves in existence. Although much of the 'easy' oil, (ie that which is inland, or offshore in shallow waters) is now discovered and drilled, there are potential reserves in other parts of the world, particularly in deep waters and under the (rapidly retreating) ice caps. A Russian submarine recently planted a flag on the seabed of the Arctic Ocean, claiming the land and any associated resource reserves for Russia.
Similarly, the theory doesn’t take into account, improvements in technology that make extracting oil cheaper and more efficient. Oil that 50 years ago may have been uneconomical to extract, could now be recovered because of the increased accuracy of surveys and the improved quality of drills and drilling methods. The original peak in global oil production was initially predicted to be in 2000, and was then pushed back to 2010. A 2006 report from the Cambridge Energy Research Associates criticised the usefulness of Hubbert’s model, saying,
Despite his valuable contribution, M. King Hubbert’s methodology falls down because it does not consider likely resource growth, application of new technology, basic commercial factors, or the impact of geopolitics on production.
Hubbert’s model may work when everything else remains equal, but of course in real life they never do. A major war in the Middle-East, for example, would skew the graph dramatically as production would almost come to a standstill in the most oil-rich part of the world. This is the thrust of the CERA’s point about Hubbert’s failure to acknowledge external variables, such as geopolitical and economic events.
In a more basic sense, there are some who question Hubbert’s basic assumption that oil is a finite resource. In Russia and the Ukraine, many scientists subscribe to the abiogenic petroleum origin theory. This rejects the notion that oil comes from compressed plant and animal fossils, and postulates that oil is produced on a constant basis from chemical reactions among carbon deposits in the earth’s crust. Although this theory only held any sway in the former Soviet block, it is now beginning to find a serious audience in the west. In their book Black Gold Stranglehold: The myth of scarcity and the politics of oil Craig Smith and Jerome Corsi, two distinguished American academics, come out in favour of abiogenic production. They note that Russia and the Ukraine, where the theory has been most influential, has been transformed from a relatively oil-poor area to one of the most oil rich areas of the world, second only to the Middle-East.
Corsi also criticises Hubbert’s methodology. According to friends, Hubbert came up with the graph on the back of an envelope, and then tried to fit data around it, rather than the accepted scientific method of gathering the data, then designing a model to fit it. He also points out that subscribers to the theory have repeatedly made predictions as to when global peak oil would occur, only to revise them. Predictions have been made for 2000, 2005 and 2010. The theory’s subscribers point to the fact that new reserves have been discovered, increasing the 'total recoverable volume'. Corsi claims that this is a weak defence, saying 'If a theory’s predictions are wrong, then the theory is wrong.'
The internet is replete with doomsayers describing a post-Hubbert’s Peak dystopian world with the human race on its knees.
Hubbert’s model itself doesn’t inherently foretell any disasters. However, when one considers the projected population growth for the planet, along with the rapid industrialisation of many large countries, it becomes clear that it seems likely that demand for oil will be increasing at record rates, just as oil production begins to go into an exponential decline. This massive mismatch of supply and demand will push prices of oil sky high. We have seen record prices recently, with light crude going for over $80 per barrel at the time of writing, and there is nothing to suggest that the upward pressure on these prices will ease, any time soon.
As petrol is so important to us in conducting our everyday lives, significant price increases will cause inflation in the economy, both nationally and globally. The cost of high oil is borne by everyone in society, not just motorists. As supermarkets incur increased costs as transporting their goods become more expensive, the prices of everyday items on supermarket shelves will go up. Also, one of the main counterweights to global inflation over recent years has been cheap consumer goods, manufactured in China. However, high oil prices will force up the costs of production in China, meaning the savings western consumers enjoy will be wiped out.
However, as prices increase, it becomes more economically viable for oil companies to drill for reserves that were previously too expensive. If oil prices were lower, the expenses of drilling and distributing the oil from this reserve would be too high for oil companies to stomach, but with prices where they are today, the margin is acceptable. As prices continue to escalate, other reserves, such as those contained within Canadian oil sands, which were previously too expensive to extract, will become viable, temporarily increasing the supply.
We must acknowledge that high oil prices are here to stay. Even if the Hubbert theory cannot accurately predict when peak production will occur, it is clear that demand is increasing as supply seems likely to decrease.
It therefore seems sensible to identify potential alternatives to oil, and I evaluate some of these elsewhere on this site. We should also seek to limit the amount of oil based products (ie petrol) we use, taking advantage of public transport and limiting unnecessary car journeys as much as possible. We can also use our democratic power to urge the government to change its policy regarding petrol prices. Whereas it is not within our government’s remit (nor should it be in a liberal economy) to regulate the price of oil, the current levels of taxation imposed on road fuel, only add to the burden on the economy. However, if the government is committed to imposing such a punitive level of taxation, effectively making life very difficult for certain sections of society, we must see evidence of what it is using these tax revenues for. Is it subsiding research work into alternatives to fossil fuel? Could it be doing more? Whether Hubbert’s theory is correct or not, we must ensure that our society can function with dwindling supplies of black gold.
Source: Energy Bulletin, 2011. Peak Oil Primer. [online] Available at: http://www.energybulletin.net/primer.php [Accessed 4 August 2011]