Peak oil and climate change, are very real threats to human society and not something we can pass off to the next generation, says one of the world's foremost peak oil experts.
Peak oil educator and Research Fellow of the Carbon Institute of Post Carbon Institute Richard Heinberg was speaking to at a lecture hosted by The Engineers for Social Responsibility, Greens on Campus and the Green Party at Auckland University on Wednesday night.
Mr Heinberg is the author of eight books including The Party's Over: Oil, War and the Fate of Industrial Societies, Power Down: Options and Actions for a Post-Carbon World, and The Oil Depletion Protocol.
He said the United States used to be the world's foremost oil producer but was now dependent on importing oil, as well as consuming all the oil produced domestically.
"This situation is being experienced by country after country around the world. Oil exporting nations are gradually turning in to oil importing countries."
He said oil is the primary source energy for the world, but fossil fuels are by definition nonrenewable.
According to Chevron oil production has declined in 33 of the 48 largest oil-producing countries, yet energy demand is increasing around the globe.
Globally 5.2 billion barrels of oil were discovered from new sources last year, but 30 billion barrels were extracted and used, Mr Heinberg said.
He said as developing oil-exporting nations increase their revenues and the wealth of their society increases their domestic demand for oil also increases.
"Out put from new countries that are producing is simply not been to keep up with demand."
He said oil production in the United States was falling far short of domestic demand.
A report commissioned by the US Department of Energy and released in February 2005 asked if peak oil was a real problem.
"The peaking of world oil production presents the United States and the world with an unprecedented risk management problem. As peaking is approached liquid fuel prices and price volatility will increase dramatically…the economic, social and political costs will be unprecedented," the report said.
Mr Heinberg said this report signaled the weight the US Government was now giving to this problem.
"What they are saying here implicitly, this is a bigger problem than the depression and World War II," he said.
He said the market will not correct itself, the most be political and economic intervention.
The discovery of oil in the US peaked in the 1930s and production in the 1990s, he said. And the situation is similar in Great Britain.
"Britain is in the process of becoming a net oil importer after 20-25 years of being an oil exporter."
In 1998 global oil prices were around US$10, but today in some places it costs as much as US$81 a barrel.
He said in 1998 the highest predictions for today's prices were around US$20 barrel.
"If countries can continue to produce more oil and send it to market there is every incentive to do so."
The Cambridge Economic Research Association said capital costs for extracting oil have increased 80 percent since the year 2000.
"The US produces 50 million barrels of oil a day, but still consumes all of that domestically and a lot more."
He pointed to a recent International Energy Agency (IEA) report, which highlighted growing concern for the global economy. In the report dated July 9, the IEA estimated that demand for oil would continue to rise 2.2 percent per year till 2012.
"Despite four years of high oil prices this report sees increasing market demand beyond 2010…It is possible that the supply crunch could be deferred but not by much," the report said.
Kinsale in Ireland was hoping to become oil independent by 2020. And in the UK there were now 36 members of the "transition town movement" which were moving away from using fossil fuel.
"The real question is how we are going to get there and that's really up to us. It's not something you can pass off to the next generation. That's something we did in the 1970s," he said.
He said fossil fuels had formerly been regarded as part of the solution, but now they were no longer being viewed as the answer.
"Farmers are finding they can get more for their crops by selling to fuel and energy providers than if they sell food to their neighbour."
Iowa in the United States was growing so much corn for energy providers if it continued this way they could become a corn importing state, he quipped.
He said you have to look at the energy profit from different fuel sources and at how economic your processes are.
"Six to seven months of hard labour is equivalent to 1 gallon of gasoline," he said.
Head or Engineering at AUT Thomas Neitzert said New Zealand could look in to many renewable energy options, particularly tidal, wind, and solar energy.
Green Party co leader Jeanette Fitzsimmons said the Green Party continues to raise the peak oil issue at Parliament, but has not had a very good response.
"We have to base our economy on a different value system," she said.
Feeds