Notice: Undefined index: HTTP_REFERER in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 27 Warning: fopen(): open_basedir restriction in effect. File(d:/wwwroot/modalchoice/private/pagetracker.txt) is not within the allowed path(s): (d:\wwwroot\hostyourdomain\modalchoice\modalchoice.com) in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 30 Warning: fopen(d:/wwwroot/modalchoice/private/pagetracker.txt): failed to open stream: Operation not permitted in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 30 Notice: Use of undefined constant year - assumed 'year' in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Notice: Use of undefined constant yday - assumed 'yday' in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Notice: Use of undefined constant hours - assumed 'hours' in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Notice: Use of undefined constant minutes - assumed 'minutes' in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Notice: Use of undefined constant seconds - assumed 'seconds' in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Warning: fputs() expects parameter 1 to be resource, boolean given in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 31 Warning: fclose() expects parameter 1 to be resource, boolean given in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 32 Gobal Energy Demand
BACK

Global Energy Demand

Most of what we have heard about the availability and price of oil since the Big Oil Shortage of the 1970's has revolved around production and the continual free flow of product from beneath the sands of the Middle East to the neighborhood pumps in the American suburbs and along the most rural stretch of Inter-state highway. As we stood in long lines and conspired to be able to get fuel on an even numbered day with an odd-numbered license plate, i.e. two vehicles between which one could exchange fuel, or illegally by swapping plates, it always remained that the supply was not in doubt. Only the delivery was the uncertainty. In those days, fuel was priced in the range of 25 to 30 Cents per gallon and we sucked it down at the rate of 8 to 10 miles per gallon through carburetors that dumped fuel down the throat of the engine and spewed a huge portion of the energy content into the air as exhaust.

In those days the US was the biggest consumer of petroleum fuels. Petroleum was so plentiful that we amply made everything imaginable out of the long carbon chain molecules. In 1968 Mr. Robinson confided to Dustin Hoffman, in the Graduate, that the one word to remember is "plastics. "

Since those days, the 800 million painfully rural and subsistence level Chinese people have become 1,300 million upwardly mobile Chinese people who seem to have a new found taste for octane. Their growth can be measured in annual NYC Units1.

India has likewise grown geometrically to over 1,000 million people and they are in need of liquid fuel too. The per capita fuel consumption of these two nations is far less than in the US, but they amply make up for that in their numbers and the growth of their need.

Just as the global capacity for oil production is peaking, or possibly reaching a plateau, world demand by emerging populations is growing with no peak or plateau in sight. Barring some manmade culling event, or one promulgated by natural forces, the Asian population will continue to grow as long as food production lets it. Then the contest will be over the means of production of food before that of energy. No hungry nation will be willing to distill its grains for liquid fuels when the people need to eat it. Therefore the future of Ethanol2 is probably highly limited. In the short term, though, before we fully realize the impacts of biofuels on the food supply, ever increasing tonnage of grains will be diverted from the food supply into the fuel supply. Although the demand for fuel keeps rising, eventually the demand will fall when people are too weak and too few in number from massive starvation.

As we have seen in decades past, once the Genie is out of the bottle, it is nearly impossible to get him back in to it. China has embarked on the road to high energy consumption and it is a one way road. Even if they make policy that personal autos are the least desirable mode of transport and continue to build gigantic public transport systems, they still will need to light, heat and cool massive residential complexes that do not yet exist. Four to five NYC Units of housing must be built every year just to keep up with the growing population. Those population centers will need food distribution and waste collection even if nothing else is done on a daily basis. People at rest still consume calories and product wastes. Beijing today is a smog-choked city already and China's growth in fuel demand shows no signs of waning. The government doesn't appear to be interested in curbing the pollution level at this early stage of their breakout development.

There are those among us that believe that the US has waged war on two fronts to secure the access to oil reserves and the means of production for an addicted nation. Even so, we still count ourselves among the nice guys of the world. Consider the foreign policy of a nation like China when they decide that it is in their national interests to secure the remaining fuel supplies for themselves. There are two ways of obtaining a larger portion of a limited resource: Outbid your competition and use force to secure the monopoly. The US usually takes the stance that it can outbid the competition, but will work behind the scenes to create a conducive environment that favors American interests. Nations like China have been known to roll out the tanks and troops to quell domestic civil dissent. Unlike the lone man in Tiananmen Square who stood in the path of a reluctant tank operator, I would not want to be in the path of China when it goes on the move to secure its national fuel interests.

For the foreseeable time, China still has ample space on which to expand with its residential zones. Technologies seem capable of providing the food and caloric requirements of their burgeoning population. What it cannot do domestically is satisfy its BTU requirement of a modern urban society. We have seen in our reluctance to develop alternative sources of energy for our domestic usage what China sees in its lack of ability to provide for its own energy usage. Neither of us has moved expeditiously to create a permanent solution for supplying our respective energy needs. Naomi Klein, in her book "The Shock Doctrine" presents a compelling argument that America, and China both, have embarked on a course of action where massive disaster is a new starting point for a refurbished economy and landscape. That concept also figures in with another book of mine, "It's All Tuna!" wherein Capitalist principles reduce the true value of everything in the buying and selling of it. People and their needs are reduced to a profit center that makes wealth people even wealthier.

So here is where the PIC3 enters the picture. Chinese growth in energy demand is coming from two sectors: the new population that never existed before and from the new found affluence of the existing population which is now demanding a larger share of the energy budget. Next year there will be about 26 million more people in China. And in ten years, about 250 million more. That number is almost 1 USPE4. International diplomacy is not the strong suit of the Peoples Republic of China (or for the USA for that matter.)

Afghanistan is strategically situated between China and the Middle East. Iraq is likewise situated. Only Iran is left sitting in the middle of that broad territory. With the US military firmly entrenched in those nations for at least the next decade, China would be loathed to trespass in order to move troops and materials into the Middle East to soften the business environment there and possibly settle the Israeli disruption of international wellbeing. This is not to say that Israel is a troublemaker, but its existence does lead to the continued world instability due to Muslim distaste for it being situated in the heart of its proclaimed holy land.

With the US military positioned in Afghanistan and Iraq, China has a very long march through a half dozen former Republics of the Soviet Union and around the Caspian Sea to arrive at the border of Israel. Likewise the Red Sea is well saturated with the US Navy from the Horn of Africa to the Suez Canal. The only sea-based access for China into the Middle East is around South Africa and in to the Mediterranean via Gibraltar, a trek of several weeks duration. China would not like to confront the US on the way to the Middle East but would have little resistance from Persian or Arabian sovereigns along the way if they were destined for an overrun of Israel. With the US fortuitously ensconced in their path, China would not even begin the move.

No one wants a nuclear exchange over this issue, so eggshells and onion paper will be strewn in the way. Missiles and bombs will not irradiate Israel nor extricate the Hebrews from that land. Only an overwhelming force of manpower can drive them out or deport them after successfully occupying every corner and crossroads. China is the only nation with the singular will to undertake such an endeavor and the available personnel to muster the millions of uniformed soldiers to carryout the operation. And whereas the Bush Administration and the American war machine believed that we would be greeted as liberators by Iraqi civilians, the Chinese actually would be welcome as people passing through and leaving only footprints and tire tracks as they passed.

Israel has been most fortunate in its short and tumultuous history. They have trained their soldiers well and have groomed their relationship with America so as to be a well equipped military. Their 1967 six day war during which they took on most of the Arab world showed that although they were geographically small, they were tenacious fighters. But their successes on the battlefield are only accomplished in the role of the little brother on the elementary school playground. No one dares hit him back too hard lest the big brother pound the crap out of you. In this role, America, emboldens Israel and give them the gumption to fight all comers.

So even today, as this chapter of the PIC is being drafted, Israel and Lebanon are clinching once more over the posturing of capturing each other's soldiers and operatives to hold them as bargaining pawns. Meanwhile Israel bombs Beirut Airport and embargos their seaport for alleged "Acts of War" and Lebanon shoots missiles into the Port of Haifa alleging that Israel is committing "general acts of war." And the price of Crude climbs once again to record highs. But with America stretched very thinly, troops will not be forth coming in aid of the Israelis. The US must take care to not enflame any more of the smoldering Arab world. But as a self-righteous Israel exercises it right to defend itself in the manner it sees as fit, the remainder of the world sees yet another round of terrorism mounting and another hit on its economic base as fuel cost rise again. When I undertook to write this book and the manuscript was in its first draft, the price of crude was $42, (see the chapter on the Exxon Valdez in It's All Tuna!) During the second draft revision, it was hovering at about $120. As another benchmark, when George W. Bush assumed the Presidency, oil was trading at about $20.

The PIC clearly states that there is nothing in the long run that can be done to avoid the ultimate collapse, there are many courses of action that we can take to forestall the complete collapse and live to fight another day. So even while the oil producing world is disintegrating into political and religious chaos, the Western World fails to develop alternatives which will be viable when the lynchpin is pulled and the global economy comes crashing down around us.

Financial planners constantly remind us to diversify our portfolios to maximize the return while minimizing the overall risks. Even Stephen Hawking, the eminent physicist, has stated that humankind must migrate from this planet only, and colonize some other terra firma lest we become extinct in our one home. We must divide our eggs for two or more baskets. But the point here is that there is absolute certainty that petroleum is not going to last forever. Our collapse-causing mistake is in underestimating how soon that day will come.

Part two of that error is the assumption that the formula is linear. While pumping capacity may remain a constant, global demand is growing geometrically. We are still near the minimum point on the parabolic curve of consumption but the square function will quickly move us to a place on the curve where growth is far more rapid. While we can reliably predict the production numbers, and we can project the consumption demand, we cannot predict when a strategic disruption of distribution will takedown the critical percentage of the flow that makes the whole economic engine grind to a stop. We have seen in the first months of 2008 that Nigerian rebels have disrupted overland oil transport through Nigeria by bombing the pipelines four times. Each time they do so, the global price ratchets up a few percentage points.

We have seen how a critical relay can collapse the national electrical grid. We daily see how a simple motor vehicle collision can stop rush hour traffic dead on the road. We have seen how one man can stop a convoy of tanks by bravely standing in the path of the first one. One of the biggest contributors to imminent collapse is hubris. The belief that there is ample time to solve the problem is a fool's paradise. Likewise, one may be well justified in retaliating with all available resources, but will the outcome be more than was desired when the action was undertaken? One can fight fire with fire, but sometimes the fire turns into a conflagration beyond the control of the planners. This is the essence of the PIC.

The Bush Administration undertook to wage war in two tinderbox nations at a time when the entire region was itching for a reason to call to arms. As Karl Marx so clearly identified, the seeds of revolution are already in the people, all we need to do is ignite it. George Bush has lit the fire that has gotten out of hand and consumes a large portion of the Middle East and its environs. Newt Gringrich has connected the dots, as we are like to say in this post-911 world, and declared that we are now fighting World War III. Even though it is presently only his hope that we are fighting such a noble cause, it will not take much of an Easterly Wind to fan smoldering emotions into an all consuming flame. Economist, Milton Friedman, would be proud of this Republican Administration for its willingness to touch off the flames that eventually will burn out leaving fertile ground for the private-enterprise rebuilding of a major part of the world. The Corporati grin at the toppling of a wide swath of civilization like the tablets in the Domino Model where the pieces are well aligned and primed for the fall. Trouble arises when they get the pieces falling and they do not stop until far too many of them are down. Then it takes far too long to reset the field.

If everyone would mind their own business and sit out the worst of it, we could avoid the larger destruction that will follow if everyone gets into the act. It will be difficult for large powers to withhold their militaries when they see the possible loss of access to resources, such as China with Middle-Eastern Oil. Or the United State for the same Middle-eastern oil.

The idea of securing a piece of territory or political control over resources can be seen in the vying chronicles of the motives of the Soviets and the Allies during WWII. Russian high school level textbooks asserted to Russian children that "the USA delayed opening a second front against Germany until it was certain that the Russian Army would be victorious." We, it seems, only wanted to preserve a piece of Europe for ourselves. That sentiment is vastly similar to what we said about them, even though they were first attacked and invaded by Nazi divisions before the tide turned and Germany fell to Allied forces. Truth be told, each faction exacted its toll on the resources of Germany and together defeated them.

Israel's fight, although probably justified, could also lead to far wider fighting, of which they will be a minor player. Just as with the US and Iran and North Korea, we must be very careful to not bring all out warfare to those countries, even though we could. It would be very easy to lob a few bunker-busters into Pyongyang, while the world is watching Lebanon and the rest of the world duke it out a hemisphere away. It would be just one for "good measure." The US would not even have to follow through there. Just hit it and leave. Other nations already have such a longing with their long standing rivals.

The warring factions in Iraq all seek to control a larger portion of the geology it order to have a greater influence in the affairs of the country. Shia and Sunni and Kurd all seek to have access to a greater portion of the spoils. For them it is a war about oil too. No faction wants to be marginalized when it come to the division of revenues from the sale of petroleum. If it was solely for the establishment of freedom of religious practice, they could all agree to a partitioning of the nation into three geographic provinces where each would have sole governance.

But it is about oil, and there are huge thirsty nations all wanting to make sure that a friendly faction controls the fields and assures the delivery without disruption.

1 New York City units or equivalents. Each NYC Unit equals 7 Million people.
2 At least as produced from edible grains.
3 Principle of Imminent Collapse. States that everything in our world (the Universe) is on the edge of collapse and all it takes is a nudge to make it fail.
4 United States Population Equivalent = 292 Million or about 300 million in rounder numbers.

Warning: include(): open_basedir restriction in effect. File(d:/wwwroot/modalchoice/thepicstuff/genericomment.php) is not within the allowed path(s): (d:\wwwroot\hostyourdomain\modalchoice\modalchoice.com) in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 295 Warning: include(d:/wwwroot/modalchoice/thepicstuff/genericomment.php): failed to open stream: Operation not permitted in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 295 Warning: include(): Failed opening 'd:/wwwroot/modalchoice/thepicstuff/genericomment.php' for inclusion (include_path='.;C:\php\pear') in D:\wwwroot\hostyourdomain\modalchoice\modalchoice.com\www\thepicstuff\globalenergy.php on line 295

Name:
From:
Posted: 2008 16:21
Comment:
Name:
From:
Posted: 2008 16:21
Comment:
Name:
From:
Posted: 2008 16:21
Comment:
Name:
From:
Posted: 2008 16:21
Comment: