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whistle imageAt last we know...sort of. An article in the UK newspaper The Guardian for November 9, titled “Key Oil Figures Were Distorted by US Pressure, Says Whistleblower,” reveals what hundreds of analysts have been trying to convey to world leaders for years: The global oil supply situation is critical and getting worse, and vested interests are playing key roles in covering up this devastatingly inconvenient truth.

Over a decade ago, when I began following the Peak Oil story, the main sources were a few highly-placed petroleum geologists with experience in oilfields around the globe. At that time, these brave scientists were saying that world oil production would peak sometime around 2010, and that the global economy would be hammered as a result. Since it will take decades to develop alternative energy sources to replace petroleum (if adequate replacements are even available), the consequences for transport, trade, and agriculture will be almost too awful to contemplate.

In the past few years these lone voices of warning have garnered the backing of a million-voice chorus: investment banks, oil analytics firms, and investigative journalists have joined the geologists in pointing out that oil production limits are within sight, and in calling for more transparency in official data reporting and forecasting.

But the International Energy Agency has stubbornly refused to come clean. And this is important: while financial analysts and investors are free to draw their own conclusions about Peak Oil (and a great many of them have seen the writing on the wall—hence recent run-ups in oil futures prices), national and local governments must rely on officially sanctioned fuel supply and price projections for all their planning. Energy policy, transport planning, agriculture policy, economic forecasting, and much more depend upon the august pronouncements of the Paris-based IEA.

There are always folks who are glad to tell us what we want to hear. Indeed, the presentation of plausible excuses for the denial of serious problems offers an attractive career track. Prominent oil optimists like Daniel Yergin and Michael C. Lynch find open doors at the New York Times and other major media outlets, and wealthy clients for their consulting services, because they reassure markets that all will be well.

Nevertheless, denial leads to complacency, not problem-solving. And the end of cheap, abundant oil is a problem that could cripple the global economy not just for another year or two, but more or less permanently.

This is not to say that the recently released IEA “World Energy Outlook 2009” is worthless: the current iteration of the agency’s annual report makes many excellent points (for example, that “Falling energy investment [resulting from the worldwide financial crisis] will have far-reaching consequences”). But, as the whistleblower quoted in the recent Guardian article notes, agency forecasts for future world oil production are still profoundly unrealistic:

Many inside the organisation believe that maintaining oil supplies at even 90 [million] to 95m barrels a day would be impossible but there are fears that panic could spread on the financial markets if the figures were brought down further. And the Americans fear the end of oil supremacy because it would threaten their power over access to oil resources.

Sooner or later, we must face reality. If we do it sooner, our chances of adapting successfully are far better than if we wait and deny just a little longer.

On one hand, careers are at stake if IEA officials step forward and tell us the truth. On the other hand, the global economy is as risk if they don’t.

There is evidently a quiet battle raging within the agency, and within the consciences of many of its officials. So far, we are all the losers in that battle.


Richard Heinberg is Senior Fellow of the Post Carbon Institute and author of The Party's Over: Oil, War and the Fate of Industrial Societies.

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6 comments

TEOTWAWKI

From: James R. Martin, Nov 24, 2009 11:38 AM

Here we are at the end of the world as we've known it--the long predicted end of economic growth, and yet our city councils, our mayors, our governors, our county commissioners, our journalists, our educators..., we're all either in the dark or we have to pretend we are -- to avoid looking kooky.

And yet this is the crucial moment when we have to keep it together when the next big snapping sound happens and social cohesion gets a serious test. So where are the folks creating and putting in place a bit of resiliency in the form of a bridge toward possible future efforts of creating resiliency? In other words, what's the emergency contingency plan? I fear that the world's hope for transitioning could plummet into chaos rather than planned, intelligent, organized response.

The Future of an Illusion

From: Javier, Nov 16, 2009 11:47 PM

Agree with John Mack's comment (Illusion). The Market Economy is in fact a religion, based on the worship of the Market, and the myth of Economic Growth. This religion has its own god: The Market Almighty. Marx called it "The fetishism of commodities". The early christians already regarded the worship of money as a form of idolatry, since the value of the money relies is only in the believer's faith: "You Cannot Serve God and Money" (Mt 6:24). In fact, all the financial crisis are just crisis of faith. That's why the prophets of capitalism keep telling us that the market itself will solve all the problems. The religion of the Market Economy has it's own Messiah: Technology, who is supposed to save us from the imminent economic and environmental collapse.

Facts

From: KP, Nov 15, 2009 12:42 AM

Better to bring out the facts and let the chips fall where they may. A catabolic collapse at least allows us to start over while there are still some resources left with which to start over.

Pemission for reprint

From: Innocent Byproduct, Nov 12, 2009 08:17 AM

Thank you for such an insightful and timely article.

Meanwhile, I am interested in re-posting significant portions of this blog post on a message forum elsewhere on the web (with a proper link-back to this page). Would you be willing to give such permission?

Thanks for your time,

--IB

illusion

From: John Mack, Nov 11, 2009 08:48 PM

Karl Marx said "Religion is the opium of the people." More generally, it can be said Faith is the opium of people, whether it's a Faith in a God or Gods, in the Stars, or in material progress. People need to believe in SOMETHING that transcends their own existence and offers the possibility of improvement. In the Middle Ages, faith was placed in religion. But as the Renaissance and the Industrial Revolution brought about increasing material prosperity, people adopted a new Faith in technological progress and gradually discarded the older one in religion. And this new Faith has proved to be far more rewarding and predictable than the previous one. It is this Faith in technological progress that is preventing people from seeing Peak Oil and its consequences. With Peak Oil, people will need a new Faith.

The CAN DO President ?

From: Dean Robertson, Nov 11, 2009 10:44 AM

Richard,

I know you have written an Open Letter to the President, Barack Obama, but have you been able to speak with him directly ?

The White House Website, has Contact ability, but when one uses it, there IS NO REPLY, ... just written comment, about the thousands of such communications each day, ... so they just IGNORE the people.

They seem to believe that their -tech no crap- view of the Solutions is good enough, so we can keep ALL of our Stuff, our houses ETC.

If we cannot get Obama to STAND UP and DO THE RIGHT THINGS, ... well, we will have to do it ourselves.

The big problem is our USELESS MONETARY SYSTEM, and ALL of the ramifications that it FORCES people to do, ... and our USELESS GOVERNMENT, the " Congress ", House and Senate, that has members that VOTE ... STUPIDLY because THEY WANT TO BE RE-ELECTED, .. Like the Healthcare Bill, or the coming Energy and Climate Bill, the Copenhagen Event, and the Senate AGAIN, ... these people are INSANE.

Someone has GOT TO get to the PRESIDENT, and tell him the FACTS, and THE SOLUTIONS, ... Steven Chu has shown me NOTHING but -tech no crap-, and Vice President, ... housing retrofit BS.

The ( short term ) MENTALITY of these people IS SCARY, we should be PLANNING for the NEXT THOUSAND YEARS, not the next fiscal quarter, or the number of people NOT working and looking for work.

There is no reason why we can not put everyone to work BUILDING the Thousand Year Future.