The oil crunch: coming sooner than you think
By Ted Trainer
The leading energy research organisation Petroconsultants has issued new estimates of remaining world oil supplies. It comes to more disturbing conclusions than previous reports, finding that world oil supply is likely to peak as soon as the year 2000. By 2025, it will probably be down to one third of the present volume.
The possibility that resource scarcity will have a devastating impact on the industrialised world was first given widespread attention by the publication of The Limits to Growth in the 1970s. Perhaps because it was a rather crude first venture into this field, restricted by limited data, it has had little or no impact on policy. Today almost all economists, governments, politicians and ordinary people have no doubt that the supreme national goal is and should be the ceaseless pursuit of higher material living standards, more consumption and limitless economic growth.
Anyway, if resources were getting scarce, wouldn't their prices be rising dramatically? The answer is no, not until demand exceeds supply. At present, the vast quantities of timber and oil and many other things the world economy wants can easily be provided, despite the fact that supplies are being rapidly depleted. You can buy tropical timbers at your local hardware fairly cheaply, but in the year 2030 they won't be on sale because by then there will probably be no tropical forest in good shape left anywhere.
For decades, most oil geologists have believed that the oil era would be over by about 2050. There have been more than 50 estimates of potential remaining oil resources — i.e., all the oil likely to be recovered, not just presently known reserves. These have settled around the average of 2000 billion barrels, with more than one-third already used.
World population is probably not going to stabilise before it reaches 11 billion. Now, how long would the remaining 1400 billion barrels last if 11 billion people each used as much oil as the average person in a rich country like Australia uses? The answer is only 12 years. In other words, there is not the slightest possibility of all the people we have now in the world, let alone all we will soon have, living in anything like the style people in rich countries take for granted.
The same conclusion is arrived at if you consider several other key resources. For example, it takes about 1.5 ha to provide a North American diet for one person. To provide it to 5.7 billion, the present world population, would therefore require 9.6 billion ha of land growing food. But all present crop land plus grazing land only add to about 4 billion ha, and are shrinking.
Since the publication of The Limits to Growth in 1972, much more confident estimates of many resource items have become available. That book did not discuss potentially recoverable resources, since the only evidence available was on known reserves. We can now see that if all people expected late next century used minerals as Australians do, then all of the potentially recoverable quantities of about one third of the basic minerals would be exhausted in around 30 years.
The age of severe scarcity is here; the problem is that people in rich countries do not experience it because they are the ones who are getting almost all of the scarce resources. They average 15-20 times the per capita consumption of oil, tin, coal and other minerals that the poorest 2.5 billion people on earth average. They can live like this because, in the global market, resources go to those who can pay most for them. One consequence is that about 600 million tonnes of grain, possibly one-third of all world production, are fed to animals in rich countries every year while 1 billion people are malnourished and one child dies from hunger every three seconds of the day.
The pro-growth advocates do not draw attention to the way resource demand will escalate in coming decades given normal growth rates. If the economy grows at only 3% per year, then by 2060 Australian living standards and total world output would be about 10 times as great as they are now. If the expected 11 billion people were by then all going to have the living standards we Australians would have by then, world economic output would literally be 80 times what it is today. Yet many scientists are saying that the present level of production and consumption is ecologically unsustainable.
So what should we do about our heavy dependence on oil and other resources? There is now a vigorous academic debate going on. The technical fix optimists and the economists argue there is no need to change our ways; better technology and the miracles of market forces will bring forth solutions that will enable us to go on consuming rampantly (20 tonnes of new materials every year for the average US citizen) and looking forward to higher living standards every year.
Opposed to them are those arguing that a sustainable society cannot be achieved while we remain committed to growth and affluence, and that in coming decades we must undertake a transition to a way of life that is much less affluent and based on highly self-sufficient local economies — and a steady-state or zero growth overall economy.
To the average economist, politician or consumer, this sounds like a totally unacceptable proposition. But there is now a global ecovillage movement pioneering the building of new settlements based on these principles. My books The Conserver Society and Towards a Sustainable Economy argue that the alternative way has all the ideas we need to guarantee a high quality of life to all people despite very low and sustainable rates of resource consumption.