The End of Oil

Paul Roberts

Just as oil and gas would outperform coal two centuries later, coal was simply superior to wood economically. First, the great abundance of coal made it much cheaper. Second, coal provided a better energy payoff: not only did it take less energy to dig out a pound of coal than to cut a pound of wood, but that pound of coal, when burned, released up to five times as much energy. Coal’s higher energy density made it far more economical to produce, cheaper to transport over long distance (from mines in the north to London in the south), and easier to store. Unlike a wood lot, which depends on a scattered and inefficient fuel-gathering process, a coalfield concentrates a massive volume of chemical energy more or less in one physical location. Production can be centralized and efficient, and therefore much more profitable --- a critical prerequisite to the birth of any industry, especially in a time when labor is scarce. (p. 27)

In 1908, less than seven years after Spindletop, Britain took the bold step of converting its entire navy from coal to oil powered ships. The intent was to gain an advantage over the coal fired navy of Germany, then girding for the first of two world wars. But the move was a huge gamble. Britain had plenty of coal but not a drop of oil domestically. By switching to oil, the English were making themselves dependent on a resource that was by definition undependable. “Security of supply” was no longer guaranteed. Britain would now need to protect access to Middle Eastern oil supplies, which meant keeping a navy in the Mediterranean (much as the United States keeps the Fifth Fleet there today). Henceforth, national security would be tied to the ability to maintain access to foreign oil.

In a remarkably short time, oil had moved to the very epicenter of geopolitics. … Driven by ravenous demand for oil, Western governments and their able assistants, the international oil companies, vied for control over the hapless oil states of Venezuela, Mexico, Sumatra, Borneo, and especially the Middle EAST, WHERE European and U.S. diplomats redraw the map to maximize access to oil. As one French diplomat declared during a period of particular frenzied boundary drawing, “He who owns the oil will own the world.”

Not every oil colony appreciated these new masters. Western “oil imperialism” --- by which we mean the collaborative effort between industrial governments and international oil companies to control the oil resources of various less advanced countries --- was igniting political fires around the globe that would smolder for decades. In 1938, a resentful Mexico went so far as to kick out Shell, Standard, and other Western oil companies and nationalize their assets. Oil executives, rightly afraid that this “socialist infection” would spread to other oil colonies, lobbied Washington to intervene militarily and make an example of Mexico. But Washington had other fish to fry. In a move that presaged its modern day appeasement of oil sheiks, Washington refrained from scolding the Mexicans for fear that Mexico might ally itself --- and, more important yet, its oil --- with Japan and Germany, then well along the path to another world war.

Inevitably, as oil became inseparably tied to diplomacy, it became inseparably linked with war as well. Not only did industrialized nations need oil to wage war (the modern army was now a “mechanized” force, with tanks, ships, and planes), but countries increasingly went to war for oil. This was especially true of the Second World War. Lacking domestic oil fields to fuel their industrial and military ambitions, both Nazi Germany and Imperial Japan faced a stark choice: curb those ambitions, or find oil elsewhere. Both chose the latter. In Germany, Adolph Hitler knew his only hope of victory lay in taking the oil fields of the Middle East and Russia (despite a pledge of loyalty to Stalin). In Tokyo, meanwhile, Hirohito’s vision of an Asian empire depended heavily on gaining control of the oil-rich East Indies. In fact, when the Japanese bombed Pearl harbor in December 1941, a primary objective was to sink any U.S. warships that might otherwise have prevented Japanese tankers from reaching Indonesia. (P. 39)

Worse, although the term “peak” suggests a neat curve with production rising slowly to the halfway point, then tapering off gradually to zero, in the real world, the landing will not be soft. As we approach the peak in production, soaring prices --- seventy, eighty, even a hundred dollars a barrel --- will encourage oil companies and oil states to scour the planet for oil. For a time, they will succeed, finding enough to keep production flat, stretching out the peak into a kind of plateau and perhaps temporarily easing fears. But in truth, this manic, postpeak production will simply deplete remaining reserves all the more quickly, thereby ensuring that the eventual decline is far steeper and far more sudden. As one U.S. geologist put it, “the edge of a plateau looks a lot like a cliff.” (P. 46)

Under normal conditions, C. reinhardtii, otherwise known as pond scum, behaves like other green plants, turning sunlight into sugar and oxygen via photosynthesis. When it finds itself in a dark, oxygen deprived environment, such as bottom of a pond, however, C. reinhardtii activates an emergency mechanism – an enzyme that generates a small ration of energy and, in the process, releases trace amount of hydrogen.

Scientists and energy companies have known about C. reinhardtii since the 1940s and, given hydrogen’s value as a potential fuel, have spent decades trying to induce the tiny plant to increase production --- to no avail. They hydrogen mechanism, it turns out, is only temporary: as soon as the enzyme generates any energy, the alga releases oxygen, which automatically shuts off the enzyme. For sixty years, biochemists have sought to harness C. reinhardtii’s hydrogen making powers with the same fervor with which alchemists once tried to transmute lead into gold --- and with the same frustrating results. (p. 188)