Economy and climate on the path down from the peak of oil and gas

Later this year the world’s politicians will gather in Copenhagen to agree on measures to reduce global carbon dioxide emissions. In terms of future oil use our analyses show a forced decrease similar to what it is generally hoped they will agree on. For oil production, it is the forces of Nature itself (i.e. peak oil) that will put the politicians on the right track. No matter what they agree on for our future, it is reality that will set the agenda. Natural gas will also follow the same overall production pattern as oil so all that remains as a dark cloud over the future is coal. However, there is a solution for that which I will return to.

At the start of this essay I mentioned that we eat oil. Today, the food that we consume would never arrive on our table without oil. A study from the USA shows that every 1,000 kilocalories on our table require more than 5,000 kilocalories of oil and natural gas to get there. The rest of the world is not so far behind that, so let’s assume a factor of five. It means that 60 Mb/d of oil and natural gas is needed just to put food on all our tables, and that is more than 40 per cent of the total production of oil and gas. That requirement will grow with the increase in the world’s population.

This is the downside of the climate measures that will come out of the conference in Copenhagen. The world’s real problem is that too many people have too little energy to share. Many are convinced that the future use of coal will determine the outcome for the world’s climate. If we study the world’s coal reserves we find that 80 per cent exists in only six nations; the USA, Russia, China, India, Australia and South Africa. The greatest proportion of the coal that is consumed globally is in these six nations. It is incorrect to assert that carbon dioxide emissions from coal are an international problem. They are fundamentally a national problem. The international problem is that the rest of the world is affected by the emissions from these six nations.

A detailed study shows that the largest reserves of coal that can contribute to future emissions exist in two places. They are the state of Montana in the USA and Siberia in Russia. Russia does not require this coal for its own energy needs. For Montana, I have difficulty imagining that anyone who lives there would want to destroy its fantastic natural beauty by mining all its coal. In any case it would require a change to the American constitution to force through such a decision on mining. The best climate outcome that we could hope for from Copenhagen would be that Russia and the USA agree on a bilateral treaty whereby they decline to use half of their coal reserves.

In conclusion I would like, once again, to cite President Obama, “No single issue is as fundamental to our future as energy”.