Friday Food for Thought #16

Finite World: Welcome to the 21st Century

Week 2, Month 11, Episode #16

Not too long ago I stumbled across a rather disturbing graph, which like many rather disturbing pieces of information sent me into a plethora of research, that eventually led to a number of conclusions.  Normally my short panic attacks are offset by information that makes the graph's information rather... well, inapplicable.

Not this time.

What graph did I see?  Well it was a projection of oil production which basically said that production would plateau at current levels until beginning to drop around 2020.  By 2050 production is projected to fall to roughly 2/3rds of current levels and drop to 1/3rd of current levels by 2070 or so.

Okay, so we're at the peak of oil production and we're probably pumping more out of the ground now than we ever will in the future.  What's that to panic about?

Well, oil demand is not a plateau like production.  The emerging economic juggernauts of the BRICS group (Brazil, Russia, India, China, and South Africa) have growing demands for oil, and while some of these nations have domestic supplies (Russia) or are heavily invested into alternate fuel sources (Brazil), most of these powers need oil to continue to grow.

Increased demand with current production levels results in higher prices, and historically small fluctuations in demand or production tend to result in significantly higher fluctuations for price.  In short the tap is running dry and there's more people waiting in line.

The driving force behind the BRICS group is the People's Republic of China, who sees further economic development as the key to future political stability.  The last time we had an emerging economic power dependent on oil facing reduced supplies, well... Japan attacked Pearl Harbor.

All of this isn't an immediate concern, but by 2030... well, it will be.  A very rough calculation I made came up with a price for a barrel of oil being around $600 by 2030.  If gas prices fell in line with that increase, we're talking about $20.00 a gallon for gasoline in fifteen years.  This will no doubt spur efforts to either increase production (ha! ha! ha!) or find means of stretching our resources to fill the gap between supply and demand.

Synthetic oils and gasoline can be produced from coal (this is very similar to Oil Sands in terms of how it's done), as the United States has a coal industry that likes to brag about their 75 or 100 year supply of coal in this country, it doesn't take a genius to figure out how we'll make up the gap between supply and demand here.  Unfortunately shifting demand from one hydrocarbon fuel to another will just mean that 75 or 100 year supply of coal isn't going to last that long.

Like the United States, China has vast coal reserves and will likely use them to compensate for the rising oil costs.  Russia will ride the oil wave enriching itself on it's own production of the more and more valuable fuel.  Brazil will likely double down on their ethanol production and use it to compensate for increased demand for oils.  South Africa is already investing in their own oil and coal supplies and will likely ride it out much as Russia will.  India will be faced with a crisis as their own demand rises, as they don't have the local supplies of other nations. 

Outside of BRICS, Japan will face problems as new hesistancy to utilize nuclear power will likely have them falling back on oil and natural gas as power sources, both of which will need to be imported and force Japan's already painful cost of living to skyrocket.  Most of Europe is dependent on natural gas for heating and power, and as vast as those global reserves are they're not inexhaustible.

Ultimately those measures will only extend so far, and by 2050 we'll likely be facing an energy crisis across most of the globe.  As the price of oil increases, so does the cost of shipping across the globe by conventional power (nuclear powered aircraft carriers and submarines can ignore this).  Increasing costs of trade cut deeply into the economics of all the powers as globalization begins to unravel.  In the largest countries it becomes prohibitively expensive to ship goods between states and provinces, throwing a wrench into the organization scheme of modern national and global chains.

The rising price of shipping will have painful consequences as nation after nation will be unable to afford to import food from the major producers of the world (the United States, Ukraine, and so forth being the major producers), faced with famine and starvation at home, nations will lash out against their neighbors hoping to obtain food or energy sources.  Global Hunger will dramatically reduce the population, as it becomes more and more impossible to supply the needs of far flung nations from those countries that produce major surpluses.

The 21st Century will be a century filled with conflict as demands for finite resources grow stronger.  The BRICS will challenge American dominance as they struggle over those resources.  When they finally dry up completely, our society will be looking at an extreme crisis looking for alternate means of supplying energy, creating plastics, transporting food and other goods.

Non-hydrocarbon fuel and energy sources will become the norm.  Aircraft design will revert to propeller systems as the cost of jet fuel overwhelms the air lines, and ultimately the use of small scale fission, hydrogen fuel-cell, or other nuclear propulsion systems will become commonplace on aircraft and ground vehicles.  It's possible that high efficiency ion engines could also be used for aircraft.  Solar power will see limited use as the average home requires around 150 square feet of solar panels to fill it's energy needs at 100% efficiency with no clouds and constant daylight.

It is likely that the development of a Hybrid Nuclear Fusion-Fission reactor will be pushed as a means of both eliminating Nuclear Waste from fission power (as it uses spent fuel rods from fission reactions as fuel) and the development of smaller fully contained and crash proof reactors will be heavily invested in, especially by Japan.

By 2100 I expect Earth's Economy to be vastly different then it is now.  The changes to society that the great squeeze of the oil crisis will wrought over the globe will likely dismantle most trade as we know it, and while they may be reestablished, it's likely that decentralized production will be the rule rather then the use of a factory in China to make toys for Toys 'R Us in New York.  At the same time technologies like 3d printing, robotics, and networking will replace a number of industries.  Much of the old social structure will be upended, as the move away from industry to decentralized manufacturing will leave the upper class holding the bag.  At the same time the unskilled laborer will find themselves without a real purpose as such work can most easily be accomplished by robots.

Trying to figure out how such a society would work is interesting... maybe I should write a book.