NYT Lets the Truth About Oil Slip, for a Second

(bumped by budhy – promoted by ek hornbeck)

Paragraph 25 of an article in tomorrow’s NYT:

OPEC’s 13 members plan to spend $150 billion to expand their capacity by five million barrels a day by 2012. But OPEC will need to pump 60 million barrels a day by 2030, up from around 36 million barrels a day today, to meet the projected growth in demand. Analysts say that without Iran and Iraq – where nearly 30 years of wars and sanctions have crippled oil production – reaching that level will be impossible.

This is why we are not going to leave Iraq.  The country that controls the future of Iraq and Iran, controls the world for the next 40 or so years.

The issue is not that Iraq and Iran might not be pumping oil in 2030.  One way or another, they will.  The issue is: which military power gets to hold the world at gunpoint in this final fossil-fuel thrill-ride to the edge?  Unless, that is, anyone thinks that the major military powers are going to let Iraq and Iran themselves hold that petrochemical pistol?

According to the New York Times article, world supply of oil is not increasing as it should, in accordance to standard laws of supply and demand, as prices rise to 118 dollars a barrel.  The reason is that supply is simply not available.  OPEC is building infrastructure to keep up, but it’s not enough.  OPEC controls 40% of the world’s current output.  The other 60% is not keeping pace, due to both dwindling fields and lack of pumping infrastructure.

An analyst describes non-OPEC supply as “dead in the water.”  

Some regions are simply running out of reserves. Norway’s production has slumped by 25 percent since its peak in 2001, and in Britain, output has dropped 43 percent in eight years. Production from the giant Prudhoe Bay field in Alaska has dropped by 65 percent from its peak two decades ago.

In many other places, the problems are not below ground, as energy executives like to put it, but above ground. Higher petroleum taxes and more costly licensing agreements, a scarcity of workers and swelling costs, as well as political wrangling and violence, are making it harder to raise production.

All of which is sobering informantion.  But the curious thing about the Times article is that it reports all this as if it were some sort of surprise to the world oil production community.  As if this information has not been known, and well know, for years, by those whose business it is know it.

But the International Energy Agency estimates that current investments will be insufficient to replace declining oil production. The energy agency said it would take $5.4 trillion by 2030 to raise global output. Otherwise, it warned that a crisis before 2015 involving “an abrupt run-up in prices” could not be ruled out.

Well, yes.

Which brings us back to that gun.  

Analysts say that without Iran and Iraq – where nearly 30 years of wars and sanctions have crippled oil production – reaching that level will be impossible.

Iraq and Iran hold the second and fourth largest oil reserves in the world, respectively, and it is possible that Iraq actually holds the largest.  Their reserves have not been needed up to now.  But it does not take a Kreskin to know that they will be needed in the first half of the 21st century.  It does not take a Kreskin, and it did not take a Kreskin in 2003, either, when the US invaded Iraq.

How do you control the 21st century?  You control Iraq and Iran.  It was nice of the NYT to say as much, even if it was in paragraph 25 of the article.

The situation is dire.  The future of the world, the extent to which humanity escapes the 21st century alive, depends to no small extent on the United States deciding it does not need to control the 21st century.  The question is not one of whether the United States will be merely dominant in the 21st century.  There are no reserves left to fuel a superpower in anything like the old paternalistic model.  There is not enough fuel for both the world’s policeman and the world’s citizens.  The question, rather, is one of whether or not the United States, in its desire to be dominant, will find it has no choice but to exclude, to starve, to bomb, to crush.  

The US can either accept that there is no room — and more importantly no time — left for a superpower, or else it can go on one last crusade.  One last globe-trotting, militaristic hurrah.  This one last time, should it come, will be — will have to be — unspeakable in its scope and ruin.

We can become citizens of the world, working together with the rest of the peoples of the world to solve a problem that can no longer be skirted.  Or we can have one final ride; thinking ourselves the world’s superpower, unassailable in our military superiority.  

Will our Presidential candidates address this?  Will Obama, will Clinton, address this?  Clinton has made her position more-or-less clear.  She would put the Middle East under a 21st century Monroe Doctrine — a nuclear “umbrella” purportedly to “protect” the Middle East from Iran; but in reality, to anyone who cares to notice, to signal to the world that the Middle East is ours as the reserves run out.  

Obama?  I honestly don’t know.  He may have the requisite courage and imagination to keep us out of an entirely foreseeable hell.  But then again he may not.  If he does, he may well become the single most important President in the history of the country.  Not just for the country, but for the world.

Or, he won’t.  In that case, the future is clear.  We will continue to pretend that “dominance” is needed for “security” . . . when in fact dreams of dominace in the twilight of the oil age guarentees the end of securtiy.  The United States will hold onto its dominance for as long as it can.  And that will last until, perhaps, 2040.  And then there will be nothing left but hell to pay.