The world is heading full steam ahead towards the ENERGY CLIFF, and virtually no one seems to be prepared. After watching the U.S. Presidential Election and the circus sideshow that followed on both Mainstream media outlets, I am quite surprised how much Americans have invested their time, energy, and emotion in either political party when the world is getting ready to enter a GLOBAL DEPRESSION the likes of which we never recover.
Sure, I imagine I will upset a few people with that remark, but those are the FACTS. Of course, we can hem-&-haw about the ENERGY CLIFF’s exact timing, but in the end, it doesn’t really matter if we are off by a few years… DOES IT? Gosh, it has been 11 years since the 2008-2009 Global Financial Crisis. How fast did that go by??
Well, I will tell you how fast it went by… the world enjoyed a net increase of 12 million barrels per day of OIL, NGLS, and CONDENSATE production from the U.S. Shale oil industry. We can thank the very unprofitable U.S. Shale Industry for basically propping up the entire global economy for the past decade. We must remember the simple fact; oil production growth allows GDP growth… PERIOD.
While many shale investors were taken to the cleaners, they were sacrificed to the GREAT PONZI SCHEME GODS to allow business, as usual, to continue a bit longer. So, if you come across any investors with a sad face after investing in the Shale Biz, you should give them a big THUMBS UP as they allowed the U.S. Suburban Leech & Spend Economy to go on for another decade.
All kidding aside, the U.S. and world face a very DARK REALITY, which few are prepared for. Unfortunately, when you turn on the TELLY, we don’t see any warning signs of the coming ENERGY CLIFF; rather, we see a lot of Americans yelling or screaming about a WIN or LOSE for their Presidential candidate. I can assure you that within the next 5-10 years, there won’t be much a President can do to prepare us for what’s coming.
Today, Gail Tverberg of OurFiniteWorld.com put out a new article and an EYE-OPENING chart, Energy Is the Economy; Shrinkage in Energy Supply Leads to Conflict.
The shape of this curve is far different from the one most forecasters expect because they assume that prices will eventually rise high enough so all of the fossil fuels that can be technically extracted will, in fact, be extracted. I expect that oil and other fossil fuel prices will remain too low, for reasons I discuss in Section [4], below. In fact, I have written about this issue in a peer reviewed academic article, published in the journal Energy.
I have had a few email exchanges with Gail in the past. Some may have been in disagreement with Dr. Louis Arnoux and the Hills Group work on the Thermodynamics of Oil Depletion. However, if we compare Dr. Arnoux’s most recent chart, which I used as a title in our newest Youtube Video interview Thermodynamic Oil Collapse & Future, you will notice a very eerily similar resemblance.
You see, Dr. Arnoux gets the credit for the term, THE MOTHER OF ALL SENECA EFFECTS. I just replaced “Effects” with “Cliff.” I like Cliff… sounds better.
It is interesting to see Gail Tverberg publish such a dramatic chart on future energy production-consumption. Gail is by no means one of the Alt-Media’s “Grand Conspiracy Afficiandos.” Oh, no.. she is by professional trade, a casualty actuary working in insurance industry forecasting. That is about as BORING of a job as it gets, nothing personal. So, when Gail publishes a chart that shows the END OF THE WORLD as we know it, people should take notice.
But of course, they won’t. Rather, during many family and friend get-togethers, Americans will have to listen to the subtle ways of how we should hate TRUMP or BIDEN. Because you know… TRUMP hasn’t done one GOOD thing or has (& will) BIDEN. Or TRUMP is the best thing since sliced bread… or so is BIDEN. It’s either one or the other. It seems that the American way of life today… you have to LOVE one and HATE the other.
So… as we head closer to the ENERGY CLIFF, we will do so by hating each other every step of the way. Thus, I don’t see a viable solution to the Energy Cliff, such as the one proposed by Dr. Arnoux’s nGeni, because we are just TOO STUPID and GREEDY to set aside our egos to work together… as the human race should.
With all that being said… if you are going to be a part of the world as the ENERGY CLIFF moves into high hear, it’s probably best to move a good percentage of your investments into physical GOLD & SILVER. While there is no guarantee on the future values or prices of the precious metals, I can assure you; they will provide MUCH BETTER OPTIONS than soon to be defunct 401ks, Pension Plans, IRAs, Treasuries, Bonds, most Stocks, and Real Estate.
The world is heading into a new paradigm of PROTECTING WEALTH, as building wealth will become impossible to do for most individuals, even the wealthy.
Lastly, I have another ENERGY CLIFF article to come out later in the week…
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What kind of impact will energy cliff have on housing markets?
Due to the current pandemic (and riots), people are moving into suburbs and rural areas. This kind of life style needs more energy.
As energy supply becomes more limited, will people move back to cities?
Is it still probable that EV will solve our transportation problems (doubtful)? It still needs lot of energy to rebuild and maintain roads, bridges etc.
Is it a good idea now to buy housing in near suburbs with some public transportation to city centers? It would be a balance between energy needs and life style.
JLS,
After years of reflection on the coming ENERGY CLIFF, it seems to me that the best place to be is in the country, not the BIG CITY or SUBURBS. The Big City will be the worst because there are so many people in such a small area. However, the suburbs won’t fare much better in time.
Thus, a modest home in the country on a bit of land will be one of the best places to survive the coming ENERGY CLIFF.
steve
I’ll second that — cities are huge energy sinks (h/t Kunstler).
I’d also note that energy relates directly to population as well (h/t Heinberg). The number of humans will decline in concert with oil, one way or another (most of them ugly).
And no, there are currently no forms of “green energy” that’ll fix that. The nonsense about “solar getting cheap” ignores the fact that lacking the coal/oil/NG “subsidy” solar either doesn’t exist or is simply not viable.
Wow, now that I’ve gotten into the article I see that Tverberg goes right to the population argument!
With more people acting on the same idea, rural property values will likely escalate. Money may top handing the property down to family members following a death.
I don’t know if it will be possible to purchase or build a modest-priced house.
I certainly wouldn’t build in areas where fracking occurred.
As an alternative to “the country”, there are small towns to consider. Our 2nd home we sold to my now elderly mother; she has the money to maintain it.
It is in a small valley town surrounded by mountains. There is one road in and the same road out, i.e. not what thieves like. Lot’s of retired or working remotely people to watching neighbors’ home. And where we are most have a firearm to defend their home.
In a small town there is often a small hospital…and you never know when you might need medical help.
There is abundant country around there; I refer small town.
Living in the country looks good. However, the power grid in US is so old that it needs constant repair. In case of an economic collapse due to energy or else, there could potentially be more power supply issue in the country. The roads and bridges leading to cities may not be there.
I get the point: independence as much as possible from the system, and stay away from crowed places.
Yes, get small, get off grid, get into a Peak Prosperity-style resilience community.
Is the basic premise behind the energy cliff diminishing returns?
Relocating from outside of Phoenix to Everton Missouri at the end of the month. It’ll be alright brother!
Well, good move. I’m at the south end of the Ozarks in Ar. What to invest in? Snap up all the used ax heads, hammerheads, chisels, etc you run into. Any older American, European hand tools are becoming dang valuable in these times. I really think quality hand tools and a good supply of all types of fasteners are a good investment. When you get moved, cut down a Hickory tree to dry for handles. Then roast a turkey or deer over some of that Hickory. OH Man!!
Steve. In the barrel diagram – I don’t quite understand the BLUE part of the equation, that is called “the unavoidable waste heat,” or as it is also referred to as “the second principle of thermodynamics,” … that which is lost, which makes up about one-third of the barrel of oil.
Can you help me understand how that works? It sounds like you’re saying that one-third of a barrel is used inefficiently so it’s not counted?
Or how is that different than saying – when I burn 1 gallon of gas in my car, one-third of that gallon is not counted because heat escapes my engine?
Steve, ironically, “a modest home in the country on a bit of land” (which is also my dream and plan as my ultimate place to live) could be well served by solar panels, should the energy grid fail.
The location must be in a sunny place, of course.
EVERYBODY IS CRAZY OVER EVs AND HOW THEY SAVE THE ENVIRONMENT. DO THEY NOT REALIZE THAT THE ELECTRICITY NEEDED TO RECHARGE THEIR BATTERIES COMES FROM BURNING FOSSIL FUELS?
Richard, Obviously, their brains do not function as ours…. no reasoning ability….. I know many like that. I just don’t say anything at all anymore to those when I am around them. I read many comments daily, on various sites, about us not needing any oil soon, as EV will take over.
I respectfully disagree with your article and your argument. The elites want us to blame the great crash on any boogeyman, in this case oil, and not them. They have caused the chaos with their debt based money. They have for many years wanted to cull the population of the earth. But they push junk science like global warming and peak oil, as to justify their agendas, and as a scapegoat for the ultimate collapse which will be caused by them and their confetti money. I just did a search and it says that the average price for gasoline in Venezuela from 2018 to 2020 was 1 cent per liter (about 4 cents per gallon)! The only energy crisis in my life was the man-made Arab oil crisis in the 1970’s, Other than that, there has never been an energy shortage in the last 50 years. NEVER! But let’s put the blame on God for not producing enough energy for earth to function, or on humanity for depleting the earth’s resources, not on the parasitic bankers and the elite, who cause endless wars and chaos around the world. This isn’t a criticism of the author, just my take on how the elites try to shape opinions and theories regarding important topics in the world today.
Marvin,
We appreciate your reply. However, I respectfully disagree. But, you are free to your opinion. Let’s compare NOTES in 5-10 years.
steve
Damn those elites are awesome. They have been at it, conspiring for centuries, just letting us do our thing and balloon our numbers to almost 8 billion. And now, finally, all their plans are coming to fruition.
But here is the upside. Once the non-existent problems with energy hit you in your face, you won’t have time to follow all the conspiracies as you won’t have the internet and you’ll have enough to do to put some food on your plate.
As a geologist, and reader of history, and owner of a small-holding with 200 year old cob cottage & water well on the south coast of England ( = ideal small farm), unless the majority of UK population is killed off very quickly (even Gail’s global 5 billion dead by 2050 leaves too many), I honestly don’t believe that more than a few 100’s will survive in the UK. The reason being, the lack of available biomass fuel to cook food and provide warmth.
Even in the 1850’s there was a shortage of fuel, which was the driver to push many to emigrate to North America, and the population then was only 18 million.
I think it would be possible to grow the food, but that there would be no fuel to cook it.
PS I agree with your assessment that the cliff is imminent, brought forward by about 5-10 years as an after-effect of Corona. Art Berman says US unconventional oil with come back online at 1/3 of what is was pre-Corona, about 4 million barrels/day rather than 12 mmbd.