Oil is the foundation of
and is present throughout, the edifice of human civilization.
There are 10 calories of hydrocarbon energy– oil and natural gas–
in every calorie of food you and I eat in the industrialized world.
Fertilizers are made from natural gas.
Pesticides are made from oil.
You drive oil-powered machines to plant, plow,
irrigate, harvest, transport, package.
You wrap the food in plastic– that's oil. All plastic is oil.
There are 7 gallons of oil in every tire.
Oil is everywhere; it's ubiquitous. And it's only because of oil
that there are 7 billion people or almost
7 billion people on this planet right now.
The arrival of this cheap and easy energy
which is equivalent, by the way,
to billions of slaves working around the clock,
changed the world in such a radical way over the last century
and the population has gone up 10 times.
But by 2050, oil supply is able to support
less than half the present world's population
in their present way of life.
So, the scale of adjustment to live differently is just enormous.
The world is now using 6 barrels of oil for every barrel it finds.
Five years ago it was using 4 barrels of oil
for every barrel it finds.
A year from now it is going to be using 8 barrels of oil
for every barrel of oil it finds.
What's disturbing to me is the lack of any real effort
from governments worldwide
and industry leaders worldwide to do something different.
We have these, sort of, attempts to build more wind power
and to maybe do something with Tide...
we've got attempts to make our cars a little bit more efficient.
But there's nothing which really looks like a revolution coming along;
these are all pretty minor, and that I think is pretty frightening.
And the governments who are driven by these economists
who don't really appreciate what we're talking about
are trying to stimulate consumerism to restore past prosperity
in the hope that they can restore the past.
They're printing yet more money lacking any collateral at all.
So, if the economy improves and recovers
and the famous growth comes back, it will only be short-lived
because within a short period of time,
counted in months rather than years,
it will hit the supply barrier again;
there will be another price shock and a deeper recession.
So I think we go into a series of vicious circles.
So you have the economic growth going up
-price spike- everything shuts down. That's where we are now.
Then it starts to come up again but what we have now is this area
where there's no more ability to produce cheap energy.
We're at the peak- we're on the down slope of oil production.
No way you're going to get any more out of the ground any faster
which means that things shut down, the price of oil drops
which it did in early 2009 but then as you have a “recovery”
the price of oil starts to come back.
It's recently been hovering at about $80 a barrel
and what we see is that at even at $80 a barrel now,
with the financial and economic collapse,
people are having a hard time affording that.
World oil production right now is about 86 million barrels a day.
Over 10 years, you're looking at roughly 14 million barrels a day
having to be replaced.
There's nothing around which can come even
within 1% of meeting that sort of demand.
If we don't do something pretty quickly
there's going to be a huge energy deficiency.
I think the big mistake is in not recognizing a decade or so ago
that a concerted effort needed to be made
to develop these sustainable forms of energy.
I think that's something our grandchildren
will look back on with total disbelief.
'You people knew you were dealing with a finite commodity.
How could you possibly have build your economy
around something which was going to disappear?'