Tuesday, November 17, 2009

Chris Martenson: The Energy Cliff

Embedded below is a ten minute presentation on energy and the economy given by Chris Martenson, an independent economic analyst. His conclusion is that peak oil may or may not have arrived but cheap oil production, at least, has peaked, and thus cheap oil prices are now gone forever. He also talks about a very important concept called the energy cliff. I don't know where I stand on peak oil per se but Chris's logic in regards to an energy cliff and the end of cheap oil is tough to dispute.

Some highlighted quotes from the video:
  • The next 20 years are going to be completely different from the last 20 years
  • We have an economy that, by design, must grow
  • Economic growth cannot happen without growth in energy
  • US oil production peaked in 1970
  • Net energy is the ratio of energy extracted from any given source minus the energy required for extraction. Net energy has been decreasing for oil drilling over the last century and is quickly approaching an "energy cliff."
  • Prior to 1930, the net energy ratio was 100:1. In other words, 1 barrel of oil was required to extract 100 barrels. In 1970, this ratio fell to 25:1. In 1990 it hit somewhere around 18:1 and 10:1. We don't know where the ratio stands today.
  • We are past peak oil for conventional oil aka cheap oil
Watch the video:

I also highly recommend the Crash Course series of videos by Chris Martenson. You can view part one of the series here. Visit Chris Martenson's website here.
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