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Image | Nate Hagens: We’re Not Facing a Shortage of Energy, But a Longage of Expectations
Nate Hagens: We’re Not Facing a Shortage of Energy, But a Longage of Expectations
by Adam Taggart

 

This week's interview is one of the most important discussions we've had to date on energy, its supply/demand dynamics, and the tremendous impact it has on our economic and social identity. It is clear now that we are staring at a future of declining output at a time when the world is demanding an ever-increasing amount. 

Nate Hagens, former editor of the respected energy blog, The Oil Drum, gives a fact-packed update on where we are on the Peak Oil timeline. But interestingly, he explains how he sees the core issue as less about the actual amount of energy available to the world and more about our assumptions about how much we really need:

"We’re not really facing a shortage of energy; we’re facing a longage of expectations. And the sooner that we as individuals or a nation recognize that the future is going to see much lower consumption than today and prepare for that, psychological resilience is going to be really important, because if no one is psychologically prepared, people are going to freak out when some of these freedoms start to go away.

 

Nate Hagens: We’re Not Facing a Shortage of Energy, But a Longage of Expectations
 by Adam Taggart

 

This week's interview is one of the most important discussions we've had to date on energy, its supply/demand dynamics, and the tremendous impact it has on our economic and social identity. It is clear now that we are staring at a future of declining output at a time when the world is demanding an ever-increasing amount. 

Nate Hagens, former editor of the respected energy blog, The Oil Drum, gives a fact-packed update on where we are on the Peak Oil timeline. But interestingly, he explains how he sees the core issue as less about the actual amount of energy available to the world and more about our assumptions about how much we really need:

"We’re not really facing a shortage of energy; we’re facing a longage of expectations. And the sooner that we as individuals or a nation recognize that the future is going to see much lower consumption than today and prepare for that, psychological resilience is going to be really important, because if no one is psychologically prepared, people are going to freak out when some of these freedoms start to go away.

 

Image | Exclusive Arnie Gundersen Interview: The Dangers of Fukushima Are Worse and Longer-Lived Than We Think
Exclusive Arnie Gundersen Interview: The Dangers of Fukushima Are Worse and Longer-Lived Than We Think
by Chris Martenson

"I have said it's worse than Chernobyl and I’ll stand by that. There was an enormous amount of radiation given out in the first two to three weeks of the event. And add the wind blowing in-land. It could very well have brought the nation of Japan to its knees. I mean, there is so much contamination that luckily wound up in the Pacific Ocean as compared to across the nation of Japan – it could have cut Japan in half. But now the winds have turned, so they are heading to the south toward Tokyo and now my concern and my advice to friends that if there is a severe aftershock and the Unit 4 building collapses, leave. We are well beyond where any science has ever gone at that point and nuclear fuel lying on the ground and getting hot is not a condition that anyone has ever analyzed."

So cautions Arnie Gundersen, widely-regarded to be the best nuclear analyst covering Japan's Fukushima disaster. The situation on the ground at the crippled reactors remains precarious and at a minimum it will be years before it can be hoped to be truly contained. In the near term, the reactors remain particularly vulnerable to sizable aftershocks, which still have decent probability of occuring. On top of this is a growing threat of 'hot particle' contamination risk to more populated areas as weather patterns shift with the typhoon season and groundwater seepage.

In Part 1 of this interview, Chris and Arnie recap the damage wrought to Fukushima's reactors by the tsunami, the steps TEPCO is taking to address it, and the biggest operational risks that remain at this time. In Part 2, they dive into the health risks still posed by the situation there and what individuals should do (including those on the US west coast) if it worsens.

Click the play button below to listen to Part 1 of Chris' interview with Arnie Gundersen (runtime 36m:31s):

[swf file="http://media.PeakProsperity.com/audio/arnie-gundersen-2011-06-03-part1.mp3"]

Download/Play the Podcast
Report a Problem Playing the Podcast

Or start reading the transcript below:

Exclusive Arnie Gundersen Interview: The Dangers of Fukushima Are Worse and Longer-Lived Than We Think
 by Chris Martenson

"I have said it's worse than Chernobyl and I’ll stand by that. There was an enormous amount of radiation given out in the first two to three weeks of the event. And add the wind blowing in-land. It could very well have brought the nation of Japan to its knees. I mean, there is so much contamination that luckily wound up in the Pacific Ocean as compared to across the nation of Japan – it could have cut Japan in half. But now the winds have turned, so they are heading to the south toward Tokyo and now my concern and my advice to friends that if there is a severe aftershock and the Unit 4 building collapses, leave. We are well beyond where any science has ever gone at that point and nuclear fuel lying on the ground and getting hot is not a condition that anyone has ever analyzed."

So cautions Arnie Gundersen, widely-regarded to be the best nuclear analyst covering Japan's Fukushima disaster. The situation on the ground at the crippled reactors remains precarious and at a minimum it will be years before it can be hoped to be truly contained. In the near term, the reactors remain particularly vulnerable to sizable aftershocks, which still have decent probability of occuring. On top of this is a growing threat of 'hot particle' contamination risk to more populated areas as weather patterns shift with the typhoon season and groundwater seepage.

In Part 1 of this interview, Chris and Arnie recap the damage wrought to Fukushima's reactors by the tsunami, the steps TEPCO is taking to address it, and the biggest operational risks that remain at this time. In Part 2, they dive into the health risks still posed by the situation there and what individuals should do (including those on the US west coast) if it worsens.

Click the play button below to listen to Part 1 of Chris' interview with Arnie Gundersen (runtime 36m:31s):

[swf file="http://media.PeakProsperity.com/audio/arnie-gundersen-2011-06-03-part1.mp3"]

Download/Play the Podcast
Report a Problem Playing the Podcast

Or start reading the transcript below:

Image | How To Position For The Next Oil Shock
How To Position For The Next Oil Shock
 PREVIEW
by Chris Martenson

How To Position For The Next Oil Shock

Friday, May 27, 2011

Executive Summary

  • Saudi Arabia’s reserve capacity is a myth
  • World oil demand is increasingly overwhelming supply
  • Why exports matter more than total world production
  • What the next oil shock will do to stock, bonds, commodities, precious metals, and real estate
  • What you should do to prepare

Part I: Past Peak Oil – Why Time Is Now Short

If you have not yet read Part I, available free to all readers, please click here to read it first.

Part II: How To Position For The Next Oil Shock

Putting It All Together

Let’s review the situation in the KSA:

  1. Despite assurances of 12.5 mbd of total capacity, the KSA has not yet produced more than 9 mbd on a sustained basis in 2011.
  2. The IEA is begging the KSA to pump more.
  3. The KSA has turned to outside companies to help it begin to unlock heavy oil reserves that will take a lot of time, energy, and money to prosecute.
  4. The KSA has a vastly expanded rig count as they expand drilling operations to produce more oil (odd behavior for a nation with an alleged 3.5 mbd of spare capacity?).

The simplest and therefore most likely explanation for all of this is that the KSA does not actually have 12.5 mbd of total capacity, it is already at peak, and it’s now struggling to maintain even 9 mbd of total output on a limited basis.

Of course, there are other possibilities, but since those will not shake the world to its bones if they happen to be true, the safe course of action here is to go with the ‘KSA is at peak’ story.  Sooner or later it will be true, so there’s not a lot of harm in being early to it, while being late could be costly.

Now let’s move onto the last part of this puzzle: demand.

How To Position For The Next Oil Shock
 PREVIEW by Chris Martenson

How To Position For The Next Oil Shock

Friday, May 27, 2011

Executive Summary

  • Saudi Arabia’s reserve capacity is a myth
  • World oil demand is increasingly overwhelming supply
  • Why exports matter more than total world production
  • What the next oil shock will do to stock, bonds, commodities, precious metals, and real estate
  • What you should do to prepare

Part I: Past Peak Oil – Why Time Is Now Short

If you have not yet read Part I, available free to all readers, please click here to read it first.

Part II: How To Position For The Next Oil Shock

Putting It All Together

Let’s review the situation in the KSA:

  1. Despite assurances of 12.5 mbd of total capacity, the KSA has not yet produced more than 9 mbd on a sustained basis in 2011.
  2. The IEA is begging the KSA to pump more.
  3. The KSA has turned to outside companies to help it begin to unlock heavy oil reserves that will take a lot of time, energy, and money to prosecute.
  4. The KSA has a vastly expanded rig count as they expand drilling operations to produce more oil (odd behavior for a nation with an alleged 3.5 mbd of spare capacity?).

The simplest and therefore most likely explanation for all of this is that the KSA does not actually have 12.5 mbd of total capacity, it is already at peak, and it’s now struggling to maintain even 9 mbd of total output on a limited basis.

Of course, there are other possibilities, but since those will not shake the world to its bones if they happen to be true, the safe course of action here is to go with the ‘KSA is at peak’ story.  Sooner or later it will be true, so there’s not a lot of harm in being early to it, while being late could be costly.

Now let’s move onto the last part of this puzzle: demand.

Image | Past Peak Oil – Why Time Is Now Short
Past Peak Oil – Why Time Is Now Short
by Chris Martenson

Note:  With so much going on with Europe's debt crisis, the continuing disaster and economic contraction in Japan, and the potential for a very hard landing in the Chinese growth miracle (which is in the running as my favorite "black swan candidate" for 2011), I am going to return our attention to oil in this report.  The next report will assess the developing and unfolding debt crisis that will drag down most of the developed economies at some point, and this report will provide essential context for understanding why this result is inevitable and when it will occur.

The Next Oil Shock

The only thing that could prevent another oil shock from happening before the end of 2012 would be another major economic contraction.  The emerging oil data continues to tell a tale of ever-tightening supplies that will soon be exceeded by rising global demand.  This time, we will not be able to blame speculators for the steep prices we experience; instead, we will have nothing to blame but geology.

 
Past Peak Oil – Why Time Is Now Short
 by Chris Martenson

Note:  With so much going on with Europe's debt crisis, the continuing disaster and economic contraction in Japan, and the potential for a very hard landing in the Chinese growth miracle (which is in the running as my favorite "black swan candidate" for 2011), I am going to return our attention to oil in this report.  The next report will assess the developing and unfolding debt crisis that will drag down most of the developed economies at some point, and this report will provide essential context for understanding why this result is inevitable and when it will occur.

The Next Oil Shock

The only thing that could prevent another oil shock from happening before the end of 2012 would be another major economic contraction.  The emerging oil data continues to tell a tale of ever-tightening supplies that will soon be exceeded by rising global demand.  This time, we will not be able to blame speculators for the steep prices we experience; instead, we will have nothing to blame but geology.

 
Wood Gasification: An Intriguing Emergency Fuel Source
by Dutch John
src=A personal note

As a daily visitor of ChrisMartenson.com, I first want to thank Dr. Chris, his staff and all members for the excellent job achieved in this community. I value the high quality articles backed by data and the informative member comments that are pleasant to read. All of you keep me on track. Up until I found Chris, his Crash Course and articles three years ago, I often was very unsure about my feelings, thoughts and fears about the future. Of course I still expect a different future, but knowing I’m not alone in making preparations and gathering knowledge and skills increases my personal resilience.

Like many members of the “Martenson Brigade” I am becoming less dependent on fossil fuel, high living standards and money. I gave up a very nice income ten years ago to move towards greater self-sufficiency. Investing in home gardening, livestock, solar, wind and biomass energy has made my life more simple, slow and sweet. Yes, I am a big fan of John Seymour. No rat race for me and my wife anymore. Unfortunately, community building is still tough since the local farmers here in the Netherlands have no idea what the world is turning into and I do not live in a city where contrarian thinkers are easier to find. Likewise thinkers are scattered all over the country.

After these three years of absorbing knowledge, I feel payback time has come. As it happens I know a little more about wood gasification compared to the average person.
Wood Gasification: An Intriguing Emergency Fuel Source
 by Dutch John
src=A personal note

As a daily visitor of ChrisMartenson.com, I first want to thank Dr. Chris, his staff and all members for the excellent job achieved in this community. I value the high quality articles backed by data and the informative member comments that are pleasant to read. All of you keep me on track. Up until I found Chris, his Crash Course and articles three years ago, I often was very unsure about my feelings, thoughts and fears about the future. Of course I still expect a different future, but knowing I’m not alone in making preparations and gathering knowledge and skills increases my personal resilience.

Like many members of the “Martenson Brigade” I am becoming less dependent on fossil fuel, high living standards and money. I gave up a very nice income ten years ago to move towards greater self-sufficiency. Investing in home gardening, livestock, solar, wind and biomass energy has made my life more simple, slow and sweet. Yes, I am a big fan of John Seymour. No rat race for me and my wife anymore. Unfortunately, community building is still tough since the local farmers here in the Netherlands have no idea what the world is turning into and I do not live in a city where contrarian thinkers are easier to find. Likewise thinkers are scattered all over the country.

After these three years of absorbing knowledge, I feel payback time has come. As it happens I know a little more about wood gasification compared to the average person.
The Case for Small Scale Biofuels (or, Can you produce your own liquid energy slaves?)
by Ready

align=You might say that I am a bit of an unconventional thinker. I generally take a different approach to things than what most people do, given the same stimulus. I believe I am in good company in that regard here at ChrisMartenson.com. I clearly understand the controversy over employing biofuels as one method to prepare for the coming storm. Let me say right up front that I do not believe biofuels will allow our existing civilization to sustain its current high net energy lifestyle by substituting biofuels for oil. My argument for the application of biofuels is at a much more personal/community level. I have been asked repeatedly about what and why I am doing this, so I am posting this as a service to the ChrisMartenson.com members who have questions that may not have been answered yet.

It was in 2006 that I first learned of Peak Oil. That topic is what eventually lead me to Dr. Martenson, who put things in a broader perspective for me. However, as the Three E’s go, it is clear that Energy has been my primary play, since it is what started me down my current path.
The Case for Small Scale Biofuels (or, Can you produce your own liquid energy slaves?)
 by Ready

align=You might say that I am a bit of an unconventional thinker. I generally take a different approach to things than what most people do, given the same stimulus. I believe I am in good company in that regard here at ChrisMartenson.com. I clearly understand the controversy over employing biofuels as one method to prepare for the coming storm. Let me say right up front that I do not believe biofuels will allow our existing civilization to sustain its current high net energy lifestyle by substituting biofuels for oil. My argument for the application of biofuels is at a much more personal/community level. I have been asked repeatedly about what and why I am doing this, so I am posting this as a service to the ChrisMartenson.com members who have questions that may not have been answered yet.

It was in 2006 that I first learned of Peak Oil. That topic is what eventually lead me to Dr. Martenson, who put things in a broader perspective for me. However, as the Three E’s go, it is clear that Energy has been my primary play, since it is what started me down my current path.
Image | The Case for Small Scale Biofuels
The Case for Small Scale Biofuels
by Ready

You might say that I am a bit of an unconventional thinker. I generally take a different approach to things than what most people do, given the same stimulus. I believe I am in good company in that regard here at PeakProsperity.com. I clearly understand the controversy over employing biofuels as one method to prepare for the coming storm. Let me say right up front that I do not believe biofuels will allow our existing civilization to sustain its current high net energy lifestyle by substituting biofuels for oil. My argument for the application of biofuels is at a much more personal/community level. I have been asked repeatedly about what and why I am doing this, so I am posting this as a service to the PeakProsperity.com members who have questions that may not have been answered yet.

It was in 2006 that I first learned of Peak Oil. That topic is what eventually lead me to Dr. Martenson, who put things in a broader perspective for me. However, as the Three E’s go, it is clear that Energy has been my primary play, since it is what started me down my current path.
The Case for Small Scale Biofuels
 by Ready

You might say that I am a bit of an unconventional thinker. I generally take a different approach to things than what most people do, given the same stimulus. I believe I am in good company in that regard here at PeakProsperity.com. I clearly understand the controversy over employing biofuels as one method to prepare for the coming storm. Let me say right up front that I do not believe biofuels will allow our existing civilization to sustain its current high net energy lifestyle by substituting biofuels for oil. My argument for the application of biofuels is at a much more personal/community level. I have been asked repeatedly about what and why I am doing this, so I am posting this as a service to the PeakProsperity.com members who have questions that may not have been answered yet.

It was in 2006 that I first learned of Peak Oil. That topic is what eventually lead me to Dr. Martenson, who put things in a broader perspective for me. However, as the Three E’s go, it is clear that Energy has been my primary play, since it is what started me down my current path.
Image | Robert McFarlane: Open Fuel Standards Are Critical to Fighting the Peak Oil Catastrophe
Robert McFarlane: Open Fuel Standards Are Critical to Fighting the Peak Oil Catastrophe
by Chris Martenson

"Well, I wish I had a more hopeful answer for you. You've nailed it. We really are very likely to face either a disruption violently [by terrorism] or a political decision by OPEC to change the price of oil to $200 to $300 per barrel and literally destroy the global economy."

So predicts Robert McFarlane in today's interview, which focuses on current U.S. energy policy and the risks it faces. Mr. McFarlane's many decades of public and private service in both the Middle East and global energy markets make him uniquely qualified to opine on the merits (or lack thereof) of the energy strategy that the U.S. is pursuing.

He sees the U.S. as committed to a foolish "monopoly-fuel" system that leaves it dependent upon and dangerously vulnerable to the actions of external players, including those hostile to U.S. interests. And as the impacts of Peak Oil begin to be felt, he believes it is a near certainty that our country – along with the global economy – will experience great shocks which we have no plans currently in place to address sufficiently. The solution lies in creating a viable market for alternative fuels, which is in our power to do, provided we can muster the political and civic will. And do so quickly.
Robert McFarlane: Open Fuel Standards Are Critical to Fighting the Peak Oil Catastrophe
 by Chris Martenson

"Well, I wish I had a more hopeful answer for you. You've nailed it. We really are very likely to face either a disruption violently [by terrorism] or a political decision by OPEC to change the price of oil to $200 to $300 per barrel and literally destroy the global economy."

So predicts Robert McFarlane in today's interview, which focuses on current U.S. energy policy and the risks it faces. Mr. McFarlane's many decades of public and private service in both the Middle East and global energy markets make him uniquely qualified to opine on the merits (or lack thereof) of the energy strategy that the U.S. is pursuing.

He sees the U.S. as committed to a foolish "monopoly-fuel" system that leaves it dependent upon and dangerously vulnerable to the actions of external players, including those hostile to U.S. interests. And as the impacts of Peak Oil begin to be felt, he believes it is a near certainty that our country – along with the global economy – will experience great shocks which we have no plans currently in place to address sufficiently. The solution lies in creating a viable market for alternative fuels, which is in our power to do, provided we can muster the political and civic will. And do so quickly.
Image | Mapping The Fugly Future with David Collum
Mapping The Fugly Future with David Collum
by David Collum

In the course of his info-scouting, Chris has conversations with many different thinkers. Some are well-known to you; others perhaps less so. An important objective of our podcast interview series is to expose our listeners to the variety of voices and points of view that Chris considers when developing the perspective that he brings to his reporting.

David Collum may be a new voice to many of you. Like Chris, David came to the field of macroeconomic study from a scientific background. Again like Chris, his published observations and predictions have begun to amass a readership built on respect for his emprical approach to projecting the future. For those of you unfamilar with David's work, we think you'll enjoy having this insider's ear to his recent recorded discussion with Chris, which covers a wide range of topics.

In short, David sees a world where market risk has been removed (through misguided government intervention), leading to perverse behavior. In many ways, we are repeating the sins of past empires – and he warns us that history has a much higher incident rate of soverign insolvency than we may want to believe.
Mapping The Fugly Future with David Collum
 by David Collum

In the course of his info-scouting, Chris has conversations with many different thinkers. Some are well-known to you; others perhaps less so. An important objective of our podcast interview series is to expose our listeners to the variety of voices and points of view that Chris considers when developing the perspective that he brings to his reporting.

David Collum may be a new voice to many of you. Like Chris, David came to the field of macroeconomic study from a scientific background. Again like Chris, his published observations and predictions have begun to amass a readership built on respect for his emprical approach to projecting the future. For those of you unfamilar with David's work, we think you'll enjoy having this insider's ear to his recent recorded discussion with Chris, which covers a wide range of topics.

In short, David sees a world where market risk has been removed (through misguided government intervention), leading to perverse behavior. In many ways, we are repeating the sins of past empires – and he warns us that history has a much higher incident rate of soverign insolvency than we may want to believe.
Image | Combating Peak Oil with Wind and Smarter Electric Power
Combating Peak Oil with Wind and Smarter Electric Power
by Adam Taggart

align=We spend a lot of time on this site discussing the risks posed by Peak Oil. It’s important to us that you understand the magnitude of our national/global predicament and take appropriate preparations.

But in addition to tracking the gathering stormclouds (of which there are many), our info scouting efforts also look for developments with potential to change the situation positively.

In the podcast below, Chris and Willett Kempton explore the potential of wind power to reduce the energy pinch threat posed by depleting fossil fuels. Dr. Kempton is an electrical engineering professor at the University of Delaware and director of the Center for Carbon-Free Power Integration. Turns out, while still early in the game, there’s action going on in wind and electricity-management that offers real promise.

Combating Peak Oil with Wind and Smarter Electric Power
 by Adam Taggart

align=We spend a lot of time on this site discussing the risks posed by Peak Oil. It’s important to us that you understand the magnitude of our national/global predicament and take appropriate preparations.

But in addition to tracking the gathering stormclouds (of which there are many), our info scouting efforts also look for developments with potential to change the situation positively.

In the podcast below, Chris and Willett Kempton explore the potential of wind power to reduce the energy pinch threat posed by depleting fossil fuels. Dr. Kempton is an electrical engineering professor at the University of Delaware and director of the Center for Carbon-Free Power Integration. Turns out, while still early in the game, there’s action going on in wind and electricity-management that offers real promise.

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