Eco-Justice Ministries  

Eco-Justice Notes
The E-mail Commentary from Eco-Justice Ministries

Peril at the Peak
distributed 7/8/05 - ©2005

In the last few months, as world prices for crude oil have passed $50, then $60 per barrel, a new term has entered our vocabulary -- peak oil. Whether or not you use that term, we're all going to become very familiar with what it describes.

The "peak" of peak oil refers to global oil production reaching its highest levels. Many experts tell us that we are now at, or very close to, that peak. The big oil fields, the easy-to-extract oil, is already in production. New discoveries are rare, and what's left is hard to extract. As production declines in the current oil fields, and no equivalent resources are available, the total amount of oil flowing around the world will soon start to drop.

That reduction in the amount of oil available comes at a time when the world-wide demand for oil is increasing. The US and China are the two most dramatic examples, but almost all other nations --- "developing" and "developed" -- are using more petroleum.

If you remember anything about the basic economic theory of supply and demand, you know that scarce supply and strong demand will lead to higher prices. When the product is an essential commodity like oil, even a very small difference between available supplies and larger demand will create dramatic economic shocks.

US oil production peaked in the 1970s. This country is still producing oil -- quite a bit of it -- but less is coming out of US wells than 10 years ago, and that was less than what was produced in the 70s. The US has been able to satisfy its energy appetite by importing vast quantities of oil from other parts of the world. But when global oil production peaks, there's no other source to cover the shortfall. The impacts will be dramatic and painful.

There are indicators that we may be at the global peak right now. Crude oil prices have gone up 55% in the last year alone, and even oil giant Saudi Arabia seems to be producing at maximum capacity. The more "optimistic" predictions put the peak 5 or 10 years out, and no responsible analysis of energy sources pretends that oil production can keep rising forever. Declining oil supplies are a matter of when, not if.

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A very small part of my radical environmentalist self sees peak oil as good news. When oil and gas become scarce, when the price of gas skyrockets, energy use will drop dramatically, just as it did during the OPEC-triggered oil crisis in the '70s. That economic shock will cut greenhouse gas emissions and other forms of pollution. High transportation costs will trim the incentives for urban sprawl. Raw economic forces will bring conservation steps that public policy hasn't been able to create.

But the environmental benefits from rising energy prices will come at a very high cost socially, and in other environmental areas. Peak oil is a textbook case of eco-justice, where ecological and social justice concerns intersect and interact.

  • High energy prices -- especially for gasoline and heating oil -- will hit the poor hardest, and they have the fewest options for coping with that impact. Their gasoline is used to get to work, not for distant vacations. They don't have the options of buying new, fuel-efficient cars. Their heating bills soar when a landlord chooses not to provide insulation or update the furnace.

  • The world's reaction to the oil deficit will not be pretty. More wars over oil and gas supplies are to be expected, and desperate efforts to get at any and all fossil fuels will overwhelm any other consideration. We're seeing the first indicators of that desperation right now in the US: authorization of oil drilling in the Arctic National Wildlife Refuge; an astronomical increase in the number of natural gas wells in the western US, with roads and pipelines fragmenting habitat, wastewater polluting streams and prairies, and coal bed "fracturing" disrupting water wells; inefficient petroleum sources like oil shale and tar sands are being explored, and it is well known that putting them into production will create boom towns, use vast amounts of scarce water, and generate lots of pollution.

  • Expensive energy will have far-reaching second-level economic impacts. Fuel costs will bankrupt airlines and shutter tourism industries. Food costs will rise along with the higher prices for oil-based fertilizers and herbicides, and for transportation. Economic recession, or depression, will cause global turmoil. On the positive side, new jobs will emerge in fields of energy efficiency and alternative energy.
We are living at the "peak oil" moment. Wishful thinking will not create more oil. Denial will not make the problems go away.

As people of faith, as people of compassion, as people who seek justice and peace, as people who seek to care for all of God's creation, we already have the values and commitments to guide us into the coming days. If we are to true to our faith and values, we need to act now to name and address this emerging situation.

In our churches and our broader communities, we can call our neighbors and our leaders to decide between the options for dealing with declining oil in our petroleum addicted world. Will we punish the poor and the powerless, and devastate the natural world, as we try to wring every last drop of oil for our own comfort and profit? Or will we act decisively to wean our culture from oil, to protect the poor from the brutal impacts of soaring energy costs, to preserve the web of life, and to minimize global conflict?

The crisis point for our world is not the day when we run out of oil. It is the day when our rising demand for oil exceeds declining production, and that day is now upon us. We can address the impending crisis with grace, wisdom and compassion, or we can blunder our way into painful catastrophe.

May God open our minds and our hearts, and call us to lead our communities in the way of peace.


Peter Sawtell
Executive Director
Eco-Justice Ministries

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