<HTML><BODY style="word-wrap: break-word; -khtml-nbsp-mode: space; -khtml-line-break: after-white-space; "><BR><DIV><DIV>On Sep 3, 2005, at 4:32 PM, Hal Finney wrote:</DIV><BR class="Apple-interchange-newline"><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Here are a few more thoughts about Peak Oil.</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">For those who have not run into it, although there are many variants,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">the most virally virulent version of Peak Oil says that we are within</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">two or three years of the fall of Western civilization.<SPAN class="Apple-converted-space"> </SPAN>This may seem</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">absurd on its face but I will lay out the argument briefly.</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">It is suggested that we are reaching a peak in oil production such that</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">no reasonable amount of money, or perhaps no amount of money whatsoever,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">can increase production levels.<SPAN class="Apple-converted-space"> </SPAN>While the world's oil wells still have</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">lots of oil, it is becoming harder and harder to extract.<SPAN class="Apple-converted-space"> </SPAN>Existing</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">technologies to increase the rate of extraction work for a few years</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">but then the fields "die" and the rate of production begins to fall</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">by 10 to 20 percent per year, and no known technology can change that.</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">There is nothing, in this view, that can increase the rate of production</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">of oil to overcome the declines that are appearing in more and more</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">countries around the world.<SPAN class="Apple-converted-space"> </SPAN>Only Saudi Arabia claims to have the ability</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">to increase production, but Peak Oilers generally believe that Saudi</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Arabia is lying.<SPAN class="Apple-converted-space"> </SPAN>Oil analyst Matt Simmons published a book this year,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Twilight in the Desert, analyzing Saudi oil fields in detail and arguing</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">that they are near their own peak.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>As I used to work in (or at least on the outskirts of) the industry I can attest that this is more or less correct. There are no known technologies that can significantly increase the productivity of a field without shortening its productive lifetime or prevent its eventual decline in production. Some of this is simple common sense. It is not a "view". What is a view is the notions portrayed of what the consequences of world wide oil demand outstripping supply will likely be. But that demand will outstrip supply is incontestable.</DIV><DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">This supposedly inexorable decline in oil production levels runs head-on</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">into rapidly growing world demand for oil.<SPAN class="Apple-converted-space"> </SPAN>China in particular, but</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">also other countries like India, are expanding their oil consumption at</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">a rapid rate.<SPAN class="Apple-converted-space"> </SPAN>And of course Western countries, especially the U.S.,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">are also continuing to use more and more oil every year.<SPAN class="Apple-converted-space"> </SPAN>Although the</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">West has improved its oil efficiency in many ways, the current economy is</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">fundamentally dependent on oil for growth, and in the present situation,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">economic growth will be impossible without increasing the supply of oil.</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">The collision of these two trends will, it is claimed, produce</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">catastrophe.<SPAN class="Apple-converted-space"> </SPAN>Oil prices will skyrocket to unheard-of levels, hundreds of</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">dollars per barrel.<SPAN class="Apple-converted-space"> </SPAN>Most people will simply be unable to afford gasoline</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">or heating oil.<SPAN class="Apple-converted-space"> </SPAN>Airlines and other forms of transport will go bankrupt</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">and business failures will be widespread.<SPAN class="Apple-converted-space"> </SPAN>The economy will enter a</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">permanent state of decline that will make the Great Depression look mild.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>I don't know about hundreds of dollars per barrel but as it stands we are certainly headed for a very real energy crisis. There are many factors that lead me to belief that we are also in for an exceedingly dangerous and painful economic crisis other than peak oil. </DIV><DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Worse, even essentials like food and pharmaceuticals are highly dependent</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">on oil, and with the explosion in the price of this crucial commodity,</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">the world will see a rapid spread of famine and disease.<SPAN class="Apple-converted-space"> </SPAN>This produces</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">what Peak Oilers call the "great die-off" and many of them expect it</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">within a few years.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>You are talking about one particular fringe group of people who believe peak oil is real. Implying that all people who believe Peak Oil is real have the same beliefs is dishonest. Let us see and address the real problem instead of disowning it.</DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">This may seem like an astonishingly implausible scenario, but it is widely</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">believed among the Peak Oil community.<SPAN class="Apple-converted-space"> </SPAN></DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV><DIV>Not really.</DIV><DIV><BR class="khtml-block-placeholder"></DIV><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Of course, not everyone concerned with Peak Oil buys into this whole</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">picture.<SPAN class="Apple-converted-space"> </SPAN>There are a range of beliefs.<SPAN class="Apple-converted-space"> </SPAN>Some see this scenario playing</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">out, but not for a decade or more.<SPAN class="Apple-converted-space"> </SPAN>Others think that the impact will be</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">limited to a permanent state of economic depression, and don't accept the</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">great die-off.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV><DIV>Others including myself believe that new technolgies will take up the slack. Unfortunately the deniers of the problem and the real inertia of how long it takes to bring alternatives fully online means there will be some harsh consequences before the problem is sufficiently addressed. </DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; "><SPAN class="Apple-converted-space"> </SPAN>People also disagree about just when the peak will occur.</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Some see it as 10 to 15 years off, others out 5 years or 2 years, and</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">yet others think it's already happened and we are beginning to feel the</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">first effects.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV><DIV>It is difficult to say without much more impartial and complete data on the state of existing fields. But my guess would be no more than 5 years. My suspicion is that it has already begun among those in power who see it coming. </DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; min-height: 14px; "><BR></DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Needless to say, this is not a very Extropian image of the future!</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>Being Extropian does not include living in denial of real problems! Extropianism is not simply wearing high tech rose-colored glasses.</DIV><DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">And if you look closely you can see some inconsistencies and flaws in</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">the assumptions that this scenario is based on.<SPAN class="Apple-converted-space"> </SPAN>Nevertheless the Peak</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">Oil community devotes enormous efforts to analyzing every scrap of news</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">about oil supply and demand levels all over the world, and in fact their</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">predictions do hold up pretty well against recent trends.<SPAN class="Apple-converted-space"> </SPAN></DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>Yes. </DIV><DIV><BR><BLOCKQUOTE type="cite"><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">As oil reaches</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">each new price level, Peak Oilers take it as vindication and confirmation</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">of their views.<SPAN class="Apple-converted-space"> </SPAN>There was a time when $50 oil was unimaginable.<SPAN class="Apple-converted-space"> </SPAN>Then $60</DIV><DIV style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; ">oil was unimaginable, then $70.<SPAN class="Apple-converted-space"> </SPAN>Today $80 or $90 oil is unimaginable.</DIV></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV>Non-fringe major financial sources have talked about spikes to $100 per barrel. When that happens will you believe the problem is real? What would constitute enough evidence to convince you that we face a very real problem?</DIV><DIV><BR><BLOCKQUOTE type="cite"></BLOCKQUOTE></DIV><FONT class="Apple-style-span" color="#0000DD">- samantha</FONT><BR></BODY></HTML>