The future is likely to be more chaotic than you probably think...The impact of Peak Oil on markets, lifestyles, and even national solvency deserves our very highest attention - but, it turns out, some important players seem to be paying no attention at all.
But there were two reports that really stood out for me.
The first was given by Rear Admiral Lawrence Rice, who presented the findings of the 2010 Joint Operating Environment (a forward-looking document examining the trends, contexts, and implications for future joint force commanders in the US military), which spends 76 pages summarizing the key trends and threats of the world. "Energy" occupies six of those pages, and Peak Oil dominates the discussion. Among the conclusions (on page 29), we find this hidden gem, which uses numbers and timing that are eerily similar to those that I put forth in my April 2009 report, Oil - The Coming Supply Crunch:
By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.While there are two "coulds" in that statement, the mere possibility that such an imminent arrival and massive shortfall could be true should give every prudent adult a few second thoughts about what the future may hold. If surplus production capacity disappears in just a couple of years, there is an entire world of planning that should take place beforehand at the international, national, community, and personal levels.
A severe energy crunch is inevitable without a massive expansion of production and refining capacity. While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. (p. 28)
Well, the amounts needed from OPEC are quite, shall we say, 'ambitious,' as they amount to an additional two Saudia Arabias coming on line in order to make up the shortfall. A massive crunch is not otherwise avoidable. Let's be honest; there are no more Saudia Arabias to be found.
No plans = unnecessary chaos.
While we can expect that such plans will be tossed together when necessary, I would hope that Katrina taught us a few lessons about developing plans on the fly after the disaster has already arrived. Sure, things got done, but they were certainly suboptimal and led to more confusion and more chaos than if they had been carefully developed, practiced, and debugged.
The way that I understand the lack of planning on the part of the civilian side is that Peak Oil does not present any easy political wins, if any at all. Given the two-year planning cycle in DC, it's never a good time to bring up such an unpleasant subject. Politics trump necessity.
...That's the source of my discomfort. It's not necessarily that large organizations are beginning to share my sense of timing and impact of Peak Oil, although that will hasten the tipping point of awareness. It's that somehow I always thought that because Admiral Hyman Rickover knew well that this day would come (in the 1950's!), 60 years would have been sufficient lead time to assemble some credible plans.
The lack of planning also betrays a very common attitude, which might be summarized as, "We'll deal with that when we get there."
I detect this attitude in a wide range of individuals and market participants, so it's not at all uncommon. However, I think it's a mistake to hold this view. When (not if, but when) full awareness of Peak Oil arrives on the international stock, bond, and commodity markets we will discover just how narrow the doorways really are. Only a few will manage to preserve their wealth by squeezing through the doorway early; most will not make it through. As mentioned frequently on this site, our What Should I Do? guide for developing personal resiliency against a Post-Peak future offers a valuable resource for those just getting started in their preparations.
