← Back

Your message to the BLOGMASTER was sent

Submitted by Bush tea

image

Source: Bloomberg

Bush tea we take your point but there is a process which Barbadians will have to undergo to achieve the philosophical change which you are suggesting. Could we say that the same triggers or mental gymnastics required for Barbadians to shift to greening is the precursor to changing how we are currently managing things?

David – BU

With the cost of oil ballooning to US $122 per barrel in May 2008, it has become apparent to just about everyone that we have a global crisis on our hands. Cheap oil is the foundation on which everything that we hold dear stands; from the water we drink; the food we eat; the way we travel, communicate; etc to the very materials – especially PVC’s and plastics that we use. Most of us only seem to have recognized this crisis now that the actual problem of high prices, scarcity, and even food riots and open chaos in some countries has hit us in the face.

Even more confusing, to my mind, has been the exercise of agreeing on how we need to respond to the crisis.

Putting aside the outrageous ideas such as having Government subsidize the cost of energy so that food and other products continue to be affordable; or of ‘negotiating’ double digit salary increases to enable workers wages to keep in step with rising costs; learned commentators such as JR and even the Barbados Light & Power now, have been pointing at conservation and finding alternatives to fossil fuels ( so called ‘greening’) as the best answer to the challenges that we face.

Question:

Why has oil become so valuable that it can now command a price that is 1000% of its value just 10 years ago?

The simple answer is because we have created a world where ‘success’ is defined in terms of the amount of goods that we are able to accumulate (GDP). In the last 40 years, our industrial infrastructure has been able to reach unprecedented levels of efficiency in producing goods and services. It stands to reason therefore that demand for ALL factors that are critical for ‘success’ will experience significant supply /demand pressures. It is not only fossil fuels that have exploded in value. Metals like copper, aluminum, gold etc and even rare items like plutonium have seen explosive increases in costs.

Here is the fundamental point.

If instead of oil, our industrial productive complex is converted to ‘green’ factors such as solar, wind, and bio products, the kind of phenomenal growth that current productive philosophies dictate will very quickly create a demand situation such that the basic input factors for the ‘green’ energy culture will experience the same pressures that oil and the metals etc now face.

In short, the basic problem will remain – only the symptoms will be a little different.

What then is the REAL problem?

The problem is obviously the clearly misguided but generally accepted philosophy that success is somehow related to ‘growth’ of productive output. Not that goods and services are unimportant, but surely- as with almost everything else- there is an optimum level of development above which, the cost-benefit factors decline significantly. The attached graph indicates this relationship.

We have moved our world into a position where enough persons are now far enough into the ‘B’ section of the graph that the overall strain is resulting in shortages of the critical inputs like oil. (… and lots of us – including those with huge resources, are increasingly unhappy) I am suggesting that the optimum developmental point is such that life on this earth can be idyllic for all of us, even while operating sustainably within the capacity of earth’s resources.

How much is enough?

Man is designed with unlimited potential. It is absolutely natural for us to refuse to be bounded by limits. This is why we spend billions to get to the heavens, the deepest depths of the sea and the darkest mysteries of life. It is also why we are so focused on ‘development’, which, to a certain point IS worthy of our ingenious efforts. The problem of course is that we have not recognized the REAL area of endeavor, which is intended to tax our collective drive and endurance, and like unguided youth we waste our enormous energies in fruitless and misguided endeavors.

It is like the common situation of the wayward child who, for lack of guidance from a special teacher, is condemned to become a troublesome mischief -maker, rather that the brilliant, talented leader of society that was possible – but for the proper directing of his natural talents. As a species, we have used our boundless talents to pursue material assets – and we have outdone ourselves to the point that the earth can no longer sustain our onslaught.

A change in course?

One would have thought that the current crisis would cause us to raise fundamental questions and would perhaps assist us in effectively changing course, but alas, we prefer to concentrate on finding alternative and more efficient means of misdirecting our energies towards accumulating goods.

As with the development of our youth, the critical factor in achieving any kind of success will be the existence and commitment of suitable teachers who can provide the leadership and guidance required. This is intended to be the role of the church, but we are now so far removed from this realization that some other arrangement will be needed if we are to move forward.

A hint from Bush tea

I am NOT a ‘teacher’ in the above sense, however I will provide a small hint of the REAL purpose and challenge on which our collective ingenuity and creativity should be channeled –

It is towards the creation and refinement of ‘excellence of character’.

…now here is a REAL challenge, given the different and contrasting personalities, ethnicities, moods and other differences among human beings, this is the ULTIMATE challenge that mankind can face.

To create a society where individuals, families, communities, countries and the global community, are molded into a model of human development. Where ultimately the epitome of achievement is a state of righteousness – that is – a state where a human being will CHOOSE to do the RIGHT thing given any range of conditions, options and inducements to the contrary.

No leader on this earth that I know of has the wisdom, strength or ability to put together such a global arrangement. However, I can tell you all – that very shortly, exactly such an arrangement will be implemented RIGHT HERE on this planet, including Barbados, by a leader that is ‘out of this world’.

…and Bush tea will be one of his boys…


Discover more from Barbados Underground

Subscribe to get the latest posts sent to your email.

60 responses to “Responding To The Challenges Of Expensive Energy”

  1. Keith Headley Avatar

    Four things you can do to go more green.

    1) Take the bus whenever you can. Up to a certain limit (which we are no-where near) the larger the vehicle for public transport the better.

    2) Change your diet. One of our highest bills is food import. Make a conscious effort to change than it whatever way you can.

    3) Give someone a drop. Some of us have to drive. But our cars are mostly empty. Look for someone to you know and trust to give a ride to. If you were ever without a car you will know how glad this can make someone feel.

    4) Get up a little earlier/ go to bed a little earlier. You will burn most of your gas and experience some of your greatest frustration on your way to work in the morning. Leave an hour earlier – yes an HOUR earlier; then cut back until you are in the jam again.
    For example – my experience. I use to leave home at Seven (7) o’clock. Big jam, barely get to work on time, mucho frustration.
    Left at six – road empty, get to work six fifteen (driving, before I switched to bus).
    Left at 6:10 – allowed some guy drinking a beer and driving to push me up the road to avoid him running into my back. Got to work 6:20.
    6:25 – got to work 6:40.
    6:45 – got up late; a touch of jam; got to work 7:30.
    6:30 – got to work 6:50.
    6:55 – got up late; literally had to pry my wife off me (love that woman); road clear until 7:05; actually watched people leaving their houses in droves; got work 8:05.
    6:25 – took my ultra cool time; got to work 7:05.
    6:25 – caught bus, got to work 7:15.

    I now try to leave home a little before 6:30.

    So there you have it . . .

  2. Micro-Mock Engineer Avatar
    Micro-Mock Engineer

    hmm… oil fell $4 today. Interestingly this took place despite the EIA’s announcement that supplies have fallen this past week. Although the EIA gave an explanation for this (ships unable to offload in the gulf due to poor weather), a week ago an announcement like this would have surely caused another price increase. The difference this time? Dollar showing some recovery, global oil demand beginning to fall, but most significant…the Commodities Futures Trading Commission (CFTC) announced today that it is 6 months into an investigation on price manipulation in the oil market… a cleverly synchronized shot over the bow that has at least given the speculators pause 🙂 …check out the press release here http://www.cftc.gov/newsroom/generalpressreleases/2008/pr5503-08.html

    This is an interesting development, since the CTFC effectively lost (gave up?) regulatory oversight of the US energy futures market in 2000 after Enron and other big energy traders successfully planted a loophole in the Commodities Trading Act… but David already wrote about this a few weeks ago.

    Wonder what the CTFC’s final report is going to look like… could we see a large energy trader or two implicated in a market manipulation scandal? 🙂

    Anyway, identifying the oil bubble was always the easy part, predicting the pop is not so easy. Possible triggers… the Fed announces increase in interest rates in the face of worsening inflation, or they acknowledge a US recession… no strike that… “a long period of anemic economic activity”, or release of the final report and recommendation from CTFC… or maybe the speculators just start bailing out from tomorrow… do I hear $95 🙂 … let’s see what happens over the next couple weeks.

  3. Straight talk Avatar

    MEM:

    You gone short yet?
    Or are you covering your bases.

    $170 per barrel by Old Years Night.

  4. Micro-Mock Engineer Avatar
    Micro-Mock Engineer

    … I actually put my toes in the water this past Tuesday, with a June 21 put on USO at $100 (IYS RV)… but the $150 psychological magnet looms large in my mind so I just used my profits from the Endgame Fund to make that purchase 🙂
    For now I’m content to monitor it daily before diving in…


  5. MME,

    You pooh poohed the peak oil theory in your submission of May 13th. It might interest you to note that the International Energy Agency’s report, due to be published in November this year

    “admitted that the depletion of aging oil wells, combined with the dampening effect of skyrocketing costs on new field development, means that the world will have a hard time reaching 100 million barrels a day of production within the next two decades.”

    Chris Nelder, writing for Energy and Capital comments:

    “Their previous estimate from only last year was 116 mbpd by 2030, which was backed up by similar reports last year from the EIA and the National Petroleum Council.

    Their projected supply curves are now sharply reduced, while their global demand projections continue to show about a 1.5% annual rate of growth. ”

    1.5% annual growth takes consumption to 100.1 mbpd in only ten years, MME, and there are doubts that even that level of production can be achieved. There is therefore nowhere for the price of oil to go but up as demand will continue to outstrip production for the foreseeable future.

    Chris Nelder…
    “Whatever the IEA’s reasons, however, the game is up. Most of the world now recognizes that we are up against a bona fide supply limit, and all the market is doing now is trying to find the proper value of a barrel of finite, nonrenewable, and diminishing petroleum”

    You can read the rest of the good news here..
    http://by119w.bay119.mail.live.com/mail/ReadMessageLight.aspx?Aux=4|0|8CA8F2BBA006610|&FolderID=00000000-0000-0000-0000-000000000001&InboxSortAscending=False&InboxSortBy=Date&ReadMessageId=af0f29bf-cf64-4d42-8e97-b3eed47f1961&n=635670607

    I’d be interested in hearing your comment.


  6. The above link didn’t come out complete. Please cut and paste.

  7. Keith Headley Avatar

    Let’s look at both points of view.

    1) A marvelous new invention allows us to make gas out of the sky and electricity out of thin air (hey, stranger things have happened . . ).

    OR

    2) A series of well aimed precision meteorite strikes from a previously undetected alien race devastate all major oil fields. Gas becomes very scare for a year or two.

    1) People, having no reason to change their habits continue to live as they do now. By 2020 we all live in artificial climates while we rebuild the one outside our protected domes because we removed the ozone layer, flattened the Amazon and genetically modified one organism too many (could be anything from a super virus to a t-rex).

    Though this seems silly, history has shown that we don’t change until we are forced to. So if could “invent” our way out of everything, I’m sure we wouldn’t stop until we had Jurassic Park-type problems. Just the way humans are.

    2) Humans, after the inevitable devastating riots, find new ways of living at much lower level than they did before. There is a surge in population as bored people find something to do that doesn’t electricity, gas or travel.

    Also pretty silly, but the reality is that persons who don’t have a lot or our electricity and fuel driven amusements usually amuse themselves in other ways. We call them “underdeveloped”.

    I don’t want either of these scenarios. I want people to make decisions NOW that will prevent all the possible disasters later that we can see. You can only pray about the ones you can’t see coming.

    To me the real debate is “if oil prices go to 50 dollars a barrel are we going back to the same old, same old?”.

  8. Keith Headley Avatar

    sixth line after “2) Humans . . .” should read

    “lot of our electricity”

  9. Micro-Mock Engineer Avatar
    Micro-Mock Engineer

    Inkwell,

    Peak Oil is a reasonable theory. I’ve never disputed this, just the conclusions regarding its timing and more importantly its consequences.

    Oil production (and by extension consumption) must peak at some time… so what?!?

    There are already viable alternatives, and it is well within our capability to develop new, more efficient methods of meeting our energy needs… at costs that are likely to be more affordable than today’s.

    Our knowledge of the universe (and energy), is still very primitive… but that knowledge is improving rapidly. History has demonstrated time and time again, that human knowledge and ingenuity are our most precious resources. IMHO the greatest threat to civilization today, is the rapid growth of fear-based ideologies that seek to demonize human mastery over Nature.

    I am obviously in the minority here, but I do not subscribe to the popular view that this temporary oil crisis will trigger some sort of retreat to the agrarian age… nor is it indicative of the end of project life on earth 🙂

    Here are some parting notes…

    ** The 16th century British energy crisis (timber shortage) led to the development of coal which was considered an inferior fuel at the time.

    ** In 1865, British economist William Jevons predicted Peak Coal, and warned that it could lead to the collapse of civilization. He ended his book “The Coal Question” (which can be read here http://www.econlib.org/LIBRARY/YPDBooks/Jevons/jvnCQ.html) with this statement: “We have to make the momentous choice between brief greatness and longer continued mediocrity .”

    ** Whale oil supplies (used for lighting homes with lanterns and candles) peaked in 1847 due to dwindling herds. Prices skyrocketed and innovation kicked into high gear. Two years later, in 1849, Canadian geologist Abraham Gesner distilled kerosene from bituminous tar effectively replacing whale oil for home lighting. Ten years later, in 1859, Colonel E L Drake had the crazy idea of converting his salt derrick to drill for oil (which he did with the assistance of unemployed whalers)… the rest is history.

    ** Some oil reserve estimates over the years:
    1919 — Scientific American reports the “fact” that only 20 years worth of US oil was left.1920 — USGS chief geoligist, estimates total oil remaining in the US at 6.7 billion barrels.1926 — Federal Oil Conservation Board estimates 4.5 billion barrels remain.
    1932 — Federal Oil Conservation Board estimates 10 billion barrels of oil remain.
    1944 — Petroleum Administrator for War estimates 20 billion barrels of oil remain.
    1950 — American Petroleum Institute says world oil reserves are at 100 billion barrels.
    1980 — Remaining proven oil reserves put at 648 billion barrels
    1993 — Remaining proven oil reserves put at 999 billion barrels
    2000 — Remaining proven oil reserves put at 1016 billion barrels

  10. Straight talk Avatar

    With oil up $11 today to $139 per barrel, and Bush under increasing pressure to release some of the Strategic Petroleum reserve to supplement the oil starved Gulf refineries, I think something big is about to happen.

    Some of the $15 increase is down to speculators entering the new month’s market, and some down to reduced shipments from the dwindling Mexican and Venezuelan fields.

    It may be caused by the three week transit time needed for the Middle East to plug the supply gap.

    Listening to Olmert this morning saying it is now the right time to bomb Iran.
    Russia and China restating that an attack on Iran will be treated as an attack on themselves, and will not go unanswered.

    We live in intersting and very dangerous times.

    The weather vane, I suspect, will be whether the populist President will, in an election yer, open the SPR spigots.
    If he refuses, fear for the worst, the generals need the oil.

The blogmaster invites you to join the discussion.

    Trending

    Discover more from Barbados Underground

    Subscribe now to keep reading and get access to the full archive.

    Continue reading