Bubbling Crude

As bad as this financial crisis is, there is a far greater danger just bubbling under the surface. The fundamentals of our economy come down to tangible products and tangible resources. Things we can see and touch. Services, especially financial services, provide no benefit to the fundamentals of the economy and are luxuries afforded because of healthy goods production and proper resource management. The most important of all, above even gold, is crude oil. Contrary to popular belief, crude oil does not grow in the ground. It was formed millions of years ago at a time of intense global warming. Algae growing on the surface of the ocean took advantage of the warm climate covering vast areas and sucking up all the atmospheric carbon. As this algae died it sank to the ocean floor and over time with heat and pressure, became crude oil. This process took millions of years to complete and when the carbon from the atmosphere was trapped in this oil the climate cooled and life rebounded. So here we are, living in the age of oil, using all the stored solar energy in the oil and releasing the carbon back to our atmosphere. The genie is now out of the bottle and it is unlikely, given human nature, it can be put back. Climate change will ‘change’ at an exponential rate. Most people have heard of peak oil and some even tout it as the saviour of climate change. This is false. We will use supper straws to suck and burn the last half of our oil in the next several years. Conflict and social unrest are inevitable as the general public come to realize the dependence we have on oil for food, transport, clothing, electricity and yes, lipstick. There simply are no alternatives to oil to support 7 billion people. Saudi Arabia is lying about its oil reserves. Their output will decline. All other large oil fields are declining with particular concern to the US is declines at Cantrell in Mexico. Smaller fields produce short burst of oil that will not mitigate the losses from the larger fields. And if all this isn’t bad enough the current price for crude has slowed investment in searching and developing oil supplies. Is anyone out there suggesting tar sands? The truth of the matter is tar sands are what their called. Tar mixed with sand. The only reason it is economical at the moment to extract oil from sandy tar is the presence of natural gas at the deposits which is used to boil water to extract the oil. This is really the energy from the natural gas converted to liquid and when the gas is gone it will take more energy to get the oil than the oil will provide. Governments know all this; they just don’t want you to know because there simply is no practical solution. I’m sure if Jed Clampett was alive today he would put an old piece of plywood over his oil well and stick with his organic farm. Link