The world has peaked on oil production. Consumption rates are up, and oil, as a non-renewable resource, is rapidly being depleted. A few points:

1) New Technology: Yes, new methods of extraction will probably be able to recover a fraction of the 1/2 or so of oil left in the planet. However, the easy, cheap-to-get-to-half has already been burned. Where we once extracted oil at an energy cost ration of 28:1, its now closer to 3:1. At 1:1 it makes no sense to continue even if its technologically possible.

2) Shrinking Planet: A common concept is that the world is shrinking – not physically of course, but its becoming easier and easier to teleconference around the world, get fresh fruit from other hemispheres, etc. In fact, compliments of cheap oil and Internet technology, I meet and married my wife from half-way around the world. Once oil becomes rare, and the cost goes up, the world will get bigger again. The airlines are struggling now, what will happen to them if fuel cost skyrocket? They simply go out of business. Atomic powered airplanes are not likely…

3) Growth: Growth is good right? Its required by common thought: City’s must grow to thrive, companies are either growing or dying, New Home Starts are a primary indicator of economic well being. Its all based on cheap oil. We saw it briefly around 2008-2009 when gas jumped to $4/gallon. What happens when its $10/gallon? Will people still want to commute 50 miles a day to work?

4) Food: Modern agriculture has been defined as the process of turning oil into food. We use natural gas (methane – often found under oil where the pressure and temperature break down the more complex oil hydrocarbons to simple CH4) as a feedstock for nitrogen fertilizer (via the Haber process that converts nitrogen gas (80% of air) and hydrogen into ammonia). We use massive amounts of diesel to power water pumps, plow fields, spray chemicals, spread fertilizer, cut hay, bale hay, move hay, ship grain, dry grain… not to mention trucking and flying the products to where they are needed.

5) Electricity: Natural gas is viewed as the “clean” fuel for running electric generators. Alas, its non-renewable. Recent discoveries have bought us some time in the USA, but that too will run out. The USA has NO new nuclear plans in progress (an Apollo class effort to use our remaining oil to build breeder reactors and power plants would help a lot). Fusion would be great, but other than H-bombs, we haven’t made a lot of progress in that space in the past 30+ years.

6) Plastics, pharmaceutical, etc.: Oil is the basis for Plastics, and for many pharmaceuticals.

So what happens when oil becomes rare?

A) The world gets larger again. More things will need to be done locally. Walmart’s “Rolling Warehouse” stops rolling.

B) Mechanized “efficiency” dies: Manual labor replaces or augments mechanized labor. Farms become MUCH smaller, possible horse driven again. Mega school districts break up into smaller ones with walking distance of homes as the school bus system breaks down. On the positive side: Many new jobs will be created. Suburbia contracts, painfully, towns need to be (re) created with smaller shops within walking distance of most homes. Can’t do that when the homes are spread around on 1/2 acre lots.

C) Big cities are in real trouble. Any building over about 5 stories tall becomes unusable.

D) Life expectancy will probably go down. More manual labor means more accidents – there will be a toll in human life.

E) The population will decline to the solar and natural carrying capacity of a region. Good-by Phoenix, Las Vegas, etc.

So when will all this start? How long will it take? Thats anyones guess, but my feeling is that we are at the proverbal “knee in the curve”. I doubt we have 10 more years of life as we know it.