Most socially aware Americans have heard about something called the “oil crisis.”  Many people understand the basic idea, but what most people don’t realize is that the oil crisis is an unstoppable global phenomenon that will permanently change the way we live.  Most importantly, people do not know that, by many accounts, this “crisis” will occur sometime in the next three to five years.  There is not much question among experts that the oil crisis will occur, but there is plenty of speculation about when it will occur and what it will be like.  Our society is deeply dependent on oil to function. Almost every consumer good in America requires some form of petroleum somewhere in its production  (Savinar 15).  Oil also powers nearly all of our transportation industry.  The factors determining the severity of the oil crisis are complex in the extreme, so making predictions about it is likewise very difficult.  Because predictions are so speculative and the consequences are so important, there are widely differing opinions about when and how the crisis will occur. One important element of the crisis is the concept of “Peak Oil.”  According to the Association for the Study of Peak Oil&Gas or ASPO, a multi-national network of scientists, affiliated with European institutions and universities, Peak Oil is the date at which global oil production will reach its greatest ever rate and begin to decrease.  (ASPO).  While some people believe that Peak Oil will bring a disastrous energy crisis, I would argue that Peak Oil will stimulate rapid advances in energy technology that will soften the transition from oil to alternative energy.

People have used oil since ancient times as a medicine and as a building material.  However, oil did not become an important resource until the late 1800s, when the invention of the kerosene lamp brought oil consumption into people’s everyday lives.  When the automobile was invented, petroleum suddenly became today’s valuable, sought-after, “black gold” (Hall).  The oil industry has continued to expand into the sprawling. multi-billion dollar behemoth it is today. Until now, we have consumed more and more oil to fuel an explosion of cultural growth and technological development.   We have ridden the wave of cheap, readily available energy and it has taken us to great heights.  The problem is, now the wave is peaking and our abundant source of energy is rapidly disappearing.  Oil is not a renewable energy source, which means that there is only so much of it in the Earth.  Once we run out, it could take millions of years for more to accumulate.  It is a fact that we are rapidly running out of cheap, readily available oil, and that oil prices will continue to rise.  This problem of running out of cheaply available oil is the definition of the oil crisis.

There is much debate about the nature of the oil crisis.  People want to know when the crisis will occur and what it will be like, so they can know what to expect.  The question of what it will look like is cause for endless speculation.  Predictions range from the apocalyptic destruction of humanity, to a seamless transition to alternative energy sources, to the discovery of inexhaustible oil wells. Some feel that the future of energy is bright.  According to the fact gathering website zFacts.com, “There is not going to be enough of a crisis. Not only will running out of oil fail to kill off several billion people as predicted (that's a relief) but it will not even raise the price of oil and gasoline enough to slow our energy growth rate…” (“Peak Oil Crisis?” 3).  Most people are less optimistic, but are not sure if the oil crisis is inevitable, “The earth, [the 2001 Baker Institute Report] concluded, was ‘precariously close to utilizing all of its available global oil production’, thereby ‘raising the chances of an oil supply crisis’” (Boal et al. 47).  Still others, like Matt Savinar, creator of the website, “Life After the Oil Crash,” predict an inevitable catastrophic upheaval,

Civilization as we know it is coming to an end soon. This is not the wacky proclamation of a doomsday cult...Rather, it is the scientific conclusion of the best-paid, most widely respected geologists, physicists, and investment bankers in the world. These are rational, professional, conservative individuals who are absolutely terrified by a phenomenon known as global "Peak Oil.” (1)

There is much contention about the nature of the oil crisis because it is hugely complex, and involves many political, technological, social, and economic factors.  Any attempt to predict the future of oil must weigh these factors and predict how they will change. 

The question of when is closely related to the date of “Peak Oil.”  Predicting Peak Oil is critical to predicting the oil crisis. For instance, if all our oil wells mysteriously dried up tomorrow, Peak Oil would be now and the crisis would indeed be catastrophic. On the other hand, if the world turns out to contain more oil than we think, the date of Peak Oil could be pushed back twenty years, and we would probably never have a crisis. Energy technology would have time to develop some viable alternatives (PeakOil.com).  Currently, demand for oil is increasing exponentially.  Oil production is also increasing, but not quite as fast.  This results in an increase in the price of oil.  This trend was observable at the gas pumps September 2005 when prices soared to over $3 per gallon.  It certainly won’t kill our economy for oil prices to increase linearly, but when Peak Oil occurs, the effects will not be linear.  As the consumption rate continues to increase exponentially and the supply rate flattens out and begins to drop, the disparity will grow much more rapidly.  The huge difference between supply and demand will cause prices to rise uninterrupted at an unprecedented rate.  This price spike is what will affect people on the street, and cause the oil crisis (PeakOil.org). The size of the spike will determine the severity of the crisis, and the date of Peak Oil will affect the size of the spike. This is a simplistic model because of the immense complexity of the world oil market, but it is based on the fundamental economic principles of supply and demand.  Nevertheless, the point remains that the date of Peak Oil is of central importance in determining the nature of the oil crisis.

The oil crisis has huge potential to be catastrophic.  If handled incorrectly, or simply ignored, it could very well destroy our culture.  Dr. C. Campbell, a Trustee of the Oil Depletion Analysis Centre, believes that “The scene is set for the Second Great Depression” (3). The dynamics governing the nature of the oil crisis are based on rates of change and certain arbitrary conditions.  If these rates prove to be unfavorable, we will face a worse crisis.  For example, if the rate at which our economy expands is not fast enough, it would increase the severity of the crisis.  If trade rates, which are influenced by the political situation with the big Middle Eastern oil exporting countries, are not good, it could spell doom for the American oil economy.  If the rate at which people recognize the danger and act isn’t great enough, the oil crisis could have the effect of accelerating blindly into a brick wall.  If the rate at which alternative energy technologies such as electric cars and efficient solar panels develop is insufficient, a relatively “dark age” of stagnant culture may result (ASPO).  It is clear that if humanity sits around twiddling its metaphorical thumbs, then these rates may well be unfavorable and the oil crisis will hit us hard.  Those who predict a catastrophic oil crisis usually base their claims on a pessimistic appraisal of these rates.

Those who feel that the oil crisis will have very severe effects point out the world’s dependence on petroleum products and surmise that if oil becomes too expensive, people simply won’t be able to afford a decent standard of living.  They predict that unemployment will soar, the bottom will drop out of the economy and general hardship will descend upon the US and the world (Savinar 4).  To use the analogy of Dr. C. J. Campbell, “Everyone had the equivalent of several unpaid and unfed slaves to do his work for him. These slaves are now getting old and won’t work much longer.  We need to find how to live without them” (5).  Until now, we have exploited oil as if it was our energy slave.  We have used it to haul our freight, power our homes, and do all our work for us.  There is not much real argument about whether or not the world is highly dependent on oil.  Oil isn’t just used to power machines, it is the main ingredient to most plastics, and it is necessary for medicine, electricity, candy, rubber, and a host of synthetic chemicals.   The oil crisis will also affect us by heavily impacting the world’s food supplies. Worldwatch research associate and author of "Home Grown: The Case for Local Food in a Global Market" Brian Halweil is concerned about this problem.

We are spending far more energy to get food to the table than the energy we get from eating the food. A head of lettuce grown in the Salinas Valley of California and shipped nearly 3,000 miles to Washington, D.C., requires about 36 times as much fossil fuel energy in transport as it provides in food energy when it arrives.  The farther we ship food, the more vulnerable our food system becomes. (Lazaroff 3)

Earthjustice Advocate Cat Lazaroff is of the opinion that many parts of the US simply do not grow food anywhere near them.  It is cheaper to grow corn in Indiana and ship it to Florida than it is to grow vegetables locally.  In a worst-case scenario where people are reduced to growing all their food locally, arid regions would simply not support large populations (Lazaroff).  Because dependence on oil is so ingrained in our lifestyle, even small changes in oil prices will have a large effect on our lives.  

With this much at stake, it is clear that alternatives to oil must exist before oil prices shoot up, or we will face difficulties.  And of course, there is the possibility that they won’t exist by the time the oil crisis hits.  Hydrogen is put forward as the wave of the future, but hydrogen fuel cell technology has been developing for the last 20 years, and it is still nowhere close to being a viable energy option (Hall 1).  Why could we expect it to be a real alternative in the next five years?  Electric power is a real alternative, but a deceptive one.  Much of the country’s electricity can only be generated with abundant, cheap oil, and battery technology is not anywhere near as efficient as oil in terms of weight and storage.  For example, independent researcher Greg Schneider found that engineers have built a prototype electric car with the performance capabilities of a top of the line gas-powered sports car that is powered entirely by 6,800 tiny cell phone batteries.  The car can be plugged into the wall to charge, and it doesn’t pollute.  What’s the hitch?  It costs $220,000 (Schneider 5).  Scientists and engineers have plenty of good ideas for alternative energy sources, and they have made many of them work, but so far none of them can come anywhere close to the efficiency of oil.  This deficiency has two effects: It increases the risk of a disastrous oil crisis by not providing us with options, and it reduces consumers’ incentive to explore alternative energy.  If a gas powered car is 50% the cost of an electric hybrid one, how many people are going to spring for the electric one based on some nebulous threat of expensive gas sometime in the unknown future?  Once again, if alternative energy technology does not catch up to the power of oil before we start running out, we are going to be short on energy.

The laws of physics state that to make anything move, energy must be exerted.  In the modern world, almost all of the toughest moving jobs are driven by the best energy source: oil.  Almost all our transportation infrastructure relies on oil.  My neighbor, Russell Sullivan, former Boeing engineer, is of the opinion that without oil, all but a handful of the world’s planes would be grounded.  He informed me that we currently have no other financially feasible way to store energy in a plane that is potent enough to propel it through the air at speeds necessary for flight, and still be light enough to get off the ground.   In terms of energy per pound, oil is vastly superior to any existing technology. We currently have no energy source that could come close to matching oil in terms of availability, cost, and power to portability ratio (Sullivan).  Almost all of our freight, air travel, civilian transport, and military infrastructure are powered exclusively by diesel oil and gasoline.  If oil prices spike, people will be unable to afford a simple day trip to the state capitol.  European vacations will become a pricey luxury. We will be forced to crawl where before we could run. In short, people’s worlds will shrink. 

To sum up, the risks involved with the oil crisis are grave.  The precipice upon which we stand may well be one overlooking the destruction of our economy and the unraveling of our culture.  If we lack the foresight and the expertise to overcome our dependence on oil, we may fall right along with the oil economy.  If the oil economy does indeed topple our current way of life, it will be through our own failures.  We will have squandered the muscle of our unpaid and unfed slaves, and not used it to secure our future.

However, all is not lost.  By most accounts, there is still time before the oil crisis catches up with us.  A fair guess at the date for Peak Oil is approximately 3 years from now.  One must take into account the exponential increase in scientific achievement over the last 10 years. Technology tends to progress in leaps and bounds, whereas the Peak Oil problem approaches with more or less mathematical certainty.  This is why energy technology will probably be the most variable factor determining the severity of the oil crisis. Partly because of its uncertain nature, energy technology could also have the biggest impact on the world’s energy situation in the future.  For example, James R. Maughan, General Manager, Controls and Power Electronics GE Energy argues, “Sustainable Nuclear fusion is kind of the holy grail of energy technology.”  We most likely will not have nuclear fusion to power our world by the time the oil crisis hits, but the possibility is there.  It is that real possibility that we will, through the incentive of our lack of oil, find some breakthrough technology that fuels my optimism for the future. 

There certainly is reasonable hope that energy technology, as well as other factors, will reduce the severity of the crisis. For example, we have sophisticated satellites capable of detecting oil deposits from space (Gazette-Times).  People are becoming more aware and conscious of the oil dilemma, and as the cost of alternative energy decreases, are switching more readily to solar power and energy efficient systems.  Engineering professor Stephen E. Silliman of the University of Notre Dame commented that energy technology will be the fastest growing and most influential scientific field of the younger generation.  As oil prices go up, the market incentive to buy and develop better alternative energy sources will increase.  You can buy a Toyota hybrid car powered by both gasoline and electricity for only 30% more than its conventional gasoline counterpart.  All of these things give us hope for the future of energy and the oil crisis.

Of the many inventions that will be driven by the necessity of the energy crisis, one of the most important will almost certainly be more efficient solar cell technology.  Solar cells are currently only about 20% efficient.  As of yet, they are not profitable for use in small applications, or for short time spans.  However, when the price of electricity goes up, the application of solar panels in a residential setting will be very attractive.  The sudden increase in interest will drive research to bring the cost down and efficiency up.   This, in turn will increase consumer interest, and before too long, each neighborhood will produce most of its electricity locally in an efficient, clean, renewable way.   All that stands between this futuristic scenario and reality is competition from the oil economy, a minor scientific advance, and the market incentive to start the process rolling.  It would take a major technological leap for solar power to take over from oil for transportation, but it is certainly a realistic goal for residential electricity.

An example of people incorporating energy conservation into their lives would be a Notre Dame professor and her husband who built an energy efficient home in Michigan.  They used a variety of energy conservation technologies to minimize their energy consumption and their negative impact on the environment.  They insulated their home effectively against unwanted heat exchange and added a geothermal heat exchange system to help heat and cool their house as needed.  They also retrofitted their house for solar panels so that when solar panel efficiency increases it will be easy to install them.  These energy efficiency measures already keep their energy bill low and will help enormously when natural gas and electricity prices go up.  If every homebuilder had the foresight of this couple, perhaps there would be no oil crisis.  Towards this end, the government is trying to encourage these conservation strategies by offering significant tax incentives for building houses with energy efficient systems (Interview A).

Most people agree that the world is too deeply dependant on oil not to feel the effects of Peak Oil and the oil crisis.   However, I predict that the crisis will be manageable.  I would argue that there will be a window of time, possibly a year, when the price of oil will increase significantly, but not too sharply. I feel that this window of time where oil prices are stimulatingly high, but not prohibitively high, will be of critical importance to the severity of the oil crisis.  During this window, the market incentive to swiftly develop and market alternative energy will be great, and the price of oil will not be too great of a hindrance to the development and spread of that technology.  I would argue that there will be moderate hardship and slight turmoil, but since necessity is the mother of invention, it will drive innovation and change for a more energy efficient way of life.

To illustrate this prediction, consider the following scenario: Imagine that over the course of a year, gas prices rise steadily from $3 a gallon to $15 a gallon.  Average consumers would notice this increase and feel its effects on their wallets.  It would simply not be cost effective to buy a new gasoline powered car once the additional cost of gas was factored in.  They would probably need to switch to electric cars to afford the commute to work.  Electricity may be more expensive than it is now, but it will most likely be much cheaper than gasoline.  They would have had to adjust their lifestyles to significantly reduce their dependence on oil.  They probably would have felt some economic hardship that year from weaning themselves of petroleum products, but they certainly would have survived.

Part of my reasoning for a mild oil crisis is a belief in the resilience of human nature in the face of adversity.  People could survive temporarily without cheap oil, and in case of a natural disaster or sudden oil shortage, the US is on its way to storing 1 billion barrels of oil in a strategic oil reserve “just in case” (Fossil Energy Office).   Most of the US has its basic needs taken care of.  Even if the crisis did turn out to be catastrophic, humanity would swiftly find ways to adapt and survive.  After all, necessity is the mother of invention.  The threat posed by the oil crisis is, I think, to our comfort and our convenience, not our health or happiness.  We shall have to give up our wasteful habits like shipping food all over the country unnecessarily and driving SUVs.  Our society has a huge amount of economic and technological momentum.  It is my belief that that momentum will be sufficient to bridge the gap between the oil crisis and the advent of alternative energy technologies.

The most important factor in mitigating the harm inflicted by the oil crisis will certainly be people’s awareness of the situation and their willingness to make small personal sacrifices and prudent choices about energy conservation.  Everyone should be aware that the age of SUVs and the entire oil economy is drawing to a close and, according to my research, in all probability will be over in the next 10 years.  I would love to be proven correct in my prediction that the age of oil power will pass without disaster because our society realized the danger and found another energy source capable of providing our society with the power it needs to thrive.  Our society has been granted an enormous leg up with its development by the exploitation of fossil fuel.  We have reached great heights riding on its muscle.  As we start to run out, we must be extremely careful how we use the last of it, so we maintain our level of achievement.  Unfortunately, our relationship with oil has been sordid.  Riddled with political strife, wars, greed, and oppression, our tainted relationship with our energy slaves has mirrored our tainted historical relationship with human slavery.  Oil has definitely become a mixed blessing.  I for one will not be particularly sad to see the dirty, smelly, noisy age of oil retire in favor of clean, renewable electricity and hydrogen technology.  As the next decade rolls around, it may find our cities humming with clean electric and hydrogen power. 

Works Cited

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