That said, the analogy of the bakery where suddenly 50/100 have to die due to lack of bread is silly. The world produces about 84.5 MMBD of crude at the moment and is using a little less (world stocks are building for 4th quarter). Saudi/Kuwait/UAE "slack" that held prices down for a generation is gone. What is the likely scenario from here?
Even at current high prices we are likely to see modest growth in world demand. Let's guess 2% or 1.7 MMBD. If OPEC or other producers cannot meet the increased demand and we begin to see an imbalance, prices will rise very quickly. The weakest buyers will have to do with less. As will anyone who chooses to conserve to minimize their energy expense. Balance comes back by necessity. We can all cut 2% if there is a societal pressure to do so, especially if it is backed up by a 30% rise in price.
People like me that were driving 15 yr old rolling wrecks getting 15 MPG will pay for a new vehicle getting 25+. In the last year, I put 170 gallons of gas back into the system or 40% of my prior demand. Others will ditch Ford Excursions for Prius'. Chinese taxi occupants will consider going back to the bike if the choice is gas or food.
Each year the screw will likely turn a little tighter, but there isn't going to be some magic date when a switch is flipped and no one can buy any gas (barring a nuke on Ras Tanura). Some may really suffer in energy hog societies like the US until they move or make other accomodations, but Africans making $200/yr will barely notice. They already pay obscene prices for the little bit of fuel they use. Ditto 900 million of the 1 billion in India and 1.1 billion of the 1.3 billion Chinese.
Over time, our economies will shift to value energy more. We will have to make changes in our lives. But is it really all that awful to have to give up on some of that cheap plastic crap from Walmart? Energy use for fertilizer is not that enormous (and mostly nat gas based anyway). We already pay farmers to grow less and most of our grain production goes to produce meat. Could we all eat meat only 3-5 times a week like my parents did in the 1930-40's? Sure. Probably do us all a world of good. Will food be priced beyond reach? Bah. and the cost of transport to market is a tiny percentage of US transportation energy use.
I just don't see the world meltdown scenario the wild eyed fringe among the peak oilers do.
A water buffalo costs $500 and lives for decades. A tractor for plowing the rice paddies costs $1,500 plus you need to purchase diesel. Easy calculation for the small Thai rice paddy farmer!
That means much oil saved for the Western SUV's now being marketed.
I recently posted this after reading a news item!
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Part of the campaign must be ideological. In Dutch conversation I prefer to refer to the SUV's with the word "PC-Hooft-tractor". The word comes from comedian Yoep van 't Hek. The wording refers to the fact that SUV's can be seen most of the times on the Amsterdam street with the most expensive shops: the PCHooft-straat where they preposterously brake for speed humps! Any English equivalents for this ridiculing description?
The comparison with people dying for shortage of bread is a bit exaggerated (it was not my own btw) but it makes very clear what you are actually talking about when claiming (correctly!) that the price mechanism will take care of shortages.
(I worked for a multinational for a while, for a small enterprise and in education. By incident I drive a car that is rather big and because of its age not very efficient in my view. It takes a litre for a little over 13 km, so that is about 30 miles a gallon )
If you are an Xurban idiot commuting 75 miles one way to town for your job, you will be screwed. That it, until you move back to town or get the job moved to Xurbia. Or ride the bus.....
