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Art: Edward Hopper

Whether oil scarcity is a result of peaking or plateauing, one affected sector not on many people’s minds is health care. Orion magazine published an article on the issue in its July/August edition under the title “Medicine After Oil” in which Daniel Bednarz not only highlights the important role oil plays in our Western health care system but also proposes a new system for a world after oil dependence.

“Petrochemicals are used to manufacture analgesics, antihistamines, antibiotics, antibacterials, rectal suppositories, cough syrups, lubricants, creams, ointments, salves, and many gels. Processed plastics made with oil are used in heart valves and other esoteric medical equipment. Petrochemicals are used in radiological dyes and films, intravenous tubing, syringes, and oxygen masks. In all but rare instances, fossil fuels heat and cool buildings and supply electricity. Ambulances and helicopter “life flights” depend on petroleum, as do personnel who travel to and from medical workplaces in motor vehicles. Supplies and equipment are shipped—often from overseas—in petroleum-powered carriers. In addition there are the subtle consequences of fossil fuel reliance. A recently retired doctor [informed Bednarz], “In orthopedics we used to set fractures mostly by feel and knowing the mechanics of how the fractures were created. I doubt that many of the present orthopedists could do a good job if you took away their [energy-powered] fluoroscope or X-ray.”

America has a shocking health system, with premium (”Ferrari”) care provided to those who can afford it, and a “jalopy model” serving the over 50 million un- and underinsured who very often receive no treatment, defer treatment until their condition cannot be ignored, or face economic ruin when they seek adequate care. With rising prices for oil, this number will swell, moving health care more and more out of reach for ordinary citizens - and not just in the US. Worldwide people in the so-called developed world could join ranks with those in the majority world and experience ill health in epidemic proportions.

The solution Bednarz promotes is an obvious one: moving away from treatment medicine to giving priority to public health strategies, in particular prevention of disease and promotion of health within the population as a whole. “Typically accomplished through the diffusion of information, low-cost therapies, and the promotion of healthful nutrition and lifestyle, preventive medicine allows people to avoid or postpone disease, and to stay clear of the costliest and most energy-intensive sectors of the medical system—doctors’ offices, pharmacies, and the hospital.”

Unlike the much more elitist treatment based model, public health care is “inherently egalitarian - if the entire community is not protected, then no one’s health is assured”. In addition: even though public health is overburdened and underfunded (receiving in the US about 5 percent of health-care dollars, with the balance going to treatment medicine and to biomedical research), it nevertheless exists and does not have to be reinvented. “Public health workers, for example, educate about and test for HIV/AIDS and other sexually transmitted diseases; they interdict infectious diseases like avian flu; they create emergency plans to deal with a variety of disaster scenarios; they monitor waste management and air and water quality”. All that is needed to meet the health-care challenges of the coming energy transition, or, for that matter, those of climate change, is to re-prioritise health policy strategies.

The question that Bednarz doesn’t address though in this context is how the medical establishment will react to such transformation. He mentions some ‘public health’ officials are beginning to address possible oil scarcity’s effect on health care, but there is no hint on how such changes would be greeted by the traditional medical establishment that monopolises the health system, with a lot of its privileges, status and defensive ideologies at stake. Such concerns though are based on our current environment; the ‘after-oil world’ will be a totally new one, with very different dynamics, worldviews and also chaos that could lead to all kinds right now unpredictable outcomes. One of those could indeed be a more just and democratic society, one which, amongst other things, successfully promotes health and wellbeing for all people. The latter certainly is Bednarz’s hope - and mine.

One thing I didn’t mention in a previous post is the cost of war, which adds enormous amounts of money to the already heavy financial burden of the average American family and therefore to the pressures on a struggling US economy - apart of course from the much greater sacrifices the people in Iraq and Afghanistan are making in wars forced upon them. Nation Editor Katrina vanden Heuvel reflects on the staggering economic, as well as human, costs of war.

Based on an article by Russell Gold and Ann Davis in The Wall Street Journal via Dow Jones Newswires, Nov 19, 2007

A growing number of oil-industry chieftains such as Christophe de Margerie, the chief executive of French oil company Total SA, James Mulva, the chief executive of ConocoPhillips, and Sadad Ibrahim Al Husseini, a former head of exploration and production at Saudi Arabia’s national oil company, are endorsing an idea long deemed fringe: The world is approaching a practical limit to the number of barrels of crude oil that can be pumped every day. Some predict that, despite the world’s fast-growing thirst for oil, producers could hit that ceiling as soon as 2012. This rough limit — which two senior industry officials recently pegged at about 100 million barrels a day — is well short of global demand projections over the next few decades. Current production is about 85 million barrels a day.

The world certainly won’t run out of oil anytime soon. And plenty of energy experts expect sky-high prices to hasten the development of alternative fuels and improve energy efficiency. But evidence is mounting that crude-oil production may plateau before those innovations arrive on a large scale. That could set the stage for a period marked by energy shortages, high prices and bare-knuckled competition for fuel.

The current debate represents a significant twist on an older, often-derided notion known as the peak-oil theory. Traditional peak-oil theorists, many of whom are industry outsiders or retired geologists, have argued that global oil production will soon peak and enter an irreversible decline because nearly half the available oil in the world has been pumped. They’ve been proved wrong so often that their theory has become debased.

The new adherents, who range from senior Western oil-company executives to current and former officials of the major world exporting countries, don’t believe the global oil tank is at the half-empty point. But they share the belief that a global production ceiling is coming for other reasons: restricted access to oil fields, spiraling costs and increasingly complex oil-field geology. This will create a global production plateau, not a peak, they contend, with oil output remaining relatively constant rather than rising or falling. And these are the arguments to support their view:

• production forecasts by the International Energy Agency of 102.3 million and 120 million barrels a day by 2030 are seen as unrealistic; to even achieve 100 million barrels a day by that date is viewed as “difficult”
• many existing oil fields are being depleted at rates that will damage their geologic structures, which will limit future output more than most people allow
• some nations endowed with large untapped pools of oil are generating so much revenue from their current production that they feel they don’t need to further develop their fields, thus putting another cap on output
• the industry does not have enough engineers to ramp up production fast enough to keep up with the thirsty global economy; during the years of low or moderate oil prices in the 1980s and 1990s, companies didn’t develop enough geologists and other skilled workers to supply today’s needs, which has led to a limited and aging pool of skilled workers
• one of the largest obstacles is the booming commodity markets themselves: prices of raw materials used in oil-field platforms and equipment has escalated
• high oil prices too led to steep cost inflation for drilling rigs and other equipment, seeing the industry falling behind in the investment needed to sate expected future demand (to meet demand forecasts of 90 million barrels of oil a day in 2010, the industry needed to have spent $350 billion on drilling and producing in 2005, but the International Energy Agency estimates that spending on oil-field production in 2005 came to only about $225 billion)
• many people think most of the world’s giant fields already have been discovered; by 1970, oil-industry explorers had discovered 10 giants that could each produce more than 600,000 barrels a day; exploration in the next 20 years, to 1990, yielded only two; since 1990, despite billions in new spending, the industry has found only one field with the potential to top 500,000 barrels a day, Kazakhstan’s Kashagan field in the Caspian Sea, and it is proving expensive and difficult to extract
• most of the world’s biggest fields are aging, and production at them is declining rapidly; just to keep global production at current levels, the optimistic view is that the industry needs to add new production of at least four million daily barrels, every year, roughly five times the daily production of Alaska, with its big Prudhoe Bay field, without assuming any demand growth at all; a more realistic rate of decline seems to be 8% to 10% a year, especially because modern technology actually succeeds in depleting fields faster (meaning the industry needs to add new daily production of at least eight million barrels to stay even, 10 times current Alaskan production)
• new discoveries are tending to be smaller and more complex to develop
• above-ground risks like resource nationalism (tightening state control of oil fields to achieve political aims), limited access and infrastructure constraints may make it feel like peak oil just the same; some of the most promising geological formations are in locations that are inhospitable, for reasons of geography or clouded by geopolitical and local instability (e.g.Iraq, Iran and Nigeria)

Many leaders of the industry such as BP’s chief executive, Tony Hayward and Exxon Mobil Corp. Chief Executive Rex Tillerson still dismiss the idea that there is reason to worry; they believe for example that the industry would be able to raise fuel production to meet demand in 2030 of 116 million barrels a day. U.S. government experts too are optimistic — to a point. The Energy Information Administration, the data arm of the Energy Department, forecasts world oil production will hit 118 million barrels a day by 2030. But the agency warns that its prediction might not pan out if resource-rich nations such as Venezuela and Iraq don’t invest enough in their operations.

The oil industry has long been beset by doom-and-gloom scenarios, which so far haven’t panned out. “The entire oil industry in the late 1970s was convinced the price [of oil] would be $100 by 1990 and we would need huge oil shale mines” to exploit oil locked away tightly in rock, says Michael C. Lynch, president of Strategic Energy & Economic Research Inc. Of course, that didn’t happen, as discoveries ushered in new eras of low-priced oil in the mid-1980s through the late 1990s.

Two or three years ago, it was far more common for oil analysts and officials to trumpet the potential of new technology to harvest more oil. In a report last year, Cambridge Energy Research Associates, a prominent adviser to energy companies, made the comforting prediction that oil production could reach 110 million barrels a day by 2015, and “more than meet any reasonable high growth rate demand scenario we can envisage” up to that date. Because of progress being made in extracting oil through new methods, CERA said it found “no evidence” there would be a peak in oil flows “any time soon.” In a later report, CERA said world oil production won’t peak before 2030 and that even when it does, production will resemble an “undulating plateau” for one or more decades before declining gradually.

Oil executives who believe a production ceiling is coming are making plans to stay relevant in a world where oil production is constrained. Mr. de Margerie said at Total’s annual meeting this spring that the company was “looking into” nuclear-industry investments and had hired nuclear experts to help make strategic decisions. ConocoPhillips recently said it was considering building a commercial-scale plant to turn plentiful U.S. coal into natural gas.

Soaring energy prices have also breathed new life into projects targeting “non-conventional” oil, such as that trapped in sand or shale. But these sources can’t be tapped nearly as quickly or inexpensively as the big oil finds of the past. Canada’s massive oil-sands deposits, which hold the largest oil reserves after Saudi Arabia’s, offer a vivid example. They contain an estimated 180 billion barrels of oil. But after years of intensive development and tens of billions of dollars of investments, the sands are producing only a little more than 1.1 million barrels of crude a day. That’s projected to reach three million a day by 2015. The oil deposits are so heavy that companies must either mine them or slowly steam them underground to get the oil to flow out of the sand. Randy Udall, co-founder of the U.S. chapter of the Association for the Study of Peak Oil and Gas, has written that these unconventional oil supplies are like having $100 million in the bank, but “being forbidden to withdraw more than $100,000 per year. You are rich, sort of.”

As these uncertainties mount, there is growing hope that Saudi Arabia, which has about 20% of the world’s oil reserves, would ride to the rescue if needed. Saudi Aramco, the national oil company, has embarked on an ambitious plan to increase its daily production by 30%, or three million barrels, early next decade, and thus reclaim the title of top producer from Russia. But Mr. Al Husseini, the former Saudi oil executive, now an independent consultant, said others aren’t doing as much, leaving the world entirely dependent on Saudi Arabia to provide extra capacity. “Everyone thinks that Saudi Arabia will pull us out of this mess. Saudi Arabia is doing all it can,” he says in an interview. “But what it is doing, in the long run, won’t be enough.”

By Paul Eccleston
Telegraph.co.uk, 22/11/2007

Richard Heinberg, one of the world’s leading experts on oil reserves, warned that the lives of billions of people were threatened by a food crisis caused by our dependence on dwindling supplies of fossil fuels.

Higher oil prices, the loss of farmland to biofuel crops, climate change and the loss of natural resources would combine with population growth to create an unprecedented food shortage, he claimed.

The only way to avoid a world food crisis was a planned and rapid reduction of fossil fuel use - oil, coal and gas - and a switch to more organic methods in the growing and delivery of food. It would mean a return to living off the land not seen for 150 years.

The stark predictions were made by Heinberg in a lecture to the Soil Association in London.

Heinberg, an author and former advisor to the National Petroleum Council, specialises in ‘Peak Oil’ - the point where oil production reaches its maximum and begins to decline - and the implications it has for climate change and food security.

He said for thousands of years, until the 19th century and the onset of the Industrial Revolution, all food production had been local. In good years there was enough to eat and to store and in bad years there was starvation.
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The invention of the petrol engine increased the amount of arable land available to grow food, the size and efficiency of farm machinery improved, and better pesticides were developed - all of which contributed to a better food supply.

As food became more plentiful and cheap, the threat of famine disappeared and obesity became more widespread than hunger. Food, grain, meat and vegetables began to be exported around the world and the world population increased six-fold.

By the 1960s industrial-chemical practices had been exported to the third world and in the next half century food production tripled - but at an unrecognised cost of water and soil pollution and enormous environmental damage.

Heinberg said that, unfortunately, it was all unsustainable and the abundance of food depended on depleting, non-renewable fossil fuels whose burning produced climate-altering carbon dioxide.

The depletion of oil stocks, the demand for biofuels as an alternative, environmental degradation and extreme weather caused by climate change, were coming together to pose massive problems for world food production.

The situation would be made worse by a shortage of fresh drinking water. According to UN estimates, one third of the world’s population lived in areas with water shortages and 1.1 billion people lack access to safe drinking water. The situation was expected to worsen dramatically over the next few decades.

While the human population had tripled in the 20th century, the use of renewable water resources had grown six-fold.

The UN Environment Program had concluded that the planet’s water, land, air, plants, animals and fish stocks were all in “inexorable decline” much of it due to agriculture, which constituted the greatest single source of human impact on the biosphere.

Heinberg said that to get to the heart of the crisis a comprehensive transformation of world agriculture was needed - greater than anything seen in many decades - which would produce a system that was not reliant on fossil fuels.

He cited Cuba as an example of what could be achieved. In the 1980s it had become reliant on cheap fuel supplied by Russia and was using more agrochemicals per acre than even the US. But after the fall of communism, supplies dried up. The average Cuban lost 20lbs in weight, living standards collapsed and malnutrition became widespread.

Cuban authorities responded by redesigning the food supply system. Large state-owned farms were broken up and given to families and they were encouraged to form co-operatives, biological methods were used for pest control, oxen replaced tractors, urban vegetable gardens flourished and people began to keep chickens and rabbits for food. Twenty years later food production was 90 per cent of its former levels.

Heinberg said what was needed was a return to ecological organic farming methods which would require the transformation of societies.

And with oil supplies rapidly running out the full resources of national governments would be needed to achieve it.

The amount of food transportation would have to be reduced, food would need to be grown in and around cities, and producers and consumers would need to live closer together.

The use of pesticides would have to be reduced in packaging and processing, draft animals would be reintroduced and governments would have to provide incentives for people to return to an agricultural life. Land reform would be needed to enable smallholders and farming co-ops to work their own plots and population growth would have to be curbed.

“All of this constitutes a gargantuan task, but the alternatives - doing nothing or attempting to solve our food-production problems simply by applying mere techno-fixes - will almost certainly lead to dire consequences,” he said.

” All of the worrisome trends mentioned earlier would intensify to the point that the human carrying capacity of Earth would be degraded significantly, and perhaps to a large degree permanently.”

Heinberg added: “The transition to a fossil-fuel-free food system does not constitute a distant utopian proposal. It is an unavoidable, immediate, and immense challenge that will call for unprecedented levels of creativity at all levels of society.

“A hundred years from now, everyone will be eating what we today would define as organic food, whether or not we act.

“But what we do now will determine how many will be eating, what state of health will be enjoyed by those future generations, and whether they will live in a ruined cinder of a world, or one that is in the process of being renewed and replenished.”