The End of the World as You Know It… & the Rise of the New Energy World Order

Dandelion Salad

By Tom Engelhardt
TomDispatch
April 16, 2008

It’s strange that the business and geopolitics of energy takes up so little space on American front pages — or that we could conduct an oil war in Iraq with hardly a mention of the words “oil” and “war” in the same paragraph in those same papers over the years. Strange indeed. And yet, oil rules our world and energy lies behind so many of the headlines that might seem to be about other matters entirely.

Take the food riots now spreading across the planet because the prices of staples are soaring, while stocks of basics are falling. In the last year, wheat (think flour) has risen by 130%, rice by 74%, soya by 87%, and corn by 31%, while there are now only eight to 12 weeks of cereal stocks left globally. Governments across the planetary map are shuddering. This is a fast growing horror story and, though the cry in the streets of Cairo and Port au Prince might be for bread, this, too, turns out to be a tale largely ruled by energy: Too many acres turned over to corn (and sugar cane) for the creation of biofuels; a historic drought in Australia and other climate-change-induced extreme! s of weather — a result of the burning of fossil fuels — that have affected crop yields; and many new middle-class consumers, in China and elsewhere, coming on line, with a growing desire for meat, the production of which is heavily petroleum based.

From resource wars to oil wars (the subjects of his last two books), Michael Klare, Tomdispatch’s energy expert, has long been ahead of the curve when it came to ways in which our planet was being reshaped at the most basic level. Today, he offers Tomdispatch readers a peek into some of the key themes in his staggering new book, Rising Powers, Shrinking Planet: The New Geopolitics of Energy. If you want to grasp the true shape of our shaky world, of where exactly we’ve been and where we might be going, this is a book not to be missed. It offers the profile-in-formation of a shape-shifting planet, a planet in transition and on a road to nowhere pretty. Check out as well, the latest Tomdispatch brief video (produced by TD’s Brett Story) — in which Klare discusses key issues in his new book — by clicking here. Tom

The End of the World as You Know It

…and the Rise of the New Energy World Order

By Michael T. Klare

Oil at $110 a barrel. Gasoline at $3.35 (or more) per gallon. Diesel fuel at $4 per gallon. Independent truckers forced off the road. Home heating oil rising to unconscionable price levels. Jet fuel so expensive that three low-cost airlines stopped flying in the past few weeks. This is just a taste of the latest energy news, signaling a profound change in how all of us, in this country and around the world, are going to live — trends that, so far as anyone can predict, will only become more pronounced as energy supplies dwindle and the global struggle over their allocation intensifies.

Energy of all sorts was once hugely abundant, making possible the worldwide economic expansion of the past six decades. This expansion benefited the United States above all — along with its “First World” allies in Europe and the Pacific. Recently, however, a select group of former “Third World” countries — China and India in particular — have sought to participate in this energy bonanza by industrializing their economies and selling a wide range of goods to international markets. This, in turn, has led to an unprecedented spurt in global energy consumption — a 47% rise in the past 20 years alone, according to the U.S. Department of Energy (DoE).

An increase of this sort would not be a matter of deep anxiety if the world’s primary energy suppliers were capable of producing the needed additional fuels. Instead, we face a frightening reality: a marked slowdown in the expansion of global energy supplies just as demand rises precipitously. These supplies are not exactly disappearing — though that will occur sooner or later — but they are not growing fast enough to satisfy soaring global demand.

Click here to read more of this dispatch.

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One thought on “The End of the World as You Know It… & the Rise of the New Energy World Order

  1. The sky is falling!!!

    “An increase of this sort would not be a matter of deep anxiety if the world’s primary energy suppliers were capable of producing the needed additional fuels. Instead, we face a frightening reality: a marked slowdown in the expansion of global energy supplies just as demand rises precipitously. These supplies are not exactly disappearing — though that will occur sooner or later — but they are not growing fast enough to satisfy soaring global demand.”

    In fact Klare offers no evidence that suppliers are incapable. Certainly at the present, supply is gaining on demand. This article is more alarmist disinformation.

    “The combination of rising demand, the emergence of powerful new energy consumers, and the contraction of the global energy supply is demolishing the energy-abundant world we are familiar with and creating in its place a new world order…This new world order will be characterized by fierce international competition for dwindling stocks”

    More xenophobic fearmongering. Supply is clearly not contracting. Yet more lies.

    “These rising economic dynamos will have to compete with the mature economic powers for access to remaining untapped reserves of exportable energy — in many cases, bought up long ago by the private energy firms of the mature powers like Exxon Mobil, Chevron, BP, Total of France, and Royal Dutch Shell.”

    Yes, “many cases” 3% of proven reserves to be exact.

    “Several of these state-owned firms, including CNPC and India’s Oil and Natural Gas Corporation, are now set to collaborate with Petróleos de Venezuela S.A. in developing the extra-heavy crude of the Orinoco belt once controlled by Chevron. In this new stage of energy competition, the advantages long enjoyed by Western energy majors has been eroded by vigorous, state-backed upstarts from the developing world.”

    More xenophobic claptrap. Western big oil has for decades relied on fees, markups and “spreads” for it’s earnings. They are happy to generate income from transport, refining and retailing. Expansion of supply only reduces their margins. They are happy to let others make these risky development investments. When supply eventually exceeds demand they can pick up these assets for pennies on the dollar from upstarts that depend on higher prices. Oil like any commodity IS cyclical. The history of the industry contains six similar cycles.

    “By all accounts,[???] the global supply of oil will expand for perhaps another half-decade before reaching a peak and beginning to decline.”

    This is nothing more than the gospel according to Klare.

    “Most [any evidence???] energy professionals, however, consider this estimate highly unrealistic. “One hundred million barrels for 2030 is now in my view an optimistic case”

    First he claims that production will peak shortly from the current 85 million barrels, then he claims that one estimation of 100 million barrels in 2030 supports his contention. His readers are required to have an awfully short attention span, though I guess he could be relying on their ignorance of current levels.

    “major energy firms…drill in the deep and difficult waters of the Gulf of Mexico and the Atlantic Ocean. The result? A few more barrels of oil or cubic feet of natural gas at exorbitant prices”

    Actually the production cost of deep water oil is under $25/barrel hardly “exorbitant”. “A few more barrels” is Klare’s terminology for hundreds of billions of barrels.

    “Will energy-deficit states launch campaigns to wrest the oil and gas reserves of surplus states from their control — the Bush administration’s war in Iraq might already be thought of as one such attempt — or to eliminate competitors among their deficit-state rivals?
    The high costs and risks of modern warfare are well known and there is a widespread perception that energy problems can best be solved through economic means, not military ones. Nevertheless, the major powers are employing military means in their efforts to gain advantage in the global struggle for energy, and no one should be deluded on the subject.”

    Here it is Klare who is attempting to “delude” his readers by pretending that the wars in the Middle East are for “control of oil” not wars for greater Israel.

    “What this adds up to is simple and sobering: the end of the world as you’ve known it.”

    Klare uses the words “dire” and “catastrophe” in almost every paragraph throughout the article and finally closes with a baseless Malthusian prognosis.

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