A World That Just Doesn’t Need As Much Oil

Written By: - Date published: 7:22 am, June 18th, 2020 - 27 comments
Categories: capitalism, climate change, energy, Environment, global warming, peak oil, uncategorized - Tags:

BP yesterday sent a really big message that effectively now, Covid-19 is the break that tips the world away from oil dependence.

They advised investors that the economic shock of the pandemic would reverberate for years, and that less oil and gas would likely be needed.

And they are writing down as much as US $17.5 billion of their petroleum holdings next quarter.

Bernard Looney their Chief Executive said in February that “Everywhere I have been – inside BP, as well as outside – I have come away with one inescapable conclusion: we have got to change.”

All those who disinvested were right.

All those who warned us were right.

27 comments on “A World That Just Doesn’t Need As Much Oil ”

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  1. Robert Guyton 1
    18 June 2020 at 8:22 am

    Good.

    • weka 1.1
      18 June 2020 at 10:07 am

      'bout time too. Maybe we can all talk about energy descent now.

      • froggleblocks 1.1.1
        18 June 2020 at 10:16 am

        Energy descent means lower standards of living. Good luck trying to have that conversation in any sort of rational way.

        [Name and e-mail don’t match with previous records and this is creating work for Moderators and is holding up your comment in Pre-Moderation – Incognito]

        • Incognito 1.1.1.1
          18 June 2020 at 12:27 pm

          See my Moderation note @ 10:16 AM.

        • weka 1.1.1.2
          18 June 2020 at 2:58 pm

          Energy descent means lower standards of living. Good luck trying to have that conversation in any sort of rational way.

          It might if by lower standard of living you mean not being able to buy a new iphone every few years. If you mean living a good, satisfying, safe life, then no it doesn't. It also acknowledges that some people's standard of living needs to and can improve, via just transition.

          But sure, we can keep delaying the conversation until it is too late.

          • RedLogix 1.1.1.2.1
            18 June 2020 at 3:25 pm

            If you mean living a good, satisfying, safe life, then no it doesn't.

            That is an assertion you need to prove.

            In every instance I can think of, where we see communities (at any scale, local or national) either voluntarily or compelled, go through an energy decline there are real constraints on the standard of living they can achieve independently.

            They never exist in a vacuum, they are always embedded in a wider industrial society that still provides the essential security, transport, educational and health infrastructures in the background.

            For instance, no matter how 'transitioned' you are, if you need a wisdom tooth removed it would be a very poor thing indeed not to have available a dental surgeon able to deal with it safely. Yet just that function alone is absolutely dependent on a myriad of industrial materials and services that would be unlikely to exist in a de-powered post industrial society. (Except perhaps to the most wealthy.)

            I've said this before, in no fashion am I against moving toward styles of living that are less profligate and a lot more conscious about our use of resources. I've visited numerous alternative communities over the years, and I'm rather fond of them. But I'm not blind to their limitations either.

            • Drowsy M. Kram 1.1.1.2.1.1
              18 June 2020 at 4:07 pm

              "If you mean living a good, satisfying, safe life, then no it doesn't."

              "That is an assertion you need to prove."

              Can't speak for anyone else, but that assertion rings true to me. Can 'we' continue with what we've got (now) and live a good, satisfying, safe life? I certainly can. Sometimes I believe that many, many people are so enamoured of increasing convenience and conspicuous consumption that it blinds them to the fact that such convenience and consumption became unsustainable (and unsafe in the longer term) decades ago. Indeed, such convenience and consumption may be harmful to present and future (growing) generations.

              And yet many parents are driven to provide their children/child (yes, birth rates are decreasing; hooray!) with more and better opportunities than they had. Why might that be? Are their own lives so awful? Are there no other paths to happiness?

              Are We Approaching a Sustainable Consumption Transition?
              "Public policies, commercial prerogatives, and other inducements have encouraged construction and occupancy of ever-larger homes and this pattern has persisted in the face of decreasing household size, declining fertility, ageing populations, and increasing complexity of domestic relationships. This situation has created a perverse mismatch between available housing stocks and residential requirements."
              https://www.tandfonline.com/doi/full/10.1080/14036096.2020.1722218

              Healthy and Sustainable Diets and Food Systems
              "The Sustainable Development Goals (SDGs) are considered a unifying global goal setting agenda that every country is meant to achieve. One of those goals, SDG2, promises to ensure food security and nutrition within sustainable food systems. However, achieving that goal is riddled with uncertainty because of the way in which the world currently produces and consumes foods. The global trends of diets and the food systems that produce those diets suggest that they are neither healthy nor sustainable, which has implications for achieving SDG2."
              https://link.springer.com/article/10.1007/s41055-019-00052-6

              "Without population reduction, this study predicts an agricultural crisis beginning in 2020, becoming critical c. 2050."
              https://en.wikipedia.org/wiki/Sustainability_measurement#Growth-based_economic_models

        • Draco T Bastard 1.1.1.3
          18 June 2020 at 8:40 pm

          Energy descent means lower standards of living.

          No it doesn't.

          As an example Europe doesn't use anywhere near as much energy per person as the US but, arguably, has better living standards.

          What energy descent really means is to move to living within our means.

          • froggleblocks 1.1.1.3.1
            18 June 2020 at 9:18 pm

            Except we're not talking about reducing energy usage to European levels. We're talking about reducing energy usage to North Korean levels (or even lower).

            And a lot of North Koreas technology relies on outside countries with much higher energy use and GDP than North Korea themselves have – for example you can buy iphones in North Korea.

            If every country in the world had the same energy intensity as North Korea does today, then iphones wouldn’t exist for anyone.

            • Draco T Bastard 1.1.1.3.1.1
              18 June 2020 at 10:15 pm

              We're talking about reducing energy usage to North Korean levels

              Where has that been said?

              • froggleblocks …
                19 June 2020 at 8:23 am

                Well, you tell me. How much energy do you think we'll be getting from oil when the oil industry shuts down?

                That is what this post is about and what weka is continually argueing in favour of.

                • Draco T Bastard …
                  19 June 2020 at 1:31 pm

                  Ah, you're of the delusional belief that energy only comes from oil.

                  As a reminder – most of NZ's electricity comes from sustainable energy sources which can easily be ramped up to cover the minor amount that comes from unsustainable sources.

                  • Enough is Enough …
                    19 June 2020 at 1:37 pm

                    Draco

                    Where have you been hiding?

                  • froggleblocks …
                    19 June 2020 at 7:12 pm

                    Yes, only a 'minor' amount of NZ's energy comes from fossil fuels. Sure.

                    • roblogic …
                      20 June 2020 at 1:55 pm

                      Yep, road transport alone consumes about 3x the energy produced by the NZ electric grid. We would need several nuclear power plants to completely replace oil. But we aren't doing that, instead we're *reducing* the amount we burn

  2. RedLogix 2
    18 June 2020 at 9:44 am

    I regularly listen to this channel Breakthrough Institute who I find take a good balanced position on energy issues.

    This latest webinar looks in particular how subsidies and their impact on decarbonisation.

    Breakthrough has long argued that fighting climate change is mainly a matter of making clean energy cheap, and — thanks in large part to federal deployment subsidies — this is precisely what we've done for solar and onshore wind technologies. But since experts agree that they aren’t enough to fully decarbonize today's electric power grids, we need to focus subsidies on emerging sources of firm generation like advanced nuclear, while also investing in the energy storage and transmission infrastructure we need to support more solar and wind. The next few years mark a potential inflection point in the evolution of America's electric system. Smart action now will enable faster, cheaper decarbonization in the future.

  3. roblogic 3
    18 June 2020 at 11:40 am

    A convergence is coming. Incremental changes in green tech are slowly building up to make electric vehicles a cheaper option than oil combustion. Tesla's new "million mile battery" will not only power cars, it could supply power back to the grid in times of high demand. Simpler designs and build techniques are making Tesla the world's most valuable car manufacturer.

    • Kevin 3.1
      18 June 2020 at 2:32 pm

      Second only to Toyota now.

      Not bad after being less than 30 days from bankruptcy in 2008.

      • Phil 3.1.1
        18 June 2020 at 4:44 pm

        …Tesla the world's most valuable car manufacturer.

        Honestly, it absolutely baffles me that Tesla is in this position. They're now producing 400-500 thousand cars per year (Toyota produce upward of 8-and-a-half million per year and have consistently since 2013), they haven't turned a 12-month- rolling profit in a decade of operation and they have a truly shitty record of delivering new lines to their publicly stated timetable.

        Literally everything about this company screams Dot-Com bubble.

        • Andre 3.1.1.1
          18 June 2020 at 4:56 pm

          Part of it is that Tesla isn't just a car manufacturer. With their Supercharger network, Powerwall and solar roof product lines, grid-scale battery systems etc they're on the way towards being more of an energy ecosystem company.

          But yeah, most of the irrational exuberance in their market valuation seems to be driven from the automotive side.

        • lprent 3.1.1.2
          18 June 2020 at 6:04 pm

          They have produced technically good and very innovative vehicles at progressively lower costs. Neither something to be sneezed at.

          They have managed to sell all (as far as I can find out) of their vehicles at an operational profit. Again something that is not to be sneezed at.

          They have steadily increased their sales throughout their history.

          None of these things bear any relationship to 90s dot-com style companies.

          they haven’t turned a 12-month- rolling profit in a decade of operation

          That is pretty common with an organisation that is rapidly increasing capacity and innovating. Capacity like massive battery factories producing some of the highest capacity batteries known.

          One of the characteristics of the dot-com companies was that they didn’t have any tangible assets, and in many ways it was hard to argue that they even had much technical intellectual property..

          I’d say that your analogy is pretty useless. A better comparison would be to look at the early 19th century major car manufacturers as they started to put out cars in competition to horses. It took them decades to increase capacity and they didn’t have realisable profits for decades as well.

        • Stunned Mullet 3.1.1.3
          18 June 2020 at 6:30 pm

          If this is real expect their share price to increase even more..

          https://www.cnet.com/roadshow/news/tesla-million-mile-battery-production-catl/

  4. sumsuch 4
    18 June 2020 at 11:33 pm

    Why is my fill up still over $100 in the light of cheap oil? Surely there should have been a tangle in the press?

    • roblogic 4.1
      20 June 2020 at 1:57 pm

      Like every other sector of the NZ economy, the market is sewn up by insiders and Kiwis are getting screwed

    • Andre 4.2
      20 June 2020 at 2:20 pm

      Because taxes and various importer and reseller margins have always been a big part of the price of fuel here.

      When oil prices are as low as they are now, the oil component is tiny, maybe around 30 or 40 cents per litre, but the all the fixed costs of refining, transport etc are still there.

      Plus the various companies seem to be making a bit more margin than usual at the moment.

      https://www.stuff.co.nz/motoring/120910357/fuel-prices-continue-to-fall