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Chapter 2 Deteriorating Oil and Food Security

Chapter 2 Deteriorating Oil and Food Security. Yen Ha & Jessica Hallenbeck CORE: Human Population. Part I. Crude Oil. The Demand For Oil. Our society has become an oil-based civilization Cars, trains, planes Urbanization: cities, suburbs

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Chapter 2 Deteriorating Oil and Food Security

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  1. Chapter 2Deteriorating Oil and Food Security Yen Ha & Jessica Hallenbeck CORE: Human Population

  2. Part I Crude Oil

  3. The Demand For Oil • Our society has become an oil-based civilization • Cars, trains, planes • Urbanization: cities, suburbs • There has been an annual increase of about 1% for the world’s demand for oil • 2005-2006= 0.77% increase • 2006-2007= 1% increase • Third straight year that annual growth is less than 2% • The world currently consumes 85.7 million barrels/day in 2007 • The leading country: United States • 1972- 1 bushel of wheat= 1 barrel of oil • 2007- 8 bushel of wheat= 1 barrel http://www.nationmaster.com/graph/ene_oil_con-energy-oil-consumption

  4. Top 25 Countries of Oil Consumption * http://www.nationmaster.com/graph/ene_oil_con-energy-oil-consumption

  5. Annual Growth Rate of Oil • United States • Unchanged within the past three years with an average of 20.7 million barrels/day • China • 5.5% increased from 2006-2007 • Currently consumes 7.7 million barrels/day http://wolf.readinglitho.co.uk/mainpages/consumption.html The huge increases in Asia and China over the last four decades are very clear.

  6. Available Oil • Estimated 2 trillion barrels of oil are available in the world • However, 1 trillion has already been harvested • Easy oil: close to shores, near the surface, large reservoirs • Tough oil: off shores, deep underground, difficult to find • Energy Information Administration of the U.S. Department of Energy estimates that there still are 1.28 trillion barrels of oil reserves available in the world

  7. Available Oil Cont… • Cambridge Energy Research Associates (CERA) have found in 2006 that there is an estimate of 3.74 trillion barrels of oil remaining in the world • This could raise questions of new technologies, geopolitical conflicts, and economics to find these new frontiers http://www.cera.com/aspx/cda/public1/news/pressReleases/pressReleaseDetails.aspx?CID=8444

  8. Measuring the Decline of Oil • Computer Models • Analysis of Reserves and Production Relationship • Separate the World’s Oil Production Countries into 3 groups

  9. Computer Models • Projects future oil production and prices based on the past http://www.eia.doe.gov/steo http://www.eia.doe.gov/steo

  10. Reserves and Production Relationship • Look to see future production trends • M. King Hubbert (US Geological Survey) predicted the production peak based on the time between new discoveries • Used the information that the US had new discoveries in 1930 • Estimated that the US oil production would peak in 1970 http://tonto.eia.doe.gov/dnav/pet/hist/mcrfpus1a.htm

  11. Separating the World • Group 1: Falling production • United States, Venezuela, United Kingdom, Norway • Group 2: Rising production • Russia, Canada, Kazakhstan, Algeria, Angola, Brazil, Nigeria, Qatar, United Arab Emirates, Libya • Group 3: Verge of a downfall in production • Saudi Arabia, Mexico, China

  12. Separating the World cont. • The predictions for many of the countries are true • Countries that have already peaked (US, Venezuela, UK, Norway) • BUT how about… • Saudi Arabia, Mexico,China, Libya • For the most part, categorizing these countries are inaccurate at the true representation of their oil production http://www.worldoil.com/INFOCENTER/STATISTICS_DETAIL.ASP?STATFILE=_WORLDOILPRODUCTION

  13. Problems With Discovering New Oil • 95% of the oil in the world has already been discovered • Due to the lack of exploration and new discoveries suggests that oil companies are agreeing to this fact • Husseini (former head of exploration at Aramco) claimed that it’s impossible to discover enough new oil reserves to compensate for all the oil demand • Need enough to cover the 2 million barrels/day increase of oil demand each year • Also need enough new oil to cover for the declining 4 million barrels/day from old oil reserves • International Energy Agency (IEA) claims that the demands of 2007 (84.75 mbpd) cannot even reach the oil production of 2006 (85.01 mbpd) • Currently, 2007 has produced 85.7 million barrels per day • 18 of the top 20 oil reserves were discovered in the 1970’s • None of the new oil reserves found within the past decade made the top 20 • However, if the CERA is correct in its claims about the 3.7 trillion of oil that still remains means that we have NOT discovered most of the oil available on this earth • Plus, the annual increase of oil consumption has not increased 2 million barrels/day within the past 3 years

  14. Hubbert’s Peak • Utilizes a bell-shaped curve to predict the oil production for the future • Use the patterns seen from 1992-2006 to predict for 2006-2020 • 1992: 67 million barrels/day • 2006: 85 million barrels/day (18 mbpd increase) • 2020: 67 million barrels/day • Would require a 21% drop within this 14 years period • Nevertheless, with an increase of 1% oil consumption annually, we would need to produce 106 million barrels/day to meet the needs of consumers

  15. Critics of Hubbert’s Peak • Jerome R. Corsi: • Argues that we are constantly finding new oil reserves so the idea of us completely running dry of oil by 2050 is impossible • In September of 2006, ExxonMobil claimed that oil in place estimates to about 6-8 trillion barrels per day and 3 trillion barrels per day in oil shale deposits • Others • The peak of 2006 is lower than the oil production of 2008 • Estimates of oil productions are expected to increase within the next years

  16. Actual Hubbert’s Peak • Hubbert’s Peak falls short of prediction • 2006 was not the peak of oil production since production in 2008 has surpassed it • This shifts the prediction curve http://www.theoildrum.com/files/PU200808_Fig3b_0.png

  17. Actual Hubbert’s Peak Cont. http://www.eia.doe.gov/steo Furthermore, the United States is estimated to increase its production within the next two years according to Energy Information Administration - This dramatic decrease in oil production after the peak of 2006 is yet to be seen

  18. Other Options for Oil • The remaining 5% of the oil is in the Artic • Which country controls which parts? • Problems: • Wars, environmental regulations, devastation to the ecological systems • Tar sands—products of oil shale • Canada has an estimate 1.8 tbpd but only 300 bbpd can be recovered • Venezuela has 1.2 tbpd but only 400 bbpd can be recovered • Problems: • Extremely hazardous to the environment: heating, need lots of natural gas, carbon-intensive • 2 tons of sand= 1 barrel of oil • Extremely costly: takes 2 barrels out of 3 barrels to pay for the costs

  19. Other Options Cont… • Oil Shale: conversion of kerogen, an organic material, into oil and gas • Colorado, Wyoming, Utah • Problems: • Requires several barrels of water= one barrel of oil • Very costly, climate destruction, time

  20. Problems with Declining Oil • High demand and low supply • IEA estimates that by 2030, we will need 120 million barrels/day to meet our consumer needs in the US • We do not change • Industries still continues to make cars, airplanes, food, ect. as if the oil will continue to last http://www.marktaw.com/culture_and_media/politics/GlobalOilImages/productionandconsumption.gif

  21. Problems Cont… • Growth of modern cities • 400 cities, 20 mega cities with more than 10 million people • Requires lots of oil for transportation, operation of large buildings, new technologies, ect. • Garbage—needs to go longer distances as the cities grow larger which requires more oil and higher costs • Suburbs • People need to commute to work • Highly dependent in the US where most people still transport using cars rather than public transits • Shopping malls, Wal-Marts, roads • Bottom line • INC in oil prices= INC in cost of food= INC in everything else • Without oil, we will no longer be able to travel far distances, get fresh produces, and have our luxurious lifestyles

  22. Reality of Oil Consumption http://maps.grida.no/go/graphic/world_oil_consumption

  23. Part II Food and Oil Since 1950

  24. Cheap Oil Boosts Food Production • World grain harvest quadrupled last century. • 1950-1972: 1 bushel of wheat =1 barrel of oil on the world market = $2 • 2007: 8 bushels of wheat = 1 barrel of oil

  25. "What is driving oil prices so high?", BBC (November 5, 2007). • When oil >$60, becomes cheaper to convert food crops to oil

  26. World Grain Harvest • 1950: 630 million tons • Now: 2 billion tons • Productivity (with little new land) tripled due to: • Tripling of Irrigation • 10 times more fertilizer used • High yield crops • Hybrid corn in US • Dwarf wheat and rice in Asia

  27. World farmland • According to satellite imagery, 15 million km2 of farmland in 2000. • New farmland has been created, but much farmland is lost to urbanization and overuse.

  28. 2006: In US, 16% food crops to oil In 2008, 30% use projected by Lester Brown 2007: According to the USDA projections the share of ethanol in total corn use will rise from 14% in 2005/06 to 31% in 2016/17. Food prices are going up to equal oil prices

  29. Image fromNew York Times Jan 19, 2008.

  30. Grain Exporters/Importers Image from Theoildrum.com

  31. Grain 1984: 342 kilograms grain/person 2006: 302 kg/person Why was there no worldwide famine? Soybean 1984: 68 million tons 2007: 222 million tons Food vs. Population

  32. US Agriculture Energy: • 19% farm energy to pump water. • 2/3 of agriculture energy used by transportation. • 7% of agriculture energy used in packaging –more energy for packaging than the food contains.

  33. Refrigeration • Refrigeration uses the most energy in the food industry. • Energy Star models use 50% less energy than those made before 1993. • Up to 4kWh per day. Image from wikipedia.com

  34. The US has become more energy efficient

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