Friday, November 30, 2012

What peak?

Greetings Peaksters

       Well you can argue all day about peak oil.  Is it here?  Is it
soon?  What's oil anyway?   What will the effect be?

           But although the peak oil  situation is still murky, it
seems clear that around 2000, we hit a different peakpeak cheap oil.
  And if we look at how things have changed since then, we can get a
pretty good idea of what to expect.    (only more so)

      After all,  the price of oil had been holding pretty steady
since.....for ever .   And as far as anybody knew, they would continue
forever.   It would go  up a little during wars, then drop back down.
  In fact, here's a weird bit of data:

    '  "Since 1869, US crude oil prices adjusted for inflation
averaged $23.67 per barrel in 2010 dollars "

        But around 2000, demand got ahead of supply, the price rose,
and rose.   Some said it would go to $200!   But around 2008, it
leveled off, Why?  That's all the economy could take.  As the
economists say : "Demand was destroyed."   What's that really mean?
Layoffs, unemployment,  wages growing slower than inflation.

      So what?  What does it mean for the average citizen?   Well now
that we've had a few years, maybe we can see some patterns.

       How about income?    In 2000  median income was about $41k,
(nominal)  by 2011 it was up to  $49k.   Not bad!    Up about 20%
       But if   you adjust for inflation (using the government's very
conservative inflation  numbers )  it looks a little different.
2000- $55K  2011  - $50K.  That's not so good. Down about 10%

  But how about the stuff we buy every day?    . Like gas.    It went
from $ 1.50 to $3.50.    Up 133%!    ooops

        So   this is what happens when oil production  _doesn't_
peak.    I wonder what happens when it does peak?

 Check out  Gail Tverberg  for some other indicators.


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