Peak oil used to be about running out of supply; now some think that we will run out of demand. The oil companies will ensure that we never run out of demand.
Remember Peak Oil? It was all over TreeHugger, the idea that the easy oil was going to start running out and it would get more and more expensive and difficult to find.
Then along came hydraulic fracturing (fracking), tight oil, deepwater drilling, Trump, Zinke and Pruitt, and the oil and gas are flowing freely and people are piling into pickups. Peak oilman King Hubbert became "a punchline rather than a visionary." And now, over at the NRDC, Jeff Turrentine asks Could Peak Oil Demand Be Just a Dozen Years Away? But he isn't talking about oil supply, he is talking demand, suggesting that electric cars are going to cause a different kind of peak.
In this very different type of forecast, oil production doesn’t necessarily begin to decline at a particular point. But our need for it does. And it’s not just a theory: Experts on all sides of the issue say that it’s really coming. At some point over the next 25 years, a number of cultural, political, and technological factors will combine to slake our global thirst for this once most essential of fossil fuels. After decades spent planning for scarcity, oil companies are now busily preparing for something that they never saw coming: their own marginalization.
To be fair, I thought the same thing two years ago, writing Sooner than you think? A prediction that electric cars will cause the next oil crisis. They don't have to take over the market totally, just enough to tip supply of oil up over demand, like fracking did. But I suspect that the NRDC is being over-optimistic about oil company marginalization.
We wrote earlier about how the oil industry isn't taking this lying down, and is seriously pivoting to plastic. They are investing US$180 billion to increase plastic production by 40 percent.
Plastics and plastic packaging are an integral and important part of the global economy. Plastics production has surged over the past 50 years, from 15 million tonnes in 1964 to 311 million tonnes in 2014, and is expected to double again over the next 20 years, as plastics come to serve increasingly many applications.
They note that the recycling rate is low and that most plastic goes into single-use packaging.
More than 40 years after the launch of the first universal recycling symbol, only 14% of plastic packaging is collected for recycling. When additional value losses in sorting and reprocessing are factored in, only 5% of material value is retained for a subsequent use. Plastics that do get recycled are mostly recycled into lower-value applications that are not again recyclable after use. The recycling rate for plastics, in general, is even lower than for plastic packaging, and both are far below the global recycling rates for paper (58%) and iron and steel (70–90%). In addition, plastic packaging is almost exclusively single-use, especially in business-to-consumer applications.
A ridiculous amount of it ends up in the ocean.
Each year, at least 8 million tonnes of plastics leak into the ocean – which is equivalent to dumping the contents of one garbage truck into the ocean every minute. If no action is taken, this is expected to increase to two per minute by 2030 and four per minute by 2050. Estimates suggest that plastic packaging represents the major share of this leakage. The best research currently available estimates that there are over 150 million tonnes of plastics in the ocean today. In a business-as-usual scenario, the ocean is expected to contain 1 tonne of plastic for every 3 tonnes of fish by 2025, and by 2050, more plastics than fish (by weight).
As we have noted before, plastics are solid fossil fuels and have a huge carbon footprint in their production.
The production of plastics draws on fossil feedstocks, with a significant carbon impact that will become even more significant with the projected surge in consumption. Over 90% of plastics produced are derived from virgin fossil feedstocks. This represents, for all plastics (not just packaging), about 6% of global oil consumption, which is equivalent to the oil consumption of the global aviation sector. If the current strong growth of plastics usage continues as expected, the plastics sector will account for 20% of total oil consumption and 15% of the global annual carbon budget by 2050.
Where I think Jeff Turrentine at the NRDC gets it wrong is that the oil companies are full of very smart people who will find many ways to keep drilling and pumping oil and gas. They will continue to fund politicians who will try to stop renewables and promote gas-fired electric power. They will figure out how to make everything out of plastic.
I suspect that we will be hearing a lot more about hydrogen cars too; the fossil fuel companies might well fund a fake "hydrogen economy" because the cheapest hydrogen is made by steam reforming of natural gas; people think that this is somehow better than just running a car on CNG. As for the implications of all this for climate change, they just don't care. I suspect that it will be a long time before we reach this new Peak Oil Demand; they will just keep inventing ways to keep us hooked.
More to follow on what we can do about plastics from the New Plastics Economy.