The three peaks

G Magazine

We have a tendency to treat our home planet like there’s no tomorrow. But it’s time to wake up to the three-pronged resource crisis – shortages of oil, water and food – that experts say lies just around the bend.


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We’ve been hanging around the land and oceans of this 4.5 billion-year-old planet for the best part of 200,000 years – all the while, we Homo sapiens have found enough food and water to survive.

In recent centuries, however, some have ‘survived’ in a more extravagant manner than others. It is not news that, for many decades, there have been grave fears we have been leaning too heavily on Earth’s 149 million square kilometres of land and 361 million square kilometres of water.

The industrial revolution provided a spark that ignited some positive changes in health, material wealth and human ingenuity in what is now the developed world. Yet for the most part, the progress has come at a cost – with accelerated rates of extinction of flora and fauna, the degradation of biodiversity, depletion of resources and changes to the Earth’s climate systems.

The world population is now approaching seven billion people and it’s estimated there will be in the region of two billion more of us on the planet before 2050. Put this together with the varied impacts of climate change and it presents some fundamental questions for the future.

Will there be enough affordable and healthy food to feed us all without more of the planet’s population facing famine? Can we lessen our reliance on cheap oil quickly enough before it becomes prohibitively expensive? Will there be enough clean fresh water to drink, grow crops and keep rivers healthy and, if there is, will everyone have an equal right to access it?

“There is no doubt about the major challenge for the next generation,’‘ says Ove Hoegh-Guldberg, director of the University of Queensland’s Global Change Institute.

“Soaring human populations are rapidly depleting the key essentials of life, be they food, water or oil.  Along
with our rapidly changing global climate, the next generation of thinkers and doers will have to solve the peak resource issue or face almost certain global calamity.”


If money does make the world go round then it can be said much of that money is spent on oil to keep the globe’s wheels spinning. Currently about 85 million barrels of ‘Texas tea’ are used every day to move people and products across land, skies and oceans and to provide energy.

From transport fuel to plastics production and even most face moisturisers, we rely on oil for an incredible variety of everyday materials and activities. Of these, transport is the most significant. When oil prices rise, the ripples can be felt in everything from the price of a loaf of bread to geopolitical tensions across continents and economies.

Peak oil “refers to the maximum rate of the production of oil in any area under consideration, recognising that it is a finite natural resource, subject to depletion”, according to the international Association for the Study of Peak Oil and Gas (ASPO).

In understanding the concept, it’s important to note that no one is predicting the world will run out of oil entirely – but that our supplies of conventional oil that are cheap and easy to access are going down the gurgler fast.

Kjell Aleklett, international president of ASPO, says in the 1960s the world was discovering about 48 billion barrels of oil per year (BPY) but only consuming eight billion. “Since then there has been a decline in the discovery rate where we are down to something like 10 billion BPY but the consumption has gone up to 30 billion, which means we have a deficit,” he says.

A 2010 US Department of Defense report advised that, without a “massive expansion of production and refining capacity” of oil, a “severe energy crunch” is inevitable. This would, at best, lead to “periods of harsh economic adjustment”.

Analysts have yet to reach consensus on when production from the world’s conventional oil fields will peak and start to decline.

According to the International Energy Agency, which advises Australia and other major economies on energy policy, if the current policy proposals from governments around the world stayed as they are today, demand for oil would rise to 99 million barrels per day (mbpd) by 2035. By this time, production of oil will have peaked or almost peaked, the agency says. The UK Energy Research Centre says there’s a “significant risk” conventional oil could peak before 2020. Research from Kuwait University, published in the American Chemical Society’s Energy & Fuels journal, says conventional oil will peak in 2014.

So, who to believe? UK newspaper The Guardian published allegations from two IEA whistleblowers that a looming shortage had been deliberately underplayed. One of the sources, a senior official who wished to remain anonymous, said maintaining oil supplies at 90 to 95 mbpd in years to come would be “impossible”.

Whatever the date, the IEA says unconventional oil will “play an increasingly important role in world oil supply through to 2035, regardless of what governments do to curb demand”.

Unconventional oil comes from sources such as shale, tar sands, deep ocean wells or manufacturing processes such as coal-to-liquids. The IEA says these sources are “several times larger than conventional oil resources”; the US government estimates its oil shale deposits are equivalent to three times the oil reserves of Saudi Arabia. However, unconventional oils are the most expensive and generate more greenhouse gases because of the extra resources needed to extract them. A WWF report on the environmental impact of the Canadian oil sands and US oil shale industries puts the carbon footprint of oil sands as three times that of conventional oil. (Oil shale production is even more carbon intensive.) Other costs to factor in are high water-intensity, deforestation and threats to biodiversity.

There are those who believe we’ve already passed the point of no return. Peter Newman, professor of sustainability at Curtin University in Fremantle, believes conventional oil peaked in 2008. He is not alone in concluding this peak was the trigger for the global financial crisis. As prices for petrol went up, US mortgage-holders in suburbs with poor transport links couldn’t shield themselves from the increased fuel costs.

Newman says the dependence of cities on cheap oil leaves people and economies exposed to the inevitable price spikes. He congratulates community-based responses such as the Transition Town movement, which looks to relocalise economies.

Other solutions will be a rapid shift towards light rail and the roll-out of electric vehicles. “The more we build suburbs that are more car-dependent then the more we induce the kind of poverty and pain that will be associated with the paralysed urban system,’’ he says. “It is not something that we will be proud of. We will wonder why the heck we didn’t do something. We are not beyond redemption but every year we put it off, it gets harder.”

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