|Collapsing Oil Exports|
Another factor is already accelerating the impact of global peak on the importing countries. Almost all of the oil producing countries have rapidly growing economies driven by large oil revenues and in many cases rapidly growing populations. Internal consumption in these countries is ensuring that after peak, the rate of exports declines much faster than production. The two largest producers and exporters Saudi Arabia and Russia are the prime examples. Global economic growth may continue for some years in oil and resource rich countries, but not in the importing countries that have been used to affluence and continuous economic growth for the longest.
Alternatively, a constant state of corruption, dysfunction and/or open war, in oil exporting countries can have the effect of enforcing exports in the face of shortages at home. Although this appears counter-intuitive, the failure of functional governance in the national interest combined with a shattered or stunted economy reduces the capacity of the national market to pay for oil and allows foreign oil companies to gain favourable concessions and military protection from corrupt governments. Aspects of this scenario are at work to maintain the flow of oil from Nigeria and Iraq to the USA and other large importers.
Thus, we can see both the collapsing exports, and enforced export scenarios unfolding simultaneously as the major expression of the struggle for declining production. This suggests at the very least, massive shifts in geo-political and economic power over the next few years, even if global growth continues
The next section considers one other compounding factor, that of decreasing net energy returns.
|Last Updated ( Wednesday, 13 August 2008 )|