Cockburn: be a gas guzzler

Alexander Cockburn unhinged?

I have benefited greatly from being a regular reader of Beat the Devil and Counterpunch for 22 years. But check out parts of Cockburn's Oct. 15/16 weekend diary. They seem to read a little crazy:

The Virtues of Gas Guzzling:
Why I Don't Believe in ``Peak Oil''

Since I don't believe in ``peak oil'' (the notion that world production is peaking and will soon slide, plunging the world into economic chaos) and regard oil "shortages" as contrivances by the oil companies and allied brokers and middlemen to run up the price, I fill my aging fleet of 50s and 60s era Chryslers with a light heart, although for longer trips these days I fill an 82 Mercedes 240D with diesel....Part of my light-heartedness comes from the fact that gas guzzling these days can be a revolutionary duty....guzzling keeps up overall oil demand, and hence oil prices, thus helping not only Venezuela but also Russia, which needs every rouble it can get....

Looks a bit scandalous from the point of view of a person who cares about the environment. But realize that I pulled these quotes out of context. When I look at his whole argument (go over to Counterpunch and do that), I'm going to agree with and defend Cockburn a bit.

While I do find his disbelief in peak oil unpersuasively argued -- in large measure because he appears not to understand what he says he does not believe in -- I take his point about buying fuel from Citgo stations in order to lend ``revolutionary'' support to Venezuela. The Pat Robertson quotes woven into this discussion are, well, brilliant in a way only Cockburn can be.

And I do see what he is doing in part -- needling peak oil believers and the liberal environmentalists that he has a long history of reviling.

I'll make public this friendly message I just sent him:

Dear Alex,

Naturally I agree completely with your call for mass action behind the revolutionary vanguard of Venezuelan fuel pumps.

But you make a common error concerning peak oil on one main account. ``Peak oil'' theory is often misunderstood to mean that the world is running out of petrol sometime soon. You see this misconception everywhere, from the film The Oil Factor to the question you asked, ``And what of `peak oil', the theory that oil is about to run out?''

In fact, just the opposite is true. ``Peak oil'' theory says that more oil is available worldwide today than there ever has been. We are, as Yergin and the folks at CERA say, awash in the stuff. However, whether an abiotic component exists or not, oil is depletable. An era will arise -- my belief is that it will within a couple of decades -- when there will be a permanent condition that not everyone gets as much of it as they want.

My feeling is that no accessible quantity of abiotic oil ever will replace the resource extracted from current major fields -- all discovered no less than two and mostly at least four decades ago. Gold notwithstanding, I believe it is magical thinking to believe oil fields somehow refill from below. Every major exploration success of these last few decades has followed from the standard biotic theory instead. I think the score for abiotic oil is something like 80 very questionable barrels in a costly late-1980s Swedish experiment.

Beliefs aside, I do not know when a peak oil downslope condition will become permanent. So you are quite right to charge that recent price run-up has more to do with monopoly practices than genuine shortage. Remember, ``peak'' means we have a lot of the stuff around. But I will add that for whatever reason, the world currently appears to have zero spare oil production capacity. Take your pick of the reason-of-the-day from the business pages. The public data on production capacity is very poor, treated like state secrets in most countries. But would not this appearance be easier to maintain with at least an element of truth to the existence of a nearer-term ``peak'' condition? I would argue that such truth enables and enhances these monopoly practices, expressed after the giant Exxon-Mobil, BP-Amoco, and more recent Valero-Premcor mergers.

Another point of possible disagreement I have with your column is the potential for economic waves not unlike the 1970s shocks that followed US peak oil. Without some kind of un-destructive demand control and international cooperation, this condition could become economically devastating over time. I refer to food production specifically, now running at 10 fossil fuel calories per 1 food calorie produced. Use your imagination on the possible harms here.

Furthermore, it's not hard to imagine competition of powerful states for their desired piece of a slowly shrinking pie. Popular policy pieces, like one by Robert D. Kaplan in the June 2005 issue of The Atlantic Monthly openly discuss the coming war with China and how the US is planning for it. Don't we see in Iraq the beachhead of this policy for a coming era of resource competition? Quite obviously US planners have chosen raw force against the weakest targets for forward base-building -- in a region well-endowed with the fuel the military itself needs -- as the preferred strategic option. You've even written about this yourself in the summer of 2003, right?

On Brazil, are you serious? ``Ethanol is an attractive alternative, as Brazil is proving'' demands your immediate re-examination. Attractive for who? The cane growers or the destitute migrant workers they pay a couple dollars a day to do the cutting? The Brazillian ethanol model -- while evidently returning more energy than it costs in energy to produce, a rare feat for ethanol production -- is totally unsustainable and unscalable on a global basis. Corn ethanol cannot even make back the fossil energy used in its production. Ethanol is a big loser, energetically, socially, and environmentally, when it is viewed as a whole.

One more thing on Brazil -- while it has a vigorous and technically advanced off-shore oil industry, it is a net oil importer. Despite the hype about ethanol Brazil uses a rather large 3 million barrels per day of oil, importing at least 1/3 of its consumption.

Finally, I do agree with you about the notion that the price of oil could drop, and drop sharply. A little thing called demand destruction could do this. That's why it is so important for American screens to be filled with demand-generating pictures of mighty trucks and SUVs all the time. Unfortunately, this situation could be accompanied by a general recession that really could get quite nasty if the real estate bubble bursts in an environment of sharply higher interests rates, as petrodollars disappear from the deficit financing system.

Eric

PS. You wrote this just to bring a phalanx of peak oilers out of the woodwork so you could laugh at them, right?

Update 10/17: I slightly misquoted the oil production/consumption figures for Brazil. According to 2004 figures, Brazil consumes 2.2 million barrels per day (no. 7 in the world) and produces 1.1 million barrels per day. So the actual figure is that Brazil imports 1/2 of its oil.