Oil & Gas, STAFF NEWS & ANALYSIS
They’re Lying to You About Peak Oil, and Making a Fortune in the Process
By Daily Bell Staff - May 05, 2016

The end of oil as we know it … Oil has crashed.  But a short-term drop in the price of oil is nothing compared with the end of demand for oil as we know it.  The more extreme scenario is what Bernstein Research is now talking about. Energy analyst Neil Beveridge is out with a new note that explores the question of demand — with a prediction that the end of oil as we know it is coming in 2030. –Business Insider

Oil production was supposed to decline and leave the world in chaos and on the verge of starvation. It never happened though, and we knew it wouldn’t.

The concept was known as Peak Oil, and it was a lie.

Now another lie is coming to the fore: the idea that the West and the world are migrating eagerly toward “renewable resources.”

It is an enforced migration, not a voluntary one.

The question for consumers and investors alike is whether it is going to be effective or resisted, as it was in the 1970s. Hundreds of billions and even trillions hang in the balance.

It may sound odd that we argue the energy industry in all its vastness is manipulated. But if you go back in time, you can get some idea of the scale of manipulation that existed and still exists.

We spent well over a decade writing articles about Peak Oil and confronting a plethora of Peak Oil websites that posted article after article claiming that accessible oil was increasingly rare.

None of these websites or the people behind them would consider that their arguments were based on deliberate fallacies.

For instance in the late 1800s, John D. Rockefeller sent his executives over to Europe to attend an initial chemistry conference. They were under strict orders not to return until they had figured out a way to establish that oil was based on the same chemistry that defined other life forms.

Once Rockefeller obtained his manufactured evidence, the marketing of oil as a depleting resource began in earnest. Sinclair Oil even adopted a dinosaur as its logo and mascot.

The Peak Oil concept itself was created in the 1930s by one of the founders of the Technocracy movement, M. King Hubbert.

Hubbert believed Peak Oil would occur in the mid-to-late 20th century. Subsequently, for one reason or another, the date kept moving  up. Then recently, the entire concept collapsed along with the price of oil.

Peak Oil depended on people believing that oil was a scarce commodity. Henry Kissinger put this belief structure to good use when he traveled to Saudi Arabia in 1971 and made it clear that the House of Saud was to sell oil for dollars and nothing else.

This created the famous petrodollar, based on oil scarcity. Saudi Arabia’s ability to insist on the oil-dollar trade was rooted in its role as the number one producer of oil.

In order to maintain Saudi Arabia’s primacy, other sources of oil were repressed. But recently, the same forces that created the petrodollar have begun to disassemble it. The easiest way to undermine the petrodollar is to find other sources of energy.

Once Saudi Arabia becomes just one producer of oil among many, its ability to maintain the petrodollar becomes increasingly tenuous.

As additional sources of oil are discovered, nations increasingly pay for energy in currencies other than the dollar. Nations don’t have to hold dollars anymore and the US’s ability to print unlimited amounts is thus lessened.

This is how the dollar dies, via commodity manipulation created by the same Western elites that created the scarcity – and thus the petrodollar – in the first place.

Now that we have examined previous manipulations, let us examine the gradual decline of oil consumption and the rise of alternative energy – and how that is being manipulated.

Call alternative energy the “new” Peak Oil. It’s being aggressively funded all over the world. Meanwhile, the use of oil and coal is gradually being legislated out of existence.

Oil and gas are fairly easily extracted from the ground. They can be easily transported as well. It is energy you can carry with you.

Solar and wind energy, among other forms, are being manufactured in huge “farms.” Therefore these sorts of energy are controlled at a corporate and government level.

The power that is generated will be available at a domestic level. But power will not be obtainable or transportable by the individual.

The availability of this kind of power gives transnational corporations and government agencies tremendous leverage to influence people’s lifestyles and living conditions.

The rise of alternative energy will be driven by three factors, according to the Business Insider article.

Less use: Developed nations will continually and aggressively reduce the use of oil.

Fuel efficiency: New and better technologies will depress oil consumption.

Climate change: Political activism will generate anti-oil regulatory policies. Demand will be reduced by state power.

Each of these factors, it can be argued, is not the result of public choice but elite manipulation. The whole “renewable energy” industry is vastly dependent on public funding in a way that oil and gas never were. The goal, as stated, is increasing social and economic control.

Given a choice, people might well wish to maintain energy supplies that they themselves can access and transport.

Will the “new” Peak Oil come to pass? Not so fast. People generally are exhibiting increasing impatience with such manipulations.

Conclusion: Years ago we asked, as we ask now, whether elite promotions would be more or less enforceable in the 21st century. If Rockefeller had not been able to enforce the lie that oil was a scarce commodity, the whole industry would have taken on a different and less profitable profile. But today the assertion of elite manipulations is becoming increasingly questionable as people become more politically active and less satisfied with their economic condition. Both investors and consumers must inevitably grapple with this emergent phenomenon.

Posted in Oil & Gas, STAFF NEWS & ANALYSIS
  • Haywood Jablome

    “Solar and wind energy, among other forms, are being manufactured in huge “farms.” Therefore these sorts of energy are controlled at a corporate and government level.”

    Fantastic insight! That dovetails nicely with the banning of wood burning stoves and fireplaces. I have always liked the way DB summarizes and ties together stories with a common thread, but LOVE it when a whole new door is opened. Bravo!

    • Thanks.

      • john cummins

        Yes, you all provide a super alternative. I’d like to see you get into the “formation” of oil as well at some point looking at the work of Thomas Gold from Cornell and the Russians.

  • Hippity

    Government control is over everything we citizens do, and what we have endured for too long, It fast forwarded under Obama. We would do well to fashion a Benjamin Franklin kite to our houses and wait for an electrical charge from above. That’s the only way I can think of to thwart the government’s nonsense on forced energy of big windmills and solar panels that made Obama’s contributor richer!!

  • Praetor

    They like everything in scarcity mode. It seems the only thing that there is plenty of, and of little use is ‘people’.

    I always get a kick out of those Mad Max movies, they never seem to interested in solar or wind generated power, nor do you ever see it in the flicks. They are always chasing petroleum based power and water to keep their machines and themselves going. Quite interesting, since we live in a time of memes, and MSM is the purveyors of propaganda!!!!

  • Donald Lloyd Castle

    You should do some research and learn a little before you write. There is a new thing out called Fracking, I’m sure you haven’t heard about it. But it has kind a changed everything, glad I could help you, go on back to sleep.

    • Praetor

      You’re funny. First time here, right!!!

      • Donald Lloyd Castle

        Who are you !

        • Praetor

          A no body, just like you!!!

    • Fracking has been around for decades.

      • Donald Lloyd Castle

        Yes, I know, just wasn’t sure you did.

        • Bruce C.

          The knowledge of it has been around for decades, but only recently when oil prices were high enough did anyone actually implement the technology. Fracking isn’t cheap.

          • Donald Lloyd Castle

            Your right, Good to hear from you, it’s nice to talk with someone that knows what’s going on !
            Thanks

          • See our response above.

          • Donald Lloyd Castle

            Why don’t you grow up and get over it ! Move on.

      • MM59

        Vertical fracking has been around from the 1940’s, not the current fracking which is down and over (horizontal). Check out the earthquakes in Oklahoma.

        • Not sure we believe the timeline. Horizontal fracking just happened to be “discovered” when monetary elites decided to undermine the dollar. That’s a pretty big coincidence.

          • dave jr

            Are the monetary elite undermining the petrodollar which worked so well for them over the last 45 years; or are they scrambling for a new method of economic control…i.e. green energy and/or energy taxation…i.e. carbon credits?

    • dave jr

      Fracking of shale plays in North America is being proven to be a flash in the pan. I’m not so sure you have done YOUR research.

      • Donald Lloyd Castle

        Where do you get information like that. So flash in the pan, you think it’s over, just how long does your information tell you fracking will be around? Was that more than one source, and do they drive an electric car ?

        • dave jr

          Just google it. Here is one source – http://www.outsiderclub.com/report/the-coming-bust-of-the-us-shale-oil-gas-ponzi/1041

          Data shows that tight oil wells begin to decline after just 2-3 years of production. The drilling companies have to keep adding new wells just to maintain production. With high oil prices there was a mad dash to developing the fields and production ramped up steeply. After the price bust, new well drilling plummeted and daily production of current wells still pumping is falling off dramatically.

          • Donald Lloyd Castle

            Okay, One of us is very wrong. I guess only time will tell.

          • Donald Lloyd Castle

            I missed part of your reply about google it. You can find any answer you want. But that does not mean it’s the truth.

        • Donald Lloyd Castle

          That’s a source I would not put much stock in, do not think it’s to objective. But as I said, time will tell, hope your around to talk about it. But your right that is a source !

  • Bruce C.

    The rapidly looming debt wall is going to put an end to non-essential spending in all industrialized countries soon. Alternative energy sources are more of a luxury than a necessity, especially compared to debt servicing costs and social entitlements. There simply won’t be enough disposable income for governments to spend on boondoggles. We (the US at least) already has enough oil, coal, and natural gas to last at least another hundred years. We also already have the infrastructure, unlike the alternatives. The debates about pollution and climate change and all the rest will become moot as priorities take precedence.

    Furthermore, Hillary Clinton was very clear about rebuilding US jobs and the economy by promoting alternative energy, but then she forgot what states she was in when she also said that the coal miners were going to be put out of business, and now she’s back tracking.

    Trump, on the other hand, promises to put the coal mining business back in business. If the economy and financial markets take a dump after the election alternative energy projects are going to be about as viable as fracking is today – another consequence of easy money mal-investment.

    • jackw97224

      Debt is the issue. 19 trillion admitted fed debt and 210+ trillions of “unfunded liabilities,” which is debt. And virtually no discussion about the criminality of the fiat currency system that facilitated the massive debts and how politicians imposed the repayment upon the backs of people that don’t yet exist. How ironically and diabolically immoral is that?

  • jackw97224

    Well,
    I was taught that “peak oil” was a fact while attending Fresno State
    U. back in 1992-93 and it made sense to me that there is a finite quantity of
    petroleum. While new, improved and/or revived technologies have increased
    production of petroleum, I am still wary as this increased production seems to
    be a case of eating one’s seed corn or consuming one’s savings account. Hope I
    am wrong. Hope fusion reaction can be harnessed so as to provide energy to partially or mostly replace petroleum.

    • alaska3636

      “There are two basic theories for the origin of crude oil: biotic and abiotic.

      The biotic theory predominates. It attributes oil’s formation to the decay of animal and plant matter.

      The less widely accepted – even controversial – abiotic theory denies the involvement of living organisms in the production of crude oil.

      These two theories are finding most of their adherents in two camps – the Western camp (biotic) and the Russian-Ukrainian camp (abiotic) – although there are western scientists in the R-U camp. This division is especially sharp in the 21st century, since researchers have detected hydrocarbons in space objects, where no plant life has ever existed.

      Although some researchers have attributed serious work concerning the abiotic theory to the Western world, published literature shows Eastern scientists predating Western work in this area.”
      http://www.decodedscience.org/origin-crude-oil-petroleum-biotic-abiotic/54008

      “Last week new NASA photographs proved methane lakes exist on Saturn’s moon, Titan, showing that such hydrocarbons (or so-called ‘fossil fuels’) are seemingly plentiful in our solar system. Cassini passes Saturn This startling discovery turns on its head the long-held western belief that petroleum is a limited resource, because it is primarily derived (we had been told) from the fossilized remains of dead dinosaurs and rotted carbon-based vegetation.”
      http://principia-scientific.org/russians-nasa-discredit-fossil-fuel-theory-demise-of-junk-co2-science/

      • jackw97224

        Thanks for the enlightenment. I have read that there is still some “elephant” petro fields below the bottoms of the deep oceans and technology have been and is being perfected so as to allow “lassoing” these domes of energy. Regards.

      • robt

        The controversial Velikovsky proposed that our hydrocarbon deposits came from Venus when it came in close proximity to the Earth a few thousand years ago. He was derided as a crackpot (though he was a friend of Einstein and used to discuss his (V’s) theories with him – how convincingly is another matter).
        What is interesting is that in our amazing age of science, there’s controversy about the origin of hydrocarbon deposits, which seemingly would be a relatively easy quesion to settle.

    • Look into abiotic oil.

    • robt

      In the mid-19th century, alarm was raised about the depletion of whale oil, and the fact that there wouldn’t be enough to keep the lamps lit. The depletion of the resource of whales has proved true enough, but fortunately, oil was discovered in Pensylvania which proved more than sufficient to light the lamps. Then came electricity … from water, from oil, from nuclear power …

  • MM59

    “Solar and wind energy, among other forms, are being manufactured in
    huge “farms.” Therefore these sorts of energy are controlled at a
    corporate and government level.

    The power that is generated will be available at a domestic level.
    But power will not be obtainable or transportable by the individual.”

    I agree with you on most points made but do more research on “the power that is generated will be available at the domestic level”.

    They are building a Global Grid. Transmission lines connecting power across continents are happening as we speak. Technology exists for fast, efficient DC transmission with limited line losses. Read Grid 2030 and the followup report Technologies Roadmap and note that one of the goals for 2030 is “inter-continental bulk transfers of power”.

    The big lie of the renewables is that you can produce your own power and be off the grid. They claim battery storage costs are coming down (they never do though). So they are sucking people in – but you will never get off their grid. And they are doing Solar Management – so they will control when the sun shines and when it doesn’t (all of course to save the planet from the nasty global warming).

    They are doing to the electric company what they did to the banks. Globalization. Energy trading markets. All designed for heads they win, tails we lose.

    • Wow. Thanks.

      • MM59

        Check out today’s story on China’s plans

        “Powers also points to recent successful tests of a “peer-to-peer”
        solar energy trading system in Brooklyn, which allows homes on one side of the street to harvest solar energy and sell it to homes on the other
        side of the street through a trading system which is independent from
        the utility and uses computer software called “blockchain” to keep track
        of the monetary value of the trades.

        “If successful, this could be the ‘Uber’ of solar energy,” Powers
        said, “allowing a solar owner in one time zone to ‘deposit’ solar energy
        into the system and another one miles away to make an ‘energy
        withdrawal’ and the computers will simply keep track of the money.”

        This practice could someday extend to the global level thanks to the
        plans of State Grid Corp., China’s largest utility, to build a global
        energy grid or “renewable energy internet,” over the next 20 years — a
        project which will take $15-30 trillion and the participation of
        multiple regional power grid operators on multiple continents. Plans
        were announced in April 2016 in Beijing and, so far, countries including
        South Korea, Japan and Russia have signed on with China as partners in
        developing a pan-Asian energy grid to extend as far south as the
        Philippines.”

        http://www.smartgridnews.com/story/digital-disruption-energy-prosumers-bringing-more-clout-market/2016-05-17?utm_medium=nl&utm_source=internal

    • Uncle Lerts

      Going “off the grid” is a doomed concept regardless of what type of energy we use, simply due to exponential population growth.

  • Dimitri Ledkovsky

    Another scarcity meme I haven’t run into until recently is regarding “geologically available” silver. This one is frequently amplified by the observation that the volume of recoverable or recycled silver are also on the wane. This meme is of course applied to projections on where the price of silver may be headed in the next (ongoing ?) precious metals bull market. Claims are made that it may some day (within our lifetimes) be traded on par with gold. Is some select in-group of experts being put up to this?

  • jackw97224

    So long as the market, people and their needs and abilities, directs the development and production of solar, wind, hydro, thermal and fosil energies, then I see no justification for anyone telling or forcing anyone to use or do anything. Government intervention is violence and no one should support aggression or sanction politicians to use offensive force.

  • ThomasJK

    Copied from a few paragraphs above:
    “The whole “renewable energy” industry is vastly dependent on public funding in a way that oil and gas never were.”

    However, public funding — subsidies for “renewable energy” included — is highly dependent on wealth and prosperity that is produced by an economy that is powered by oil and gas and coal and nuclear. No oil or gas or coal? No money to fund governments — and that includes no money for our parasitoidic governments to provide subsidies to the various “green” scammers who are currently being made rich by money from economically productive taxpayers that is being misappropriated by the crony socialists who are providing the trough from which the “green” scam-wads are feeding.

  • robt

    Rockefeller’s efforts at consolidating small producers and the effect of competition from other large producers lowered the price of oil from 80 dollars a barrel in the late 19th century to two dollars by the early 20th, where it approximately stayed for about 70 years. And as in today’s world, there were two theories about the origin of petroleum, biotic and abiotic, but whatever camp Rockefeller was in, it doesn’t seem that ‘manipulation’ to gain price advantage was the object, or the at least the result, of his belief in the source of petroleum.
    I would sooner be supplied by ‘big bad corporations’ whose nature it is to compete and lower prices through efficiency and innovation, than government-subsidized charlatans who wish to supply energy at 5 or 10 times the cost of petroleum based fuels, with the motivation for these schemes provided by politicians influenced by groups of neurotics who think that human activities will minutely change the climate and the weather 100 years from now based on manipulated linear projections and extrapolations, with emphasis on Manipulated. Loss of freedom can only come from governments, not corporations. And Ayn Rand pointed out there are two types of capitalism (and definitely financial engineering is not capitalism): capitalism that creates wealth by employing capital to create products that compete in the marketplace and crony capitalism, which relies on the state for sustenance.
    In 1980 it was claimed by the experts and trumpeted in the mass media that we would be running out of oil by 1987, just when the New Ice Age was wreaking horror on the world, and we should Do Something Now, including spreading coal dust all over the Arctic to attract heat to accelerate the melting of ice. If that were the dominant theme of today, it’s shocking to realize that we would probably be doing it right now, and taxing everyone to pay for it. Fortunately, in 1980, the crackpots didn’t win. Today they have. They used to institutionalize these people, now they run everything, and they have unlimited resources through taxation to achieve their goals.

    • Actually, the inflation-adjusted price looks more like $20 a barrel. In part this price must have been based on the perception that oil was not a renewable resource.

      • robt

        In today’s money, I would guess 1913 2-dollar oil would probably be equivalent to 80 dollar oil today, which is the current running average and which means the cost of oil, inflation-adjusted, hasn’t really changed in over 100 years despite onerous taxes, regulations, and the increased costs caused by government interference in the market.
        I usually take the 1913 dollar as 97.5% depreciated thanks to the diligence of the Fed, therefore, a 40:1 ratio for calculating inflation, the official inflation rate always being propaganda.
        So, a 1915 Ford, at 350 dollars is equivalent to 16,000 today (and setting aside any heuristic price adjustment for today’s car, because the 1915 car was also the cutting edge of the technology of the day), 12 cent gasoline = 4.80 dollars today, oil at 2 dollars =80, man’s fine suit 10 = 400, Success Magazine 10 cents = 4 dollars, and finally 2.50 a day to work in a Ford plant = 100 dollars, (but Ford doubled wages in 1914 to 5 dollars, or 200 a day in today’s money), etc etc.
        My original point is that the spot price of oil in prices of the time was 80, and was reduced to 2, a reduction of over 97% in dollars of the day, and this was achieved by increasing production, efficiency, and competition. Surely an oil industry price REDUCTION of 97% is not an indication of someone ‘talking the price up” by implying future supply limitations (which never works anyway), and with gushers blowing off all over the place even in the United States if would be a pretty tough sell. It was a period of oil boom, and in the public’s perception it would last forever.

        • jackw97224

          Unfortunately, those on SS and Medicare, the welfare “Statists” dole, in many cases are not able to offset the losses due to political violence/force via legalized counterfeiting/inflation. So, these 80/bbl prices are exceeding painful and that is the penalty for asking government to finance welfare by stealing from undefended future people; government orchestrated looting of A to satisfy B is immoral; it is evil; it is criminal! I tend to agree with Perry Willis and Jim Babka over at the Zero Aggression Project, Marc Stevens at the No State Project and with Lysander Spooner: No Treason No. 6, The Constitution of No Authority. Regards.

  • Fort McMurray, Alberta has burnt to the ground putting Northern Alberta’s giant oil sands production in jeopardy.

  • Harquebus

    Those that deny peak oil do not understand it while those that advocate renewable energy are the liars.

    “despite a string of optimistic choices resulting in low values of
    energy investments, the ERoEI is significantly below 1. In other words,
    an electrical supply system based on today’s PV technologies cannot be
    termed an energy source, but rather a non-sustainable energy sink or a
    non-sustainable NET ENERGY LOSS.”
    https://collapseofindustrialcivilization.files.wordpress.com/2016/05/ferroni-y-hopkirk-2016-energy-return-on-energy-invested-eroei-for-photo.pdf

    “Windmills are too dependent on oil, from mining and fabrication to delivery and maintenance and fail the test of “can they reproduce themselves with wind power?””
    “Not only would windmills have to generate enough power to reproduce themselves, but they have to make enough power to run civilization.”
    “If the energy costs of intermittency, back-up conventional plant, and grid connection were added to the “cost” of windfarms, the EROEI would be far lower than current EROEI studies show.”
    http://energyskeptic.com/2015/wind/

    “Models often limit their life cycle or EROI analysis to just the solar panels themselves, which represents only a third of the overall energy embodied in solar PV plants. These studies left out dozens of energy inputs, leading to overestimates of energy such as payback time of 1-2 years (Fthenakis), EROI 8.3 (Bankier), and EROI of 5.9 to 11.8 (Raugei et al).”
    “Solar has too many energy costs and dependencies on fossil fuels throughout the life cycle to produce much energy. It’s more of a fossil-fuel extender because PV can’t replicate itself, let alone provide energy beyond that to human society.”
    http://energyskeptic.com/2015/tilting-at-windmills-spains-solar-pv/

    • dave jr

      Good post. I see the same view. Until people understand ERoEI and its ramifications to the modern economy, and stop treating oil coal and gas as just another investment commodity, all discussions are moot. ERoEI is an energy unit accounting method, not a monetary one.

      Unfortunately, the elite technocratic authoritarians understand it all too well and obfuscate the concept with such things as ‘peak oil’ being just a commodity quantity issue, in which a ‘peak’ can not be proven either way. However, the ERoEI of oil (biotic or abiotic makes no difference) falling from 100 to below 10 for many sources (where 1 equates to a non-resource of usable energy), over the last 150 years, is probably the most important topic of our time. It is of the utmost importance to a technocratic elite who skim off the top and manipulate / control mankind and the natural economy built on Human Action, ‘juiced’ by naturally dense energy resources.

      The DB hasn’t answered my questions to my satisfaction. If ERoEI isn’t falling, then why do the oil majors mess around with tar sands with a ratio of about 1.5. Why do they drill in the artic, deep seas, drill horizontally, or at depths in excess of 10,000 feet? Why do they mess around with less energy dense heavy sour crude if light sweet crude is everywhere laying just below the surface? Or if falling ERoEI doesn’t have any effect on economies, then please explain that.

  • Pilgrim

    Energy is not the problem. Too many foolish liberals destroying wealth is the problem.

  • Uncle Lerts

    I like the article. It’s thought provoking but I don’t agree with your underlying thesis if I’m interpreting it correctly. We are already completely dependent on the government and mega corporations for continued supply of oil, and life isn’t that bad. I don’t see why innovation and cleaner energy, forced as it may be, is a bad thing. There are endless ways to spin this transition negatively, and endless ways to spin it in a positive light. In the end society will be split with how we interpret it.

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