JOE and Peak Oil Concerns (who’s JOE? See below.)

The US Department of Defense recently published a 2010 study by the US Joint Forces (Joint Operating Environment or "JOE"). The point of this study was to answer three main questions:

• What future trends and disruptions are likely to affect the Joint Force over the next quarter century?
  
• How are these trends and disruptions likely to define the future contexts for joint operations?
  
• What are the implications of these trends and contexts for the Joint Force?

The 76 page free study makes interesting reading (as in the mythical Chinese curse: "May you live in interesting times) -- cover to cover. However, my interest focuses on the impact of diminishing fossil fuel productions, or what is commonly called "Peak Oil." The authors are no sandwich-board "the end is near" loonies; they are the United States Joint Forces Command. 


It is no secret that the Armed Forces run on petroleum products, and therefore are vulnerable to any production shortfalls (as indeed are we all). Here are a couple of selective quotes from the study.

"To meet even the conservative growth rates posited in the economics section, global energy

production would need to rise by 1.3% per year. By the 2030s, demand is estimated to be nearly 50% greater than today. To meet that demand, even assuming more effective conservation measures, the world would need to add roughly the equivalent of Saudi Arabia's current energy production every seven years.

And here is the International Energy Agency's (optimistic) projection about future production (click on the photo to see a larger version):

Notice the red section starting at 2010. Do you think we'll discover a new Saudi Arabia-class discovery every 7 years? I don't, but even if we do, you can be certain that it won't be cheap – Brazil may have come close to being one such "7 year" discovery, but that is prior to 2010. The Brazilian oil find is miles beneath the ocean, and beneath salt basins at the bottom of the ocean. To get it out (none, I believe, has been pumped yet) will require floating oil platforms costing well over $1 billion each to get the stuff to the surface.

One last quote:

"By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.

Scary? The whole report is scary. But we shouldn't bury our heads in the sand on this, especially the sands of Saudi Arabia.