The Peak Oil Crisis: Rationing

By Michael C. Ruppert

© Copyright 2005, From The Wilderness Publications, www.fromthewilderness.com. All Rights Reserved. May be reprinted, distributed or posted on an Internet web site for non-profit purposes only.

July 18, 2005 1000 PST (FTW) -- In previous stories, reprinted from the Financial Times, (April 16, 2005, IEA Calls For Emergency Plan), and Al Jazeera, (March 24, 2005, IEA Wants Brakes on Fuel Consumption) we commented on how the International Energy Agency had apparently dusted off plans for rationing to be imposed (with the full authority of government and the UN) in nations which had signed the original UN treaty in 1974 or joined later.

The IEA plan is here. As of today, IEA Member countries include: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg, The Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, United Kingdom and the United States. (Source: http://www.iea.org)

Now we see the Falls Church News-Press (a very influential local newspaper from an affluent Washington, DC suburb) do some very hard-edged reporting on Peak Oil issues. This is the second time FTW has reprinted a News-Press story in a month. This is a local paper for the spot where the senior policy makers, intelligence officials and many high-ranking military personnel live and raise their families. They want a local paper that prepares them and that's what they've got. They get "authentic journalism" of sorts.

Contrary to this story's spin however, this plan has more loopholes for black market profiteering, arbitrage and manipulation than a colander has for draining spaghetti. The profit potential here is far greater than it would be with, for example, tax credits and subsidies for renewables. Once again, we're back to the infamous quotation: "It may not be profitable to slow decline." Or, as Catherine Austin Fitts says, "They make money on the way up and they make money on the way down."

On the other hand, mandatory and enforced rationing might be the only way to penetrate a very thick American skull. We do reveal a bovine nature on occasion.

So I think it's time we all put rationing (serious rationing) on our schedule of upcoming events.

When? (Sigh). It could be as soon as this winter. I would say, of a certainty, no later than January or February 2007.

Here's the key quotation: -- "A couple of weeks ago, the British press reported that Her Majesty's cabinet is considering a plan to ration energy consumption. The immediate reason for implementing such a system is to reduce the UK 's emission of greenhouse gases as required by the Kyoto Treaty. The plan's authors, however, claim that if the proposal works, it will deal equally well with equitably allocating dwindling energy supplies caused by peak oil."

What the News-Press tells us is that we should just as well expect rationing here. The British might get there first. That would be a great psychological prep. (We must emulate the Brits as they endured "The Blitz" in 1940-41.) But it is also a certainty that the first and most important wild beast which must be tamed in terms of consumption is the United States of America.

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The Peak Oil Crisis: Rationing

By Tom Whipple
Falls Church News-Press
July 14 - July 20, 2005 VOL. XV NO. 19
http://www.fcnp.com/519/peakoil.htm

In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.

It has to come sooner or later. As oil becomes scarcer and scarcer and price rises higher and higher, pressures will grow for a formal allocation system. Rationing will come, if only to calm the havoc at the gas lines and the social upheavals that are bound to occur as long as rationing is only by price.

America's most recent experience with rationing goes back to World War II. You have to be nearly 70 to remember the little square "A", "B", and "C" stickers affixed to the windshields of ever car. These stickers, when accompanied by a sheet of rationing stamps, allowed one to buy gas. Everybody got an "A" sticker (a whole 4 gallons a month just for the asking). To get a "B" or "C" sticker, one had to appear before a rationing board and make the case their mobility was vital to the war effort or at least the well-being of their fellow citizens.

If one ponders for a few minutes on how a modern rationing system might be structured, it is soon apparent nearly any scheme is full of inequities and would be subject to massive and, no doubt, ingenious fraud- especially when an American's ability to drive his beloved car is at stake. Do you allocate fuel by vehicle? Buy a yard full of clunkers and drive to your heart's content or until you run out of money. Or allocate gasoline by person, by licensed driver, by commute distance, by adjusted gross income? Problems abound everywhere.

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Apollo II

"Nonrenewable resources should be exploited,
but at a rate equal to the creation of renewable substitutes."

by Herman Daly, [now at University of Maryland] in Ecological Economics


Our future is impossible as long as the citizens of the USA and those who emulate the USA consume their body weight in oil each week.

With reserves that, absent imports, would be used up in 4 years, the USA in particular is in no position to alienate its neighbors. Rather than invade oil-rich countries, drill for oil in pristine and marginal fields, or further endanger our planet with nuclear proliferation (in any country), humanity must mount a massive effort to create a viable renewable energy solution. If Iceland and the Galapagos Islands can do it, certainly the G8 and OECD nations can.

As John F. Kennedy called for a massive commitment, "We choose to go to the moon," it is now time to reach for [power from] the sun.

For humanity's sake, to replace the demands we are currently making on fossil fuels with renewable energy sources, we must increase the use of wind power, hydro-electric, photovoltaics, biomass, and other renewable systems world wide by perhaps 20-35% or more per year. We are calling this great mobilization "Apollo II."

Renewable Energy is about to become a profound growth industry, almost as dramatic as the electronic commerce fostered by the emergence of the World Wide Web. Here we present the goals and guidelines for this transition as proposed by various experts and renewable energy associations around the world.

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The Peak Oil Crisis:The Storms of August

The Storms of August
By Tom Whipple

It has become fashionable in peak oil circles to make the comparison between the current summer and that of 1914--- just before the cataclysm of World War I. That year too, was a warm and idyllic summer in which the people went happily about their business unaware the assassination of an archduke was about to destroy the old order and plunge the world into decades of turmoil.

This time, the trouble spawned in the South Atlantic , strengthened in a global-warmed Caribbean and slammed into the heart of the US oil industry. The flooding of New Orleans and the destruction of miles of the Gulf coast will rank among the greatest natural disasters America has ever known, for a number of reasons.

For the Gulf oil industry, the approach of a Category 5 Hurricane was a signal to shutdown and run for cover. The super tankers bringing up to 900,000 barrels a day to the Louisiana Offshore Oil Port (The LOOP) headed elsewhere. The 55,000 oil workers on platforms out in the Gulf shut off the pumps, plugged their wells, and boarded ships and helicopters to safety, thus halting the production of some 1.4 million barrels of oil a day � some seven percent of US daily consumption.

Eight refineries in the path of the storm were shut down and the workers evacuated. This reduced immediately US refining by 1.8 million barrels a day.

As the storm moved towards shore, first the offshore oil platforms in its path were badly mauled. Some 30 rigs were sunk including hubs that concentrate and prepare the oil for transport to shore. We do not yet have a complete assessment of the damage to the undersea network of pipelines that brings the oil to shore, but if the damage done by much weaker Hurricane Ivan last year is any guide it should be considerable. In the opinion of one knowledgeable commentator, it will take years to bring production back to pre-hurricane levels.

Finally, the storm cut the electricity to the pipelines moving some 3 million barrels per day of gasoline, jet fuel, and heating oil from the Gulf refineries to consumers in the mid-west and the East Coast.

The week before the hurricane, the US gasoline inventory was down to 194 million barrels or about a 19-day supply. The loss of production from 10 refineries and the shutting down of the pipelines soon led to spot shortages running from the Rockies through the mid-west to the Southeast. The West Coast and north of New York are not part of the Gulf oil infrastructure.

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