Possible effects and consequences of Peak Oil

The widespread use of fossil fuels has been one of the most important stimuli of economic growth and prosperity since the industrial revolution, allowing humans to participate in takedown, or the consumption of energy at a greater rate than it is being replaced. Some believe that when oil production decreases, human culture and modern technological society will be forced to change drastically. The impact of Peak oil will depend heavily on the rate of decline and the development and adoption of effective alternatives. If alternatives are not forthcoming, the products produced with oil (including fertilizers, detergents, solvents, adhesives, and most plastics) would become scarce and expensive. At the very least this could lower living standards in developed and developing countries alike, and in the worst case lead to worldwide economic collapse. With increased tension between countries over dwindling oil supplies, political situations may change dramatically and inequalities between countries and regions may become exacerbated.

The Hirsch Report
In 2005, the US Department of Energy published a report titled Peaking of World Oil Production: Impacts, Mitigation, & Risk Management. Known as the Hirsch report, it stated, "The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking."

Conclusions from the Hirsch Report and three scenarios

 * World oil peaking is going to happen, and it will be abrupt and revolutionary.
 * Oil peaking will adversely affect global economies, particularly those most dependent on oil.
 * Oil peaking presents a unique challenge (“it will be abrupt and revolutionary”).
 * The problem is liquid fuels (growth in demand mainly from the transportation sector).
 * Mitigation efforts will require substantial time.
 * 20 years is required to transition without substantial impacts
 * A 10 year rush transition with moderate impacts is possible with extraordinary efforts from governments, industry, and consumers
 * Late initiation of mitigation may result in severe consequences.


 * Both supply and demand will require attention.
 * It is a matter of risk management (mitigating action must come before the peak).
 * Government intervention will be required.
 * Economic upheaval is not inevitable (“given enough lead-time, the problems can be solved with existing technologies.”)
 * More information is needed to more precisely determine the peak time frame.

Possible Scenarios:


 * Waiting until world oil production peaks before taking crash program action leaves the world with a significant liquid fuel deficit for more than two decades.


 * Initiating a mitigation crash program 10 years before world oil peaking helps considerably but still leaves a liquid fuels shortfall roughly a decade after the time that oil would have peaked.


 * Initiating a mitigation crash program 20 years before peaking appears to offer the possibility of avoiding a world liquid fuels shortfall for the forecast period.

Transportation and housing
A majority of Americans live in suburbs, a type of low-density settlement designed around universal personal automobile use. Commentators such as James Howard Kunstler argue that because over ninety percent of transportation in the United States relies on oil, the suburbs' reliance on the automobile is an unsustainable living arrangement. Peak oil would leave many Americans unable to afford petroleum based fuel for their cars, and force them to move to higher density areas, where walking and public transportation are more viable options. Suburbia may become the "slums of the future." The issues of petroleum supply and demand is also a concern for growing cities in developing countries (where urban areas are expected to absorb most of the world's projected 2.3 billion population increase by 2050). Stressing the energy component of future development plans is seen as an important goal.

Methods which have been suggested for mitigating the urban and suburban issues surrounding Peak oil include non-petroleum vehicles, transit-oriented development, new trains, new pedestrianism, smart growth, shared space, and New Urbanism.

Mitigation
To avoid the serious social and economic implications a global decline in oil production could entail, the Hirsch report emphasized the need to find alternatives at least 10-20 years before the peak, and to phase out the use of petroleum over that time, similar to the plan Sweden announced in 2005. Such mitigation could include energy conservation, fuel substitution, and the use of non-conventional oil. Because mitigation can reduce the consumption of traditional petroleum sources, it can also affect the timing of peak oil and the shape of the Hubbert curve.

Positive aspects of peak oil
There are those who believe that peak oil should be viewed as a positive event. Many of these critics reason that if the price of oil rises high enough, the use of alternative clean fuels could help control the pollution of fossil fuel use as well as mitigate global warming. Others, in particular anarcho-primitivists, are hopeful that it will cause or contribute to the collapse of civilization.