Even the higher 13.7 billion barrel figure was only enough oil to power the world economy for five months, assuming you could magically get it out of the ground fast enough.
On the whole we're burning through the easy stuff at a staggering rate, and when these are depleted, the only thing left will be the types that are far more expensive to extract. There might be a time when the stubborn tar sands are actually the cheapest, and the only other types of oil are even more colossally expensive.
1324B/85M/365 = 42.675.
http://en.wikipedia.org/wiki/Oil_reserves
That assumes no consumption growth. The economic argument from peak oil people says: "OK, when we're down to 10 years of oil left, just how much more expensive is a barrel of oil going to be, given that increasing scarcity is evident? Does that price rise also feed back to 20 years? What does it do to the economy, and/or what alternate forms of energy take its place due to economic pressures?"
So yeah, within your lifetime you'll probably feel the effects one way or the other.
It gives a dramatically different picture.
We're not ready for the end of the oil age. For an idea of what it will cost to get off oil, add up all the oil capex that got us here. Now spend that on something else. That's just not happening.
I'm not so pessimistic to think that this will automatically end in a global war or even necessarily a global recession in any case it will be an interesting time to be alive.
The overall economic result will be stagflation and there will be nothing that can be done with the spend, tax, or money supply levers. Less oil means a shrinking economy.
Energy is wealth. It took over 100 years to build this oil-based economy. We have 20-60 years left to get off oil. If we do not start a production line to mass-produce safe nuclear power plants and find a way to safely reprocess the waste, soon, it isn't going to happen in time. We spent trillions on wars and on bailing out an insane derivatives market. Will we have the capital to switch away from oil?
No, lots of things are currently manufactured using oil and moved with oil because it's relatively cheap.
> Once demand can't be met, all parts of the economy bid against each other.
When the price for oil goes high the different alternatives begin to look viable which partially offsets this (one example, electric cars become far more viable when oil is twice the price it is now).
> Many people won't be able to drive to work.
Average person already commutes to work less than the distance a current gen electric car can commute comfortable plus working habits change, remote work, live nearer to work.
> Many factories will not be able to make things at affordable prices and will shut down.
Rising energy costs increase the price the end consumer pays if those items then cost more than people are willing to pay the product stops been made, this is the nature of markets.
> Food will be vastly more expensive. Fertilizer is made of oil.
Not sure why as we don't make fertilizer from oil, we make fertiliser from methane (natural gas usually) which is used to fix the nitrogen from air (NH3) which is the primary precursor for NH4NO3 (Ammonium Nitrate), the only time ammonium nitrate and oil meet is if you want a bang (ANFO).
> Many more people will fall out of the middle class. Tens of millions of people, or more, will starve.
No evidence for this either way to be honest.
> The overall economic result will be stagflation and there will be nothing that can be done with the spend, tax, or money supply levers.
Alternatively the massive push to restructure the economy towards a post oil future will create huge new markets and foster massive investment into non-oil power sources (batteries, nuclear, renewables) much like move to coal did in the 19th century and oil in the 20th.
> Energy is wealth.
Arguably you could use units of energy as a form of wealth but you know what we can extract more energy than we do right now world wide and never have to burn a drop of coal or oil, We have vast untapped reserves of nuclear fuels (the low ball estimates of a few centuries are largely because no one has looked since we had enough).
> It took over 100 years to build this oil-based economy.
Not really, it's been over a hundred years since we have had an oil-based economy the actual usage of oil boomed over a 15-20 year period in the early 20th.
> We have 20-60 years left to get off oil.
We (might) have 20-60 years to get off oil if we continue to consume it at our current rates, the price will go up as supply goes down, alternatives then become viable (nuclear and PV are not that far off on a kW/h basis already over their lifespan).
> If we do not start a production line to mass-produce safe nuclear power plants and find a way to safely reprocess the waste, it isn't going to happen in time.
Define "in time" - http://en.wikipedia.org/wiki/File:Electricity_in_France.svg France went from generating a third of their electricity needs to 75% in under 20 years, they now generate 40% of their entire energy consumption from nuclear.
As for the waste problem that is largely solved with modern designs, old plants where dirty they where dirty because the technology was less developed and because they where designed to produce nuclear material for weapons, We can and have built plants that use their own waste as a useful by product produces vastly less waste.
> We spent trillions on wars and on bailing out an insane derivatives market
The US spent trillion on wars and on bailing out the insane derivatives market but you know what the biggest producer of PV panels and nuclear plants isn't the US...
> Will we have the capital to switch away from oil?
Yes of course, given raw materials and energy we can move from oil.
Will a "post-oil" society look radically different to the one we have today probably and in ways I can't even begin to imagine but it's not a death knell for the human race (in fact getting off burning that crap for energy on the whole will be a good thing...the irony is we might stop fucking up the planet (in terms of CO2 emissions) purely because we no longer can.
As a european socialist by inclination it's ironic that I think the solution is largely going to be market driven but hey whatever works.
And spend the oil capex on what, exactly? Alts? If someone had a really good story on alts, they'd be trying to be the Emperor of alts, not just sitting there. Margins in oil stuff aren't good and it's got a lot of flywheel in skills, infrastructure and distribution. Spend a weekend driving around on the Eagle Ford shale some time.
Oil equipment uses solar panels because it's used close to off the grid. It's not like they don't know about it.
And look at what's happened -- a new wave of natural gas exploration, expansion of alternate technologies like solar, smaller cars, and real life practical electric cars.
The fact that the tar sands are being exploited at all is an indication that the industry believes that prices will stay at least at current levels for many years to come.