A billion stranded losers

Kevin Parlon

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Read an article in the Telegraph this week that struck me. By Ambrose Evans-Pritchard it warns of catastrophes ahead in today's petro-states as the world shifts away from carbon based energy. This isn't a lament for petrol but an assessment of some of the currently un-thought about implications as we move towards a near future where the vast amount of the remaining oil reserves will be economically worthless.

The article is behind a paywall. Perhaps you can read it: Stranded fossil states are the next traumatic chapter of the great energy shift
There's also an article on the fragile 5: "Fragile Five" OPEC Producers Facing Economic Collapse: RBC Capital Markets

It is against site rules (and basic decency) to paste an entire article so I will just bullet point it here:
  • The twin-pincers of draconian carbon curbs and plummeting renewable costs will sweep away much of the old energy order
  • The "Fragile five" are Venezuela, Iraq, Libya, Algeria and Nigeria.
  • Most of the gulf states aren't too far off
  • Nobody wants to talk about the geopolitical implications because they are too disturbing
  • We could see several more "Syrias"
  • Nigeria is a particular problem. With a population streaking towards 300 million it faces desertification and an Islamist insurgency in the North and the loss of 60% of its revenue.
  • Russia also faces instability if not collapse due to its reliance on fossil fuels.
  • Venezuela is the model of collapse in some respects (premature collapse because of corrupt, centrally planned "socialist" policies and hard-to-extract oil).
    • Though it has the largest reserves, extraction costs average near $200 a barrel
    • Infant mortality has nearly doubled
    • 3 million refugees
    • The economy has contracted by two-thirds
  • Technology has already "killed" fossil fuels, or at least mapped out a path where this is irreversible
  • The market has absorbed this and will deal mercilessly with economies reliant on oil. Something that will - in many of our lifetimes - become as archaic as steam-power is to our parents.
  • Norway, aware of the last dash will increase drilling in the North sea by 40% this decade to maximize value to the nation
  • Revenues by the "Global North" to petro states have been contracting by $1.5 trillion a year for 6 years now but many petro-states are too slow in tightening their belts
  • No Green party, for all their humanist piety has spent a moment thinking about this
  • A billion humans face having their world ripped apart in this coming energy transformation
Questions.... What is the EU doing to brace itself for this (massive turmoil on our borders)? When has an Irish politician ever even mentioned this? (Rhetorical question. Irish politicians don't do foreign policy). Is the article alarmist? Inaccurate? Scare-mongering? My own opinion as to the last question: No, no and no.
 


Half Nelson

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The solution is simple. The populations of those countries impoverished by the end of oil will simply move to Europe.
 

Clanrickard

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Read an article in the Telegraph this week that struck me. By Ambrose Evans-Pritchard it warns of catastrophes ahead in today's petro-states as the world shifts away from carbon based energy. This isn't a lament for petrol but an assessment of some of the currently un-thought about implications as we move towards a near future where the vast amount of the remaining oil reserves will be economically worthless.

The article is behind a paywall. Perhaps you can read it: Stranded fossil states are the next traumatic chapter of the great energy shift
There's also an article on the fragile 5: "Fragile Five" OPEC Producers Facing Economic Collapse: RBC Capital Markets

It is against site rules (and basic decency) to paste an entire article so I will just bullet point it here:
  • The twin-pincers of draconian carbon curbs and plummeting renewable costs will sweep away much of the old energy order
  • The "Fragile five" are Venezuela, Iraq, Libya, Algeria and Nigeria.
  • Most of the gulf states aren't too far off
  • Nobody wants to talk about the geopolitical implications because they are too disturbing
  • We could see several more "Syrias"
  • Nigeria is a particular problem. With a population streaking towards 300 million it faces desertification and an Islamist insurgency in the North and the loss of 60% of its revenue.
  • Russia also faces instability if not collapse due to its reliance on fossil fuels.
  • Venezuela is the model of collapse in some respects (premature collapse because of corrupt, centrally planned "socialist" policies and hard-to-extract oil).
    • Though it has the largest reserves, extraction costs average near $200 a barrel
    • Infant mortality has nearly doubled
    • 3 million refugees
    • The economy has contracted by two-thirds
  • Technology has already "killed" fossil fuels, or at least mapped out a path where this is irreversible
  • The market has absorbed this and will deal mercilessly with economies reliant on oil. Something that will - in many of our lifetimes - become as archaic as steam-power is to our parents.
  • Norway, aware of the last dash will increase drilling in the North sea by 40% this decade to maximize value to the nation
  • Revenues by the "Global North" to petro states have been contracting by $1.5 trillion a year for 6 years now but many petro-states are too slow in tightening their belts
  • No Green party, for all their humanist piety has spent a moment thinking about this
  • A billion humans face having their world ripped apart in this coming energy transformation
Questions.... What is the EU doing to brace itself for this (massive turmoil on our borders)? When has an Irish politician ever even mentioned this? (Rhetorical question. Irish politicians don't do foreign policy). Is the article alarmist? Inaccurate? Scare-mongering? My own opinion as to the last question: No, no and no.
Good OP and something I for one believe is an up side of the Green New Deal. Most of these countries are dictatorships and deeply corrupt. These regimes collapsing will be a good thing in the long run. It will also stop the flow of money by Islamists in the Gulf to Islamist oganisations around the world. It will mean the fossil fuel dependent countries will have to come up with clean government and proper justice systems to boost their economies. In the short term we need stronger borders and better asylum systems.
 

Golah veNekhar

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Good OP and something I for one believe is an up side of the Green New Deal. Most of these countries are dictatorships and deeply corrupt. These regimes collapsing will be a good thing in the long run. It will also stop the flow of money by Islamists in the Gulf to Islamist oganisations around the world. It will mean the fossil fuel dependent countries will have to come up with clean government and proper justice systems to boost their economies. In the short term we need stronger borders and better asylum systems.
The Arabian tyrannies you mention are though very allied to the Jewish (Zionism as an ideology is dead- people need to stop the Political Correctness of denying the Jewishness of what is going on in Palestine)- their becoming democracies would be hellish for the Settler Colonial project you so support. Just look at their involvement in the Trump "Peace Plan".
 

McTell

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Given the political risks, the oil states will use their oil at home if they can't sell it, and create advantage that way.

I don't think even the wilder shores of greenery will say to the saudis and iranians - "stop using oil or we will fire missiles". So they will have almost free oil - it may become nearly worthless - and will compete accordingly.
 

Hillmanhunter1

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Given the political risks, the oil states will use their oil at home if they can't sell it, and create advantage that way.

I don't think even the wilder shores of greenery will say to the saudis and iranians - "stop using oil or we will fire missiles". So they will have almost free oil - it may become nearly worthless - and will compete accordingly.
They can use the oil to run their a/c units and their gas guzzlers, but they can't use it to compete, for two reasons:
  1. They don't have the industrial base or experience, most Arab (especially oil-rich) countries struggle to manufacture anything more complicated than a spoon; and
  2. The developed world will (to protect themselves) prohibit the importation goods manufactured with dirty fuels.
 

locke

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Given the political risks, the oil states will use their oil at home if they can't sell it, and create advantage that way.

I don't think even the wilder shores of greenery will say to the saudis and iranians - "stop using oil or we will fire missiles". So they will have almost free oil - it may become nearly worthless - and will compete accordingly.
One of the downsides for them is that they have allowed any industrial and agricultural skills they had lapse or at least not progress because oil would pay the bills. Ironically, Iran is probably in a better place on this because sanctions have forced them to be somewhat self-reliant in these areas.
 

Malcolm Redfellow

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Ambrose Evans-Pritchard: the fantasy-merchant who played Toto to tip the screen and reveal Bill Clinton as the Wizard of Oz behind the 1995 Oklahoma City bombing. Yeah. So successful on his American expedition, he had to run home from the mockery for a berth on the ever-declining Torygraph.

Here's a couple of thoughts:
  • If solar to a large extent supplants fossil oil, which parts of the world are best located to benefit? And all those wide-open spaces of the deserts, too.
  • Which is more likely to foment future wars — battles over depleted oil or over water rights? [On which note, seen the state of the Jordan Valley?]
 

locke

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Electricity gets lost during transmission, so you can't just put power plants in sunny countries unless they are near their market.

For a country like Algeria, which isn't all that far from a lot of Europe's industrial base, it does represent an opportunity as hydrocarbons decline. For the Gulf, the opportunity is nothing like as high, unless India takes China's role as the manufacturer of the world.
 

Clanrickard

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The Arabian tyrannies you mention are though very allied to the Jewish (Zionism as an ideology is dead- people need to stop the Political Correctness of denying the Jewishness of what is going on in Palestine)- their becoming democracies would be hellish for the Settler Colonial project you so support. Just look at their involvement in the Trump "Peace Plan".
**** off.
 

Kevin Parlon

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Good OP and something I for one believe is an up side of the Green New Deal. Most of these countries are dictatorships and deeply corrupt. These regimes collapsing will be a good thing in the long run. It will also stop the flow of money by Islamists in the Gulf to Islamist oganisations around the world. It will mean the fossil fuel dependent countries will have to come up with clean government and proper justice systems to boost their economies. In the short term we need stronger borders and better asylum systems.
Obama inferred this too. But there are potentially catastrophic consequences. I suppose one could view this as a kind of "Lancing the boil". Painful, but ultimately good. My interest is how studiously we are ignoring it. Rather like the demographic collapses in Europe which are now looming ever closer.
 

Kevin Parlon

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The Arabian tyrannies you mention are though very allied to the Jewish (Zionism as an ideology is dead- people need to stop the Political Correctness of denying the Jewishness of what is going on in Palestine)- their becoming democracies would be hellish for the Settler Colonial project you so support. Just look at their involvement in the Trump "Peace Plan".
Aaaaaaannnd we're back to the JOOOOOS.
 

Kevin Parlon

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Given the political risks, the oil states will use their oil at home if they can't sell it, and create advantage that way.
The rot in those countries is far beyond the fix of free petrol for everyone. What will they do? Fill their aging combustion engine cars that are no longer being manufactured? Apparently the country most prepared for this hangover is Abu Dhabi.

I don't think even the wilder shores of greenery will say to the saudis and iranians - "stop using oil or we will fire missiles". So they will have almost free oil - it may become nearly worthless - and will compete accordingly.
It is likely to become worthless or near worthless. Like having vast reserves of whale oil. The countries are so corrupt that to cut off the money (paid for by people in the global North mostly) will cause their societies to fall apart. I suppose the option before them then will be the choice they make: Religion or progress?
 

Kevin Parlon

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Here's a couple of thoughts:
  • If solar to a large extent supplants fossil oil, which parts of the world are best located to benefit? And all those wide-open spaces of the deserts, too.
  • Which is more likely to foment future wars — battles over depleted oil or over water rights? [On which note, seen the state of the Jordan Valley?]
Is it a given solar power will be the main replacement for fossil fuels? For solar power, infrastructure, proximity and technology play a far greater roles than does having land to put the panels on. Even if they were to become as dominant in solar as they are in oil, how do they export it? Put it on a ship? If renewable energy ever becomes the export business (requiring inter-connectors I suppose) fossil fuels are the United States has the infrastructure, the technology and vast desert wilderness to do it. So does China I suppose. The future of energy supply is likely to be a more local phenomenon. I expect OPEC will have as much share of the future global energy supply market as they do currently of technology. Which is to say none. Which brings us back to the point of the OP. How will these billion fare as their economies and societies collapse?
 

Kevin Parlon

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Electricity gets lost during transmission, so you can't just put power plants in sunny countries unless they are near their market.
Exactly. Which is what makes the "But they have plenty of sun and lots of desert" such a non-starter.

For a country like Algeria, which isn't all that far from a lot of Europe's industrial base, it does represent an opportunity as hydrocarbons decline. For the Gulf, the opportunity is nothing like as high, unless India takes China's role as the manufacturer of the world.
Perhaps, but I doubt they could compete with Spain. Who have the sun, the area, the stability and technology and an already interconnected grid into the largest economic bloc on the planet.
 

owedtojoy

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Ambrose Evans-Pritchard: the fantasy-merchant who played Toto to tip the screen and reveal Bill Clinton as the Wizard of Oz behind the 1995 Oklahoma City bombing. Yeah. So successful on his American expedition, he had to run home from the mockery for a berth on the ever-declining Torygraph.

Here's a couple of thoughts:
  • If solar to a large extent supplants fossil oil, which parts of the world are best located to benefit? And all those wide-open spaces of the deserts, too.
  • Which is more likely to foment future wars — battles over depleted oil or over water rights? [On which note, seen the state of the Jordan Valley?]
The good old Torygraph is sounding the alarm at last. It is with some schadenfreude that I can point that it was once a stronghold of climate change denial, like other media outlets such the Murdoch press. The Telegraph willingly gave a platform to commentators who attacked the energy transition as completely pointless. It subscribed to the notion that climate change was a conspiracy of wayward left-wing scientists, and succeeded (along with other forces) in delaying climate action for two decades at least.

Now at last, it editorial board sees fit to publish articles crying "Woe! Woe!".
 

owedtojoy

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Is it a given solar power will be the main replacement for fossil fuels? For solar power, infrastructure, proximity and technology play a far greater roles than does having land to put the panels on. Even if they were to become as dominant in solar as they are in oil, how do they export it? Put it on a ship? If renewable energy ever becomes the export business (requiring inter-connectors I suppose) fossil fuels are the United States has the infrastructure, the technology and vast desert wilderness to do it. So does China I suppose. The future of energy supply is likely to be a more local phenomenon. I expect OPEC will have as much share of the future global energy supply market as they do currently of technology. Which is to say none. Which brings us back to the point of the OP. How will these billion fare as their economies and societies collapse?
I notice in the OP a bitter and groundless attempt to foist all this on the Greens.

Why so?

The Greens have been warning about climate crisis for decades, from a position as a minority party, against conservative parties who refused to wake up and take the problem seriously.

Now:

Conservative Parties to Greens: This is awful! What are you going to do about it?
Greens, right back: What are you going to do about it? It is you who have been in power for 30 years, and still are. We have been telling you about the coming crisis all that time, and you ignored us. Now, you suggest solutions, too.
 

Kevin Parlon

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The good old Torygraph is sounding the alarm at last. It is with some schadenfreude that I can point that it was once a stronghold of climate change denial, like other media outlets such the Murdoch press. The Telegraph willingly gave a platform to commentators who attacked the energy transition as completely pointless. It subscribed to the notion that climate change was a conspiracy of wayward left-wing scientists, and succeeded (along with other forces) in delaying climate action for two decades at least.

Now at last, it editorial board sees fit to publish articles crying "Woe! Woe!".
Did you read the article? It appears not. The article says nothing about climate change. It is an article about the implications of the global shift from fossil fuels. You have an incorrigible tendency to conflate people who do not agree with much of the presented "remedies" for global warming with denial of global warming itself. Which is a silly error to make.
 

Kevin Parlon

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I notice in the OP a bitter and groundless attempt to foist all this on the Greens.

Why so?

The Greens have been warning about climate crisis for decades, from a position as a minority party, against conservative parties who refused to wake up and take the problem seriously.

Now:

Conservative Parties to Greens: This is awful! What are you going to do about it?
Greens, right back: What are you going to do about it? It is you who have been in power for 30 years, and still are. We have been telling you about the coming crisis all that time, and you ignored us. Now, you suggest solutions, too.
How about you have a think about what the implications might be for Nigeria and the gulf rather than attempting to read my mind? You could start that by replaying Venezuelan developments and mentally transplanting them to Nigeria, Libya and Saudi Arabia
 

Malcolm Redfellow

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Is it a given solar power will be the main replacement for fossil fuels? For solar power, infrastructure, proximity and technology play a far greater roles than does having land to put the panels on. Even if they were to become as dominant in solar as they are in oil, how do they export it? Put it on a ship? If renewable energy ever becomes the export business (requiring inter-connectors I suppose) fossil fuels are the United States has the infrastructure, the technology and vast desert wilderness to do it. So does China I suppose. The future of energy supply is likely to be a more local phenomenon. I expect OPEC will have as much share of the future global energy supply market as they do currently of technology. Which is to say none. Which brings us back to the point of the OP. How will these billion fare as their economies and societies collapse?
Guaranteed energy exploitation = industrial growth. Late c18th, that was coal, so the British industrial revolution. Early c.20th, John D Rockefeller's Standard Oil. If, in future, solar undercuts wind (reliability) and nukes (disposal costs), do the math.
 


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