With the Covid pandemic in the USA going into the 18th month in August 2021, we thought it important to highlight not only the disruptions to the economic system which the pandemic has brought on, but also the existing “ten deadly drivers for the greater depression of the decade of the 2020s” which Nouriel Roubini had laid out early in the arrival of the pandemic in the USA. His predictions were laid out in a Guardian story of April 29, 2020.
One “deadly driver” for very long-term recession or depression is not mentioned in Roubini’s piece, but is I think the most critical of factors. That factor is the world energy shocks that will unfold later in the decade, the years 2026 – 2031. In September 2019, Dennis Coyne covered “World Oil Shocks Scenarios” in his post in PeakOilBarrel-dot-com. His focus was on challenging the always-optimistic predictions that come out of the USA Energy Information Agency. I’ve thought for a long time that the EIA energy outlooks are designed to cater to the public relations needs of the USA’s oil and gas industries, as well as to reassure U.S. consumers (who allegedly drive 70% of GDP growth) so that consumers keep confidently spending money.
In the major study that was dropped late December, 2019, by GTK, the Geological Survey of Finland, just before the pandemic was announced to the global community, Simon Michaux takes 512 pages of PDF to blow up the narrative that Mr. Biden (and all of the fossil fuel corporations script-writers, along with 90% of finance media) are selling about the success of the drill-baby-drill concept. The drill-baby-drill concept goes like this: Action on climate change will just have to wait, because if the nation cuts back on fossil fuel consumption, the economy will decline and millions will suffer. So we must keep on drilling.
Before you can drill it, you have to discover the resource you hope to drill. Very, very little new discovery has happened over the past two decades as Michaux points out. Very little “new oil” will be coming in the next 2 decades, no matter how much ‘drill-baby-drill” happens.
The World Oil Shocks scenarios will start to roll out later this decade. The economy will continue its decline already underway. Think of it as the Eleventh Deadly Driver added to Roubin’s Ten. Millions will suffer, even as frenzied drilling continues.
Here’s the 512-page PDF file stashed on my blog site: Oil from a Critical Raw Material Perspective. The reference list along takes up 23 pages. Lots for you to read and digest there. Click the blue link to read online, or use the “DOWNLOAD” button and save it on your drive for occasional light reading.