Richard Branson warns of Oil Crunch within five years

We spent some of our Christmas vacation travelling around England by train. The weather was pretty horrid and snow storms closed down much of the country’s transportation for days at a time. Some of our transit days were spent crammed into carriages which were available in insufficient numbers to cater for the amount of people travelling over the Christmas period.

The one leg we really did enjoy was from Wales to London on a Virgin express train. It was new, clean, stylish and fast. From the Irish Sea to London in about 4 hours. That is how train travel is supposed to be.

Anyway, as I stared out the window and watched towns flit by, I started wondering whether Richard Branson was aware of Peak Oil. After all, he seems like a really smart guy and his business empire is so reliant on the availability of cheap oil. I wondered whether this was the reason he was moving towards train travel rather than sticking to airlines. Well, my question was answered yesterday when I saw the following article in The Guardian.

This is what the Peak Oil movement needs. A smart, well-respected entrepreneur to bring this subject into mainstream dialogue. Let’s hope this gains some momentum.

Branson warns that oil crunch is coming within five years

Sir Richard Branson and fellow leading businessmen will warn ministers this week that the world is running out of oil and faces an oil crunch within five years.

The founder of the Virgin group, whose rail, airline and travel companies are sensitive to energy prices, will say that the ­coming crisis could be even more serious than the credit crunch.

“The next five years will see us face another crunch – the oil crunch. This time, we do have the chance to prepare. The challenge is to use that time well,” Branson will say.

“Our message to government and businesses is clear: act,” he says in a foreword to a new report on the crisis. “Don’t let the oil crunch catch us out in the way that the credit crunch did.”

Their call for urgent government action comes amid a wider debate on the issue and follows allegations by insiders at the International Energy Agency that the organisation had deliberately underplayed the threat of so-called “peak oil” to avoid panic on the stock markets.

Ministers have until now refused to take predictions of oil droughts seriously, preferring to side with oil companies such as BP and ExxonMobil and crude producers such as the Saudis, who insist there is nothing to worry about.

But there are signs this is about to change, according to Jeremy Leggett, founder of the Solarcentury renewable power company and a member of a peak oil taskforce within the business community. “[We are] in regular contact with government; we have reason to believe their risk thinking on peak oil may be evolving away from BP et al’s and we await the results of further consultations with keen interest.”

The issue came up at the recent World Economic Forum in Davos where Thierry Desmarest, chief executive of the Total oil company in France, also broke ranks. The world could struggle to produce more than 95m barrels of oil a day in future, he said – 10% above present levels. “The problem of peak oil remains.”

Chris Skrebowski, an independent oil consultant who prepared parts of the peak oil report for Branson and others, said that only recession is holding back a crisis: “The next major supply constraint, along with spiking oil prices, will not occur until recession-hit demand grows to the point that it removes the current excess oil stocks and the large spare capacity held by Opec. However, once these are removed, possibly as early as 2012-13 and no later than 2014-15, oil prices are likely to spike, imperilling economic growth and causing economic dislocation.”

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7 comments

  1. Until people start putting things like peak oil and global warming before the economy/profit line I don’t think much is going to happen. Then there are the politicans who think that getting re-elected is more important than making the hard decisions and putting policies is place that force action to be taken.

    They say we have 5-10 years, personally I think we’ve already run out of time because by the time everyone stops stuffing around and getting things done it will be too late.

  2. Interesting indeed to hear Branson weighing in to this debate. As noted, his empire has huge exposure to Peak Oil (but then all of us do really, it’s just a matter of how much you have to loose – up to and including your life).

    My worry with governments waking up to P.O. is: panicking politicians, leading to: panicking public, jingoism, war, everything going to hell in a handcart, fast (in roughly that order).

    I am hoping for a couple more years of preparation time, but not sanguine about the chance of getting it.

  3. I tend to agree with Nevyn and LS. If it has taken us this long to acknowledge Climate Change, there is no freeking way we will act on Peak Oil in time. Oil is simply too pervasive in our entire way of life. There is no other substitute that can do everything that oil can do for us.

    I am thinking that the oil issue will effect our ability to feed the 6.7 million people on the planet way before we worry about where the petrol for our cars is coming from. I just watched the documentary “Collapse” featuring Michael Ruppert. It certainly is an eye opener, but I had already come to realise all of the PO impacts over the last few years myself. I recommend it for those who do not know that TSWHTF very soon.

    In essence we are up the creek without a paddle!

    Gav

  4. dixiebelle – We watched ABC’s Crude last week. It was brilliant. It so thoughtfully explains the entire life cycle of oil that I’d be surprised that anyone could deny the message after watching it.
    nevyn, LS & Gavin – I tend to think that the masses will probably not work out the impact Peak Oil will have until it is far too late. And yes….if they do work it out, panic could ensue. Even as we see the impacts, most people will probably attribute the symptoms to the wrong problem. As evidence, discussion about this whole financial debacle seems to miss the catalyst which was largely the Oil price spike of 2008.
    Gavin – Where did you watch Collapse? I’m very keen to see it.

  5. The movie looks intriguing… R will try to get a hold of it for us!

    I am also reading at the moment, “Why your world is about to get a whole lot smaller” by Jeff Rubin…

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