) I am now more optimistic about our future.I hear some of you thinking, 'why on earth do you think that my Lordship?'.
Well, barring a sudden collapse of the system, which on the basis that the powers-to-be are clearly thinking about PO and the potential financial chaos (see the recent German military report on PO) the TPTB are preparing contingency plans on dealing with the financial aftershocks of PO.
In other words, they won't let the financial system go down... using perception management, covert opps and the Plunge Protection Team (PTT).
Secondly, I have adjusted my outlook on the potential of new technology to mitigate the oil demand picture - if electric cars replace oil powered cars, than, once rolled through the industrialised world, will seriously reduce global oil demand. Deutsche Bank are right, America wastes a huge amount of oil and once they get serious about demand destruction, combined with the Iraqi cheap oil bonunza (which could postpone PO for 10 years) and the shale gas/other oil stuff - this has the potential to keep BAU going for the medium term.
Regarding BAU - its clear that higher prices of oil will eventually force a sustained government led drive away from fossil fuels -so within this decade - BAU will become greening BAU. The system survives but starts to shift away from carbon to low carbon and non-carbon sources.
This is a massive shift which will take decades. Some countries won't make it, due to poor governance, poverty and lack of resources. There will be regions that for different reasons will go through a collapse and even mini-die-ofs - primarily in northern Africa (due to water scarcity) and parts of south-east Asia.
However, I am cautiously optimistic that the bulk of the world can survive the worst case predictions. There is a big hedge though, any large scale terrorism, war or pandemic could destabilise regions which might in other conditions survive the challenges in the coming decades.
India-Pakistan are a clear example - a growing region but very easily destablised.
However, even if certain regions in South Asia or the Middle East (like Iran) go through disorder (or worse) this does not mean the rest of the world is doomed, as these regional disorders are contained.
Longer term, technologies are emerging which could eventually replace fossil fuels (principly biotechnologies) but this is still decades away. Until than, natural gas, coal and nuclear are going to be the transitional energy sources to sustain us during the Long Emergency.
Regarding renewables, yes in the longer term, they could replace fossil fuels but we are going to have to wait for the next generation to emerge, when the synergies of nano and bio fuse together to create space solar power and the mass diffusion of mirco-renewable systems through the bio techno revolution.
I do not pretend that the coming decades will be easier, they will be extreme tough for some parts of the world, for others life will become more of a grind, but there will also be parts of the world which will continue to modernise, harness the emerging technologies and continue to progress. Peak Oil doesn't necessarily mean the end of civilisation. Yes some parts of the world will de-industrialise but the transition very much depends on society. Assuming we don't panic, we don't rule out the potential for science to help us and most importantly we focus on finding a more sustainable way of living life, it shouldn't be too bad.
