Blood And Oil  

The Independent has a report on the future of Iraq called "The spoils of war", which notes that foreign oil companies are about to gain access to Iraqi oil for the first time in 30 years. Mission accomplished ? They think Iraq has the world's third largest oil reserves, which is an estimate I'd disagree with (at the risk of boring regular readers to death). As usual, Dick Cheney's words say it all - "The Middle East, with two-thirds of the world's oil and the lowest cost, is still where the prize ultimately lies" - or as I call it, the greatest prize of all.

Iraq's massive oil reserves, the third-largest in the world, are about to be thrown open for large-scale exploitation by Western oil companies under a controversial law which is expected to come before the Iraqi parliament within days.

The US government has been involved in drawing up the law, a draft of which has been seen by The Independent on Sunday. It would give big oil companies such as BP, Shell and Exxon 30-year contracts to extract Iraqi crude and allow the first large-scale operation of foreign oil interests in the country since the industry was nationalised in 1972.

The huge potential prizes for Western firms will give ammunition to critics who say the Iraq war was fought for oil. They point to statements such as one from Vice-President Dick Cheney, who said in 1999, while he was still chief executive of the oil services company Halliburton, that the world would need an additional 50 million barrels of oil a day by 2010. "So where is the oil going to come from?... The Middle East, with two-thirds of the world's oil and the lowest cost, is still where the prize ultimately lies," he said.

Oil industry executives and analysts say the law, which would permit Western companies to pocket up to three-quarters of profits in the early years, is the only way to get Iraq's oil industry back on its feet after years of sanctions, war and loss of expertise. But it will operate through "production-sharing agreements" (or PSAs) which are highly unusual in the Middle East, where the oil industry in Saudi Arabia and Iran, the world's two largest producers, is state controlled.

Opponents say Iraq, where oil accounts for 95 per cent of the economy, is being forced to surrender an unacceptable degree of sovereignty.

Proposing the parliamentary motion for war in 2003, Tony Blair denied the "false claim" that "we want to seize" Iraq's oil revenues. He said the money should be put into a trust fund, run by the UN, for the Iraqis, but the idea came to nothing. The same year Colin Powell, then Secretary of State, said: "It cost a great deal of money to prosecute this war. But the oil of the Iraqi people belongs to the Iraqi people; it is their wealth, it will be used for their benefit. So we did not do it for oil."

Supporters say the provision allowing oil companies to take up to 75 per cent of the profits will last until they have recouped initial drilling costs. After that, they would collect about 20 per cent of all profits, according to industry sources in Iraq. But that is twice the industry average for such deals.

The Independent has more detailed commentary on the long awaited oil grab - "Blood and oil: How the West will profit from Iraq's most precious commodity".

So was this what the Iraq war was fought for, after all? As the number of US soldiers killed since the invasion rises past the 3,000 mark, and President George Bush gambles on sending in up to 30,000 more troops, The Independent on Sunday has learnt that the Iraqi government is about to push through a law giving Western oil companies the right to exploit the country's massive oil reserves.

And Iraq's oil reserves, the third largest in the world, with an estimated 115 billion barrels waiting to be extracted, are a prize worth having. As Vice-President Dick Cheney noted in 1999, when he was still running Halliburton, an oil services company, the Middle East is the key to preventing the world running out of oil.

Now, unnoticed by most amid the furore over civil war in Iraq and the hanging of Saddam Hussein, the new oil law has quietly been going through several drafts, and is now on the point of being presented to the cabinet and then the parliament in Baghdad. Its provisions are a radical departure from the norm for developing countries: under a system known as "production-sharing agreements", or PSAs, oil majors such as BP and Shell in Britain, and Exxon and Chevron in the US, would be able to sign deals of up to 30 years to extract Iraq's oil.

PSAs allow a country to retain legal ownership of its oil, but gives a share of profits to the international companies that invest in infrastructure and operation of the wells, pipelines and refineries. Their introduction would be a first for a major Middle Eastern oil producer. Saudi Arabia and Iran, the world's number one and two oil exporters, both tightly control their industries through state-owned companies with no appreciable foreign collaboration, as do most members of the Organisation of Petroleum Exporting Countries, Opec. ...

Paul Wolfowitz, Deputy Defense Secretary at the time of the war and now head of the World Bank, told Congress: "We're dealing with a country that can really finance its own reconstruction, and relatively soon."

But this optimism has proved unjustified. Since the invasion, Iraqi oil production has dropped off dramatically. The country is now producing about two million barrels per day. That is down from a pre-war peak of 3.5 million barrels. Not only is Iraq's whole oil infrastructure creaking under the effects of years of sanctions, insurgents have constantly attacked pipelines, so that the only steady flow of exports is through the Shia-dominated south of the country.

Worsening sectarian violence and gangsterism have driven most of the educated élite out of the country for safety, depriving the oil industry of the Iraqi experts and administrators it desperately needs.

And even the present stunted operation is rife with corruption and smuggling. The Oil Ministry's inspector-general recently reported that a tanker driver who paid $500 in bribes to police patrols to take oil over the western or northern border would still make a profit on the shipment of $8,400. ...

Production sharing agreements of more than 30 years are unusual, and more commonly used for challenging regions like the Amazon where it can take up to a decade to start production. Iraq, in contrast, is one of the cheapest and easiest places in the world to drill for and produce oil. Many fields have already been discovered, and are waiting to be developed.

Analysts estimate that despite the size of Iraq's reserves - the third largest in the world - only 2,300 wells have been drilled in total, fewer than in the North Sea.

Confirmation of the generous terms - widely feared by international non government organisations and Iraqis alike - have prompted some to draw parallels with the production-sharing agreements Russia signed in the 1990s, when it was bankrupt and in chaos.

At the time Shell was able to sign very favourable terms to develop oil and gas reserves off the coast of Sakhalin island in the far east of Russia. But at the end of last year, after months of thinly veiled threats from the environment regulator, the Anglo-Dutch company was forced to give Russian state-owned gas giant Gazprom a share in the project.

Although most other oil experts endorsed the view that PSAs would be needed to kick-start exports from Iraq, Mr Muttitt disagreed. "The most commonly mentioned target has been for Iraq to increase production to 6 million barrels a day by 2015 or so," he said. "Iraq has estimated that it would need $20bn to $25bn of investment over the next five or six years, roughly $4bn to $5bn a year. But even last year, according to reports, the Oil Ministry had between $3bn and $4bn it couldn't invest. The shortfall is around $1bn a year, and that could easily be made up if the security situation improved.

"PSAs have a cost in sovereignty and future revenues. It is not true at all that this is the only way to do it." Technical services agreements, of the type common in countries which have a state-run oil corporation, would be all that was necessary.

James Paul of Global Policy Forum, another advocacy group, said: "The US and the UK have been pressing hard on this. It's pretty clear that this is one of their main goals in Iraq." The Iraqi authorities, he said, were "a government under occupation, and it is highly influenced by that. The US has a lot of leverage... Iraq is in no condition right now to go ahead and do this."

Mr Paul added: "It is relatively easy to get the oil in Iraq. It is nowhere near as complicated as the North Sea. There are super giant fields that are completely mapped, [and] there is absolutely no exploration cost and no risk. So the argument that these agreements are needed to hedge risk is specious." ...

Iraq has 115 billion barrels of known oil reserves - 10 per cent of the world total. There are 71 discovered oilfields, of which only 24 have been developed. Oil accounts for 70 per cent of Iraq's GDP and 95 per cent of government revenue. Iraq's oil would be recovered under a production sharing agreement (PSA) with the private sector. These are used in only 12 per cent of world oil reserves and apply in none of the other major Middle Eastern oil-producing countries. In some countries such as Russia, where they were signed at a time of political upheaval, politicians are now regretting them. ...

The largest beneficiary of reconstruction work in Iraq has been KBR (Kellogg, Brown & Root), a division of US giant Halliburton, which to date has secured contracts in Iraq worth $13bn (£7bn), including an uncontested $7bn contract to rebuild Iraq's oil infrastructure. Other companies benefiting from Iraq contracts include Bechtel, the giant US conglomerate, BearingPoint, the consultant group that advised on the drawing up of Iraq's new oil legislation, and General Electric. According to the US-based Centre for Public Integrity, 150-plus US companies have won contracts in Iraq worth over $50bn.

30,000 Number of Kellogg, Brown and Root employees in Iraq.

36 The number of interrogators employed by Caci, a US company, that have worked in the Abu Ghraib prison since August 2003.

$12.1bn UN's estimate of the cost of rebuilding Iraq's electricity network.

$2 trillion Estimated cost of the Iraq war to the US, according to the Nobel prize-winning economist Joseph Stiglitz.

WHAT THEY SAID

"Oil revenues, which people falsely claim that we want to seize, should be put in a trust fund for the Iraqi people"
Tony Blair; Moving motion for war with Iraq, 18 March 2003

"Oil belongs to the Iraqi people; the government has... to be good stewards of that valuable asset "
George Bush; Press conference, 14 June 2006

"The oil of the Iraqi people... is their wealth. We did not [invade Iraq] for oil "
Colin Powell; Press briefing, 10 July 2003

"Oil revenues of Iraq could bring between $50bn and $100bn in two or three years... [Iraq] can finance its reconstruction"
Paul Wolfowitz; Deputy Defense Secretary, March 2003

"By 2010 we will need [a further] 50 million barrels a day. The Middle East, with two-thirds of the oil and the lowest cost, is still where the prize lies"
Dick Cheney; US Vice-President, 1999

Of course, if you use an estimate around 300 billion barrels of oil for Iraq (and there is plenty of support for that number being the correct one) instead of 115 million, you'll understand why the American's are going to fight on in Iraq until the end of the oil age (even if the saner voices realise the war is doomed) - so the sooner we convert our economies away from oil the more secure we'll all be...

The Independent also makes the link to peak oil - the reason why Iraqi oil (being a large, barely tapped resource courtesy of a number of historical factors) is becoming all the more valuable - in "Oil. The fast-vanishing drug the world can't yet live without".

Production may peak within a decade, causing massive withdrawal symptoms to the world and its economy

Say what you like about Dick Cheney, but you can't accuse him of not giving us fair warning. A year, almost to the day, before he was dubiously elected Vice-President of the United States - while still chairman of the energy giant Halliburton - he gave a riveting insight into the thinking that has since guided the administration's oil policy.

In a speech to the Institute of Petroleum in November 1999 he shed light on our front-page revelation - that in the wake of the occupation of Iraq, Western companies are to be let loose on its vast, and previously state-owned, oil reserves. Perhaps even more importantly he flagged up an impending crisis that the world urgently needs to grasp - that supplies of oil may be about to shrink alarmingly. The "basic, fundamental building block of the world economy" was, he warned, in danger of becoming extremely scarce.

Estimates suggested that production from existing reserves would soon decline sharply, by 3 per cent a year, even as world demand for oil grew by 2 per cent. That meant that the world would soon need to be producing "an additional 50 million barrels a day", more than half as much again as the 82 million now being wrested from the ground. "So where is this oil going to come from?" he asked. His answer: the Middle East was "where the prize ultimately lies". The problem was that "governments and national oil companies" controlled almost all of the "assets", and "even though companies are anxious for greater access there, progress continues to be slow".

Lest there be any doubt about what was at stake, the man who was to become one of the most powerful proponents of the invasion of Iraq went on: "Oil is unique because it is so strategic in nature. We are not talking about soapflakes or leisurewear ... The Gulf War was a reflection of that reality."

Well, seven years on, Mr Cheney's solution to the impending oil crisis is well on its way to being implemented. In the aftermath of another war, Iraq's Council of Ministers is today expected to throw open the doors to the country's oil reserves - the third-largest in the world - to private companies, the first time a major Middle Eastern producer has ever done so.

Whether this will work for the oil giants depends on an end to the insurgency being achieved, while a compliant government is maintained, which looks more unlikely as each week goes by. But whatever the practicality - and morality - of his solution, the Vice-President's diagnosis is sound enough. Indeed it probably understates the crisis facing the world.

For a start, as Mr Cheney put it, "oil is unlike any other commodity". The world is deeply hooked on it, and any reduction in its massive daily fix will cause devastating, and possibly catastrophic, withdrawal symptoms. It is not just that it makes up 40 per cent of all the energy that is traded worldwide, and no less than 90 per cent of all the fuel used in transport. Every aspect of our lives and our economies has been designed around the assumption that it would continue to be plentiful and cheap.

Our cities have been allowed to sprawl - particularly in the US, where, until recently, petrol cost less than bottled water. And almost everything we consume in developed countries depends on it. About 10 calories of fossil fuels - principally oil - are burned to produce every calorie of food consumed in the US. A staggering 630g of them are burned to produce a single gram of microchips. And making a car consumes the equivalent of 840 gallons of petrol, enough to drive it for the first two years of its life.

Even some alternative energy sources advanced as oil's replacements in fact crucially depend on it. Nuclear power is fuelled by uranium, mined and transported by oil-powered machinery and vehicles. Biofuels depend on crops grown by oil-powered intensive agriculture.

Worse, the world's entire financial system is based on the assumption that the decades of growth fuelled by cheap oil will continue. A permanent shortage, by some predictions, would lead to another Great Depression lasting for generations, sparking conflicts as nations fought over shrinking supplies.

Yet, as Mr Cheney indicated, such a shortage is becoming a real and present danger. More and more experts are convinced that the world is rapidly approaching a uniquely dangerous threshold when, for the first time, humanity will suffer a cut in supplies of its main source of energy before an alternative is available.

After all - as the current issue of the scientific journal 'Nature' points out - there were still plenty of forests standing when the world switched from wood to coal as its principal fuel, and there were hundreds of years of supplies of coal still in the ground when oil took over. Yet there is no other source of energy versatile enough or ready to be exploited fast enough and on a large enough scale to take up the slack if oil supplies suddenly begin to decline.

The tipping point at which this decline begins goes under the increasingly popular tag of "peak oil". It marks the moment at which what have - for the past 150 years - been ever-expanding, and therefore generally cheap, supplies of the stuff turn into steadily declining, ever more costly ones.

The prediction is based on the observation - first made by an American geophysicist called M King Hubbert 50 years ago - that oil production rises sharply to a peak, and then slumps equally rapidly. Hubbert thought, on this basis, that production in the US's 48 states (excluding Alaska and Hawaii) would peak in this way in the early 1970s. Official statement after reassuring official statement rubbished his apparent pessimism - even suggesting that the peak would not come until the 22nd century. But, sure enough, it arrived in 1970.

Much the same thing has been happening in the North Sea. New, but unpublicised, official figures buried in the latest issue of Energy Trends - a dry Department of Trade and Industry (DTI) report published on Thursday - show that UK production has been falling sharply for the seventh successive year. ...

Whenever it is, the world is not likely to get much warning from the market. Prices did not rise sharply in the US just before oil production peaked there, mainly because the costs of production remained about the same.

But nasty surprises can be expected before the world is far along the downward slope. Oil prices almost quadrupled during the 1970s oil shocks, even though production fell only by around 5 per cent. And after peak oil the decline would be permanent and intensifying, not short-term and reversible as it was then.

And it may be that Mr Cheney's prediction of a 3 per cent annual decline, immensely disruptive as it would be, is indeed, as he said, "conservative". The head of one giant oil services firm has suggested that production might fall by 8 per cent a year, which would mean that supplies fell by half in just nine years. That, after all, is about what is happening in the British North Sea.

Such a slump could hardly be less than catastrophic to the world economy. All we can do is to pray that the peak will be later, and the downward slope less severe - and embark on a crash programme to save energy and develop renewable sources as fast as possible, something we already urgently need to do to try to control global warming.

Dick Cheney has decried both energy efficiency and renewable sources in the past. It seems he has another plan. And indeed some experts believe that, if peace were miraculously to break out in Iraq and oil production can be miraculously increased, the peak-oil tipping point could be pushed back four or five years. But it would then come just as unrelentingly.

But the Vice-President can be sure of one consolation. In his speech seven years ago he complained that oil was "the only large industry whose leverage has not been all that effective in the political arena". If ever that were so, six years of two oilmen running the world's most powerful nation has certainly sorted that out. But whether the world - or Iraq - has benefited, is entirely another matter.

Of course, the building blocks are rapidly being created for a transport system that needs no oil - and those individuals, organisations and countries that put these in place should transition through the peak oil period easily (fueled with copious aternative energy), while those that don't, won't.

One last piece from The Independent - their lead article on "the oil rush, which notes that Bush is going to go down as the worst US president in history.

"The oil can is mightier than the sword," said the 19th-century US Senator Everett Dirksen. Nowhere does this seem more true than in contemporary Iraq where, despite widespread despair about the war's costs in terms of blood and treasure, US corporations look set to be some of the conflict's few winners. The announcement that the Iraqi government is planning to change its constitution to allow foreign extraction of oil will give Western companies access to the world's third largest oil reserves. Production sharing agreements (PSAs), lasting for up to 30 years, will divert up to 75 per cent of Iraqi oil revenues to Western drilling companies until their initial investment costs have been recouped. The importance of this cannot be overstated for a shattered country still reliant on oil for 95 per cent of its income.

Of course, the Iraqi oil industry, starved through years of sanctions and now under constant insurgent attack, badly needs Western investment. Only a small proportion of Iraq's known oil fields have been developed, and production still languishes below pre-invasion levels. The neo-conservative dream - indulged in by Paul Wolfowitz and Dick Cheney prior to the conflict - that the invasion and reconstruction would be self-financed through a twist of the oil taps, dissipated long ago.

In a country where unemployment has hit 70 per cent, a policy that will quicken the pace of economic reconstruction should be universally welcomed. At face value, the measure is not being imposed by the fiat of a US general: it will be voted on in the Iraqi parliament and, if passed, enacted by a democratically elected government. And objections that foreign companies will steal Iraq's birthright seem faintly anachronistic in the global economy: specialist engineering is an international industry these days, and Iraq's command economy, isolated from the rest of the world, urgently requires liberalisation.

But it doesn't demand the fevered imaginings of a conspiracy theorist to think that this law, struck while the beleaguered Iraqi government is facing opposition from all quarters, protects the interests of oil wealth (which is so well represented in the White House) more than it does the Iraqi people. Production sharing agreements don't apply in most other major Middle Eastern oil producers because they are widely thought to grant greater control to companies than governments. With economies so heavily dependent on oil, it's hard to see how countries can truly be self-governing if they sign away influence over their almost exclusive source of wealth.

Legitimate questions must be asked. How did this decision come to be made? How much pressure was President Nouri al-Maliki placed under to bend to the American corporate interests? Conservative US thinktanks such as the Heritage Foundation have been plotting the wholesale privatisation of the Iraqi oil industry for years. Since 2003, the supposed reconstruction of Iraq by US companies has left a bitter taste with most Iraqis who see a symbiotic relationship between the US military and big business that would make a British district commissioner in imperial Africa blush.

From the immediate aftermath of the invasion, the ill-fated US proconsul, Paul Bremer, denied the Iraqi government the ability to give preference to Iraqis in the reconstruction effort. Instead, US companies were awarded contracts totalling more than $50bn. And they have conspicuously failed to deliver. Despite billions spent, clean water, sanitation and electricity are below pre-war levels. The spectre of Americans scouting the country for oil at the same time as the death toll from the insurgency reaches new heights could shatter whatever residual faith is left among the Iraqis in the intentions of Western policy. Iraqis will reach the natural conclusion that, from the beginning, the Iraq adventure was an attempt to steal imperial spoils.

Before the war, to meet precisely these criticisms, Tony Blair promised that a development fund for Iraq was to be established to hold in trust the proceeds from oil sales under United Nations control. But, like so many of the concessions that the Prime Minister attempted to squeeze out of the President, this got lost somewhere in the Oval Office.

This is not the moment to rehearse the causes of the Iraq war, disputed as they are, but this newspaper has always been sceptical that it was "all about oil". Yet, at a time when the Americans and British are desperate to establish some sort of credit on the ground in Iraq, to make some claim on Iraqi hearts and minds, this arrangement looks terrible. What greater fuel could a conspiracy theorist want than the news of this oilman's bonanza? Was it mere coincidence that the war's most vociferous champions, such as Dick Cheney, were former oilmen? Policymakers would do well to remember that long and lucrative contracts handed to Western oil companies by the Shah of Iran during the 1960s led to a widespread feeling that the country was raped.

The Iranian revolution was the bitter harvest of a previous generation's oil greed in the Middle East. It would be to heap a further tragedy on Iraq if, in a country where the appearance of things can be as important as how they really are, the perception was to grow yet further that it was American greed that took the country to war. The importance of reflecting honourable intentions towards the Iraqi people is all the more important in a week when, in the teeth of a new Democrat-controlled Congress, President Bush is expected to announce a "surge" of 20,000 troops to "secure" Baghdad. After spending the Christmas break reflecting on Iraq policy, the President seems to have chosen what his obstinate character always suggested: to ignore the conventional wisdom and dig the hole in which Iraq policy is mired ever deeper.

After years of repeating his stay-the-course mantra, it was unlikely that, whatever the appalling evidence from Baghdad, George Bush would suffer the ignominy of admitting defeat. With ratings of his handling of the war at an all-time low, this is George Bush's final chance to avoid his presidency being branded as one of the worst in history. Like a gambler who has stacked up losses and hopes that one more lucky throw will rescue him, the President thinks that a modest additional deployment in Baghdad will see him vindicated by what he likes to call the "long march of history".

US Congressman Ron Paul made another one of his enjoyable speeches in the US House of Representatives this week. I always love the irony that a Texas Republican is one of the few US politicians willing to describe what is really going on.

Mr. Speaker, Saddam Hussein is Dead. So are Three Thousand Americans.

The regime in Iraq has been changed. Yet victory will not be declared: not only does the war go on, it’s about to escalate. Obviously the turmoil in Iraq is worse than ever, and most Americans no longer are willing to tolerate the costs, both human and economic, associated with this war.

We have been in Iraq for 45 months. Many more Americans have been killed in Iraq than were killed in the first 45 months of our war in Vietnam. I was in the U.S. Air Force in 1965, and I remember well when President Johnson announced a troop surge in Vietnam to hasten victory. That war went on for another decade, and by the time we finally got out 60,000 Americans had died. God knows we should have gotten out ten years earlier. “Troop surge” meant serious escalation.

The election is over and Americans have spoken. Enough is enough! They want the war ended and our troops brought home. But the opposite likely will occur, with bipartisan support. Up to 50,000 more troops will be sent. The goal no longer is to win, but simply to secure Baghdad! So much has been spent with so little to show for it.

Who possibly benefits from escalating chaos in Iraq? Neoconservatives unabashedly have written about how chaos presents opportunities for promoting their goals. Certainly Osama bin Laden has benefited from the turmoil in Iraq, as have the Iranian Shiites who now are better positioned to take control of southern Iraq.

Yes, Saddam Hussein is dead, and only the Sunnis mourn. The Shiites and Kurds celebrate his death, as do the Iranians and especially bin Laden – all enemies of Saddam Hussein. We have performed a tremendous service for both bin Laden and Ahmadinejad, and it will cost us plenty. The violent reaction to our complicity in the execution of Saddam Hussein is yet to come.

Three thousand American military personnel are dead, more than 22,000 are wounded, and tens of thousands will be psychologically traumatized by their tours of duty in Iraq. Little concern is given to the hundreds of thousands of Iraqi civilians killed in this war. We’ve spent $400 billion so far, with no end in sight.

This is money we don’t have. It is all borrowed from countries like China, that increasingly succeed in the global economy while we drain wealth from our citizens through heavy taxation and insidious inflation. Our manufacturing base is now nearly extinct.

Where the additional U.S. troops in Iraq will come from is anybody’s guess. But surely they won’t be redeployed from Japan, Korea, or Europe. We at least must pretend that our bankrupt empire is intact. But then again, the Soviet empire appeared intact in 1988.

Tom Whipple has a peak oil news roundup for 2006 in the Falls Church News Press.

As the year draws to a close, it is a good time to look back at what has happened and what clues we can discern about 2007.

The most notable event affecting the advent of peak oil during 2006 was, most likely, the great summer price spike. Oil started the year around $62 a barrel, steadily increased to just below $80 and then fell to close out the year about where it started. Now there are a number of observations that can be made about this spike.

First it drove average US gasoline prices from $2.21 in late December 2005 to a high of over $3.00 per gallon during the summer. This was significant in that it caught a lot of people’s attention for the first time that there just might be a problem out there. At the height of the spike, Congressmen were running around like rabbits proposing new laws and making pious speeches about how they were doing something about gasoline prices. Although the US economy as a whole seems to have held up pretty well under $3 gasoline, Detroit took a hard hit. Sales of low-mileage vehicles that had been the bread and butter of the US auto industry plunged, tens of thousands of auto workers lost their jobs, and dozens of factories closed. By year’s end Toyota was poised to become the world’s largest automotive manufacturer.

Largely unnoticed was the underlying supply and demand situation, and a new factor: oil affordability. The final returns won’t be in for several months, but it is beginning to look as if world oil production stayed about the same or increased insignificantly during 2006. Consumption in China, Russia, and the Gulf oil states increased while staying about the same in the industrialized states of North America, Europe and Asia.

With flat production and steady or increasing consumption in those countries that publish detailed reports, something had to give or else we would be seeing considerably higher oil prices. The give came in the underdeveloped world where $20 or $30 oil was affordable for generating electricity, running pumps, and for cooking, but $60 or $70 per barrel oil was not. Again, the returns are not in yet, but anecdotal evidence is accumulating that many parts of Africa, Central America, and Asia are starting to shut down. For these peoples, the oil age, such as it was, is already over. There is little to look forward to for a long, long time.

Nearly every aspect of the various Middle Eastern political conflicts deteriorated further during 2006. From the peak oil perspective 1.5 million barrels a day of Iraqi oil exports appear to be the most precarious, but what ever falls out of Iran’s nuclear ambitions are a close second. A general conflagration occasioned by the collapse of the Iraqi government or renewed Arab-Israeli fighting are well with in the realm of possibility for the near future. The insurgency in Nigeria is picking up steam and there will be either a presidential election or civil war there next year. The prospects for a large percentage of the world’s petroleum exports sure did not get any better in 2006.

When the history of the year is written, resurgent Russian nationalism is sure to have prominent place. During the year, Moscow made good on its goal to bring exploitation of Russian oil by the international oil companies back under its control. President Putin clearly sees the opportunity to regain superpower status by controlling a significant share of pipeline-supplied natural gas on the Eurasia landmass. It seems likely a reduced role for the international oil companies can only lead to reduced investment and delays in the exploitation of Russian oil and gas deposits.

As yet no major developments in the world’s oil depletion story have emerged in 2006. Production from numerous major oil deposits – the North Sea, Mexico’s Cantarell, Alaska’s Prudhoe Bay, Kuwait’s Burgan – continues to decline. Many analysts harbor suspicions that Saudi production has or will shortly go into decline. The situation is obscured, perhaps on purpose, by OPEC production cuts that have “required” the Saudi’s to make reductions in their oil production. It may take many years to sort out their actual production capacity.

So where do all the developments of 2006 leave us as regards to peak oil? Maybe further than is currently apparent. One thing is for certain, the earth has 30 billion barrels less cheap, easy-to-produce crude at its disposal than it did 12 months ago because we burned it up. World oil production currently is giving every indication of at least plateauing for a while, perhaps forever. Many new production projects are being delayed as the cost of exploration and drilling new wells increases to unheard of heights. Oil availability for the rich nations still appears adequate because the poor are shutting down. But this is a one-time phenomenon. Soon, increasing demand from the rich and rapidly developing nations will cause them to bid against each other for stagnant or decreasing production.

Then the troubles will begin in earnest.

Resource Investor's "Peak Oil Passnotes" column is wondering if 2007 is time to get out of oil.

Because the recent run up in prices have meant that companies have been falling over themselves to put on extra barrels of production. Of course this cannot be done overnight so we are now seeing the first wave of new output about to hit the market. Fields like Dalia in Angola, operated by the French company Total and of course, later in the year, its huge gas project Dolphin from the UAE.

Throw in oil sands from Athabasca, BP’s delayed Atlantis project and a multitude of others and we are starting to wonder if a glut is in the offing. Of course there are going to be problems along the way, but in a market that is already satisfactorily supplied we could find ourselves beyond satisfactory and into, well, oil gluttony.

It is fascinating for market watchers to see the possibility that 2007 could be defined within the first few weeks. If the Nymex and Intercontinental Exchange (ICE) can push down below $54 then the rest of the year may well follow suit. Money has started pouring in on the short side of the market and the bets are on that oil is only going one way, down.

But then there are some disruptions along the way. Firstly maintenance. As everyone and their dog have been pumping flat out over the past few years, desperate to make as much money as they can from $70-plus crude the knackered bits of the oil complex are just that: knackered. Bits are going to drop off, like they did in Prudhoe Bay.

We are also looking at some areas of the world that are, in the words of the trade “inflecting” or “maturing”. Basically they have peaked, but you cannot say “peaked” as that means you believe in UFO’s, black helicopters and that Guinness really is good for you, rather than just good.

The North Sea is a prime example of a region that has peaked. The merger of Statoil and Norsk Hydro is a great sign of that. Because so much of their traditional production has been in the Norwegian Continental Shelf they have run into a brick wall. Basically there is nothing left to find beyond the scraps. This means that the two companies, who have been pioneering in the U.S. Gulf, have merged to create an offshore demon.

The new company is going to be the biggest offshore producer in the world. This is a great move because all the onshore oil has been used up. Now we humans are looking for our hydrocarbons at greater and greater depth and Statdro, or Hyrdoil, or whatever they will be called, will be in a great position to exploit that.

But to come full circle if we have a year of oil in the $50-$55 range then all of a sudden the oil companies are going to find themselves paring back. They have been hit by huge increases in costs, raw materials, personnel, rig rates and so on. They have entered into new contracts which have tied in those costs. But all of a sudden they might not like those super expensive technological breakthroughs they have been talking of.

So, after complaining so much about how high prices are unwanted, like OPEC, what the IOCs really meant was ‘high prices are great.’ And if 2007 does not produce some wars, giant storms or major Al Quaida attacks then they will really be annoyed.

AOL's "Money and Finance" column notes that peak oil isn't bad for everyone - oil services companies like Schlumberger (and its local equivalents down here like Worley Parsons) will find the quest to exploit smaller and more difficult fields lucrative. For a time.

While some energy companies are worried about dwindling reserves, Schlumberger Ltd (NYSE: SLB) stands to gain enormously as oil and gas become harder to find.

This company provides high-tech equipment and services to oil and gas companies, and its products are especially useful for the kind of unconventional drilling needed to find new sources. SLB is one of the top two companies in the world for just about every type of product and service it offers, and it invests heavily in R&D to maintain its competitive edge.

Not surprisingly, results have been very impressive over the past couple years. Growth in revenues and profits has been steady and impressive, and there's no reason to think this growth won't continue for the next few years. SLB's global focus gives it good protection against a downturn in any one region. Russia holds particular promise: The company has been working there for 50 years and now stands to benefit greatly from that country's rapidly growing oil business.

There are some risks -- oil is a cyclical business, and a company like SLB has high capital and R&D costs. The stock price has risen quickly and some analysts feel it is way overvalued. The longterm may be difficult as the world's economies try to conserve or adapt new forms of energy. But for the foreseeable future, oil and gas are only going to be in higher demand as China, India and other developing countries continue to grow and as the United States continues to rely on hydrocarbons.

Nature has a feature on peak oil called "Energy: That's oil, folks...".

Don't say they didn't warn us. The poster for the meeting of the Association for the Study of Peak Oil and Gas in Boston this October featured American revolutionary Paul Revere on his midnight ride, bringing news of imminent calamity. Only this time it is not the British who are coming, but the end of the oil era, and with it much of western civilization.

Many attendees at the meeting were people who could tell you how to stock a bunker to survive the inevitable collapse of civilization, and then opine at length about the extent and characteristics of the great tar-sand deposits of Canada. Some of them conduct a thriving mini-business in preparing for the coming apocalypse — "deal with reality or reality will deal with you", as one website claims — while scrutinizing table after table of data on world oil production.

But this is not an easily dismissed fringe. Respected geologists with lifetimes of experience are genuinely concerned that the world is about to see an unprecedented crisis — a reduction in the supply of a primary fuel before an alternative is available. ...

Matthew Simmons, an energy investment banker in Houston, Texas, and self-described "petro-pessimist", argues that the world's great oilfields are moving quickly towards the end of their production, or have already passed into rapid decline. ...

Some people think that the declines we are seeing are indicators that the world is on the verge of, or has already passed, the maximum amount of oil that can physically be produced. In their view, oil production follows a bell-shaped trajectory, with the peak occurring when half of the total reserves have been consumed. ...

If you accept this principle, then the issue of when the peak comes depends mainly on the amount of reserves that remain untapped, and that in itself gives room for disagreement. But some don't accept these premises. To them, these arguments are simplistic geological determinism that does not take into account the role of oil prices. To the dissenters, reserves are not a geological given but a function of the current price and the extraction technology that price can buy. New reserves will be developed as the market demands.

Both sides issue regular, well-referenced reports that come to opposite conclusions on whether the world is running out of oil. "There's just no middle ground," says Kenneth Deffeyes, a geologist who has retired from Princeton University in New Jersey, and is a leading supporter of the peak-oil theory. His personal belief is that we are already a year past the peak. If he's wrong, though, he's sure that it will prove not to be by much: the peak is imminent, and unavoidable.

Meanwhile, a study from energy analysts Cambridge Energy Research Associates (CERA) in Massachusetts sees no sign of any peak in production occurring before 2030. And, crucially, CERA doesn't see a peak with a steep downside — rather a crest followed by an undulating plateau (see chart), which would be much less apocalyptic even if it happened today.

It's not that CERA thinks that oil production has no constraints, or that the geological resource can't be depleted. Even oil company executives say publicly that they see a problem. T. Boone Pickens, the maverick Texas oil magnate, has said that he thinks oil production may already have reached its maximum. And in October, during an address to the National Press Club in Washington DC, Shell Oil president John Hofmeister acknowledged that "the easy stuff is running out". "We may argue about when the peak is, but it doesn't change the argument that it's coming," says Robert Kaufmann, an energy economist at Boston University in Massachusetts. "I don't know if we are all Hubbertists now, but we are all recognizing that there is a finite quantity of oil."

Hubbert, in this context, is M. King Hubbert, the geophysicist who first predicted that oil production would peak quite suddenly [in the lower 48 states of the U.S.] — and that when it did, it would slump sharply thereafter...

Those in favour of the peak-oil theory argue that Hubbert's methods for analyzing US oil output can also be used to analyze the global production peak. Deffeyes, known to many as the charismatic protagonist of Basin and Range, the first of John McPhee's great popular accounts of modern geology, has emerged as a particularly prominent Hubbertist. ...

Bart at Energy Bulletin comments:

The full article is behind a paywall. Only excerpts are presented here to give the flavor of the original.

Contributor SP writes:

Well it's long and covers a lot of ground, but most readers of EB will already know most of this. In a way the only interest is that it was published in Nature, and can therefore be considered "mainstream".

As one would expect from Nature, this piece is better quality journalism than in the typical "peak oil" article in the press. Still there is room for improvement. Perhaps in subsequent articles, Nature might go beyond the he-said-she-said frame of reference, in which an issue is automatically seen as a debate between two sides, equally striving for the truth. This has proved a poor model for reporting on global warming, and it is equally poor for peak oil.

For one thing, certain groups have vested interests in squashing the idea of peak oil. Also, the demographics of peak oil writers are different than those of the skeptics. Peak oil counts among its ranks many retired employees of oil and energy companies, who are now free to speak out.

Also, all the peak oil arguments are available free online. CERA has only put their press release online. Their 16-page report in which it makes its case against peak oil costs $1000.

In contrast, many rebuttals to the CERA report are available online. The archives of Energy Bulletin, The Oil Drum, ODAC and the various ASPOs are full of background material and analyses.

In future reporting, it would be good to go into more analysis. Which arguments are solid and which are PR talking points? What are the areas of agreement? Where exactly are the differences of opinion? I think there is much more agreement than first meets the eye.

A minor point. Towards the end of the article, Witze writes "From an environmental point of view, a peak [in oil production] might almost be welcome." Actually, the fear is that after peak, oil would increasingly be replaced by coal, releasing even more greenhouse gases.

Thanks to Nature for its coverage, and I hope we will see more in the future.

"The First Post" has an article wondering if public opinion in the UK is being softened up for an Israeli attack on Iran, and speculates that the real winner if this happened would be the Russians. Given that this stuff has been going on for more than 2 years now its hard to get too worked up about it - and I sincerely hope that the Israelis realise that MAD worked fine for the Americans and Russians (and does today for the Pakistanis and Indians) and it will do so for them and the Iranians should Iran ever get the bomb.

Suddenly the smell of Britons being prepared for an attack on Iran is all pervasive. On Radio 4 this week, the BBC's political editor Nick Robinson hosted a bizarre 45-minute round-table on how Britain would react if America and Israel went ahead and bombed Iran. Broadcast on Wednesday and repeated tomorrow, it was pitched as a discussion of hypothetical 'what ifs'.

The next morning, Anatole Kaletsky, of the Times, wrote a column about Blair and US-Israeli-Saudi plans to trash Iran. Yesterday's Spectator went further. In its cover story, it states that Israel is planning to use nuclear strikes to stop the Iranian nuclear industry. It is not a question of if but when Israel will launch its missiles and bombers, we are told.

What is going on? The facts as far as we know them - based on inquiry, investigation and real sources - are these:

The Israelis, according to the strategic think tank at Tel Aviv University, stated last month that the only way to stop Iran getting operational nuclear weapons was by military strike. There are only four or five months left in which this might be done successfully, and if the US won't help Israel to do it, Israel will go it alone. US Vice-President Dick Cheney is signed up to this, and is trying to persuade George Bush.

The US military has drawn up the war plans for a strike on Iran, according to British intelligence sources. However, the chiefs of all three US armed services have told Bush not to do it. "The Americans have no serious human intelligence on the ground in Iran," a senior British commander told me recently.

As I reported on November 1, the British Army Board looked at intelligence assessments of Israeli proposals to attack nuclear sites in Iran. The briefing paper estimated this would "cause hundreds of thousands of casualties".

The Israelis and their supporters who continue to argue for an attack do so because they believe they successfully thwarted Saddam's nuclear weapons plans with their pre-emptive strike on the Osirak plant outside Baghdad in 1981. In fact, according to one of Saddam's leading nuclear scientists, Jafar Dia Jafar, the raid only encouraged Saddam to press ahead with his nuclear programme rather than stop it.

Tony Blair also believes in action. He asked an audience in Dubai last month: "When are you going to do something about it?" Yet neither Blair nor the Radio 4 panel discussed the likely consequences of an attack on Iran.

The fact is, any such strike is likely to halt the oil flow through the Gulf - and trigger a world recession. Iran is likely to attack the offshore gas fields and terminals, knocking out about one-third of the world's gas supply. This in turn could provoke global conflict and make Russia the energy superpower.

Kos from Daily Kos notes that the AEI's Michael Ledeen has a blog post reporting Iran's Ayatollah Khamanei is dead. It appears (like most of Ledeen's rantings) that this is just another wild fantasy that people should just ignore.

Can conservative bloggers get anything right? Anything at all? Glenn Greenwald:

The entity that calls itself "Pajamas Media" thought it had scored some sort of great coup when it landed Michael Ledeen of National Review and the American Enterprise Institute -- who has devoted his life to insisting that the U.S. change the regime in Iran -- as a Pajamas Media commentator.

And yesterday, Pajamas thought the prestigious "signing" had begun to yield big, big dividends, when they announced, based on Ledeen's "source close to Pajamas Media," that Iran's Supreme Leader Ayatollah Ali Khamenei had died -- a "fact" which nobody else had reported. And a day later, still nobody else has. Ledeen yesterday wrote: "Breaking News. Ayatollah Ali Khamenei, Iran’s Supreme Leader, is dead." Pajamas itself touted it as its breaking story.

As Malkin's Hot Air said: "This is either going to be a two-ton feather in Pajamas’s cap or a major embarrassment." A day later, nobody else has reported this. Today, Iran denied the "Internet rumor," and as James Wolcott notes (read his whole post for the real story), Pajamas Media is backing away as fast as their little rumor-mongering legs can carry them. As Wolcott says, comparing this to the Jamil Hussein debacle: "there's another potential fiasco belching in the furnace of the right blogosphere perhaps birthing an even bigger embarrassment of riches."

Wolcott has the full story on Pajama Media's own Rathergate.

But back to Glenn:

So, just to re-cap the week in Right-Wing Blogosphere Credibility:
* they suffered a complete humiliation on their Jamil Hussein "scandal"

* they are forced to retract their John Kerry "dining alone" story in Iraq

* there is a possible, pending humiliation over its Michael Ledeen "scoop" about the death of the Iranian leader

These are the people who have anointed themselves as the "citizen journalist watchdogs" over the "MSM," because the "MSM" is unreliable and only reports events in a way that promotes their political agenda. By contrast, the right-wing blogosphere is here to crusade for accuracy and agenda-free reporting.

We've got Congress. The American people are firmly behind the Democratic agenda. There is growing national and bipartisan consensus that we need to get out of Iraq. And, to top it all off, the conservative wankosphere has shown that it isn't just electorally impotent (how many races did they help win or even make competitive?), but they've proven that they can't even fulfill their self-appointed "watchdog" opportunities.

2007 is off to a great start.

Michael Ledeen features heavily in an article in The American Conservative about neocons and their fellow travellers who are now attempting to rewrite history and claim that they opposed the Iraq war. If only Billmon was around to deluge us with some classic examples of double-speak (though Glenn Greenwald does a good job).

When political leaders make drastic mistakes, accountability is delivered in the form of elections. That occurred in November when voters removed the party principally responsible for the war in Iraq. But the invasion would not have occurred had Americans not been persuaded of its wisdom and necessity, and leading that charge was a stable of pundits and media analysts who glorified President Bush’s policies and disseminated all sorts of false information and baseless assurances.

Yet there seems to be no accountability for these pro-war pundits. On the contrary, they continue to pose as wise, responsible experts and have suffered no lost credibility, prominence, or influence. They have accomplished this feat largely by evading responsibility for their prior opinions, pretending that they were right all along or, in the most extreme cases, denying that they ever supported the war.

Michael Ledeen, a Freedom Scholar at the American Enterprise Institute and a contributing editor to National Review, chose the boldest option. In response to a Vanity Fair article about the swarms of neoconservatives abandoning the administration and the war as both become increasingly unpopular, Ledeen emphatically denied that he backed the invasion in the first place. Writing on National Review’s blog, The Corner, Ledeen claimed, “I do not feel ‘remorseful,’ since I had and have no involvement with our Iraq policy. I opposed the military invasion of Iraq before it took place.”

It is difficult to overstate the audacity—and the mendacity—of Ledeen’s claim. In August 2002, he wrote a scathing article in National Review following an appearance by Brent Scowcroft on “Face the Nation,” in which the former national security adviser argued against the invasion. Ledeen devoted his entire column to mocking Scowcroft’s concerns:

It’s always reassuring to hear Brent Scowcroft attack one’s cherished convictions; it makes one cherish them all the more. … So it’s good news when Scowcroft comes out against the desperately-needed and long overdue war against Saddam Hussein and the rest of the terror masters.

Declaring that “Saddam is actively supporting al Qaeda, and Abu Nidal, and Hezbollah,” Ledeen wrote, “the Palestinian question can only be addressed effectively once the war against Saddam and his ilk has been won.” In response to Scowcroft’s concern that invading Iraq could “turn the whole region into a caldron and destroy the War on Terror,” Ledeen retorted, “One can only hope that we turn the region into a cauldron, and faster, please. If ever there were a region that richly deserved being cauldronized, it is the Middle East today.”

On countless occasions, Ledeen called for the invasion to start as soon as possible. In an August 2002 interview with FrontPage Magazine, when Jamie Glazov asked when the war should begin. Ledeen answered, “Yesterday.”

He appeared on MSNBC’s “Hardball” on Aug. 19 to complain again that the war had not started: “I think that if President Bush is to be faulted for anything in this so far, it’s that he’s taken much too long to get on with it, much too long.”

The following month, in the Wall Street Journal, Ledeen wrote, “Saddam Hussein is a terrible evil, and President Bush is entirely right in vowing to end his reign of terror. If we come to Baghdad, Damascus and Tehran as liberators, we can expect overwhelming popular support. [I]t is impossible to imagine that the Iranian people would tolerate tyranny in their own country once freedom had come to Iraq. Syria would follow in short order.”

While it is difficult to be more dishonest than Ledeen, it is difficult to be more wrong than Charles Krauthammer. ...

Bill Moyers has a piece in Tom Paine called "The Narrative Imperative".

You could not have chosen a better time to gather. Voters have provided a respite from a right-wing radicalism predicated on the philosophy that extremism in the pursuit of virtue is no vice. It seems only yesterday that the Trojan horse of conservatism was hauled into Washington to disgorge Newt Gingrich, Tom DeLay, Ralph Reed, Grover Norquist and their hearty band of ravenous predators masquerading as a political party of small government, fiscal restraint and moral piety and promising "to restore accountability to Congress ... [and] make us all proud again of the way free people govern themselves."

Well, the long night of the junta is over, and Democrats are ebullient as they prepare to take charge of the multi-trillion-dollar influence racket that we used to call the U.S. Congress. Let them rejoice while they can, as long as they remember that while they ran some good campaigns, they have arrived at this moment mainly because George W. Bush lost a war most people have come to believe should never have been fought in the first place. Let them remember, too, in this interim of sweet anticipation, that although they are reveling in the ruins of a Republican reign brought down by stupendous scandals, their own closet is stocked with skeletons from an era when they were routed from office following Abscam bribes and savings and loan swindles that plucked the pockets and purses of hard-working, tax-paying Americans.

As they rejoice, Democrats would be wise to be mindful of Shakespeare's counsel: "'Tis more by fortune ... than by merit." For they were delivered from the wilderness not by their own goodness and purity but by the grace of K Street corruption, DeLay Inc.'s duplicity, the pitiless exploitation of Terri Schiavo, the disgrace of Mark Foley and a shameful partisan cover-up, the shamelessness of Jack Abramoff and a partisan conspiracy and neocon arrogance and amorality. (Yes, amoral: Apparently there is no end to the number of bodies Bill Kristol and Richard Perle are prepared to watch pile up on behalf of illusions that can't stand the test of reality even one Beltway block from the think tanks where they are hatched.) The Democrats couldn't have been more favored by the gods if they had actually believed in one!

But whatever one might say about the election, the real story is one that our political and media elites are loath to acknowledge or address. I am not speaking of the lengthy list of priorities that progressives and liberals of every stripe are eager to put on the table now that Democrats hold the cards in Congress. Just the other day, a message popped up on my computer from a progressive advocate whose work I greatly admire. Committed to movement-building from the ground up, he has results to show for his labors. His request was simple: "With changes in Congress and at our state capitol, we want your input on what top issues our lawmakers should tackle. Click here to submit your top priority."

I clicked. Sure enough, up came a list of 34 issues—an impressive list that began with "African-American" and ran alphabetically through "energy" and "higher education" to "guns," "transportation," "women's issues" and "workers' rights." It wasn't a list to be dismissed, by any means, for it came from an unrequited thirst for action after a long season of malignant opposition to every item on the agenda. I understand the mindset. Here's a fellow who values allies and appreciates what it takes to build coalitions; who knows that although our interests as citizens vary, each one is an artery to the heart that pumps life through the body politic, and each is important to the health of democracy. This is an activist who knows political success is the sum of many parts.

But America needs something more right now than a "must-do" list from liberals and progressives. America needs a different story. ...

The great leaders of our tradition—Jefferson, Lincoln and the two Roosevelts—understood the power of our story. In my time it was FDR, who exposed the false freedom of the aristocratic narrative. He made the simple but obvious point that where once political royalists stalked the land, now economic royalists owned everything standing. Mindful of Plutarch's warning that "an imbalance between rich and poor is the oldest and most fatal ailment of all republics," Roosevelt famously told America in 1936 that "the average man once more confronts the problem that faced the minuteman." He gathered together the remnants of the great reform movements of the Progressive Age—including those of his late-blooming cousin, Teddy—into a singular political cause that would be ratified again and again by people who categorically rejected the laissez-faire anarchy that had produced destructive, unfettered and ungovernable power. Now came collective bargaining and workplace rules, cash assistance for poor children, Social Security, the GI Bill, home mortgage subsidies, progressive taxation—democratic instruments that checked economic tyranny and helped secure America's great middle class. And these were only the beginning. The Marshall Plan, the civil rights revolution, reaching the moon, a huge leap in life expectancy—every one of these great outward achievements of the last century grew from shared goals and collaboration in the public interest.

So it is that, contrary to what we have heard rhetorically for a generation now, the individualist, greed-driven, free-market ideology is at odds with our history and with what most Americans really care about. More and more people agree that growing inequality is bad for the country, that corporations have too much power, that money in politics is corrupting democracy and that working families and poor communities need and deserve help when the market system fails to generate shared prosperity. Indeed, the American public is committed to a set of values that almost perfectly contradicts the conservative agenda that has dominated politics for a generation now.

The question, then, is not about changing people; it's about reaching people. I'm not speaking simply of better information, a sharper and clearer factual presentation to disperse the thick fogs generated by today's spin machines. Of course, we always need stronger empirical arguments to back up our case. It would certainly help if at least as many people who believe, say, in a "literal devil" or that God sent George W. Bush to the White House also knew that the top one percent of households now have more wealth than the bottom 90 percent combined. Yes, people need more information than they get from the media conglomerates with their obsession for nonsense, violence and pap. And we need, as we keep hearing, "new ideas." But we are at an extraordinary moment. The conservative movement stands intellectually and morally bankrupt while Democrats talk about a "new direction" without convincing us they know the difference between a weather vane and a compass. The right story will set our course for a generation to come.

Some stories doom us. In Collapse: How Societies Choose to Fail or Succeed , Jared Diamond tells of the Viking colony that disappeared in the fifteenth century. The settlers had scratched a living on the sparse coast of Greenland for years, until they encountered a series of harsh winters. Their livestock, the staple of their diet, began to die off. Although the nearby waters teemed with haddock and cod, the colony's mythology prohibited the eating of fish. When their supply of hay ran out during a last terrible winter, the colony was finished. They had been doomed by their story.

Here, in the first decade of the 21st century, the story that becomes America's dominant narrative will shape our collective imagination and hence our politics. In the searching of our souls demanded by this challenge, those of us in this room and kindred spirits across the nation must confront the most fundamental progressive failure of the current era: the failure to embrace a moral vision of America based on the transcendent faith that human beings are more than the sum of their material appetites, our country is more than an economic machine, and freedom is not license but responsibility—the gift we have received and the legacy we must bequeath.

In our brief sojourn here we are on a great journey. For those who came before us and for those who follow, our moral, political and religious duty is to make sure that this nation, which was conceived in liberty and dedicated to the proposition that we are all created equal, is in good hands on our watch.

Bill Moyers is also a good commentator on religious matters, so I wonder what he would make of this report at Alternet on "America's Holy Warriors", which is the sort of thing the gives secular types like me the heebie jeebies and reinforces my view that while the "War on Terror" is mostly about oil, there is also an element of 2 fundamentalist religious cults battling it out with each other (Al Qaida and co and the Islamic fundamentalist side and the Dominionist Christian right in the US on the other).

The Economist warned its readers against voting for Bush before the 2004 election because of the fundamentalist maniacs in his base and its a shame more mainstream media organisations didn't echo this. If the US really does end up in the grip of some Pentecostalist cult I wonder where that leaves the rest of the West, given that Europe, Canada, Australia, Japan etc aren't likely to follow the recommendations of a bunch of happy clappy madmen with far too many weapons in their hands (I'm not sure moderate Christians, atheists, Jews and other religions in the US will be too happy about it either). I'm not sure even the most fervent Libertarian would be too keen on the idea of a privatised army run by these guys being the core of the American military in the future either.

The drive by the Christian right to take control of military chaplaincies, which now sees radical Christians holding roughly 50 percent of chaplaincy appointments in the armed services and service academies, is part of a much larger effort to politicize the military and law enforcement. This effort signals the final and perhaps most deadly stage in the long campaign by the radical Christian right to dismantle America’s open society and build a theocratic state. A successful politicization of the military would signal the end of our democracy.

During the past two years I traveled across the country to research and write the book "American Fascists: The Christian Right and the War on America." I repeatedly listened to radical preachers attack as corrupt and godless most American institutions, from federal agencies that provide housing and social welfare to public schools and the media. But there were two institutions that never came under attack -- the military and law enforcement. While these preachers had no interest in communicating with local leaders of other faiths, or those in the community who did not subscribe to their call for a radical Christian state, they assiduously courted and flattered the military and police. They held special services and appreciation days for all four branches of the armed services and for various law enforcement agencies. They encouraged their young men and women to enlist or to join the police or state troopers. They sought out sympathetic military and police officials to attend church events where these officials were lauded and feted for their Christian probity and patriotism. They painted the war in Iraq not as an occupation but as an apocalyptic battle by Christians against Islam, a religion they regularly branded as "satanic." All this befits a movement whose final aesthetic is violence. It also befits a movement that, in the end, would need the military and police forces to seize power in American society.

One of the arguments used to assuage our fears that the mass movement being built by the Christian right is fascist at its core is that it has not yet created a Praetorian Guard, referring to the paramilitary force that defied legal constraints, made violence part of the political discourse and eventually plunged ancient Rome into tyranny and despotism. A paramilitary force that operates outside the law, one that sows fear among potential opponents and is capable of physically silencing those branded by their leaders as traitors, is a vital instrument in the hands of despotic movements. Communist and fascist movements during the last century each built paramilitary forces that operated beyond the reach of the law.

And yet we may be further down this road than we care to admit. Erik Prince, the secretive, mega-millionaire, right-wing Christian founder of Blackwater, the private security firm that has built a formidable mercenary force in Iraq, champions his company as a patriotic extension of the U.S. military. His employees, in an act as cynical as it is deceitful, take an oath of loyalty to the Constitution. These mercenary units in Iraq, including Blackwater, contain some 20,000 fighters. They unleash indiscriminate and wanton violence against unarmed Iraqis, have no accountability and are beyond the reach of legitimate authority. The appearance of these paramilitary fighters, heavily armed and wearing their trademark black uniforms, patrolling the streets of New Orleans after Hurricane Katrina, gave us a grim taste of the future. It was a stark reminder that the tyranny we impose on others we will one day impose on ourselves.

"Contracting out security to groups like Blackwater undermines our constitutional democracy," said Michael Ratner, the president of the Center for Constitutional Rights. "Their actions may not be subject to constitutional limitations that apply to both federal and state officials and employees -- including First Amendment and Fourth Amendment rights to be free from illegal searches and seizures. Unlike police officers they are not trained in protecting constitutional rights and unlike police officers or the military they have no system of accountability whether within their organization or outside it. These kind of paramilitary groups bring to mind Nazi Party brownshirts, functioning as an extrajudicial enforcement mechanism that can and does operate outside the law. The use of these paramilitary groups is an extremely dangerous threat to our rights."

The politicization of the military, the fostering of the belief that violence must be used to further a peculiar ideology rather than defend a democracy, was on display recently when Air Force and Army generals and colonels, filmed in uniform at the Pentagon, appeared in a promotional video distributed by the Christian Embassy, a radical Washington-based organization dedicated to building a "Christian America." ...

The group has burrowed deep inside the Pentagon. It hosts weekly Bible sessions with senior officers, by its own count some 40 generals, and weekly prayer breakfasts each Wednesday from 7 to 7:50 a.m. in the executive dining room as well as numerous outreach events to, in the words of the organization, "share and sharpen one another in their quest to bridge the gap between faith and work."

If the United States falls into a period of instability caused by another catastrophic terrorist attack, an economic meltdown or a series of environmental disasters, these paramilitary forces, protected and assisted by fellow ideologues in the police and military, could swiftly abolish what is left of our eroding democracy. War, with the huge profits it hands to businesses and right-wing interests that often help bankroll the Christian right, could become a permanent condition. And the thugs with automatic weapons, black uniforms and wraparound sunglasses who appeared on street corners in Baghdad and New Orleans could appear on streets across the U.S. Such a presence could paralyze us with fear, leaving us unable to question or protest the closed system and secrecy of an emergent totalitarian state and unable to voice dissent.

"The Bush administration has already come close to painting our current wars as wars against Islam -- many in the Christian right apparently have this belief," Ratner said. "If these wars, bad enough as imperial wars, are fought as religious wars, we are facing a very dark age that could go on for a hundred years and that will be very bloody."

On an optimistic note, Rev Sam at Elizaphanian has answered this years "Edge" question and in his post notes that he thinks evangelical fundamentalism will wane in future.

I am optimistic about two things in the main, and I think they will fold together (indeed, that is really what my talks are about). I am optimistic about life after the great dislocation; and I am convinced that a revival of Christianity has already begun.

1. A High Quality future.

The long term impact of the decline and elimination of fossil-fuel energy sources will be a society which is forced to make do on a small fraction of the energy which present society consumes - my wild-assed-guess is between 20 and 25%. The transition will be frightening and greatly harmful - but I don't see any reason why human civilisation cannot continue beyond that time. Moreover, I think there will be many, many facets of life which will be greatly improved on this basis. In particular:

- I think the car will be eliminated as a majority mode of transportation. There will be new cars usable by the wealthy, but on the whole, transport will be public (buses/rail) or human-powered (bicycle and related vehicles; and walking). This will be an unalloyed joy for humanity.

- I think that vast amounts of the crap currently clogging up our homes and psyches will be eliminated - all the plastic rubbish that is churned out and discarded at a great rate (and tends to be on sale next to the counters in certain shops - just at the right height for children to be tempted). This will be a very good thing. On the other hand, there will be much greater scope for human craftsmanship to revive. Goods will be made to last, and also be made to be easily repairable. There will be lots of new trades to exploit these facts, and lots of industries which exploit the accumulated resource base of useless cars (eg platinum from catalytic convertors).

- entertainment will be much more social and unplugged; we will once more get to know our neighbours and realise what we have been missing; local colour will blossom.

- problems of pollution will radically lessen. The air will be clean and breathable; the illnesses of affluenza (asthma, obesity, ADHD etc) will vanish. People will be just as happy as they are today.

- People will take much greater pleasure in their food, and appreciate biological quality to a much greater extent than they do now. All food will be organic and pesticide free, people will be astonished at how we have put up with shovelling gruel into our bodies for so long.

- We will have shifted away from a growth-obsessed culture; sustainability will be widely recognised and accepted as the aim, and, largely, be achieved.

- The internet, and blogging, will have survived (not unscathed) but we will know ourselves much more intimately, as a single human species, than we do today.

2. A Christian revival

A large part of what will happen through the great dislocation is a rediscovery of the viability and essentiality of religious narrative as the primary structuring principle for human society. I am convinced that there will be a major spiritual revival; I am also convinced that Christianity offers the most fruitful soil for the spiritual revival to flourish within; thus, I am optimistic that over the next fifty years there will be a revival and renaissance within Western Christian life. I believe that a number of major intellectual cycles have come to an end over the last 100 years or so - and that we are about to enter into a time of rich human spiritual flourishing. Specifically:

- The idolatry of science is even now collapsing underneath the weight of its own contradictions. Understanding the causes of the disaster we are about to experience will show in stark relief the limitations of a scientistic approach to the world, and the necessity to ground science in a wider vision of the human good. Science will be seen for what it is: an outstandingly useful tool, but something incapable of giving human or humane guidance for the piloting of our civilisation.

- The Protestant Reformation is over, and will be seen to cease, de facto, if not de jure (the latter depends on the rate of change in the Vatican). As a result of the coming spectacular implosion of US fundamentalism, and a widespread rejection of its tenets, Protestant spirituality will accelerate even further along the road of reclaiming historical (ie catholic) Christian practices. This process has already begun in earnest, in the 'emergent' churches. In particular, the fetishisation of 'the text' will be seen as culturally conditioned, and a product of the widespread acceptance of a new form of technology. As the cultural acceptance of that technology changes and becomes more provisional, so too will the religious understanding of the technology. Once more the Word will be seen as the one made flesh. Of course, the Reformation will end principally because it has achieved its purpose.

- The medieval theological distortions which paved the way for science, schism and atheism (which are conceptually tightly intertwined) will be overcome, and, prompted by this recollection itself, Western Christianity will explode in a burst of exuberant creativity, marked by a reclamation of spiritual integrity and a unified vision of the world and the place of humanity within it. Theology will no longer be prostituted in the academy; the eucharistic community will once more be the centre of gravity for Christian understanding.

- At long last, the Greek inheritance will be sloughed off; Wittgenstein's insights (as well as others) will be culturally accepted; and we will focus our thoughts and energies on matters within this world, recognising and honouring the mystical for what it is, but not seeking to capture (ie restrict) what cannot be spoken in words.

- The secular legacy of Christianity (human rights above all) will be more widely accepted throughout the world as a common basis for human relations; our moral fibre will revive and improve. Human life will be seen as centre of human value: one fully human life will continue to teach us what it means to be human.

~~~

Needless to say, I could be completely wrong in all of the above. Yet these broad trends I see not only as possible but as probable, and as in large part the will of God for us. This is the vision of the future that motivates me and it is what I work towards.

Digg this week pointed to an interesting (but completely wrong) post commenting on the influence of social networking sites like Digg and YouTube and the prominence of stories like this one about a fundamentalist murdering an atheist for "not believing in god".

This commenter pointed out the bleeding obvious:

The author is perhaps unfamiliar with how Digg operates:
"Digg and YouTube are extremely powerful devices to project a message to the masses"

No, that's how TV works. Rather than projecting a message to the masses, the masses (ie Digg members) actually decide through democratic voting, which articles are of interest, and what messages they want to hear. User-generated content is what drives these sites.

As for the term "Atheism 2.0" - stop playing with semantics! Atheism has been around longer than Christianity, and if there was a new version of it recently, I imagine it would have begun with the hippie movement.

The "Murdered for being an atheist" article is about Christian extremism more than it's about atheism. If you are a Christian, you might like to consider why these reports generate so much interest.

Christian extremism should be treated by moderate Christians as a more serious problem than atheism. Extreme Christians, such as Pat Robertson, or the murderer in the previously mentioned article, do not follow Jesus' example of showing love towards enemies, instead they act on hatred and judgement. Christian extremists (particularly in USA) exercise disproportionate levels of control over things like public censorship, education, and politics. If you are a moderate Christian, please be aware that it is the extreme elements that give your religion a bad name - just as extreme Muslims have given Islam a bad name.

Extreme Christians who believe that murder is justified in God's name are NOT followers of Christ. Nor are those who preach hatred, or who make false prophecies etc. They damage the Christian religion more than any atheist could. What atheist would prefer to be full of hate and judgement?

Surely Christians would be better off trying to attract atheists by living Christ-like lives, rather than characterising atheism as a threat to be combatted (while ignoring or tolerating hypocrisy within the church)?

Finally I would like to point out that the conclusion drawn by the author here - that YouTube and Digg combined "become a veritable force that can sway public opinion like few other outlets can" - is not justified in the article. Some of the videos have been seen by 100,000 people, but so what? How has this really swayed public opinion? Is it possible that with the advent of social networking sites where users generate content that you are only now seeing clearly the extent of atheism's popularity? Is it possible that the pressure placed on traditional broadcasting media (ie where the message *is* projected to the masses, with little or no input from the intended audience) by radical and extreme Christian groups has created an illusion of Christianity that does not actually exist in America today?

If you believe the rather sensational headline, that these social networking sites are responsible for powering atheism, perhaps you also believe that people shouldn't be able to choose what they want to read or watch; maybe you would prefer to control what people see, the choices they make and beliefs by which they live.

Cryptogon points to an interesting looking book called "The Creation: An Appeal to Save Life on Earth" by Edward O. Wilson which appears promising as a way of talking to religious people about environmental issues.

This looks useful for anyone interested in appealing to Christians on environmental collapse issues:

With his usual eloquence, patience and humor, Wilson, our modern-day Thoreau, adds his thoughts to the ongoing conversation between science and religion. Couched in the form of letters to a Southern Baptist pastor, the Pulitzer Prize–winning entomologist pleads for the salvation of biodiversity, arguing that both secular humanists like himself and believers in God acknowledge the glory of nature and can work together to save it.

The “depth and complexity of living Nature still exceeds human imagination,” he asserts (somewhere between 1.5 million and 1.8 million species of plants, animals and microorganisms have been discovered to date), and most of the world around us remains unknowable, as does God. Each species functions as a self-contained universe with its own evolutionary history, its own genetic structure and its own ecological role. Human life is tangled inextricably in this intricate and fragile web.

Understanding these small universes, Wilson says, can foster human life. Wilson convincingly demonstrates that such rich diversity offers a compelling moral argument from biology for preserving the “Creation.” Wilson passionately leads us by the hand into an amazing and abundantly diverse natural order, singing its wonders and its beauty and captivating our hearts and imaginations with nature’s mysterious ways.

Past Peak has a post which points out that hundreds of plant species are blooming in mid-winter in the Netherlands.

Today's global warming story. Science Daily:

Observers in the Netherlands reported that more than 240 wild plant species were flowering in December, along with more than 200 cultivated species. According to biologist Arnold van Vliet of Wageningen University, this unseasonable flowering is being caused by extremely high autumn temperatures.

The mean autumn temperature in 2006 was 13.6°C, which is 3.4°C above the long-term average. It was even 1.6°C warmer than in 2005, which was previously the warmest autumn since 1706, when records were first kept. It is very likely that other European countries also experienced unseasonable flowering due to the high temperatures. This information emerged from a unique, large-scale observation campaign conducted by volunteers during the first 15 days of the month. [...]

The aim of the observation campaign was to determine the effects of the extreme weather conditions in the Netherlands during the second half of 2006. This year included not only the warmest July and September on record, but also the wettest August. Temperatures were far above normal: 3.7°C higher in September, 3.3°C higher in October and 3°C higher in November. The first 17 days of December were even more extreme, registering 4.2°C above normal. For the entire autumn the average temperature was 3.4°C above the long-term average and even 1.6°C warmer than the autumn of 2005, which was previously the warmest on record in the Netherlands. [...]

Van Vliet warns that the ecological consequences of the extreme temperatures and the longer growing season remain largely unknown. Next year will be an important year for ecologists to identify the impacts on plants and animals. The high temperatures in 2006 are likely to increase the numbers of warmth-loving species even further, a trend which has been observed for some time.

Meanwhile, Fox News wants us to believe that recent blizzards in Denver cast doubt on global warming. Think Progress:

Today, prominent climate skeptics Pat Michaels and Dan Gainor appeared on Fox News' Your World with Neil Cavuto to argue that the recent snowstorms in Denver prove there is a "Northeast bias" on global warming. Both agreed with Cavuto's claim that if "more of those who support global warming did not live in the East Coast, or more specifically in New York, and were stationed in Denver," they might be more skeptical of global warming.

Michaels added that "if you believe that warming causes cooling, you're like my neighbors down in Virginia who think that if you put hot water in the ice cube tray, it freezes faster. It doesn't work that way."

Of course, global warming models all predict increased precipitation and increased frequency of extreme weather events. Like blizzards. But that's just, you know, science.

Boing Boing points to some endangered snowmen protesting against global warming in Norway.

I briefed my students at Norway's Westerdals Communication on a one-day project today: 'make a wooden object out of plywood and place it somewhere in Oslo.'

"They made this great collection of wooden snowmen, demonstrating in front of the Parlament, asking for a better life situation. We've experienced the warmest winter in 60 years. Norway is really lagging behind when it comes to full filling the Kyoto protocol. The national newspaper, Dagbaldet, ran a story on it.

"One of my students, Ole M Buene, entered it on his blog and posted a Flickr set.

I'll close with an article from The Guardian about one man's quest to travel around Ireland speaking only Gaelic (yes, its rather off-topic, but I once read an article by the CEO of an Irish IT company that noted that the unique features of Gaelic made it very conducive to producing high quality computer programmers - one more advantage of diversity in a world requiring a myriad of specialisations).

Gaelic is the first official language of Ireland, with 25% of the population claiming to speak it. But can that true? To put it to the test, Manchán Magan set off round the country with one self-imposed handicap - to never utter a word of English

There is something absurd and rather tragic about setting out on a journey around a country, knowing that if you speak the language of that country you will not be understood. It is even more absurd when the country is your native one and you are speaking its native language.

Irish (Gaelic) is the first official language of Ireland. We have been speaking it for 2,500 years, right up until the British decided it would be easier to govern us if we spoke their language (and then outlawed the use of Gaelic in schools) in the 19th century. We, in turn, soon realised that our only hope of advancement was through English, and we - or at least the half of the population that survived the Famine - jettisoned Irish in a matter of decades. Had it not been for the Celtic Revival that accompanied Ireland's fi ght for independence in the early 20th century, the language would have probably died out by now. Today, a quarter of the population claim they speak it regularly. I have always suspected this figure and to test its accuracy I decided to travel around the country speaking only Irish to see how I would get on.

I chose Dublin as a starting point, confident in the knowledge that in a city of 1.2 million people I was bound to find at least a few Irish speakers. I went first to the Ordnance Survey Office to get a map of the country. (As a semi-state organisation it has a duty to provide certain services in Irish.) "Would you speak English maybe?" the sales assistant said to me. I replied in Irish. "Would you speak English?!" he repeated impatiently. I tried explaining once again what I was looking for. "Do you speak English?" he asked in a cold, threatening tone. "Sea," I said, nodding meekly. "Well, can you speak English to me now?" I told him as simply as I could that I was trying to get by with Irish.

"I'm not talking to you any more," he said. "Go away."

...

I knew the journey was going to prove difficult, just not this difficult. Language experts claim that the figure of fluent Irish speakers is closer to 3% than the aspirational 25% who tick the language box on the census, and most of these are concentrated on the western seaboard, in remote, inaccessible areas where one would not naturally find oneself. What I had not factored for was the animosity. Part of it, I felt, stemmed from guilt - we feel inadequate that we cannot speak our own language.

I decided to contact a talk radio show in Dublin to ask the listeners what they thought. A few phoned to say that they had no idea what I was talking about. "Is the language dead? I asked in Irish, over and over again. "Sorry?" most of them replied, or: "You what? Are you speaking the Irish?" Some of the callers wanted me and my bog language pulled off the airwaves, others talked of their shame at not being able to understand me and of how much they admired me for speaking out. This in turn made me feel guilty: the only reason I speak Irish is because my grandmother went to the trouble of learning it 90 years ago as a weapon in the struggle for an Irish republic. She then bribed me as a child with sweets and treats to go on speaking it when I realised that none of my friends did. In fact, I had almost discarded it, regarding it as a dead weight around my neck, until TG4, the Irish-language television station, was set up in 1996 and I started making travel documentaries for it.

After the radio show, I decided to visit the tourist office which, presumably, was used to dealing with different languages. The man at the counter looked at me quizzically when I inquired about a city tour. "Huh?" he said, his eyes widening. I repeated myself. "You don't speak English, do you?" he asked coldly. I was beginning to hate this moment - the point at which the fear and frustration spread across their faces. They were just trying to get through the day, after all. They did not need to be confronted by an unbending foot soldier of the Irish Taliban.

I explained what I was trying to do. "Well, mate, I don't actually speak Irish, so ... " he paused menacingly and I tried to smile encouragingly, "so, If you speak English, I'll be able to understand what you're saying."

"Béarla only - English only," said his supervisor, standing sternly behind him, repeating it a second time in case I was slow. I asked if there was any other language I could use and they pointed to a list of seven flags on the wall. To be honest, I could speak five of them but I had promised myself not to, not unless it was absolutely necessary. Eventually they located a charming young woman who spoke perfect Irish and was able to tell me everything I needed to know, but she was terribly nervous, believing her vocabulary to be inadequate. It was not; it was wonderful. It is an odd tendency that people often have an erroneous view of their ability to speak Irish, either over- or underestimating their ability - possibly a convoluted psychological legacy of the stigma attached from days when it was a sign of poverty and backwardness.

I might have been tempted to give up the journey entirely had it not been for something that happened during the radio phone-in. I was rapidly approaching a point of despair when some children came on the line. I found they spoke clear and fluent Irish in a new and modern urban dialect. They told me how they spoke the language all the time, as did all their friends. They loved it, and they were outraged that I could suggest it was dead. These were the children of the new Gaelscoileanna - the all-Irish schools that are springing up throughout the country in increasing numbers every year. While old schools are being closed down or struggling to find pupils, the Gaelscoileanna are having to turn people away. The phenomenon is as popular among the affluent middle classes as it is in working-class estates, largely due to the excellence of the education: Irish-speaking secondary schools often score higher in state exams than the most elite fee-paying schools. The students come away unburdened with the sense of inferiority that every previous generation had been instilled with since the days in which the British first labelled Irish as backward.

These children were reared on Irish versions of SpongeBob SquarePants and Scooby-Doo on TG4 . They had invented Irish words for X-Box and hip-hop, for Jackass and blog. They were fluent in Irish text-speak and had moulded the ancient pronunciations and syntax in accordance with the latest styles of Buffy-speak and Londonstani slang. I realised it was they I should have turned to for help on the streets. The children filled me with renewed confidence as I left Dublin and took to the road, boosted further by my first experience in a petrol station where a Polish attendant had no problem deciphering the complicated mechanical query I had about my borrowed vintage Jaguar. For him, every day involved a struggle to understand a foreign language, and whether I was speaking Irish or English made little difference. In fact, everyone I met over the course of the next 1,000 miles driving around the country were more approachable and considerate than those first few Dubliners. Not that I am claiming they all had fluent Irish - far from it - but they were willing to engage with me, to string together the few stray words of school Irish that arose from the darkest recesses of their minds, or else to try to decipher my miming and mad gesticulation.