POLS 333 Lec 81 The Oil We Eat

POLS 333 Lec 8 2 Black Gold  Versatile, convenient, cheap & powerful  3 spoonfuls = 8 hours manual labor 20 gallons = 2 years!  Fourfold increase in pop. since fold increase in yield per acre  10-fold increase in midwest corn yields 80-fold increase in energy inputs  US: 60% farming in 1900, 2% today

POLS 333 Lec 8 3 World energy markets  Oil: Glue of global economy 37% of all energy, 42% of CO2  GDP growth correlates to oil use  86 MBD in 2010, 2% growth rate (IEA) 2007 = production peak  2/3 reserves in Persian Gulf Major OPEC producers are big food importers Saudi: more than N. & S. America, Europe & former USSR combined (?)

POLS 333 Lec 8 4 Patterns of consumption  U.S. led petroleum economy (1859) 5% population, uses 25% world ’ s oil  1/2 efficiency of Japan & W. Europe Response to 1973 & 1979 price hikes: high taxes, massive investment in mass transit  “ The American way of life ” 5x world per capita oil consumption Car culture, suburbia, cheap food

POLS 333 Lec 8 5 The Food/Oil Connection  17% of US oil consumption  Roughly equivalent to personal driving  Fertilizers + refrigeration more than transport 11 cal. energy  1 cal. food  Petroleum-based fertilizers, pesticides 1 ton of oil  1.5 tons nitrogen fertilizer  Wheat/Oil Exchange Rate From 1:1 (1973) to 14:1 (2006) U.S. imports: 2% in 1940, 55% in 2005

POLS 333 Lec 8 6 Interstate Highway System

POLS 333 Lec 8 7 Mode of Transport BTU per ton-mile Class 1 Railroads341 Domestic Waterborne510 Heavy Trucks3,357 Air freight (approx)9,600 … food miles? Check out:

POLS 333 Lec 8 8 “ Peak Oil ” Hubbert predicted U.S. peak (1970) in 1956 US discoveries peaked in 1930 Depends upon estimate of reserves  Colin Campbell, Shell Production has outrun discovery for 30 years 1.8 trillion barrels >  USGS: 3 trillion barrels > 2030  IEA (2006): : 2006

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10 US Crude-Oil Production  Production is bell-shaped, like the curves Hubbert drew  Average price after the peak is 2.6 times higher than before 10 Price Production

POLS 333 Lec 8 11 Mexico Was the #2 supplier of oil to the US Now is #4 Cantarell from >2,000 in 2005 to 860,000 in Jan 2009 to 588,000 in July 2009 Both Mexico & US are in trouble. Mexico: Sale of oil = 40% of federal budget US: Net exports go to 0 in ~2014

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POLS 333 Lec 8 13 Rising Cost of Oil  Price volatility  Before 2003, 1979 was highest: $100 (2003 $)  1998: $10/barrel  2006: $ : $75 Today: $104  Confluence of factors  Increased demand  3.4% in 2004, double the usual  China consumption growing by nearly 10%/year  DC demand: transport, diet  Recession: a mitigating factor  Decreased imports in US

POLS 333 Lec 8 14 Source: International Energy Agency, World Energy Outlook 2010.

Shale oil Extracted from rock; high temps. ~3 trillion barrels global reserves Oil sands Heavy crude; Canada & Venezuela ~1.2 trillion barrels (est.) Hydraulic fracturing (natural gas) Particularly relevant to agriculture IEA (2013): US energy independence by 2035 #1 “oil” producer by 2020! BUT: Unconventional Hydrocarbons!

Source: mongabay.com using 2009 data from Energy Information Administration Renewable energy trends

Is it enough? Source: (from IEA data) U.S. energy consumption (2007)

POLS 333 Lec 8 18 World food crisis 2008: High oil prices > biofuel subsidies > hunger 1/4 U.S. corn > ethanol ($.45/gallon subsidy)  Intervening variables Trade liberalization & subsidies Financialization  Food as % of income US = 11%; 16% for poorest 20% DCs = 40-70%  UN Special Task Force: “ US & EU biofuels policies are irresponsible ”

POLS 333 Lec 8 19 Food production & climate change

POLS 333 Lec 8 20 Projected impacts of climate change on agriculture (2080)