Patrick Schwerdtfeger is a motivational speaker who can speak about renewable energy and peak oil within the free market system at your next business event. Contact us to check availability. The full transcript of the above video is included below.
Full Video Transcript:
Hi, and welcome to another edition of Strategic Business Insights. Today we’re going to talk about oil and what should we do about oil with respect to renewable energy. And here’s the thing: We need to develop renewable energy resources. I mean, we need to very, very badly. There are documentaries out there, there are some right on YouTube, and I highly recommend you search for some of them, search for peak oil, you can watch some of these documentaries, it is astonishing.
This is coming our way. Oil will run out, and what now? It may not happen soon but it’s going to happen, and along the way the price of oil is going to go up like crazy. And when it runs out, we’ve got a lot of problems because our entire infrastructure, as not just the country but as the entire world, depends heavily, heavily, on oil and petroleum by-products.
Like just as an example, the Green Revolution of the sixties and seventies, that was basically the introduction of ammonia-based fertilizers. Ammonia-based fertilizers are a by-product of oil. It’s a petroleum by-product, and listen to this: It increases the harvest of land depending on the crop and where it is on the earth by up to 600%. That means that once oil is too expensive and those ammonia-based fertilizers are too expensive, that means that the yield, given a plot of land, is going to go down by like 80-plus percent. We’re going to end up with less than 20% of what we had originally. That’s very, very scary, what’s coming our way.
Now, with respect to renewable energy, as the price of oil goes up, the incentive is going to increase to find other renewable sources and develop those sources. Now, I would love to be able to say, “Look, we can just tax the heck out of gas and re-divert that money into research.” That does work, by the way, and United States has almost no tax on gasoline. You go to any other developed nation in the world, Europe or Canada or Australia or Japan, gasoline is way more expensive than it is here because they tax the gasoline. The problem is we haven’t done it so far. So if you introduce a tax now on gasoline, you’re going to have a massive public outcry and protest. Unfortunately, it’s just not feasible.
But the free market will solve this in its own way, because as the availability of oil goes down, and the demand of course is still going up—just hear me out on this. We’re talking about a liquid that you pump from under the ground, you can store it at room temperature, and you can drive a car on it. Listen, nothing will ever replace oil. Nothing. Nothing is as convenient and as energy-rich as oil. Nothing else is going to replace it – natural gas, all the petroleum by-products.
So when the price starts going up, and it will, because when oil is less available then demand’s going to keep going up, because it is a miracle liquid—oil is a miracle liquid. It has allowed the development of our entire globe for the past hundred years and it’s going to continue to fuel it for the next hundred. But believe me, a hundred years from now, the price of oil is going to be high. Peak oil is probably going to happen sometime between now and 2020, 2030, 2035. The peak oil in terms of when the discovery of new oil, it peaked like back in the seventies, and now the amount of discovery is just going down and down and down. It’s a bell curve, and you can draw the exact same bell curve of the usage of oil. It’s just a certain number of years past the discovery. We’re right at the top, and it’s going to start coming down the other side. So when it starts coming down the other side, the price is going to go up like crazy.
We think it’s expensive now at 4 or 5 dollars a gallon. Let me tell you, when this thing starts seeing 10-, 15-dollar-a-gallon gas, I mean, I don’t know how fast it’s going to get there, but it’s going to come. And when it comes, the incentive is going to be there through the free market system to develop other forms of energy, alternative renewable energy sources. So the free market will provide for this.
And there’s another thing to note, by the way, is that people think we’re not really drilling as much as we could in Alaska or off the coasts, particularly off the California Coast, there are restrictions—although by the way, some people think Obama’s been like anti-oil. The reality is that he’s actually issued more licenses for oil-drilling off the coast than his predecessor by a lot. So he’s actually been pro-energy in a lot of ways. I’m not necessarily an Obama lover, but the partisan politics is so skewed that they’re basically just lying on both sides. There’s no foundation in reality. The arguments are so silly.
But in any case, to think that we’re not eventually going to tap into those resources of oil is naïve. Every drop of oil that is on this planet will get harvested at some point. I guarantee it. It is the miracle liquid that is so high in energy, and as the technology advances and we get better and better at extracting the oil, whether it’s through fracking or all these different technologies to get the oil out—like there was a time where, let’s say there’s a discovery of whatever, a billion barrels of oil, you get the first 500 million out, that next 500 is very hard to get at. Well, the technology has improved, and so now we have access to that, and it costs more to get it out but we do have ways of getting it out.
But all the Alaska reserves and the reserves off the coasts, it’s all going to get harvested eventually. Sooner or later, all of that oil is going to get harvested. So just know that that’s coming. The legislation isn’t there today, but eventually, believe me, if it’s like 10-dollar-a-gallon gas, they’re going to open up Alaska in a heartbeat, and it’ll be public demand that forces the action. So all of that oil will eventually get harvested.
But at the end of the day, the message behind this video is, look, nothing’s ever going to replace oil, and secondly, the free market will provide incentives to develop renewable energy sources to one day hopefully replace oil, but the last point is that it might already be too late. In terms of the damage we’ve done, to the planet and the ecosystem, and the amount of energy that we rely on just to feed ourselves, like we’re at 6-1/2, 7 billion people right now, but we’re supposed to be at 9 billion by 2050—and again, keep in mind, when those fertilizers are no longer cost-prohibitive to use them, the yield on the land is going to go down by up to 80% or even more in some cases.
So we’ve got a lot of problems coming and there’s no easy solution, and I highly recommend you watch some of those documentaries. Again, search for peak oil on YouTube and there are a number of documentaries that you can watch by the National Geographic and other sources, and some of them are really, really fascinating and I encourage you to watch them.
Thanks for watching this video. I appreciate it. My name’s Patrick, reminding you to think bigger about your business, think bigger about your life.
Patrick Schwerdtfeger is a keynote speaker who has spoken at business conferences in North America, South America, Europe, Africa, the Middle East and Asia.