Fossil fuels are created out of organic matter, by applying eons of pressure deep inside the earth to the remains of dead plants and animals. The result can be coal, petroleum, or natural gas. They all can be converted into energy with great efficiency, making them the most effective fuels ever discovered.

In considering the quality of a fuel, the relevant measure is not simply how much energy the matter can yield, but how much energy it yields compared to the energy invested in getting it. This ratio is known as ERoEI, energy return on energy invested. On that score, fossil fuels were once unmatched. Petroleum once had an ERoEI near 100:1 ie. for the energy equivalent of 1 barrel of oil, you could extract 100 barrels of oil. But oil extraction is subject to diminishing returns, and the ERoEI of fossil fuels has been dropping massively.

The ERoEI changes based on how difficult and expensive that barrel of oil becomes to extract. The first oil reserves we extracted were the largest ones, those nearest the surface and/or those under pressure--often bubbling up all on its own. This oil was the lightest (meaning it had fewer impurities) and sweetest (less sulphur), which made it the easiest to refine. As these reserves were depleted, the pressure inside them dropped, and energy needed to be exerted on the reserve to move the oil up. This oil deeper in the earth tended to be heavier and more sour, which meant that not only did it take more energy to extract, it also took more energy to refine. Eventually, those reserves ceased to be economical, well before all the oil was exhausted. New reserves needed to be found, but these were obviously inferior. They were smaller, or they were deeper, or they weren't under any natural pressure, or any combination of those three. They started off less efficient and, like the original reserves, grew less economical as extraction proceeded.

The first to notice this phenomenon was M. King Hubbert, a geophysicist who worked for Shell from 1943 to 1964. In the 1950s a US geologist working for Shell, M. King Hubbert, noticed that oil discoveries graphed over time, tended to follow a bell shape curve. He posited that the rate of oil production would follow a similar curve, now known as the Hubbert Curve (see figure). In 1956 Hubbert predicted that production from the US lower 48 states would peak in 1970. Shell tried to pressure Hubbert into not making his projections public, but the notoriously stubborn Hubbert went ahead and released them. In anycase, most people inside and outside the industry quickly dismissed Hubbert's predictions. In 1970 US oil producers had never produced as much, and Hubbert's predictions were a fading memory. But Hubbert was right, US continental oil production did peak in 1970/71, although it was not widely recognized for several years, only with the benefit of hindsight.

No oil producing region neatly fits bell shaped curve exactly because production is dependent on various geological, economic and political factors, but the Hubbert Curve remains a powerful predictive tool.

Peak Oil is the moment at which we have extracted half of all the oil in the world--meaning another half remains. But the first half was light, sweet crude in large reserves near the surface and under pressure; the second half is heavy, sour crude in small reserves deep inside the earth where we must apply our own pressure. It is the half that costs more to obtain, but continues to deliver the same benefit as before. When it takes a barrel of oil to obtain a barrel of oil - when petroleum's ERoEI declines to 1 - then it doesn't matter how much oil is still left, the petroleum age is over.

The implications of that are profound and far-reaching. Food is oil - every single calorie we eat is backed by at least a calorie of oil, more like ten. In 1940 the average farm in the United States produced 2.3 calories of food energy for every calorie of fossil energy it used. By 1974 (the last year in which anyone looked closely at this issue), that ratio was 1:1. And this understates the problem, because at the same time that there is more oil in our food there is less oil in our oil. A couple of generations ago we spent a lot less energy drilling, pumping, and distributing than we do now. In the 1940s we got about 100 barrels of oil back for every barrel of oil we spent getting it. Today each barrel invested in the process returns less than ten.

Any economy can ultimately be understood purely in terms of energy transformations, and fossil fuels are the foundation of any industrial civilization. Industrial society itself is a product of cheap petroleum. As demand outstrips supply, we will find ourselves in urgent need of some other source of energy. The prospects for that are grim, to say the least. Most of the most promising "alternative fuels" suffer from some debilitating drawback. For instance, the energy that goes into producing a single photovoltaic cell drops its ERoEI to an estimated 1. Hydrogen cells are energy carriers, not energy sources. And Brazil's experiment with wide-spread biodiesel yielded very ambivalent results.

There is much debate over when global peak oil will occur and what it will mean. The peak of U.S. oil production in 1971 was the most significant event of the post-war era. Many of the vested interests now - including large American oil companies and Middle East monarchies - have a long record of deception with regard to their official numbers. Earlier estimates gave us another ten or more years to figure out what to do, but those estimates proved to be based on the over-reported reserves of Shell and Saudi Arabia. An increasing number of experts are suggesting that we may be at peak right now.

This year's hurricane season may have caused a sufficient "bump" in production that we are now seeing the highest numbers we ever will. Saudi Arabia, the world's second largest supplier of oil (behind Russia), has been exporting crude oil that is increasingly heavy and more sour, to the point where they have experienced problems finding a buyer for it. Rumors persist that the Ghawar Superfield, the centerpiece of Saudi oil, has peaked.

Since peak oil in the USA, their increased dependence on foreign supplies has forced the United States to back many unsavory dictators and tyrants, or else allow economic recession. That U.S.-backed despotism led to many myriad resistance movements against our heinous allies, including the Ba'athists in Iraq and Syria, Mubarak in Egypt, Turkey, Algeria, and others. The goal of al-Qa'ida is to unite the local resistance movements into a pan-Arabic revolution with a short-term goal of destroying the countries that now dominate the region (being the legacies of arbitrary colonial divisions, and ruled by ruthless, Western-backed dictators), and a long-term goal of replacing them with a single caliphate. Al-Qa'ida focuses its ire on the United States because it is the common enemy of all of these local resistance movements, though in each case only a secondary one.

Al-Qa'ida's "rallying cry" to the Islamic world was sounded on 11 September 2001, and immediately appreciated as carte blanche by a far-sighted, visionary but ultimately ruthless group in American politics, the so-called "neoconservatives." Disciples of Leo Strauss, their political philosophy unites a Hobbesian worldview with avowedly Machiavellian pragmatism. With Saudi Arabia's reserves nearing their peak, these "neocons" saw an opportunity in 9/11 to sieze the resources the United States requires before we reach crisis levels, and prepared an invasion against our erstwhile ally, Saddam Hussein. The current war in Iraq, like every war in history, is about resources--in this case, the only resource that still matters: oil. The neoconservatives should be congratulated for their far-sighted preparations, if not for their ruthless lack of morality. Such is the cost of an industrialized civilization. As such, the invasion of Iraq may be seen as the first of the "oil wars" that so many have predicted to break out in the shadow of Hubbert's Peak.

While the world fights for the last few drops of good oil, though, the larger question seems to go unaddressed. Peak Oil is not such a unique problem. In fact, we have repeatedly faced the essential crisis with successive fuels throughout the history of civilization. In each previous iteration, we were saved by an alternative which, while initially considered inferior, proved to have just as high an ERoEI--or, often, higher--as the fuel it replaced. Peak Oil has a strong possibility of bringing down civilization itself as a proximate cause of collapse, but it is by no means certain. This crisis has been averted in the past, and we might avert this one, as well. But with low research budgets and little interest in alternative fuels, that hope is becoming increasingly dim. In all previous iterations, there was, at this point, already a clear alternative in play. We have no such clear alternative. The closest we have to such an alternative is nuclear power, which will give us, at most, another 50 years. Nuclear power uses very little uranium, but there is very little uranium in the world.

Peak Oil does not ensure collapse, just as the timber crisis England and France faced did not ensure their collapse. That said, we should be deeply concerned, because where they had coal, we have nothing. In all previous cases, the alternative that prevailed was already known and widely available before the situation reached crisis levels. Not only do we not have that, but very little has been put into research and development efforts to develop such alternatives. Overwhelming resources will be needed, too. Not only is our need for an alternative no guarantee that it exists. So we see once again that the immediate problems posed (in this case, Peak Oil) are not so critical in and of themselves, but because of the larger context of complexity's diminishing returns, becomes unsolvable.

Cornucopians discount the threat Peak Oil represents by insisting that the market will adapt. Of course, they are correct, but they suffer a failure of imagination to consider what the market's adaptations might include. Genocidal warfare is a very efficient way to reduce demand, for example. As Tainter highlighted in Collapse of Complex Societies, collapse is an economizing process.

History warns us that when once-powerful societies collapse, they tend to do so quickly and unexpectedly. That shouldn't come as much of a surprise: peak power usually means peak population, peak needs, and hence peak vulnerability.