Philippines Economic Collapse – Scenario

We are probably well aware that gasoline is derived from crude oil by separating it out in a refinery. Crude oil, in turn, is pumped from underground reservoirs, which are generally believed to have taken millions of years to form. As such, oil is considered NOT renewable source of energy because it is finite in quantity.

International Data Base, February 2003, Energy Information Administration, shows the WORLD TOTAL ENERGY CONSUMPTION for year 2001 (Latest available data) alone is 13,934,100,000,000 KwH. The United States, alone, burns 21,000,000 barrels of fuel per day for their power production.

Presently, the recent seemingly unabated fuel price hike is mainly due to China’s fuel demand to spur the 5.7% growth, and of course, that of India. The unstable market condition is brought about only by two large nations, who are not using the wheels yet – not so normal demand. What will happen if all advanced countries in the world start the hoarding of fossil fuel?

NEWSWEEK, September 13, 2004, page 37 “As the age of the oil wanes, what will take its place? This is a very serious question that all nations great and small should seriously ask now, not tomorrow, and certainly not when the oil crunch has already come. Not when all fossil fuel firing power plants that run the Nation’s industries become useless in the very near future, and definitely not, when oil becomes a rare commodity in the global market.

NEWSWEEK cover page FUTURE OF ENERGY, April 15, 2002. “The Energy Squeeze”, page 46, SHELL Research Laboratory, Geologist M. King Hubbert had done statistical analysis on U.S. oil supply. Hubbert’s insight was that the curve of production plotted over time formed the beginning of a bell curve. One of the characteristics of a bell curve, of course, is that after rising for a time, it eventually peaks then turns downward. Applying the technique to the world oil supply, Kenneth Deffeyes, M. Kin Hubberth’s assistant at the Shell Research Laboratory, was shocked to find the peak not decades away.

You might ask, what do these facts tell us? It’s very clear, if the Bell’s Curve proves to be correct, that the peak oil production will be within four (4) years, then, it will begin to decline. Fossil fuel demand will outpace production resulting to a slowly rising oil price, as what is happening now. Somewhere along the down trend curve, the panic point will be reached, wherein all nations great and small will start the hoarding of oil. Panic buying will occur that small oil producing nations will produce but will not sell. The pandemonium scramble to buy and hoard fossil fuel from a slowly dwindling oil supply in the global market will drive the price of oil sky-high. A “Buy-Diminish Oil Supply” vicious cycle will occur. The more you buy, the more fossil fuel becomes scarcer.

The production of power derived from fossil fuel (thermal sources) will become very expensive, resulting to massive brownouts. Industries of poor countries including that of the Philippines will be forced to COLLAPSE. OUR NATION THEN WILL BEGIN TO DIE. This will put the Filipinos in the tight clutches of dire poverty, to endure so much suffering, and the stigma that goes with being poor.

The economy of Korea and Thailand are progressive today, rebuilt by the population’s selfless love for country, contributed money and their personal jewelry to jump-start their economy.

If we Filipinos remain to be callous to forsake love for country in lieu of personal gains; the Philippines as a nation cannot be expected to survive!

Isidro Umali Ursua
Mabfi President