Famed geophysicist and grandfather of the modern day peak oil movement, M. King Hubbert, said the science of energy and matter is incompatible with our economic system. For the past two centuries, energy and resources have experienced exponential growth fuelling a burgeoning population and economy; this cannot continue. Hubbert called exponential growth an aberration. It is unsustainable. Finite resources such as oil and other non-renewable energy resources will reach their peak extraction rates and decline in supply. Economic growth, however, is locked in by our debt-based monetary system and reinforced by corporate globalization and consumer culture.

Many experts now think that oil prices will double or triple by the end of the decade. As the demand for oil grows, the upward trend of prices will accelerate and become increasingly volatile to the extent that supply is not able to keep up. This, of course, will be drastically exacerbated when global oil extraction peaks which many experts believe will occur within the next decade.
Regardless of when the exacerbating factor of peak oil kicks in, industrial society faces a challenging new paradigm of unstable and expensive energy markets and higher prices for products. Oil accounts for 40% of global energy consumption and is used to some extent in the extraction and transport of all commodities and the manufacture and/or transport of virtually all products. Rising oil prices will almost certainly trickle down into significantly higher costs for most commodities and products. High volatility in oil prices (and as a result in commodity markets) will cause immense problems for manufacturers trying to maintain some measure of predictability in their financial affairs.
Are we industrial citizens prepared? What is the level of preparedness of the cities and towns we live in for escalating energy prices and possibly supply disruptions? To what extent are we prepared to pay much more for fee-based municipal services such as water, sewage, and trash collection? To what extent can municipalities afford much higher costs for general fund based services such as police, fire, and emergency services?

Is your municipality prepared for oil at $161 per barrel?

In a June 2005 scenario exercise dubbed "Oil Shockwave", real-life former top U.S. officials convened as members of the president's Cabinet to respond to escalating energy crises, culminating in $5.32-a-gallon gasoline and a world economy wobbling into recession.[1] The exercise was developed by Securing America's Future Energy and the National Commission on Energy Policy as series of Cabinet meetings over a seven month period for advising the President how to respond to small incidents of political unrest and terrorism. It was found that the resulting oil supply reductions of less than 4% would cause prices to rise dramatically to more than $161 a barrel. “The real lesson here [is that] it only requires a relatively small amount of oil to be taken out of the system to have huge economic and security implications,” says Robert M. Gates, Oil Shockwave National Security Advisor and former CIA Director.

In the last several years, the growing demand for oil fuelled by China, India, and the United States has gobbled up global excess oil extraction capacity; hence the recent escalation of oil prices and large price increases due to relatively small incidents such a pipeline bombings and kidnappings. While such incidents often do take some crude off the global market, until only recently did they cause sharp price increases. To add to the precarious situation, today’s oil supply is potentially subject to an unprecedented array of geopolitical-, ecological-, and geological-driven events that could cause significant shortfalls in energy supply, including but not limited to: