Peak oil and oil vulnerability: what are the implications for industrial agriculture and rural communities? with a case study based in the Southern Gulf region of Queensland

Abstract

Modern agriculture’s high levels of production and global markets have been made possible through vast inputs of fossil fuels for machinery, transport, fertilizer, chemicals, crop and processed food production. Consequently, the peaking and depletion of oil, which eventually will be followed by gas, will challenge how we both produce agricultural output and live in rural and remote Australia. Current analysis estimates that maximum global oil production will plateau before supply begins to decline at a rate between four and six percent per annum by the end of this decade. Despite the imminent decline of global oil production, Australia’s academic research and responsive government policy and planning development for this event has been marginal. Agricultural production methods and rural and remote communities will need to adapt to these changes, which will take place in varying ways depending upon production/industry type, location and community resilience. Rural society has already been challenged by decades of neoclassical economic policy, structural adjustment, population decline, environmental degradation and climate change induced drought. Oil vulnerability introduces another layer of change that will seriously alter rural and remote Australia’s ability to remain viable. This research explores the question of oil vulnerability presented by the peaking of global supply both at a macro level and through a case study focussing on a remote community in North West Queensland. It assesses the current academic literature about oil supply (both globally and nationally) and looks at the effects of plateauing oil supplies and predicted decline rates as oil production moves into the depletion phase. This research identifies the role of oil as a primary component of our economy and society; points to challenges rural Australian society will face and gives a timeframe for changes in oil availability. It reviews the literature around the economic role of oil in the Australian economy and its use in modern agriculture. This thesis further reviews the state of peak oil/oil vulnerability analysis and policy development at all three levels of government and finds that it has been very limited or in active denial of the immediacy of this event. The research then attempts to contextualise both oil vulnerability and the absence of policy signals via case study interviews from a remote rural community, examining its oil use and oil vulnerability. The participants’ high fuel usage, limited understanding of the risks associated with oil dependency and minimal risk management confirmed their vulnerability to oil depletion and consequent price increases. They identified that the lack of leadership and information from both state and federal governments limits the capacity for more active community identification and risk management planning. Despite this the participants were confident that the regional resources available combined with their skills, attitudes and self-reliance learnt through living and working in a remote region would enable them to survive substantial structural change.