By Dean Fantazzini, Mikael Höök, The Oil Drum
Abstract: The Deepwater Horizon incident demonstrated that most of the oil left is deep offshore or in other locations difficult to reach...In this regard, the physical limitations on producing ever-increasing quantities of oil are highlighted, as well as the possibility of the peak of production occurring this decade. The economics of oil supply and demand are also briefly discussed, showing why the available supply is basically fixed in the short to medium term. Also, an alarm bell for economic recessions is raised when energy takes a disproportionate amount of total consumer expenditures. In this context, risk mitigation practices in government and business are called for.