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Now that things have quieted down for today, it’s time for a round-up of the coverage and reaction to the GAO’s report on peak oil. The GAO site has online PDFs for:Full report (1.1 MB, 82 pages) / Abstract / Highlights

Alternate sites for the full report: EV World and here

Energy Bulletin published an HTML version of the highlights of the GAO report, with about a dozen pages of important quotes and graph.

Simmons on CNBC

Simmons quotes:
“We are on the verge of replacing the term ‘global warming’ with the term ‘peak oil.'”
“The best new oil basin we will ever find is the one called ‘conservation.'”
(29 March 2007)
Hat tip: TOD. For discussion, go to their thread on the broadcast.

U.S. Unprepared For Oil Supply Crisis: Government Report

As crude oil prices surge on rising political tensions with Iran, a new government report released Thursday said that the U.S. is unprepared to face an oil supply crisis and urged U.S. policymakers to develop a strategy in order to reduce potential risks related to an oil shock.

The report from the U.S. Government Accountability Office concluded that the U.S. has no plans in place to address “peak oil,” the future point in history of maximum oil production, which would be followed by irreversible declines in oil fields around the world.

…An expert told CNBC on Thursday that peak oil is the “the single biggest issue to threaten sustainable society” in the United States.
(29 March 2007)

GAO Peak Oil Report Thread

The Oil Drum
Stuart Staniford writes:

I think this report is real progress. It’s an even-handed summary of the debate, recognizes that the issue is potentially very important, and says the US govt should be doing a lot more to reduce the uncertainties and respond despite the uncertainties. I think this is a huge improvement from the EIA AEO’s and the like, which essentially have a “no worry” message. The message here is “Worry!” I also like that the various demand-side alternatives discussed are all ones worth discussing (no “rebuild the railroads”), and that the challenges to rapid implementation of any alternative are discussed in a reasonably balanced manner. I also liked the pervasive discussion of the fact that these things need to be thought of light of the global warming implications (they even used “global warming” instead of “climate change”!) I thought the arbitrage between food prices and gas prices implied by ethanol should have gotten more play, however.

This is much more important than the Hirsch report, because it’s not a contractor-done “Opinion of the authors only” thing. A very credible piece of the government has just officially endorsed that this is a huge issue. (And thus that I haven’t been throwing away my reputation for nothing these last two years, and I’m happy about that).

I don’t endorse exactly where the center of gravity of the report is (My reading of the evidence is that we are more-or-less at peak already, but I also think adaptation is not going to be as hard as some people think). But despite that, just the legitimization of the debate is a big deal.

(29 March 2007)
FWIW, Stuart sums up my reaction as well. -BA

Report: Gov’t needs plan for oil peak
Alan Zibel, Associated Press
The U.S. government is in need of a strategy to minimize potentially dire economic consequences after worldwide oil production peaks and begins to decline, the investigative arm of Congress said Thursday.

Though experts disagree about when daily oil output will reach its maximum level — or whether they have done so already — the Government Accountability Office said in a report that most studies have found oil production will reach a peak sometime between now and 2040.

The report warns that, as the world’s largest oil consumer, the U.S. is vulnerable to significant economic troubles, brought about by rising prices, if a peak arrives and no technology exists to replace petroleum-based transportation fuels.
(29 March 2007)
The article will probably be published in dozens or hundreds of newspapers and news sites. It’s already appeared at:
Houston Chronicle
Business Week

The Peak Oil Crisis: The Studies

Tom Whipple, Falls Church News-Press
…The GAO effort will almost certainly be the straightforward professional exercise we have come to expect from this organization. The study will probably acknowledge that world oil production will peak someday and the researchers, who work for the Congress, will do their best to give a balanced answer to questions of when production will peak and what might we do about it.

[Writing about ANOTHER peak report which is due out soon, Whipple says:]

The second and what on the surface sounds the most in-depth study of world energy resources ever undertaken is being done under the auspices of the National Petroleum Council (NPC). This council, a federally chartered and privately funded advisory committee to the Secretary of Energy, was established by President Truman in 1946. Its purpose is to represent the views of the oil and natural gas industries with respect to any matter relating to oil and natural gas. Note the words “the views of the oil and natural gas industries” as they just may come back to haunt us after the two studies are released.

…The scope and work plan for the study are truly impressive. Task groups are to work on supply, demand, technology, and geopolitics. The task groups are to be overseen by a coordinating sub-committee that in turn reports to a Global Committee and finally to the NPC leadership itself. These task groups are supported by 25 “cross-cutting” subgroups, which are to examine smaller topics such as biomass, nuclear power, and “non-proprietary data.” At last word some 200 people were involved in the NPC effort. The study also is reaching out to nearly everyone who can spell “oil” — academia, laboratories, professional societies, consultants, governments, industry and you-name-it.

From reading the work plan for the study, one can’t help but be impressed by how thorough and comprehensive the study will be. Of particular interest is the opportunity to use and assess proprietary information about the world’s oil reserves and prospects for production held by participating oil companies.

…If one were cynical, you could believe that the NPC study, which by definition is to provide the oil and gas industry’s position, was commissioned to provide a counterweight to the independent GAO study should it conclude that peak oil is for real and imminent. The timing of the two studies’ release will of course give the NPC plenty of time to incorporate or attempt to refute whatever evidence or logic the GAO cites in reaching its conclusions.

No matter what the studies conclude, the possibility that our oil supplies will decline in the near future is one of the most, if not the most important issue facing the world.
(16 Nov 2006)
Tom Whipple was the first to alert most of us to these peak oil reports. He was prescient about the GAO report. Let’s hope that NPC report is at least as good as the GAO has been. -BA

Uncertainty Haunts GAO Peak Oil Report

EV World
…Today, the United States Government Accounting Office or GAO issued its 82- page report on peak oil, entitled Crude Oil — Uncertainty about Future Oil Supply Makes It Important to Develop a Strategy for Addressing a Peak and Decline in Oil Production [1.1MB]. It acknowledges three key facts: peak oil is real, no one is sure when it will occur and without consistent government policy that acknowledges its reality and plans for its eventuality, the United States, perhaps more than any other nation, will be the most seriously harmed economically.

The report, initiated at the request of Maryland Representative Roscoe Bartlett who has been the leading voice in Congress on the peak oil question, acknowledges that a decline in oil production, both conventional and unconventional, will occur within essentially one generation, likely sometime between now and 2040. The disparity in dates is attributed to the wide variance in the data and methodology used by various research entities from individuals like Dr. Colin Campbell and Professor Kenneth Deffeyes who see peak happening in the next few years to the USGS and Cambridge Research Associates who see a longer, but still historically brief window.
(29 March 2007)
First site to break the story and post a copy of the report.

GAO: Lack of clear policy on peak oil

The United States lacks a coordinated strategy to reduce uncertainty about peak oil or its consequences, a report by the Government Accountability Office says.

The report, released Thursday by the investigative arm of Congress, cites estimates as saying oil production will likely peak sometime between now and 2040, depending on a variety of factors including the demand for oil.
(29 March 2007)

Prepare for Peak Oil, GAO Warns

Ian Talley and John M. Biers, Wall Street Journal Energy Roundup
The Energy Department and other federal agencies need to develop a strategy to mitigate the effects of a peak in oil production, which most studies show will occur between now and 2040, the Government Accountability Office said today, in a study requested by members of the House Committee on Science and Technology.

Though there is a great deal of uncertainty about the timing of peak oil, in part because OPEC members don’t open up their crude reserves for independent audit, the U.S. would be one of the hardest hit by a such a peak due to the nation’s dependency on oil for transportation, according to the GAO.

Compared with past price spikes, “the consequences of a peak and permanent decline in oil production could be even more prolonged and severe than those of past oil supply shocks,” the GAO said. One reason is that the decline “would be neither temporary nor reversible,” said the report, which cited a “worldwide recession” as a possible outcome.

Though some leading analysts today view peak oil as a major worry, some leading energy companies such as Exxon Mobil and consultants such as Cambridge Energy Research Associates, see petroleum supplies as being more abundant.

Although the timing is uncertain, the GAO firmly endorses the concept that oil production will peak at some point.
(29 March 2007)

US Auditor: Energy Dept Should Develop Plan For Peak Oil Era

Ian Talley, Dow Jones
The U.S. Department of Energy and other federal agencies need to develop a strategy to mitigate the effects of a peak in oil production, which studies show could occur by 2040, a federal oversight body said Thursday.

While there was a great deal of uncertainty over the timing of peak oil because members of the Organization of Petroleum Exporting Countries don’t open up their crude reserves for audit, the U.S. would be one of the hardest hit by a such a peak due to the nation’s dependency on oil for transportation, according to a report issued by the Government Accountability Office.

The study was requested by members of the House Committee on Science and Technology.
(29 March 2007)

GAO Warns U.S. ‘Especially Vulnerable’ to Oil Price Spike If Production Drops

Jeff Tollefson, Congressional Quarterly
…Rep. Roscoe G. Bartlett, R-Md., who co-chairs the Congressional Peak Oil Caucus with Rep. Tom Udall, D-N.M., called the report a “clarion call” for action.

“Only the president can rally the country to take the urgent steps necessary” Bartlett said. “Potential alternatives to oil are extremely limited. Technology won’t save us without time and money to develop and scale them up.”

Some academics and geologists have been suggesting for years that the world is on the brink of a decline in production.

The theory has repeatedly been dismissed, however, by mainstream industry experts who suggest that peak oil theorists have failed to grasp the role that economics and technology will play as conventional reserves decline. Higher prices driven by scarcity of resource will naturally reduce demand, they say, while at the same time making unconventional sources and alternatives more economical.

A November report by Cambridge Energy Research Associates (CERA), an energy consulting firm, suggests that a peak in oil production won’t arrive until at least 2030, and even then the world won’t be hit by a precipitous drop in oil supplies. Rather, production will follow “an undulating plateau” for one or two more decades before starting a gradual decline.
(29 March 2007)