Click on the headline (link) for the full text.

Many more articles are available through the Energy Bulletin homepage

Chris Skrebowski on BBC News: ‘We’re in the foothills of peak oil’
News, Radio 4 BBC

Broadcast on Radio 4 Thu 22 May – 17:00

5:00 PM Brown blaming OPEC – justified? (Interview with Tony Scanlon)
9:30 Peak oil, interview with Chris Skrebowski
13:50 Airline industry problems

Interview with Chris Skrebowski, editor of UK Petroleum Review

… Q: What do you say to the idea that some people have floated that part of the reason for the surging price in oil the fear … that peak oil has been reached?

Skrebowski: I think that’s an element in it. My own view is that this is not what we might call “pure peak oil.” The peak we’ve reached at the moment is that we’ve in effect run out of [increased production of] the light, cheap and low-sulphur oil … because the light oils make the maximum yield of the light products we want, they are the most desirable for refiners. … The products we want – the diesel and the jack [?] kerosene – are under great pressure and those are most easily made from the light crudes.

… This, if you like, is what I would describe as the “foothills of peak oil.” This is the first peak that we’ve achieved. … in light, low-sulphur crude.

The next peak will be when the producer countries’ exports start falling. Because their growth rates are differentially much higher than those in the West.

So in effect they are pre-empting more and more of their own oil for their own use, so then we will get another upward kick to the price when that starts to come in.

Finally then we will get the peak oil where we simply cannot produce any more of any grade, any quality, anywhere. And that will give the final kick-up.

Q: When do you think kicks 2 and 3 will kick in?

Probably around 2011. It could get pushed out to 2013 if everything goes perfectly. … in practical planning terms almost tomorrow.

Q: Do you think we have any idea? I mean the outcry over the price of oil right now is such that people are hurting, they’re feeling it. Do you think we’ve got any idea about what might be around the corner?

The short answer, I think: no. I really think we’re into a land without maps here. We don’t have any real historical precedent for this. We don’t quite understand how to deal with it or how to cope with it.
(22 May 2008)

Jeroen van der Veer, chief executive of Shell, answers back

UK Times
Top industrialist Jeroen van der Veer, chief executive of Shell, agreed to answer Times Online readers’ questions on the outlook for the oil industry and his own corporation, one of Britain’s largest oil companies.

[Below are Mr. van der Veer’s responses to two questions about peak oil. The interview at the Times website is much longer.]

… The peak-oil theory, as first published by King Hubbert, who was an American former Shell employee, is correct for easy-to-access oil, at least. In his time, this theory was true for easy to access oil in the USA, but he could most certainly not have envisaged the future development of the Gulf of Mexico or today’s development of oil sands.

It is true that “easy oil and gas” – or conventional oil and gas that are relatively easy to extract – will not be able to match the pace with which demand is growing. The main reasons are the maturing of existing fields in many parts of the world, the scale of the investments required to enhance oil recovery from these fields and to bring new projects on stream, and of course the limited access for the international energy industry in some countries.

I have been warning for sometime about the end of the “easy oil” era, and I think the message is slowly beginning to sink in. And so is the logical consequence: we need all the energy we can get.

What is less obvious to many people is that even if we develop and deploy all the energy we can together – including unconventional oil and natural gas, including alternative energy, including nuclear and including more coal – we will still struggle to match demand. Unless we can curb the consumption of energy through radically more efficient technology.

That brings me to climate change. More energy means more CO2 emissions at a time when climate change already looms as a critical issue. At Shell, I am determined to adopt first-quartile environmental standards and to develop a leading ability in managing CO2. So for example we are focusing our energies on CO2 reduction by increasing the efficiency of our operations, establishing a substantial capability in carbon dioxide capture and storage (CCS), and aggressively developing low-CO2 sources of energy.

We are investing in biofuels from non-food crops that offer significant CO2 benefits and we’re investing in hydrogen and next generation solar power. We are also helping to manage energy demand by offering products and services – like fuel economy formulations for petrol and high-efficiency lubricants – that help millions of customers use less energy and emit less CO2.

… As you can imagine, we spend a lot of time thinking about the future of energy and what the outlook for the industry might be. And we work closely with a range of governments and national oil companies to help them think about energy options.

We believe that energy choices that will be made during the next crucial half-decade will begin to produce different effects a decade from now — and that these choices will shape the world for a half-century to come. At Shell, we think the world could take one of two routes, which we’ve called Scramble and Blueprints, for the development of the energy system over the next fifty years.

In both scenarios we envisage very strong growth in renewables. But that growth can’t possibly meet all of the increased demand we will see over the next 50 years, for reasons of constraints in scaling up.

Let me give you some examples of the difficulty of scaling up renewables. For instance, if we were to replace all of today’s coal-generated electricity with wind farms – at typical wind farm load factors – that would require a land area equivalent to 3 times the entire area of France. And if every house in Britain had a 4-m² solar PV panel set up on the roof, it would only generate the same amount of electricity in a year as half of a modern, 1-gigawatt nuclear power station. For context, in 2005/06, Britain’s maximum demand was 63 gigawatts.

So in order to meet this increase in demand, we believe that it’s not a question of hydrocarbons or renewables but that actually the world needs more hydrocarbons and more renewables. By 2050 in the Scramble scenario we envisage renewables making up 37 per cent of total primary energy, and in the Blueprints scenario, 31 per cent.
(22 May 2008)

Peak Oil in Paris: International Energy Agency Now Skittish Too

Keith Johnson, Environmental Capital (WSJ blog)
Peak oil is contagious: even the International Energy Agency is getting the rash.

The WSJ reports today that the Paris-based IEA will slash its forecasts of global oil supplies, after years of rosy predictions that oil output would rise in lockstep with developed countries’ appetites. The IEA’s latest project? A close look at 400 of the world’s biggest oil fields to figure out how much oil is really left, and how much production is declining. Nobuo Tanaka, head of the IEA, said Thursday the plan is to provide a “more realistic supply potential” estimate of what’s really out there.

That marks a fundamental shift for the IEA, founded in the wake of the 1973 oil embargo and subsequent supply shocks. Ever since, the IEA spilled a lot more ink studying oil demand in rich countries than oil output in the developing world.

Two developments appear to underly the shift…

… With oil at $135 and climbing relentlessly, maybe some gentle prodding from the in-hock consumers club is all OPEC and other big producers need to open their books and tell all.
(22 May 2008)

Wall Street Succumbs to Peak Oil

James Pethokoukis, Capital Commerce (blog at US News & World Report)
It’s interesting that two of the biggest factors driving markets and economic policy right now are scientific theories, those of climate change and peak oil. For the past two years, every time I’ve chatted with an energy or commodities analyst, I have asked whether he or she believed in peak oil, the theory that global oil production has reached its zenith. The answers have slowly transformed from an outright “No” to “Well…” to “Certainly, investors seem to buy the theory more and more.”

Yeah, $135-a-barrel oil will do that to you. I was on CNBC’s Kudlow & Co. last night with oil guru Daniel Yergin, who has consistently dismissed peak oil while at the same time consistently missing the continual rise in oil prices. I didn’t get a chance to ask him whether he was changing his position. (He seems to have undue faith in the Saudis’ oil reserve claims.)

What do you think is causing the spike in oil prices? Please vote below:
(22 May 2008)

IEA Plans to Lower Oil Supply Forecast in Next Annual Report

Tara Patel and Grant Smith, Bloomberg
The International Energy Agency, the energy adviser to 27 nations, plans to reduce its long-term projection for crude oil supply after studying depletion rates at the world’s 400 largest fields.

The IEA will present a “more realistic supply potential” estimate following criticism previous forecasts have been “optimistic,” IEA head Nobuo Tanaka said in a television interview today. He didn’t give specific figures.

Speculation the future supply can’t meet demand helped push oil prices to a record $135.09 a barrel in New York today.
(22 May 2008)

The Wall Street Peak Oil Journal

Andrew Leonard, Salon
Page A1: The Wall Street Journal, Thursday, May 22, 2008:

A growing number of people in the industry are endorsing a version of the “peak-oil” theory: that oil production will plateau in coming years, as suppliers fail to replace depleted fields with enough fresh ones to boost overall output. All of that has prompted numerous upward revisions to long-term oil-price forecasts on Wall Street.

How the World Works has been closely following the Journal’s coverage of oil-related issues for several years — today’s front page story is the most pessimistic piece I’ve seen the newspaper publish. Two years ago (when a barrel of oil cost a mere $75), the phrase “peak oil” was more likely to be accompanied by the modifier “so-called” or to be ridiculed in a headline like, “Poking at Peak Oilers.”

But new record-setting prices nearly every day have a way of focusing the mind (in trading Thursday, crude oil futures broke $135). The International Energy Agency is getting gloomier by the minute, reports the Journal.
(22 May 2008)

Why Dems and Republicans Are Afraid of Two Words: Peak Oil

Kelpie Wilson, TruthOut
The pro-growth faction has reacted quickly and scathingly to the idea that there could be limits to growth.

… Today, despite skyrocketing oil prices, most politicians still avoid the term “peak oil.” Most of the media still treat peak oil advocates with skepticism, using epithets like “fringe” and “so-called”to describe peak oil theory. To be clear, peak oil is often misunderstood. The date that the world reaches peak oil is not the date we actually run out, but the date that we stop increasing production. This is followed by a “plateau” where oil production is flat.

Eventually, oil production will decline. Even a plateau is a big problem for a world economy that is based on growth. In a world where 850 million are still going hungry and 3 billion out of 6.5 billion live on less than $2 a day, stagnant oil production means an end to development models based on economic growth. The statistics show that oil production has been flat for more than two years now. These facts are simple. As Hubbert said back in 1956: “Nothing sensational about it, just straightforward analysis.”

And yet the most powerful institutions in our society continue to do everything they can to avoid confronting the truth. Fortunately, a vast network of independent citizens, academics and renegade oil company employees has kept probing at the truth and attempting to educate the public about peak oil. You can find their work online at sites like and

These networks have not only exposed the real statistics about oil production constraints, but they have begun to grapple with how the world should respond to this unprecedented crisis. Anyone who is interested in a firsthand encounter with the intrepid “peakists” might check out an upcoming conference. The International Conference on Peak Oil and Climate Change: Paths to Sustainability takes place from May 30 to June 1 in Grand Rapids, Michigan.
(22 May 2008)