Peak oil, prices, and supplies - Sept 9
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Matthew Simmons, Foreign Policy
Last week, four of the world's most outspoken oil aficionados waded into the controversy of peak oil, publishing articles packed with myth and distortion. This "Gang of Four" all claimed the issue was silly, moot, or simply a myth. The four pieces were Pulitzer Prize-winning author Daniel Yergin's seven-page article in Foreign Policy, energy analyst Michael Lynch's three column op-ed in the New York Times, analyst Edward Morse's essay in Foreign Affairs, and scholar Amy Jaffe's paper published by the Baker Institute at Rice University.
Here is a quick synopsis of the views expressed by all four writers:
1. Oil will remain an extremely important part of the world's economy throughout the next century as its main base of users shifts from prosperous countries to the teeming mass of humanity in Asia that previously used only tiny amounts.
2. Oil markets are now far more transparent and far more liquid given the fact that existing oil contracts allow investors to trade three to five times more oil than the world uses every day. This transparency will flood capital into oil markets, keeping the price low which, in turn, will encourage even greater demand.
3. The world's endowment of oil has never been so large, despite 150 years of constant oil use coupled with the fact that the world now consumes more than 85 million barrels of oil daily. This "fact" is why all four authors took aim at the Peak Oil worry-warts who they feel are intent on trying to convince the world that it is running out of oil.
4. The emergence of spectacular new technology will enable the supply of oil to flow far easier than ever. And, this new technology boom is just getting started. Over time, it will improve by leaps and bounds...
(4 Sept 2009)
Oil still has us over a barrel
Jeremy Leggett, The Guardian
The spate of recent giant oilfield discoveries in the Gulf of Mexico, Iran, Uganda and Brazil is welcome. A cohesive society will depend on plentiful supplies of oil for years to come, no matter how quickly we can mobilise low-carbon electricity stored in batteries and other climate-friendly fuels of the future. But concerns that we face a premature descent of global oil production over the next decade are unchanged.
The full list of reasons to worry was summarised by the UK Industry Taskforce on Peak Oil and Energy Security (ITPOES) in its report last year. Three key concerns on that list are the rapid rate at which existing oilfields are depleting, the length of time it takes to bring the increasingly rare finds of new giant oilfields on stream, and the inadequate levels of investment made by the oil industry – as a whole – in recent years.
In the 2008 International Energy Agency (IEA) World Energy Outlook, the IEA conducted an oilfield-by-oilfield study of the world's existing oil reserves for the first time. (One might reasonably ask why they had not done so before.) The average depletion rate of 580 of the world's largest fields, all past their peak of production, is 6.7% a year. Without investment in enhanced oil recovery (the various techniques petroleum engineers have of boosting recovery factors in their oilfields), the figure is 9%. In a key chart in the IEA's report, crude production begins a steep descent in 2009, falling steadily all the way from about 70 million barrels a day to below 30 by 2030. The depletion factor might better be called a fast-emptying factor.
(3 Sept 2009)
Maribynong Peak Oil Contingency Plan
Institute for Sensible Transport
The Institute for Sensible Transport was commissioned by Maribyrnong City Council to develop Australia’s first contingency plan for future oil supply disruptions.
Our team worked closely with council staff to assess council’s operations and vulnerability to oil supply constraints. This process led to the identification of ten service areas considered most vulnerable to either a short or long term reduction in available fuel supplies.
- Analysis of local demographics and transport patterns
- Analysis of council’s operations, services and oil consumption
- Identification of ten critical service areas most vulnerable to oil supply disruptions
- Facilitated workshop with over 35 council staff
- Risk analysis of service areas against a short and long term reduction in oil supply
- Critical analysis and prioritization of response measures to oil depletion
- Recommendations to increase council and community resilience to future oil supply disruptions
To download a copy of the Maribyrnong City Council Peak Oil Contingency Plan, click here (2.84MB PDF)
(3 Sept 2009)
Sent in by EB reader Stuart McCarthy