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Why ‘peak oil’ may soon pique your interest
David R. Francis, Christian Science Monitor
World oil production peaked in 2005, says one expert, and that presents serious problems in the future.
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Do a Google search of the Web on “global warming” and it calls up more than 80 million references. Search for “peak oil” and the number exceeds 10 million.
In two years or so, world concern over crude oils supplies should be so great that a Google search on that subject probably will top that of global warming, predicts Matthew Simmons, chairman of Houston-based Simmons & Company International, an investment banking firm for the energy industry.
… concern over the world’s oil supply is mounting. Last month, the International Energy Agency (IEA) issued a report warning that world oil demand will rise faster than previously expected. The result could be a supply crunch – “extremely tight,” one IEA economist told the BBC.
…In July, the National Petroleum Council, a federal advisory group representing the oil industry, published a 476-page study titled “Facing the Hard Truths About Energy.” Simmons, one of 350 participants who prepared the study, holds that its wording is not stern enough considering the statistics on the oil demand/supply situation it includes.
…Simmons uses such terms as “hogwash” and “junk report” in describing the study.
For years, many in the oil industry viewed the peak oil forecasts by Simmons as odd. Now his position has a lot of company. Several websites publish sophisticated material on the issue. There’s the Oil Drum (www.theoildrum.com), featuring “Prof. Goose” and “Gail the Actuary.” Those pseudonyms hide a full professor at Colorado State University and an actuary in an Atlanta suburb. There’s also the Energy Bulletin (www.energybulletin.net). The site’s coeditor, Bart Anderson, say it receives 11,000 visits a day. Peak oil enthusiasts, he says, have now divided into a majority seeing life after an oil crunch and those he calls “doomers.”
In Britain, Douglas Low, director of the Oil Depletion Analysis Centre (www.odac-info.org), foresees a “crisis coming up” with a real shortage of oil.
(6 August 2007)
Thanks to contributors Gail, Stuart and Bill for letting us know about the article.
Trust the Christian Science Monitor for giving even-handed treatment to peak oil, interviewing several of us and digging beneath the surface. -BA
Revolutionary report on future of oil
Michael Lardelli, Science Alert
In the debate over oil supplies, July 2007 may be seen as a turning point. The International Energy Agency, a body set up to advise OECD nations on energy supply and security, broke with its previous optimistic projections of world oil supply and threw the future of oil into doubt. The IEA’s recently released “Medium-Term Oil Market Report” (PDF 1.87MB) reads like a summary of peak oil concerns made acceptable for the ears of government by occasional disclaimers to the contrary. However, its central declaration is clear:
Despite four years of high oil prices, this report sees increasing market tightness beyond 2010, with OPEC spare capacity declining to minimal levels by 2012 … It is possible that the supply crunch could be deferred [by decreased demand growth] – but not by much.
…Concluding remarks
The IEA Medium Term Market Report is 82 pages long and contains much more of interest than I have summarised here.
The most pessimistic supporters of peak oil believe that decline of total world oil production is imminent. Indeed, I previously described how major figures in the industry such as energy investment banker Matt Simmons, oil entrepreneur T. Boone Pickens and retired National Iranian Oil Company Vice-President Ali Samsam Bakhtiari believe we are now at peak.
Nevertheless, the IEA Medium Term Report is refreshingly open and balanced in its approach to this most vital of topics. It is a further nail in the coffin for the irresponsibly optimistic future oil production scenarios painted by industry cheerleader Cambridge Energy Research Associates and the biggest of Big Oil – ExxonMobil. The publication of the IEA report means that the writing is now on the wall for all governments and industry to see.
Much higher oil prices can be expected within five years at best. Before this, a short, but deceptive, fall in oil prices may occur in 2008-9. It remains to be seen whether the political courage exists to openly discuss this issue and begin the painful process of weaning ourselves off oil. I am not optimistic.
Michael Lardelli is Senior Lecturer in Genetics at The University of Adelaide. Since 2004 he has been an activist for spreading awareness on the impact of energy decline resulting from oil depletion.
(8 August 2007)
Michael Lardelli has been a contributor to Energy Bulletin.
Peak Oil – less tourism?
Mary King, Trinidad Express
The Government of [Trinidad and Tobago] has chosen tourism as one of the economic pillars for the country’s diversification away from energy. So much so that we are creating in Trinidad waterfront hotels and a conference centre with the hope also of attracting the business tourist, and the more general kind to Tobago.
These plans are consistent with current annual growth forecasts for tourism which, according to the UN Tourism Organisation, are 3.8 per cent for regional and 5.4 per cent for long haul traffic – i.e. by 2020 some 1.6 billion people will be involved in international travel. These figures unfortunately do not take into consideration the phenomenon of Peak Oil which is manifesting itself in escalating fuel prices due in general to reducing production and increasing demand for oil.
…Surely then Peak Oil, as it is doing for food prices, will have an alarming impact on the tourism industry (particularly cruise ships that drag “hotels” along) that is at present the life blood of the region and one of the proposed pillars of our economic transformation.
…In T&T, we will be concerned with the kind of tourist to attract. One measure being used is eco-efficiency, the ratio of the money spent by an individual tourist to the amount of energy she utilised on-island. A study done for New Zealand showed that tourists from China and Australia were more eco-efficient than those from Germany, USA and Japan,
(6 August 2007)
The Round-Up: August 7th 2007
Stoneleigh, The Oil Drum: Canada
Will the Fed cut interest rates to alleviate the developing credit crunch, and will it have the desired effect if they do? Can lowering the cost of credit overcome risk aversion and the fear of cascading default? If not then the Fed will not be able to prevent the contraction of the money supply and the spread of contagion amid a sea of margin calls.
In Canada, oil sands fever continues unabated and a drilling frenzy may be shaping up in the Arctic. One political leader urges the defence of sovereignty in the Arctic, while another holds talks on North American Union well away from the public eye. In Ontario, businesses are paid not to consume power.
On the climate front, northern infrastructure faces a serious challenge as melting permafrost undermines it’s foundations, while Australia experiences a 1000 year drought.
Finally, we remember that 62 years ago, the world was waking up to the beginning of the nuclear weapons age.
(7 August 2007)
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