A recent vacation afforded me the opportunity to read The Oracle of Oil, Mason Inman’s excellent new biography of Marion King Hubbert. I strongly recommend it. But, rather than writing a standard book review (which might cover much of the same ground as this one by Frank Kaminski), I’m inspired instead simply to offer a few words in appreciation of Hubbert himself.
Born in Texas in 1903, Hubbert earned his Ph.D. in geology at University of Chicago, then taught at Columbia University. He later worked at Shell’s research laboratory and for the U.S. Geological Survey, and occasionally lectured at Stanford and UC Berkeley. His contributions to geophysics included a mathematical demonstration that rock in the Earth’s crust, because it is under great pressure over large areas, behaves in some ways more like a liquid than a solid. He earned every relevant scientific award short of a Nobel prize, and won lasting fame as the father of “peak oil”—the theory (by now more of an observation) that oil production in any large area will inevitably start from zero, reach one or more high points, and decline back toward zero. (Here is a brief video clip of Hubbert in 1976 explaining the very basics of peak oil).
For years I’ve had a photographic portrait of Hubbert, given to me by his nephew, hanging just above my computer in my home office. I described Hubbert’s best-known accomplishments—his mathematical modeling of oil depletion and his successful forecast of a decline in U.S. petroleum production beginning around 1970—in my 2003 book The Party’s Over, and I have spent most of the last couple of decades reading, writing, and speaking publicly about oil depletion and its consequences, so I could fairly be described as a longstanding Hubbert devotee. After devouring Inman’s meticulously researched and entertainingly written biography, I feel even more indebted to the great man than before.
King Hubbert, who died in 1989, was right on so many issues. He was a strong advocate of population stabilization (like my spouse Janet and me, King and his wife Miriam decided against reproducing). He was also a fierce critic of mainstream economists’ mania for growth, writing in the 1930s that the compounded growth of the economy, and therefore of consumption, in the context of a finite planet would inevitably lead to ruin. He went so far as to compare modern economists to medieval court astrologers.
Following early support for nuclear energy and official involvement with the Atomic Energy Commission as a member of a technical advisory committee, Hubbert gradually came to see nukes as simply too risky and costly. By the 1970s, he was a passionate solar energy advocate.
In the 1980s, Hubbert became aware of anthropogenic climate change and saw it as another unavoidable reason for society to wean itself from fossil fuels.
Inman’s biography is immensely helpful in portraying Hubbert’s evolving views in the context of global events and topical controversies. At first, his bosses at Shell and USGS attempted to muzzle his work on oil depletion. Then, during the energy crises of the 1970s, falling domestic oil production and increasing reliance on imports became subjects of widespread discussion at the highest levels of government. President Jimmy Carter tried to persuade the nation to adopt energy efficiency and conservation as primary goals. But, in the ’80s, Ronald Reagan proclaimed that “there are no limits,” oil prices fell, and blind cornucopianism once again ruled national policy.
All of this is hauntingly relevant to our current situation. During the decade from roughly 2004 to 2014, conventional oil production languished, oil prices skyrocketed, and peak oil was once again a widespread topic of public discussion. Yet since mid-2014 petroleum prices have plummeted and oil depletion has again mostly disappeared from policy discourse. Pundits proclaim that “Peak oil is dead!” and insist that “No, we’re not running out of oil!”—even though peak-oil warnings never had to do with “running out,” but rather the inevitability of depletion and decline. A short-term focus on prices has thus repeatedly undercut our ability to plan for the long haul.
Today’s oil glut resulted from years of record-high oil prices and record-low interest rates, which sent torrents of investment capital flooding toward drilling projects in dismal-quality reservoirs—tight oil projects operated by many small-to-medium sized companies whose incentives were to lease land and drill as quickly as possible using other people’s money. This rapid-fire drilling flooded a depressed market, causing fuel prices to collapse and producers’ balance sheets to bleed red ink.
Meanwhile, the longer-term trend is toward higher costs to the oil industry as conventional crude production levels continue to wane and regular oil is replaced with expensive deepwater oil, arctic oil, tar sands, and tight oil. There are few if any of these new unconventional oil projects that make financial sense in today’s low-price environment, so the industry is currently investing vanishingly little in exploration. The eventual and inevitable result will be falling overall production rates and ever-more violent price swings. Without a long-term plan for weaning global transportation from its primary energy source, we face an economic whipsaw cutting first at society as a whole (when prices are high), then at the oil industry (when prices are low), with each turn of the blade made more savage by declining resource quality and by massive and growing levels of debt not only within the oil industry but throughout society as a whole.
M. King Hubbert tried decades ago to warn us about all of this, and he deserves to be remembered and celebrated. But it’s more than a little sad to see how his visionary contributions have been mischaracterized and largely ignored.