Peak Oil ! Peak Oil!

Another breathless piece telling us that we\’re all doomed, doomed I tell you!

Two things worth noting. All these calculations about peak oil seem to me (of course, I\’m willing to be corrected here) to miss something important about the geology of the whole process. We don\’t actually get all of the oil out of a reservoir. At present I think it\’s somewhere in the 25% to 30% level. That\’s up from 10% of so a few decades ago. So all the talk about us finding or not finding new reservoirs is a little off subject. There\’s a great deal more oil out there which we already know about than there is oil which we can currently extract. And we can increase the usable amount simply (perhaps not le mot juste) by continuing to improve oour extraction technology. As we have been and presumably will continue to do.

The second thing is well put by this commenter:


November 24, 2007 3:53 AM

Goody. $100 is just what we need to change consumption habits. I hope it goes higher.

As consumption habits change, and industry production costs rise, innovation will follow (more efficient transport, alternative energy) and government will limp along behind us, as is its curse in a consumer society.

Quite. Even if the peak oil crowd are correct, what is happening, the rise in prices, is exactly what we require to cure the probloem. Excellent the way that markets work, ain\’t it?

6 thoughts on “Peak Oil ! Peak Oil!”

  1. A rise in price that forces a change in consumption habits is not a good thing. It means a fall in utility. It might be a necessary thing, but that is different.

  2. Peak Oil is about peak PRODUCTION, not discovered reserves, new ways to bring extended life to old fields, ways to extract oil from tar sands, etc. etc. So far, it’s been easy to get the stuff out. Now it’s going to be hard, and we won’t be able to get it out as fast as we used to in the past.

    This means a mismatch between demand and supply, and rising prices. Which will change how people use (or not use) oil, foster innovation, etc. Which is just fine and dandy. But not fine for the ecomentalists who will lose their argument for controlling our lives.

  3. It’s worth noting that the pioneer of peak oil as a theory is Colin Campbell, who has been predicting peak oil “within five years or so” since about 1989. He’s been wrong on every major prediction he’s ever put into print

  4. “It’s worth noting that the pioneer of peak oil as a theory is Colin Campbell”

    There’s no “theory” to peak oil: it’s inevitable, just the same as “peak whale oil”, or “peak copper” or anything else we dig up to get.

    OK, so Colin doesn’t have a track record of when. So what? Using Hubbert’s method, it’s soon upon us, and we are going to have to get used to expensive oil. Personally, I almost welcome it: it’s about time we started to think a bit more carefully about whether it is truly necessary to drive 400 miles (or fly 5,000) for a business meeting.

  5. The good thing about peak oil (if memory serves correctly we should be at or just past it now) is that it should be boasting the prices of oil and so making the markets shift us across to non-carbon producing sources of energy, just as we need to in order to combat climate change.

    Isn’t it neat how one scary thing is helping to cancel out another (thanks to our market based economy)?

  6. Hi, agree with most of this, BUT:

    1) New fields take 6 years to come on-stream, therefore we already KNOW what will be extracted in the next 6 years, therefore we KNOW the world will be in deep shit by then. Very.

    2) There is sweet crude we like, and there is sour crude we hate. Guess which kind geologists are still finding in abundance outside the Middle East.

    3) High prices cause demand destruction as you say. We mean here the sudden collapse of transport systems and their national economy. See Reuters AlertNet for details of what that really means (mainly in Africa so far).

    4) When the price gets too high, that’s the time to steal the stuff, when we will call it an honourable war. I think there’s a reason why billions are pouring into the oil futures market – they’re hoping to be war profiteers. Hey, they already KNOW it’s coming.

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