Look at this one, what do you think? Is this guy too extreme? Is there still hope? “Peak Oil: Life after the oil crash”

I think so, but only if we get some strong leaders at the top that will tell us the truth and start the transition now. I think our nation, the new President, since the old one is in the hip pocket of big oil and automobile, has to lead us through a “Manhatten like project” but focused on alternative energy. This also calls for curbing our demand for it. Do we have a leader with the moral strength to ask us to sacrifice? I don’t know.

Otherwise, I think his predictions will come true. Don
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Fabius Maximus replies: Does this person subscribe to the Psychic Hotline? Energy forecasts — esp. by Peak Oil folks — have been notoriously wrong for many decades. I find it amazing and bizarre that some people believe the future has suddenly become clear as glass. Let us parse the third paragraph on their home page.

“In practical and considerably oversimplified terms, this means that if 2005 was the year of global Peak Oil, worldwide oil production in the year 2030 will be the same as it was in 1980.”

It was an evil day for humanity when Johann Carl Friedrich Gauss “invented” the bell curve. It applies to many phenomena, but not to ALL phenomena. There is a strong basis to believe the global production curve will be asymmetric. Just to mention two factors… First, the graph should be of “liquid fuels” not oil. Substitutes for petroleum (e.g., biofuels, coal to liquids) were insignificant on the way up – but might be significant on the way down. Second, 2005 may have been but probably was not the peak year (they confuse political peaking with geological peaking).

“However, the world’s population in 2030 will be both much larger (approximately twice) and much more industrialized (oil-dependent) than it was in 1980. Consequently, worldwide demand for oil will outpace worldwide production of oil by a significant margin.”

How wonderful that the authors understand so much about the technology and economy of 2030. No doubt they are billionaires, have made prescient investments in 1986 – their technology and biotech bets must have paid off well.

“As a result, the price will skyrocket, oil dependant economies will crumble, and resource wars will explode.”

Sounds ominous. Before moving to New Zealand or Tasmania, can we first see their forecasts for 2008 written in 1986? Predictions of the USSR’s collapse, the two Gulf Wars, the Rise of China, and the economic growth of the past five years (perhaps the fastest global growth since the invention of agriculture).

The actual experts I know tend to be more modest in their predictions. In fact, I suspect an inverse correlation between expertise and bombastic rhetoric. For example, Robert Hirsch’s writings sound nothing like this stuff.

“Nothing is written.”

2) Perhaps I got carried away with my post about Deffeyes, who I nevertheless remember quite fondly; but my anecdote about his foibles does buttress Limbaugh’s quote, even though my general opinion of Limbaugh is unprintable.
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Fabius Maximus replies: I belive you are overstating the economic significance of Peak Oil. New supplies will almost certainly appear, as “predicted” by the standard supply/demand price curves — just not supplies of petroleum. After all, we need energy, not petroleum. It will take time however. Innovations do not come along like buses, on a convenient schedule.
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I agree with your comment about Deffeyes. The history of incorrect forecasts about peak oil is a black mark against its advocates, indicating profound and consistent methodological weaknesses. I have written about this several times.

Then, just plot the data in a scatter point or line chart and you will see how one of the largest oil producing regions ever exploited on earth and managed with better technology and more transparency than any other region in the world has played out over the decades. That is peak oil. Oil is still being pumped in vast quantities in the U.S., but the Peak could never be regained, even with Prudhoe Bay coming online (that countertrend hump in the late 1970’s you see).

Amazing how a basic fact of geology can be ignored by supposedly very intelligent people.

1) So far as the relationship between “supply and demand” and oil production is concerned, let us consider the analogous situation of the relationship between “supply and demand” and perpetual motion machines. There is, I think we all would agree, tremendous demand for such machines; and the profit making potential of such contraptions would be enormous. Nevertheless, for some reason, they persist in very short supply.

2) One of the chief Peak Oil gurus is Kenneth Deffeyes. Back in the ’70’s, I sat in his geology class where he then held forth that oil production would then decline. Sooner or later, he will be right.

3) Peak Oil advocates do not assert that there is no more oil. Rather they assert that, while there is still plenty of oil, it will grow increasingly more difficult to discover and extract. This is what they call Energy Return on Investment. There are going to be fewer and fewer Jed Clampetts.

4) It would require a geology degree to critique Peak Oil. Still, the Oil Drum contains much information of current geopolitical interest and -as such - is a valuable resource.
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Fabius Maximus replies: I do not see the relevance of points #1 and #2 to this post, although I agree with what you say. I do not see the relevance of #1 to peak oil.
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The Oil Drum has some good information, mixed in with large doses of nonsense. Sorting out which is which takes more time than perhaps the result is worth. The ASPO-US and ODAC newsletters are imo better sources.

Description

Resource and Energy Economics provides a forum for high level economic analysis of utilization and development of the earth’s natural resources. The subject matter encompasses questions of optimal production and consumption affecting energy, minerals, land, air and water, and includes analysis of firm and industry behavior, environmental issues and public policies. Implications for both developed and developing countries are of concern.

The journal publishes high quality papers for an international audience. Innovative energy, resource and environmental analyses, including theoretical models and empirical studies are appropriate for publication in Resource and Energy Economics.
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Fabius Maximus replies: Energy Policy is another journal with good articles about this important subject.