[ROCKMAN]

ralfy - "...the effects of peak oil may take place even before oil production peaks." And how far back would you go to tie events to some future global peak oil DATE? Maybe all the way back to the price spike of the late 70's?

Long ago I coined the "POD"...the Peal Oil Dynamic. Mostly to get folks away being focused on the relatively meaningless date. Perhaps using "PO" as part of the acronym was the best choice because it still connects the idea to peak oil. In reality all the highs and lows we've experienced with respect to oil production would have occurred whether global oil production ever happens or not.

The recession inducing high oil prices, military activities in the ME that has cost the US $trillions and thousands of our personnel's lives, the volatile prices that boom and the crush the petroleum industry, etc: none were due to some future max future oil rate. If you look back such events often induced some folks to argue we had reached peak oil. And then be proven wrong.

Tempting to come up with a more appropriate acronym. But I think most understand the meaning of the POD: all that is happening in the world of oil production, consumption, pricing, distribution, technology, etc. which has NOTHING to do with the peaking of the global rate of oil production.

[vtsnowedin]

I would think that everything that has happened sense the first Gulf war is part of the Peak Oil Dynamic, 'POD' including all the activity on this and other web sites. The resource wars that are a reaction to oil field decline will produce winners and losers and can result in spikes in production for a while that mask the approaching limits to total annual production. We humans don't just sit and watch our world change complacently, we think about the problems we face and try to do something about it. Unfortunately when one of our resources becomes scarce we often choose the option of stealing somebody else s supply.

[ROCKMAN]

vt - All valid points. But what about the inflation adjusted price of $119/bbl back in the late 70's? Was that not impactful? Big impact on the petroleum idustry: we put 4,500+ drill rigs to work. Or the empty gas stations as a result of the so called "Arab embargo"? Or Iraq invading Kuwait in the early 90's leading the US into its first major "oil war"? Or the other side of the coin: the price crash of the 80's when the individual OPEC countries clashed with each other over production limits?

If fact, if you want to go to extremes what about the US oil embargo against Japan which aided their military to gain more influence with Japan's govt that could have contributed to WWII? You can even add the 1950's when the US, as THE global oil exporter, set the price thru via the Texas Rail Road Commission. The arrival of kerosene in the early 1900's had a huge impact on the whaling industry.

Oil production has been the catalyst for major economic and social changes in society for a very long time. And will continue to do so whether we reach global PO today, in 2 years or 20 years. As long as oil production continues to play an important role in our lives its dynamic nature will persist IMHO.

[ralfy]

ralfy - "...the effects of peak oil may take place even before oil production peaks." And how far back would you go to tie events to some future global peak oil DATE? Maybe all the way back to the price spike of the late 70's?

Long ago I coined the "POD"...the Peal Oil Dynamic. Mostly to get folks away being focused on the relatively meaningless date. Perhaps using "PO" as part of the acronym was the best choice because it still connects the idea to peak oil. In reality all the highs and lows we've experienced with respect to oil production would have occurred whether global oil production ever happens or not.

The recession inducing high oil prices, military activities in the ME that has cost the US $trillions and thousands of our personnel's lives, the volatile prices that boom and the crush the petroleum industry, etc: none were due to some future max future oil rate. If you look back such events often induced some folks to argue we had reached peak oil. And then be proven wrong.

Tempting to come up with a more appropriate acronym. But I think most understand the meaning of the POD: all that is happening in the world of oil production, consumption, pricing, distribution, technology, etc. which has NOTHING to do with the peaking of the global rate of oil production.

Actually, it does, as the peaking is brought about by diminishing returns.

[vtsnowedin]

vt - All valid points. But what about .....

......
Oil production has been the catalyst for major economic and social changes in society for a very long time. And will continue to do so whether we reach global PO today, in 2 years or 20 years. As long as oil production continues to play an important role in our lives its dynamic nature will persist IMHO.

All you historic examples were solved by successfully seeking new sources of supply. Peak oil is about when that no longer works. Dynamics can work for or against you and I think the past was mostly positive as evidenced by the world human population and standard of living. I don't see that continuing and as the dynamics turn negative I expect equally negative results.

[ROCKMAN]

ralfy - "Actually it does, as the peaking is brought about by diminishing returns.". OK, let's look at your proposition...and everyone is invited to play along. So you feel that the " Arab embargo" of the 70's and oil prices spiking to $119/bbl (adjusted) was due to global oil production (GPO) peaking 40 years in the future? And that assumes we have reached GPO. I suspect few would agree on that cause/effect relationship but they can speak for themselves

But let's explore that possibility. For brevity let's call all those events I described to vt as THE HISTORY. He just described THE HISTORY as mostly positive. I doubt many would describe the global recession preceded by the 70's price spike as positive. Nor the $trillions of our tax dollars and the thousands of our military's lives expended in the 2 Gulf wars as very positive. And these events were obviously part of the POD. But overall positive or negative is a subjective call so we can pass on that debate.

Rather let's play the "what if" with respect to the date of GPO. Once there we can address vt expectation of what follows GPO. And we'll keep it simple...just 3 what its.

A: what if we have actually reached GPO in the last couple of years. Some feel maybe...some not. But that's not a question to debate here...it's the assumption.

So we had THE HISTORY we've had. And ralfy seems to disagree with my assertion that THE HISTORY isn't related to GPO. So let's consider another couple of what if's.

B: what if GPO doesn't hit until 2037? How production holds on a plateau and peaks is not a subject for debate here...it's an assumption. So if true how would THE HISTORY have be any different?

C: what if GPO doesn't hit until 2067? So if true how would THE HISTORY have be any different?

To answer both B and C THE HISTORY would not have played out differently IMO. Perhaps ralfy disagrees. If so I'll let him (or anyone else) defend that opinion.

So if you agree that GPO happening in 2027 or 2067 would not have changed anything that's happened with respect to the POD over the last 40 years then here's the next questions: how would the GPO happening in 2027 effect the POD over the next 10 years? how would the GPO happening in 2067 effect the POD over the next 10 years?

Easy answers if you agree that the POD for the last 40 years was not effected by reaching GPO recently: reaching GPO in 2027 or 2067 WILL NOT determine the nature of the POD by those dates.

Which is a long way of repeating what the Rockman has preached for a long time: the date of GPO is relatively unimportant and thus a waste of space to debate here. At least with respect to the nature of the POD before we reach GPO. Afterwards? That's vt's point and we'll dig into later.

[asg70]

The POD thing is just a brain fart on "the" Rockman's part that he wants to seem more significant than it is.

That resources impact geopolitics and the economy is not insightful. That's been true since before the first oil well was even drilled. Giving it a name that links it to peak-oil does nothing but mis-attribute cause with effect, which is why I detest it.

Somewhere from around 2008 onward the focus of the peak oil movement was lost and instead we have these little pockets of thought which have attempted to sort of carry the flame, but when you peel it back, you realize that it really isn't peak oil in a strict sense of the term. POD is one. ETP is another.

[Revi]

How long do you think we are going to continue to get pushed around by this energy packed goo? I don't think it will continue forever. The stuff we're getting now uses up far more energy to get out than the stuff that came out under pressure. We are in the waning days of the stuff. Whenever the peak is doesn't matter as much as how much net energy it will give us. We haven't figured out how to use the stuff very efficiently, so it's no wonder it's running out.

[AdamB]

the peaking is brought about by diminishing returns.

Which one?

[AdamB]

How long do you think we are going to continue to get pushed around by this energy packed goo?

You? As long as you need gasoline or diesel to get your boat to the ocean. The wife has already left the energy packed goo in exchange for energy packed batteries. I'm seriously tempted to one up her, been eyeing up that Bolt pretty hard. Maybe even a pluggable hyrid, which appear to be on the way out, because what people were really wanting was that electric in the first place.

I don't think it will continue forever. The stuff we're getting now uses up far more energy to get out than the stuff that came out under pressure.

So? That doesn't seem to have bothered anyone except traditional peak oilers who needed a red herring from how poorly the bell shaped curve worked out. So they grabbed the boogey man warming up in the batters box, and just waited for the gullible to bite.

We are in the waning days of the stuff.

Yup..that's what we've told by far more involved people than you since 1886. At birth you were in the waning days Revi, do you feel any different being older now and still being in the waning days? How about kids or grandkids? You think they'll need to worry about the waning days after more than when your grandparents were young, and their peers were saying the same things? Do you think they fell for it like you apparently have?

Whenever the peak is doesn't matter as much as how much net energy it will give us. We haven't figured out how to use the stuff very efficiently, so it's no wonder it's running out.

Who cares about using it efficiently when you stop using it? You go right ahead and keep feeling jipped because you need the stuff, just don't pretend that the rest of the world isn't already working through the problem, and even suburbanites like my wife have left it behind. She recommends you join her, and stop worrying about it already.

[ralfy]

ralfy - "Actually it does, as the peaking is brought about by diminishing returns.". OK, let's look at your proposition...and everyone is invited to play along. So you feel that the " Arab embargo" of the 70's and oil prices spiking to $119/bbl (adjusted) was due to global oil production (GPO) peaking 40 years in the future? And that assumes we have reached GPO. I suspect few would agree on that cause/effect relationship but they can speak for themselves

But let's explore that possibility. For brevity let's call all those events I described to vt as THE HISTORY. He just described THE HISTORY as mostly positive. I doubt many would describe the global recession preceded by the 70's price spike as positive. Nor the $trillions of our tax dollars and the thousands of our military's lives expended in the 2 Gulf wars as very positive. And these events were obviously part of the POD. But overall positive or negative is a subjective call so we can pass on that debate.

Rather let's play the "what if" with respect to the date of GPO. Once there we can address vt expectation of what follows GPO. And we'll keep it simple...just 3 what its.

A: what if we have actually reached GPO in the last couple of years. Some feel maybe...some not. But that's not a question to debate here...it's the assumption.

So we had THE HISTORY we've had. And ralfy seems to disagree with my assertion that THE HISTORY isn't related to GPO. So let's consider another couple of what if's.

B: what if GPO doesn't hit until 2037? How production holds on a plateau and peaks is not a subject for debate here...it's an assumption. So if true how would THE HISTORY have be any different?

C: what if GPO doesn't hit until 2067? So if true how would THE HISTORY have be any different?

To answer both B and C THE HISTORY would not have played out differently IMO. Perhaps ralfy disagrees. If so I'll let him (or anyone else) defend that opinion.

So if you agree that GPO happening in 2027 or 2067 would not have changed anything that's happened with respect to the POD over the last 40 years then here's the next questions: how would the GPO happening in 2027 effect the POD over the next 10 years? how would the GPO happening in 2067 effect the POD over the next 10 years?

Easy answers if you agree that the POD for the last 40 years was not effected by reaching GPO recently: reaching GPO in 2027 or 2067 WILL NOT determine the nature of the POD by those dates.

Which is a long way of repeating what the Rockman has preached for a long time: the date of GPO is relatively unimportant and thus a waste of space to debate here. At least with respect to the nature of the POD before we reach GPO. Afterwards? That's vt's point and we'll dig into later.

People can game the system by curtailing supply, increasing or lowering prices, etc., but that will not reverse diminishing returns. And diminishing returns are the underlying principle of PO. That's why there's a PO in your POD.

Also, why only GPO? Why not GPO per capita?

[ROCKMAN]

ralfy - "And diminishing returns are the underlying principle of PO. That's why there's a PO in your POD." As explained many times before: a company's ROR is neither solely a function of the price of oil nor how much is discovered. There no reason the industry's overall ROR would be lower in the future if only 20% of the oil is discovered as was last year. It has always has been and always will be a function of how much is spent finding new reserves.

I feel like many you think 50 years ago it was easy to make big profits in the oil patch because you see the big fields discovered back. What you can't appreciate is how much money was lost drilling dry holes looking for those fields. Exploration tech was so poor in those days compared to now it wasn't much more then just random drilling.

You've never looked at a well map along the Texas and Louisiana coast (one of the most prolific hydrocarbon trends on the planet) and seen hundreds of thousands of dry hole symbols with occasional oil/NG fields scattered among them. The exploration success rate today is much higher the ever before in history. The fields left to discover are smaller. But I don't have to drill dozens of dry holes looking for each of them like I did 50+ years ago.

"Also, why only GPO? Why not GPO per capita?" Simple: because this site is called "peak oil" and not "peak oil per capita". LOL. Yes, per capita numbers can be interesting. But also very misrepresentative: per capita oil consumption in India is meaningless because such a huge portion of the public has virtually no impact of the country's oil consumption. And won't for many decades and maybe never.

[ROCKMAN]

I'm guessing the what-it game was too convoluted for most folks to appreciate. The reality:

First, whether GPO happened recently, or will in 2027 or 2067 it obvious can't change what has happened to the POD since the 70's. So the big question: what will the POD be like the next 10 years if GPO hits in 2027. Or in the next 40 years if it hits in 2067.

Easy answer: it will be very similar to the POD we've experienced the last 40+ years. Why not: we've seen extremes pushed to both ends of the spectrum for the last 4 decades. Should we suddenly expect stability in the oil market? Doesn't seem likely IMHO.

So now to the biggest question: what will the POD post GPO? Again an easy answer: similar to the POD we have experienced before reaching GPO. I see no reason for a meaningful difference. If anyone does please explain why...in detail.

[ralfy]

ralfy - "And diminishing returns are the underlying principle of PO. That's why there's a PO in your POD." As explained many times before: a company's ROR is neither solely a function of the price of oil nor how much is discovered. There no reason the industry's overall ROR would be lower in the future if only 20% of the oil is discovered as was last year. It has always has been and always will be a function of how much is spent finding new reserves.

I feel like many you think 50 years ago it was easy to make big profits in the oil patch because you see the big fields discovered back. What you can't appreciate is how much money was lost drilling dry holes looking for those fields. Exploration tech was so poor in those days compared to now it wasn't much more then just random drilling.

You've never looked at a well map along the Texas and Louisiana coast (one of the most prolific hydrocarbon trends on the planet) and seen hundreds of thousands of dry hole symbols with occasional oil/NG fields scattered among them. The exploration success rate today is much higher the ever before in history. The fields left to discover are smaller. But I don't have to drill dozens of dry holes looking for each of them like I did 50+ years ago.

"Also, why only GPO? Why not GPO per capita?" Simple: because this site is called "peak oil" and not "peak oil per capita". LOL. Yes, per capita numbers can be interesting. But also very misrepresentative: per capita oil consumption in India is meaningless because such a huge portion of the public has virtually no impact of the country's oil consumption. And won't for many decades and maybe never.

But we're not just talking about companies, their profits, and production only, right? There are also consumers (their numbers and what they can afford), debt levels, the amount of oil needed to maintain that global economy and economic growth, etc. Hence, the "D" in POD, which includes production per capita, not to mention other material resources that are affected in the same way as oil, as well as what you think won't be affecting the world "for many decades and maybe never" but has been the past two decades:

http://www.bbc.com/news/business-22956470

https://ourfiniteworld.com/2013/04/11/p ... e-problem/

[vtsnowedin]

So now to the biggest question: what will the POD post GPO? Again an easy answer: similar to the POD we have experienced before reaching GPO. I see no reason for a meaningful difference. If anyone does please explain why...in detail.

Not an easy answer at all. All of history has been pre GPO where every event has been followed by an increase in global oil production. After we pass GPO for real every event post GPO will be followed by a decline in global oil production which is a entirely different dynamic than anything we have seen before so looking at history is of no use.

[ROCKMAN]

vt - "...a decline in global oil production which is a entirely different dynamic than anything we have seen before so looking at history is of no use.". And that's exactly my point: why would we expect the POD to be much different post GPO then pre GPO? Shortage of oil production? What does " shortage even mean: not enough oil for everyone to buy what the WANT? In that case there's has always been a shortage of oil since the beginning of the petroleum age. So the big change post GPO would be high prices? We've going thru periods of high prices recently as well as more then 35 years ago...nothing new there. Economic recessions spurred by those high prices? Been there...done that. A collapse in demand (and prices) from economic down turns or alternative energy sources damaging the petroleum industry. Nothing new there: happened in the early 80's, late 90's and recently. Military conflicts over fossil fuel resources? Obviously nothing new there? High levels of drilling activity....low levels of drilling activity? Something new??? Massive borrowing by the petroleum industry to fund increased exploration or numerous bankruptcy fillings? Have read about both. Political mud slinging with one party blaming the other for climate change or blaming the other for the lack of energy independence due to excessive environmental regs? Yeah, where have we heard that before? LOL.

So, you see a different dynamic post GPO then any of the developments we've seen pre GPO. Please describe some IN DETAIL.

[ralfy]

vt - "...a decline in global oil production which is a entirely different dynamic than anything we have seen before so looking at history is of no use.". And that's exactly my point: why would we expect the POD to be much different post GPO then pre GPO? Shortage of oil production? What does " shortage even mean: not enough oil for everyone to buy what the WANT? In that case there's has always been a shortage of oil since the beginning of the petroleum age. So the big change post GPO would be high prices? We've going thru periods of high prices recently as well as more then 35 years ago...nothing new there. Economic recessions spurred by those high prices? Been there...done that. A collapse in demand (and prices) from economic down turns or alternative energy sources damaging the petroleum industry. Nothing new there: happened in the early 80's, late 90's and recently. Military conflicts over fossil fuel resources? Obviously nothing new there? High levels of drilling activity....low levels of drilling activity? Something new??? Massive borrowing by the petroleum industry to fund increased exploration or numerous bankruptcy fillings? Have read about both. Political mud slinging with one party blaming the other for climate change or blaming the other for the lack of energy independence due to excessive environmental regs? Yeah, where have we heard that before? LOL.

So, you see a different dynamic post GPO then any of the developments we've seen pre GPO. Please describe some IN DETAIL.

Unless a technology appears that will replace oil easily, then POD should not change as it refers to various factors interacting in industrialized societies that are dependent on oil.

What will change will be the various effects of "PO" in "POD" affecting "D". That might mean production cost (not just price) and whether that cost (in dollars and in terms of energy returns) can sustain basic needs per capita plus a growing global middle class (which is part of a global capitalist economy that requires continuous growth), among others.

[ROCKMAN]

ralfy - That's exactly my point: all that you mention have been a part of the "D" for at least the last 35+ years. In fact name one situation post PO that we haven't experienced in the last several decades: high/low oil prices, drilling booms/busts, consumer demand growing/declining, political stability/turmoil in oil exporting countries, etc. And I'm not talking subtle changes but large swings of the pendulum.

Why I keep and will keep pounding the same point: the date of GPO will be of little practical significance.

[ralfy]

ralfy - That's exactly my point: all that you mention have been a part of the "D" for at least the last 35+ years. In fact name one situation post PO that we haven't experienced in the last several decades: high/low oil prices, drilling booms/busts, consumer demand growing/declining, political stability/turmoil in oil exporting countries, etc. And I'm not talking subtle changes but large swings of the pendulum.

Why I keep and will keep pounding the same point: the date of GPO will be of little practical significance.

Oil consumption for EU, Japan, and the US started dropping in 2003 while that for the rest of the world started rising significantly. (See the link on peak demand.)

Per capita consumption for the former dropped but continues to rise steadily for the latter.

This may have to do partly with the rise of the global middle class, which in 2009, consisted of around 1.8 billion people, but by 2020 is expected to reach 3.2 billion, and almost 5 billion ten years later. (See the link on a global middle class.)

A much bigger concern involves basic needs for the global population, which in terms of per capita ecological footprint has been exceeding biocapacity. (See the link on ecological footprint.)

Thus, the world will need the equivalent of one more earth in order to ensure basic needs of just the current population. To maintain a growing global middle class that even oil companies need to pay for their debts plus profit, even more. How to do that given flat oil production per capita since 1979 will be a challenge, not to mention the point that the same population will keep rising to around 9-11 billion.

Finally, the first article shared earlier states that one reason why more are keen on using the yuan for oil trade is because China is now the top importer of oil.

Thus, all of these events took place only after 2001. There are more, like Saudi plans to sell shares of their oil company and an oil industry with around $2 trillion in debt. They remain and continue to affect the global economy even if GPO does not take place.

[Revi]

I keep hearing that 2020 is when the wheels really fall off. The US surplus is about gone, and we are going into 2018 with an oil price almost at $60. (Hard to tell if that's just due to Saudi instability or caused by scarcity) When will be world economy crack and oil prices fall again? Hard to tell. It's like we are falling down a set of steps. So far the steps have been small, but soon they get steeper and steeper...