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Reports of the Death of Peak Oil Have Been Greatly Exaggerated

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A week or so ago, there was a mini-flurry of blog posts announcing that peak oil was dead. Thanks to shale oil, tar sands, heavy oil, deepwater oil, and all the other kinds of oil that the peakists didn’t know about, the world was now practically drowning in the stuff.

The whole thing was very strange for several reasons. First, the peak oil community not only knows about all those kinds of nonconventional oil, its forecasts have always included them in minute detail. The question isn’t whether they exist, it’s when production declines in existing mature fields will outpace the modest amounts of new oil we’re getting from nonconventional sources and new drilling technologies. Second, the world isn’t drowning in oil. There’s no dispute that shale oil has ramped up over the past few years, but it’s added only a couple of million barrels a day to worldwide production and it’s likely to start declining pretty quickly (within five or ten years or so). It’s really not that big a deal on a global scale. Third, peak oil has never been only about the exact date that production of oil hits its highest point. It’s been about how long production will plateau; how steep the subsequent decline will be; how expensive it will be to extract nonconventional oil; and how much oil prices will spike up and down as demand bumps up permanently against supply limits.

Hell, a few years ago even the International Energy Agency‌—which historically had refused to acknowledge production limits even theoretically—finally admitted that peak oil was a reality. When you lose the IEA to the dark side, you really ought to just admit defeat.

That said, for the past few years I haven’t been following peak oil in minute detail. I’ve written occasional blog posts on related topics, but that’s about it. So I didn’t respond to the peak oil flurry because I no longer have detailed, up-to-date knowledge of where we are. However, Chris Nelder does, and he has a long blog post today that will bring you up to speed if you’re interested in the latest data. Pay particular attention to the distinction between “crude oil” and “petroleum liquids.” They’re both worth tracking, but they’re different things and they serve different needs. Liquids are useful for a variety of purposes, but if you want gasoline for your car, the only thing you care about is the supply of crude oil.

For what it’s worth (which isn’t much), I note that Nelder and I happen to agree on the overall shape of things: Crude oil production has been almost flat over the past decade, and the likely date of the overall global peak is sometime between now and 2020. After that, we’ll be in irrevocable decline.

Mother Jones

13 Comments on "Reports of the Death of Peak Oil Have Been Greatly Exaggerated"

  1. westexas on Thu, 25th Jul 2013 3:10 pm 

    If the Peak Oil “Theory” is dead, what’s the alternative theory, that the finite sum of discrete sources of oil that peak and decline, e.g., the North Slope of Alaska, will show a perpetual increase in production?

  2. Arthur on Thu, 25th Jul 2013 4:39 pm 

    TheOilDrum could not wait for 2030 to arrive and decided to demobilise the troops.

    Peak Oil (Peak Fossil rather) is not dead but said he went out to buy some cigarettes. He will be back in 10-20 years.

  3. Grover Lembeck on Thu, 25th Jul 2013 5:25 pm 

    A website shut down, and that has become proof that peak oil is a myth? Smells like desperate bs to me.

  4. DC on Thu, 25th Jul 2013 6:19 pm 

    ToD shut down because no one was really interested in reading about rig-counts in Saudi Arabias second string oil fields. I found the ‘new and improved’ ToD to be boring, narrowly focused, and that it had acquired and newly found pro-oil tone to most of its articles.

    That is why they are done with. Nothing to do with some arbitrary date being too far off in the future…

  5. truebeliever on Thu, 25th Jul 2013 7:37 pm 

    All one must do is chart out declines vs. finds over ten years to see the big picture. Example Bakken decline rate is 750K bopd/yr – 7,500,000 bopd/10yr new sources and that’s all gonna come from wells not yet drilled.

    Not going to happen.

  6. Arthur on Thu, 25th Jul 2013 7:44 pm 

    We’ll see. I think some day an insider will spill the beans about the real reasons for the TOD closure. It is very difficult to admit that the original expectation of an immanent peak-oil event was wrong. These people invested many years in broadcasting the message, which essentially was correct… as far as conventional oil was concerned… but that they were caught off-guard by the rise of the fracking business. It was very wise to focus on ‘boring’ rig counting… and to draw thorough conclusions and that is probably what they did and decided to call it a day and start raising a family, a french restaurant, whatever. The last thing you do is quitting in sight of the peak-oil harbor. At least you can reap the rewards and become a world famous oil consultant and frequent CNN, BBC, RT and PressTV.

  7. LT on Thu, 25th Jul 2013 8:31 pm 

    TOD, at best, is just an independent online newspaper. It could choose (or not choose) to report about peak oil news. It has nothing to do with the oils that are being pumped out of the ground.

    Unless human way of life reverts back to the old days (no more fossil fuel extraction) the oil in particular and fossil fuels in general, will eventually diminish. At the same time, the environment, that we live in, will get destroyed as well (actually it has been happening already).

    Any article that claims peak oil is dead is pure propaganda, and not worth to read. I did not read the entire above-article. I just glanced at the title and knew it is a bogus one.

    I suppose someone must get paid to sit down and write none-sense things and post it. Doesn’t it?

  8. peakyeast on Thu, 25th Jul 2013 9:16 pm 

    Its sad that TOD decided to get a “opinionated-tasters board” filter on articles and thereby killed itself indirectly IMHO.

    I commented on this about a year ago that they were chasing away valuable contributors and that they should let the readers decide what was interesting. Leanan answered that it was good that they chased away people like Gail the acturary since they could then spawn new sites…

    I did not have anything good to say about that answer so i kept my opinion to myself.

    Probably Leanan and the others controlling the site were in good meaning. But as i mentioned then: I have seen many small “grassroots” organisations die due to overly much so-called “democratic” and “necessary” control.

    And so it happened..

  9. J-Gav on Thu, 25th Jul 2013 9:30 pm 

    ” … global peak is sometime between now and 2020.” I’d say the author got that right – which leaves what? 7 years! To adapt to the “new” situation. Not a helluva lotta time, is it? Jimmy the Greek, a famous, now deceased Las Vegas bookie, would be goin’ nuts on this one.

  10. BillT on Fri, 26th Jul 2013 1:07 am 

    As e bounce across the plateau, we cannot see the cliff ahead through all of the lies and propaganda. It could be next year or 10 years, but it is there and it WILL be a cliff, not a slow decline.

    Why do I say that? Because the end of oil will probably come in the form of a world financial system collapse that shuts down most of the recovery/transport/sales.

  11. George Monbiot on Fri, 26th Jul 2013 9:18 am 

    And meanwhile the “Greens”, Greenpeace and the antiglobalization movement are focusing on the “ills” of nuclear power. Most of them using electricity intensively, whose source is often nuclear power, and driving fuel powered SUVs. What a srange world indeed!

  12. Arthur on Fri, 26th Jul 2013 10:00 am 

    “” … global peak is sometime between now and 2020.” I’d say the author got that right – which leaves what? 7 years! To adapt to the “new” situation. Not a helluva lotta time, is it?”

    That’s about oil only, gas and coal will peak later. And then there are wildcards like fracking, methane hydrates + all sorts of technologies enabling to wring the oil sponge from deserted fields even more.

    Oh and post peak, life does not stop but a decades long slide downwards the fossil hill will follow, enabling us to do something during those decades and work on endless possibilities, even richer from a technological point of view, than the IT craze of the past decades has shown.

  13. dave thompson on Sat, 27th Jul 2013 8:59 am 

    Light sweet conventional oil has peaked, the good stuff is in decline

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