The world was running out of oil and the global economy was about to collapse as a consequence ten years ago. Imminent peak oil doom was everywhere and one of its leading proponents was banker Matthew Simmons. Among other things, Simmons based his prognostications on the claim that oil production in Saudi Arabia was about to peak and fall steeply, presaging an era of permanent global oil shortages. Simmons further suggested that global oil production had peaked in 2005 and would fall at a rate of 5 percent year thereafter.
To be fair, Simmons like most peak oilists fuzzied up his numbers and timelines enabling him to be vague about just what level Saudi production would achieve before beginning its inevitable decline. For example, one of the analysts over at peakist The Oil Drum site declared in 2009 that Saudi production had peaked at 9.6 million barrels per day in 2005 and projected that it would fall to around 7 million barrels per day by now. Simmons was a bit more canny and suggested that if Saudis worked really hard to boost production, they might briefly get to 12.5 million barrels per day. Even so, Simmons’ main assertion in his book Twilight in the Desert was: “My research has convinced me it is unlikely that Saudi Arabia could sustain any higher oil output than it now produces, and that even the current production rate may be too high.”
Simmons was sufficiently confident of his predictions that he took New York Times columnist John Tierney up on a bet in 2005 for $5,000 that the global price of oil would exceed an average of $200 per barrel in 2010. He lost.
So what did happen to Saudi Arabian production? According to Bloomberg News, Saudi production reached 10.7 million barrels per day in November and, as part of an agreed Organization of Petroleum Exporting Countries’ (OPEC) cut in production, dropped back to 10.5 millon barrels last month. World oil production in 2005 – when it supposedly peaked – averaged 85 million barrels per day. The global average stood at over 97.2 million barrels per day in 2016. Of course, the peak oilers also failed to see the shale oil and gas revolution made possible by fracking and horizontal drilling that boosted U.S. oil production from 5.2 million barrels per day in 2005 to nearly 9 million barrels per day today.
If the OPEC production cuts don’t hold, some analysts see oil prices falling back toward $30 per barrel later this year.
twocats on Wed, 22nd Feb 2017 8:47 am
so as long as we have a huge global financial meltdown every so often our oil supplies will last much longer than expected by most PO analysts. Got it.
rockman on Wed, 22nd Feb 2017 8:52 am
“…the peak oilers also failed to see the shale oil and gas revolution made possible by fracking and horizontal drilling that boosted U.S. oil production”. No, they didn’t. The potential of the shales was known by many…mostly in the oil patch. What they failed to anticipate was record high oil prices that would justify developing previously uneconomic resources.
Just as the cornucopians ignored the potential of falling oil prices to knock the US rig rate from 1,800 to under 400. Both sides of the debate simply suffer from a simple minded view of the complex peak oil dynamic.
Davy on Wed, 22nd Feb 2017 9:03 am
Two Cats, it is my opinion that peak oil dynamics will bring us down but not how we think. It will be demand destruction causing dropping economic activity together with increasing population that kills us. Add to this the economically destructive nature of depletion and planetary decline and this will ensure demand destruction can never be reversed. We will tumble down the economic rat hole of a collapse process. The only real question is how long and how bad. The other question is where. Location is critical because all of us inhabit a “local” not a “global”.
Cloggie on Wed, 22nd Feb 2017 9:11 am
@rockman – “peak oilists” and “people working in the oil patch” are two very different categories of people. I belonged to the first group (from 2006 after reading Heinberg until autumn 2012) and didn’t have a clue about fracking et al until it happened.
People love sensationalist horror stories like about “the end of the industrial age” or “we are all going to die from climate change”.
Midnight Oil on Wed, 22nd Feb 2017 10:20 am
Good for US…Glad to hear SA Kingdom is sxcking the black goo AFAP…Hopefully I’ll get 10 years of retirement….
Now to expand that fracking and offshore drilling to all pristine spots on the Planet
Hey, future generations have done NOTHING for ME…sorry guys. Just joking…really
joe on Wed, 22nd Feb 2017 10:31 am
https://www.researchgate.net/profile/Simon_Snowden/publication/46496122/figure/fig1/AS:306016735514625@1449971483755/Figure-1-World-oil-production-by-source-in-the-Reference-Scenario-Digitized-and-adapted.png
Seems obvious to me that the world supply of easy oil has peaked, and that ‘peak oil’ has been and gone. Theres lots of oily stuff out there to burn and make into plastic, but it’s economic cost is only shown in historically low interest rates and 20 trillions of national debt. Just having oil does not mean a good economy.
Jerry McManus on Wed, 22nd Feb 2017 12:30 pm
Ah, now it becomes clear.
Folks who bought the BS being peddled by the eggheads at the Oil Drum are feeling let down.
Now they lurk in Peak Oil forums and vent their frustration.
I’m certainly not above dumping on the eggheads at the Oil Drum, they do so richly deserve it, and as I’ve pointed out before Hubbert himself probably would have felt the same way.
At least I had the testicular fortitude to dump on the eggheads at the Oil Drum while I was still actually posting comments at the Oil Drum.
As I recall I got myself banned for it, just before they got blindsided by fracking and threw in the towel.
And so it goes.
Apneaman on Wed, 22nd Feb 2017 12:52 pm
clog, even the seafood is in on the hoax.
Climate change in the North Sea: oysters in, cod out
“The temperature of the North Sea is increasing with climate change. Good news for immigrant species – bad news for cold-loving residents. What else does global warming have in store for marine life of the North Sea?”
“The North Sea is warming. And this is drawing in a lot of new species, which previously kept to warmer regions.
One of these species is the Pacific oyster. The North Sea used to be too cold for it. “Today, it practically dominates the whole Wadden Sea,” says marine ecologist Christian Buschbaum.”
http://www.dw.com/en/climate-change-in-the-north-sea-oysters-in-cod-out/a-37646483
Apneaman on Wed, 22nd Feb 2017 1:02 pm
Worst flooding in 100 years hits San Jose, forcing 14,000 to evacuate
“About 14,000 residents in large swath of central San Jose were under mandatory evacuations orders. Evacuation advisories were also issued to 22,000 residents as flooding closed the 101 Freeway — a key route through Silicon Valley — as well as other major roads
The creek crested to a height of 13.6 feet at a river gauge point on Tuesday evening in South San Jose — nearly four feet above flood stage. The record before then was in 1922, when the creek crested at 12.8 feet, and before that, in 1917, when the creek reached 12.2 feet.
“This is a once-in-a-100-year flood event,” National Weather Service meteorologist Roger Gass said, referring to Coyote Creek’s surging height in South San Jose. “This is a record level.”
http://www.latimes.com/local/lanow/la-me-ln-san-jose-floods-20170222-story.html
Apneaman on Wed, 22nd Feb 2017 1:37 pm
Ronald Bailey is a science correspondent at Reason magazine? No. Reason magazine is not a magazine, but a front for another fossil fuel funded think tank and Ronald is not a “science correspondent”, but rather a cock sucking ass licking shill.
“Reason Magazine
(Redirected from Reason magazine)
This article is part of the Tobacco portal on Sourcewatch funded from 2006 – 2009 by the American Legacy Foundation.
Reason Magazine is a libertarian monthly print magazine produced by the Reason Foundation.
The magazine claims to provide “a refreshing alternative to right-wing and left-wing opinion magazines by making a principled case for liberty and individual choice in all areas of human activity.” [1]
Koch Wiki
The Koch brothers — David and Charles — are the right-wing billionaire co-owners of Koch Industries. As two of the richest people in the world, they are key funders of the right-wing infrastructure, including the American Legislative Exchange Council (ALEC) and the State Policy Network (SPN). In SourceWatch, key articles on the Kochs include: Koch Brothers, Koch Industries, Americans for Prosperity, American Encore, and Freedom Partners.”
more
http://www.sourcewatch.org/index.php/Reason_Magazine
http://www.sourcewatch.org/index.php/Reason_Foundation
Fake article from a fake publication. The content is irrelevant, from anyone who is a special interest think tank masquerading as a magazine or anything other than what they really are. Deceivers. This is why I scroll down and check the source. Didn’t even read it and don’t care what it says because their organization is a sham.
Apneaman on Wed, 22nd Feb 2017 1:46 pm
I wonder what Ronald would say to this?
Worst-ever coral bleaching event continues into fourth year
“It’s a catastrophe for coral reefs. Sea surface temperatures are so high across much of the tropics that many reefs will suffer severe bleaching for an unprecedented fourth year in a row. Divers in Australia are already reporting new bleaching in the northern part of the Great Barrier Reef, where last year half of corals in the worst-hit areas died.”
https://www.newscientist.com/article/2122016-worst-ever-coral-bleaching-event-continues-into-fourth-year/
After an unknown amount of other species humans rely on to survive are driven to extinction by the humans then the humans will go too. Eco systems are very resilient – they’ll fight to survive like everything else, but like all systems they have tipping points. Remove a keystone species and watch the domino’s fall. Just evolution in action. Happened many times before and the only thing different is that the humans are the volcanism (on steroids) this time.
Jerome Purtzer on Wed, 22nd Feb 2017 1:49 pm
Fracking was/is a giant Ponzi Scheme. The only revolutionary thing about it has been the sales job. As the Rockman has pointed out the technology has been around for over 40 years. The fact that they keep dragging out this dead horse and selling it as a thoroughbred racehorse proves only that a sucker/investor is born every minute. The only mistake the peak oilers made was figuring the desperation factor. In WW II The Germans came up with the Fischer-Tropsch method for extracting diesel and other fuels from coal. This method is still used in South Africa as they have a lot of coal and little petroleum. This method is energy intensive and inefficient. Sounds like the tar sands and the shale rocks. No doubt coal liquefaction will be trotted out again as the answer to our FF problems. As the Rockman has also pointed out, the Peak Oil Dynamic is alive and well.
Davy on Wed, 22nd Feb 2017 2:00 pm
Jerome, our modern civilization is a Ponzi. Some parts worse than others. Fracking is on the edge of the worst of it. The reason being the ingredients that made fracking great where the product of the great crisis. Oil will never recover from the latest drop becuase the economy is now wounded. It may be hidden but the incongruities of what is value and malinvestment will eventually be plain to see. Currently a whole range of activities have no future and that is the classic definition of a Ponzi.
JamesTapper on Wed, 22nd Feb 2017 4:44 pm
“Of course, the peak oilers also failed to see the shale oil and gas revolution made possible by fracking and horizontal drilling that boosted U.S. oil production from 5.2 million barrels per day in 2005 to nearly 9 million barrels per day today.”
Do people not pay attention to anything that’s happened in the last two years? Like do they hibernate and wake up and see numbers and write this down? Only a moron would say shale is the future, shale is like drinking dirty filth water when there is no clean, drinkable water.
“Simmons further suggested that global oil production had peaked in 2005 and would fall at a rate of 5 percent year thereafter.”
Someone predicted a date wrong, therefore therefore the entire theory is wrong. This is character assassination and nitpicking at its finest. I’m still waiting for them to tell us more stories about finding infinite amounts of a finite resource, along with a perpetual motion machine.
“when it supposedly peaked – averaged 85 million barrels per day.The global average stood at over 97.2 million barrels per day in 2016.”
Oh great, another person who doesn’t understand the idea or word “peak”. You know what peak means? Top, plateau, no higher point. That’s what it means. When people talk about peak oil, they mean a point where the world will not produce a greater amount of oil. I mean just plot “World oil discovery” rates in the last ten years vs. “world oil consumption” rates in the last ten years and you’ll see how grim the situation actually is.
peakyeast on Wed, 22nd Feb 2017 5:06 pm
Ronald is obviously not very intelligent. I wonder why his guardian lets him embarrass himself publicly like this…
Nony on Wed, 22nd Feb 2017 6:44 pm
Rock: “…the peak oilers also failed to see the shale oil and gas revolution made possible by fracking and horizontal drilling that boosted U.S. oil production”. No, they didn’t.
Me: Check out The Oil Drum. How many articles in 2005-6 predicted the US doing 9.5 MM bpd a decade later? Even the few articles on the Bakken a couple years later (Rune, Piccolo) argued that EIA predictions were too optimistic. They were too conservative! And then we had articles by Stuart Staniford and the like about Saudi decline.
Antius on Thu, 23rd Feb 2017 6:30 am
“Simmons further suggested that global oil production had peaked in 2005 and would fall at a rate of 5 percent year thereafter.”
If I am not mistaken, 2005 was the year conventional oil production stopped rising started on its bumpy plateau. With huge amounts of low interest investment, the US and Canada were able to edge up production from tight oil and heavy oil, while losing tonnes of money in the process.
The exact shape of the world liquids production curve for the next 15 years is something that would have been near on impossible to predict in the early 2000s. But Simmons, Deffeyes and others correctly predicted that the mid 2000s was about the time that things would seriously start to go bad. And so it was.