Peak Oil is You

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Page added on February 7, 2018

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Will Peak Oil Come Anytime Soon?


Our taste change, technologies evolve, live goes on and whether we like it or not, the world changes every day. To put it bluntly, change is inevitable. Although it’s an inevitable reality of our world, it doesn’t mean that we’re on the verge of it.

On January 24, 2018, British Petroleum (BP) held its annual Energy Outlook forum. At this discussion, BP tells its investors and other interested parties its short and long term predictions for the petroleum industry. Far from the bearish outlook on the petroleum market held by some observers, British Petroleum was considerably bullish in its outlook. In their report, the company concluded that oil demand will continue growing into the 2050’s due to projected growth in the plastic goods market. Similar to BP’s position, Organization of Petroleum Exporting Countries (OPEC) announced in November 2017 that, despite a global shift to cleaner energy sources by developed countries, oil demand will continue to rise for at least the next five years . Even the United States, due to recent deregulation and rise in investment, is projected to break records by becoming the world’s largest oil producer.

In September 2017, Saudi Arabia finally allowed its female citizens to drive vehicles. While driving is simply a part and parcel of life for most adult women in the United States, this move was certainly a major step towards equality in Saudi Arabia. But, as many have correctly pointed out, this was not just a move by the relatively liberal Prince Mohammed bin Salman to extend rights to half of his subjects. Instead, it was a strategic decision to help diversify the kingdom’s economy in an age of uncertainty over the efficacy of oil. This is a true statement by all accounts, as Saudi Arabia has been far too reliant on its primary export for revenue.

Many point to Saudi Arabia’s economic reform as a tell tale sign of a coming abrupt and sharp decline in global usage. Unfortunately for them, a drastic change of this magnitude in the span of a few years is a pipe dream. The developed and industrialized world is still very much reliant on oil for almost all facets of modern life. Total energy usage in the United States, while comparatively cleaner than previous decades, is still projected to grow by 5% by 2040. The plastics industry is predicted to grow substantially, as it has the potential to reach a USD value of $654.3 billion by 2020. This growth in plastics is similarly represented globally as well, giving the petroleum industry a much needed breath of fresh air.

But the overall growth is not just represented by the progress in the plastics industry. We have been hitting all time highs in gasoline consumption. But how can that be if we’re also hitting records in the number of electric vehicles hitting the roads? The answer is more straightforward  than you think: there are more cars on the road now than ever before. Far from sensationalist headlines proclaiming that the end of gasoline engine cars is nigh, there are simply more cars around – both electric and combustion. Driving cars that utilize gasoline as their energy source is still more reliable and oftentimes cheaper than currently available electric cars.

Much of this may come as a great disappointment to those who wish to have a cleaner Earth. And to be frank, this certainly goes against the current zeitgeist of ridding our societies of fossil fuels. Maybe in the future more of us will be driving electric cars on energy not derived from petroleum, but as of 2018, this dream is unrealistic. And while we ourselves in the developed world should strive for the use of cleaner energies, the use of petroleum has proven to be imperative to the growth developing economies.

In 2013, the demand for oil in the developing world surpassed that of the wealthiest nations on Earth. At that point, exports of crude oil from West African countries were beginning to skyrocket. By and large, their oil has been shipped to newly industrialized economies, such as India, China, Brazil, Indonesia, and a handful of other countries. This oil has not only fueled the economic growth of the latter countries, but also to the even less developed economies. For many countries, the use of cheap fossil fuels has decreased levels of poverty’ and while many developing countries still face social and economic obstacles, the increasing use of oil is a sign of economic growth. Angola, one of Africa’s key exporters of oil, has seen its GDP rise from 9.1 billion USD in 2000 to 89.6 billion USD in 2016. Nigeria has fared even better than Angola, seeing its GDP rise from 46.4 billion USD in 2000 to 405.1 billion USD in 2016. In the near future, economic activity in these countries will stimulate industrialization and we can expect other developing countries to follow suit.

An oilless world isn’t unattainable, but it just won’t come around as fast as some may think. It’s a gradual process, and renewable energy will inevitably catch up in terms of cost-effectiveness. Peak oil demand hasn’t hit us, nor will it in the immediate future. For now, oil is here to stay.


14 Comments on "Will Peak Oil Come Anytime Soon?"

  1. Davy on Wed, 7th Feb 2018 6:53 am 

    An oilless modern world is likely unattainable. Peak oil demand is a gradual process of a mix of economic decline and renewable penetration. This is a systematic process of both decline and change. It has an unknown forecast because decline is the element and decline has a degree of randomness and abandonment. Will decline become dangerously destructive or just adaptively destructive? Will renewables make a significant penetration during this process? This may be an end game process but is that end game far enough in the future that we can consider it as unimportant for the immediate status quo humans tend to dwell in? That point means we may see destructive change with innovating development in an undulating plateau of growth and decline. The general trend will be to an end game but if no significant shocks occur that destroy the foundation of this process then we can assume more status quo.

    Renewable energy will likely hit economic and technical hurdles but maybe not until after significantly delaying a civilizational collapse. It will be like Byzantium Rome in a sense. This will be a matter of triage and primitive burrowing-like behavior of protection from a civilization exposed to multiple collapse vectors. Parts of society and nations globally will be triaged from the protective core. It must happen because depletion and general decline are working in one direction as population grows and aspirations of affluence spread in the other. There will be less and less sustainable development and more and more wealth transfer and stealth exploitation.

    The disenfranchised masses will have little to fight against this. The reason for this helplessness is this is a self-organizing process of competitive cooperation among global nations. It is also human nature. Of course this is a Ponzi scheme and they always end. We will see a continuation of bubbles because bubbles are now the primary tool of growth. They are also a primitive tool that cuts both ways. We will see more moral hazard of extending debt that doesn’t perform. There will be more pretending that markets are still free, price discovery honest, and opportunities fair.

    This is a late term civilization with plenty of productive capacity left. It is also a late term planetary system of ecosystem and climate destruction. All of this will play out over a short time in a historical sense but a longer term for human experience. This is likely a decadal process of one are two more decades. This is an eternity for humans but a wink for history. But don’t be fooled by this contingent optimism. A quick and hard collapse could come at any time. This is the nature of a late term global civilizations near the end and close to the cliff. Once it happens it will all come down together and quickly. Near the end time speeds up and small changes can cause wide swings.

  2. Sissyfuss on Wed, 7th Feb 2018 9:33 am 

    One reason gasoline consumption is growing is because there are more cars being put into use because there are more people coming on line every day. The developing countries want the freedom that a personal vehicle portents but doesn’t deliver. As far as plastic production increasing is concerned, we are going to have to find more ocean territory to store our floating gyres then.

  3. bobinget on Wed, 7th Feb 2018 9:48 am 

    Total products supplied over the last four-week period averaged over 20.8 million barrels per day, up by 4.8% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 8.9 million barrels per day, up by 6.5% from the same period last year. Distillate fuel product supplied averaged 4.2 million barrels per day over the last four weeks, up by 8.9% from the same period last year. Jet fuel product supplied is down 0.6% compared to the same four-week period last year.

  4. bobinget on Wed, 7th Feb 2018 9:53 am 

    (hundreds of flights were cancelled due to weather) Last week’s consumption report
    was also bullish in EVERYTHING but jet fuel.
    If this is a trend, look out below….

  5. MASTERMIND on Wed, 7th Feb 2018 10:07 am 

    As M. King Hubbert (1956) shows, peak oil is about discovering less oil, and eventually producing less oil due to lack of discovery.

    IEA Chief warns of world oil shortages by 2020 as discoveries fall to record lows

    Saudi Aramco CEO sees oil shortage coming as investments, oil discoveries drop

    Peak Oil Vindicated by the IEA and Saudi Arabia

  6. MASTERMIND on Wed, 7th Feb 2018 10:08 am 

    Existing oil reserves are scheduled to begin a catastrophic crash within 1 to 3 years. When it hits the economic and social damage will be catastrophic. The end of Western Civilization, from China to Europe, to the US, will not occur when oil runs out. The economic and social chaos will occur when supplies are merely reduced sufficiently….

  7. MASTERMIND on Wed, 7th Feb 2018 10:09 am 

    The End of the Oil Age is Imminent

    Recently, the HSBC oil report stated that 80% of conventional oil fields were declining at a rate of 5-7% per year. This means that there will be an oil shortage of ~30 million barrels per day by 2030 and ~40 million barrels per day by 2040.

    What is mentioned far less often is that annual oil discoveries have lagged annual production since the 1980s.

    Now, this problem has nothing to do with the recent decline in the oil price, which started in 2014. This has been an on-going problem for the past 30 years. Now, the IEA is predicting oil shortages by ~2020 due to declining exploration.

    Here, the IEA blames this problem on the low oil price. But, this problem started in the 1980s. The problem is geological: we are running out of conventional cheap oil. Shale and tar sands are not the answer, either. Those resources are far too expensive, compared to conventional oil, because the global economy is based on cheap conventional oil. Expensive oil is not a replacement for cheap oil.

    Based upon the HSBC report and the IEA, the End of Oil Age will start around ~2020: there will be a dramatic economic depression due to exhaustion of cheap oil. This will cause a global economic collapse.

  8. MASTERMIND on Wed, 7th Feb 2018 10:09 am 

    UC Davis Study: It Will Take 131 Years to Replace Oil with Alternatives (Malyshkina, 2010)

    University of Chicago Study: predicts world economy unlikely to stop relying on fossil fuels (Covert, 2016)

    Solar and Wind produced less than one percent of total world energy in 2016 – IEA WEO 2017

    Fossil Fuel Share of Global Energy since 1990 – BP 2017

  9. bobinget on Wed, 7th Feb 2018 10:36 am 

    As long as we have US troops by the tens of thousands in war zones around the world, there will always be unhealthy unproductive, oil demand.

    If another twenty years in Afghanistan is any indication ‘peak oil’ is just around the corner.

    If Trump doesn’t get more military funding, today he closes down the government.(gotta stop Muller)

  10. Anonymous on Wed, 7th Feb 2018 12:28 pm 

    Not soon enough for ASPO or The Oil Drum. They done shut down. Out of shame. So much for the 2005, I mean 2008, I mean 2010 peak projections.

  11. Cloggie on Wed, 7th Feb 2018 10:53 pm 

    Waiting for peak oil (supply) is like Waiting for Godot:

    Godot will never arrive.

  12. MASTERMIND on Wed, 7th Feb 2018 11:05 pm 


    As M. King Hubbert (1956) shows, peak oil is about discovering less oil, and eventually producing less oil due to lack of discovery.

    IEA Chief warns of world oil shortages by 2020 as discoveries fall to record lows

    Saudi Aramco CEO sees oil shortage coming as investments, oil discoveries drop

    Peak Oil Vindicated by the IEA and Saudi Arabia

    Out with the old in with the new!

  13. MASTERMIND on Wed, 7th Feb 2018 11:07 pm 


    I suggest you listen to the IEA and Saudis’ they are the worlds top two energy leaders.

  14. TommyWantsHisMommy on Thu, 8th Feb 2018 12:46 pm 

    The positive is that the longer it takes to crash, the more time to build wind/solar *nukes in other countries*. More time to *start* to switch over to electric (or at least get the technology in place to build on bigger scales). The new Nissan Leaf looks like a winner and next year it gets and even bigger battery pack (over 200 miles a charge). I still think infrastructure (charging) is going to be a big problem in this country (when masses all want to charge at same time).

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