[Graeme]

Has the World Already Passed “Peak Oil”?

The year 2006 may be remembered for civil strife in Iraq, the nuclear weapon testing threat by North Korea, and the genocide in Darfur, but now it appears that another world event was occurring at the same time—without headlines, but with far-reaching consequence for all nations.

That’s the year that the world’s conventional oil production likely reached its peak, the International Energy Agency (IEA) in Vienna, Austria, said Tuesday.

According to the 25-year forecast in the IEA's latest annual World Energy Outlook, the most likely scenario is for crude oil production to stay on a plateau at about 68 to 69 million barrels per day.

In this scenario, crude oil production "never regains its all-time peak of 70 million barrels per day reached in 2006," said IEA’s World Energy Outlook 2010.

nationalgeographic

[Pops]

Thanks Graeme, I forgot...

http://www.worldenergyoutlook.org/

[Graeme]

If you are prepared to pay for it.

[Pops]

The summary says we won't have a geologic peak because we're going to increase renewables fast - like really fast - starting tomorrow - or maybe this afternoon...

Oh I forgot, we do that because we are all worried about GW...

Snort...

Fact Sheet PDFs

[Graeme]

Well, we are touchy today. But you're right, the fact sheets can be viewed for free here. Plenty of points to ponder including this one:

The eventual peak in oil will be determined by factors affecting both demand and supply. In the
New Policies Scenario, production in total does not peak before 2035, though it comes close to doing
so. By contrast, in the 450 Scenario, production does peak, at 86 mb/d, just before 2020, as a result
of weaker demand, falling briskly thereafter. Oil prices are much lower as a result. The message is
clear: if governments act more vigorously than currently planned to encourage more efficient use of
oil and the development of alternatives, then demand for oil might begin to ease soon. As a result,
we might see a fairly early peak in oil production, which would help prolong the world’s oil reserves.

[Pops]

Well, we are touchy today.

Sorry, didn't mean to sound touchy.

I was looking for something a little more realistic than "government will do a bunch of [insert magic stuff here] and then we'll reach Peak Demand."

Some governments might be going to do something about replacing fossil fuels tomorrow but I'll bet you a doughnut it won't be the US government.

Al Gore dreamed up all that global warming manure just so he could get rich --- donchano.

[lper100km]

Why is the Peak always coupled to the Production Rate? This single parameter is not a reliable indicator of anything. Production can be varied according to the economic conditions of the time up to it’s geologic ceiling. What is equally relevant is the peak in reserves – the actual midpoint of consumed to date vs estimated recoverable reserves. The indications are that this peak was reached in 2006. I don’t see how it’s possible to make predictions without taking both parameters into account. Of course, estimates of reserves are anything but reliable also, but you still can’t have one without the other.

Since, if by definition we have peaked, there is now only a ‘known’ finite volume remaining for recovery and every bbl taken reduces the reserves accordingly. Presumably recovery becomes more difficult and thus slower as time goes by, so that at some point, there could be significant oil remaining even as the production tends to zero, at least relative to the numbers we are used to seeing now. It’s possible that oil could be produced for another 100 years or so, maybe more – but in such reduced flow that the general population can forget about using any for themselves.

From a PO perspective, we should hope for a no growth economy at most. That’s unlikely to happen since everyone is striving to restore bau as fast as possible. Well, that’s fine, except that after a delusional starburst of well being, we’ll be set to enter an unending period of economic decline.

What is always overlooked is that any alternative energy ‘solution’ is wholly dependent upon using our present oil infrastructure as a crutch. Without it, it can’t stand. It doesn’t really matter if techno fixes are not ready for another 90 years (see other thread oil-will-run-dry-before-substitutes-roll-out-study-t60029.html), since they could not function anyway without an oil based infrastructure.

[rdsaltpower]

Sounds like we have passed peak gas consumption in the US. http://news.yahoo.com/s/ap/us_guzzling_less_gas

[dolanbaker]

Fuel consumption in Ireland has dropped some 10% since 2006, much of that can be put down to the death of the celtic tiger.

Problem will be when they try to grow the economy again, the oil wont be there!

[Keith_McClary]

Sounds like we have passed peak gas consumption in the US. http://news.yahoo.com/s/ap/us_guzzling_less_gas

"A combination of demographic change and policy change means the heady days of gasoline growing in the U.S. are over," says Daniel Yergin, chairman of IHS Cambridge Energy Research Associates

Peak Oil Theory – “World Running Out of Oil Soon” – Is Faulty; Could Distort Policy & Energy Debate
14 NOV 2006

CERA finds that not only will world oil production not peak before 2030
...
“It is likely that the situation will unfold in slow motion and that there are a number of decades to prepare for the start of the undulating plateau. This means that there is time to consider the best way to develop viable energy alternatives that would eventually provide the bulk of our transport energy needs and ensure that there is a useable production stream of conventional crude for some time to come,” CERA concludes.
...Peakists’ projections of the date a peak would be reached continue to come and go, the most recent targeted around Thanksgiving Day 2005, give or take a few weeks.

[Tanada]

Well, we are touchy today. But you're right, the fact sheets can be viewed for free here. Plenty of points to ponder including this one:

The eventual peak in oil will be determined by factors affecting both demand and supply. In the
New Policies Scenario, production in total does not peak before 2035, though it comes close to doing
so. By contrast, in the 450 Scenario, production does peak, at 86 mb/d, just before 2020, as a result
of weaker demand, falling briskly thereafter. Oil prices are much lower as a result. The message is
clear: if governments act more vigorously than currently planned to encourage more efficient use of
oil and the development of alternatives, then demand for oil might begin to ease soon. As a result,
we might see a fairly early peak in oil production, which would help prolong the world’s oil reserves.

Thanks for posting this, however I feel compelled to point out that if demand falls and that brings the price down then more end users will be inclined to burn petroleum as a cheap alternative to whatever the substitute is. This is the phenomenon that shot shale oil right in the head about 1986, after companies had poured Billions into designing and proofing recovery methods KSA dropped the world price through the floor by flooding the market and all those plans died a grim and expensive death.

[Xenophobe]

Why is the Peak always coupled to the Production Rate? This single parameter is not a reliable indicator of anything.

Quite correct. However, Hubberts original work has taken on near Biblical status among those who aren't familiar with economics, geology, finance and human behavior in general.

Production can be varied according to the economic conditions of the time up to it’s geologic ceiling. What is equally relevant is the peak in reserves – the actual midpoint of consumed to date vs estimated recoverable reserves. The indications are that this peak was reached in 2006. I don’t see how it’s possible to make predictions without taking both parameters into account. Of course, estimates of reserves are anything but reliable also, but you still can’t have one without the other.

Reserves tend to be proportional to production at most points in time. For example, in about 1920 we had 10-15 years of reserves for current US production rates. Same as in 1950. Same as in 1970. Same as in 2005. Its almost as though Adam Smiths invisible hand has determined an inventory level, and we humans develop about as much as we need to carry 10+ years of inventory at any one point in time.

This ratio does not appear to apply to world level reserves however, globally we have quite a bit more in inventory because...well....abundance is a dirty word around here, but its very applicable to the global inventory levels.

[Xenophobe]

When we reach a peak in production we have then consumed the first half of the total reserves. This relationship has been verified many times

No, it hasn't. Volume weighting the worlds discovered oil, by country, to which countries fit anything resembling a Hubbertian profile, and which don't, means that 75-80% of the world oil volumes DON'T follow Hubberts curve. Hubberts own example don't follow Hubberts decline, Ohio being the prime example of course. Dismissed as depleted by Hubbert(1956) it nearly achieved another oil peak in the 1970's, some 7 or 8 decades after its first peak.

So...to answer the topic...of course we've already passed "peak oil", just as we have times in the past, the only other claim being more prolific than the occurrence of peaks themselves are the number of times people have declared them. David White in 1919 springs to mind as a more famous example of a declared peak in the US.

[TheDude]

Sounds like we have passed peak gas consumption in the US. http://news.yahoo.com/s/ap/us_guzzling_less_gas

But this time looks different. Government and industry officials — including the CEO of Exxon Mobil — say U.S. gasoline demand has peaked for good. It has declined four years in a row and will not reach the 2006 level again, even when the economy fully recovers.

2007 consumption was up 33 kb/d. Explain to me why driving won't pick up again - are people just going to suddenly tire of seeing the country or commuting whatever distance it takes to get to work? I don't think so.

Some math: YOY change in US gasoline demand for 2008-2010 was -297/-4/111, this last being tentative of course but won't change by much unless every car in the country grinds to a halt this instant. Add 'em up and you have cumulative savings of -189.97 kb/d, which will be largely gone next year, all LEAFs and Volts notwithstanding a whit. Don't these clods understand anything about market penetration, the size of the fleet vs production volume? This isn't rocket science.

[Xenophobe]

Hubberts own example don't follow Hubberts decline, Ohio being the prime example of course. Dismissed as depleted by Hubbert(1956) it nearly achieved another oil peak in the 1970's, some 7 or 8 decades after its first peak.

So you found an exception. Big shit. Hubbert's method is a model. Do you know what a model is? It is a a hypothetical description of a complex entity or process. It approximates reality. Statistically, over the long run, Hubbert's model is useful in predicting the rise and fall of oil producing regions. Dipshit.

I didn't find A exception, I found that 75-80% of the worldest oil DOESN'T follow Hubberts concept. Your opinion on this fact is irrelevant, as it is with all other facts. They simply are, your endorsement of them is of no more value than your denial of them.

There are hundreds of oil producing fields, regions and nations that follow a classic Hubbert's curve. You are barking up the wrong tree.

I am not barking, and I stand by my earlier factual statement. Don't feel poorly about it, you aren't the only one who really makes mistakes when it comes to confusing production and reserves and what size aggregation follows what sized profile. Here is a classic example of Colin misrepresenting well production for example, in his Scientific America work:



The clue being, oil wells don't produce that way. Here is a reasonably relevant SPE paper on the topic. Not that I expect you to understand the math involved, but no one can say that I don't try and educate the most feeble.

http://www.pe.tamu.edu/blasingame/data/0_TAB_Public/TAB_Publications/SPE_028688_(Doublet)_Material_Balance_Decline_Type_Curve_An.pdf

So, for the feeble...pictures!

a) Oil production is measured by different standards. You know this because I have explained it to you a dozen times. C+C and All llquids are different metrics used by EIA, IEA and BP. Also oil production values are measured over different time periods. Averaged monthly,yearly, and for single periods. Of course there are different peak reported. Why don't you fix this and come up with a universal measure that applied to all conditions. Do it or shut the fuck up troll.

Why..how expressive of you! Fortunately, I have already attached Stuarts most recent analysis to the NEXT peak oil, and the metrics he, as an ex-TOD expert on the topic, has decided to use. Feel free to quote something of your to refute his analysis, or just revert to more foul language as a substitute for actual thought on the topic.

b) Regarding White: That one person was wrong in one particular ancient guess does not discredit the idea of prediction. WE all make our best attempts at predicting our own futures. I predict that you will go fuck yourself.

Goodness! Such anger and resentment! Vicious ad hom deleted

[dsula]

There are hundreds of oil producing fields, regions and nations that follow a classic Hubbert's curve. You are barking up the wrong tree.

?

There's no reason for the curve to be symmetrical. It could be ANY bell-like shape, slow climb, steep fall. The important think is it goes back to zero, whereas the world hopes for it to climb forever.

[Xenophobe]

There are hundreds of oil producing fields, regions and nations that follow a classic Hubbert's curve. You are barking up the wrong tree.

?

There's no reason for the curve to be symmetrical. It could be ANY bell-like shape, slow climb, steep fall. The important think is it goes back to zero, whereas the world hopes for it to climb forever.

The Ohio example I referenced went up...like in 1890...and then crashed. Hubbert referenced it as an example of his concept in 1956. Except...starting in the early 70's...it started going up again! Didn't quite achieve the 19th century peak, but it got close!

I suppose I could whip out the Michigan Silurian reef development as another example of how the geology matters in these things, but I doubt it would matter.