[big_rc]

Fareed Zakaria makes a couple of very good points that I have been thinking about lately.

Story Here

First of all, although Peak Oil is primarily a physical phenomenon, I'm beginning to realize that the biggest impediment to increasing supply will be political not physical. Big Oil (Exxon, Chevron, BP, et al) has the technical capabilities to get the harder to reach oil but countries like Venezeula are severly restricting access to fields or making the investment climate in the country unprofitiable to Big Oil. Therefore, the necessary investments needed to boost output cannot be made.

Secondly, the US is the 800 pound gorilla on the demand side. As much as we want to talk about Chindia, the US is sucking up sizable portion of the world's supply. The issue here is the US pols lacks the political will to encourage conservation. So as much as we want to talk about geology, politics might be a bigger issue.

[big_rc]

Sorry to bring back this dormant thread but I just had a very interesting conversation that some of you might be interested in. I am fortunate enough to work for a Fortune 10 fully integrated oil company and I just had lunch with one of the very high level executives.

I had a chance to ask him about Peak Oil and he confirmed that it is undoubtedly true BUT he also said that the primary problem of diminshing oil supply is not technical (or gelogical) but political. Many of the countries that my company deals in are clueless when it comes to creating favorable investment climates that would stimulate the neccessary investments needed to boost oil production.

It's an interesting problem because many of the investments need to be made now in order to boost production seven to ten years from now but can't be made because countries like Venezeula are messing up the investment climate. Therefore, I go back to the original point of reviving this thread that Peak Oil is a geologic phenomenon but caused by political forces.

[rogerhb]

Many of the countries that my company deals in are clueless when it comes to creating favorable investment climates that would stimulate the neccessary investments needed to boost oil production.

This might be news to some people, but finding a way to produce more quicker does not make a finite resource last longer.

[mekrob]

I am fortunate enough to work for a Fortune 10 fully integrated oil company and I just had lunch with one of the very high level executives.

Me be wondering which company? I suggest you get your resume or start sucking up because I've been noticing a trend among the companies. Those that acknowledge peak oil are having quite a hard time with their fields and investments (Chevron). Others mock it but have growing or stable production numbers (BP, Exxon, Aramco, etc).

Edit: I am an idiot.

[emersonbiggins]

It's an interesting problem because many of the investments need to be made now in order to boost production seven to ten years from now but can't be made because countries like Venezeula are messing up the investment climate.

More "our oil under their sand" tripe? Surely, a sovereign nation is entitled to be as stupid/inefficient as they care to be in regard to their own resources. Hell, we built a motoring utopia on that idea...

[NTBKtrader]

Therefore, I go back to the original point of reviving this thread that Peak Oil is a geologic phenomenon but caused by political forces.

I would exchange the word excascerbated for the word caused.

[Lighthouse]

I would exchange the word excascerbated[sic] for the word caused.

The word you intended to use is excaserbated ...

[thethief]

Sorry to bring back this dormant thread but I just had a very interesting conversation that some of you might be interested in. I am fortunate enough to work for a Fortune 10 fully integrated oil company and I just had lunch with one of the very high level executives.

I had a chance to ask him about Peak Oil and he confirmed that it is undoubtedly true BUT he also said that the primary problem of diminshing oil supply is not technical (or gelogical) but political. Many of the countries that my company deals in are clueless when it comes to creating favorable investment climates that would stimulate the neccessary investments needed to boost oil production.

It's an interesting problem because many of the investments need to be made now in order to boost production seven to ten years from now but can't be made because countries like Venezeula are messing up the investment climate. Therefore, I go back to the original point of reviving this thread that Peak Oil is a geologic phenomenon but caused by political forces.

Iraq?

[big_rc]

It's an interesting problem because many of the investments need to be made now in order to boost production seven to ten years from now but can't be made because countries like Venezeula are messing up the investment climate.

More "our oil under their sand" tripe? Surely, a sovereign nation is entitled to be as stupid/inefficient as they care to be in regard to their own resources. Hell, we built a motoring utopia on that idea...

Yep. You are absolutely right. All countries are free to be as stupid as they want. I guess my point with this whole thread is that we don't have to be staring down the barrel of peak oil. There is plenty of oil all around the world but gaining access to it (and be assured that contracts will be honored) is the problem.

To give you an example, we talked about three countries in particular. Mexico still has a lot of oil (even with Cantarell dropping like a rock) but it is primarily deepwater. Big oil has the deepwater expertise that Pemex sorely lacks but are forbidden to produce oil in Mexico because it is written in their constitution.

Venezeula can easily double their output but multi-billion dollar investments are needed to do this and Chavez has wrecked PdVSA and Big Oil is turned off by Chavez screwing with already agreed upon contracts that were forcibly rewritten.

And to nobody's surprise, Iraq has a bunch of great petroleum plays but the political situation is a disaster right now.

So to make a long story short, the oil is there. Mankind is going to fall off the Peak Oil cliff through nobody's fault but our own.

[XOVERX]

I am not sure I'm following you, big_rc.

I understand you're saying there's still plenty of oil in foreign nations to sustain America's oil consumption.

I understand that you're saying these foreign nations lack the expertise to properly exploit their oil resources.

You have identified some issues, I understand that. But what are you suggesting thereafter?

Are you suggesting a military solution? That is, the US invading, say, Venezuela? Or what exactly?

[0mar]

Many of those oil companies were kicked out because they didn't pay taxes, avoided environmental regulations and were general dickholes to the countries in which they did business.

[big_rc]

Are you suggesting a military solution? That is, the US invading, say, Venezuela? Or what exactly?

There is no solution to this problem. The US can't invade Venezuela and the US will never kiss Chavez behind also. Foreign leaders will still exploit their resources and wreck their economies by changing the rules as they see fit. US politics will not allow Americans to take sensible steps to reduce our dependence or even broach the topic with other nations. I guess what frustrates me so much is that there is both a supply and demand solution to peak oil (although the demand solution is MUCH cheaper and easier) but politics is and will continue to be the major impediment to solving peak oil (not any physical limitations). I'm just annoyed at this whole stupid situation because there are multiple solutions to this problem and it looks like our leaders are gladly going over the cliff and might take millions of people with them.

[peaker_2005]

I would exchange the word excascerbated[sic] for the word caused.

The word you intended to use is excaserbated ...

I believe it's spelt exacerbated.

[XOVERX]

Ah, frustration. Yes, big_rc, frustration -- there's a sentiment I understand. And with which I can completely agree.

If the nation brought it's focus to the problem of peak oil, solutions might well be developed. Both on the demand and on the supply side, as you suggest.

But America is a nation of polarization, of religious influence bordering on fanaticism, of a nation with leadership more interested in non-existent burning flags, pledges of allegiance, forbidding stem cell research and the removal of artificial life support for brain-dead Terri Schiavos, than in admitting real problems exist and finding solutions to those real problems. Real problems that will destroy the nation, and the world, such as peak oil, and its twin brother, global warming.

It is time to accept the obvious: Civilization is doomed. Starting in the United States of America.

[Scactha]

We keep hearing this excuse more often than not now. What is happening is that the West is on the retreat from having had a free reign to squander away others resources. The funny part is that suddenly it´s bad business and unfair when we are at the wrong end of the stick.

In fact it´s alot of logic geopolitically to not raise production as the one that is suffering the most is the biggest meddler of the all; the US. Why not earn a Rubel and rewrite the map of influence at the same time?

[mekrob]

I guess what frustrates me so much is that there is both a supply and demand solution to peak oil (although the demand solution is MUCH cheaper and easier) but politics is and will continue to be the major impediment to solving peak oil (not any physical limitations).

So let me get this straight: you think that PO would go away if there were no politics involved, just technical know-how? Ok, fair enough. But let's consider if Mexico could double their production through deepwater investment, Venezuela the same through heavy or other fields, Iraq through a safe environment, Central Asia through better contracts, Russia through more desire to produce, Nigeria from peace, and Saudi Arabia from transparency and open investment. How much longer would that really extend PO? Let's see, with highly optimistic numbers I think we could achieve an increase of 25 mpd:
Mexico: 3 mpd
Venezuela: 3 mpd
Iraq: 5 mpd
Central Asia: 4 mpd
Russia: 3 mpd
Nigeria: 2 mpd
SA: 5 mpd
(feel free to correct me, but I'm going off of my offhand knowledge of major fields and projects in those nations and your comments)

25 mpd added onto the 85 mpd now plus say 10 mpd more from other nations for a total of 120 mpd. With a growth of just 1% per annum, we'll hit peak in 35 years.
1.5%: 23 years
2.0%: 17.5 years
2.5%: 14 years
3.0%: 11.5 years

Even with very modest growth (1%), we'll still hit PO within 35 years. I don't see how magic supply can solve PO, like you say.

[emersonbiggins]

Even with very modest growth (1%), we'll still hit PO within 35 years. I don't see how magic supply can solve PO, like you say.

I don't think it can either. It's one of those "in a perfect world, ..." situations that's fun to kick around, but highly improbable. 35 years might have gotten us to cold fusion, though, and certainly would have provided time to ramp up renewables and transition projects. But, like I said, we're all speculating on what won't happen...

[FairMaiden]

I don't understand how you can point the finger at some countries and say, "they aren't supplying their maximimum and therefore are the problem"...how do you know they aren't smart enough to keep foreign investers out bc they don't want to pull their oil out at the fastest rate possible? Perhaps they have been underproducing to make it to the expected highs we have today? If some country wants to be a pig and not restrain itself, they can't go around blaming other ppl for not feeding them...

US politics will not allow Americans to take sensible steps to reduce our dependence or even broach the topic with other nations

Here is the REAL problem...