[Specop_007]

So, post a year. Not a range, but a year that oil production slumps, Post Peak starts and society starts the downhill slide, with the accompanying OH CRAP coming from those who are not prepared for it.

I say 2008.

[Sencha]

The year we crash is the year I anticipate this one awesome PC game, that I never get to play because before buying it, the entire economy crashes.

Seriously though, let me think...

I'm going to say 2006. I suspect the next administration whether it be Bush's or Kerry's will have something seriously to do with Peak Oil.

I believe if they have anything to do directly with Peak Oil, it will be accelerating it. I would also guess that it would take time to make this happen, so not until the second year of the next Preisdent's term in office.

Also, looking at the rate at which oil prices are rising, I'd say that if it continues to climb uphill, coupled with administration involvement, something is going to happen around that year.

[Riddick]

Did you see the announcement of the troop movement?

It may be sooner than 2006.

[jato]

Riddick, don't leave me hanging! Post a link please. Or give us more info.

Found one: http://www.cnn.com/2004/ALLPOLITICS/08/ ... index.html

More troops to rotate into Iraq? Preparation for invasion of Iran?

[Riddick]

Sorry 'bout that.

Here's another one.

http://www.msnbc.msn.com/id/5707856/

I think he's doing that to take some of the pressure off the Iraq theater.......stay tuned though because they haven't scraped S. Bill 89 or H.R. Bill 125 either.

Look on the bright side man.........Nicky Hilton just got married!

Good God, somebody pray for us.

[jato]

So, post a year.

2010.

[Jack]

I'll go with 2009.

I would have been inclined to say 2008, but it looks as if Iraq won't be pumping as much as would otherwise be the case, plus price increases may reduce consumption a little.

5 years to party...

[OilsNotWell]

Wrong. Now.

Peak really won't matter now, since demand is currently outstripping supply, and any future production will be relatively neglible and won't be able to bridge the gap. It will become ever more apparent.

My humble opinion.

[OilsNotWell]

In other words, I think we're bumping the production ceiling now, in the sense that any future production increases will be more than gobbled up by increased demand, (after supply tried to catch up with demand, and didn't (now),) which raised prices, causing a slowdown, reducing demand, slightly lowering prices, which created more demand to use more supply, and so on for a little while longer (couple years). But then the bottom will drop out of supply rather noticeably, and there's no production going back up. So, we'll bump along the production ceiling for a little while longer.

Those wise enough will heed the warning.
Like when your engine's running out of gas, starts to sputter, goes a bit, then stops, sputters, goes a bit, sputters, then begins to slow.

[Barbara]

Totally agree with Oilsnotwell.

[Permanently_Baffled]

In other words, I think we're bumping the production ceiling now, in the sense that any future production increases will be more than gobbled up by increased demand, (after supply tried to catch up with demand, and didn't (now),) which raised prices, causing a slowdown, reducing demand, slightly lowering prices, which created more demand to use more supply, and so on for a little while longer (couple years). But then the bottom will drop out of supply rather noticeably, and there's no production going back up. So, we'll bump along the production ceiling for a little while longer.

Those wise enough will heed the warning.
Like when your engine's running out of gas, starts to sputter, goes a bit, then stops, sputters, goes a bit, sputters, then begins to slow.

I think this sounds like the most likely scenario, but do you mind if i ask a question? A lot of the posts i read suggest that production will decline quickly (anything upto 5% per year), why is this ? I notice that the US production peaked in 1970 and dropped by an average of 1% per year , why would the world be different?(source: BP stats review)

As for my prediction i will go for peak oil production in 2010 with a gradual decline in production from there on.

[smiley]

I think this sounds like the most likely scenario, but do you mind if i ask a question? A lot of the posts i read suggest that production will decline quickly (anything upto 5% per year), why is this ? I notice that the US production peaked in 1970 and dropped by an average of 1% per year , why would the world be different?(source: BP stats review)

Yes but look at the countries that peaked later. EG UK, Norway, Oman. They decline much faster than the US. Decline rates for these countries are in the order of 8-10%. The countries which are about to peak now (eg. Mexico) will have very steep decline rates.

This difference is due to technology. Technology has allowed us to produce the oil much more efficient and faster. This inevitably leads to higher decline rates.

The introduction of technology has temporarily slowed the decline of the US to <1%. Now that the effect of these measures is fading the depletion is accelerating again. This year we're 4% down.

[On topic]

I don't think that the mathematical peak is so important I think there are a few memorable years. I think matters will grow gradually worse as we're heading from crisis to crisis. As the oil price rises it will start to affect demand at some point so we may never reach the actual production peak.

2000-2001 The peak for UK and Norway (This is where the problems started and the oil price started its rise)

2004 Opec has run out of spare capacity, England has become a net importer.

The next memorable events would in my opinion be

The peak of Mexico 2004-2005
The peak of Russia 2005?

[Jack]

Wrong. Now.

Peak really won't matter now, since demand is currently outstripping supply, and any future production will be relatively neglible and won't be able to bridge the gap. It will become ever more apparent.

My humble opinion.

Perhaps. You're in good company.

That being said, I believe that Peak will matter. If demand is growing, but supply is growing slowly, then one has an inconvenient gap. But after Peak, demand will still be there, but the supply will decline, creating a much more problematic gap.

Suppose that one needs 2,000 calories per day. If one gets 1,900 calories, you'll be a little hungry, but you'll survive. If the gap is larger - say, you only get 1,200 calories - the problem is much more painful.

Just a thought.

[trespam]

I'm throwing my hat in with OilsWell. And will also comment that I don't think "THE PEAK" is what matters. There will be a peak in consumption. We may never see the actual peak in production. The earth may be capable of pumping a lot more oil--e.g. a few more million barrels a day--than right now but it doesn't matter. With consumption climbing so quickly, we're outstripping our ability to invest in new capacity to create those couple extra million barrels. The economy will tank and the consumption drop before we hit peak. At that point, we may continue to suck oil out for a few years at a lower rate and then, if new investment is put in place, the actual declines elsewhere will mean a peak lower than the previous consumption level (which was not at physical peak).

I think we've long since entered the age of more expensive energy. Now it's a matter of managing it.

I think the real question is when does REAL PANIC set into the oil markets. Or more precisely, when will consumption pass production. It seems like sometime in 2005. The economy is still growing, though has troubles, China's growth is slowing, but still vigorous. I think next year for sure.

[Permanently_Baffled]

Hold on a minute how can consumption exceed production trespam?

[trespam]

Hold on a minute how can consumption exceed production trespam?

Consider it this way. Suppose today the physical peak right now is around 85 m b/d. Remember that the peak is a physical/economic phenomena. Say you're peaking at 85, you might be able to throw a heck of a lot of investment to pull it to 85.5. But it makes no economic sense to pull out an additional .5 (because of diminishing returns).

So the world is pumping 80 and maybe using 79. Now the world needs 81 but we're only pumping 80. We can't invest quick enough to pull up to 81 (when we're assuming that 85 is possible) and therefore the economy recesses as prices are bid up. Consumption drops to 60 m b/d because the recession is hard and deep because of the high debt in the US and unstable growth in places like China. Now we consume at that rate (60) for many years. Consumption is now way below production capacity. We continue on for a while, maybe a few years, pulling oil out, easier oil.

Now the physical peak is shifting down as we pump. 85, 80, 75, 70. Consumption is increasing. Finally dropping production hits rising consumption. Maybe at 70. We're not pumping at that rate, so we don't know that the physical peak is. But low and behold, we can't pump above 70 without heavy investment.

I guess the point I'm making is that we may be 5 million barrels a day below physical peak. But we can't invest in Iraq to pull the production up to peak value. So the economy recesses and Saudi Arabia goes into decline. Now when Iraq stabilizes (will it ever stabilize), the production is increased. But the rest of the world is much further into decline.

Or think of it this way. Suppose 100 years ago we have the technology we have today. We could explore the entire world for oil, drill, and,on the same day, turn on capacity all around the globe simultaneously. The production at that time would have huge. We could have just dumped the oil onto the ground and pumped as hard and fast as possible. What could we have done? 200 m b/d? Who knows. It would have been huge. Over time that max decreases.

So all I'm saying, as a previous poster has, is that one may never actually hit peak. The economic disolation as one approaches peak is enough to depress the economy so production drops.

[Permanently_Baffled]

Ahhh i know what you mean now, sorry i was being a little picky

[OilsNotWell]

LONG POST ALERT

Everyone is making excellent points.

After thinking about even more, I have come to the realization that since oil is such a vital energy requisite for the world, there is far less demand elasticity as we might believe (sheesh, I sound like an economist, help me now!).

In order for us to grow, we need oil. We will try to pay any price. Our thirst will not be slaked for long. We've hit the ceiling, though, it seems. All we are really doing is just treading water, riding the plateau for as long as we can. The incremental increase in production is neglible (I've read we are producing around 83million b/p/d now (remember OPEC's numbers have been estimated to be off by 7.5% on purpose). That number is slightly above most peak-oil analyses I've seen of maximum production around 79-82million b/p/d.

So if "peak" comes at what, 85 million b/p/d, because we made a massive effort? Then what? How long can that be maintained??

As we all seem to know, that just means the cliff gets steeper. Mathematically, the sum total "under the curve" is the same, it's just the "shape" of the curve we are debating about! All the underlying nice, pretty bell curves get mashed, and pulled, and formed like silly putty into whatever peak we decide. Like the artificial peak of '79.

Imagine taking a hammer to our concept of the "peak" and flattening it out, and you get an idea of how the peak can be distorted, so it almost is a bit of a moot point. We "could" completely stop using oil tomorrow, and then "save" it all up for one big massive peak later, but who's going to do that?

I see a massive tug of war right now between the industry (OPEC, EIA, and politicos) trying to downplay any "fundamental" supply problems. See the fluff piece by Opec's president yesterday on oil.com's site for an example. He had the audacity to say the high price doesn't really reflect a problem in the fundamentals, nor in the supply/demand relationship! Now then, um, does that mean these higher prices resulted out of thin air? (maybe, if you consider that the market anticipates as much as possible, instead of reacts...)

Hmmm...I see my Master's thesis in Mathematics (a true measurement science as opposed to economics!) in this! Oh wait, won't have time....

[trespam]

LONG POST ALERT


Hmmm...I see my Master's thesis in Mathematics (a true measurement science as opposed to economics!) in this! Oh wait, won't have time....

marek is also working on this in economics at Chicago. You will have to compete with him.

On your point of equal areas: I've been reading a few books that propose energy taxes, that consumption of energy should be taxed, not labor, as is currently the case. Then there would be an incentive to minimize use of energy and to increase the amount of labor, which would help with employment. Because that would be a regressive tax, raising the prices of goods derived from processes that use energy (meaning just about everything), the poor would be paying a higher percentage of their income in taxes. So everyone gets an energy credit. This would be similar to a minimum salarly below which one is not taxed.

To me it is a much more efficient way to truly tax something. It would recognize that energy sources (in particular fossil fuels) are a sort of common good and that is what should be taxed, so that all benefit from it and so it is preserved for future generations.

[OilsNotWell]

For those future "oil-age" historians, mark 2004 on your calendars.

That was when our industrial/economic growth was truly limited by the availability of cheap oil. Our assumption that whenever we needed oil, it was there, is now wrong. We are from here on out limited by our true ability to produce.

We will see an ever-increasing amount of attention being played to "securing our energy independence" (conveniently after the election) instead of addressing the real issue of resource depletion.

Can you see it on CNN? "War for Energy Independence" or "War on Oil Terrorism!" Next stops: Iran, Saudi Arabia, and Venezuela!

(shudder).