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Page added on September 18, 2019

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The Concept of Peak Oil has Shifted


A particularly fascinating development in this current decade is that the concept of what ‘peak oil’ means has shifted, Mohammad Sanusi Barkindo, OPEC Secretary General, said at the Fifth Iraq Energy Forum in Baghdad, Iraq, Trend reports.

“At the beginning of the 2010s, reports of peak supply were almost omnipresent; however, we are about to conclude the decade when this purported ‘worry’ has shifted to concerns about ‘peak demand.’ Peak demand fears do not necessarily reflect market fundamentals or the overwhelming majority of long-term forecasts of most reporting agencies,” he said.

Barkindo noted that in the long term, as OPEC’s flagship publication the World Oil Outlook has shown, world oil demand is set to grow considerably in the future.

“Long-term oil demand is expected to rise to almost 112 mb/d by 2040. This will be primarily driven by developing countries: their expanding middle class, high population growth rates and strong economic potential. Looking at the road transportation sector and the idea that electric vehicles are about to replace conventional vehicles; it should be noted, that according to our WOO, although the rate for new sales of electric vehicles is very high, the share in total stock in 2017 was just 0.3% and 1.3% of total vehicle sales,” noted OPEC’s secretary general.

He pointed out that while the long-term share of electric vehicles in the total fleet is projected to expand and reach a level of around 13 percent by 2040, conventional vehicles will constitute the majority of growth of the total vehicle fleet. “For example, ICE vehicles are expected to maintain their dominant share of new commercial vehicle sales over the forecast period. Although their share declines from 96 percent in 2017 to 81 percent by 2040, this still constitutes an overwhelming majority.”

“Furthermore, just as technological innovation defied the ‘peak supply’ prognosis, I believe it will play a pivotal role in assuaging ‘peak demand’ concerns. Many link the fate of future of demand with concern regarding the environmental credentials of oil. Technological innovation, particularly energy efficiency improvements, fuel efficiency standards and carbon capture and storage offer promising avenues to reconciling the conflicting components of the energy trilemma,” said Barkindo.

In late 2018, OPEC and a number of countries outside this organization (OPEC+ format) decided to modernize the terms of the agreement on the reduction of oil production, in force from the beginning of 2017. The countries agreed to reduce the total production by 1.2 million barrels per day from the level of October 2018.

On July 2, 2019, a decision was made in Vienna to extend the agreement on reducing oil production by OPEC member and non-member states until the end of the first quarter of 2020.

iran energy

13 Comments on "The Concept of Peak Oil has Shifted"

  1. Reality Corp on Wed, 18th Sep 2019 10:19 am 

    “.. Technological innovation, particularly energy efficiency improvements, fuel efficiency standards and carbon capture and storage offer promising avenues to reconciling the conflicting components of the energy trilemma,”

    Yes, techno-optimism — prepare for ensuing disappointment.

  2. Cloggie on Wed, 18th Sep 2019 12:00 pm 

    The 2011 idea that somehow supply of oil, coal and gas (in that order) would soon begin to decline (“peak fossil”), that idea is no longer valid. There is enough to fry us all. The problem is: too much supply, not too little. True, the quality is less, but that is more than compensated by increased efficiency, saving and improved technology. And there is an entirely new renewable energy world emerging.

    If there is global destabilization coming, it won’t be “peak oil”, but shifting geopolitics. Oil supplies could be very well diminished by war, but not by geology.

  3. Robert Inget on Wed, 18th Sep 2019 12:26 pm 

    Whose ‘foreign policy is it anyway?
    “CNN reports that the White House had ordered the Pentagon to plan several alternatives for a response to the Saudi attacks. However, President Trump warned that steps were not to be taken before Riyadh decided how to respond to the attacks”

  4. Robert Inget on Wed, 18th Sep 2019 12:33 pm 

    POO drops when Trump chooses sanctions instead of bombs.
    Saudis know they will lose 100% of oil revenue
    is Iran is attacked.
    Trump sees his reelection efforts doomed if he
    chooses to attack Iran.

    If however KSA chooses to sue for peace in Yemen, life goes on in the M.E.

  5. Davy on Wed, 18th Sep 2019 1:23 pm 

    (“peak fossil”), that idea is no longer valid.”

    There is peak economic fossil and that is more valid than ever. We are real close.

  6. Davy on Wed, 18th Sep 2019 1:26 pm 

    Whose ‘foreign policy is it anyway? “President Trump warned that steps were not to be taken before Riyadh decided how to respond to the attacks”

    So, Bob, does the US get to decided other countries fate per the bobignet doctrine?

  7. Outcast_Searcher on Wed, 18th Sep 2019 2:15 pm 

    One of the problems re such commentary is what is meant by EV’s.

    Projecting 14% BEV’s by 2040 might be low, but isn’t ludicrous, IMO.

    Projecting ALL EV’s, including HEV’s, which are already pretty great re MPG (especially for the city) for only a $3500ish price premium with the technology Toyota is licensing, at only 14% by 2040 IS total nonsense, IMO.

    For one thing, all the ICE banning in central cities in Europe (and the trend is spreading) is going to bite a LOT on pure ICE’s, even if fuel prices stay moderate in coming decades.

    It looks to me like OPEC is largely talking their own book here — which isn’t surprising.

    OTOH, total oil demand only growing 12% in 21 years isn’t much, given past growth rates. So they’re not blatantly just talking their book.

    And of course, the super-greens, pretending like all oil will go away in 5 to 10 years is pure nonsense.

    So it’s a horse race. Bring on the popcorn.

  8. Harquebus on Wed, 18th Sep 2019 10:07 pm 

    Peak oil has been masked by the biggest debt bubble in history and that mask is falling off.
    What’s that saying? You can put lipstick on a pig but, it’s still a pig.
    Debt is lipstick and diminshing returns is the pig.

  9. makati1 on Wed, 18th Sep 2019 11:09 pm 

    Harq, the debt bubble has been blown with every kind of magic money printing, lies and wars of choice since at least 2000. We are going to hear the ‘nuclear’ explosion around the world soon. I hope you are prepared.

  10. makati1 on Wed, 18th Sep 2019 11:13 pm 

    Nonsense Outcast? When the financial system goes down, so does everything else, including greeny and oily stuff. The reset will be to a level more 3rd world than 1st. Demand for everything will be way down, and many things will not survive the change, including electric cars, capitalism, etc. But then, you will not agree…so…we shall see.

  11. print baby print on Thu, 19th Sep 2019 12:02 am 

    Peak demand is one more bullshit story , which is supposed to keep price of oil in balance . Let it be it is better than collapse , which is by the way inevitable , because of the oil supply constraints of course . But one question for argument sake . Would it be any ‘ demand ‘ question if oil is available and at affordable price ? I think not, we all would drive more with pleasure.

  12. Sissyfuss on Thu, 19th Sep 2019 8:58 am 

    Peak conventional, easy to extract, high potency oil occurred a decade ago and EROEI has been eating away at Ind Civs functionality ever since. Hence the need for Ponzi economics since 2008 which cannot be sustained. Nothing can solve our overshoot dilemma than severe undershoot which is guaranteed in our future. Growth in a growthless system is reaching an endpoint that will be forcibly denied as long as possible.

  13. Cloggie on Fri, 20th Sep 2019 12:49 pm 

    “World made by hand”

    Danes create bridge from the days of King Bluetooth, 1000 years ago, exclusively with the tools of 1000 years ago:

    Personally I don’t think we are going to fall back THAT far, nevertheless these kind of projects are good for community building… after the end of the age of tourism.

    Community building is probably the most important prepper skill of them all.

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