Thursday, November 16, 2006

Peak oil? Not yet.

Bad news for doomsayers who suggest "the Earth may have already reached peak oil production or that this point is very near": Peak Oil is not yet upon us.

The Nostradamus-like pronouncement made fifty years ago by American geophysicist MK Hubbert and religiously trotted out when oil prices rise is given short shrift in a report by oil analysts Cambridge Energy Research (founded by Daniel Yergin, who won a Pulitzer Prize for his 1991 oil industry history The Prize, and who famously noted, "This is the fifth time we've run out of oil since the 1880s"), which estimates "remaining global supply at 3.74 trillion barrels, compared with 1.2 trillion estimated by "peak oil" theorists... CERA finds that not only will world oil production not peak before 2030, but that the idea of a peak is itself "a dramatic but highly questionable image"."
"World oil production will not begin to fall for at least another 24 years, contrary to doomsday theories that supply is already in terminal decline, a prominent energy consulting group said Tuesday.

"Cambridge Energy Research Associates said in a report that the world has some 3.74 trillion barrels of oil left -- enough to last 122 years at current consumption rates and triple the amount estimated by 'peak oil' theorists...

“'Oil is too critical to the global economy to allow fear to replace careful analysis about the very real challenges with delivering liquid fuels to meet the needs of growing economies,' said Peter Jackson, director of oil industry activity for Cambridge, a Massachusetts-based consultant to the oil, natural gas and electric power industries.

"They said the peak in global daily oil production will not come before 2030 and will be followed not by a steep decline, but rather by an 'undulating plateau' of ups and downs in output before a gradual dropoff, according to the report.

"Jackson said the main flaw in 'peak oil' theory is that it fails to account for exploration, technology, rising estimates of the size of existing fields and geopolitical shifts...
Are you listening, Jeanette? As George Reisman has pointed out (and as we've discussed recently), resource use is a dynamic process, not a static one, with the ultimate resource being the mind applied to things that nature offers us. Making doomsday predictions on resource use without factoring in the role of the mind in resource production is itself doomed to failure.

NB: You can see a short video of author and Canbridge Energy Research founder Daniel Yergin discussing the report at the MSNBC site. The clip is at the right of the page. "The theory [of Peak Oil] is very fashionable ... but it completely discounts technology, which constantly expands our horizons..." he says.

LINKS: CERA says peak oil theory faulty - Energy Bulletin
World oil supply still plentiful, study shows - MSNBC
Environmentalism refuted - George Reisman, Mises Institute
More sustainability - Not PC (October, 2006)
Review of Andrew Bernstein's Capitalist Manifesto - Le Quebecois Libre

RELATED: Politics-World, Economics, Environment, Conservation, Urban Design, Politics, Politics-Greens, Ethics

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4 Comments:

Anonymous Anonymous said...

Oh no, not peak oil……again! We've been running out of oil in 40 years for the last 150.

Peakism is a near religion with the usual range from mildly concerned greens to survivalist ethnic cleansers dreaming of the cleaning out of the gene pool (weirdly they don’t seem to realise their own genes are probably the most cleanseworthy). It focuses on a single point in time when the rapture will come and like the JWs and other second coming types they ignore the continuing false predictions with near blind faith. They should be rightly derided and then ignored but then 'the world won't end tomorrow' makes such boring copy.

Insider

11/16/2006 11:18:00 am  
Blogger Kane Bunce said...

Oh geez no surprise thet ha PC? As anonymous said we've been "running out" of oil for a very long time. The alarmists often forget that we always invent new ways to lower oil use in cars, etc. I have yet to see a report from the alarmists that takes into account such technologies, such as hybrid cars. Such people, like the enviromentalists aren't really interested in human life. They are in fact, anti-life of all sorts.

11/16/2006 03:26:00 pm  
Anonymous Anonymous said...

I see there is a looming shortage of fuirt and veges according to ZB. Who'd have believed Peak Asparagus would happen in our lifetime?

Insider

11/16/2006 04:18:00 pm  
Anonymous Anonymous said...

Gee guys.
You must be right.
The oil pools extend from below ground to infinity and beyond. And yes, the human mind is so filled with ingenuity that we have already achieved commercially viable hot fusion, cold fusion, the cures to all cancers, we have won the wars on drugs, and everyone is zipping around town in one of those flying cars like on that cartoon, the Jetsons. Yabba dabba doo. We are smart. They are dumb ass crazy. And that's that.

11/17/2006 09:58:00 pm  

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