Category: Peak Oil

There may never be a ‘shock moment’ of peak oil’s arrival; instead, peak oil may continue to play out as a gradual, unplanned transition to a new set of energy and consumption patterns that are less oil dependent, giving rise to social, economic, and ecological impacts that no one can predict with any certainty. [1] A key focus among the several hundred blog posts here has been my expression of concern that we’ve done almost no planning and very little preparation to deal with the consequences and challenges of peak oil. As Dr. Samuel Alexander noted in another of his well-considered reports on the topic, we’re not all going to awaken one morning to the Breaking News that peak oil has arrived. There will be several reasons for the absence of that advisory, not the least of which is that peak oil—insofar as conventional crude oil production is concerned […]

Click here to view full article at peakoil.com

Robert Gordon has painted a dark picture of the world’s long-run economic growth prospects. But if the past is any guide, he will likely join the band of earlier distinguished economists who proved to be far too pessimistic about the human capacity to innovate. Dennis Robertson, the renowned Cambridge economist and a contemporary of John Maynard Keynes, famously remarked that economic fashion was like going to the greyhound races. If one stood still long enough, the dogs would come around one more time. This certainly seems to be the case with fashions in economic pessimism about the long-term economic growth prospects of the world’s advanced industrial economies. Each time these economies stumble, there is no shortage of economists who come out of the woodwork to advance plausible reasons as to why the limits of economic growth might have been reached. Yet each time, events seem to have proved these […]

Click here to view full article at peakoil.com

Until Colin J. Campbell and Jean H. Laherrère published their paper The End of Cheap Oil in 1998 (Campbell & Laherrére, 1998), the petroleum geologist Marion King Hubbert (1903 – 1989) was all but forgotten, including his correct forecast – back in 1956 – of the US’s peak of oil production in 1970 (Hubbert, 1956). In their paper Campbell and Laherrère warned that: “Barring a global recession, it seems most likely that world production of conventional oil will peak during the first decade of the 21st century.” It took another 12 years, but eventually the oil production optimist par excellence, the International Energy Agency (IEA, of the OECD countries), also had to admit the undeniable in their World Energy Outlook of 2010 (IEA, 2010): “Crude oil output reaches an undulating plateau of around 68–69 mb/d by 2020, but never regains its all‐time peak of 70 mb/d reached in 2006, […]

Click here to view full article at peakoil.com

Waiting for Godot was a two act play by Samuel Beckett where two men kept waiting for Godot and they just kept waiting and waiting and waiting… And no, I don’t think we will be kept waiting and waiting like the characters in that play. Peak oil is about to arrive, in my opinion anyway. Way back in 2005 we thought it likely that crude oil production had peaked at just under 74 million barrels per day. During the preceding three years C+C production had risen by 6,481,000 barrels per day or 2,160,333 barrels per day per year. The reason for that dramatic increase was a doubling in the price of oil from $25 per barrel in 2002 to $54.43 in 2005. So oil production depends, to a great extent, the price of oil. The more money the more oil. However…  The C+C data in all charts below are […]

Click here to view full article at peakoilbarrel.com

Yes, we see 10 early warnings that Big Oil stocks are going to trigger an economic collapse by 2020, maybe 50% as gas prices go through your SUV’s sunroof. A contrarian view? Yes, pump prices already shot up 11% this year. Plus Big Oil cherishes its new role as exporter: Bloomberg’s even predicting the U.S. will “surpass Russia and Saudi Arabia as the world’s top oil producer by 2015, and be close to energy self-sufficiency in the next two decades, amid booming output.” So why worry? Why contrarian? Because a decade ago the Bush Pentagon predicted that by 2020 “an ancient pattern of desperate, all-out wars over food, water, and energy supplies would emerge” as global “warfare is defining human life.” But, that’s light years away in today’s twitter-brain world where today’s news is so bullish: “100% of economists think yields will rise within six months,” no recession in […]

Click here to view full article at peakoil.com

With 2013 in the rearview mirror, peak oil is beginning to create big problems for big oil. Free cash flow is like the canary in the coal mine. Earnings can be massaged with accounting magic, but it is more difficult to massage free cash flow. Total (NYSE: TOT ), along with its fellow big oil brethren, has seen its free cash flow fall significantly in 2013. Now is the time to examine the fundamentals and see just what sort of unique risks and challenges big oil faces. Oil prices are stable, but free cash flow is falling TOT Free Cash Flow (TTM) data by YCharts Sometimes, falling free cash flow is a short-term issue. Such was the case after the 2008 oil crash. Oil prices fell, and as a result free cash flow fell as well. The current downturn is different. Oil prices have remained relatively stable and yet free […]

Click here to view full article at peakoil.com

A new multi-disciplinary study led by the University of Maryland calls for immediate action by government, private and commercial sectors to reduce vulnerability to the imminent threat of global peak oil , which could put the entire US economy and other major industrial economies at risk. The peer-reviewed study contradicts the recent claims within the oil industry that peak oil has been indefinitely offset by shale gas and other unconventional oil and gas resources. A report by the World Energy Council (WEC) last month, for instance, stated that peak oil was unlikely to be realised within the next forty years at least. This is due to global reserves being 25 per cent higher than in 1993. According to the WEC report, 80% of global energy is currently produced by either oil, gas or coal, a situation which is likely to continue for the foreseeable future. The new University of […]

Click here to view full article at www.theguardian.com

Over the next decade and a half, 2.5 billion people in China, India and other developing countries will join the global middle class. They are going to need skyscrapers to live in and superstores to shop in. They are going to want smartphones, cars, flank steaks, air conditioning, pet clothing, Disneyland vacations, and probably some throw pillows. How is a planet already straining under the pressure of today’s 2 billion middle class consumers going to accommodate 2.5 billion additional ones? For many observers, this unprecedented economic growth foretells a Malthusian meltdown. In this scenario, skyrocketing demand for scarce natural resources will lead to unchecked carbon emissions, water wars, massive deforestation, $100 Big Macs for the rich and cricket-meat Bug Macs for everyone else. McKinsey director Matt Rogers and Stanford professor Stefan Heck have a more optimistic take on the future. In their compelling new book, Resource Revolution , they […]

Click here to view full article at www.huffingtonpost.com

Researchers from the University of Maryland and a leading university in Spain demonstrate in a new study which sectors could put the entire U.S. economy at risk when global oil production peaks (“Peak Oil”). This multi-disciplinary team recommends immediate action by government, private and commercial sectors to reduce the vulnerability of these sectors. While critics of Peak Oil studies declare that the world has more than enough oil to maintain current national and global standards, these UMD-led researchers say Peak Oil is imminent, if not already here—and is a real threat to national and global economies. Their study is among the first to outline a way of assessing the vulnerabilities of specific economic sectors to this threat, and to identify focal points for action that could strengthen the U.S. economy and make it less vulnerable to disasters. Their work, “Economic Vulnerability to Peak Oil,” appears in Global Environmental Change […]

Click here to view full article at peakoil.com

There has been considerable debate lately on what effect the supply and price of oil is having on the economy. It is, to my mind, a lot more serious than the vast majority of economists believe. In fact one can just look at what is happening today to see the effect of a constrained oil supply and high oil prices. Just look at the unemployment rate: Real unemployment is double what it was in 2007. And it is creeping higher. If you have not watched Oil Supply and Demand Forecasting with Steven Kopits   then you have missed the best and most informative video that has come along since this whole debate started over a decade ago. I have just finished watching it for the third time. This time I made notes. Kopits makes it very clear that oil is a binding constraint on economic growth. Of course that […]

Click here to view full article at peakoil.com