Category: Peak Oil

Peak oil has been predicted since the 1950s to occur by various near-future dates, originally as early as 1965. The prediction that US oil production would peak in the 1970s was, in fact, accurate, but new discoveries – including North American sources involving fracking and tar sands – keep pushing the timeline outward. Some say we will always find new oil sources, though economic theory states they will also get inexorably more expensive. Recent discussions have revived the peak oil debate. A Business Insider articl e last spring claimed “it is probably safe to say we have slayed "peak oil" once and for all, thanks to the combination new shale oil and gas production techniques and declining fuel use.” It was counterpointed here . But I basically don’t care. All the talk of peak oil, that we are running out of fossil fuels and therefore need […]

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Earth insight badge An oil refinery in Canada An oil refinery in Canada. Has cheap oil gone forever? Photograph: Dave Reede/All Canada Photos/Corbis A conference sponsored by a US military official convened experts in Washington DC and London warning that continued dependence on fossil fuels puts the world at risk of an unprecedented energy crunch that could inflame financial crisis and exacerbate dangerous climate change . The ‘ Transatlantic Energy Security Dialogue ‘, which took place on 10th December last year, was co-organised by a US Army official, Lieutenant Colonel Daniel L. Davis, in association with former petroleum geologist Jeremy Leggett, chairman of the UK Industry Taskforce on Peak Oil and Gas . Participants, who addressed one another via video link, consisted of retired military officers, security experts, senior industry executives, and politicians from the main parties – including two former UK ministers. According to US Army colonel Daniel […]

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Page added on January 15, 2014 We have all heard of peak oil, but peak grains? A study released by the Institute of Agriculture and Natural Resources at the University of Nebraska-Lincoln suggests we may be heading in that direction — if we’re not already there. The UNL study indicates that about 30% of major global cereal crops — including rice, wheat and corn — may have already reached their maximum yields. In fact, yields of these crops seem to have already hit a plateau and some are already decreasing, especially in eastern Asia, Europe and the United States. “We found widespread deceleration in the relative rate of increase of average yields of the major cereal crops during the 1990-2010 period in countries with greatest production of these crops,” says an article based on the study in Nature Communications . The article notes that there was a noticeable plateau […]

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Page added on January 16, 2014 OPEC spare capacity set to reach levels last seen in the depths of the financial crisis in 2009, analysts say One piece of the jigsaw puzzle is missing to complete the deflation landscape across the West: a slide in oil prices. This is becoming more likely each month. Turmoil across the Middle East and parts of Africa has choked supply over the past two years, keeping Brent crude near $110 a barrel despite a broader commodity slump. Cotton and corn prices have halved, as has the UBS (Xetra: UB0BL6 – news ) index of industrial metals. Such anomalies rarely last. “We estimate that crude oil is now the mostly richly priced commodity in the world,” says Deutsche Bank (Xetra: DBK.DE – news ) in a fresh report. Michael Lewis, the bank’s commodity strategist, said markets face an “new oil supply glut” as three […]

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As I mentioned in the first post of this short series, we are once again being subjected to differing interpretations of the same set of facts. It does make planning and strategizing a bit more challenging…. YES? NO? UP? DOWN? LEFT? RIGHT? Global oil demand will expand by 14 million barrels to average 101 million a day in 2035, according to the IEA report. The share of conventional crude will drop to 65 million barrels by the end of the period because of growth in unconventional supplies, the IEA said without providing current data. [1] How much of the decline in crude production has been counterbalanced by the new US shale oil production to date? The answer is barely 2 million barrels per day — which required more than half the world’s oil rigs outside Russia and China to produce. Worse, detailed studies […]

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BP PLC’s Energy Outlook 2035, released Jan. 15, forecasts that world energy consumption will increase 41% between 2012 and 2035. Countries outside of the Organization for Economic Cooperation and Development, especially China and India, are believed to contribute to virtually all of this growth. Global energy intensity in 2035 is 36% lower than what it was in 2012, while energy per capita use will increase by 14%. According to the outlook, all fuels experience growth, with the fastest in renewables (+6.4% p.a.). By 2035, 14% of world electricity is from renewable sources, up from just 5% in 2012. Among fossil fuels, natural gas is fastest (+1.9% p.a.), followed by coal (+1.1% p.a.) and oil (+0.8% p.a.). Out to 2035, more than a third of global liquids will be supplied by the US, Russia, and Saudi Arabia. Natural gas supplies will reach nearly 500 bcfd by 2035, of which 20% […]

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Normally I would have had this out two weeks ago, but the 60 Minutes story has thrown me behind schedule. I continue to get lots of comments and questions about Vinod Khosla and now his righteous indignation over how the 60 Minutes story was portrayed (especially since that was the only part of my interview they aired), so I may follow up in a week or so to explain (once more) the precise nature of my criticism — as well as what it isn’t. To be honest, I am tired of writing about it, and I am sure that regular readers are tired of reading about it, but new readers continue to ask questions that indicate they misunderstand the nature of my criticism. In the meantime, here is my report card for my predictions from last year. In the next article, I will […]

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Why EIA, IEA, and Randers’ 2052 Energy Forecasts are Wrong Page added on January 14, 2014 What is correct way to model the future course of energy and the economy? There are clearly huge amounts of oil, coal, and natural gas in the ground.  With different approaches, researchers can obtain vastly different indications. I will show that the real issue is most researchers are modeling the wrong limit . Most researchers assume that the limit that they should be concerned with is the amount of oil, coal, and natural gas in the ground. This is the wrong limit . While in theory we will eventually hit this limit, because of the way fossil fuels are integrated into the rest of the economy, we hit financial limits much earlier . These financial limits include lack of investment capital, inability of governments to collect enough taxes to fund their programs, and […]

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Jeremy Leggett column in Recharge magazine : “We are betting our entire national economic life on the hope — indeed the expectation — that the fracking boom will continue until well into the 2020s, and that, at a rate and cost we desire, significant amounts of ‘yet to be discovered’ oil will somehow be found to meet the demand.” “If any of that proves incorrect, we have no plan, no alternative, and have given no thought to how we would respond in such a case.”The speaker is national-security expert Lieutenant Colonel Daniel Davis, a veteran of four tours of duty with the US Army in Iraq and Afghanistan. I am not a military man, but I worry just as much about the energy security of my own country as he does about his. In the UK, the government, the civil service and most of the big energy companies seem […]

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The fear that we have reached peak oil seems to have abated in recent years as the US and other countries began extraction of shale oil. But that doesn’t mean we should think that this problem has gone away. According to UPI.com , new research published by the Royal Society’s Philosophical Transactions A suggests that the shale gas reserves are just a false dawn and that oil production has reached a terminal tailspin, as supply increasingly struggles to keep up with demand. Oil rig with gas flare: we’ve already passed peak oil according to new research The impact of this will be felt by economies all around the world, resulting to exploiting ever-more difficult to extract oil supplies in an attempt to prop up supply. Former BP Geologist and co-author of the new research paper, Dr Richard G Miller told students at the University College London that data from […]

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