Peak oil status

In his agenda John Baez wrote:

"Energy and the Environment: What Physicists Can Do”. This means writing a new talk!

I haven't followed the energy subject closely, but my impression was that, compared to two years ago when Azimuth started, there haven been some announcements about the discovery of extra oil fields, and not just from tar sands, new technolgies and the USA maybe taking over Saudi Arabia's position in the future, etc. I don't know enough to judge how much is true and how much is advertisement, but at least I had the impression that the occurrence of peak oil would be shifted with some decade.

Does somebody know more about this?


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    edited January 2013

    I try to follow Peak Oil (and wrote most of what little is there on Azimuth; unfortunately, Christmas period notwithstanding, I don't currently have enough consistent internet access to do the detailed checking to work more on the article ATM).

    Firstly, it is in the interests of oil companies to be present things to their advantage. For example, in "all liquids fuels" figures things are aggregated by liquid volume even though the energy per unit liquid volume of types of fuel (oil, ethanol, etc) varies a bit. (I actually don't know how the users of oil such as cars work in detail: is it actually the case that to go at a certain speed for a certain time a fixed volume that gets used by the engine regardless of energy content?)

    Secondly, there's the issue of projections: the quickest illustrative example I can find is Iraq. Due to sanctions, various governments pre and post invasion, etc, etc, Iraqi production is way below both 1980s levels and what "the geology could allow". Here's a quote from an article in the Washington Post probably originally written in 2006

    Those figures suggest misplaced optimism by Iraq's oil ministry, which in 2005 predicted crude production would reach 2.5 million or even 3 million barrels a day by the end of 2006.

    AFAICS the latest figures for Iraq in the middle of 2012 are it had only just exceeded 3 million barrels. Now it's obviously the case that there's lots of stuff been happening in Iraq which would cause problems with projections, but there's stuff (both political and geophysical) going on everywhere all the time.

    All the reports I've seen about how "peak oil has been averted" are along the lines of "we've found/figured out how to extract source X, if things go as we predict then in 5 years time things will be dramatically different". There are various arguments about where these may be wrong in individual cases (eg, the amount of oil extracted from shale initially starts high then drops low much quicker than historical fields which isn't being accounted for) but for me the bottom line is:

    1. It certainly looks like the world is pretty much at an oil production plateau which is only not more obvious because economic conditions suppressing potential users of oil.

    2. There are projections that various things will mean that there will be much more oil available in 5-10 years with the claim "so even if there is a problem now it's only transitory". These are projections in the same way that stock market projections are rather than projections of, say, solar output over the next 10 years. In the later case we know enough about the situation to make a good projection and reliably estimate its error bars. In contrast we don't yet have enough knowledge to know which stock market predictions are using the right factors with the right weightings, let alone how accurate they'll be.

    Caveat: I've spent the last 6 years expecting petrol to get sufficiently expensive that using a car would be uneconomical and so have avoided buying one. While it's got more expensive, it's still less expensive than the alternatives and my life would be easier if I had got one. So that's a verdict on my skill at prediction.

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    There's a survery of various historical trend data in oil up to recent times here. Whether new sources/technologies have genuinely changed things is a more complicated issue I don't really have confidence in understanding (or indeed that anyone properly understands yet!), so I won't go into more detail about that.

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    Hi David,

    thanks for your comments! I took a look at the link (what's clear to my untrained eye is a declining production in Europa and the civil war in Libya) and I remembered that this report was in the news some time ago

    I haven't read it, but I would expect that they are more neutral than oil companies.

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    Lorenz Borsche, an old-timer from sci.physics, has joined the Azimuth Forum and wants to write some blog articles, perhaps including one on peak oil. I hope he does! We need to talk about this more on Azimuth, and I'm scared to, because I feel I don't understand enough. It's fine if different people say different somewhat conflicting things as long as we all try seek understanding.

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    Excellent: I think peak oil is very important but just haven't been able to spend time on it. Getting blog article will be great.

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    I think part of the problem with Peak Oil has been applying the behavior of American oil production to the world. In America, we expanded oil production fairly quickly, and by the late 60s/early 70s, had exploited all of the easily available oil. Other countries otoh, still had easily accessible reserves, so while American oil production declined because the price of oil didn't support continued extraction, this wasn't some function of geology, but instead of a function of the oil markets.

    Currently, there is no untapped low cost alternative to world oil, so instead of seeing stable prices and the same Hubbert Peak, we'll likely see rising prices and a long plateau. Other factors that contribute to this plateau are increased efficiency of use (higher fuel economy in cars) and higher than anticipated PEDs (price elasticities of demand) in OECD countries. The refinery problems in the US were a great example of this. Higher gas prices actually put a substantial dent in petroleum prices because consumers cut back significantly on top of the reduction in refinery throughput.

    Oil's use as various fuels also helps out with stable production because we can generally substitute any hybrocarbon for light sweet crude, and still get gas, diesel, kerosene, and so on. This is why oil refinery output can remain consistent even while crude output can decline, usually due to substituting NGLs for crude. Biofuels can also substitute for refinery products, but they're usually too expensive to bother with unless we have some kind of mandate specifying their use.

    The only things I can think of that would result in a Hubbert curve with world production are lower cost alternatives (EVs, which may happen over the next decade or two), world wide consensus on limiting GHG emissions (Less likely than EVs), or an extremely large recession.
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    I hope you folks interested in peak oil go here and help improve Lorenz Borsche's proposed blog article!

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