Putting Peak Oil in its place

March 6, 2007 5:29 AM

Peak Oil no more?Prophets of peak oil are being proven wrong as new technologies increase oil recovery rates. In fact, the entire peak oil theory might be based on flawed assumptions.
posted by blahblahblah (94 comments total)

Response to CERA's analysis from supporters of peak oil.
posted by blahblahblah at 5:29 AM on March 6, 2007

Flawed assumption #1: The Earth is of finite size
Flawed assumption #2: When you burn oil once, you can't burn it again
Flawed assumption #3: Easter Bunny does not exist
posted by DU at 5:34 AM on March 6, 2007 [13 favorites has favorites]

All this means is that will be difficult to predict the exact year when we hit peak oil. And that that year might possibly be sometime later in the century than initial peak oil forecasts believed.

CERA's estimates also do not include the effects of rising prices for new extraction technologies -- which admittedly may actually extend the peak oil curve a bit.

All this means is that we have a few more years to refine our use of other energy sources before the hammer drops.
posted by xthlc at 5:42 AM on March 6, 2007 [3 favorites has favorites]

I should clarify: "peak oil" depends on there being a sharp and prolonged decline in oil production after the peak is reached, which is generally assumed to be around now. This creates competition for ever-dwindling resources leading to rapid price increases, resource wars, and so forth.

To say that the assumptions are flawed does not mean that oil will never run out, it means that we are not headed for a sharp decline, but rather a levelling out of production that is more sustainable; it also means that oil production may continue to increase for some decades to come. This will hopefully give us enough time for markets and policy makers to assist in the switch to new energy sources, without everyone needing to die horribly as society collapses.
posted by blahblahblah at 5:43 AM on March 6, 2007 [3 favorites has favorites]

This is great news, now there isn't even a natuarl definite end to our carbon spewing ways.

*goes to photograph the snow to remember what it looks like.*
posted by Space Coyote at 5:46 AM on March 6, 2007

It's worthwhile to note that CERA is composed of energy industry experts consulting to the energy industry, financial industry, governments, and institutions. It would be an understatement to say that they have an interest in the maintenace in a petroleum-dependent economy.

DU, you can add this chestnut as #4: World oil capacity will continue to grow with demand as a result of technological innovation.
posted by rzklkng at 5:47 AM on March 6, 2007 [1 favorite has favorites]

Burn it if you got it, right?
posted by Drexen at 5:50 AM on March 6, 2007

...a levelling out of production that is more sustainable...

Headline: Burning Fossil Fuels Now .03% Less Stupid

There are so many things wrong with this sentence fragment that I don't even know where to start. How about that a levelled out production is a decrease per capita? How about that dumping CO2 into the atmosphere at the "levelled out" rate we are doing it, is not really "more sustainable" in any practical sense than increasing it? How about that the issue with switching to new energy sources isn't a lack of time but a lack of will?
posted by DU at 5:52 AM on March 6, 2007 [1 favorite has favorites]

I read the now extinct Easter Island inhabitants had a similar "peak trees" argument.
posted by Mr_Zero at 5:52 AM on March 6, 2007 [11 favorites has favorites]

Yep. Wife wants to have kids, but from a cost/benefit analysis, I'd really only get a few years out of 'em before they died from all this crap. I guess I should just save the money I'd spend on them and buy more gasoline and Motocross tickets.
posted by mr_book at 5:57 AM on March 6, 2007

Except you forget, Mr_Zero, that trees are indeed renewable.
posted by Cyclopsis Raptor at 5:59 AM on March 6, 2007

Good news! We're not going to run out of clean drinking water. Ever.

That last litre is just going to be reaaaally expensive.
posted by dreamsign at 6:01 AM on March 6, 2007 [4 favorites has favorites]

I read the now extinct Easter Island inhabitants

Common misconception. Their population crashed dramatically, but they are not extinct.
posted by Flunkie at 6:02 AM on March 6, 2007

higher oil prices have made it economical for companies to go after reserves that are harder to reach.

But, it's not economical to research alternative fuels?
posted by rabbitsnake at 6:05 AM on March 6, 2007

> I read the now extinct Easter Island inhabitants had a similar "peak trees" argument.

If we solve the demand problem the way the Easter Islanders did, that's fine with me. I want peak oil to be true. The obvious difference between us and the EI indigenes is that it's easy to inventory your remaining tree supply but hard to inventory your remaining extractable hydrocarbon supply. Certainly oil (and the other burnable things) will run out someday -- no game goes on forever. But nobody really has a clue when this will happen. It could start next year, it could wait until 2067.
posted by jfuller at 6:05 AM on March 6, 2007 [1 favorite has favorites]

So we're sitting on a high-up tree branch sawing through the branch between ourselves and the tree, but the good news is that we're not sawing as quite quickly as we thought we were? On account of this it's safe to go on sawing?
posted by Grangousier at 6:06 AM on March 6, 2007 [1 favorite has favorites]

How about that a levelled out production is a decrease per capita? How about that dumping CO2 into the atmosphere at the "levelled out" rate we are doing it, is not really "more sustainable" in any practical sense than increasing it? How about that the issue with switching to new energy sources isn't a lack of time but a lack of will?

Yes, yes this is all true. Peak Oil, as its proponents describe it, would end CO2 emmissions... because the entire world would be destroyed in endless wars and economic collapse. I prefer to address the real global warming crisis without the doomsday predicted by Peak Oil. And yes, a levelling off of production would lead to a gradual increase in price, which would make alternative energies more economically efficient, but, again, Peak Oil theories demand that the price increase would be a sudden rapid shock, which, again, would be worth avoiding.

Saying that we are not going to suddenly run out of oil in the next few years is a GOOD THING. Peak Oil predicted such a sudden crash that we were already doomed, with no time to shift to alternative fuels. It doesn't mean we shouldn't switch to other energy sources, it doesn't excuse global warming, but it is good that the gloom-and-doom economic collapses predicted by many won't be happening.
posted by blahblahblah at 6:06 AM on March 6, 2007

Saying that we are not going to suddenly run out of oil in the next few years is a GOOD THING.

I would say the *fact* (if true) that we won't suddenly run out of oil is a good thing, because we can avoid the wars and such-like. But *saying* we are not going to suddenly run out is probably a bad thing, since everyone then goes back to sleep until we really ARE going to run out.

Basically, I'm advocating leaving our hair on fire until we have the real problem solved, not kicking the can 20 years down the road on the basis of hopeful thinking from oil money.
posted by DU at 6:11 AM on March 6, 2007

CERA have been peddling this line for ages. As peak oil theorists have always said, no-one's expecting a smooth price line upwards, because oil is so intimately associated with political disruption.

There's also a direct link between temporary price cooling and the amount of attention paid to CERA. Just as the serious spikes we see get associated with interest in ASPO.

Bottom line, we're currently burning four barrels of oil for every one barrel we discover. It's almost over. The fat lady may take a year or two more to start singing, that's all.
posted by imperium at 6:12 AM on March 6, 2007

Big Profits, Big Worries in Oil Fields
New York Times, March 3, 2007

http://www.willyoujoinus.com/
Chevron Corporation
posted by cenoxo at 6:18 AM on March 6, 2007

The idea that peak oil isn't a problem because scarcity increases the price of oil which makes fishing for more difficult reserves profitable for oil companies cracks me up.
posted by mediareport at 6:18 AM on March 6, 2007 [1 favorite has favorites]

Even if the amount of oil extracted from the earth remains stable, the demand from China (and soon India) isn't.
posted by PenDevil at 6:26 AM on March 6, 2007 [3 favorites has favorites]

Look, nothing you can do can change the amount of oil in the ground. Still, if this technology works as well in every oil field, it could mean pushing the true peak back a hundred years or more. That would be good in some ways, I guess.

But, I was kind of hoping that Peak oil would come and cancel out global warming :P. Obviously we can't burn oil we don't have.
posted by delmoi at 6:28 AM on March 6, 2007

A classic misunderstanding from a Chevron engineer in yesterday's NYT: “That’s why peak oil is a moving target,” Mr. Hatlen said. “Oil is always a function of price and technology.” (last line of page 2)

The oil industry is affected by price and technology, sure, but geology will always be a limiting factor. We aren't making any more of this stuff, no matter what the price or the drilling technology.
posted by imperium at 6:30 AM on March 6, 2007

Peak Oil predicted such a sudden crash that we were already doomed, with no time to shift to alternative fuels.

Actually, the Hubbert Peak theory talks about oil production being a bell curve, not a precipitous drop.

Peak Oil, as its proponents describe it, would end CO2 emmissions... because the entire world would be destroyed in endless wars and economic collapse.

I've always thought that peak oil would lead to fewer wars, as we'd no longer be fighting endless, bloody wars over a few thousand square kilometers of oil-soaked soil, like we are now.

Anyway, in the 30's, some people were worried that Peak Coal would bring about the collapse of civilization. It was much scarier then, because we didn't have solar, or nuclear, or much effective hydro or wind power. It turned out that "better" (if you can call removing entire mountains "better") extraction methods pushed that curve so far off that we can hardly see it anymore. So I see your point: the peak may not have actually hit yet. The thing is, peak oil is a great lever to get those who profit from the status quo to finally get cracking on alternate sources of power. Stuff like this makes it more difficult for us to light a fire under their metaphorical asses.

(or, on preview, what a bunch of other folks are saying.)

(Also: "Proponents" of peak oil? That's a strange word to use. Are people who warn about the explosive spread of HIV in Africa "proponents" of HIV?)
posted by phooky at 6:32 AM on March 6, 2007 [1 favorite has favorites]

Peak Oil, as its proponents describe it, would end CO2 emmissions... because the entire world would be destroyed in endless wars and economic collapse.

Just curious, but what happens if peak oil does come suddenly (due to overestimates of reserves remaining, or understimates of cost of extraction).

How difficult does it then become to research, test, and then implement alternative energy regimes without that precious black stuff to run the production line? Assuming we sit our asses and do nothing about the situation until then.
posted by dreamsign at 6:34 AM on March 6, 2007

China about to pass U.S. as world's top generator of greenhouse gases
San Francisco Chronicle, March 5, 2007
posted by cenoxo at 6:39 AM on March 6, 2007

Idiots.

Peak oil is not running out of oil.

Peak oil is running out of fast oil.

Yes, oil that wasn't economical to extract at $20/bbl might be at $50/bbl. But guess what? That means we're paying $50/bbl for it.

The worst news out there is Saudi Arabia. Saudi Aramaco's production has dropped by 8% over the last year, *despite* driling tripling. Officially, SA says this is because they're holding back production to build a reserve.

So. The possible good news is that Saudi Arabia will strengthen the lock it has on oil prices. The assumption there is that SA considers having a 2-3mbbl/day production reserve so important that it is willing to drill like mad, yet not bring those wells online.

That's what they say. If they aren't lying, that's the upside -- that SA will further control the leverage it has on the world by controlling oil prices, since they -- and only they, everyone else is running flat out -- will say what we pay for oil.

What's the other side? The other side of the coin is that they're lying about the reserve. The reason the production is dropping is that Gawahar's is failing, and the reason for the mad amount of drilling is to try to keep the production up.

We're losing all the big fields -- esp. the ones on this side of the world. Cantarell in Mexico has dropped from 2Mbbl/day to 1.5Mbbl/day, and is falling. This means we need that Saudi oil even more. Worse, what's replacing Cantarell takes much more effort to pump.

That's peak oil. It's not so much finding it as it is getting it out fast enough. Tar sands don't help -- the energy and transport issues limit Atabasca, at full bore, to about 350,000bbl/day. That's not going to replace Prudhoe Bay, much less the Saudi Fields.

It's not just the extraction costs, it's extraction rates. It doesn't matter if Atabasca and Orinco extraction costs drop to 50 cents a barrel. They can never replace Cantarell, which alone, in the current depleted state, pumps twice the crude a day that both Atabasaca and Orinoco could ever do. They are nothing -- nothing at all -- compared to Gawahar.

If extraction is free, but you only get 30% of the oil you use out per day, the price will skyrocket, and even if you do match the supply and demand curves, that means that 70% of your former oil using market has been priced out of oil. They get none.

That's peak oil.
posted by eriko at 6:39 AM on March 6, 2007 [23 favorites has favorites]

I always love the "maybe X environmental threat isn't true, let's party!" approach. Given that we have precisely one (1) planet, this means we have exactly one (1) chance to get it right. Erring on the side of caution seems not entirely unwise.
posted by adipocere at 6:41 AM on March 6, 2007 [2 favorites has favorites]

There's a lot of expensive oil (Alberta oils sands for example); what's running out is oil that's cheap to extract with old technology. Yergin leans right.
posted by lw at 6:44 AM on March 6, 2007

I've been waiting for someone to come along and tell me I don't have to worry about this stuff anymore. Thanks, CERA! That's a load off my mind!
posted by The Card Cheat at 6:47 AM on March 6, 2007

this book was an interesting rebuttal of the peak oil theory ... not sure i buy it, but if anyone's read it, they're welcome to say why they think this guy is wrong

(by the way, saying that he works in the oil industry is not a sufficient counter argument)
posted by pyramid termite at 6:48 AM on March 6, 2007

A front-page article yesterday about technology advances that made it possible to unlock more oil from old fields misstated Saudi Arabia’s total reserves

What's new. Saudi Arabia routinely misstates its total oil reserves, as do all of OPEC, I expect.

I believe in the theory behind 'peak oil' but have always balked at those willing to provide time-scales for its tipping point. Misstatements of reserves, the technology drive by the oil companies and new frontiers being explored (good luck Alaska) are vagaries that leave such estimates worthless.

Those seeking to dismiss the theory of peak oil have the same uneasy foundation of dodgy figures as those promoting it. Of course, figures aren't needed to know that the oil will run out, eventually.

I reckon we will have oil for a long time yet, as long as we have the coal power to extract/refine it. Dirty.
posted by Shave at 6:51 AM on March 6, 2007

Peak Oil, as its proponents describe it, would end CO2 emmissions... because the entire world would be destroyed in endless wars and economic collapse.

That's a pretty bizzare way of putting it. I mean, it would end CO2 emmissions because there would be nothing to burn. No one is saying it would lead to "endless wars" or economic collapse.

They're essentially arguing against a straw-man.
posted by delmoi at 6:55 AM on March 6, 2007

Who paid for this posting? Big Oil?
posted by homodigitalis at 6:57 AM on March 6, 2007

No one is saying it would lead to "endless wars" or economic collapse.

My ex-boyfriend was. Now I can talk to him about the future of the world without everything being answered by "well, maybe that would happen if civilization didn't collapse after peak oil".
posted by Tlogmer at 6:57 AM on March 6, 2007

This creates competition for ever-dwindling resources leading to rapid price increases, resource wars, and so forth.


There is a resource war going on right now. Do I really have to point this out?
posted by srboisvert at 6:58 AM on March 6, 2007 [1 favorite has favorites]

Okay, I should have read the whole thread, I thought the quote was from one of the links, not a comment.

blahblahblah: no one at least not anyone credible is claiming that Oil production will "drop sharply" what they are saying is that Oil production will, at some point "peak" and after that it will decline slowly, probably over hundreds of years. At least about as slowly as oil production declined. here is a graph of world oil production. Look at Texas at the bottom, you can see that Oil production increased steadily, then started decreasing at the same rate. You can see the same for the USA as a whole. This happened in the 1970s.

I mean, this is the definition of a straw-man argument.
posted by delmoi at 7:08 AM on March 6, 2007

Except you forget, Mr_Zero, that trees are indeed renewable.

So is oil, over millions of years. The point is that Easter Island inhabitants used the trees faster than they were replenished. Take a look at the island now. There is nothing left on it but grass and stone heads. In desperation to survive they consumed everything. I think there are only insects left now, but I can not find a reference.
posted by Mr_Zero at 7:11 AM on March 6, 2007

If we solve the demand problem the way the Easter Islanders did, that's fine with me.

Er, didn't they descend into war and cannibalism and wipe out almost the entirety of their population? No thanks!
posted by Artw at 7:13 AM on March 6, 2007

The author of this article fails to point out the rising costs of using steam to extract more oil. Sure you can get at reserves that you couldn't reach before, but that's only because it's economically viable when the price of oil is $60 and climbing. Sounds like peak oil to me.
posted by pepcorn at 7:15 AM on March 6, 2007

Like Easter Island, only with cars.

(correction to that link, the Easter Islanders didn't all die).. the population went from around 15,000 in c. 1500AD to 111 in 1877, equivalent to our current global population of 6bn+ reducing to around 45m. Not extinction, but perhaps still worth worrying about.
posted by imperium at 7:23 AM on March 6, 2007 [1 favorite has favorites]

I am far from an expert in peak oil, but having seen so many MeFi posts that claimed that the world was about to be destroyed, I thought this was an interesting counter-discussion, led by a New York Times article. What bothers me about this is that people aren't reacting to the articles, with the exception of some people (like eriko) who really seem to have lots of information at their disposal, and know the arguments far better than I. The rest seem to be randomly lashing out without actually reading the articles. For example, the CERA report doesn't deny that oil is running out, it concludes:

It is no longer sensible to allow the issues about future supplies to be clouded in a debate grounded in a flawed technical argument. There is general agreement that a peak or plateau of sorts will develop in the next 50 years, and it is not helpful to couch the debate in terms of a superficial analysis of reservoir constraints. There is a need to identify the signposts that will herald the onset of the inevitable slowdown of production growth and ensure that policymakers outside the energy community have a clear understanding of possible outcomes and risks.

The question of peak oil, as I understood it, was whether or not the decline in production cheap production would be soon and whether or not it would be steady. If it was, then, from what I understood the argument to be, rising prices and shortening supplies would lead to a collapse of the world economy before we could switch energy sources. If production plateaued, and we have a bit more time, then we might be able to switch energy supplies in time. Most MeFi posts I saw argued the former, the latter seems to be more true. I think that is a good thing.

And, delmoi, I wasn't trying to make a strawman argument, I should have said "decrease steadily" not "decrease sharply" but note how the graph you linked to shows a decline in oil production happening tomorrow, even though oil production is increasing up to today. That seems like exactly the kind of argument that the CERA and NY Times pieces are arguing against.

But heck, I could be wrong, and I should be fortifying my house rather than wasting time on MeFi right now...
posted by blahblahblah at 7:29 AM on March 6, 2007

Repeat after me, peak oil is the end of cheap oil. Not fast oil, not oil supplies, not exploration- just the end of cheap oil.

First, the oil industry is efficient, possibly the most efficient large industry in the world. Despite everything that has happened, a gallon of gasoline is still cheaper than a gallon of Evian or Red Bull. If there is profit to be made in tar sands, at the bottom of the ocean, or on the moon they will get it out and drive the extraction cost as low as possible.

The problem is not production to meet current demand, the problem is that current demand is a poor model of future demand at current prices. Most of China and nearly all of the Indian subcontinent are not yet industrialized. If their consumption habits approach that of Europe, never mind the United States, it's game over. There is not production model in existence that can meet this demand. As demand outstrips supply, the prices go up.

Here's the problem. "Cheap" oil is a relative term. What is cheap? It's not an arbitrary number. It's cheap relative to the cost of everything else. But everybody competes for the same oil. Yes, there are some supply agreements cut here and there, but that is baseline subsistence supply. There's always demand in excess of what is supplied under these agreements. Yes, the US controls or influences a lot of the production facilities in the middle east, including iraq, but that is simply to make sure the oil gets to market- NOT to keep it off the market.

The problem - and this is the fundamental underlying problem of the twentieth century - is that the United States cannot afford the oil at the prices on the market.

There's an elaborate system in place now to prop up the world economy. Oil is a global commodity priced in dollars. Great. Most of the oil in the world is supplied by the middle east or small third world countries. Set Russia aside for a moment, because they are a special case. When everyone buys oil, they buy it in dollars and those dollars go to the suppliers as dollars, not as local currency. So now the middle east and the third world are sitting on a pile of dollars. What do you do with dollars? Well, you can exchange them for something else, but that's just passing the buck. At some point those dollars end up in bank reserves (which already have all the dollar reserves they want), or they end up back here purchasing financial assets of the government or private sector. A lot of that money buys US govt debt, allows the US to deficit spend. It's very symbiotic. Wonderful.

But now there's an X-factor - China. China has a lovely currency, the yuan, that floats slightly but is still basically pegged to the dollars and some other currencies. A lot of countries have done this, so it's not unprecedented.

What is unprecedented is that this country with a pegged currency runs a huge trade surplus with the US, meaning they ship us way more than we ship them. Hmm. Normally, the currency markets balance this out as the nete exporter's currency rises relative to the net importer's. (i.e. the yuan should rise against the dollar).

But it can't, because it's pegged. So China has ever growing dollar inflows, we have ever growing outflows. They buy a lot of our debt too, wonderful, so now we can deficit spend and have wars and build bridges for a hundred people to use.

But the problem is this is not tenable. As China grows, it consumes more oil, which is also priced in dollars. They don't feel the pain really because the dollars are coming from US. We do feel the pain, because guess what, that oil price is increasing for us too. That's the mechanism which should slow US consumption, rising oil prices. China is now a huge consumer of oil, almost the largest if not actually the largest. Their impact on the market is huge (and their impact on other non-precious metals commodities is even greater).

Here's the short summary of all of that - oil is the de facto Chinese currency. To balance trade, oil must rise, because the currency won't. The market always finds a way.

The problem is that in the United States, we are consumption happy. We have racked up personal debt, government, debt, and mortgage debt to horrifying levels - and you can't blame government for doing what people do. The analogy that Ross Perot used to use, "at the end of the day, somebody has to pay the bill" falls flat because Americans do not believe they ever have to pay the bill. So we haven't slowed our consumption because moeny in the US is cheap.

Money in the US is cheap because you cannot get elected by contracting the economy. The economy right now is powered by money that didn't exist before you spent it. bought something for $1000 on credit? You just created $1000 out of thin air. The analysis is a bit more complex and the math a bit more rigorous, but you get the idea. If people are buying $500k homes with interest-only mortgages, and furnishing them with $10,000 of credit card debt, guess what, the economy is too large. That is spending that should not exist.

So as china grows to sell us more crap to buy with our credit cards, oil is going up, but the economy isn't slowing, so how does the system regulate itself? By tanking the dollar. Everybody in the world with a clue is looking at US debt, private, corporate, government across the board and seeing way too much leverage, way too much. The system is close to busted. It may take twenty years to bust, because the scale is enormous and enormous things moves slowly, but it is not sustainable. So they get out of dollars. Very slowly, because you don't want to break the consumption engine that your production economy depends on, but you make some re-allocations. And the dollar declines. And smart Americans are doing the same thing. They are buying commodity funds and gold. Warren Buffet was in precious metals in 2001, because he is very risk averse and likes to think ahead. A quarter-trillion dollar war in the post-dotcom, post 9-11 economy? That was already running a $250 million deficit? Good luck with that.

The morale of the story? Oil a commodity priced in dollars is up, and the dollar itself is down. OIl producing countries like IRan now and Iraq in 2002 were looking to get out of the dollar business and establish a parallel euro-oil market. That would result in wholesale abandonment of US debt by these countries, as they'd no longer have the petrodollars and thus would no longer need US assets to invest those dollars in.

That's peak oil. Peak oil is a fundamental shift in the American way of life while the rest of the world improves.
posted by Pastabagel at 7:47 AM on March 6, 2007 [24 favorites has favorites]

I am far from an expert in peak oil, but having seen so many MeFi posts that claimed that the world was about to be destroyed

"Peak Oil" is not a synonym for "The world is about to be destroyed" No one is saying that the world is about to be destroyed except some crazies. Peak Oil simply means that at some point, the global oil production will reach a maximum, never to be reached again. Obviously this must happen.

Furthermore, if you look at the history of oil production, this has happened again and again in different regions, including the US in the 1970s. The U.S. still produces a lot of Oil, in fact it’s actually the worlds #2 producer of Oil. It seems really unlikely that these trends will change. People can drill more, but production is going to have to decline at some point.

The question of peak oil, as I understood it, was whether or not the decline in production cheap production would be soon and whether or not it would be steady. If it was, then, from what I understood the argument to be, rising prices and shortening supplies would lead to a collapse of the world economy before we could switch energy sources.

Well, then you just understood it incorrectly. People expect oil production to decline steadily, and only crazies would argue that it would crash the world economy. There are plenty of crazies out there, but using them to disprove "peak Oil" is like using the arguments of eugenicists to disprove Evolution.
posted by delmoi at 7:48 AM on March 6, 2007

That's peak oil. Peak oil is a fundamental shift in the American way of life while the rest of the world improves.

Pastabagel: while what you said may be true it has nothing to do with peak oil. In fact, the situation you formulated would be the same whether global oil production was peaking, or if it was going to stay at current levels forever.

Peak oil is only an argument about the amount of oil coming out of the ground it would have an effect on global economies, but global economics doesn't change anything.
posted by delmoi at 7:56 AM on March 6, 2007

blahblahblah, I think a goodly number of people here have a fairly good grasp of the concepts of peak oil. And we probably have a better grasp of people. Western culture is based on mobility, consumption, and growth, all of which is steeply integrated with petroleum. Every single thing we do is multiplicatively effected by fuel costs (which is why the measure CPI excluding fuel and food, due to volatility, ignoring that they affect everyone). Most people don't make changes because it's the right thing to do - they make changes becuase the alternate is too painfull. Do you think people quit smoking because of the education efforts of its dangers, or because of the rising cigarette taxes. Do you think SUV sales have slid due to increasing environmental awareness, or maybe it was the rising price of gasoline?

The whole point here is that industry, their PR flacks, and those in government will reduce changing the status quo as long as possible, and will only make a change when the status quo is too painful to bear economically.
posted by rzklkng at 8:02 AM on March 6, 2007

Sorry to be flip in my post above. The technical summary ishere, but the basic idea is that when you extract anything from the ground, you always extract the easiest stuff first, which is by definition the cheapest to extract. But over time, you've depleted all the easy sources (the low hanging fruit, so to speak) and now you have to invest in technology to get at the harder to reach stuff.

The analysis then shifts to your return on investment (the new tech to get the stuff out). If the return on investment is low, is it worth doing something else with that money? What if the return on investment is negative? E.g. you spend $X but the present value of your projected future returns are $0.95X. It's not worth doing, or you find some way to increase the future revenue, by, say, starting a war on top of a huge oil field.
posted by Pastabagel at 8:02 AM on March 6, 2007

In fact, the entire peak oil theory might be based on flawed assumptions.

Right, because believing in an infinite resource is so fucking rational.
posted by teece at 8:08 AM on March 6, 2007

Peak oil MetaFilter:
...a natural definite end to our carbon spewing ways.
...a fundamental shift in the American way of life while the rest of the world improves.
...will reach a maximum, never to be reached again.
...running out of fast oil.
posted by blahblahblah at 8:09 AM on March 6, 2007

eriko is right on. Cheap oil is something we will probably never see again, the big worry by oil companies and investors is that Saudia Arabia or some other country (well let's be honest, Saudia Arabia) is holding back and artificially inflating prices ... or that they have oil wells not online. Saudi Oil fields are so large they kind of march right down them until they can no longer cheaply get oil out and then place the wells further south. They have amazingly complex 3D models predicting how much oil is in those reserves but the truth is they don't know. And they are very secretive (most information about oil wells is based on anecdotal information and decades out of date).

From an investment perspective it is suicide to put capital into CO2 pumping in off-shore California fields or wherever else we once extracted oil but it became too expensive to continue to do so. Remember the 90s were less than a decade ago and oil was incredibly cheap, so cheap that big oil is very hesitant to believe that the current prices are not sustainable.

I think this assumption has more or less proven itself false and we will see investments now that oil is sustainable at $50/bbl+.

Now here's the real kicker, coal can be converted to oil relatively easily -- at a price right around or above $50/bbl. We are the Saudi Arabia of oil. Australia is the Iran of oil. Well I can continue the metaphors but there is a lot of coal left. If you think extracting oil and burning it is bad for the environment wait until you see how bad extracting coal and then converting it to oil and then burning it is. Extracting oil is basically replacing aquifers with water underground and most of the pollution is caused by the burning. With coal you have to blow up mountaintops, basically destroy the groundwater in the area, convert the coal to oil and then we add in the pollution we are already causing as of today.

I believe that the only way to combat this and force investors (who think in a purely quantitative manner) is to implement a carbon market. As the Euro model indicates, it is not going to be done easily. You will not have large institutional investors going to green energy out of sheer kindness of heart. Investing in oil infrastructure is risky, investing in completely unproven technology that has a track record of failure is stupid. It is not investment but philanthropy. At the same time a carbon market is going to be resisted by people with deep pockets and influential friends. Until the power structure of this country changes (which it very well might in the next few years), it won't happen.

In any case "peak oil" is death by a thousand cuts of a few hundred years, not having your intestines spill out your ass in a dramatic Ebola hemorrhage.
posted by geoff. at 8:11 AM on March 6, 2007 [1 favorite has favorites]

Pastabagel: while what you said may be true it has nothing to do with peak oil. In fact, the situation you formulated would be the same whether global oil production was peaking, or if it was going to stay at current levels forever.

Peak oil is only an argument about the amount of oil coming out of the ground it would have an effect on global economies, but global economics doesn't change anything.
posted by delmoi at 10:56 AM EST on March 6

If production was increasing to match increased demand coming from the developing world, the oil price wouldn't rise. You're right that peak oil is really a mining/resources issues, but it takes on a much larger scope because oil is directly correlated to economic growth because it has no nearly effective substitute and is a production input for absolutely everything. Walmart cares about oil, Ford cares about oil, Kellogg's cares about oil, and Google cares about oil. All for different reasons, but it's the same production input. No other commodity is like this on the same scale as oil. Copper is a way way way distant second, because of electricity distribution but there is no peak copper situation. Sill, look at copper prices since 2002.

Peak oil only matters because it (as a resource issue) is coming to a head just as the global economy is in transition and as the US economy's fiscal mess is coming to a head.
posted by Pastabagel at 8:13 AM on March 6, 2007

We are the Saudi Arabia of coal, as is Australia. Damn typos. Maybe it was Freudian.
posted by geoff. at 8:13 AM on March 6, 2007

Delmoi: The U.S. still produces a lot of Oil, in fact it’s actually the worlds #2 producer of Oil.

Russia is #2.

Industry groups (i.e., CERA) are teh funny.

Stupid, but funny.
posted by Skygazer at 8:17 AM on March 6, 2007

Well I can continue the metaphors but there is a lot of coal left. If you think extracting oil and burning it is bad for the environment wait until you see how bad extracting coal and then converting it to oil and then burning it is.

Which is why environmentalists are starting to warm up to nuclear. Yeah the waste is bad, but not as bad as mountaintop removal.

I think most of the opposition to Nuclear is the result of an irrational phobia, frankly. It solves a lot of our problems, and replaces them with smaller ones.
posted by delmoi at 8:25 AM on March 6, 2007

Reality check:

DOE estimates that world oil demand will increase by 47 percent from 2003 to 2030. Non-OECD Asia, including China and India, accounts for 43 percent of the increase.
posted by Pastabagel at 8:31 AM on March 6, 2007

I also agree with eriko's comment, we've seen the end of cheap oil ($20/bbl), but we're nowhere near the top of "peak oil". The problem with Hubbert's curves is that he assumed oil extraction technology would stay roughly the same the same, more or less, that only 1 barrel can be extracted economically for every 3 barrels in the ground. This is much less true now than it was 20 years ago.

The thing is, we now live in a $50 to $80/bbl world, which makes other extraction techniques, like shale oil, bitumens and coal conversions attractive. It also makes biofuels competitive, by the way. Biodiesel and ethanol are not attractive below $50 barrel either.

Peak oil was only a "trap" in a very narrow set of circumstances: cheap oil, only incremental technology changes, constant increases in demand. Those factors are much less true now than they were when Hubbert proposed this peak, and will be much less true ten years from now.
posted by bonehead at 8:39 AM on March 6, 2007 [1 favorite has favorites]

You guys all need to cheer yourselves up like I do by playing one disaster off another: When avian flu finally morphs into an easily-spread variant and kills a couple hundred million worldwide and decimates Asia in particular, POOF - peak oil gets pushed back by at least a hundred years, I can finally get some Red Sox tickets, and we get reduced carbon emissions as a sweet bonus!

Yea, I know, it's the optimist in me, what can I say?
posted by jalexei at 8:53 AM on March 6, 2007

Repeat after me, peak oil is the end of cheap oil.

*Hammer hits nail on head.*

Peak oil is a fundamental shift in the American way of life while the rest of the world improves.

*Hammer misses. Bends nail. *

The whole world is riding on a bubble of cheap oil. When it's gone EVERYONE will suffer, America perhaps least of all since America can afford to pay a lot more for its oil than it currently does.
posted by three blind mice at 8:54 AM on March 6, 2007

“There is general agreement that a peak or plateau of sorts will develop in the next 50 years, and it is not helpful to couch the debate in terms of a superficial analysis of reservoir constraints.”

Look, we know we’re all going to die if we keep doing what we’re doing. But that’s no reason to stop giving us your money.
Oft missed point in the Easter Island discussion - those heads were a form of “money” (status, power, et.al) as well. Reminds me of the old Sioux aphorism “you can’t eat money.” And of course, those folks could flee to somewhere else. We don’t have another island.

I do have a question though: is it pronounced ‘Sunoco’ or ‘Sunoco’?
posted by Smedleyman at 8:57 AM on March 6, 2007

Oh and I must say, rather emphatically, that we need to approach this by agreeing on the axiom that oil is one of the best energy sources out there in terms of transport, storage and energy density. There really is no feasible energy source which we have in great supply or ability to convert in great supply in the near term. As such we should actively:

(1) Restrict emissions levels by several times what they are now (and allow people/corporations pay into carbon credits for research and such if they do not want to),
(2) Dump research dollars on ways to improve emissions for power plants, industry and vehicles
(3) Look into ways into creating oil from non-traditional sources in an economic and environmentally sustainable fashion,
(4) Dump research dollars into alternative energy sources by using government funding as no private investor is going to put the money needed for something which would not see real gains in a lifetime.

Wouldn't it be great if we could use some of those international trade organizations to create an architecture for this? Oh if the candidates would stop bickering about trivialities and start proposing solutions to problems ...
posted by geoff. at 9:01 AM on March 6, 2007

Take a look at the island now. There is nothing left on it but grass and stone heads. In desperation to survive they consumed everything. I think there are only insects left now, but I can not find a reference.

I took a look at the island, using Google Earth. It's not a rain forest, but there are a lot of trees, especially in a large area near the middle of the island. Buildings, too.
posted by Kirth Gerson at 9:02 AM on March 6, 2007

Why, when anyone says that the Earth's resources are not infinite, does the entire world hear "ohmygod, we're going to run out tomorrow!"

Peak Oil doesn't say oil will run out soon. In fact, it says oil will never run out. It takes the observed fact that oil wells reach a peak in their production, which then slowly drops, never quite reaching zero.

It predicts that we will see the same effect for global oil production. So far, all the major fields are following their depletion curves one by one...
posted by Djinh at 9:25 AM on March 6, 2007

(4) Dump research dollars into alternative energy sources by using government funding as no private investor is going to put the money needed for something which would not see real gains in a lifetime.

The shortsightedness of politicians always seems to make the corporate interest in profits now seem relatively responsible. I guess I'm just amazed given the sheer amount of cash that ExxonMobil and others are swimmining in there isn't more research going on.

Whoever figures this out is going to be king or queen of the world. Seems like you could increase the amount spent on research by a rather large degree of magnitude and still not consume the interest these companies are earning on recent profits. Biofuels are particulary exciting in the sense that you can use them in a variety of existing machines/technologies with minimal modification, unlike, say, getting a hydrogen car to work, or making my oil furnace burn coal.

If I were the president of BP or Citgo, I might ask my engineers to figure out how to grow large amounts of crops with no/drastically reduced petrochemicals, and maybe in a decade or two I'm splitting my stash of delicious and healthy pressed vegetable oil between my salad and my composite/ceramic 1000 pound, 650 hp, ultra-low-emission, 175 mpg Mercedes turbo-diesel, while still supporting oil companies that were able to preserve their investments in things like pipelines and filling stations.

Ahhh, screw it - I'll just load up that slush fund in the Caymans and prepare the compound to repel the starving hordes....
posted by jalexei at 9:27 AM on March 6, 2007

It's politics, not geology.
posted by acetonic at 10:27 AM on March 6, 2007

This in essence is the entire debate – can all the unfound and unproven resources be exploited quickly enough to more than offset the peaking and decline of the known and proven reserves? If not, they simply guarantee that some sort of oil industry will be around for a long time but one that will be unable to meet the requirements currently placed on it.
--Chris Skrebowski (Editor, Petroleum Review), Open Letter To CERA:

CERA's entire argument is based on the role of low probability reserves in future production. 1 week before CERA published its cheerful little thought-piece, Exxon closed its Baku offices. It spent over $3 billion on a series of dry holes in the Caspian in a convincing demonstration that CERA's low probability reserves are precisely that - improbable.

Deliciously, Exxon fund CERA.
posted by falcon at 10:36 AM on March 6, 2007

Whether it's right or not, I love Kunstler's The Long Emergency, if only as a righteous apocalyptic jack off session. Christians get their rapture, we get our global warming and peak oil. Unfortunately, we're probably right, and in twenty years I probably won't have a nice country home with a dog but will look like some wretched peasant in a Kurosawa film.
posted by bukharin at 10:39 AM on March 6, 2007

Take a look at the island now. There is nothing left on it but grass and stone heads. In desperation to survive they consumed everything. I think there are only insects left now, but I can not find a reference.

Those must be fairly new. I am referring to 1722

When Easter Island was "discovered" by Europeans in 1722, it was a barren landscape with no trees over ten feet in height. The small number of inhabitants, around 2000, lived in a state of civil disorder and were thin and emaciated. Virtually no animals besides rats inhabited the island and the natives lacked sea-worthy boats.
posted by Mr_Zero at 11:11 AM on March 6, 2007

Wow, I was hoping I could cross off "Solve peak oil" from my to-do list, but I guess there's still more work to be done.

In the meantime, I can't help myself...

MetaFilter: Idiots.
posted by grapefruitmoon at 11:18 AM on March 6, 2007

Those must be fairly new. I am referring to 1722

Oh. I guess the "now" in "Take a look at the island now" threw me off.
posted by Kirth Gerson at 11:25 AM on March 6, 2007

There's another angle to this that nobody here seems to have touched on directly:

Peak Net Oil Exports.

A real smart fella named Jeffrey Brown has written an article about how he's figuring that as production peaks in any given country, not only will there be a total decline in oil produced there, but the reduction in that country's ability to export oil will be much more dramatic than the production decline - IF that country's population is also using more and more oil.

Here's Mr Brown's summary:

Let's assume that we have a world where all oil production is from one country--Export Land--that produces 20 mbpd, consumes 10 mbpd [million barrels per day -z] , and exports 10 mbpd to oil consuming countries around the world.

Export Land hits the 50% of Qt (URR) [total recoverable crude oil -z] point, and over a five year period production drops by 25%. Over the same time period, Export Land's consumption increases by 20% to 12 mbpd. This causes Export Land's net exports over the five year period to fall from 10 mbpd to 3 mbpd, a decrease of 70%--resulting from a combination of increasing domestic consumption in Export Land and a 25% drop in production.

Hmm, maybe that's a little jargon-y, so I'll try to translate it:

Country X produces oil, much of which it exports to other countries. The world market oil demand grows every year, so as Country X increases production, they can export more oil every year.

Country X also has a growing population, which is raising its standard of living toward Western levels, and consequently using more oil every year internally.

Country X reaches its peak of oil production, so now they extract less oil every year than the year before. However, the population is still growing and modernizing, so internal demand for oil keeps increasing.

So now Country X has less total oil to sell, whether internally or externally.

Assuming - and this is a very key assumption - that Country X will decide to completely satisfy its own population's growing demand for oil before it exports any oil, this means that the internal demand will start cutting into the export capacity quite rapidly.

In the case of Brown's highly simplified Export Land, they go from producing 20mbpd to 15mbpd, while increasing internal use from 10mbpd to 12mbpd, leaving only 3mbpd to export. Shrinking from 10mbpd to 3mbpd over 5 years is a rather drastic reduction.

As the world rolls over the total peak of production, there will be a smaller "export pool" available from all oil-producing countries, so anyone who imports oil will have to start bidding higher and higher for it, to get a piece of a shrinking pie.

Mr. Brown thinks we're already seeing this problem, as there are news reports out there about dire fuel shortages and chronic electrical shortages in countries, mostly in the Third World (quite a few in Africa, for example) that have been largely priced out of the market by $60/bbl crude oil.

The key to Brown's thoughts are that a 25% decline in production over 5 years translates out to only about a 6% or 7% annual decline rate - which doesn't seem so bad on the face of it, it seems like a gradual reduction. But, that 6% decline rate becomes more like a 14% per year reduction in exports, which is a lot more noticeable.

So, simplified, if overall world oil production shrinks at some smallish% per year, the oil available for export shrinks at a magnified rate, perhaps greatly magnified, dependent on internal usage in the producing countries. This would be a source of serious economic problems across the board, for everyone, but most especially countries that import a lot of oil.

This problem is highly complex of course, as many nations, in order to keep the cash flowing in, may decide to suppress internal oil use in favor of exporting oil at higher prices, thus bringing in more revenue. That may actually work - for a while - if the export pool shrinks fast enough and the price goes high enough to compensate for the loss of internal energy growth.

Really, the whole energy picture is very murky, because so many countries treat their production and reserve numbers as highly classified state secrets.

Note that the US rolled over its peak in 1970, and since then has become a large importer of oil, as we import about 60% of what we consume. A shrinking export pool would affect us instantly. China's growing use of oil is indeed a major factor - and they're a lot closer (physically) to the oil than we are, as is India.

Oh, and the Easter Islanders have only wound up surviving because the outside world started interacting with them. They received external inputs that have allowed them to recover - a couple of seaworthy boats, good fishing nets, rods, hooks, and some crop seeds goes a looooong way.

Currently, the earth as a whole has no such external inputs, other than sunlight and the occasional asteroid/comet impact. The sunlight, at least, is immediately useful!
posted by zoogleplex at 11:35 AM on March 6, 2007

“Those must be fairly new. I am referring to 1722”

Durwha?

“Even more impressive were the abandoned statues-as tall as 65 feet and weighing as much as 270 tons. How could such a people create, and then move such enormous structures? The answer lies in Easter islands' ecological past, when the island was not a barren place.”
posted by Smedleyman at 11:35 AM on March 6, 2007

Smedlyman, I think he was referring to the trees I saw in Google Earth. It's hard to be sure, though.
posted by Kirth Gerson at 12:31 PM on March 6, 2007

The best refute of "peak-oil isn't going to happen" is the observation that the people with the best numbers, IE: Oil companies, aren't rolling out new, capital intensive, refineries in North America despite current 100% utilization. They know that increasing refining capacity isn't going to pay back because feed stocks are going to decline and are there for acting accordingly.
posted by Mitheral at 1:30 PM on March 6, 2007

I'm not really getting how an "undulating plateau" is much of an improvement on a single peak.

Historically, even modest reductions in petroleum production have been accompanied by very serious economic fallout. We call them "shocks" for a reason, after all.

The notion that a decade of repeated, even overlapping shocks is a comforting vision of the future just serves to underscore how dire the problem may be.
posted by Western Infidels at 1:35 PM on March 6, 2007

... the Easter Islanders didn't all die).. the population went from around 15,000 in c. 1500AD to 111 in 1877, equivalent to our current global population of 6bn+ reducing to around 45m. Not extinction, but perhaps still worth worrying about.

...

When Easter Island was "discovered" by Europeans in 1722, it was a barren landscape with no trees over ten feet in height. The small number of inhabitants, around 2000, lived in a state of civil disorder and were thin and emaciated. Virtually no animals besides rats inhabited the island and the natives lacked sea-worthy boats.

...


Oh, and the Easter Islanders have only wound up surviving because the outside world started interacting with them. They received external inputs that have allowed them to recover - a couple of seaworthy boats, good fishing nets, rods, hooks, and some crop seeds goes a looooong way.

Funny—no mention of the role the Peruvian slave trade of the 1860s played in practically wiping out Rapanui culture. The Peruvians 'blackbirded' (i.e. kidnapped) up to forty percent of the island's population (most of whom died within a couple of years as a result of disease and maltreatment on the South American mainland), and also introduced smallpox. That's the reason the population was only 111 in 1877.

The nature, severity, and timing of the earlier environmental crash can only be worked out archaeologically, and I understand that there's still a good deal of scholarly disagreement about them. I really wish people would stop quoting Jared Diamond as though he were the last word on Polynesian history.
posted by Sonny Jim at 1:45 PM on March 6, 2007

Various interesting stuff on TOD lately:

Saudi Arabian oil declines 8% in 2006 -- it got mentioned, not linked to above. I'm not totally convinced that they're at the limit, but I guess we'll find out this summer when oil demand by refineries has its seasonal increase.

Peak Oil Update - February 2007 -- some very pretty charts showing what all the forecasts are saying. The "median prediction" calls for a decline starting now, but there's a huge range of possibilities.

Simple Oil Production Estimate for 2007 -- calls for a slight increase if all goes well.

A certain Prof. Goose keeps telling me to post this stuff to metafilter, so there it is.
posted by sfenders at 2:05 PM on March 6, 2007

In response to Kirth Gerson -- I think the trees were planted relatively recently, for lumber or bananas or something. I don't have Google earth, and can't find a good photo showing all of Easter Island, so I'm not sure if we are talking about the same set of trees.

But I don't think the fact that there are trees *now* changes the fact that the islanders foolishly cut down all the trees in the past.
posted by webnrrd2k at 2:35 PM on March 6, 2007

CERA headlines their own press release with a false statement: Peak Oil Theory – “World Running Out of Oil Soon.” Peak Oil Theory says nothing of the sort. If they start out with a lie, why would anyone trust any of the other claims in the CERA piece. These are basically the same industry hacks that spent 20 years proving that cigarettes don't cause cancer.
posted by JackFlash at 2:53 PM on March 6, 2007

OH GREAT MASTERS OF METAFILTER, I BESEACH THEE: Please add threading to the discussions!
posted by webnrrd2k at 3:01 PM on March 6, 2007

“But I don't think the fact that there are trees *now* changes the fact that the islanders foolishly cut down all the trees in the past.”

Thanks. I’m easily confused.
Y’know, I’ve often thought of Easter Island as analogous to Las Vegas. They get money, put up casinos, which brings in more money, to put up more casinos, etc. etc. etc. while sucking off water and other resources to support people living in a desert - who service the casinos - etc. etc. etc.
Sustainability, conservation, I dunno where ‘the right’ ditched that and ‘the left’ picked it up, but it seems pretty obvious a need. Whatever the case with peak oil, there are people (and I’ve talked to ‘em) who blatently say they could care less what happens to the world after they die. Makes me seriously reconsider my position on abortion (to enforcement without a license to give birth).

I’m genuinely curious whether there are oil folks and policy people who have this sort of disposition and allow it to dictate their choices. It’s one thing if I want to be fat, dumb, and happy, I’m not going to - thoughtfully - lay the consequences of that lifestyle on my kids though.
(I qualify b/c a lot of folks unthinkingly have unhealthy lifestyles with a number of consequences for their kids)
Greed is one thing, shorting out the human race’s (and your own grandkids’) survival so you can buy 10 more yachts right now is something else.
There’s really no room for this magnitude of failure in policy.
posted by Smedleyman at 3:11 PM on March 6, 2007

But I don't think the fact that there are trees *now* changes the fact that the islanders foolishly cut down all the trees in the past.

No, and I hope you don't think I was saying it did. See, when somebody says, "Look at the island now," and I can look at it now (or almost now), I go and look at it. In this case that showed me something very different from what was described, so I pointed that out.

Incidentally, Google Maps will show you satellite imagery of the island, even though there are no maps. Type 'Easter Island, click 'Satellite' and play with the zoom bar.
posted by Kirth Gerson at 4:05 PM on March 6, 2007

Smedlyman:
"""Sustainability, conservation, I dunno where ‘the right’ ditched that and ‘the left’ picked it up, but it seems pretty obvious a need."""

I agree that conservation isn't a "left or right" political issue -- there is a lot of common ground. Preserving land helps hunters as well as hippies. Sustainable logging helps make sure businesses have forrests to log, and will need employees to do so.

"""Whatever the case with peak oil, there are people (and I’ve talked to ‘em) who blatently say they could care less what happens to the world after they die. Makes me seriously reconsider my position on abortion (to enforcement without a license to give birth)."""

The kind of people who condemn their children to dealing with these problems disturb me too. I'm not saying I'm perfect or anything, but I want my kinds to have a better life *and* world than I did.

I've been a real lazy bastard lately... I need to get off my ass and start doing something, even if it's just writing a check every month to a good cause.
posted by webnrrd2k at 4:06 PM on March 6, 2007

The Chinese like to pretend they are building green cities, if they actually are maybe they will become des res.

I need to get off my ass and start doing something

Ah, but think of all the energy expended globally in supporting your activity! Better to sit down and write some code.

You can add your own threading*, webnrrd2k. Talk to orthogonal or something. Just don't thread my threads, you thread head.
*^{Assuming Firefox, greasemonkey etc};)
posted by asok at 4:18 PM on March 6, 2007

I don't recall anybody saying Peak was the end of the world?

I recall people saying that the US citizen will have to adjust lifestyles significantly.

I recall people saying not PREPARING for Peak will lead to lot's of people dying in the third world. In wars and of famine, etc. I think you see evidence of this happening NOW.

Say a bus is headed for you and I yell "Look out for the Bus, Blahblahblah!" would you just stand there saying "It could turn. It could stop. It could run out of gas. There is no reason for me to alter my course drastically based on your Doom and Gloom Bus scenario."

It ain't Doom and Gloom... it's well... reality.

And that CERA link grossly over estimates reserves JUST like it claims other do, in fact it is relying heavily on figures for oil nobody has found yet. So I wouldn't pop the Champagne yet.
posted by tkchrist at 4:48 PM on March 6, 2007

To Kirth Gerson:
Sorry, I misunderstood. Yes, you were replying to a specific post, but it wasn't clear to me what you really meant.
posted by webnrrd2k at 4:48 PM on March 6, 2007

Good news is not welcome here.
posted by LarryC at 6:02 PM on March 6, 2007

CERA being optimistic about future oil production is not exactly "news". They've been wrong for the past couple of years, but who knows, maybe reality will eventually come round to their way of thinking. I wouldn't bet on it, but predicting the future is hard.
posted by sfenders at 6:38 PM on March 6, 2007

Peak Oil is way less of a threat than just a simple OPEC boycott, or the aftermath of an attack on Iran.

During the OPEC crisis of 1973-74, oil prices *quadrupled*.

If that happened today oil would hit $240/barrel.
posted by storybored at 8:05 PM on March 6, 2007

This sort of discovery will be used for years to come to justify behaviors that harm the environment. It's like the time I found a $100 bill on the way to get my mail. For months I justified needless purchases because I had an *extra* $100 in the bank.
posted by inconsequentialist at 9:17 PM on March 6, 2007

"Sustainable logging helps make sure businesses have forrests to log, and will need employees to do so."

Yeah, car dealers used to have the same mindset. You don't sell one guy one car, you sell the same guy a series of cars. Build a relationship, all that. I have no idea where stability was cut out of the "wealth" equation. You'd think Joe Logger would want a cycle of tree cutting, all that. Some guy logging old-growth or on government land, that sort of thing - how long does he thing that's going to last? I dunno. I suspect you get German companies doing things in the U.S., U.S. companies doing things in China - etc. etc. - everyone exploiting or trying to exploit everyone else.
I think there's been a great deal of analysis of how the mind set works in this thread. I'm curious how it got that way. Buddy of mine keeps telling me I should sell my house, make money, buy a new one, fix that up, make more money. Hell, I'm comfortable in this house. Got it fixed up the way I want it. My kids are happy - why should I move? More money isn't going to make me more comfortable.
Seems tangential, but I don't think it is. If I have to use less energy to stay here - fine by me. Change habits, whatever. I think most people are like that - rather be comfortable than rich.
So why is this lifestyle the standard? Pretty obvious where the hold up is.
posted by Smedleyman at 10:47 PM on March 6, 2007

Well, around the web people do seem to be paying more attention to the NYT story than I would have expected. I was prepared to ignore it, but I've seen it linked to in too many places. To me it reads like fluffy PR, entirely devoid of informative reporting or compelling argument on the broad subject it pretends to address.

Describing a few individual projects, of which there are many, that will increase oil output from particular places tells you absolutely nothing about whether they will be enough to make up for decline rates elsewhere. Not that this means it's necessarily wrong, but it's not at all convincing. It's just the same stuff Yergin was relying on when he famously predicted falling oil prices for 2005. Not at all helpful in deciding whether this is the fifth time peak oil has been erroneously predicted, or the zillionth time some energy industry forecast is wildly over-optimistic.

It's true that the high price of oil is going to lead to gradually more effort to extract as much as possible, and that the effects this time round will for various reasons be different -- for better or worse -- than the effects of increased exploration and development during the prevoius "oil crisis". Anyway, it's not only the peak oil crowd failing to give us sufficient data to evaluate their estimates of exactly how much difference it will make.
posted by sfenders at 9:08 AM on March 7, 2007

"Buddy of mine keeps telling me I should sell my house, make money, buy a new one, fix that up, make more money."

Smed, if your buddy's still trying to do that now, he's gonna be in a world of hurt.

Stick with your happy home, make it more green and conserve if you can. That'll work fine.
posted by zoogleplex at 1:31 PM on March 7, 2007

Now, this would've been worthy of an fpp. Stuart Staniford shows us what the best of the web should look like when discussing oil production trends.
posted by sfenders at 8:16 AM on March 8, 2007