Matt Simmons Sees $300 Oil
by Glen Hiemstra on 10/03/08 at 2:16 pm | 
I am always interested when Matt Simmons, author of Twilight in the Desert, appears on the TV and comments on future oil prices. He is an oil analyst with a penchant for telling the truth rather than spinning either overly optimistic or pessimistic stories about peak oil (the day we will have used half the total global supply).
Last week he dropped into CNBC. Among other things, he anticipates $300 a barrel, though he says it is not possible to know just when this will be the case. But most important in this video, I think, is that he puts to rest the ridiculous notion that Alberta tar sands are somehow the answer to future energy needs. Take a minute to watch.
Update: Oil closed just short of $108 today, March 10, 2008.
Glen Hiemstra is a futurist speaker, consultant, blogger, internet TV show host and founder of Futurist.com. To arrange for a speech contact Futurist.com.
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Bill Harris
Mar 11th, 2008
Thanks, Glen. I just found Matt Simmons’ collection of papers and speeches over the weekend; he appears to have some good material. Note the solution he suggests, as highlighted in my comment: “Travel less.”
Michael Ferguson
Mar 12th, 2008
Google CERA and Daniel Yergin. He is more or less correct, but actually conservative for several reasons. To quote, “This is the fifth time that the world is said to be running out of oil,” says CERA Chairman Daniel Yergin. “Each time — whether it was the ‘gasoline famine’ at the end of WWI or the ‘permanent shortage’ of the 1970s — technology and the opening of new frontier areas has banished the specter of decline. There’s no reason to think that technology is finished this time.”
Additionally, this is primarily a China and India problem. Western Civilization is actually on a path to ‘energy independence.’
It is possible that oil could go very high in the short term, but bet on it trending toward $55 per barrel over the next twenty years.
JdR
Apr 8th, 2008
$55 a barrel?
Unfortunately, declining existing reserves are making it harder for increases in new production to create a net gain in overall global production. And with voracious demand from Asia, Russia, the Gulf States, etc.., things are bound to stay tight. Economies are having to adjust to the ever increasing price of crude oil. I doubt it will slip below $100 for very long – I don’t think I’ll ever see $60.00 oil again.
walter
May 26th, 2008
http://www.theoildrum.com has debunked CERA for years, pointing out that 8 times in a row their predictions have failed. It funny to note that while they still do not use the term Peak Oil, they have started to waiver and mention ‘above ground factors’. Whatever.
IEA reports are progressively getting darker. They’re now pointing to an ‘oil supply crunch’ for 2012 due to production gaps and will report later this year on a supply crisis.
Non-OPEC nations will grow at only 1% while demand exceeds 2.2%. Even if OPEC manages to take up the slack, the cutoff estimation is 2012 before that’s effectively done as well.
Given that the top 7 producers are not in the West and each is nationalized, it’s unlikely we’re going to get direct information (ie: Saudi)
The writing is on the wall and on your fuel gauge. Why not leave oil before oil leaves us? The Preparedness Principle is the hallmark of any government. Insist on it.
Rock
Feb 9th, 2009
So much for the prediction!!! What a crack!
Glen Hiemstra
Feb 9th, 2009
Anyone checked recently what Mr. Simmons is saying at the present time?
Glen Hiemstra
Feb 12th, 2009
To see what Simmons is saying these days, check out http://www.simmonsco-intl.com/research.aspx?Type=news
Mark
Jul 1st, 2009
$300bbl is still very real. Just because oil fell to $30-something earlier this year doesn’t mean he was wrong.
It’s impossible to predict all short-run exogenous shocks, but the long-term fundamental story for oil is intact.
Glen Hiemstra
Jul 1st, 2009
Mark, I agree that the original $300bbl is still realistic, in the longer term – it may be a while yet, as in a decade or two. Cambridge Energy reported that in 2008 the cost per barrel to find a produce new oil had risen to over $56 – this cost increase alone suggests where the eventual price will go. Recall that in the beginning it cost 10 or 15 cents a barrel to find and produce oil, and “old oil” found before the mid-70′s cost perhaps a dollar or two to produce. Thanks for commenting.