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.
1 Bill Harris on Mar 11th, 2008 at 6:06 am
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.”
2 Michael Ferguson on Mar 12th, 2008 at 11:47 am
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.
3 JdR on Apr 8th, 2008 at 12:55 pm
$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.
4 walter on May 26th, 2008 at 12:13 pm
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.
5 Rock on Feb 9th, 2009 at 1:14 pm
So much for the prediction!!! What a crack!
6 Glen Hiemstra on Feb 9th, 2009 at 3:02 pm
Anyone checked recently what Mr. Simmons is saying at the present time?
7 Glen Hiemstra on Feb 12th, 2009 at 3:38 pm
To see what Simmons is saying these days, check out http://www.simmonsco-intl.com/research.aspx?Type=news
8 Mark on Jul 1st, 2009 at 7:30 am
$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.
9 Glen Hiemstra on Jul 1st, 2009 at 9:21 am
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.