Peak Oil Again – Business Week Owns Up

Peak Oil Again – Business Week Owns Up

June 16th, 2007 | Posted in Business & Economy, Environment & Energy

There has been some recent and dramatic news on the subject of Peak Oil. Essentially, groups of scientists are beginning to more openly challenge the conventional industry assurances that oil has decades, and not years to run before a peak is reached.

This is critical, because the consequences of overestimating how long it will be before we start down the back side of the oil slope could be severe. When the midpoint of global oil supplies is reached, estimates are that the supplies will diminish at between about 2% to as much as 8% per year, depending on several factors, primarily price and demand. But the industrial world is in no way ready to handle such a decline, and in fact demonstrates a perplexing lack of preparation.

The situation is in disturbing ways similar to the generally accepted view of global warming a decade or two ago, that the idea was merely the musings of crackpots. Now we are learning the consequences of denial.

A good overview of the current news can be found at DailyKos.

Both Business Week and The Independent in the UK have run stories this week challenging the excessive optimism of a recent British Petroleum forecast which imagines a 40-year run for oil before it peaks. These articles and others point out, correctly, that oil exports from exporting nations have been flat or in decline for two years. Just as the U.S. was an oil exporter until our supplies peaked in the early 1970’s, now countries like Saudi Arabia, Russia and Iran see their own domestic demand rising quickly, while oil poor nations like China and India look for imports everywhere. All of the major oil fields are flat or declining, and no new really large fields have been found in recent years. The discoveries that are announced tend to be in very difficult locations like the arctic or deep water and even then contain only months of global supply.

Beyond that we hear suggestions that tar sands and shale and coal to oil will be our salvation, but it takes just a few minutes of research in each case to see how illusory these ideas will turn out to be, not to mention out of bounds in a melting world.

It is time to wake up. The money spent in Iraq could have been better spent, for example on battery technology like that of AltairNano, and the electric cars they are helping to prototype. Last week while visiting them in Reno I shot this short video in the company parking lot, after enjoying a drive in the car:

Finally, a wonderful 1970’s video of the original theorist of Peak Oil, King Hubbert, has been discovered and posted, and is worth a look.

Glen Hiemstra

About Glen Hiemstra

Glen Hiemstra is the founder and owner of Futurist.com. An internationally respected expert on future trends, long-range planning and creating the preferred future, Glen has advised professional, business, and governmental organizations for two decades.

5 Comments

  1. Ron   |   Mar 2, 2008

    Oil will never go below $85 again. In 2010 oil will be over $250 a barrel and gas will be $10 a gallon. Even though reserves are rising which should make oil prices drop the fact they don’t drop in price is because the political tensions are rising. With that you will either buy a hybrid which will still be expensive to operate or ride your bike or take the public transit. There are ways to reduce your fuel cost.

  2. http://absolute-insurance.info   |   Nov 9, 2007

    Every insurance agent on the planet is with you on this one. We’re all starting to wake up to what this road is going to cost if we keep going this direction. Oil burning systems should now come with a disclaimer that they have a potentially highly limited life span.

  3. Guest   |   Nov 9, 2007

    Every insurance agent on the planet is with you on this one. We’re all starting to wake up to what this road is going to cost if we keep going this direction. Oil burning systems should now come with a disclaimer that they have a potentially highly limited life span.

  4. Bill Harris   |   Jun 18, 2007

    Glen, I share your concern that we seem to act as if the future will be a natural extension of the present. As you know, I did a model some years ago to explore peak oil; in the process, I discovered that my perhaps naive model of how peak oil might play out was scarier than I thought. I published that model at http://www.pegasuscom.com/aar/model5.html . Note that the column on that page is just the story to interest people; the real lessons come in the downloadable model. I do invite your and others’ feedback.