Wednesday, 29 October 2008

All hope abandon ye who enter here

The November IEA oil report has leaked out. FT has a copy. It's does not make pretty reading:
"The natural annual rate of output decline is 9.1 per cent, the International Energy Agency says in its annual report, the World Energy Outlook, the Financial Times reported. "
That means halving of the existing oil production available within a bit more than seven years. By 2015.
"Even with investment, output will slide by 6.4 percent a year, it said. "
That means halving of the all existing and planned oil production capacity within 11 years or so, assuming a normal oil sector planning horizon of c. 5-7 years forward.

This is radical.

If you do not understand how grave this is, there is nothing we can do for you.

The only glimmer of hope is the financial crisis and the global recession now unfolding:
"The IEA expected oil consumption in 2030 to reach 106.4 million barrels a day, down from last year's forecast of 116.3 million, said the newspaper.

It said the projections could yet be revised lower because the draft report was written a month ago, before the global financial crisis deepened"

Anything beyond 110Mbpd is a fool's dream and I'm sure even IEA knows this. Projected oil demand growth has been pushed down by the recession. Let's hope it's a long and severe one, that makes us think hard and long about energy decision and the near future.

Be prepared and good luck.

Through me you pass into the city of woe:
Through me you pass into eternal pain:
Through me among the people lost for aye.

Justice the founder of my fabric mov'd:
To rear me was the task of power divine,
Supremest wisdom, and primeval love.

Before me things create were none, save things
Eternal, and eternal I endure.
All hope abandon ye who enter here.

Such characters in colour dim I mark'd
Over a portal's lofty arch inscrib'd:
Whereat I thus: Master, these words import.