Wednesday, 11 June 2008

Who Are Saying Peak is Now or Near?

So you are coming around to the fact that Peak Oil is not a mere theory, but a physical/geological fact of life.

The next question after the first phase of admittance for most is: Are we there yet?

The opinions vary a lot, but are clearly converging. Below is a list of some well-known people, inside and outside the oil industry, who have called peak oil now or in the near future (a few years).

The usual culprits

Kenneth Defeyes
Geologist (ex-Shell), Princeton University

James R. Schlesinger
Ex-secretary of energy (US), ex-secretary of defense (US), ex-chief of CIA

Ali Samsam Bakhtiari
Now sadly passed away chemical engineer and oil production expert at the National Iranian Oil Company

Jim Buckeeex
CEO, Talisman Energy oil company

Chris Skrebowski
Editor (Petroleum Review), ex-editor (Petroleum Economist), consultant to KSA

Matthew Simmons
Investment banker, chairman, Matthew Simmons International

Then there are the people who think we are running into Peak Lite or a supply crunch. Peak lite happens when we hit a production plateau and demand outstrips supply. Supply crunch is the same in different words, although some believe it may only be a temporary state of affairs.

Sada Al-Husseini
Former production chief for Saudi Aramco

Jeroen van der Veer
CEO, Royal Dutch Shell
"Easy oil is at production peak about now or within a few years."

Warren Buffet
World's richest man, every now and then
"Peak oil within 5-10 years"

Robert Hirsch
Energy consultant for US government, researcher on peak oil mitigation
"We are on production plateau now"

Christophe de Margerie
CEO, Total oil company
"Demand to outstrip suplly within 10 years"

Fatih Birol
Chief economist, International Energy Agency (of OECD)
"Demand to outstrip supply during 2012-2015. Beyond 2015 we are in uncharted territory"

Alan Greenspan
Former head of Federal Reserve (US)
"Global oil supply peaks lower and sooner than had been contemplated earlier"

Wall Street Journal
"Oil Exporters Are Unable to keep up with demand". See ELM to understand this issue

Of course there are plenty of other clear headed thinkers who have put their money where their mouth is: Richard Rainwater (investor), T. Boone Pickens (investor), Richard Heinberg (ecologist), Colin J Campbell (geologist), Clifford J. Wirth (analyst), Jean Laherrère (oil industry expert), Dick Cheney (vice-president USA), David Strahan (journalist), Kjell Aleklett (researcher), Ugo Bardi (prof of chemistry), Jeffrey Brown (petroleum geologist), ... The list goes on and is increasing at an accelerating rate.

Of course, from purely theoretical point of view, ignoring all the data, it is possible that all of the above people are wrong.

That we will not hit a peak in oil production near term and we will recover from the current plateau in production.

However, to anybody who poses such a possibility there are a few important questions to ponder:
  • What is this magical thing that enables this increase in oil production to sustain (when no known technology can do it)?
  • What does it matter if we can pump oil faster for a few more years and increase production, when the only thing it results in is a much faster decline (we will drop off the proverbial cliff)?
  • What if you are wrong and the oil peak is now and depletion even faster than forecast?
These questions do not have sensible and easily actionable answers. They only lull people into a false sense of security through historicism: "things were solved earlier, they are going to be solved again" Voila! No explanation of underlying mechanism or reasoning through causal effects. Things just work.

The only sensible choice is to act now and worry about being wrong in the minds of naysayers later - and most likely never.

Advice? E L P