Peak oil

[imported_bingobazza]

Since the industrial revolution, oil has been the driver of global increases in GDP. When it runs out, maybe as soon as in 20 years, or becomes too expensive, we will lose all the GDP growth and perhaps revert to a largely agrarian existence without high petroleum based crop yeilds (if we survive the commodity wars) until a suitable replacement for oil is found. What do you think society be like after the oil age has finished?

Bingo.

[Sniper]

There is plenty of oil left to last our lifetimes, and by the time the earth runs dry there will be alternatives to take its place.

Don't pay any attention to the doomsday predictions related to oil.

[laserboy]

[ QUOTE ]
There is plenty of oil left to last our lifetimes, and by the time the earth runs dry there will be alternatives to take its place.


[/ QUOTE ]

Peak oil is not the point at which the earth runs dry, only the point at which worldwide oil production has peaked. The world will never run out of oil, but it will one day run out of cheap oil.

Consider that there has been exactly one major oil discovery over the past thirty years. North Sea production has already peaked. This would seem to indicate that most of the world's cheap oil has already been found.

[James Boston]

My simple theory is this:

There is PLENTY of oil still available. Once we hit the top of the bell curve, we will see prices begin to rise. But, there is a point where the public will react. Gas prices have been rising, and people have been complaining, but have you really seen that many hybrid cars on the roads? No. Gas is just expensive enough for us to complain, but not to react to. If it went to say, $10 a gallon, beleive me...you'd see a change. The big oil companies (which are in the oil business because it's the most profitable) will eventually have to do something to keep the money coming in. The world won't continue to buy conventional fuels regardless of price.

[RYL]

[ QUOTE ]
My simple theory is this:

There is PLENTY of oil still available. Once we hit the top of the bell curve, we will see prices begin to rise. But, there is a point where the public will react. Gas prices have been rising, and people have been complaining, but have you really seen that many hybrid cars on the roads? No. Gas is just expensive enough for us to complain, but not to react to. If it went to say, $10 a gallon, beleive me...you'd see a change. The big oil companies (which are in the oil business because it's the most profitable) will eventually have to do something to keep the money coming in. The world won't continue to buy conventional fuels regardless of price.

[/ QUOTE ]

Excellent point.

[imported_bingobazza]

[ QUOTE ]
Once we hit the top of the bell curve, we will see prices begin to rise.

[/ QUOTE ]

I agree, we have already seen 500% rises. Huberts curve has been very accurate so far. Are we at the top yet? Goldman Sachs recently issued a trading udate with a price target of $105/barrell...a 'super spike'. A french analyst said $380/barrell within 10 years.

The oil companies have vastly scaled back exploration, restated reserves downwards, and diversified into solar energy, (BP is the second biggest in the world) and the US hasnt built a new refinery in 3 decades. The tar sands in Canada arent economcally viable...or they would have been tapped by now. There will be no additional capacity brought online if it costs more energy to take it from the ground than it produces. The saudis cannot stop the price increases (and are large users of solar energy). If it took the world 150 years to use the first half of global oil reserves, how long will the second half last at present consumption (and hoarding) rates?

Dont kid yourself that all is well. There is nothing that can replace the scale and economy of oil when it runs out. Thinking there is 100 years left, or there is a super technology waiting in the wings would be a dream...and is.

Bingo

[James Boston]

[ QUOTE ]
There is nothing that can replace the scale and economy of oil when it runs out.

[/ QUOTE ]

Even Peak Oil fear mongers don't claim we're running out, just that it's about to get so expensive that it will turn the economy upside down. Saudi Arabia, the country who far and away profits the most from oil, doesn't come close to the profits ExxonMobile or Chevron see. Businesses that make that much money have no desire to drive away their entire market by demanding that it pay whatever price they set. Oil companies make oil expensive, IMO, not out absolute dependance on it. A recession in our future? Probably. Mad Max? Nah.

[imported_bingobazza]

[ QUOTE ]
Businesses that make that much money have no desire to drive away their entire market by demanding that it pay whatever price they set.

[/ QUOTE ]

I think my point is that their customers have no real choice. If they could set the price, they could just forget oil and make billions in the futures markets. The market sets the price, and while producers have been able to manipulate it in the past, their ability to do so must now be questioned since production is very close to peak to meet demand. And if you have a finite amount of any commodity left, wouldnt you be happy as the price eases higher?

Running out is a bad turn of phrase, depleting economically accessible fields would be more accurate. But the end result is the same.


Bingo

[DesertCat]

[ QUOTE ]
[ QUOTE ]
Once we hit the top of the bell curve, we will see prices begin to rise.

[/ QUOTE ]

I agree, we have already seen 500% rises. Huberts curve has been very accurate so far. Are we at the top yet?

....

The oil companies have vastly scaled back exploration, restated reserves downwards, and diversified into solar energy, (BP is the second biggest in the world) and the US hasnt built a new refinery in 3 decades. The tar sands in Canada arent economcally viable...or they would have been tapped by now. ...

Bingo

[/ QUOTE ]

Your post doesn't make sense. Oil prices are up 500% yet oil companies are cutting back on exploration?

The reality is that oil is as cheap as it ever has been, and has been getting cheaper over time. You are probably confused by U.S. "gas" prices, which aren't so cheap.

The reason that oil has recently gotten expensive in the U.S. has nothing to do with supply, it's caused by the declining value of the U.S. dollar and increased gas taxes over the last thirty years. Oil prices in Euros haven't changed much. As long as we run big deficits, our currency is likely to continue to depreciate and imported goods (such as oil) increase in price.

But even with this artificial boost to U.S. prices, look at oil prices vs. income and you'll see that oil is much cheaper now that it was 25 years ago, or 50 years ago. That's why oil companies aren't looking for more. That's why U.S. reserves and production peaked. No-one invests billions of dollars in new exploration to find something that's cheap and getting cheaper.

If we ever were really close to Peak Oil, prices would actually go up. We'd be paying $5+ a gallon, and over 100 Euros per barrel. Oil demand would plummet as people start lowering their consumption through very cheap and simple means (car pooling, mass transport, hybrid cars, not buying damn SUV's and buying econoboxes instead).

But since oil is still cheap and plentiful it doesn't make sense to do that now. Hybrids don't even pay for themselves at todays prices.

Most estimates are we are about 50-100 years from getting close to running out. The peak oil guys aren't very credible because they keep predicting doom in five years, and when it doesn't happen, they just move out their predictions another five years.

[imported_bingobazza]

ok, Im not here to say I am for or against this oil thing...I hope it never happens. All Im saying is that it is real, based on the facts that western governments, scientists and the oil companies freely admit and are now openly discussing. In the interests of a reasonable debate about this, here are a few links to some articles that may enlighten some of you to the true state of play. Also, do not overestimate how much global oil production is used in private transportation....its a small fraction compared to agribusiness, plastics, shipping, the chemicals and computer industry, air conditioning, heating, power generation, construction and manufacturing of every kind.

http://www.technologyreview.com/arti...ew_oil.asp?p=0

http://news.bbc.co.uk/1/hi/business/4077802.stm

http://www.energybulletin.net/5429.html
This is US Congresman Bartlet talking last month about what peak oil is and its implications.

Eventually it will be good, as our children will depend on clean an renewable resources...but we will live in a very different world until other methods takes up the slack, if they ever do.

Bingo