First, realize that the major international oil companies (IOCs) have finally admitted that there are not many new reserves left to find. They try to obscure what this means by claiming they are going to develop existing unconventional sources but the cost of doing this is far from trivial, both economically and environmentally. Just wait til you Canadians see the disaster that tar sands are going to make of your country.
Elsewhere, Stuart Staniford has been tracking the current plateau of world oil production that started in July 2004. His latest update covers recently released figures and shows how recent releases have had to be subsequently downgraded later. So every time the world thinks it has hit 85 million barrels per day of production, a month or two later the admission comes out that, oops, guess we didn't. As Stuart notes, while there have been peaks before in world production, each prior peak was preceded by a decrease in demand due to other factors. This time there has been no drop in demand only inability to meet demand with more oil. This is the first time ever in the history of human oil production and consumption that this has occurred. And it's occurring in exactly the time frame predicted by Dr. M. King Hubbert more than half a century ago.
At the same time we see that oil now hovers near $70 per barrel give or take a dollar or two depending on geopolitical factors. It is now generally acknowledged that oil will never drop significantly without a major global economic recession or depression to reduce demand on such a scale that there is a (temporary) surplus. We also see that Toyota has had to increase Prius production multiple times and has passed 500,000 Priuses sold worldwide so far. And that car just gets better and better with a rumored 94mpg turbocharged optional plug-in hybrid version coming in the next few years.
Meanwhile we have firm denial from the IOCs about peak oil still, this time in the form of Lord Brown, of British Petroleum, ascribing the entire price increase from $20 per barrel to around $70 per barrel now to military and geopolitical issues. Not one word admitting that his company has been unable to replace existing oil reserves as fast as they are being used. Not one word that other companies are in the same bind. Yes, he plays the "it's the Ay-Rabs fault!" card rather than discussing geologic realities. He doesn't say it directly but he comes close enough and he totally dodges the geologic issues. Unfortunately, while Lord Brown might fool some of the people some of the time, he's not going to fool mother nature ever.
When I look at where we stand certain facts stand out:
1. Despite steadily rising prices, production has remained flat.
2. The IOCs have been dead wrong on every major oil field in the world as to when it would peak.
3. The Hubbert Linearization approach to field analysis has been right almost every time about when a field would peak.
4. The Hubbert Linearization method says the world is near the 50% mark of production.
5. The Hubbert Linearization method says Saudi Arabia is at 58% of production and should begin declining.
6. Saudi Arabian production declined yet again this last month continuing several consecutive months of falling production.
7. Global production remains basically flat for the last 23 months, despite increasing demand.
When I see these data items, plus the complete refusal to address these items by mainstream media or even the president of the US, I see no reason to alter my fundamental pessimism about the future of industrial civilization as it currently exists.
And just for grins, here are more news headlines recently that can give one something to ponder:
Ford admits they may not return to profitability before 2008.
GM slips further into junk status as they are downgraded yet again.
Relevant (and interesting) quote from the above:
My reply to that is: "Welcome to globalization. Kiss your middle class lifestyle goodbye, America."More major American auto plants are closing and set to close over 2006-08, than in the previous three decades.
Stuart Staniford shreds the EIA's piss poor oil forecasts and shows the underlying false political assumptions that drive such blatantly false estimates.
A long technical explanation about why tar sands in Canada are NOT going to save our backsides. (But you Canadians still get a destroyed environment as they rape the area anyway trying to squeeze every last ounce of profit from the sands.)
Dick Durbin (D-IL), Dianne Feinstein (D-CA), Olympia Snowe (R-ME) and Lincoln Chafee (R-RI) are pushing the Ten-in-Ten Fuel Economy Act, which will raise the CAFE standards from 25 mpg to 35 mpg by 2017.
Public transit use is rising with poor people being the worst hit first (of course).
Google provides seed money for the construction of the world's largest solar cell factory. Interestingly, someone noted that this factory will use more than half of all the galium currently mined in the entire world. (The thin film is Copper-Indium-Galium-diSelenide alloy.) I hope these investors have considered from where the galium is coming, or this may be a short-lived investment.
Weekly EIA Petroleum Supply Report
- Total Net Imports are UP 3.6%
- Domestic Production is DOWN -7.1%
- Total Prod Supplied is UP 0.2% at 20.887 Mbpd
Saudi ambassador warns oil prices could triple if Bush uses military force against Iran. Just stop and try to imagine the economic catastrophe that 6 months of $210 per barrel oil would cause. You'd get a first hand look at what a "great depression" looks like and it would be years recovering from it, if we ever did (we almost didn't recover from the last one).
Oil prices are making road repairs too costly to carry out so someone tell me why we are driving cars again?
Someone tackles the truth about ethanol - no, ethanol is not going to save us, Virginia.
Russia moves to strengthen government control over all oil, gas, and minerals. Think the Russians see the multinational corporations for what they really are?
And, when you get past peak oil, you see people really talking about The Most Powerful Force on Earth, and what it is doing to all of us and how it will ultimately destroy everything we hold dear.
Like I said above, my pessimism remains intact if this is how humanity is reacting while it has the resources available. I can only cringe at how it will behave when the resources are not available.