The NPC Report...

"Peak oil" advocates blast U.S. industry study, by Chris Baltimore

WASHINGTON (Reuters) - Proponents of "peak oil" -- the theory that global crude oil production has hit its zenith and is headed for a steep decline -- are steamed with a U.S. oil industry group's findings that the world has plenty of oil.

"In a draft letter to Bodman outlining its findings, the National Petroleum Council says, "The world is not running out of energy resources, but there are accumulating risks to continuing expansion of oil and natural gas production from the conventional sources relied upon historically.""

Well, it's certainly not the hyperbolic gloom and doom we all know so well here on TOD, but, then again, reading between the lines, the NPC report doesn't sound that far off. Certainly many of us would have preferred a stronger statement, but the quotation above isn't exactly telling us to go back to sleep and forget about it.

Those risks include "political hurdles, infrastructure requirements and availability of trained work force," according to the findings of the panel

Reading these lines I think the report is indeed far off the mark.

What about depletion, and all giant fields past peak production? If these truths are in the executive summary obtained by Reuters, then they would also be the headline.

I am greatly disappointed by the leaked contents of this report, but not really surprised given the desire for oil companies to avoid windfall taxation.

I am willing to "frame" peak oil in more than one way.

One way is of course the decline because of geological constraints.

The other is that we moving from the easy to extract to the harder to extract oil. The harder to extract oil takes more resources of all kinds - engineers, special equipment, energy inputs like natural gas, and other resources like water in some cases. At some point, we are not able to continue to expand production because there simply aren't enough inputs to keep raising the amount of oil produced. This latter framing fits more with what the NPC is saying, and may be more understandable to some people.

They are only missing the fine print.

Given these massive investments we will be able to keep production maximized at the geologic decline rate.

They are right, WT export land model (ELM) is right, National Oil companies will invest at even lower rates, and I think a few people are starting to realize that with all three effects are included oil production is lowered by the sum of all three. Considering export land has oil exports effectively going to zero within ten years even with generous error margins we are looking at only 2-3 years at best before facing a major energy crisis.

Btw my wife informed me that we run out of oil by 2010 she heard this on a popular Taiwanese talk show. Just a tidbit but it shows peak oil is getting out ( a bit garbled it seems :)

Consider that the major oil companies assured us that the North Sea would not peak until sometime around 2009, while that doom and gloomer, Matt Simmons, was warning about a North Sea peak in the 1999 time frame. How did that debate turn out?

BTW, why is it that the oil industry has not been able to reverse the production declines in the North Sea and Lower 48?

From the Reuters article:

Daniel Yergin, chairman of oil consultancy Cambridge Energy Research Associates and the panel's vice chairman of demand issues, has dismissed the idea of peak oil.

Instead, Yergin's group has predicted an "undulating plateau" of crude oil production over several decades, followed by a slow decline.

A Golden Oldie From Daniel Yergin, circa 11/04
Digital Rules
Capitalism's Amazing Resilience
Rich Karlgaard, 11.01.04, 12:00 AM ET


. . . where will oil prices be a year from now--$75 a barrel? $100?

Wrong numbers, says Daniel Yergin. Wrong direction, too. Try $38. Yergin knows oil. . . .

. . . Yergin says he's always asked when oil will run out for good. He shrugs. He's willing to say the world will need 40% more oil in 2025. Hard work and technology probably will find a way to meet the demand.

On June 28, 2007, I noted that CNBC was reporting that Yergin had predicted that oil prices would be back down to $60 next year. I suggested that this was a strong buy signal for oil. Brent spot closed a few cents short of $80 today, up 11% in two weeks.

Future news story?

Daniel Yergin, chairman of oil consultancy Cambridge Energy Research Associates, said the recent oil price increase to near $400 was temporary, and predicted that oil prices would fall back to under $200 next year.

BTW, today is the one year anniversary of "Daniel Yergin Day"


You know Yergin knows better than this. This is a deliberate conspiracy to convince the world that it doesn't need to worry about oil depletion.

After it happens and the world is in economic chaos, they'll say it's Russia or Venezuela's fault for not developing more infrastructure.

To what end? What is the purpose of the conspiracy? What are its goals? Who benefits? We seem to throw that word around at every dissenter and government organization under the sun.

If you know its a deliberate conspiracy, then I am deliberately challenging you to explain all of this.

I don't know about conspiracy but the oil companies stand to benefit from reducing the clamour for alternatives. They might well believe that peak is quite some time away but, if they do have that belief, then it most certainly is in their interests to try to convince government that no further investment in alternatives is needed.

Of course, they are also human and, perhaps more than other deniers, have a life that is completely dependent on oil, to a degree that the need to deny a problem is paramount in their minds.

I would not expect an impartial study from oil men. Conspiracy may be too strong a word, however.

I agree conspiracy is probably too strong in general. I think you have two phenomena taking place first these people generally think alike or similar. One reason they are in the positions they are in. I've often found that CEO/Presidents/VP's could almost be clones of each other in my business area. Next the world at the top in any business area is not large its not a huge group of people and the all know and generally associate with each other. The web of personal contact leads to direct dialog on certain issues. This is not a conspiracy simply normal operation of the "good old boy network".

Give the above conditions conspiracy is possible and seen routinely on Wall Street with various trading scandals but its not needed. If you consider the mainstream stance a hidden conspiracy is not needed.

I'm increasingly convinced that the US Government at the highest levels is peak oil aware and has developed extensive plans to deal with peak oil. In some cases the seem to be going awry.

For example we don't see President Bush urging his buddies the Saudi's to produce more oil in fact the have been silent on the matter since 2006. Silence can speak louder than words. So at least for me their is no doubt in my mind that the highest echelons of the governments are very peak oil aware and not happy with what the know. The fact they have chosen to keep this information secret is disturbing. I think that the did not figure out WT ELM model and I suspect the current situation may be a surprise.

Hopefully once peak oil becomes obvious we will find out exactly what was known and when. Maybe if we get a change to Democrats we will see a witch hunt that will uncover some facts. But if we are right then you know that the CIA knows in even better detail the state of the worlds oil supply so this means Bush knows so either we are wrong or he is keeping the real situation secret for some reason probably just to allow the iron triangle to extract the last few bucks out of the masses. We seem to see every indication that the plan is to rev the economy till it explodes.

I'm increasingly convinced that the US Government at the highest levels is peak oil aware and has developed extensive plans to deal with peak oil. In some cases the seem to be going awry.

Look at the bottom of page 2 (of 4pages). Notice that the section Energy Security is completely blanked out.

Did you know about this meeting?
No conspiracy, just no reporting of the obvious.

A Peek Behind Closed Doors

Things are being planned, populations are not being told. Major changes are being put into place. They have a good idea of what's coming and these links are just a few of the planning going on right now on many many different fronts.

No conspiracy. Just news blackout of meeting procedings and results.

The future is already here, it's just not uniformly distributed yet

I don't think that it is a conspiracy per se.

I think that the auto, home and finance guys are focused on selling and financing the next auto and home.

I think that the media guys want to keep selling advertising to the auto/home/finance group.

The oil industry leg of the Iron Triangle is more complex, probably with motives ranging from they actually believe in the Oil Easter Bunny, to fears of punitive taxation and military takeovers (of oil exporters) to a deliberate effort to encourage consumption, discourage conservation and alternative energy and EOT plans.

Basically, the various members of the Iron Triangle seem to think that is a swell idea for Americans to continue to go into debt in order to increase their overall consumption, in effect asserting that an infinite rate of increase in the consumption of a finite energy resource base is no problemo.


You do realize that the traditional use of the term "Iron Triangle" is to describe the military-industrial complex, don't you?

It's a term that's been around forever.

Personally, I believe CERA is a card-carrying member of the military-industrial complex and is being used to keep peak-oil denial in place for as long as possible so that as much wealth can be extracted as possible from consumer society before the big crack-up.

I think Yergin and CERA have been promised a suite of offices right below Halliburton in the Dubai Tower for their help in creating the neocons' new world order.

I've been reading Yergin since 1978. His attacks on peak oil seem way overboard to me.

On Google, my version of the "Iron Triangle" appears to be at #5, and I never claimed to have originated the term.

And your aware that the military industrial complex is especially sensitive to peak oil. They might need for example to go invade the country with large remaining oil reserves to ensure their continued existence.

Right, memmel,

I really think the military-industrial complex sees this a make or break for their survival. I'm sure they read WT's export model with great alarm.

Probably this era of American history will go down as the time that instead of using the nation's wealth to build an alternative-energy future, it was all spent to try to keep the M-I Complex going a few more years.

I just wonder whether that whole crew will just relocate to the Persian Gulf and cut off North America if all this starts to get dicey ... I suppose that's what I'd do.

Yet another Einstein quote:

"When a blind beetle crawls over the surface of a curved branch, it doesn't notice that the track it has covered is indeed curved. I was lucky enough to notice what the beetle didn't notice." --Albert Einstein

"The world is not running out of energy resources, but there are accumulating risks to continuing expansion of oil and natural gas production from the conventional sources relied upon historically..."

Weasel language if I ever heard it. Yes, we have energy resources....but what about oil? And what about those unconventional sources of "oil"?


From the article:

One U.S. oil executive hires people to don chicken suits and hand out flyers at peak oil conferences, calling its advocates "Chicken Littles" - most recently in Italy in 2006.

Their debating tactics are par excellence, are they not? "Why Peak Oil Theory Falls Down", etc etc. An ironic title for a debunking if I've ever seen one--why, why yes, it in fact does fall "down". What dolts. Sort of like how Bush et al named Iraq War '03 OIL, then quickly changed to OIF. I think this may be that similar gymnastic political performance--before the grand finale when it becomes clear to the markets that Houston, we've got a problem.

More of the usual spouting "No geological constraints to see here". Just the terrorists, socialists and "islamofascists" trying to keep oil imports down. Just "security problems"--keep your screens tuned to CNN and FOX News for up to the minute "updates"... Infinite growth putters on forward gasping for air.

Our culture is really a wreak. Our sluggish, mammalian inefficient brains are stuck in "Please lie to me Mr. so I can feel good". It is like a religion of business and politics with a side of American sloth, consumption and waste.

Plus, I love the fact that Reuters adds that line into such a small, banal, frivolous article on such a immensely important issue. Where is our media?

I'm mad as hell and I'm not going to take it anymore. =]

Chicken suits = They are unsure of the situation = They take us seriously.

I'm trying to remember the name of the person who said it, but no one is a partisan about things that are certain.

No one debates whether or not the sun will rise in the morning. And there are no round earth partisans because everyone knows that the earth is a slightly squashed sphere. No one carries round earth signs, no one organizes round earth conferences, no on interrupts strict literalist preacher in congress screaming "Wicked!" Interestingly, there are a few very vocal 'flat earth' partisans and there are a few very vocal pre Copernican 'earth the center of the universe and the sun rotates around it' partisans. But for the most part, unlike religion (which is uncertain and depends on faith), no one has been killed recently because they believe that the earth is a spheroid and revolves around the sun in accordance to the formulas of Kepler, Newton, and Einstein.

When someone is sure about something, they don't even bother debating. Part of the reason that the oildrum is so lively and partisan is because

(1) we don't know for sure for sure how much is left (Thanks OPEC for the sealed books!) and thus we debate what's left and where,

(2) we know that many officials in control of industry and government are lying, ignorant, or deluded (And none of those are positive attributes) as demonstrated by the above article that quotes an official saying peak oil doesn't exist, the supply will just hit a undulating plateau and then permanently decline (I thought that that was peak oil?)


(3) people have different ideas of how the situation will play out (These range from 'Technology Will Save The Day' to the 'Return of YE OLDE WITCHSMELLER' to '12 Monkeys/Gotterdammerung/What's Opera, Doc?').

We do agree that oil production follows a bell curve and that someday soon there are going to have to be changes.

So some oil exec is sending Chicken Littles around. If everyone knew that there was enough oil forever, he or she wouldn't bother. This is a sign that things are uncertain even for them.


All good points... Thanks =]

I'll just reply to one.

lying, ignorant, or deluded

It's the ratios of those, plus a boatload of chance occurrences, that dictate how things will pan out.

I bet'cha the total level of delusion and ignorance, if not more, is right up there with the percentage knowingly lying. Don't forget the distracted--some people are so distracted that it eats into their ability to lie to others or delude themselves.

Hello TODers,

Yep, it is very disappointing that the NPC did not use stronger wording to explain the situation.

On the other hand, Dr. Richard Duncan's Olduvai Gorge Theory is number #2 when you google the word, 'Olduvai'.

Therefore, I think a lot more elementary, high school, and college students are suddenly discovering Peakoil, Overshoot, and Global Warming when assigned any kind of classroom research paper on evolution, early humans, anthropology, and other related topics.

This method is probably spreading Peakoil Outreach much faster than any student and parent awareness of NPC, CERA, DOE, USGS, IEA, EIA, ... and so on.

I am still waiting for GOOGLE to put the 'I Feel Unlucky' button on their search homepage. Hopefully, they will realize the crucial importance of this Peakoil Outreach info-tool before the Grid and Internet go down for good.

Time will tell.

EDIT: Hmmmm, maybe Microsoft will want to be first with this search engine button idea. I believe it would instantly make their search site #1 as billions would go there to check it out. Can the competitive profit motive be harnessed to further spread Peakoil Outreach? How many billions of dollars of free advertising would Microsoft get as the viral word-of-mouth marketing was quickly picked up by the global MSM?

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

I see most of TOD still does not get it. Well, keep tilting at windmills, gang.

And people ask why I am a doomer? Ha!

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

Hello Greyzone,

I am a fast-crash realist too, but as Alan Drake has suggested, "We are bound to fail if we do nothing." We all must give our best efforts to optimize the detritus decline, then ramp up the biosolar alternative to what is ERoEI achievable. Please help to spread Peakoil Outreach as best as you can, thxs.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

I agree. We can at least have a credible plan ready, "To make things not as bad as they would otherwise have been," when it begins to dawn on most of the country that it is unlikely that we will experience an infinite rate of increase in the consumption of a finite energy resource base.

No, Bob, I won't. They've swallowed the blue pill. They do not want to wake up. Leave them be.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

I feel as you do but we must try. I don't want my name to be rightly vilified by history.

Your Name, like the rest of the people here including me will be lost to the sands of time. Might as well sit back and enjoy what we have left instead of wasting energy both human and otherwise to fight the unmovable.

Agreed. We (some of us) must try. I don't think it's for history as much as it is that I have to live with myself. No matter how long I've got, my family has got, I will be doing what I can to fix what I can, to communicate and create ties with my neighbors, near and far, and teach and learn what's possible.

Greyzone is busy taking anything BUT a blue pill, so he can know he never took the blue pill. Best of luck with it.. but if there's room in the boat, I'll pull you guys in and hope you're out there willing to do the same for me.

As far as the 'enjoy the ride' comment.. this IS how I enjoy the ride. This ain't no booze cruise.. it's work, and I like doing good work.

Bob Fiske

GreyZone, I hope you aren't referring to me. Although, tilting windmills is mighty fun. And when you think it through (which you may want to try) these windmills we are "attacking" do indeed "grind the millstone". It's all a PR war, and yeah, your pessimism has much evidence to back it. Still... It is fun to take potshots, ain't it? Alas, when you generalize an offensive like this you should expect some argumentative blowback if you are vague... Nothing personal. Otherwise, in the future, you may want to cite specifics, or reply to someone and outline what you are talking about, instead of crying "doomer"--which I'm sure many here at TOD, you and I would fall into. Talk about shooting yourself in the foot (not that anyone is really paying attention, I grant this to you.) Still I say, a few are. We're here, ummm, right?

We can sit here quoting fiction all day--like CERA, the USGS, the EIA and Don Quixote. The root of the problem is that a decent "discussion about energy and our future" can't take place when there are well endowed, powerful propagandists out there throwing fuel on the fire. It is a media problem. I do agree, that the media probably won't be able to explain the scale of the problem until we get to the problem, because people don't want to hear about, it isn't good for politicians and it is not in the framework of infinite growth economics.

The root of the problem is that a decent "discussion about energy and our future" can't take place when there are well endowed, powerful propagandists out there throwing fuel on the fire.

Why not? Let me answer that from my perspective - your problem is that you are trying or wanting to have this discussion with the entire world. That's your first mistake. The world doesn't want to listen. They don't want to hear that they are approaching the last tree on Easter Island. They just want to cut it down because that is what they are supposed to do according to their cultural religious beliefs.

On the other hand, you can have a fruitful discussion with people who do want to discuss this issue. You just have to find them and engage them. And those are the people with whom you will have the most success in building more than dialog, because if all you are going to do is engage in dialog, then why bother? If peak oil is real and already past or very close, then debating it is not going to change that reality one little bit. You've got to get beyond debate. How far? That's your call. But if all that peak oil means to you is debate and discussion, then we're not even on the same planet, let alone able to communicate.

Ask yourself this - what future do you envision and what have you done to meet that future head on? If you are not taking any concrete actions towards that future, then why are you even here? If this is just a debating club to you, then declare yourself, so that anyone looking for real actions (of any type, doomer or cornucopian) can ignore you. (I am not suggesting that you are here just for debate, mr f, but that was intended as more of a rhetorical remark for everyone reading this.)

This is why I admire Alan Drake. I don't agree with what he is doing because I don't think he can succeed (for political reasons) but I greatly admire that drive that has at least chosen a real path and is doing something with that path. Further, Alan knows the consequences if he fails and acknowledged those consequences yet he pushes onward because it is what he has chosen to do. He is not the only one taking real action, of course, but I suspect that the majority here see this as a debating club. And that is part of why the NPC report should not surprise anyone.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

Hmmm. Maybe you don't get it. Don Quixote was in the minority.

Don Quixote was delusional--a nice guy, but psychotic.

His sidekick, Sancho Panza, had the realistic view on life.

WOOOOAH there, Sailorman!


I'm grinding my way through the 4th Centenary edition right now, and I can report that, at least as far as the end of the Novela Del Curioso Impertinente (Lotario, Anselmo and the rest), Sancho remains as deceived as (because deceived by) the Hidalgo, though perhaps more aware of his own immediate self-interest with regard to food, shelter and sex. Basically the reason Sancho keeps following Don Quixote around through all those losing battles is because he still believes that he will win vast wealth (specifically, the lordship of a tropical island) as the Esquire (Escudero, shield-bearer) of a wealthy knight. Most of the other main characters are pretty grounded, or rather their eccentric behavior is due to social pressure (e.g. Dorotea) or the actions of others (e.g. Cardenio), not their own craziness.

That's just my naive reading, of course. And you can find plenty of other analogies to This Mess We're In. Like Hamlet, the Hidalgo is infinite and immortal. And you get to see the novel being invented as Cervantes goes along.

The weird thing is that so far there has been no detectable reference anywhere in the text to the existence of, or the contemporary world-changing happenings in, the New World. Part I was published in 1605, when the Spanish Empire was the greatest in the world. What's all that about?


Don Quixote was in the minority. Activist peak oilers are in the minority. Don Quixote thought he could accomplish something. Most activist peak oilers think they can accomplish something. I think the parallels are quite clear.

People who want to discuss the other aspects of this know where to find me. From everything I have seen, TOD is not the place for that discussion.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

Well not sure about you guys but these days its not enough to check the price of oil you have to check two prices then go over and see how the dollar is doing to figure out if its the dollar getting hammered or a real price increase.

So if anything the days of easy peak oil discussion are over.

Bingo. This has been bugging me for some time. It seems like it would be beneficial to track oil prices against a basket of currencies. Gee, where have I heard that before? Anyway, It seems like one might be able to establish such a basket and then restate oil prices against it. Thoughts?

Well the movement of the USD down is not huge but it wipes out any gains the exporting countries make via normal investments.

They are getting slaughtered trying to recycle petrodollars into real products simply because they are the last to convert dollars into real goods. In effect they as setting on wads of USD that is losing value big time as they try to reinvest.

This is how the exporting countries lose even though they can increase the nominal dollar amount paid for oil the importers simply print more money to pay for it so they lose.

My best guess is they are running 10-15% inflation rates or higher in converting petrodollars to real goods and services did I mention its a bloodbath ?

The real war being waged right now is via fiat currencies and so far exporters are losing.

Moral of the story is don't sell oil to a customer that prints the money to pay for it.

Good point...isn't Iran asking for payment of Yen only for oil deliveries from one of the Asian countries? How long before Exporters will only deliver petroleum for other "hard" product? Petroleum bartering system. I'm pretty sure Venezuela has already done this with other countries.

I guess and this is getting over my head by getting paid in kind when you export to a particular region i.e use the local currency and not the petrodollar your hedging against a drop in the dollar. Basically most currencies are rising against the dollar so anything but the dollar is a good move.

The US could well be actively intervening in the oil markets also. I'd not be surprised to see Brent get repriced in Euros.

This seems to be a good link.

The result at least for Europeans Japanese and Americans seems to be tough.

American are going to be broke.
Europeans will be ok but with the only stable currency they will have a tough time exporting.
Japanese will either go broke or the Japanese government will have to let the yen increase. This will also give them a tough time exporting.

I think this is why the US wants the Chinese Yuan to free float we can't destroy the dollar as planned with them pegging their currency and they are accumulating so much USD they are a threat since they can control the time line for destroying the USD.

But in the meantime as so many CB are playing with currencies they increasingly have no choice but to increase interest rates to prevent hyperinflation.

I laugh when people talk abuout interest rates lowering in the US. The Fed is working hard to find a reason to raise them again it looks like pumping the stock market is going to give them the excuse they need to increase.

The game right now seems to be who will control when the dollar will crash and it seems to be US/Japan vs China.

Having done almost exactly that as part of my so far futile efforts to escape from wage slavery, I'll tell you that I'm now a convert to the Austrian economic school, which holds that all paper money is eventually just a waste of good paper. Every futures market in tangible goods that I could get data for is currently priced in the 90th historical percentile or higher no matter what fiat currency you price it in. So save yourself some hassle and look at the price of oil in terms of gold and silver, and everything else in terms of gold, silver, and oil.

"Let us wrestle with the ineffable and see if we may not, in fact, eff it after all."
-Dirk Gently, character of the late great Douglas Adams.

Hmm gold prices are manipulated and other metals have industrial uses that drive their prices. Not that gold does not have industrial use but its far less than supply.

In general I'd say gold is probably undervalued at the moment because of dumping by the central banks. A run to gold is a very real threat at the moment. The point is I'm sure we have a real base to make monetary measurements. I've always felt for example that the various ways money is inflation adjusted to compare prices over decades are a bit dubious.

Maybe the price of wheat or milk is a better baseline for real purchasing power ?

I have much faith in the human instinct to survive. My only doubt is the extent to which a corrupted system, part of which is public disinformation, will result in this instinct causing more harm than good under the misdirection of various Big Money malefactors. We must not let media disinformation muddy the waters as our survival is at stake.

I'm not a doomer, but I fully realize that vested interests can corrupt the very conversation we must have as a society to ensure wise decisions are taken. The best decisions for the collective (energy conservation, alternatives such as electrification of transportation powered by renewables and sustainable nuclear, social reorganization away from a petroleum-centric economy) will not be in the best short term interests of those powerful vested parties i.e. the oil-military industrial complex, Cheney's Haliburton, etc..

We must fight the corruption of conversation in the public square! This is the fight of our times and we must not fail. Tell everyone you know about this issue and why, with links to references, the corporate media should NOT be taken seriously.

If only Nostradamus had prophesied "peak oil" or if the book of revelations had a paragraph regarding the declining output of Ghawar...Superstition has a lot of pull with the general public.

We need to keep talking about this issue, as history will probably show that this is THE issue of most importance. In 1980 most people were not freaking out about the looming threat of the year 2000 and the apocalypse that would accompany it. Yet as the day came closer the conversation got bigger. Doesn't the Mayan calender end on 2012? Maybe that will get John Q public to start seeking out the Peak Oil theory as the that year looms closer coupled with oil shocks and fuel rationing. Undoubtedly, someone will cook up some fake Nostradamus prophesy to make it seem unavoidable(9/11)

Our descendants will tell the story of peak oil and the collapse of civilization to their children around the camp fire. They listen as they gaze up at the shadowy faces of forgotten men carved into the rock face of a mountain somewhere in the northern plains of North America.

The truth of the coming crisis will make it's self known one way or another.

Who knows if some of those Quatrains or possibly some of the verses in Revelations could be interpreted to mean 'Peak Oil'. I'd be willing to bet that they have never been studied for interpretation by a person familiar with PO and the interpreter can only 'see' those connections with which he/she is familiar. Another possibility for outreach to a certain segment of the population?

well they made one up about 9-11, why not do the same?

Here you go: At least I think so. It's a bit long, but there seems to be a tie between Armageddon and Peak Oil according to that author.

Let's just think about this framing of the issue...

""Peak oil" advocates"

Do you know anyone who advocates Peak Oil? I don't. If you did "advocate" for Peak Oil, what exactly would you do? Slow the production of new refineries? Peak Oil aware people are not (with some "bring on the apocalypse now exceptions") advocating for the occurrence of peak oil. Just suggesting that there are such people is a form of marginalization because...

1) "Advocates" are seen as people with an axe to grind, a point to make and world to change... which isn't what most folks who speak intelligently about peak oil are about at all, in my experience.

2) The phrase "Peak Oil advocates" suggests that these scary sounding people want something like Peak Oil to happen and are working to make it happen or believe that advocacy on its behalf will change it... which again, is silly, and probably used with exactly the intention to make such people sound silly.

3) Most folks who understand peak oil view it as an oncoming freight train. Do we call people who are pointing to the impending collision "freight train collision advocates"? Of course not.

Preferred, balanced terms might include: "Peak oil analysts...", "peak oil theorists...", "students of peak oil...", and so on.

Of course even those terms should include anybody who has a view on peakoil, whether they consider it a near term or a very long term possibility.

"Peak oil aware" people, or "peak oil conscious" people or "peak oil concerned" people might get closer, but lacks the conflict element that the MSM requires, and that "advocates" delivers, along with all its other misleading implications.

Don't wait around for the MSM to stop using "peak oil advocates" though. When global production finally enters an indisputable decline it will be chocked up to "political factors" for years, until finally the fact of peak oil will become accepted reality and it will simply be called the energy supply situation (or some such), without ever acknowledging who was early in seeing the future, and who denied the likely shape of the future until long after the last minute.


Brilliant. And, wow, that's a nice big Elephant--it's difficult to ignore, even with the wallpaper camo.

Amazing !

No mention of EROI and effect on non conventional oil on the environment and its crazy consumption of other energy sources and water. Also the lack of new discoveries. We need a global awareness campaign, but its not what people want to hear....

Watch that graph on the right go..

What about the economic effects of lots of cheap borrowing, higher risk of environmental and human induced disasters?
What about our unhappy/unhealthy lifestyles being fed to us from our TV?
What about energy based politics? USA - Middle East, Europe - Russia the entire things is a room full of gas, and someone said don't use a torch cos its dangerous, someone is going to light a match to see what is really going on. To phrase a well known Darwin award.

I mostly let these doom fests pass. Today I feel like responding.

The demise of civilization is far from inevitable. Just look at post 1980 period when world oil consumption declined by 20%. It was obviously not the end of the world. The price in current dollar terms was higher then than now. The world had much less alternative technology then as opposed to now.

I personally think these latest set of reports from the EIA and now the NPC overstate the demand for oil at "very" high prices, say above $90, which is a bit above the inflation adjusted high in 1980.

For myself I'm teetering on the edge of converting my car to run on LPG (cost $400 with government rebate) which would cut my fuel bill by a factor of two. I don't because I don't yet want to give up the luggage space for the LPG tank. The vast majority of motorists in Australia are like me. Petrol prices here are around the equivalent of $4.1 per gallon in the USA.

A few weeks ago I did a straight line extrapolation of production fitted in time frame 2001-2004 and extrapolated it to 2007. We're about 6 MB/day below that extrapolation even though the world economy has expanded by over 12% since 2004.

At this time last year I certain Oil prices would be over $100 per barrel by now. We all need to learn. I needed to learn about market dynamics and the adjustments economies make in the face of price pressures.

So the point about this post is that there is plenty of fat that can be squeezed out of Western economies to cope with oil scarcity while alternatives ramp up. Japan is already on a trajectory of expanding economic growth while decreasing their Oil consumption.

I'm with Perry...pull up the lawn chair ...grab a handful of popcorn...and enjoy the show...Game OVER.

You have referred to me as "Perry" at least twice, once here and once a few weeks back at my blog. I do not know any Perry nor am I named Perry. You apparently have me confused with someone else.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

World oil consumption did not decline by 20% in the 1980s.

Here is global production through 2004:

Year World Total
1980 59,557.6
1981 56,049.9
1982 53,453.6
1983 53,256.6
1984 54,498.9
1985 53,966.2
1986 56,198.6
1987 56,626.7
1988 58,691.9
1989 59,791.2
1990 60,491.7
1991 60,187.6
1991 60,115.1
1992 60,167.9
1994 61,039.6
1995 62,332.9
1996 63,697.7
1997 65,688.6
1998 66,915.5
1999 65,848.4
2000 68,368.6
2001 67,983.5
2002 66,967.0
2003 69,234.7
2004 72,223.9

This data is from the EIA's historical series. Now tell me where there was a 20% decline in oil production. The largest decline I see was 10.5% from 1980 to the low of 1983 when production turned back up. This coincided with the worst recession of the 20th century since the Great Depression (1979-1982). And you are comparing a shortfall while production was still climbing and then flat to a 3 year decline that was disastrous economically?

Sir, I think your optimism is misplaced and wholly unjustified.


Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

I think you need the 1979 data point, because that was the high before Iran cut production. The BP data says 66,047 for 1979, or about 4mbpd higher than 1980.

But your point still stands. The 1979 event was a 5% decline over a 4 year period and it had severe consequences. After peak, the decline will be unending for, best case, decades.

Also in 1979 we could shift oil consumption away from electrical power to coal and natural gas. We cannot do that again. Not in the US anyway.

It will come down to rate of decline. Which is why the ELM thread is so popular.

Jon Freise

Analyze Not Fantasize -D. Meadows

I don't feel it's entirely fair to jump on Transition. The comments made are not *entirely* out of line.

Lets admit it, in this country, we throw away energy like it's going out of style. I'd think with even a modest amount of conservation, we'd surprise even ourselves.

That's not to say it's not a drop in the ocean, either.

However, take into account, just things centered around kids. When I grew up in the 70's, if I were bored, my mom would point at my bicycle and say "Go out and play." Today, it's all about trucking kids to sports practices, activities, doctors appointments, you name it. When I was a kid, I walked to the bus stop. Weather terrible? Here's a coat. Now, kids are driven to the bus stop and get to wait in idling vehicles in climate controlled comfort. Cut out that crap and I'd bet one parent could cut gas consumption quite a bit.

How about a fluorescent bulb or two? Or turning the lights or TV after you've left the room? Or hanging one's clothes on a $10 clothes line instead of sticking it in a $1000 dryer?

I'd bet we could make a large dent in consumption with just a minor rise in awareness.

Damac: You said it. The premise that consumption of oil leads to wealth creation is largely unfounded. In the USA, which is no longer an industrial society,the electrical grid is paramount. Transportation fuels is a far distant second. How many posters on this site, for instance, are directly leveraging the use of transportation fuels to make money/increase their wealth? There are some examples, real estate agents, limo drivers, but by and large in 2007 USA transportation fuel consumption is pure consumption, i.e. does not generate income or wealth and a drop in consumption is caused by a drop in wealth, not the other way around.

As Alan Drake frequently points out, because of EOT in the Second World War, it took 400 Swiss citizens to equal the current oil consumption of one American citizen today.

Alan Drake For President!

But your point still stands. The 1979 event was a 5% decline over a 4 year period and it had severe consequences. After peak, the decline will be unending for, best case, decades.

I've said repeatedly that we need only carry the models out till we see a 5% decline before the situation "changes".

Consider all the reinforcing negatives that will effect oil production over the next few years and it fairly obvious we only have a few years before ....

I rest my case.

My appologies. The decline was 12.8% between 1979 and 1984.

I agree that peak oil is very definitely something to be planned for and to be concerned about.

The world today is most definitely not the same as in 1980.

See the exponential world population growth since then for one obvious difference.


You need to learn not to be so credulous--that's all your little story tells about you. Aside from that, the global economy doesn't merely consist of the energy sector--which is just a truism, thanks for stating it. The global economy does depend on increasing capacity to stave off demand... You may want to consider that no one knows for certain when PO strikes. By "PO" I mean we look back and say, "wow, we've lost global capacity to increase supply because production is down X"--lets just say X is over 5mbpd, and no one can point to an above ground black swan. "Squeez[ing] out the fat" is a rank reification if I've ever seen one! Our friends at the AEI and CEI understand that the fat *is* the economy! That's why conservatives love fat and want Michael Moore--I mean more (but yeah, Michael Moore is also fat. Which is odd, you'd think an obese man would feel a bit guilty making a documentary about heath... Perhaps he should have worked out before he made it?) As for "alternatives"--I will just reference you to westexas' post of today:

Specifically, check out the import graph. Did you notice that there is a boiling war over in Iraq before you put 'nother shrimp on the kabob?

The alternatives are always just around the corner, aren't they?

But, respond all you wish... However, my response to your "responding" does sadly incline me (against my better judgment) to acknowledge some truth to GreyZone's "blue pill of pessimism theory"... and say wow, even if long time readers of TOD can't figure it out and pooh-pooh the scale and severity of the implications, than how is random joe-schmoe going to respond, understand and cope? Well, I guess you could be a random joe-schmoe, but then again, aren't we all?

But, you know the only way to really encourage these "doom fests" is to do precisely as you did, which is to bring up strawman LPG (pffft, might work for Mad Maxian Marsupials, but we 'umurikans need gas gas gas gas... read the Hirsch Report lately?), a "sustainable" Japanese economy and the good 'ole "conservation"--also known to real investors as demand destruction (hint, not a good thing, as I'm sure you may have already known). Aside from your tiny "extrapolation" which proves nothing, and your admittance to being a poor judge of the markets resulting in your disappointment because expectations weren't met--how does that at all bear on what many of the "doomers", which seems to be the nasty little word here on TOD even if some try to claim it by taken it as their very own (getting the equivalent derision perhaps only the word "liberal" in society at large) I'm just not clear that you address any real evidence that the supposed "doomers" during their "fests" make a pretty strong case for.

Actually the "blue pill" is blissful unawareness. It's the red pill that is reality. ;)

"This is your last chance. After this, there is no turning back. You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes." -- Morpheus, The Matrix, 1999

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

Actually the Blue pill is placebo. If you swallow it, no change occurs to your internal mental model of how the world works.

On the other hand, by swallowing the Red pill you add a new level of complexity to your world model. The world of the Mr. Smiths continues to exist. You just now see it as one of many worlds and therefore one that by itself is no longer a "complete" explanation of the Universe.

Park that response closer to my house. I can further decrease my utility bills by harnessing the heat radiating from it's surface. Seriously, conservation by itself is not the whole answer, but it is a layer in the PO onion that that will be addressed whether forcefully or voluntarily.

I just hate that when energy concerns come up in the news the canned response is to click that thermostat down a notch or 5, turn off the porch light, turn off idling cars, etc etc. Our entire economy and industry are centered on cheap transport fuels to move cheap crap from china and food grown on the other side of the planet to you local strip mall or walmart. Sure, turn down those dials and work out more while riding that bike. but to use a popular quote "When the trucks stop America stops"...but you will have lost a few pounds and saved 10 dollars. No matter how much you conserve the government will spend that remaining energy balance and them some for you as long as it is business as usual. The War we are in probably canceled out any efforts that regular Americans were trying to reduce in usage.

The media needs to be pushing people to vote correctly on the issues that will make us implode when the diesel stops flowing. We need to rebuild the brain trust, get more of our exported industry back into local communities, teach more useful skills in schools, etc. Bah, now I am venting. Time for bed time. Mr. f is right, upgrading your light bulbs does not save the world unless the world wants to be saved.

I should know better than to use inflammatory words. My apologies.

I agree that the decline in oil production was not 20%, it was 12.8% from 1979 to 1984 according to the BP review.

I wanted to point out where I've been wrong. How many other people were here last year and were certain prices would be much higher by now?

I know there is no magic bullet that will solve everything in one hit. That is not to say that there aren't of things that will make a difference as we go down in crude Oil production, (which still stands at all time high in mid-2005).

I spend a lot of time in Japan and I can assure you things are looking better there than they have for some time. Oil consumption in Japan declined by 3.7% between 2005 and 2006 according to the BP review. I think economic growth a bit over 2% in 2006 but I can't find an authoritative link.

Overall, from the BP data, world oil consumption increased by 0.7% between 2005 and 2006, meanwhile world economic growth was over 4.5%. The projections for 2007 is for economic growth of over 5%.

I don't think we do the cause of raising of Peak Oil awareness and the long term necessity of switching from fossil fuels, any good by ignoring the fact that overall, the world economy is doing pretty well, even though crude oil production was at a maximum 2 years ago.

Japan GDP Growth:

2006 2.2%
2007 2.7% (projected)

The Economist has a fairly nice country profiles/briefings with recent data:

Professor Goose posted this as a separate thread. I'd really like to get inside his head and hear what he thinks of all this, and especially what he personally believes about public activism at this point. He's dropped hints over the last few years that make me think the good Professor is a great deal more pessimistic than most of those who write for him.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

From another Reuters article the report leak mentioned two incompatible quotes:

The world is not running out of crude oil and natural gas

The group calls for "a new assessment of the global oil and natural gas endowment and resources to provide more current data for the continuing debate."

On the one hand, the report is saying, unequivocally, that the world is not running out of oil and gas. On the other hand, it is saying that the data are poor. If the data are poor, then it cannot conclude that the world is not running out of oil and gas.

If these quotes are an accurate reflection of the report, it isn't worth the paper it is written on.

"We're disappointed."

So the words of Roscoe Bartlett seem to sum up the "Peak OIl" contingent's discontent with the tone of the new NPC Report, or at least with the report as it is being leaked out drip at a time.

The question is exactly what the peak aware community is disappointed in. Is it that the NPC Report does not endorse peak in the way that the peak community has long explained it, i.e., a geological peak, per M. King Hubbert in which the emergency will be that the oil and gas is simply not in the ground in the volume or at the pressure to maintain production growth?

Or is the peak community disappointed in that they believe the NPC Report is simply not correct or candid?

It is of course possible to face a grave oil emergency without Hubbert Peak. This would be what I have explained as the Total Oil chief Christophe de Margerie peak theory, i.e, the oil is "out there" but simply not in the places we are allowed to develop it, and even if we could, we cannot bring the money, labor and talent and machinery to bear fast enough to avoid a major supply crunch.

The difference between Hubbert Peak and de Margerie Peak is simple: With the Hubbert Peak, the oil game is essentially in terminal decline. There can be no rescue, no amount of effort will return world production to it's prior peak levels.

With the De Margerie Peak, there would be hope. It may be grasping at straws, but one could hope that if enough money and effort wree expended fast enough, and an amazing "awakening" of world political cooperation were to occur, the oil era of increasing production and consumption could be continued.

The NPC Report as it is being released in fits and starts, seems to be endorsing the De Margerie Peak. This could be somewhat expected, given the report is in the most part authored by people with a vested interest in the oil and gas business. No insider wants to admit to the decline of an industry to which they have given so many years and so much effort.

But, as Bartlett says, "We're disappointed" if we feel that the NPC would bend and or hide the truth, no matter how unpleasant that truth may be, simply to stretch the "golden age" of oil just a tad bit longer. If this was their motivation in constructing the report as it is constructed, then it would be a sad commentary, and end the credibility of the organization.

However, we have to accept another possibility: The NPC and De Margerie may be correct. The oil crisis could, as it was in the 1970's, once again be a logistical/geopolitical issue and not a geological one. Once more, we could get a last minute pardon...and...then what?

We wait for our execution on another day? We continue to spew out carbon at astounding rates to see if it really will turn the Earth into a pole to pole tropical zone? We continue to pour our money up the stacks and out the tailpipe, by transit of nations far away, who use our own money to murder us?
We continue to prostitute our destiny away buying the "devil's tears", while we waste the 8 megawatts per acre available to us from sunlight? While we build 4500 pound devices to carry a 180 pound creature?

Just in the last day or so, there was actually an article about the price of natural gas, and how it was ending the "wasteful practice" of flaring natural gas. So our barbarian rituals continue. Flaring gas? In this day and age?
I once made the argument that the only thing that would be worse than the oil and gas not being "out there" somewhere is if it actually is out there in vast volumes. Humans will need some oil, some natural gas, for use in those processes that cannot be completed in any other way. Burning it is not one of them. But it seems that as long as there is a drop left, humans would rather burn it that salvage it, even if it means burning it ritualistically up a flarestack, to no productive use whatsoever. This is not a problem of science or physics. We CHOOSE this problem. Each time I hears stories like the above, I am less frightened of the prospect of a "dark age", as I realize we are already in one.
"I'm disappointed."

Roger Conner Jr.
Remember, we are only one cubic mile from freedom

I totally agree with living off solar income. But where do you get your 8.0 MW/acre from? My calcs show between 4.0 and 6.4 MW/acre. Also, from Wikipedia:Insolation:

"Long-term time-averaged irradiance in Sunny locations is closer to 250 watts per square meter, taking into account the lower radiation intensity in early morning and evening, and the presence of night."

This would be about 1.0 MW per acre averaged over 24 hours.

Available wind energy is substantial too, larger turbines can generate more energy from the same land space, also the larger turbines have greater inertia and the output is less variable when many turbines are used over a large area.

Renewables and Nukes - F**K YEAH
Shame about the copper
Whoever is working on the superconducting nano wire transmission lines would they mind hurrying up?

JN2 asks

I back averaged from claims made recently by announced solar farm planners:

“ The 80-megawatt farm is to occupy as much as 640 acres and upon completion in 2011 will be 17 times the size of the largest U.S. solar farm, said Cleantech America LLC, a privately held 2-year-old company.”

Of course, this is a "claim" by the promoters so it may be high, and we have to remember that this is California, so the location would be above the average. I will readily accept your 6.4 number as closer to correct (4 per acre seems low to me, but that is just a hunch on my part)

Thanks for the source, I have not found it easy to get a reliable number. I would love to see a few different systems (the old silicon crystal type, the newer flat panel Copper Indium Selenium type, and a concentrating mirror type) of some 100 square yards placed next to each other to see the results, sort of a "solar drag race"! Either way, I would love to see the megawatt per acre calc applied to see how well biofuels and ethanol would fare!

Roger Conner Jr.
Remember, we are only one cubic mile from freedom

This would be about 1.0 MW per acre averaged over 24 hours.

This is significant. This document also mentions the average 250 watts per square metre (averaged out over every minute of every year). So the most one could achieve, on average, is 1.0 MW per acre, on average. Probably 4 times that at peak times, but not on average. Assuming an efficiency of 20%, in converting that to power, this means that 5 acres would be needed to generate just 1 MW, on average.

As my sister who is a reading recovery specialist always says “you have to teach from what the student already knows and expand from there”.

I agree that the message will/is being "Managed".

What the NPC report says essentially is that WT's ELM is far more important than the geological realities and I don't disagree.

It’s enough that message of sever global energy constraints for the foreseeable future is being delivered.

P.S. For any who have not already seen it I recommend the BBC doc.

The Century of the Self

The best documentary ever!! A masterpiece from BBC4 that shows the reality of the american identity !!

Long 4 part series but you will have a better understanding for how TPTB “ engineer consent”.

My bad...

I still agree with you...and I read you here:

Nonetheless...pass the popcorn please.

If big oil has enough oil perhaps they do not have enough deep sea drilling rigs.

The rig utilization rate was very high. Some were down for maintenance or in transit between basins; or simply asking for outrageous day rates.

In the lower tertiary of the GOM are probably tens of billions of barrels of OIP. It takes four months to drill a well to 30,000 feet below surface and then you might get 6,000 barrels a day. Some wells this deep have produced oil in Oklahoma, but mainly they extracted gas from that depth, because usually you do not find any oil that deep. If you have full rig utilization and production is not growing, what will happen once the bonanza prospects become fewer and fewer? The shipyards are busy building semisubs. It is not easy to sustain 84 million barrels a day when production per well seems to be dropping in some areas as they drilled more wells into the same declining fields and turned to low yielding formations where production might be 150 barrels a day initial production dropping to about 50 barrels a day within a year. Feet drilled per barrel of oil produced is high in some new fields. Tar is a sticky mess. It requires extra refining in order to upgrade it or recycle the dilutents used to transport it. This affectively draws down refinery capacity in the short term. If one guesses wrong and builds too many refineries at peak oil, there might be angry stockholders claiming mismanagement, and calling for corporate regime changes.

Correct and the detractors of peak oil and probably export land once it becomes public will claim that these problems are why oil production is declining. If we had more money and people we could increase production.

The reality is these problems will probably result in real decline rates to be greater than that predicted by the geologic models and export land. So at best if above ground factors where not present you would get the decline rate that export land predicts.

Considering the prediction that export land makes which is a 50% drop in exports in five years the fact that the oil industry is claiming serious above ground problems is alarming. To me it looks like the oil industry will effectively suffer a meltdown over the next few years.

And they probably won't ever except why. As far as historical precedence you can look to Texas. People claim that the Texas oil industry collapsed because of cheap oil but the total model indicates that it collapsed because they spent a lot of money and did not find any more oil i.e the could not increase production despite massive investment.

I expect the world production to follow exactly the same collapse route as Texas did with a lot of extractable oil abandoned as cost escalate and projects are canceled and the world economy starts to stutter making prices highly volatile. We could well see 40 dollar oil again but it won't be a good thing.

Found this at RigZone:

Angola might get an OPEC quota ceiling next year.