£1 per Litre Petrol Drives Peak Oil on Mainstream TV

On Wednesday 7th November 2007 the mainstream 10:30pm ITV news in the UK discusses the "peak oil" documentary Crude Awakening, hears the IEA warning of much higher oil prices, shows how many countries have already peaked and speaks to David Strahan (lastoilshock.com).

In the UK, today's coverage has been driven by the psychological £1 per litre being crossed for the first time (BBC News). Crossing the other threshold of $100 oil, will likely drive further peak oil discussions in the mainstream.

Just yesterday Euan highlighted recent coverage of Peak Oil in the Mainstream Business Press.

Also see: A Tuppence Extra? for more on the UK petrol pricing.

Can anyone shed any light on where they've got the number of 122 million barrels forecast demand by 2015 (which is the number claimed in the graphic and by the newscaster). This seems waaaay off any sensible projection - the IEA's Medium Term Oil Market Report (as released in July) forecasts demand of 95.8 million barrels by 2012 (it doesn't go out further than that). This is clearly not in sync with 122 by 2015. Or, looked at another way - to go from 85 million barrels to 122 million barrels in 8 years (2015 being only 8 years away!) would require an annual growth rate of 4.6%. This does not seem credible either - not even consdering whether that amount would be AVAILABLE, it doesn't seem sensible as a demand forecast.

Perhaps they meant 2025?

Shame to see such a glaring error in the UK mainstream TV's debut of the Peak Oil Threat!


The IEA publish a number of scenarios, I suspect the 122 Mb figure is from the High Growth scenario.

Hi Bob,
No - it doesn't even seem to fit that bill - oil demand in the High Scenario in 2015 is something like 100 mm bbls (from memory - I read it earlier today but can't find the place I read it). I think the number is actually a 2025 number in the High Growth scenario


Could be, I am pretty confused now, I have seen all sorts of numbers floating about.

We need someone to get that report!

BTW, The executive summary is here [pdf].

Here is my interpretation of what is wrong with the numbers in that presentation: Currently we use say 86Mbpd. They came up with 122Mbpd by 2015. That's in 7 years. So the magic number here is 37Mbpd. This can't be the amount of demand growth expect as it's over 5Mbpd per year, if averaged. Seems pretty unlikely. Lets say 102Mbpd is more likely, given IEA forecast about 96 Mbpd in 2012. That is 16Mbpd more than we use now.
And here is the key: declines in production from existing Fields in Production. At say 4% per year thats in the ballpark of about 3 Mbpd per year so we will lose 21 Mbpd of production in that time.

So, hey presto, come 2015 we need 16 + 21 = 37Mbpd of NEW production to just get us to 102Mbpd in 2015. By mistake, whoever wrote the number for that piece has simply added the 37 to 85 and forgotten to subtract the 21. [These are very rough numbers I have used just to illustrate the point]

Hi TheMagus,

Really good interpretation. I hope the program researcher/writer is reading TOD. Perhaps they will issue a correction - along with an explanation.

One thing (of several) that bothered me about the presentation re: all those "green" (was it?) countries not yet in decline - there was no explanation of the relative amounts produced by those in decline v. those yet to roll over.

If we assume that the final peak was actually in 2005, then by 2015 (just 7 years away), even if it is a flat-plateau type peak as some hyper-optimists claim we are going to get, that shows a shortfall of ~20mbd in total liquids for a world BAU economic scenario (around a 20% shortfall!!!)

We are already around 5mbd below an IEA BAU scenario, there must be recession somewhere in the world ... no wonder Birol is starting to sweat!

BTW, peak total liquids is not the problem ... peak 'net-exports' is!!!

When MSM, and especially politicians, start talking 'net exports' then I'll know we're getting somewhere - you can't even start to fix a problem until you define exactly what it is.

But the MSM don't understand that even net exports is but one symptom of a much bigger problem ... when will we see that mentioned?


This just in:
That's one green country that might be greener still.

This find closely follows the trend, significantly more difficult to get to.

The Tupi field lies under 2,140 meters (7,060 feet) of water, more than 3,000 meters (almost 10,000 feet) of sand and rocks, and then another 2,000-meter (6,600-foot) thick layer of salt.

It might fuel the world for another 60 days or so - heroic engineering though - very nearly a depth of four and a half miles!


there was no explanation of the relative amounts produced by those in decline v. those yet to roll over.

According to EIA statistics ... http://www.eia.doe.gov/emeu/cabs/topworldtables1_2.htm

in 2006 ...

there were ...
42 'net exporters', with average total exports of 45.424 mpd

of these ...
35 have either peaked or are at a peak plateau, producing on average 37.240 mpd

that leaves ...
just 7 countries that are yet to peak, producing on average 8.184 mbd

The top 16 make up 90% of total net exports and their exports peaked in 2005.


In the two years or so since peak their net exports have declined about 5%

Between 2000 and 2006 the production of the 171 'net importer' countries fell 4.2% to 20.872 mpd

Any net growth in production (for BAU around 2% is required) will first have to counter the 'net importer' declines and the 'net exporter' declines.

IMO the most likely place for adequate future growth (if any) is likely to come from countries where current adverse 'above ground' factors are removed or from the 7 'net export' countries yet to peak.

The 7 are:

United Arab Emirates, Libya, Angola, Kazakhstan, Canada,Azerbaijan and Cote d'Ivoire (Ivory Coast).


Thanks Xeroid,

This is very nice and succint.

Don't know where they got that (and I looked) but I suspect it's another outdated B.S. estimate by IEA forecasting a "50% growth in demand by 2015" or some such nonsense.

This falls in line nicely with item #877 from the November newsletter from ASPO-Ireland (Campbell), which addressed the "Appalling Ignorance by the British Government" over peak oil. Apparently they are still referencing a 2005 IEA report asserting that supply will continue to meet demand...even after IEA has admitted in its 2007 report that supply will likely not meet demand. Campbell suggests that rather than a deliberate attempt to mislead, this is in fact a "doctrinaire flat-earth ignorance" on the part of the British government.

Energy consultant, writer, blogger www.getreallist.com

Chris - a fanastic job getting this on line so fast. Watching it again it is a really good report. The next stage is to get the reporters to think about what the consequences might be for BAU scenarios. Worth noting that the BBC explained away £1 a liter by 3 factors:

1. growing demand in china
2. the falling $
3. speculation

We need email addresses for the BBC reporters so that we can send them our views - this is the biggest story of the 21st century after all.

They are really hard to find but the BBC does have reports on PO


BBC are somewhat conservative, but they are willing to entertain new ideas. They ran a piece by John Feeney on population in their Green Room section. I think the BBC have PO bubbling under the surface, and are waiting for official confirmation before making it headline news. Unfortunately Fatih Birol explicitly said that this is not Peak Oil.

David Strahan author of Last Oil Shock is a former BBC journalist. I guess he would have a better chance than most of persuading them to make PO a headline topic.

Fatih Birol appears to the critical cork in the bottle though. Birol is good at spin though, he says "there is sufficient oil, if necessary investments are made". The headline writers take the first part and ignore the if. He should say "we will run short of oil, unless sufficient investment is made" which would have proper impact.

Hi Bob,

Yes, indeed: "...if necessary investments are made"

Investments in: large-scale conservation, immediate implementation of policies to address population growth (legal rights of women), huge investments in wind/solar to avoid Olduvai - and etc.

Maybe not the type of investments Fatih has in mind. Still, perhaps he does know, in the back of his mind.

I wonder what it would feel like to be in his position. (Note to Mr. Birol: Perhaps better to address it now.)

The BBC had a report on Newsnight yesterday - I didn't see it but the summary is here


There is a view again option on Newsnight homepage.

I watched it. Talking heads mainly.

An analysis - short film by Newsnight guy - kinda following recieved wisdom.

Leggett, Porritt and a Harvard economist quizzed in studio by Paxo.

All as expected - Leggett strident - got in 'PO about now' and more than recession soon, looked genuinely agitated. Porritt dithering and CO2 obseessed - but aware. Economist away with the economic faeries, denying peak oil as price sorts it all out, talking bollocks about transition from whale oil. However, economist was scared by tranfer of 'power' to NOCs(bad!) rather than IOCs(good). Imports not mentioned.

Not decisive - but out there in Mainsteam Media.

Tonight on Cris Matthews on MSNBC he interviewed the Market guru Kramer. I was pleased to hear straight talk. We have a big big problem that will not go away. We need more Nuclear plants and soon. It was all in line with TOD thinking. Oil production declining and higher pricing going forward. Najor action is needed.

Peak Oil was also the topic of a feature article at seekingalpha.com, a popular investment site, back in May. It also is all in line with TOD thinking, on its major points anyway. It is an excellent overview of global oil, EROEI, and the major oil alternatives, one of the best I've read outside the confines of peak oil books and websites. You can read it here

theMagus: Good numbers. Given the mathematical (in)ability of the journalistic profession that seems a pretty plausible explanation. The number that I think is relevant is the ratio of (nominal) demand to supply, as I think this number will determine the price. By nominal demand I mean demand at some arbitrary, but fixed price. Leaving out the effect of inventory builds/drawdowns the ratio of demand to supply at the time varying price should be one. So lets assume $90oil gives us a ratio of 1. If we end up with nominal demand of
say 110 and supply of say 75 the ratio becomes 1.46. Depending upon the elasticity of demand one could estimate a market clearing price. I don't know the elasticity, so I will leave it to the oil economists to estimate the future price trend.

On BBC Five Live I heard an interview with Ray McCormack who is one of the directors behind a new documentary about "the oil crash" called "A Crude Awakening".

It was in their chirpy and cheerly slot called "wake up to money". However, this morning they had difficulty being cheerful and optimistic as all the market numbers were so disturbing. The financial journalists just don't understand the true extent or consequences of the US financial meltdown, but that's another story!

Anyway, for the first time I heard them mention "Peak Oil Theory". An historic moment! For them Peak Oil is a strangely confusing concept. Well, as they said to Ray McCormack, we not going to run out of oil tomorrow are we? No, that's not what it means, it means were are going to start running out of oil. Oil production will have reached a peak. It will then start to decline, slowly, but inexorably.

One of the journalists remembered the early seventies when he was a kid, and oil prices rose dramatically, and people said we were being squeezed, what's the difference now? McCormack replied that the Arab oil embargo was political, whereas this time it's different. We are entering an era of scarcity.

But there's there's Canada! Canada has an area the size of Florida and five hundred feet thick which is full of oil! McCormack replied gently that this was mainly tar mixed with sand, not oil, and we'd probably only extract a maximum of three million barrels a day from Alberta, and we're currently consuming 85 million barrels a day, which is a huge ammount.

The two journalists seemed rather disconserted by his answers, as well they should be, once one begins to examine and think about the consequences of Peak Oil one's perceptions change.

Finally one of them said, and what I want to know is, what happens when the oil does run out, do we go back to living like cave men? I hope not, McCormack replied in his calm, irish voice.

Obviously is good that this subject is finally pushing it's way into the MSM, only the above interview does illustrate the level of ignorance and the tremendous task of re-education that's going to be necessary. I think Peak Oil is going to develope into a very "political" question, because it has the potential to undermine our belief in the ability of the "free market" to provide for our longterm well-being.

Hi Guys,

You can download the mp3 podcast thingy here...


select show - 9th Oct 07, Crude Awakening.

For them Peak Oil is a strangely confusing concept. Well, as they said to Ray McCormack, we not going to run out of oil tomorrow are we? No, that's not what it means, it means were are going to start running out of oil. Oil production will have reached a peak.

I have been trying to find a metaphor for oil production that will get the intuitive idea quickly.

The best one I have is the idea of tipping a 1 gallon jug of milk on its side. The milk first gushes out, then pours, then trickles, then stops.

But, they say, you just tip up the jug and it gushes again. Sigh. The trick is that there is no everyday experience where a fluid flow follows a bell curve. It just does not happen. We have designed it not to happen. Instead we design every container to flow until it runs out. Anyway, if anyone has a good suggestion, I would like to hear it.

Jon Freise
Analyze Not Fantasize -D. Meadows

The trick is that there is no everyday experience where a fluid flow follows a bell curve. It just does not happen. We have designed it not to happen.

That is a good point, after 3 years I have not found any good analogy either. To make a close equivalent you have to set up a contrived example, which requires so much explanation you may as well explain how oil reservoirs work.

If people don't get a simple analogy like picking apples, or sucking water out of a sponge immediately, I just move an explain that we are using far more oil than we are discovering etc.

When people get that blank "oh my god" look, it is best to fill it with positive ideas about renewables and efficiency. If you leave people with nothing, they tend to switch off.

PO is fundamentally counterintuitive, people are used to the idea that putting more effort in always produces a greater result. At least in the future, we can say "it will peak, like oil did"...

Best I've come up with is slurping a thick milkshake through a too short straw, with lots of ice in the bottom of the cup.

  • At first you get little and its hard work with lots of sucking.
  • After a while it reaches a steady state and you suck up the more liquid milkshake.
  • Then you get left with the more solid bits and you have to stir the straw around to make it melted enough to slurp.
  • If you want to get more out its no good sucking harder, you have to stick more straws in.
  • As you reach towards the bottom half of the cup you have to manoeuvre the straw to suck out what's left between the ice. You get less out, it more effort, and what you do get is mixed with water and not as nice.
  • Eventually your straw isn't long enough and you can't reach the last bit no matter how much you suck.

Not perfect, but the best metaphor I could come up with.

That IS a good analogy. Even has the water mix. I did, however, kind of have a Homer Simpson reaction to it at a visceral level.

(This is NOT a real Simpsons (R) (TM) scene..)

Mo: Homer, climate change is, is -- wel it's like this chocolate easter bunny.. if you get it too warm (lights blowtorch), YES, it's nice and warm, but it DIES, Homer, it DIES! (Bunny and Bar catch fire)

Homer: Mmmm, Chocolate!

~ But maybe that's just me!


Better than mine. I'd thought of a big plastic soft drink bottle drunk through a straw (that doesn't reach all the way down)

At first, it's just you.

Then a few friends come along, each sticking their straw in. There will probably be a maximum of 5 people able to get round the bottle. (Four round the edge, and the fifth squeezing in the middle). The fifth straw doesn't reach as far as the others, but, initially, it doesn't matter.

When the level drops, the fifth person can no longer drink, so takes their straw. The bottle has just peaked.

The four remaining people continue to drink, until the level drops and they can't drink any more. However, if the bottle was tilted, then the straw would reach. But the bottle can't be tilted while four straws (and four people) are still round it, so two of them leave.

The bottle is tilted, and the two people remaining (you and a friend) get to drink some more. The level drops, and they can't drink any more. The friend leaves.

You then can lift the bottle off the table, and drink a bit more. Eventually, though, your straw still can't reach the last dregs (unless you are prepared to tilt the bottle even more, and let it trickle through the straw very, very slowly).

As I said, I think your version was more succinct.

Do the same trick with a punctured watermelon?

Hi Jon,

Interesting question. I used to try to use metaphors, but I've found that the best thing is just straight, plain talk (as best I can manage.)

It might be a better use of words and "airtime" to talk a little about history. What is the difference between "then" - say a hundred years ago - and "now"? How did we get to have so many people? What actually causes global warming anyway?

This latter question, coincidentally, lifted from a conversation of a few minutes ago:
Earnest young man: Uh.well...humans.
Ani: How do we cause it?
Earnest: Well...our emissions...
Ani: Where do those emissions come from?

"How did we get to have so many people?"

Another TOD item claimed that men are responsible for most of the CO2 emissions.

It would appear that the root cause (sic)of all global problems is "male emissions".


Well, perhaps something was lost in the re-telling. Kind of the point I was getting at - a lot of people have seen "Inconvenient Truth" and either not gotten the message from the movie (perhaps because it was not there?) or not thought to ask - "Why? How is it that humans are causing global warming?" - in the sense of - burning fossil fuels. I don't know...just seems like some major pieces of the picture are missing, somehow: fossil fuel consumption, economic growth...

Wasn't the movie's main contention that science tells us we have a problem, but our ingenuity will solve it if we work on it and change our light bulbs and conserve perhaps better than the movie's star, and business will be able to go on as usual somehow? Another message for me was that a movie without co-stars can get to be tedious when the star says the words "I" and "me" over 80 times.

That may be a little harsh. I suppose it is worthwhile that the inconvenience brought up was a topic that is or could be threatening our species' survival, and done in a way that everybody wanted to see it.

But the message didn't change many people for more than a few weeks if even that. Once people return to their day to day life, everything seems "normal" again. Time for the next entertainment. Maybe something less serious for the followup show.


Keep believing that the sky is falling. Those who control the flow control the news. Think folks. If you knew Carbon was the most common mass on earth would you keep buying diamonds? Google that.

Crooks own what is "supposed" to run the world. Good god we can't grow crops without it! Except for those first few hundred crop growing years.

What kind of B.S. is this latest "validation" of the Peak? BBC? No. Maybe MI5/6.

Peak oil is the propaganda of keeping the poor, poor. For crushing you sad middle class folks. Keeping the indebted in debt. Keeping the cheep soldiers fighting illegal wars.

What a bunch of B.S.

Keep up the great work Oil Drum. Keep up the propaganda. Keep these poor folk scared and unfocused. This is a top star CIA site.

Good night and good luck.

Looking forward to being banded for my opposing view, regards Bill

Cheep is spelt 'cheap'

Richard C

Welcome Bill.

Most of the posters here at The Oil Drum have spent a few years understanding the concepts surrounding oil production and depletion. Many are engineers or scientists and well versed in the scientific method.

Why don't you spend some time understanding the data supporting the peak oil theory and oil production? Use the FAQ links at top of the main Oil Drum site. Read a book on the topic. I recommend Deffeyes' "Hubbert's Peak" or his "Beyond Oil".

When you have brushed up on the concepts, download the data sets for yourself and try modeling them. There is nothing like trying to duplicate an experiment for ascertaining the truth, is there?

If, at the end of that effort, you feel the theory of peak oil is unfounded, please do come back with a detailed critique backed by data and logic. You would then find a warm welcome. Such critiques are why this site exists.

Best of luck in your search for the truth.

Jon Freise
Analyze Not Fantasize -D. Meadows

If you knew Carbon was the most common mass on earth would you keep buying diamonds? Google that.

I don't know what your point is, but does it matter that carbon is not the most common element by mass? It doesn't even make the top 10.

Troll: someone who intentionally posts controversial or contrary messages in an on-line community such as an on-line discussion forum or group with the intention of baiting users into an argumentative response.

B: If TOD is a CIA site, I agree that it is top-notch. In fact, if those guys have sharpened up their act that much, maybe I will look for a spot at the company. If you can't beat them, join them.

'Looking forward to being banded for my opposing view'

Having followed this site for short while now I, for one, welcome a dissenting voice.

But rather than claiming that the Peak Oil theory is bullsh*te and all here are CIA spooks could express your reasoning?

Peak Oil is more than a hypothesis, because it makes testable predictions. One takes the known data ( yes there are also unknowns ) and extrapolates. I consider statements made by people much more knowledgable than me and then consider the available information and their provenance.

For example; Peak Oil - Yes, Anthropomorphic Climate Change - No.

There will always be oil, for those that can afford to pay for it; the super rich, big companies and gummints. In the UK a litre of petrol is now £1.02, approx £4.64 a gallon. What would the economy look like when a gallon is £10 or £20 or £100?

My understanding so far is this; Global Peak Oil occurred in 2006/2007, supply will continue until 2010 at roughly 85M barrels per day, output will decline at around 4% per year thereafter, price will tend to follow a wobbly trend ever upwards. Poorer countries are already feeling the effect of higher oil prices. The economic effects will slowly ripple out, combined with other random events and human nature the situation would be ... difficult.

I am not an advocate for the Precautionary Principle ( which in its original form states: You might as well believe in God, for if He exists He will be pleased, if you disbelieve and He exists you will go to hell forever, if He doesnt exist after all, what harm is there living a virtuous life?) but I would feel foolish having taken no mitigating action and there were indeed severe economic problems.

Fare thee well sir.

Its not our abilities that define us, but our choices.
Albus Dumbledore.

Anthropomorphic climate change?! Wow, what an inspiring concept! :-D I suppose you could say CC is a real bastard.

Perhaps you meant anthropogenic...?

Whoopsy, of course, Anthropogenic.

Too much Terry Pratchett.

Its not our abilities that define us, but our choices.
Albus Dumbledore.

Yeah, but give the Japanese film industry a few years, and I bet they'll come up with a fine AnthropoMegaMorphoMonster movie franchise that illustrates CC pretty well.

Gaia-zilla is my vote!


Since you mentioned Anime, here's my background music to the Peak Oil EcoCollapse..



Its not our abilities that define us, but our choices.
Albus Dumbledore.

If the CIA is paying, please tell me where to send in my invoice.I could be much better at keeping people scared and unfocused with a nice expense account!
(sarcanol alert)

I guess that fear of the unknown that makes certain numbers significant, a numerology projected onto the peak. $8 a gallon would not resonate with Americans very much, but $100 a barrel does and $5 a gallon will with the Americans.
The psychology is obviously the interesting thing, Brittish prices are twice that of the US without causing a collapse-although I haven't been over lately,are you living in caves yet?

"You speak a lot of sense for an Oilman, Mark!"
- Local Hero, 1982

Petrol here ( Wales ) is £1.02 a litre, £4.64 a gal, been hovering around 98p for the past few months.

Despite the media interest most people aren't that bothered about the price, a quick curse then 'oh well', the car still needs petrol.

75% of the price is fuel duty and tax, I suspect there is some leeway in tweaking the pump price to stop motorists getting too annoyed.

Its not our abilities that define us, but our choices.
Albus Dumbledore.


I hope exposing TOD made you feel like a big bad brave man. I mean coming on to a CIA site and speaking truth to power like that? Yep, you the man now!!!

It's a shame that by the time you read this there will be some gray aliens jamming instruments far - and I do mean FAR - up you ass. That'll teach you to a thing or two about sticking your nose where it doesn't belong.

What bars do these aliens hang out in? might I ask.

If Chimp invites you to that little hole-in-the-wall vegan juice bar around the corner, do be careful.

I'm too ancient to get too lucky. But, now that you mention it, a friend is working on a new vegan cookbook for hard times. He thinks they'll make the healthiest meals around.

JUST KIDDING, just kidding.

Hi Bill,

I like the part about diamonds and carbon (despite the inaccuracy, there may be a point there.)

re: "...Except for..."

Well, I suppose it's possible to grow crops. But then how do you transport them to the other 6.7Billion of us?

re: "Looking forward to..."

What is your idea for helping people get "un-scared" and "focused"?

What is your plan for addressing the ills you mention?

A short piece on the Today programme on Radio 4 this morning, a short clip from A Crude Awakening, then an interview by Nick Cosgrove with Prof Martin Blunt, Chair in Petroleum Engineering at Imperial College.

Quite a good summary of the position.

The listen again is at


The interview begins at 6:40

I would like to ask my American colleagues what they think would happen if gas prices where $7.50+ a gallon?

Social collapse? Rioting? Looting?

Well next time you visit London take a look around because that's what we are living with day-in day-out.

And even with prices that most of you may gasp at, Supersize vehicles (SUVs) seem to be growing in popularity, we call them 'Jeeps' or 'Land Rovers' and they are used more to take kids to school than shoot crocks in the outback but they are present it seems in increasing number. You don't see them very often and its a bit like the first time the Aboriginees saw a white man but occasionally, yes, even a Hummer -and a H2 at that.

Our high taxation has churned money back within the EU that would otherwise have been exported to prop up otherwise unstable regimes. It has buffered us against rises in the underlying input commodity and in most part has modified our transport behaviour towards more efficiency. Sure some people here are in 'Elk Mode' -but as a % of disposable income petrol is still cheap even at these prices.

So will $200 oil be "the end"? I doubt it but I guess we will have to wait a few years to find out...

Regards, Nick.

P.S. I have a haulier friend who tells me that the business is getting very hard here in the UK with diesel at £1+ a litre -he is my 'canary in the coal mine'- and he expects some of the smaller operators to start going to the wall in the next few years. The only solution I see to this is massive Industry consolidation and the cost of goods rising to reflect increased transport costs -i.e. Price Inflation of just about everything that gets moved from A to B.

Noutram: Supposedly the ave American family drives approx 65000 km a year. Try that and see if $7.50 gas stretches the budget somewhat.

The average American travels around 12,000 miles per year at an average MPG of around 20 so that's 600 Gallons of Gas.

At $3 per gallon that works out at $1800 per year in transport fuel.

If the Average American where paying UK prices they would be paying more like $8 / gallon or 8/3 * $1800 = roughly $4800 per year, a $3000 dollar increase.

To 'stay at todays outgoings' the average American would have to raise MPG by the same factor 8/3 or purchase a car that does 53 MPG -which car does this?


-The Toyota Prius hybrid does about 43 MPG and the upcoming Hybrid plugin (that can be currently 'made to order') does >68 MPG.

So if -in the US- you want to avoid the pain of the upcoming massive rises in Gas prices (or lower your UK tax bill): BUY A HYBRID WHILE YOU CAN STILL AFFORD TO...


Noutram: Supposedly the ave family has two cars. The 12000 mile number per car might be right- 20000 sounds high-picked it up off a post. So your number would be 39000 km per year.

OK, but they also have two incomes and twice the saving if they both buy Hybrids...

Personally I drive a 3 litre BMW Z3 convertable sports and get my petrol payed for so I'm not crying into my milk just yet :o)


To 'stay at todays outgoings' the average American would have to raise MPG by the same factor 8/3 or purchase a car that does 53 MPG -which car does this?

Well, my '97 VW Jetta TDI does this. Last fillup was 720 miles on one tank at 13.7 gallons. I only fill up around once every 3-4 weeks, and I drive to work 4 days a week. I figure even diesel fuel at $15/gal wouldn't really be that much of a hardship for my budget, but I have a feeling the rest of the economy would be in shambles at that point along with my job, so a moot point.

I remember reading dozens of similar comments in 2001 at the time of the refinery blockades. The hauliers will not go broke short term because they ALL face the same increases and will be able to force them through to their customers. In fact the 2001 protests were because the UK hauliers were facing higher prices than the rest of Europe, and so were losing out to overseas competition,

Long term, of course, we are going to see demand destruction. That will inevitably include hauliers, but we are not there yet.

Hi Oil Drummers,
There are more articles on the BBC, certainly from Berlin 2004 and a few others...from a few years back.

Here's one.

Also Aljazeera ran a load...not all of which are still on line...

Here's one on Ali Bakhtiari...

And here's one from New Internationalist in 2003

Sorry for blowing my own horn ;)
And sorry that some of the above is a bit rubbish and over stated...my bad.

But the topic has been in the mainstream for a while ;)

Hey Adam, nice of you to drop in.

I agree that oil issues are increasingly entering the mainstream, its a big issue, how could it stay out?

I think when people say "mainstream" they mean headline evening news, with some serious analysis of what can be done about it, i.e. reaching the guy on the Clapham omnibus (does that metaphor still work?)

For example, the BBC has a lot of stuff, you could call it almost a campaign, on Global Warming issues. It's easy to find from the front page. Some oil supply is stuff is there but much harder to find.

What I would like to know is what sort of editorial decisions go into making GW a prominent feature, and what events would have to happen before oil supply would be given similar prominence?

The New York Times is finally getting with it as well, in an article out today. A snippet:

With oil prices approaching the symbolic threshold of $100 a barrel, the world is headed toward its third energy shock in a generation. But today’s surge is fundamentally different from the previous oil crises, with broad and longer-lasting global implications.
“This is the world’s first demand-led energy shock,” said Lawrence Goldstein, an economist at the Energy Policy Research Foundation of Washington.

Unfortunately, they also repeat a silly demand projection: "More realistically, global demand is expected to rise to about 115 million barrels a day by 2030..."

The MSM may now be willing to admit the reality of supply not being able to keep up with demand, but it seems none of them are quite yet willing to admit that it will stay that way and that global production will never break 100 mbpd (if it gets there at all).

I assume that's because they'd rather say that demand will be 115 (or 122) mbpd than say that by 2015, oil will cost $200+ a barrel and gasoline will be $7-10/gal (U.S. prices and currency, sorry!)


$100 oil won’t hold.

From Mark J. Perry's Blog for Economics and Finance and the Wall Street Journal:

1. The amount of oil in storage tanks around the world is near all-time highs.
2. Supply below ground is abundant. The world's proven reserves are now at 1.4 trillion barrels, up 12% in the past 10 years.

3. Production is set to increase. Sustained high oil prices have encouraged drilling. There are 45% more oil rigs in service today than there were three years ago.

4. The cost of production is much less than $100 a barrel, about $4-30 per barrel. Oil prices can fall heavily without making any of this production uneconomic.

5. Iranian exports aren't likely to be cut.

6. High prices are pulling back demand. Oil consumption in the U.S. fell by 1.3% in 2006 and world-wide demand grew only 0.60%.

7. High prices are forcing governments to cut subsidies (Iran, China), which should curb demand growth.

8. On a relative basis — comparing the amount of energy bought with a dollar’s worth of oil with a dollar’s worth of natural gas — the price for natural gas is now about half that of oil, further suggesting that $100 oil is not sustainable (see chart below from today's NY Times).

9. A weak dollar doesn't justify $100 oil. Since Aug. 22, the dollar is down by only 8% against a basket of currencies while the oil price has risen by 40%.

10. Speculation is artificially boosting prices.

Source: Wall Street Journal article "Why $100 Oil Can't Float"

Pay special attention to the graph of future prices.

Supply below ground is abundant. The world's proven reserves are now at 1.4 trillion barrels, up 12% in the past 10 years.

Anybody that uses this to refute the high cost of oil, or peak oil, doesn't understand what pricing and peaking is about.

For instance, Peak Oil is about flow rates - the 'size of the tap', not the 'size of the barrel'.

Most of the other reasons given above for the price to fall are also very weak or completely spurious.

The reality is, nobody knows what price the future will bring!



Reread the post. I don't recall I was refuting peak oil, or whatever. I was merely pointing out that, more than likely, the $100 price will not hold for the listed reasons. If you dabble in the oil futures market I believe the price will decline. I wasn’t trying to shake your faith.

The listed reasons are mostly rubbish. If you base decisions on those sort of reasons, you are going to get burned ;)

Macque: #9 is just plain silly and clearly exhibits why even the WSJ is almost always full of crap when discussing economics. Yes the dollar is down less than the oil price has risen since Aug 22- SURPRISE! Other fiat currencies are also being devalued at a rapid clip (just not as fast as the greenback). In fact, the dollar could hold its relative value against e.g. the Euro and this fact alone would tell you nothing about increased money supply able to chase diminishing oil supplies.

Hi macequechoux,

Just a quick comment to add to the others. Someone showed me this article, and it had so many misleading parts, I ran out of time to address them all. My friend, upon seeing that I could answer i.e., (that there were replies to be had), quickly became overwhelmed. And I can empathize with that...

One "red flag" that gives a sign one needs to look more closely and question, is the phrase "at current rates of consumption" - or "at current rates" (I'm recalling from inexact memory.) The phrase "at current rates", is usually part of the argument "There's plenty and it will last a long time."

Holding the world to "current rates" might help, however, anyone who uses that tricky little phrase as part of a description of the situation is perhaps unintentionally uninformed, or is deliberately misinforming others.

I just watched the clip and they are downplaying it by mentioning " above ground factors"

Not much time last week to keep up with TOD but I read an article in Wirtschaftswoche, 29th October, 2007, page 60 "Neuer Angebotsschock"(New Supply shock) by Malte Fischer, which magazine is the equivalent in Germany to the US magazine Business Week or perhapsin the UK "The Economist" with the following main points, barring a direct translation, that I would like to summarize:

The oil pice climb has not effected the economies ofthe world as it happened over quite a few years so we could get used to it and we had no actual shortages as in the 70s. It was the demand from China, India, etc. that drove up the price. Furthermore energy as a proportion of the German GDP is only 40% what it was in the 70s due to technological progress.Arabs bought products with the oil money and invested in the west. This recycling of petrodollars by the Arabs balanced out the total exonomic equation, relieving any potential stress from higher energy costs.

The author admits though that now the production has reached its limits(PO), and thatdue to a booming asian economy the demand is constantly growing and that maybe only the Saudis could expand production somewhat but if so that they will likely need this extra production eventually themselves for growing internal needs(ELM, thanks Jeffrey). World gap between demand growth of 1.5% annually and flat production will be 4 million barrels in 2008 , which will all come out of petroleum stocks. The German GDP growth could be reduced by .4% in 2008 if oil springs over $100/barrel.
End summary

This is about the limit of what such a business journalist is allowed to say. There is no long term prognosis of a general catastrophe or of a return to the stone age or advice to ride bicycles and conserve energy and all other articles in the magazine from 29th October 2007 (I purchased the magazine physically) discuss the world in terms of growth, i.e. of VW sales till 2012, etc. with no thought of consequences due to the facts of PO and ELM as shortly outlined in this one article by Malte Fischer, although a simple linear extrapolation would have sufficed to show that the admitted and unnamed phenomena of PO and ELM can and will crash the current state of affairs it is reduced in the article to a temporary growth problem in western economies and the rest of the magazine does not pick up on the phenomemnon as being particularly important.

However unfortunate in the limitations of the article and the entire magazine, I believe this recognition of the phenomena in terms of effects on quarterly growth results of a market economy is the first step. The problem has been recognized, and pure denial in terms of cause of high energy price and future supply have been cleared out of the way(no claims of 130 million barrles per day in 2030 or any other conceivable manmade substitutes) and I believe that next when the actual growth slowdown in the economies occur and inflationary spiral with actual fuel shortages which effect the average citizen's daily routine the next mental stage of recognition will occur in that the people will start to integrate the PO concept into all other parts of their lives with corresponding expectations in every part of industry and in the daily life of the ciiteznry with a large measure of planning from the political side to cope with the perceived difficulties.

“Without a video the people perish”-Is. 13:24