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When Will Oil Run Out?

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  • Light Eye
    Dear Friends, It s not a question of when it will it will run out, but when we hit peak production. Look for it between now and latest 2012.
    Message 1 of 1 , Oct 3, 2005
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      Dear Friends,

      It's not a question of when it will it will run out, but when we hit peak production. Look for it between now and latest 2012.

      http://www.dailybreeze.com/business/articles/1872087.html

      Love and Light.

      David

      When will the oil run out? Experts can't agree

      One controversial doomsday theory points to this Thanksgiving as the start of declining
      supply and increasing demand while others say there is still a 30-year window.



      By George Jahn
      THE ASSOCIATED PRESS


      VIENNA, Austria -- Fact: World oil production will peak someday, and supplies will start running out.



      But when will the tipping point come -- in years, decades, or a couple of months from now?

      The oil industry says crude will be plentiful for at least another generation. But some experts argue reserves are overstated, oil technologies are limited and demand, sharply boosted by the needs of China and India, could soon outpace supply.



      "World oil production is going to peak on American Thanksgiving, with a three-week period of uncertainty on each side," declares Princeton professor, geologist and oil maverick Kenneth S. Deffeyes. He uses a formula first developed to pinpoint 1971 as the start of oil production decline in the United States.



      Once supply begins to dwindle, the years to follow will see shortages that at best will cause "global recession, possibly worse than the 1930s Great Depression," says Deffeyes. At worst, he warns of "war, famine, pestilence and death."



      Deffeyes' prediction is clearly controversial. Still, it is gaining an audience, and dozens of energy experts and academics say his arguments have merit.



      With supply already barely matching demand and prices high and rising, the U.S. oil giant Chevron has begun running ads declaring that "the era of easy oil is over."

      "The world has never faced a problem like this," says a report prepared this year for the U.S. Department of Energy's National Technology Laboratory. Although oil companies have searched intensively for new oil finds, "results have been disappointing," says the report, from Science Applications International, which focuses on security and energy concerns.

      "Oil peaking will be abrupt and revolutionary," says the report.

      Still, oil companies and governments are betting -- at least in public -- that new discoveries and technology will keep the world supplied for at least the next generation. And there are those who would welcome the tipping point, believing the psychological impact will push the world into a serious drive to wean itself off oil.



      The U.S. Geological Survey has predicted that a peak in recoverable oil production won't come until 2037, and Saudi Oil Minister Ali Naimi, in a recent speech to industry experts declared that "technological innovation will allow us to find and extract more oil around the world." But past comments by present leaders reflect high-level awareness of the problem.

      In a speech six years ago, before he became vice president, Dick Cheney spoke of estimates of 2 percent annual growth in global oil demand and at best a 3 percent annual decline in production from existing reserves.



      More recent predictions also focus on high demand and lagging resupply.

      Kenji Kobayashi of the global watchdog International Energy Agency wrote this year that global energy demand will grow by nearly 60 percent by 2030, and oil will remain the fuel of choice. He urged more exploration and exploitation efforts, noting a worrisome drop in oil discoveries in recent years.



      Proponents of plentiful oil disagree, saying the world's proven reserves amount to 1,277 billion barrels and expected technological advances will soon open up supplies now impossible or unprofitable to exploit.



      That, they argue, gives the world a decades-thick cushion to develop other energy sources.

      "There will be an increase of production for the next 20 to 25 years. Only after that may we face a decline," said says Helmut Langanger, head of exploration and production at Austria's OMV oil company.



      Wrong, say the critics: As oil need and the pace of production grow, so will the rate of reserves diminish.



      More worrisome are claims of inflated reporting by the Saudis, Iran and most other OPEC members whose national oil companies are not legally subject to audits and other controls. Even firms like Shell and Chevron are thought to base their proven reserve figures in the Middle East in part on unchecked numbers provided by OPEC-member state companies.

      OPEC nations deny padding their figures but even governments are becoming openly skeptical.



      British Treasury chief Gordon Brown recently urged OPEC members to "become more open and transparent" on how much oil they really have and how they plan to develop it.

      Energy expert Matthew Simmons says that except for Libya, Algeria and Nigeria, OPEC countries tripled their reserve numbers in the 1980s with no supporting data.

      Simmons, who advised George W. Bush's 2000 presidential campaign, says most OPEC nations were involved in a "proven-reserves arms race" -- overstating recoverable stocks because the organization assigned production quotas according to each country's reserves. In reality, Saudi reserves are probably closer to what they said they had 25 years ago and the same goes for most other OPEC nations, Simmons said. Middle East proven reserves are likely only a third of about 700 billion barrels being claimed, he said.

      Simmons, whose Houston-based Simmons & Company investment firm guides companies in energy-related acquisitions, also dismissed claims that improved technology will increase oil recovery from reserves.



      So when is oil going to peak?



      Simmons won't go as far as Deffeyes and his Thanksgiving projection. Still, he points to the world's present huge appetite for crude in saying the decline may begin sooner than some think, but will stretch over decades.



      "The difference between peak oil happening and (oil) running out completely is the difference between me saying 'I'm getting slightly hungry' and 'I'm starving to death,' " he said.




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