The World Has Plenty of Oil
March 4, 2008; Page A17
Many energy analysts view the ongoing waltz of crude prices with the mystical $100 mark — notwithstanding the dollar’s anemia — as another sign of the beginning of the end for the oil era. “[A]t the furthest out, it will be a crisis in 2008 to 2012,” declares Matthew Simmons, the most vocal voice among the “neo-peak-oil” club. Tempering this pessimism only slightly is the viewpoint gaining ground among many industry leaders, who argue that daily production by 2030 of 100 million barrels will be difficult.
In fact, we are nowhere close to reaching a peak in global oil supplies….
This is the beginning of an opinion piece by Mr. Saleri “refuting” peak oil. The link is:
http://online.wsj.com/article/SB120459389654809159.html?mod=opinion_main_commentaries
It is so tiresome, but I guess is necessary, to continually refute the propaganda put out by peak oil deniers. (It seems I am now in the “neo-peak-oil” club – a label I have not heard before.)
Mr. Saleri relies on the tried and true misinformation principle. His title “The World has Plenty of Oil” has virtually nothing to do with Peak Oil. No one who has seriously studied peak oil claims there is not a lot left.
But Mr. Saleri stretches the reserves argument to a new height; by beginning with “global resources in place” of 12 to 16 trillion, and saying we have only used 1 trillion, he paints a far rosier picture than even Exxon-Mobil does when they claim there are 3 trillion recoverable barrels. But then, Mr. Saleri’s consulting firm is all about raising the percentage of recovery by a few percentage points, so this fits with his agenda.
But I have fallen into his trap; Peak Oil is not about how much oil is below the ground, it is about how much the industry can produce each and every day. The U.S. has been declining since 1970. Mexico is in decline. The North Sea has passed peak. Each of these countries produce less oil – by about 3% to 8% each year – than they used to. Put another way, about 4 million barrels per day of NEW production is needed each and every year just to offset declines from older fields – and each year every field becomes older.
It doesn’t matter 1. how much is below the ground, 2. what percentage is recoverable, or 3. what the consumption is, the key question is how much is produced each day. And as for Mr. Saleri’s 4th point, that a “widely accepted tipping point — 50% of ultimately recoverable resources consumed” is a definition of peak oil – again, no one who has studied it seriously argues this is the case any more.
The evidence is out there. Look at this map of world production decline:
world oil map or this review of what oil company executives are saying:
energybulletin.net
Finally, “the Stone Age did not end due to a lack of stones” ? Give me a break!
Randy Park
