Peak Oil

As the Iraqi oil pie is being split up amongst the large world oil companies as we write, the Economist(12-10-09) had a great short article on “Peak Oil” or when the world will never be able to harvest as much oil as it has in the past
Some highlights from the article are:

-FATIH BIROL, the chief economist of the International Energy Agency (IEA), believes that if no big new discoveries are made, “the output of conventional oil will peak in 2020 if oil demand grows on a business-as-usual basis.”

-Despite repeated downward revisions in recent years in its forecasts of global oil supply in 2030, the IEA has not until now committed itself to a firm prediction for when oil supplies might cease to grow. Its latest energy outlook, released last month, says only that conventional oil (as opposed to hard-to-extract sources like Canada’s tar sands) is “projected to reach a plateau sometime before” 2030.

-These negotiations matter hugely for the peak-oil debate. The IEA reckons that co-ordinated action to restrict the increase in global temperatures to 2ºC will restrict global demand for oil to 89m b/d in 2030, compared with 105m b/d if no action is taken. That, Mr Birol says, “could push back the peak of production, as it would take longer to produce the lower-cost oil that remains to be developed.” Action on climate change may yet save the world from an early supply crunch.

Here are some interesting Economist blog comments on the article:

D. Sherman wrote
In terms of unconventional sources, the only really logical “next stage” as we enter into the period of declining petroleum is synthetic liquid fuels made from coal or natural gas via the Fischer-Tropsch process. For now, we can still fantasize about replacing oil with “green” windmills, solar panels, and electric cars, but as the end of cheap oil approaches, we’ll find out that those sources actually have huge petroleum inputs and they are nowhere near as cheap or as green as they look right now. It’s going to be very hard to beat a tank full of combustible liquid as the ideal energy source for all forms of transportation. Liquids are easier to handle than solids or gasses, and combustible substances need provide only one of the reactants, with the air providing the other. There is a reason that no one built a successful coal-fired or nuclear-powered airplane.

and

Yes, past energy crises seem to have been solved by the spontaneous appearance of new forms of energy. When the climate got too cold for naked apes to survive in northerly latitudes they discovered they could burn wood. When wood ran short, they discovered they could burn coal, and there was lots of coal to burn. The whales were saved, not by Greenpeace, but by Standard Oil. There may well be something great and wonderful yet to be discovered that will replace oil or synthetic oil as a transport fuel, but a lot of smart and greedy men have been looking hard for the next big energy thing for a long time, and they really haven’t come up with anything. All the “alternatives” have been around long enough that their costs and limitations are well known. Batteries and engines are still only incremental improvements on 100 year old technology.

We do not agree totally with Mr Sherman although his argument is strong. The oil economy is so young really, the 1920’s I suppose is when it became pervasive. But civilizations were great before oil and can be great after it. One prob is we really do not know how much oil is out there but if we can offer many types of energy to power our lives then oil will just become another piece of the puzzle and not the entire puzzle as it is now