IEA says world has passed oil production peak

[Try2B_Comprehensive]

@Blake

No, I’m not. Duckster thinks there is a conspiracy that keeps either prices high or supply low (not clear which).

Maybe. But his cites demonstrate the flatness of global oil extraction in recent years.

So you started the debate by quoting sources that you didn’t believe were accurate without noting that you knew they were inaccurate. That seems disingenuous at best
Certainly some people mislead, by quoting information that they know is inaccurate for example.

I suspected this is what was pissing you off. Look- I WANTED an atmosphere of misinformation and mistrust. That is where I am coming from. But 'dopers can be stubborn. I could just say, ‘okay everybody, put yerselves in a distrustful mood, as if you’d seen bad information.’ Half or more would outright refuse, and the whole thing would be derailed regardless.
This way, I hoped, some more believable information on the subject might be brought to light.

You managed to respond to four posts, including notifying another poster about what you wished to debate, before you answered my simple questions concerning what you wished to debate.

Well I’m sorry you don’t feel like I am paying you enough attention, Blake. I will strive to do better in the future.

In fact you still haven;t told me what it is you wish to debate or what your stance is on the issue.

So it isn’t a case of giving you time to respond. It is the fact that you refuse to respond when clearly you did have time. You are pointedly ignoring the very basic question: what do you wish to debate and what is your stance on that issue.

Actually, it is a case of not giving me time to respond. I’m busy. And I have already mentioned a number of things which I consider debate fodder. Most or all of which you find unsatisfactory it seems. I’m sorry, Blake, let me try to focus harder for you. How’s this:

EROI (Energy Returned on Energy Invested) has been dropping like a stone in recent history. That, right there, might be fodder for debate.

The meaning of this, however, is that more and more energy must be invested to extract an energy-equivalent amount of oil. Oil (end-use) demand is rather inelastic, and so demand pressures can force prices in an exponential manner in order to (temporarily) meet demand. But a few decades of this and even the hard-to-get resources become exhausted, and societies cannot bear another iteration of exponential price increases. Frankly, I think a smart investor would prefer to avoid this outcome. Dunno, could be debatable.

The point is that the number of barrels of oil extracted isn’t really the bottom line. If you have to reinvest half your energy just to keep the operation going, costs can skyrocket in a way that will adversely affect all other sectors. Instead of looking at the number of barrels of oil, look at the net vs gross energy return out to 2030 and beyond. From the Oil Drum article:

Net Energy = Gross Energy * ((EROI – 1)/ EROI)

Figure 3 shows the results of this analysis. Unlike the original Hubbert curve that shows equal quantities of gross energy resources on the left and right side, the Net Hubbert Curve is skewed so that most resources are on the left. For example, according to the original Hubbert curve, 50% of the energy resource is remaining when production levels reach the peak, but this is quite different for the Net Hubbert curve. Due to declining EROI, by the time peak production is reached, 73% of the net energy available is already used.

So all the premier reseach bodies in the fiueld and all the peer reviewed science is wrong? The USGS is wrong, the EIA is wrong, the WEO is wrong? Why do you believe all these bodies, all these eminent geologists and geophysicists and economists are wrong? What is the basis for this skepticism?

They are emphasizing the wrong thing. Number of barrels isn’t the answer. This approach appears to cause a colossal energy (or at least oil) shortage after 2030. If I am taking the Smart Investor stance, I’d probably prefer to avoid or at least mitigate this outcome.

And why the skepticism? Because the big oil companies do not just extract oil, they also manufacture political hacks. Why do you think Palin says what she says when she talks about oil? I think it is because she is queen of the hacks, and there are more like her on the Right.

Do you personally have post-grad qualifications and decades of experience in geology, geophysics or economics? Do you have references from people who do that contradict all those other sources?

Gee, I dunno, that’s kind of a personal question.

In short. why do you believe this claim when everybody who is credible and all logic and all common sense and all past experience says that you are wrong?

When did they say I was wrong?

Did you bother to read my posts? I won;t ask if you read the actual articles that I linked to, since you clearly didn’t. But at least you could read my posts.

Well! I feel like you didn’t read my cites, or this wouldn’t have quite taken this tack in the first place. Fact is I did read it, but the momentum of my ranting overruled my memory of the details. Sorry, I’ll try to be more meticulous next time.

No, it doesn’t include natural gas. The increase oil production comes from “processing gains” and “natural gas liquids (NGLs) and unconventional oil”. It says so right there in my post.

I think it was you who earlier accused me of quoting out of context. I want to point out that you were quoting lines from a different source which were not included in the article I cited. Anyway, that was a good link on your part.

Ahh, no, production is *stable *all over the world.

Why do you think that production is declining? Can you provide a reference for this claim?

Aggregate, yes it is stable. But plenty of places face declining local production. One article I linked to shows the decline in US oil production since 1973. Maybe this link will shut you up for a second. If the data is correct, obviously there are plenty of places facing immanent production plateaus or declines. For fun (or debate), click on the United Kingdom’s graph.

1. Who said that offshore drilling was going to make up the shortfall on its own?

2. Why debate a claim that nobody has ever made? Isn’t that a strawman?

Sorry if that wasn’t sharp enough, but let’s not get pedantic, ok? What is actually going to make up the difference? Oil shale? That takes a lot of water at millions of bbd. People need that water. You can’t just take it for oil shale.

This is, what, the 6th time I have asked you to clearly state what you want to debate and what your stance is on the issue.

Is anything here satisfactory, or do I need to apply some further improvement?

Firstly you are conflating two separate issues. “Changing the arithmetic” =/= inflation. “Changing the arithmetic” is a meaningless term used, in my experience, by those who refuse to be pinned down on what they believe or what they propose. The sorts of people who refuse to state what their position is or what they want to debate.

It is, in short, a classic example of the use of weasel words.

I figured a guy named Blake would grasp a concept like this. Look, if world energy production rises for a couple centuries because of cheap reserves, and then enters a period in which net energy gains are flat, why, there is a real shift in momentum there, no? If it were a score you’d start another movement there. I dunno, it is debatable. Do you really not get it?

Secondly, you can’t take it for granted.
Well hemp is much more expensive now than it was in 1900, agreed?
And hemp is essential to sailing ships, agreed?
And sailing ships were essential to transporting food inn 1900, agreed?

So food must be much more expensive now than in 1900? Agreed?

Except that it’s not. Food is much cheaper now. So there must be a flaw in this logic. Can you see where it is?

Yeah, it is 2011 and we are talking about oil and energy.

This is what happens when you start “taking things for granted” rather than clearly stating what your position is and what your basis for that position is. It leads to making ridiculous, chicken little extrapolations that are inevitably wrong.

Who said the sky was falling? The Long Emergency is the apocalyptic version of the consequences of peak oil, and I plainly stated that I chucked that. Remember? No? Well it should be clear that my plans are not for the end of the world.

Or to put it another way, it is debatable that they will not. And there is no evidence presented for either position.

So once again, a classic use of weasel words.

Sorry. Don’t you remember that the Tunisian revolts were sparked by a guy who set himself on fire to protest high food prices? And now one government is changed, another looks like it is going down, other authoritarian states have made concessions to sustain the peace. Revolutions out of food prices! But I guess it is all weasel words to you.

Well the IEA and Exxon and the PRC all say that there is nothing that requires a solution for the next 30 years. We have plenty of oil for the foreseeable future. The problem of peak oil simply has no basis in reality.

Except that we don’t really want to go off a cliff in, ahem, 19 years just so that Exxon can score exponential profits. We would want to make a more aggressive move away from their scenario.

You are once again begging the question. You are assuming that a problem exists and asking for solutions without ever showing any evidence that the problem is real.
The people promulgating this Chicken Little nonsense, the people you quoted in the OP,m the people that you knew were lying, those people have been forced to blatantly misquote the IEA by chopping the end off a sentence that says clearly that peak oil is a myth. They are forced to those sorts of measures to give the problem any semblance of credibility.

With level of credibility form the people presenting this problem, I want to see some damn strong, independent evidence that the problem you posit actually exists.

Well, now I have presented a mathematical demonstration. What is your opinion of it?

I’ll stop the blow by blow here, I think you get off track at the end.

[XT]

Just a couple of quick observations:

[QUOTE=Try2B Comprehensive]
EROI (Energy Returned on Energy Invested) has been dropping like a stone in recent history. That, right there, might be fodder for debate.
[/QUOTE]

Looking at that graph in the context of the article, they are talking about the US, which never had the size of reserves world wide and which became depleted a rather long time ago. Even then you are looking at getting 11 barrels of oil for one barrel of energy, and we are far more depleted that the world wide reserves. So…I’m unsure what this graph is trying to do besides possibly playing with numbers to make things look worse than what they are.

The meaning of this, however, is that more and more energy must be invested to extract an energy-equivalent amount of oil.

There are 3 data points on that graph and no references that I saw about where or how the data was gathered. And it’s talking about US oil production. So, ‘The meaning of this’ is unclear to me, to be honest.

The point is that the number of barrels of oil extracted isn’t really the bottom line. If you have to reinvest half your energy just to keep the operation going, costs can skyrocket in a way that will adversely affect all other sectors. Instead of looking at the number of barrels of oil, look at the net vs gross energy return out to 2030 and beyond. From the Oil Drum article:

Except that the data the article is using has to do with US oil production, yet this isn’t emphasized or expanded on…the author simply moves on to arcane calculations of future doom without going into the detail that US production is not really related to world production, and that initial US reserves of easy to access oil were never very large compared to other places and were relatively quickly depleted. To me, this article appears to be a bait and switch to me (it will be interesting to get Blake’s take on it, assuming he comes back to the thread…or Sam’s).

They are emphasizing the wrong thing. Number of barrels isn’t the answer. This approach appears to cause a colossal energy (or at least oil) shortage after 2030. If I am taking the Smart Investor stance, I’d probably prefer to avoid or at least mitigate this outcome.

It doesn’t appear to show that at all, nor am I seeing how it would. As oil becomes more scarce (and assuming it takes more energy to extract) it will rise in price. When it reaches a certain price then other technologies that are already in development but are simply not economical at the current price of oil will become viable and will be able to compete for market share. As the price of oil continues to rise these other technologies will continue to take market share away, until eventually enough people adopt whatever the new system is to put oil into a more and more secondary role as an energy source, until eventually it’s completely or mostly subsumed.

If you REALLY think there will be some sort of oil energy crisis where oil will skyrocket in price, then you should invest heavily in oil commodities. I wouldn’t recommend that, unless you really believe what’s being pushed at The Oil Drum, however, since to me it looks like a bait and switch. I’m betting that the author isn’t heavily invested in oil commodities, despite the gloom and doom.

As to the subtext of what you are asking for, investment wise, the answer is ‘no one knows’. No one can predict the future and see what technology or technologies will eventually supersede the current system because, right now, oil is still a very cheap and plentiful energy source, so nothing will compete with it. A lot of potential technologies are either waiting in the wings or in development right now to either be a transition technology or a replacement technology, but for the most part they are more expensive and either have to be in a niche market where people are willing to pay more to be early adopters (or just to look cool and trendy) or the technology isn’t available at all to the general public except in corporate sponsored testing (such as the hydrogen fuel cell vehicles). If anyone on this board DID know what the future was going to be they certainly wouldn’t tell you in this thread…they would quietly be investing their money so that they could become rich and retire to lead the good life.

-XT

[DSeid]

This from the WikiLeaks Dump.

The US thinks the Saudis are saying they got more than they do.

Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, met the US consul general in Riyadh in November 2007 and told the US diplomat that Aramco’s 12.5m barrel-a-day capacity needed to keep a lid on prices could not be reached.

According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12m barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point. This crunch point is known as “peak oil”.

Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap.

One cable said: “According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray.”

[Try2B_Comprehensive]

@xtisme

Looking at that graph in the context of the article, they are talking about the US, which never had the size of reserves world wide and which became depleted a rather long time ago. Even then you are looking at getting 11 barrels of oil for one barrel of energy, and we are far more depleted that the world wide reserves. So…I’m unsure what this graph is trying to do besides possibly playing with numbers to make things look worse than what they are.

I didn’t realize it was limited to the US. I’ll keep looking for a graph of the global rate. That’s interesting.

Except that the data the article is using has to do with US oil production, yet this isn’t emphasized or expanded on…the author simply moves on to arcane calculations of future doom without going into the detail that US production is not really related to world production, and that initial US reserves of easy to access oil were never very large compared to other places and were relatively quickly depleted. To me, this article appears to be a bait and switch to me

That’s interesting. Who would suspect one of these authors to have such an agenda?

It doesn’t appear to show that at all, nor am I seeing how it would. As oil becomes more scarce (and assuming it takes more energy to extract) it will rise in price. When it reaches a certain price then other technologies that are already in development but are simply not economical at the current price of oil will become viable and will be able to compete for market share. As the price of oil continues to rise these other technologies will continue to take market share away, until eventually enough people adopt whatever the new system is to put oil into a more and more secondary role as an energy source, until eventually it’s completely or mostly subsumed.

That’s a good description of the theoretical function of market forces, but you are leaving out the inelasticity of the demand for oil. Alternatives aren’t really available en masse, and if things move too quickly I am concerned that the ‘market solution’ is that a lot of people won’t get anything at all.

If you REALLY think there will be some sort of oil energy crisis where oil will skyrocket in price, then you should invest heavily in oil commodities. I wouldn’t recommend that, unless you really believe what’s being pushed at The Oil Drum, however, since to me it looks like a bait and switch. I’m betting that the author isn’t heavily invested in oil commodities, despite the gloom and doom.

Well… I kind of want to avoid investing in oil itself, since 1) while it makes a buck 2) it isn’t a part of the solution.

As to the subtext of what you are asking for, investment wise, the answer is ‘no one knows’. No one can predict the future and see what technology or technologies will eventually supersede the current system because, right now, oil is still a very cheap and plentiful energy source, so nothing will compete with it. A lot of potential technologies are either waiting in the wings or in development right now to either be a transition technology or a replacement technology, but for the most part they are more expensive and either have to be in a niche market where people are willing to pay more to be early adopters (or just to look cool and trendy) or the technology isn’t available at all to the general public except in corporate sponsored testing (such as the hydrogen fuel cell vehicles). If anyone on this board DID know what the future was going to be they certainly wouldn’t tell you in this thread…they would quietly be investing their money so that they could become rich and retire to lead the good life.

How about copper?

[XT]

Hm…no idea on the copper thing. I’m not in the commodities market, because a lot of times it’s counter intuitive (to me anyway…my dad lost a lot at various times in commodities and I generally don’t touch them). Copper has a lot of uses, and seems to be relatively scarce, and on the telco side it will probably just continue to be used in large quantities. Whether that all translates into a good investment…no idea man. You pays your money and takes your chances. Me, I have IRA’s and mutual funds, some stocks (not many of those anymore) and bonds and T-Bills. I gave up trying to be rich and retiring young when the Dot Com bubble burst and I lost basically everything. Now I’m a ‘slow and steady’ kind of guy, and hope to be able to retire by 60…ish.

-XT

[Try2B_Comprehensive]

I found the link I was looking for. Hopefully I can clarify everything now. It explains the root of my suspicions and the bone of my contention.

First of all, here is a diagram of M. King Hubbert’s original 1956 prediction of world petroleum production rates.. The peak does appear to be right around now. This is significant because the model has shown to be accurate in many cases- though not always.

It might be interesting to take a quick look at the chart in this article about global oil discoveries.

I want to remind you of Blake’s lecture about taking things for granted. That was perfect! I kind of have the same peeve, see below.

To add gravitas, check out World Oil Capacity to Peak in 2010 Says Petrobras CEO. Might the CEO of Petrobas know whether or not there is anything to this peak oil business? He’s got the resume…

Anyway. The link is just a graphical representation of some the IEA’s conclusions (you have to click the arrows to view #7, sorry). The data I was referring to in the OP. It is clear to see how they project a gradual rise in oil production through 2035. Note: taking the IEA projections at face value, crude oil production remains flat. A peak and then a plateau.
Sure. ‘Currently producing fields’ are scheduled to drop quite a lot. And there is a lot of oil mapped out in the ground which isn’t being drilled- that’s the ‘fields yet to be developed.’ ‘Natural gas liquids’ provides lots of volume and a little growth over the period. Why wouldn’t it? Fracking is delivering huge gains in gas. And then stuff like ‘heavy oil’ or tar sands, maybe shale I suppose- the ‘unconventional oil.’ It doesn’t amount to much compared to the others, but it does grow a little.

I forgot one. ‘Crude oil fields yet to be found’. That’s my problem right there. They predict something like 22 million bbd from new, undiscovered oil fields within 25 years. If you clicked the link above about oil discoveries (and if it isn’t total bunk), you realize how absurdly unrealistic this prediction is.

ISTM they just take for granted that we’ll discover, then bring on-line, 22 million bbd of new crude oil. That’s not good. Remove the entire section (which now is going a little too far) and suddenly the IEA’s projections look like, well, the world passed its production peak.
So! You can win the debate if you can make a convincing argument that my problem is unfounded because there are in fact (or predicted with good reason) 22 million bbd of new oil that can be realistically discovered and exploited in the next 25 years. There are still a lot of side debates in this messy topic though.

[Try2B_Comprehensive]

@xtisme

Hm…no idea on the copper thing. I’m not in the commodities market, because a lot of times it’s counter intuitive (to me anyway…my dad lost a lot at various times in commodities and I generally don’t touch them). Copper has a lot of uses, and seems to be relatively scarce, and on the telco side it will probably just continue to be used in large quantities. Whether that all translates into a good investment…no idea man. You pays your money and takes your chances. Me, I have IRA’s and mutual funds, some stocks (not many of those anymore) and bonds and T-Bills. I gave up trying to be rich and retiring young when the Dot Com bubble burst and I lost basically everything. Now I’m a ‘slow and steady’ kind of guy, and hope to be able to retire by 60…ish.

-XT

Yeah, one can tell a good story about copper, but I don’t know how to call commodities either. But you are probably right, oil itself is probably the no-brainer.

Too bad about the dot com thing. I got my own tales, but maybe another time. I guess I have a more aggressive portfolio, but I am in the beginning phases of it.

[Precambrianmollusc]

@Stoneburg

Quibble point: We don’t produce oil, we extract it.

Quible quible point
It is perfectly acceptable to talk about oil production.

Merriam Webster
Production - total output especially of a commodity or an industry

Also in the oil and gas industry we regularly talk about oil production, well production rates, well producibility, production sharing agreements, producible fluids etc.