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Peak Oil 2014
The following article published in The Guardian and based on the work of Chris Skrebowski (Peak Oil Consulting) - indicates a crunch in oil supply vs. demand coming in 2012. It seems clear that the assumption of demand growing at 1.6% per year is now invalidated by the current global recession. Moreover, supply growth in 2008 and 2009 will be reduced by demand restrictions and will therefore be moved into later years. But if global growth does resume in 2010 and if geological constraints act more or less as Skrebowski believes they will, then prices should rise well above 2008 levels in 2013 or 2014.
UK will face peak oil crisis within five years, report warns
Declining availability of oil will hit the UK earlier than generally expected, with potentially devastating implications for the UK economy, report warns
The risk to the UK from falling oil production in coming years is greater than the threat posed by terrorism, according to an industry taskforce report published today.
The report, from the Peak Oil group, warns that the problem of declining availability of oil will hit the UK earlier than generally expected - possibly within the next five years and as early as 2011.
Oil supply could then rapidly decline, or even collapse, the report warns, with potentially devastating implications for the UK economy.
The report was issued today by the recently established UK industry taskforce on peak oil and energy security, a group of eight companies including transport firms Virgin, Stagecoach and FirstGroup, engineers Arup, architects Foster and Partners, and energy giant Scottish and Southern.
Entitled The Oil Crunch, the report argues that the risk of an early peak in oil production poses a bigger threat to UK society than tightening gas supplies, terrorism or the short-term impacts of climate change.
The “peak oil” debate has raged for many years. Some governments and oil companies believe that crude oil production will meet rising demand for decades to come. But an increasingly vocal group - including many experts from within the oil industry - claim that a production peak is imminent.
The new report marks the first time a group of businesses has weighed into this debate. At its core are two newly commissioned assessments of future oil production: one from Chris Skrebowski, consulting editor of Petroleum Review, and one from Shell.
Skrebowski predicts that global oil production will peak in the period 2011-2013 and then decline steadily, with non-conventional sources such as tar sands failing to fill the gap in time to avoid a serious energy crunch. He also warns that supplies could collapse if a handful of huge, long-established oil fields go into terminal decline simultaneously.
Shell, by contrast, foresees oil production rising until 2015, and then remaining on a plateau until the 2020s, with unconventional sources balancing out a decline in regular crude extraction.
Having examined the evidence, the taskforce considers that Skrebowski’s peak-and-fall scenario is the “highly probable” outcome, with the collapse scenario also possible.
This view contrasts starkly with the position of the British government. A statement from the new Department of Energy and Climate Change reiterates the government’s established view on this issue.
“The government’s assessment is that global proven reserves are larger than the cumulative production needed to meet rising demand until at least 2030,” the statement says. “This is consistent with the assessment made by the International Energy Agency in its 2007 World Energy Outlook that lead to the conclusion that global oil resources are adequate for the foreseeable future.”
Tags: peak oil investments
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11 responses so far ↓
1 robert essian // Nov 4, 2008 at 6:16 pm
Jim, it looks as though this Peak Oil theory has wings and will wisk us off to a promising future.
Lets look at the positives;
Opec is defending the price of oil so a resonable cost for crude will grow gradually allowing alternatives to flourish and not be priced out of the market by low crude costs. $60.00 oil has been defended a few times now and many company’s can produce at that costs. $90.00 would be better.
Oil stocks will recover moderately so the faithfull will live to see another day. Stocks were deffinately over sold because of all the hedging and speculating.
The IEA report will show a higher than expected decline in oil field production and bring about more information that in fact the world needs to change towards alternatives. The more information that is negative and mainstream the better.
I understand that a recession looms large and to be careful. Buy on the dips sell on the highs but if the economy is positive looking after the 2nd quarter ‘09 I’m good with that.
Regarding the economy and Mr.Malduin (sp) he believes that the recession started in Oct.2007 (?) and he could be on spot. If that is the case then a turn for our economy would be mid year and not late in 2009. The sooner the better.
A new stimulas package to feed our countrymen and extend unemployment looks to happen in our lame duck congress. Followed by a infrastructure boost after the inaguration. Financials and banking would be in better shape by January and are showing positives now.
The auto company’s will get some sort of bailout and will be producing the cars of the future here in America.
The industry is so critical to our future. We cannot loose this manufacturing base too.
Before a bankruptcy the unions and companies will negotiate. In return the retired auto workers get back benefits when the industry turns around. No one wants to risk loosing anything and they certainly don’t want to risk everything.
The world economic powers are to start slashing interests rates to boost their economies. Any growth caused by these actions would be welcomed. Stimulas packages will be forth coming especially in infrastruture and that is a benefit to their futures too.
Your posts this week on what’s happening in Egypt, Ausralia etc…has convinced me that this will be a world event. I’m banking on it. We need a miracle and this is it.
I could go on but I will leave the very best for last. Obama will inspire our country and move us forward very positively. Certainly he will out shine the previous administration on his first day than Bush did his entire Presidency with the exception of the 9/11 aftermath. After that though he was a total idiot…Peace and a toast to better days.
2 KV // Nov 5, 2008 at 6:31 am
RE - Yes, I welcome change. The most critical part for Obama is to move away from fear. Close Guntanamo. Let us remove the word “terrorist” from our political language and bring the word “criminal” back, and call those who blow up themselves and assist in blowing up the criminals, the real criminals. The two turbans that Bush failed to deal with are THE criminals.
I share your optimism but I also dread what may be ahead. Just about every major US company is a financial company - GM, F, GE, CAT, DE etc. and we simply don’t know the extent of the problem we face. Coming two years are defining years for us and the rest of the world.
Today, I join you in a toast to celebrate Unity of Man, and Best of America, the people who came from all over the world and continue to come for life, liberty and pursuit of happiness.
3 robert essian // Nov 5, 2008 at 8:18 am
KV, your fears are shared by me also.
Our economy reminds me of many story’s we’ve heard in our lives of women with a sudden burst of adrenaline lifting the dead weight of a car off a loved one. Lets hope our collective strength matches just such a women.
Today is the beginning of the next great generation…Peace
4 KV // Nov 6, 2008 at 7:17 am
RE - I am a optimist, but I am apprehensive because I can not conceive the depth of financial crisis, and I do not even bother to measure. Here is a para from today’s Bloomberg story on credit default swaps (CDS):
New York-based DTCC’s report, released on its Web site Nov. 4, showed a total $33.6 trillion of transactions on governments, companies and asset-backed securities worldwide, based on gross numbers. While designed to ease concerns about the amount of risk banks and investors amassed on borrowers from companies to homeowners, the study may have missed as much as 40 percent of the trades outstanding in the market, Cicione said.
Note the number: 33.6 TRILLIONS dollars!
Link: http://www.bloomberg.com/apps/news?pid=20601109&sid=aD.qjkK0K5QU&refer=home
5 robert essian // Nov 6, 2008 at 10:19 am
KV, I cannot wait until this all gets sorted out. The numbers do blow me away.
6 robert essian // Nov 6, 2008 at 10:25 am
Professor (Jim), MSN Money has just released from the IEA a statement that says oil fields are depleting by 6.7% and they expect oil at over $100.00 going forward.
I expect 6.7% to be the low number as do many highly respected experts.
Time to re-crunch your numbers because this has been the report I have waited for some time now.
No hurry…how about this afternoon…Ha! Ha!….Peace
7 KV // Nov 6, 2008 at 12:56 pm
RE - Can you post the link on IEA at MSN? I was getting panicky about reports on oil going below $40. I find that if oil goes that low too fast, it will take many good companies down the drain.
8 robert essian // Nov 6, 2008 at 5:30 pm
KV, on that request I am computer illiterate.
If this helps you can go to MSN.com/money or energy bulletin has pretty much the same information.
I will have my son show me tomorrow how to do as you requested…Peace
9 robert essian // Nov 6, 2008 at 5:47 pm
KV, in the Energy Bulletin you will find another article “Memorandum to the President elect”. You might like it…Peace
10 robert essian // Nov 6, 2008 at 6:02 pm
KV, I forgot to mention The Oil Drum has several articles too…
11 KV // Nov 6, 2008 at 8:39 pm
RE - I found the article and am reading it. I generally do not go to MSN, and did not know how it was organized. Trying to avoid learning!
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