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. European Union finance ministers are asking the Organization of Petroleum Exporting Countries to ramp up production when the Saudi-led cartel meets Monday in Vienna - despite the failure of similar boosts over the past year and a half. Skeptics say that won't work. ''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 Deffeyes. He uses a formula first developed to pinpoint with near accuracy 1971 as the start of oil production decline in the US. 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.
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 US Geological Survey has predicted that a peak in recoverable oil production won't come until 2037, and Saudi Oil Minister Ali Naimi recently declared that ''technological innovation will allow us to find and extract more oil around the world.'' Kenji Kobayashi of the global watchdog International Energy Agency wrote this year that global energy demand will grow by nearly 60% 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 Helmut Langanger, head of exploration and production at Austria's OMV oil company.
(Florida Times-Union 050916)
You know what I think? You want to know why there hasn't been any increase in refining capacity in North America for 20 years? You want to know why they're downplaying the fact that oil well discovery rates peaked globally in the 1980s? Why our domestic natural gas supply production growth rate has been in decline for a decade? Why there are no megafield projects scheduled to come onstream after 2008? It's because the oil companies know with great certainty that there isn't much dependable supply left, therefore they're attempting to fleece everyone in an attempt to siphon off as much profit as they can -- status quo is stable, baby. This may sound too simplistic, but the way finite-resource extracting industries work is unique. They're only working on one side of the equation -- all outputs. It's not like in our capitalist system a company is going to announce that they're running out of raw feedstock. It would destroy them. The oil companies want to avoid the same thing. They'll never admit they're running out of product. They're placing great blind faith in the concept that some magical energy source is going to come along and save us all. So is society in general. We can pick up some of the slack with nuclear power, wind, hydro and coal, but nothing comes even close to replacing everything to the scale we've become accustomed to globally. We're due for a huge economic and social contraction unlike anything seen in human history. Unless we can start buring the Dark Matter of course, or the Flying Spaghetti Monster sets us all straight.