Is Peak Oil a threat?

There are two camps about the peak of global oil production.
• Cornucopians, not only is the glass half-full, it is brimming over. There is no threat.
• Doomers, the glass is half-empty and we're draining it fast, industrial civilisation is going to collapse because there won't be enough oil to go around. A new Stone Age is right around the corner.

Both these "schools of thought" are wildly incorrect. It's not an accident that this kind of dichotomy exists. These are emotionally based positions which have little to do with Reality. Naturally there are many more Cornucopian’s than there are Doomers because mindless optimism is the default human position (mistake) in all matters, not just oil.

You can demolish both positions in two sentences.

Cornucopians do not know how to subtract.
Doomers do not know how to add.

Cornucopian’s can not acknowledge that oil fields peak and decline, and that global oil production might do the same. Doomers can not acknowledge that technology, exploration and wars in Iraq bring new resources on-stream. By and large, members of both groups know little about the global oil industry.

Without getting into the details, what can we conclude about peak oil going forward? You don't have to be a rocket scientist to understand:

1. Oil will never be cheap again. Even if demand falls off a cliff, producers require high prices to get new oil onstream to replace production declines. If demand is robust because the world economy is booming, as unlikely as that sounds right now, oil will get very expensive again in a hurry.

2. Industrial civilisation is not going to go out of business because oil is very expensive during the boom times and pricey (but not exorbitantly expensive) during the lulls. Peak oil acts more like a brake on global economic growth when times are good.

As usual, we'll know more in 10 years.

Certainly the longer term is fraught with difficulty if humans are depending on crude oil to fuel economic growth in the 21st century as it did in the 20th.

There is no peak oil crisis, nor is there any energy crisis nor was there ever one. There was never any water shortage as we found out after wasting billions on desal plants which now sit idle. There is infrastructure delay caused by pollies who chose to spend money on vote grabbers like the Sydney Olympics rather than much needed infrastructure upgrades.

There is no climate change, damaging sea level rises or increase in wild weather events.

There are excess amounts of food and room for plenty more people.

All these supposed impending catastrophes are simply a way of milking the public for more money by Govts and special interest groups who can control the media and therefore the population.

Or maybe you are a sucker, err believer.

BTW good post Hasbeen.

Right Geoff; and then there are the rational people who finish their drink and then pour another one.

Peak oil is a fabrication; the people advocating it can't envisage improvements in technology. Even the Saudis don't believe it:

http://www.adelaidenow.com.au/business/peak-oil-debate-is-over/story-e6frede3-1226354771053

Those improvements in technology not only apply to extraction and discovery but use as well. Efficiencies in use are inevitable as Ultra Supercritical coal technology shows.

I try not to comment on peak oil and AGW articles these days. There's not much new to say and the chance of changing anyone's view seems close to zero.

But good sense doesn't always win the day, so here goes. What if it is geologically impossible for the Earth to run out of oil? What if oil is not a fossil fuel but is actually abiotic, a product of the Earth's constantly evolutionary geology? There is a small but growing band of geologists who think this is the case.

Interesting eh?

Apart from a small number of posters, no one, including the pollies seems to get the fact that if you want to make people use/buy less of a particular commodity, in this case carbon, then you have to put the price up. You don't do this by compensating the buyers when the suppliers put the price up. Where is the incentive for the buyers, in this case the households of Australia, to cut back on their consumption of carbon. Surely blind Freddie can see that there will be no change to the energy consumption of 22 million of Australians in their houses and the electricity and gas companies will just keep putting their prices up to maintain their businesses as the government increases their taxes and churns the money back to the households.

Bloody clever not.

David

"as the government increases their taxes and churns the money back to the households."

The funds used by the government to compensate households for the impacts of this terrible tax, are in fact raised by the 'polluders' paying the tax. When the tax converts to a trading scheme where business can, instead of paying the tax, buy credits overseas, then there will be no more funds to compensate the punters.

Of course this government hopes to be reelected before that particular lump hits the fan.