There are many articles related to both fact and fiction about when the price of oil will become too expensive. When will oil peak and how can we know? Models predict both that we have plenty of oil while other predict just the oposite. Can statistics lie? who is right ... does anybody know?

“Can statistics lie?”

No. But people can. And some people delight in trying to make other people worry about anything and everything. So intent are they on bringing us down to their level of left-wing defeatism they will lie and lie and lie.

The human race has survived much worse things than the few piddling problems it faces today: the price of oil, the global warming fiction, a few sicko Muslims blowing themselves and mainly their own kind up. On and on it goes. There is plenty of doom and gloom out there if you wish to punish and embitter yourself by listening to it.

Envireconomic, have faith in your own ability to pull through and in that of the people who don’t moan and groan, but who work quietly in the background to come up with answers.

It’s a good life, for most of us, despite what you might read on OLO which has become, unfortunately, a magnet for the embittered and malcontent.

My wife studied statistics and probablity, and statistics can lie and they can be manipulated, and quite often are, it depends on how they are collected, collated, interperted and presented.
The old bar graph, pretty simple you would think, make it wider, thinner, higher, shorter, cut the bottom off, as you can see you can make it appear as anything you want.
100 years ago in New York the papers thundered against women in university "2 out of 3 women marry their professors " true, but what they failed to tell was that sample came from 1 university and there were only 3 female students, too small a sample too give a true picture. A recent statistic I read was 45% of accidents happen on straight roads and 16% on curves, pretty straight forward, but totally meaningless as you don't know what distance is travelled on straight and what on curves, or what % of roads are straight and what are curved.
Just a couple of examples of how you can manipulate data, one of her books I read was full of ways to do this sort of thing.
So as you can see statistics are quite often misleading.

fortunately, you can do a lot just by thinking: there's a fixed amount of oil in the ground. the first wells were just a water pump in an oily swamp. now, new wells are hard to find and difficult to pump. the easy stuff is gone. so the price of oil will certainly rise, and in an increasing curve.

then there's the waste products of using the stuff. this is certainly contributing to global warming, even if there are other factors. so there are strong reasons to start turning away from fossil fuel energy, even if the evidence is presented in bar charts.

Oil companies and governments spend more on trying to find oil than the value of what they find.

alanpoi says:
"Oil companies and governments spend more on trying to find oil than the value of what they find."

Speaking of people lying. What a load of rubbish. Public companies are not in the business of losing money. Why do you think the price at the pump is always changing. Really alan come on!

I think Leigh has summed up OLO very well. I came here looking for reasoned debate and have been very disappointed. All I have found is, as Leigh says so well, "left-wing defeatism" and "the embittered and malcontent".

As for statistics lying....yes easily done...look at the Hockey Stick.

Envirocomic;
There is no argument about whether peak oil is real or not.
The only argument is when.

When depends on a number of things.
The most important of them is the lies being told by the arabs about
their reserves.

Peak will be later than 2020 if they are telling little fibs.
Peak will be very soon, in the next 2 or 3 years or now if they are telling whoppers.

Aound this basic argument, there are all sorts ifs and buts regarding
future finds and their effect and so on and on.

As a point Australia's oil production peaked in 2000 and is now down
to about 60 % of the maximium flow. That is something that you can
read on the Australian Government Statistions web site.

So the economy rests on the arabs telling us the truth.
Either way we should be stuck in now on mitagation and the
transition to new energy sources.

They didn't mean to lose money, they were hoping to find more oil than they did, besides governments subsidise them, they get tax breaks for exploration. This was widely reported in the press last year.
What is your problem, anything that doesn't fit your narrow view of the world is all bullsh!t, oh and by the way I am just as p!ssed off that there are so many rabid right wing ratbags, spewing their bile out daily in OLO. You never come up with anything constructive just a never ending diatribe of derision and disbelief in anything other than your rosy misplaced view of reality.Anybody who disagrees with you is either a liar or a fool.

Tax breaks for exploration does not equate to the statement "Oil companies and governments spend more on trying to find oil than the value of what they find." Obviously a tax break is given to encourage more exploration. This in theory leads to more dicoveries. Which generates money for the company and the country. If the government got nothing out of the tax breaks why on earth would they give them?

Exploration needs to be encouraged if you're going to find more resources and this is not limited to oil or coal. You probably live in a house, drive a car, have some stuff. Where do you think it all comes from? A lot if it comes out of the ground. If you don't "value" your stuff why do you keep it? You should give it away and go live in a tree. I bet your place is full of stuff made from oil.

alanpoi says:
"You never come up with anything constructive just a never ending diatribe of derision and disbelief in anything other than your rosy misplaced view of reality."
You probably feel this way about a lot of people. Perhaps living in la-la land gives you this perspective.

alanpoi says:
"Anybody who disagrees with you is either a liar or a fool."
Finally something we can agree on.

You really are a total goat

Who cares? We shouldn't be worried about oil running out. The sooner the better. We should be worried about it not running out. The whole point of carbon trading schemes etc is that we don't burn every last drop. There are plenty of good alternatives and the world will not end if we have to pay a bit more for them. Europe already does and it doesn't cause them any problems.

alanpoi writes:
"You really are a total goat"

Ok I see you've lost it now. Don't mind him. He has a soft heart and a head to match.

"If the government got nothing out of the tax breaks why on earth would they give them?"

Votes. Donations to the party. There is no need to give tax breaks for exploration. Market mechanisms are more than capable of rewarding exploration.

"Exploration needs to be encouraged if you're going to find more resources and this is not limited to oil or coal."

No it doesn't. Resources will be sought without 'encouragement' from the government. That's like saying we will starve if the government doesn't grow the food for us.

Envireconmic, please don't concern yourself with the above "hot-heads." Lets focus on your questions instead.
In relation to the timing of peak oil, well I'm afraid nobody really knows, although it's widely believed to be before 2030. Our Prime Minister himself acknowledges 2035 as the date. Guesses as to exactly when oil will peak ranges from around 2000 right through to 2050. Some oil companies state oil will never peak in the forseeable future, but they may be a little biased, he,he! Unfortunately, we'll only recognise the peak well after it's happened.
The thing to realise about peak oil is the fact that we're NEVER going to run out of the stuff. "Peak" simply means that we've used exactly half of what was in the ground in the first place. That in turn means that what is left will be harder to find, more expensive to extract and will eventually not be able to match World wide requirements. This in turn equates to everything becoming increasingly expensive since the World is so reliant on cheap oil.
The upside is that other forms of energy will be developed giving rise to many more jobs. Should that fail and humanity realises that no known energy source can match that of oil, then we'll be forced into a lifestyle of less and less oil based products and more and more human intensive labour efforts to maintain some semblance of survival.
Doesen't sound too bad does it?

Well alzo old son before you go calling people liars I suggest you check the facts, try googling "value for oil" link 11 that is first link 2nd page, submission to Senate inquiry.
I can't find worldwide evidence yet, bit I am looking.
Unlike you I don't go around making stuff up.

alanpoi if you watched ABC's "Crude" last night you would have heard that oil produces 100 times more energy than is used to dig it up. Energy has a monetary value. Sounds like great value to me.

"...oil produces 100 times more energy than is used to dig it up. Energy has a monetary value."

And it was created for us - for free! We did not have to spend any time or money actually concentrating the enormous amount of energy available in the stuff, which is the main advantage it has over all other primary energy sources. People talk about so-called "free energy" which is essentially a perpetual energy scam; however oil is the real deal.

Mercury, it still costs to access it.

Yes we might run out of oil, but think about how we came to work out how to use oil in the first place (for those that did watch Crude). We ran out of sperm whales. We are an innovatice race. When oil runs out (or gets uneconomic) we will be forced to do something else, and we will find it. Eg Biodisel and ethanol. And as far as fuel goes, that at least is carbon neutral (eg grow and capture carbon from the air, then burn it and put it back).

Yes Country Gal, we will use some mix of both biodiesel and ethanol after oil becomes too expensive to extract from the ground. They'll still be plenty left down there, but too difficult for a number of reasons to extract, leading to the cost problems. However alternative fuels will never be enough to maintain our current wasteful lifestyles. I'm particularly talking about people expecting the "God given" right to drive a car.
We've created a society in the Western World whereby both women and men of a household work. Both need a car to get there, especially if one or both are shift workers. Then along comes Johnny and Jane, the children of the household who "damned well demand" the right to obtain a licence and a car. Neither biodiesel or ethanol will fill the gap of cheap oil. The sums simply don't add up.
On top of this, growing enough crops for biodiesel or ethanol must not be allowed to take up valuable arable land. We'll need it for food crops. I'd be pretty peeved if I was starving whilst some rich moron was driving around in a car running on ethanol derived from corn just because he could. In the United States, ethanol production is already having a dramatic effect on the price of grain.
But, I too believe in innovation and strongly believe that if we recognise the problem the end of cheap oil represents and move NOW to head off a disaster, we can learn to live happily enough in a World of greatly diminished energy supply. Our present wasteful lifestyles must end,either by our own design or by nature's. I know which path I'd rather take.

"Mercury, it still costs to access it.

Yes we might run out of oil, but think about how we came to work out how to use oil in the first place (for those that did watch Crude). We ran out of sperm whales. We are an innovatice race. When oil runs out (or gets uneconomic) we will be forced to do something else, and we will find it. Eg Biodisel and ethanol. And as far as fuel goes, that at least is carbon neutral (eg grow and capture carbon from the air, then burn it and put it back)."

Production costs for oil are miniscule in comparison to renewables like biofuels which at best provide only a marginal return on energy invested. Not to mention all the environmental impacts that biofuel production makes during its lifecycle. Besides there are no “alternatives” in energy. No new energy source we've ever come across has ever completely replaced its predecessor(s). Only added to the mix of energy types in use. For instance when coal supplanted the burning of biomass was the latter replaced? No, the burning of wood is still an important source of energy for a significant part of the world's population. And when oil replaced coal, did we just stop using it? No.

Giant wind farms and solar panel arrays being installed now are not actually retiring existing fossil fuels, just supplementing them. Why? Because exponential economic and population growth means we altogether need to use more energy in order to support us. However industrial society was built on, and relies completely on non-renewable fossil fuels, with oil the master resources. It is widely believed that all these fuels will be commercially worked out within 50 years, because our reliance on them is actually increasing as was pointed out in the documentary, now that the Indians and Chinese are climbing onto the modern consumption bandwagon. Why is it increasing? Because of the incredible amount of cheap energy that is released from burning them.

aime is right
If you took all the food you bought for a week, put it through your food processer, then put it in your fuel tank, how would it compare to the amount of fuel you buy? I think you would find that you bought a greater volume of fuel than food.
That is not taking into account that the volume of food if processed for bio-diesel or ethanol would only make a fraction of the fuel you bought.
Considering that domestic use of oil accounts for well under 50% of all oil used, you can see by this simple example that alternative fuel will never a be a substitute except for a small percentage.
We could never grow enough and feed ourselves unless we halved the population, and that is a distinct possibility.
Oh and by the way aime I just get a bit stirred up when I get called a liar for quoting something I read in a reputable daily newspaper.

Mercury said.... "Production costs for oil are miniscule in comparison to renewables like biofuels which at best provide only a marginal return on energy invested."
Yes Mercury, you've hit the nail squarely on the head. It's usually written as EROEI which means 'Energy Returned On Energy Invested' and exactly just why the "Hydrogen Economy" will never fulfill the dreams of it's exponents. At present it takes more energy to create, store and transport liquid hydrogen than the energy derived from it.
The best chance mankind has, is to invest in greater use of electricity. ie: The extension of electric train infrastructure and more use of small electric commuter vehicles strictly for those who cannot use an alternative method of commuting.
The trouble is, that we need to invest strongly in R&D in this country BEFORE oil becomes ridiculously expensive, but our present Government blunders along with bandaged eyes. I seriously doubt a change to Labor will be any better. Governments won't do a thing that might upset their precious "economy." CSIRO in conjunction with Origin Energy developed wafer thin solar cells and wanted Government assistance to develop them to the commercial stage, but Howard wouldn't hear of it. Now, it looks as though we'll have to buy them from overseas at a higher margin. So much for clever Australia.
Big oil runs not only our Government, it runs the World. The quicker it bites the dust, the better for humanity.
Just getting back to Envireconmic's original post re: statistics, there are no reliable statistics on World oil decline rates. Nobody producing oil wants you to know. Why? While the myth of perpetual oil holds out, big oil companies are lining their greedy pockets with obscene amounts of money and passing no small amount on to willing Governments. Those same Governments will never burst the oil myth for fear of reprisals from the voters or worst, total civil disobedience. People like Matt Simmons have gone a long way towards some semblance of statistical data, but much of it is still guesswork.
Envireconmic, I hope you got something out of your post.

Hey! No problems Alanpoi :-)
As I've found out since I got seriously interested in the theory of "peak oil", it's a very emotive area. I've largely given up on trying to educate people about the possible dangers of heading into a future of ever decreasing oil supply. You should see some of the looks I get at work. I've been met with any level of skepticism right through to outright hostility......and this from fellow nurses who you'd think would be a little more excepting. I guess nobody want to face the fact that the lifestyle they love so much might one day in the near future be ripped away from them.
I've downsized my lifestyle considerably in the last few years, but continue to enjoy some modern conveniences while I can. I'd hate to be without my computer or my fridge & freezer and since I live out of town, I really need my little car to get to work. They tore up the train tracks 15-20 years ago to make us even more dependent on oil. I earnestly hope that one day those same people responsible for that folly will sit back and lament the fact that what they did was a terrible act, but that's doubtful. Those who make such environmental mistakes belong to the rich and powerful club. They'll always be able to afford fuel of whatever breed to get them around in luxury.

giv'em hell aime.

that's one of the reasons i press for democracy- pollies lead us into this dependence on fossil fuel, they won't lead us away fast enough.

electric vehicles, powered by sunshine collected off your roof and stored in batteries, are already close to competitive with petroil technology. just needs more r & d money, and the constricting availability of oil, before everyone will see it.

pollies will see it last, because they are looking at the corporations that finance election campaigns.

Aime, I agree with the need for R&D now, so that we a solution when supply runs out (or just gets far too expensive). Whilst I think we are smart enough to come up with a solution, its better to have it ready to go, than to start behind the 8-ball.

One of the problems that I foresee, particularly in Australia, is how seperated by distance we are. Your example of needing cars to get to work fits me like a glove. I live in a regional town, and my husband works out of town. There is no way we could get two incomes with having two cars (although we only use the one if it happens to be possible on a particular day).

Another issue that will arise will be the cost of food. We are used to very cheap food in this country and run a real risk of the price of oil pushing up the cost of production (for tractors, pumps, spray rigs etc) and the cost of transport.

Ahh, electric cars, a favorite subject of mine.
The following steps need to be taken now.
1.
To reach the situation where we have electric cars for short range (50km)
radius trips the government needs to accept changes to the Australian
design rules right now.
2.
They need to stop funding roads immeadiatly and pour as much money as
possible into electrified railways.
3.
Introduce petrol rationing now. (This will free up foreign currency
costs from oil imports)
5.
Stop manufacture of internal combustion engine cars for private use
and startup manufacture of electric cars. Emergency services only.

Having done this we should have the time to get suffient photocell
systems designed and installed as people change from their present
cars to electric cars.
With a photocell distributed power system the cars would be run without much
in the way of other energy demand.
If we started right now we might just scrape in in about 10 years.

The problem is which party would make that their policy for the next election ?

Unless we make steps like this now we will not have the resourses and energy
to make the transition to a new economic system.
I am pessimistic that we will start soon enough to enable civilisation
in its modified form to survive.

"The problem is which party would make that their policy for the next election ?"

Maybe the Greens? I certainly wouldn't vote for such a scheme and I suspect neither would the majority...ahhh thank goodness the majority still control the country.

Bazz the problem I see with point 2. and 5. is they seem to be city centric. How do you propose rural people get to work or town etc.

"Introduce petrol rationing now. "

Rationing has no place in modern society. Taxing works a lot better.

Taxing would be unfair to lower income people, and there will a lot
of them. The tax would have to be very high to bring about the sort
of needed reduction.

The point about electrification of railways and their expansion would
mainly be in the country. Long distance trucks will be out of business
anyway.

As far as getting into town, well how do you propose to do that anyway ?
Eventually there won't be the fuel to drive into town and you won't be
able to afford it even if you can get it.

You might be able to make your own bio diesal which some farmers already
do in some places.
Otherwise look around for a sulky.

"Taxing would be unfair to lower income people, and there will a lot
of them."

It would be no more 'unfair' than making poor people pay for their own rent, land, food etc. There are ways to amke sure poor people are not treated unfairly in our society. Rationing resources is not one of them, for very good reasons. Petrol and electricity are not fundamental human rights. As part of a suitably targetted green tax shift, poor people would not be any worse off.

"The tax would have to be very high to bring about the sort of needed reduction."

Depends what you mean by 'very.' A doubling of the price of electricity would be more than enough.

Freediver;
You will notice that my rationing was intended to stop crude oil import.
This includes all crude products.
This means a reduction in use of 40% plus this year.
To get a reduction of that magnitude by taxing might mean $10 a litre.

By using the Access card each person or vehicle would have to insert
their Access card into the pump. The amount of fuel purchased would
be deducted from their rationing record.
The amount of fuel available would be set once a year and reduced by
the depletion rate, which is about 4%.

The money saved on imports would be spent on rail for long distant
freight and passenger transport and for public transport generally.

In the long term this will happen, so lets get a head start while we
have the resources to make the changes needed.

"This means a reduction in use of 40% plus this year.
To get a reduction of that magnitude by taxing might mean $10 a litre."

I doubt it, but if that is what it takes, you would get a rise in the price of fuel of $10 per litre by limiting imports, the only difference being that you could not offset it by lowering other taxes. If you tried to do it by rationing fuel to this level you would just create a black market where fuel costs even more than $10 per litre. It's a really really bad idea. It has no place in the modern world.

"In the long term this will happen"

The price will go up. I guarantee you we won't ration fuel. The public tolerates a limited form of water rationing, but only because they don't realise how insiginifcant their efforts are compared to the waste from industry and agriculture.

I used to work in the oil industry and had an oil rig to service. It was well known that there is plenty of oil, but it was industry policy to cap it and use up the Arabs oil first.
I have never belived in Peak oil because I know that there are thousands of capped wells plus with more modern technology now, more oil is being found yearly. The recent finds in Colorardo are a small example of this. Besides, with technology we already have we dont need to use any oil to power our needs. We are surrounded by Hydrogen and this can be used in most existing engines. I have attended a demo where the Hydrogen was made as the engine ran, so it must be possible. There are many other forms of energy making fuels such as Magnetic, solar with hydrogen back up, wave power etc.
Here in Australia, we have more fossil energy than we can use, so we are self sufficient.
I am also aware of the renewing therory that says that oil comes from Bacteria way down in the Earths crust, so maybe we will soon see whether this is true too.

Being a sailing tragic, maybe yet in my lifetime I will get to see those graceful clipper ships taking Australian produce to the world again!

Matter of fact, if we all slowed down a little, we might suddenly find there is a life to be had out there instead of being, as Sterling Hayden wrote in his wonderful autobiography "Wanderer":-

"What does a man need - really need?

A few pounds of food each day, heat and shelter, six feet to lie down in - and some form of working activity that will yield a sense of accomplishment.

That's all - in the material sense, and we know it. But we are brainwashed by our economic system until we end up in a tomb beneath a pyramid of time payments, mortgages, preposterous gadgetry, playthings that divert our attention for the sheer idiocy of the charade.

The years thunder by, The dreams of youth grow dim where they lie caked in dust on the shelves of patience. Before we know it, the tomb is sealed.

Where, then, lies the answer?

In choice.

Which shall it be: bankruptcy of purse or bankruptcy of life?"

Smart man Captain Hayden!

This from ASPO Australia and Phil Hart. (Phil Hart is a Petroleum Facilities Engineer)
In Asia, crude oil has reached $79 a barrel, just three dollars shy of record highs. There should be no surprise that we are repeating last year's pain at the petrol pump. “Refinery constraints in the US are one aspect of a tight petroleum supply chain, but the main contributor to high petrol prices is a faltering supply of crude oil”, says Hart.

While Hart is not prepared to call this 'peak oil' just yet, as production might recover to post marginal gains over the next year or two, the message is clear. “The world's fast depleting oil resources will not allow for the kind of continuous growth in supply that economists are counting on”.

“High prices are the market signal that we urgently need transport and city planning that will reduce our oil dependence. Suggesting that high prices are temporary misleads the public and allows governments to delay difficult decisions”.
Full report link....
http://www.aspo-australia.org.au/content/view/170/9/