World Oil Peak

This graph appeared in the May 2003 newsletter of Association for the Study of Peak Oil. [1]

The General Depletion Picture
Oil and Natural Gas Liquids
2003 Base Case Scenario
[world oil peak]

Here is the Hubbert curve for the whole Earth, the chart that puts it all together. The part before 2003 is historical fact. The part that comes afterward is extrapolation. Note the peak in production of US-48 oil occurs before all of the other peaks. Note the sliver of white representing Alaskan Prudhoe Bay oil, which peaked in 1990. Note the effect of the 1973 OPEC oil embargo. Note the effect of improved fuel economy of automobiles along with stagflation in the 1980s. Note the effect of the collapse of the Russian economy on Russian oil production. Note the rapid increase in production when the world economy boomed near the end of the twentieth century. Note that European (North Sea) oil peaked in 2000. Note especially what would have happened if the 1973 embargo had not occurred. The world would now be on the steep part of the right side of the bell curve.

World oil production is predicted to increase 2 or 3% per year after 2003 mainly due to demand from China and India. The sliver of white after 2003 represents Siberian oil but could also include Alaskan Northern Wildlife Refuge (ANWR) oil. Natural gas condensates and heavy oil become more important. But in 2010 something happens. The Middle East can no longer compensate for declining production elsewhere. Production and therefore consumption will decrease and demand will have little effect on production. The decrease results from oil depletion and the realities of geology. Large increases in the price of oil will not greatly increase production but would reduce demand. Countries with no alternatives to oil consumption will be forced to bid up the price of oil.

OPEC Oil Here is a graph that presents the same data but the format emphasizes how OPEC will come to dominate world oil production.

The Bush Administration National Energy Policy Development (NEPD) report does not contradict the basic facts. [2] Here is an excerpt from page 5-3:

Oil and Natural Gas

Oil and natural gas are the dominant fuels in the U.S. economy, providing 62 percent of the nation’s energy and almost 100 percent of its transportation fuels. By 2020, the Energy Information Administration expects the United States will need about 50 percent more natural gas and one-third more oil to meet demand.

U.S. oil production is expected to decline over the next two decades. Over the same period, demand for natural gas will most likely continue to outpace domestic production. As a result, the United States will rely increasingly on imports of both natural gas and oil from Canada, and imports of oil and liquefied natural gas from producers across the globe.

21st Century Technology

Remaining U.S. oil reserves are becoming increasingly costly to produce because much of the lower-cost oil has already been largely recovered. The remaining resources have higher exploration and production costs and greater technical challenges, because they are located in geologically complex reservoirs, (e.g., deep water. . .

The NEPD report does not venture a guess about what will happen when the United States can't get oil.

No oil geologist seriously disputes the conclusion that oil consumption will peak soon. Studies place the peak year any time between 2006 and 2022, depending on optimism and assumptions. Others may dispute this conclusion but they are usually economists or politicians.

[1] http://www.asponews.org/ Association for the Study of Peak Oil.

[2] http://www.whitehouse.gov/energy/ A report from the National Energy Policy Development (NEPD) group appears on the energy section of Bush Administration White House website.