Speed of decline

Ludi · Posted: Fri Apr 29, 2005 4:33 am Post subject: Speed of decline

I need to check something I'm not sure I'm understanding properly. According tothis link

world oil supply will decline by approx 62% in 33 years, or about 2% a year.

According to this link

worldwide demand is expected to rise at about 3%.

So, if I'm understanding this, after peak, the first year or thereabouts, there will be a 5% lack of oil to meet demand, 7% the next year, 9% the next, etc.

Is this correct or am I missing something critical?

I hope someone will clear this up for me.

Ludi · Posted: Fri Apr 29, 2005 6:28 am Post subject:

Wait a minute, if demand increase 3% a year, wouldn't it be more like

1st year 5%
2nd year 10%
3rd year 15%

That can't be right, can it? What am I missing?

clv101 · Posted: Fri Apr 29, 2005 6:37 am Post subject:

After the first year of supply not meeting demand and prices shooting up, demand will fall considerably, the 9% year after etc will never be seen. Over the last few months I've changed my mind somewhat about peak oil... in the short-medium term I don't think peak oil is really an energy problem. It's an economic problem. Whatever happens price will rise, this will increase the cost of doing business, inflation and interest rates will increase, businesses will fail, unemployment will rise, equity and housing markets will crash, savings and pensions will be gone...

Even 10 years post peak I wouldn't be surprised to see plenty of oil available, maybe even at reasonable prices but the damage will have been done. The oil may be available but the unemployed won't be able to afford it.

In the long term 20+ years, peak oil is a fundamental energy problem but over the next decade or so I think depression induced demand destruction will outpace the declining production rates.

This is not to belittle the problem – economic failure is just how the problem will be expressed.
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The Oil Drum: Europe

Ludi · Posted: Fri Apr 29, 2005 6:48 am Post subject:

I agree with you, I'm just trying to use these figures to convince someone else of this problem, and how it will destroy the economy. They don't believe me and think alternatives will make up the shortfall.

Aaron · Posted: Fri Apr 29, 2005 6:57 am Post subject:

This assumes that historic depletion rates will occur like in the lower 48 US.

Many, (myself included), think that is unlikely because of MRE.

Think 10% +
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Ludi · Posted: Fri Apr 29, 2005 7:00 am Post subject:

Can you explain that in a little more detail Aaron?

clv101 · Posted: Fri Apr 29, 2005 7:05 am Post subject:

Put simply, advanced technology doesn't increase the ultimate recoverable reserves much. What it does is allow a higher rate of production to be maintained for longer. However when production does start to decline, the decline is rapid.

Much of world production now comes from fields using advanced technology.

Both Colin Campbell and Matthew Simmons said this in Edinburgh:
http://www.peakoil.com/fortopic7398.html
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"Everything is proceeding as I have foreseen." The Emperor (Return of the Jedi)
The Oil Drum: Europe

Aaron · Posted: Fri Apr 29, 2005 7:17 am Post subject:

What he said Smile

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"When you understand why you dismiss all the other possible gods, you will understand why I dismiss yours." - Stephen F Roberts.

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pea-jay · Posted: Fri Apr 29, 2005 9:24 am Post subject:

Antimatter · Posted: Fri Apr 29, 2005 10:00 am Post subject:

Depletion at 10% + per year would mean a URR far smaller than Campbell et al predicts.

clv101 · Posted: Fri Apr 29, 2005 10:23 am Post subject:

Indeed... but we have to remember that the URR isn't fixed, it depends on the method of production. If production is fast then URR is lower than if production is slower.
_________________
"Everything is proceeding as I have foreseen." The Emperor (Return of the Jedi)
The Oil Drum: Europe

Aaron · Posted: Fri Apr 29, 2005 10:35 am Post subject:

Oman
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"When you understand why you dismiss all the other possible gods, you will understand why I dismiss yours." - Stephen F Roberts.

Praise HawkMan

Ludi · Posted: Fri Apr 29, 2005 10:39 am Post subject:

Thanks for clarifying.

johnmarkos · Posted: Fri Apr 29, 2005 12:02 pm Post subject:

JoeW · Posted: Fri Apr 29, 2005 12:07 pm Post subject: