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Leanan
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 Posted: Tue Oct 30, 2007 8:53 am Post subject: Oil production has peaked, prices to soar - Sadad al-Huseini |
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| Quote: | Sadad al-Huseini says that global production has reached its maximum sustainable plateau and that output will start to fall within 15 years, by which time the world’s oil resources will be “very severely depleted”.
In an exclusive interview with lastoilshock.com, the former head of exploration and production at Saudi Aramco, said that oil production had reached a structural ceiling determined by geology rather than geopolitics, and that the technical floor for the oil price will rise by $12 annually for the next 4 to 5 years as new fields become increasingly costly to exploit. |
Podcast at David Stahan's blog:
http://www.davidstrahan.com/blog/?p=67
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AirlinePilot
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| Posted: Tue Oct 30, 2007 9:11 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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"Output will start to fall within 15 years"
I have to just shake my head and walk away. That alone sounds like desperate optimism. It's going to be very interesting and look back at all this in 5 to 10 years and see where we really are.
Somehow I don't believe the plateau idea has a snowball's chance in hell. |
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Eli
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| Posted: Tue Oct 30, 2007 9:24 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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Like the new avatar AP much better than that goofball standing in front of that Jet 
Man 10 to 15 years would be great, someone needs to tell everyone in the ME to stop having babies right now. So screwed, even that would be great if the ME countries were not increasingly keeping their oil at home.
And if I am the head of a major producer and realize where we are at when do I make the decision to just worry about my own country. The way producer nations act and behave is going to drastically change over night. |
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Novus
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Joined: Jun 21, 2005
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| Posted: Tue Oct 30, 2007 9:35 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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The plateau started in 2004. The price of oil has more than doubled since then and now at the end of 2007 production numbers are pretty much the same. That is by definition Peak Oil. History has already been written and it says in no uncertain terms: Market forces are defeated, Peak Oil is real, it is here, it is NOW. In all honesty I don't think we have 5 to 10 years. In three years or less for all practical purposes the world we are living in now will have ended.
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jbeckton
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| Posted: Tue Oct 30, 2007 9:43 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| AirlinePilot wrote: | "Output will start to fall within 15 years"
I have to just shake my head and walk away. That alone sounds like desperate optimism. It's going to be very interesting and look back at all this in 5 to 10 years and see where we really are.
Somehow I don't believe the plateau idea has a snowball's chance in hell. |
You are looking much better these days AP.
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jbeckton
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| Posted: Tue Oct 30, 2007 9:46 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| Eli wrote: | | And if I am the head of a major producer and realize where we are at when do I make the decision to just worry about my own country. The way producer nations act and behave is going to drastically change over night. |
They have been selling their countries soul for decades, what makes you think they will stop. The Sheiks need their billion dollar jets as much as we need oil.
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billp
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| Posted: Tue Oct 30, 2007 10:12 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| Quote: | | In all honesty I don't think we have 5 to 10 years. In three years or less for all practical purposes the world we are living in now will have ended. |
If the normal distribution model for oil production is correct, then production slope deceleration is maximum at peak. This argues for rapid decline in production, rather than a plateau, from the peak.
But there are lots of things which could change what happens.
Like an attack on Iran. |
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jbeckton
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| Posted: Tue Oct 30, 2007 10:17 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| billp wrote: |
If the normal distribution model for oil production is correct, then production slope deceleration is maximum at peak. This argues for rapid decline in production, rather than a plateau, from the peak. |
I don't think that the actual curve will represent the normal distribution bell shaped curve, there are too many factors in play. They just use that curve to make predictions and models because the math is much easier/possible.
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WildRose
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| Posted: Tue Oct 30, 2007 10:55 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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I also can't see how we could possibly go 15 years until output would start decreasing. I mean, look at oil prices now, and is demand declining? North America and China are still full-speed ahead! Combine that with depletion rates that are predicted for all the major fields, and I think output will be much smaller, much sooner than that.
P.S. AP - I prefer your previous avatar!
edited grammatical error
Last edited by WildRose on Tue Oct 30, 2007 12:23 pm; edited 1 time in total |
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aflurry
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Joined: Mar 28, 2005
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| Posted: Tue Oct 30, 2007 11:28 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| billp wrote: |
If the normal distribution model for oil production is correct, then production slope deceleration is maximum at peak. |
It is a line graph of production through time, not a statistical distribution graph. The resemblance is superficial and coincidental.
However, despite the apples and oranges comparison, i do think your comment that in the projected curve, the deceleration of the slope is greatest at peak is still true and is a good argument against a prolonged plateau.
The only convincing plateau theory I have heard is the "bumpy plateau" idea, where the collapse of more fragile economies provides little bits of demand destruction as we enter into the decline proper. However, the term "bumpy" in this scenario is a serious euphemism.
edit: maybe i should rephrase my first paragraph as a question so as not to sound like a dumbass. what i mean is, why do we relate the oil production graph to a normal distribution curve, and is this valid? because it SEEMS to me that the resemblance is only superficial and coincidental and that plotting a linear production rate through time is just a completely different thing than plotting relative statistical frequency. so, if it is only a superficial resemblance, how can predictions based on the normal distribution curve carry any weight at all?
even within statistics there are plenty of other curves with different skew, or that are bounded on the upper or lower end. but really the issue is whether this kind of statistics is even relevant at all.
Last edited by aflurry on Tue Oct 30, 2007 11:39 am; edited 1 time in total |
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seahorse2
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| Posted: Tue Oct 30, 2007 11:29 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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Let's compare Sadad's recent statement with statements he made in an interview back in 2005.
Energybulletin
In the 2005 interview, he said:
| Quote: | | Oil capacity today is not production limited but rather processing limited. |
Now, he says:
| Quote: | | oil production had reached a structural ceiling determined by geology rather than geopolitics |
In 2005 he said:
| Quote: | | I believe oil production will level off at around the 90 - 95 mmbd by 2015. This plateau can be sustained beyond 2020 at continuously higher oil prices and with rapid improvements in overall energy efficiencies throughout the world. |
Now he says:
| Quote: | | that global production has reached its maximum sustainable plateau and that output will start to fall within 15 years |
Seems like he has become a bit more pessimistic over the last two years, or, maybe a little more candid (honest). We report, you decide. |
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frankthetank
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Location: Southwest WI
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| Posted: Tue Oct 30, 2007 11:50 am Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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Just for a refresher, if we look at productions from 1987 (~58 Mbpd) will it be similar to that in 2027?
I know all the other variables have changed (population/etc).
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Eli
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Joined: Jun 18, 2005
Posts: 3909
Location: In a van down by the river
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| Posted: Tue Oct 30, 2007 12:15 pm Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| jbeckton wrote: | | Eli wrote: | | And if I am the head of a major producer and realize where we are at when do I make the decision to just worry about my own country. The way producer nations act and behave is going to drastically change over night. |
They have been selling their countries soul for decades, what makes you think they will stop. The Sheiks need their billion dollar jets as much as we need oil. |
Well they have some of the fastest population growth rates in the world and they are consuming more and more oil at home. Things have changed.
If I am Saudi Royal I might think it is important to keep gas prices low so I can stay in power rather than ship off all my oil. |
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Eli
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Location: In a van down by the river
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| Posted: Tue Oct 30, 2007 12:17 pm Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| jbeckton wrote: | | Eli wrote: | | And if I am the head of a major producer and realize where we are at when do I make the decision to just worry about my own country. The way producer nations act and behave is going to drastically change over night. |
They have been selling their countries soul for decades, what makes you think they will stop. The Sheiks need their billion dollar jets as much as we need oil. |
Well they have some of the fastest population growth rates in the world and they are consuming more and more oil at home. Things have changed.
If I am Saudi Royal I might think it is important to keep gas prices low so I can stay in power rather than ship off all my oil. |
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jbeckton
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Posts: 1920
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| Posted: Tue Oct 30, 2007 12:32 pm Post subject: Re: Oil production has peaked, prices to soar - Sadad al-Hus |
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| Eli wrote: |
If I am Saudi Royal I might think it is important to keep gas prices low so I can stay in power rather than ship off all my oil. |
Apply your logic to the history of OPEC. If they stop exporting, they will risk attacks. They have lived in extravagant palaces for decades while the people have suffered. Now the money is even better!
They will sell every last drop while the money is there.
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Those that cannot do..... teach. Those that cannot teach......teach gym.-Jack black |
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