The idea of Peak Oil is actually quite simple. Imagine that all our world's oil was gathered together in one big tank. At some point in time, we will have used up half of that oil. Peak Oil attempts to determine when this "mid-point" or “Peak” will be reached, & how rapid the decline in oil production will be after this “Peak” has passed. Many business & government interests speculate that this mid-point (Peak) is decades away, but independent researchers & analysts disagree, claiming Peak Oil will happen much sooner. Little valid disagreement exists over Peak Oil itself, rather arguments center around when Peak Oil will occur.
Peak Oil : Any finite resource,
(including oil), will have a beginning, middle, and an end of
production, and at some point it will reach a level of maximum output as
seen in the graph to the left.
Oil production typically follows a bell shaped curve
when charted on a graph, with the peak of production occurring when
approximately half of the oil has been extracted. With some exceptions,
this holds true for a single well, a whole field, an entire region, and
presumably the world. The underlying reasons are many and beyond the
scope of this primer, suffice to say that oil becomes more difficult and
expensive to extract as a field ages past the mid-point of its life.
In the US for example, oil production grew steadily
until 1970 and declined thereafter, regardless of market price or
improved technologies.
In 1956 M. King Hubbert, a geologist for Shell Oil, predicted the
peaking of US Oil production would occur in the late 1960's.
Although derided by most in the industry he was correct. He was the
first to assert that oil discovery, and therefore production, would
follow a bell shaped curve over its life. After his success in
forecasting the US peak, this analysis became known as the Hubbert's
Peak.
- The amount of oil discovered in the US has dropped since the late
1930s.
- 40 years later, US oil production had peaked, and has fallen ever
since.
World discovery of oil peaked in the 1960s, and has declined
since then. If the 40 year cycle seen in the US holds true for world oil
production, that puts global peak oil production, right about now; after
which oil becomes less available, and more expensive.
Today we consume around 4 times as much oil as we discover.
If we apply Hubbert's Peak to world oil production we estimate that
approximately half of all oil that will be recovered, has been
recovered, and oil production may reach a peak in the near future, or
perhaps already has.
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