[Voice_du_More]

http://www.theoildrum.com/files/ccst20090515.png

It is starting to sound to me like we may actually see some official announcements of peak oil in 2008 coming out soon. Just wondering what you guys think. Will the EIA, and IEA call peak, should they, should'nt they, do they have enough data, can they swallow their pride and give us all the nudge in the right direction that such an announcement would be?

Other than OilFinder, how are you all seeing this new data?

[I'm joking OF, of course I want to hear your take as well.]

Also they are talking about a 3.4% decline per year after 2010, http://www.theoildrum.com/node/5395#more That ought to be a very significant upward price push at least. Are they talking about offsetting these declines with LNG or something?

It seems to me that the world cannot grow it's modern western economy if the good stuff is declining at 3.4% per year, something is going to have to give and rather soon.

Anyone want to estimate the probability of an official fireside chat in Carter red to let the nation and the world know that the fat lady has sung?

[mos6507]

Demand is depressed. Tankers are stranded with nowhere to dump their extra oil. Oil production figures at this time mean nothing as far as geological constraints go. Oil production charts are TOD's bread and butter but unfortunately this sort of chart watching has been proven much too simplistic in light of the credit crisis.

[copious.abundance]

t is starting to sound to me like we may actually see some official announcements of peak oil in 2008 coming out soon. Just wondering what you guys think. Will the EIA, and IEA call peak, should they, should'nt they, do they have enough data, can they swallow their pride and give us all the nudge in the right direction that such an announcement would be?

Other than OilFinder, how are you all seeing this new data?

[I'm joking OF, of course I want to hear your take as well.]

You're late:
http://peakoil.com/peak-oil-discussion/ ... 51703.html

All I can say is, an analysis made by ace on TOD has even less credibility than one made by Matt SImmons.

[AirlinePilot]

While I'd say we will have a very difficult time going back towards where we were production wise last year, it may not be impossible. I do believe there is a much greater probability that we dont go much higher than where we were anytime soon. At some point, decline is going to outpace global production growths ability to climb. I believe we are going to see this within the next few years.

I also believe personally that we may never get above where we are now for a variety of reasons. However until there is real transparency from Saudi Arabia this is a tough argument to make. It is still possible for a final big push, given some very lucky or serendipitous economic moves. This push could put us near the high 80's to near 90mbpd I think but it would be a last gasp so to speak. As i've been arguing with our resident cornies here, show me the oil! Show me the huge discoveries that are required to get the production up YOY. The gap between discovery and production has been diverging for many years.

The bottom line is its getting close, but there still is too much uncertainty to claim that this is it. I believe we will know definitively by sometime late next year or into early 2011. By then it will likely be obvious that decline is going to win and any economic driven demand collapse will not outpace the decline. If it does we have much larger issues to deal with.

[AirlinePilot]

All I can say is, an analysis made by ace on TOD has even less credibility than one made by Matt SImmons.

In making this statement you completely destroy any credibility you might hope to retain in these discussions. You cant even hold a candle to the kind of research that gentleman has done over there. Instead of libeling the man why not refute his argument OF? Seriously.

[copious.abundance]

In making this statement you completely destroy any credibility you might hope to retain in these discussions. You cant even hold a candle to the kind of research that gentleman has done over there. Instead of libeling the man why not refute his argument OF? Seriously.

OK, here we go.

For example, in this thread here on TOD from August 5, 2007, ace boldly and confidently forecasts that world crude and condensate production would steadily decline to about 72 million bpd in 2008, then really go downhill from there. (chart).

Alas, it didn't turn out that way. We had a supposedly impossible ramp up to almost 75 million bpd last summer. If it hadn't been for the economic crash, it would have continued.



Unfortunately his threads only go back to 2007 so it isn't possible to examine older forecasts he's made, but I'm sure his recent ones will prove to be entertaining in the future.

[Voice_du_More]

While I'd say we will have a very difficult time going back towards where we were production wise last year, it may not be impossible. I do believe there is a much greater probability that we dont go much higher than where we were anytime soon. At some point, decline is going to outpace global production growths ability to climb. I believe we are going to see this within the next few years.

I also believe personally that we may never get above where we are now for a variety of reasons. However until there is real transparency from Saudi Arabia this is a tough argument to make. It is still possible for a final big push, given some very lucky or serendipitous economic moves. This push could put us near the high 80's to near 90mbpd I think but it would be a last gasp so to speak. As i've been arguing with our resident cornies here, show me the oil! Show me the huge discoveries that are required to get the production up YOY. The gap between discovery and production has been diverging for many years.

The bottom line is its getting close, but there still is too much uncertainty to claim that this is it. I believe we will know definitively by sometime late next year or into early 2011. By then it will likely be obvious that decline is going to win and any economic driven demand collapse will not outpace the decline. If it does we have much larger issues to deal with.

So, you essentially agree that by 2012, just three years away the goose is cooked. If anyone in power knows that we can expect nothing but more and more draconian government into the future, IMHO. Also I agree completely, even the foggy picture we seem to have says any recovery is going to send oil through the roof because depletion and nationalization are going to bite harder and harder and we all know it.

I am going to go out on a limb and predict a miny spike this summer. I think the people in the pit are going to understand the data as fuzzy as it appears and there are going to be alot of players trying to hoard oil.

this will be a good test, I expect $100 by september on some unexpected news and a couple moderately harmful hurricanes in the gulf. I would not be surprised to see a super spike emmerge off of that into 2010 because the tendency with something like this is for everyone to try to keep it under wraps and cover their buttes while the thinkers try to find a way out of it.

My doomometer is pegged right now and I am thinking Canadian employment sounds real good. I am absolutely certain that the United States as I know it cannot survive a 10% decline in world oil production between now and 2012 and I have reason to believe that decline is an underestimate.

BTW OF must be on someone's payroll. Have we considered he might be Danny Yergin?

Sorry Dan! I know you have acquired the peak oil religion recently, I just couldn't help it.

[Voice_du_More]

In making this statement you completely destroy any credibility you might hope to retain in these discussions. You cant even hold a candle to the kind of research that gentleman has done over there. Instead of libeling the man why not refute his argument OF? Seriously.

OK, here we go.

For example, in this thread here on TOD from August 5, 2007, ace boldly and confidently forecasts that world crude and condensate production would steadily decline to about 72 million bpd in 2008, then really go downhill from there. (chart).

Alas, it didn't turn out that way. We had a supposedly impossible ramp up to almost 75 million bpd last summer. If it hadn't been for the economic crash, it would have continued.



Unfortunately his threads only go back to 2007 so it isn't possible to examine older forecasts he's made, but I'm sure his recent ones will prove to be entertaining in the future.

Have you ever considered that the economic crash has been at least partly caused by the run up in oil prices and that the recession is actually coming at just about the right time to hide peak oil? Have you ever looke closely at the predicted output form Iraq past 2012 and thought that it was quite odd that Iraq somehow factored into PNAC back in 1999. Imagine if we were here today and Saddam were still in control of Iraq, I'll bet Paul and Don imagined that very thing in 1998.

We have really entered into a bad place have'nt we guys. I've had it in the back of my mind and it has deeply effected me but I am having to come to terms with two things, 1) that I know there are very deep connections between the major events of the last decade 2) that I have to sit down and try to understand what I should do with that knowledge.

[cipi604]

Alas, it didn't turn out that way. We had a supposedly impossible ramp up to almost 75 million bpd last summer. If it hadn't been for the economic crash, it would have continued.

+/- 5 years down the road it's not a lifetime. For example if you predict the weather, you say chances of rain x% , the basic rule is that you never go 100%, but the trend it's obvious. Bad weather arrives sooner rather than later.

[mos6507]

My doomometer is pegged right now

My (peakoil) doomometer was pegged when oil was at $147/bbl. Oil will have to go up over $100 before it pegs itself again. In the meantime, a future superspike, even in the near future, is still comfortably in the FUTURE. I will try to enjoy the present calm before the storm rather than squander it with anxiety.

[AirlinePilot]

ace wasnt off by that much. He has admitted several times that I recall that as the Wiki mega projects database got better his analysis has changed. Arguing over the last few mbpd is moot really. Anyone will be off by some amount, but the overall premise is far more plausible than your idea that we keep ramping up and up for decades. With everything thats happening you have to be in serious denial to believe that will transpire.

There is zero support for your premise that production would have continued its climb. We were on and had been on a plateau with only a few hundred K differences month to month. You need to move the scope of your chart out there Oily, you'd see that. But you only select the part which tends to visually support your argument due to the short duration of the datapoints. Typical.

As I've said, denial is a harsh mistress. We shall most definitely see.

[AirlinePilot]

These charts show the bigger picture....







That last one is important. look at the differences betwen the peak points. Its basically flat. Its within a few percent margin. This does not suggest growth, especially in light of large rises in price during that time. We should all hope and pray decline is only three percent or so. Frankly I doubt that but have no data to support another premise. 3-4% is bad enough. if you cant see that, then your completely in denial. We basically run out of time to do anything about it, because we havent done anything yet.

More folks like you and we just wont. Your counter productive to your own future and dont even understand it!

[peripato]

We had a supposedly impossible ramp up to almost 75 million bpd last summer.

Huh? Wasn't this just the market responding to $100+ oil prices? I mean at those prices surely even the roosters would start laying eggs. The sad thing is that despite all that "a laying", production was only able to be increased ~300,000 bs p/d over the previous conventional peak, so much for the rivers of new supply brought on by the invisible hand.

If it hadn't been for the economic crash, it would have continued.

Prove it...

[IslandCrow]

In the years I have been here it has constantly been said that we will only know the Peak "in our rear-view mirror", ie some time after the event. I would say that we are still to close to the peak production last year to say that production will not reach that level again. 2006 looked like the peak at the time. From the charts Pilot put up, it looks as if we are experiencing an 'undulating plateau' which started in 2005. In the plateau situation, (so far 5 years) the monthly peaks do not really matter too much, as the nature of the beast is that the actual peak could be almost anywhere on that plateau.

On the technical geological side there is enough out there that I believe it could be possible to have a new peak , BUT there are so many other factors in the equation, such as the economy, or how "rusty" the oil equipment is etc that a close call is almost impossible to make.

I can live with saying "2008 looks like it is a good candidate for the Peak Oli Year, but we need to wait some more years before declaring a winner in the contest"

[peripato]

In the years I have been here it has constantly been said that we will only know the Peak "in our rear-view mirror", ie some time after the event. I would say that we are still to close to the peak production last year to say that production will not reach that level again. 2006 looked like the peak at the time. From the charts Pilot put up, it looks as if we are experiencing an 'undulating plateau' which started in 2005. In the plateau situation, (so far 5 years) the monthly peaks do not really matter too much, as the nature of the beast is that the actual peak could be almost anywhere on that plateau.

On the technical geological side there is enough out there that I believe it could be possible to have a new peak , BUT there are so many other factors in the equation, such as the economy, or how "rusty" the oil equipment is etc that a close call is almost impossible to make.

I can live with saying "2008 looks like it is a good candidate for the Peak Oli Year, but we need to wait some more years before declaring a winner in the contest"

Well said, but you also need to factor in existing decline rates of 6% and the distinct possibility that the bear rally in oil, once it's run its course, will collapse the oil price again, (along with equities and other commodities), or force OPEC to cut even further in support of the price, canceling/postponing indefinitely important projects, mothballing equipment and laying-off critical staff. If demand continues to decline, (and if we get a depression why wouldn't that be the case?), then it might take many, many years, as it did with the 70's oil shocks, before we see production approaching pre-crash levels once more, and even if it did, those projects wouldn't be there. Of course depletion never sleeps, so by that time we would be far past the geological peak, meaning that 2008 will indeed have been "it".

Of course the borrowing and money printing going on worldwide might actually work to reignite some sort of recovery, but as said depletion of existing wells is still running at 6%, which is an awful lot of oil to bring online even during a boom, so likely high prices will probably collapse that recovery before it got too far along.

Back to 3rd base as they say...

[Daniel_Plainview]

Other than OilFinder, how are you all seeing this new data?

Unfortunately, given our current data, we cannot say with any statistical significance that oil production peaked in 2008. We're currently on top of an undulating plateau, and until there's a clear drop-off (or until Saudi Arabia concedes that its oil production has peaked), we will not be able to observe "peak" with complete confidence.

[mefistofeles]

Unfortunately, given our current data, we cannot say with any statistical significance that oil production peaked in 2008. We're currently on top of an undulating plateau, and until there's a clear drop-off (or until Saudi Arabia concedes that its oil production has peaked), we will not be able to observe "peak" with complete confidence.

All I can say is that we're in the Middle of a Depression and oil prices seem to be having a major rally. Its not unreasonable to expect $70,even $80 oil soon. Assuming that the United States can actually recover from the depression and China has a few more years of 6-8% growth we're really looking at oil prices in the hundreds of dollars per barrel these next few years.

Obama's CAFE improvements will pale in comparison to $10-$15/gallon gasoline. I'm lucky that I've spent a good chunk of change on bicycles recently.

[peripato]

Unfortunately, given our current data, we cannot say with any statistical significance that oil production peaked in 2008. We're currently on top of an undulating plateau, and until there's a clear drop-off (or until Saudi Arabia concedes that its oil production has peaked), we will not be able to observe "peak" with complete confidence.

All I can say is that we're in the Middle of a Depression and oil prices seem to be having a major rally. Its not unreasonable to expect $70,even $80 oil soon. Assuming that the United States can actually recover from the depression and China has a few more years of 6-8% growth we're really looking at oil prices in the hundreds of dollars per barrel these next few years.

Obama's CAFE improvements will pale in comparison to $10-$15/gallon gasoline. I'm lucky that I've spent a good chunk of change on bicycles recently.

I don't know if such high prices are possible - look what happened with oil at $147 - economic collapse. Even if you don't believe that sustained high oil prices were principally to blame for the collapse, it certainly was a causative factor. Prices that high again would likely just knock the stuffing out of any nascent recovery, sending the world economy into another recessionary dip, and the oil price with it.

[mefistofeles]

I don't know if such high prices are possible - look what happened with oil at $147 - economic collapse. Even if you don't believe that sustained high oil prices were principally to blame for the collapse, it certainly was a causative factor. Prices that high again would likely just knock the stuffing out of any nascent recovery, sending the world economy into another recessionary dip, and the oil price with it.

The US is already in a depression yet prices seem to be going quite strong. Aside from a total default on federal government debt every single key financial industry and a good chunk of the auto industry has already been destroyed so I can't see it getting too much worse. In fact that's what's so troubling with the banks tottering on ruin oil prices shouldn't be able to make such a strong comeback, unless we really are at or beyond peak oil.

Its also hard to see how a US Bond default would be deflationary, at least in dollar terms.

[peripato]

I don't know if such high prices are possible - look what happened with oil at $147 - economic collapse. Even if you don't believe that sustained high oil prices were principally to blame for the collapse, it certainly was a causative factor. Prices that high again would likely just knock the stuffing out of any nascent recovery, sending the world economy into another recessionary dip, and the oil price with it.

The US is already in a depression yet prices seem to be going quite strong. Aside from a total default on federal government debt every single key financial industry and a good chunk of the auto industry has already been destroyed so I can't see it getting too much worse. In fact that's what's so troubling with the banks tottering on ruin oil prices shouldn't be able to make such a strong comeback, unless we really are at or beyond peak oil.

Its also hard to see how a US Bond default would be deflationary, at least in dollar terms.

I guess that one of the main reasons that oil is making such a strong comeback is because almost everyone thinks/wishes/believes that their sector has seen "the bottom", since neo-classical economics says it must be so, and that the economy must rise from here on. More as likely once we have the next round of bank write-downs and or government defaults, the predicament in the financial sector will well and truly leak out into the rest of the economy throwing many more millions out of work, further dampening demand, collapsing the price of oil again, at least in the short-term. Over time I'd expect to see rising prices, perhaps very much higher prices, after all oil is a diminishing resource. But at such sustained high prices who would be able to afford it who is out of work and the rest of the economy is in the toilet.