[Graeme]

Maxwell Forecasts Peak Oil in Seven Years

Respected oil analyst and oil industry veteran Charles Maxwell (nicknamed the “Dean of Oil Analysts”) has forecast peak oil by 2017 or 2018:

His prediction is not so remarkable, as is where he made his prediction. The prediction was in Forbes, which has often scoffed at the notion of a near-term peak. Some of Maxwell’s comments:

A bind is clearly coming. We think that the peak in production will actually occur in the period 2015 to 2020. And if I had to pick a particular year, I might use 2017 or 2018. That would suggest that around 2015, we will hit a near-plateau of production around the world, and we will hold it for maybe four or five years. On the other side of that plateau, production will begin slowly moving down. By 2020, we should be headed in a downward direction for oil output in the world each year instead of an upward direction, as we are today.

consumerenergyreport

forbes

[efarmer]

Thanks Graeme, another gem from your long history of delivering things.

The sign that we are there will be simple, governments globally will impose price controls on
petroleum and take market speculation out of the equation to maintain order and the ability
to mitigate.

[Pops]

Thanks Graeme.

Here is a related post from Rapiers buddy Staniford a couple of good graphs on production too.

[Expatriot]

We have been on a plateau for 5 years and this guy thinks we've got another 7 to go? Interesting.

[Revi]

Good luck with peak oil in 2017. We probably peaked in 2008.

[ian807]

Hope he's right. We'll only know after the fact, of course. We'll know when the crunch has hit when oil prices start fluctuating wildly and don't stop. It mean oil price feedback has entered the equation and the ability of our civilization to profitably extract oil and use it as a significant power source (except in a few localized areas) won't last too long after that.

[lper100km]

It’s interesting that he thinks production can stabilize for so long. He’s obviously thinking peak production, which is but one side of the equation. The other peak – halfway point of recoverable reserves – imo has already been surpassed which means we are on the down leg. Peak reserves and peak production don’t have to coincide. Low economic activity can mask production limitations for a while. That’s what I think he is alluding to. Even in low production times, eventually the demand curve and availability limit collide. Perhaps it will take seven years. It’s a believable scenario.

[Pops]

I think it's funny that he uses the same small-brain reasoning I do to explain that oil is near peak - "If ya can't find it, ya can't pump it."

The peak of production usually comes sometime between 30 and 50 years after the peak of finding oil. "The peak of discovery," as they call it. For instance, in the North Sea, the peak of discovery was in the late 1960s, and the peak of production was in the late 1990s. So it was around 30 years between the peak of finding oil and the peak production of that oil...

I believe that the peak of discovery fell in the five-year interval between 1965 and 1970. So if you took it at, say, 1968, and then you added 50 years, you would get to 2018.

Sounds like what I wrote for our primer 6 years ago:

Although derided by most in the industry he [Hubbert] 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.