Book: "Oil Panic and the Global Crisis" by Steven Gorelick

by **Graeme** » Mon 01 Nov 2010, 16:56:13

Oil: How much is there, how much more will we use and at what price?

Passions run high where oil is concerned. Witness the tumult over the BP drilling disaster in the Gulf of Mexico. But much of the public discussion about oil has been long on emotion and opinion while short on scientific fact, a state of affairs that Steven Gorelick, a professor of environmental Earth system science at Stanford, takes steps to rectify in his book, Oil Panic and the Global Crisis – Predictions and Myths, published earlier this year.

In Geofluids, a reviewer wrote, "Gorelick weaves an intriguing story from what might have been a dreadfully boring, yet impressive collection of data and observations."

For close to a century, there have been predictions that it is only a matter of time – perhaps just a few decades – before world oil reserves begin to run dry. The prospect seems worrisome, but with continuing advances in renewable energy, does it really matter? Stanford Report talked with Gorelick, a senior fellow at Stanford’s Woods Institute for the Environment, to get answers to that and other questions.

stanford

by **Pops** » Mon 01 Nov 2010, 17:21:33

The world may very well go through a peak in oil use, but a peak and decline is far more likely to reflect a decrease in oil demand rather than production choked by perilously low global availability of oil.

Man, ya just gotta shake your head dontcha.

Maybe he's right, maybe drought didn't do in the Anasazi maybe they just experienced a peak and decline in demand for water!
Same with the ever lovin Easter egg islanders, the demand for canoes and so trees just crashed!

<snort>

by **Carlhole** » Sun 07 Nov 2010, 05:53:09

PhysORG

Too often the debate over the world's use of oil has been marred by skewed information. In his recently published book, 'Oil Panic and the Global Crisis,' Stanford Professor Steven Gorelick lays out the facts about oil – its production and prospects – along with the consequences of both continued use and a shift to other energy.

by **Xenophobe** » Sun 07 Nov 2010, 10:43:57

Carlhole wrote:Let the trashing begin.

No trashing needed. Its a decent book. The guy covers the basis, seems to understand everything necessary, doesn't fall for Doomer Dogma.

He's a little rough on how he goes after the Hubbert curve, I might disagree with him there because he seems a little picky, but he's correct in his overall assumptions as to its value.

Should be on every Doomers nightstand to keep the evils of groupthink away.

by **Carlhole** » Sun 07 Nov 2010, 14:17:42

Xenophobe wrote:Its a decent book. The guy covers the basis, seems to understand everything necessary, doesn't fall for Doomer Dogma.
He's a little rough on how he goes after the Hubbert curve, I might disagree with him there because he seems a little picky, but he's correct in his overall assumptions as to its value.
Should be on every Doomers nightstand to keep the evils of groupthink away.

+1

by **Carlhole** » Sun 07 Nov 2010, 14:25:33

Read some of the reviews at Amazon

Gorelick notes that while the era of "easy" oil may well be over, how much oil is extracted from difficult sources remains to be seen. I quite agree with the author that the next or shall we say the current stage of extraction and prospection would ultimately be dictated by the price of oil. Many commodities traders believe a US$50 per barrel price or above would ensure extraction from difficult to reach places. However, that is not to say that a high price equates to the planet running out of oil according to the author.

Every key topic from the Malthusian doctrine to M.K. Hubert's approach, from Canadian Oil sands to drilling offshore and the relative cost of imported oil for consuming nations has been discussed in context of the resource depletion debate and in some detail. The text is backed-up by ample figures, graphics and forecasts from a variety of industry recognised sources, journals and organisations. Unlike a straight cut bland discourse, the narrative of this book is very engaging.

It may well be data intensive, but if the whole point of the book is substantiating an argument - then the data adds value and makes for an informed argument - for which author deserves full credit. In all my years as a journalist who has written on oil and follows the crude markets closely, I feel this book is the most engaging, detailed and well written one that I have come across in its genre. I am happy to recommend it to commodities professionals, economists, students and just about anyone interested in reading up on the oil depletion debate.

”It is a pleasure to read an informed, balanced, and lively account of the prospect of meeting the world's need for oil in coming years. A combination of sound economics, attention to history's lessons, and political leadership offer the way forward. Read this book and decide what you should do."
John Deutch, Institute Professor, Massachusetts Institute of Technology, former Director of Central Intelligence.

“A very readable statistical history of global oil depletion that frames and illuminates the century-old debate about “peak oil” or the “end of oil.” A suitable text for introductory resource economics or for the general reader with a love for facts and detail.”
Sylvio J Faim, Los Alamos National Laboratory

$43.96 ...Doh!

by **Carlhole** » Sun 07 Nov 2010, 15:30:50

by **Carlhole** » Sun 07 Nov 2010, 15:48:52

OnlineLibrary.com Book Review: Oil Panic and the Global Crisis: Predictions and Myths Gorelick, Steven M. , 2010

The book ‘Oil Panic and the Global Crisis: Predictions and Myths’ by Steven M. Gorelick is a refreshing and methodical exposé of the most common myths about oil that many of us hold as truths. Gorelick weaves an intriguing story from what might have been a dreadfully boring, yet impressive collection of data and observations. It was a pleasure to read and learn from this book, which I highly recommend to experts and non-experts alike, particularly our leaders in government. Every president of the USA since Eisenhower has promised to reduce America’s dependence on foreign oil, yet as each administration nears the end of term, we are more addicted than ever and we still lack a coherent national energy policy. We currently import about 70% of our oil at a cost of $700bn per year; four times the annual cost of the Iraq war. Perhaps this book is a small step in the right direction.

The book begins by asking the reader whether five deceptively simple statements are true or false. By the end of the book, I was convinced that two of my answers were wrong and another was at best a bit shaky. Gorelick never formally answers these questions; he leaves that work for the reader, but the book provides a wealth of information that instills doubt, shakes paradigms and forces some serious rethinking of one’s opinions.

The book is divided into five chapters, each with a summary and appended list of notes and supporting references. Chapter 1, ‘End of the Oil Era’ introduces the problem: if peak oil production marks the beginning of the end of the Oil Era, then as we reach that point it becomes ever more urgent that we re-structure our oil-based society. But when will peak oil production occur? The chapter gives a clear description of the three adjustable parameters that control the slope, peak height and time of the peak for the famous (or infamous, depending on your viewpoint) M. King Hubbert logistic curve that predicts the availability of petroleum resources versus time...

by **Carlhole** » Sun 07 Nov 2010, 17:35:19

In Chapter 4, ‘Counter-Arguments to Imminent Global Oil Depletion’ Gorelick shines as an independent thinker who does not simply accept what the ‘experts’ say. I thoroughly enjoyed his methodical disassembly of various myths: Hubbert’s predicted production rates were accurate; a decline in production indicates scarcity; resource assessments provide useful endowment estimates; there is little oil left to be found; the world cannot afford increases in oil use as developing nations demand more oil; there are no substitutes for oil.

Chapter 5 ‘Beyond Panic’ considers three key questions: (1) where is an efficiency gain possible, (2) will increases in efficiency reduce demand, and (3) what might ultimately substitute for oil? Rather than steal thunder from the book, I leave it to the reader to study Gorelick’s suggestions about how we should proceed to address the global oil crisis. As a teaser, Gorelick convincingly argues that our current paradigm to explain oil depletion is simply wrong. That paradigm is based on the assumptions that the global oil endowment is a known quantity and that consumers buy what is available because production rates control delivery to the market. The book unequivocally shows that these two assumptions are false. First, an accurate mass balance calculation is impossible for various reasons, such as technological advances and the politics of oil-producing countries, which can transform resources into reserves and vice versa. For example, resource assessments as conducted by the US Geological Survey consistently project larger and larger estimates of the worldwide oil endowment over time. The end of the Oil Era is a moving target that continues to march into the future. Forecasts of global oil depletion should not depend on these global resource estimates, nor should they rely so heavily on simplistic projections of recorded discovery and production data. Second, production does not limit oil consumption; rather consumer demand at a given price controls how much oil is produced. If there is a Hubbert-like peak in global oil production in the next few decades, it will probably reflect decreased oil demand rather than oil depletion.

Mmheh heh...

by **Keith_McClary** » Sun 07 Nov 2010, 19:23:24

Carlhole wrote:Let the trashing begin.

Anything there we haven't heard before?

Has anyone here been espousing the "Myths" that he debunks?

by **Xenophobe** » Sun 07 Nov 2010, 19:44:24

Keith_McClary wrote:
Carlhole wrote:Let the trashing begin.

Anything there we haven't heard before?

Has anyone here been espousing the "Myths" that he debunks?

Well, does anyone here believe in the predictive value of a bell shaped curve thingy?

by **Keith_McClary** » Mon 08 Nov 2010, 02:35:04

Xenophobe wrote:Well, does anyone here believe in the predictive value of a bell shaped curve thingy?

The bell shaped curve thingy is just a textbook example. The point is that any likely production curve will peak around half URR and changing the URR only moves the peak a few years. That's just basic math, not a matter of belief.

Is Gorelick a URR denialist?

by **Xenophobe** » Mon 08 Nov 2010, 20:57:04

Keith_McClary wrote:
Xenophobe wrote:Well, does anyone here believe in the predictive value of a bell shaped curve thingy?

The bell shaped curve thingy is just a textbook example.

I've never seen a bell shaped curve used in a geoscience textbook as a means of predicting extraction rates. Could you provide a reference please?

Keith_McClary wrote: The point is that any likely production curve will peak around half URR and changing the URR only moves the peak a few years. That's just basic math, not a matter of belief.

It isn't basic math. Hubbert (1956) didn't even provide an equation for it, just hand waved at grid paper. Later on Hubbert and others started curve fitting certain things, but that was out of convenience, not because of any relationship between "basic math" and a given rate of extraction. The science is pretty clear that this (at least in terms of URR) was, and is, a statistically ridiculous idea (Cavallo, 2004). The book is relatively clear on some of these topics, you should read it.

by **Keith_McClary** » Tue 09 Nov 2010, 02:31:29

Xenophobe wrote:It isn't basic math. Hubbert (1956) didn't even provide an equation for it, just hand waved at grid paper. Later on Hubbert and others started curve fitting certain things, but that was out of convenience, not because of any relationship between "basic math" and a given rate of extraction. The science is pretty clear that this (at least in terms of URR) was, and is, a statistically ridiculous idea (Cavallo, 2004). The book is relatively clear on some of these topics, you should read it.

Math does not necessarily mean explicit equations. You don't need to write explicit equations to show that a rock thrown up will fall down.

When I have discussions with true believers they can't explain their beliefs, they tell me to read their bible.

Can you describe any new ideas from this book that have not been discussed in these forums?

by **Carlhole** » Sat 13 Nov 2010, 12:50:34

Keith_McClary wrote:Can you describe any new ideas from this book that have not been discussed in these forums?

I haven't read this book yet (don't have an extra $50 right now). But it seems right in line with the EIA's recent statement that conventional oil probably peaked in 2006 and that oil & gas will nevertheless remain at predictable, plentiful levels to 2035 or so.

Readers appreciate this book because it elucidates the peak oil debate by presenting both sides of the argument through facts and data drawn from the most reliable sources -- and then placing these arguments side-by-side for comparison. The author merely presents arguments and supporting information; the reader is allowed to make up his/her mind about our probable oil future.

I suppose a doomer could have a beef with the way the doom argument is presented, but we haven't read the book to see how good a job the author actually did.

Stephen Gorelick is Professor of Earth Sciences at Stanford who specializes in Hydrology. He is also an environmentalist. I gather he is a talented researcher who decided to dig into the controversial subject of Peak Oil while on sabbatical. I might buy this book because I'm already well-acquainted with Deffeyes, Heinberg, Kunstler, and the crews at ASPO and Post-Carbon. I've also read Michael Lynch and reports from CERA, etc. But no one has presented the overall debate in this format with this level of detail before that I know of.

by **Xenophobe** » Sun 14 Nov 2010, 11:33:02

Carlhole wrote:I suppose a doomer could have a beef with the way the doom argument is presented, but we haven't read the book to see how good a job the author actually did.

I finished it a month or two ago. Its sitting on my desk at the office. He did do a good job. Excellent references. Fair treatment of both sides. Certainly didn't back down from giving everyone a fair airing of their ideas.

The fact of the matter is that peaker ideas simply don't hold up to any level of critical examination, and it shows when someone with scientific expertise tackles the topic. Scientists don't fall for the red herrings, distractions, arm waving and yelling that peakers substitute in lieu of critical analysis.

by **Carlhole** » Sun 14 Nov 2010, 13:12:18

Xenophobe wrote:
Carlhole wrote:I suppose a doomer could have a beef with the way the doom argument is presented, but we haven't read the book to see how good a job the author actually did.

I finished it a month or two ago. Its sitting on my desk at the office. He did do a good job. Excellent references. Fair treatment of both sides. Certainly didn't back down from giving everyone a fair airing of their ideas.

The fact of the matter is that peaker ideas simply don't hold up to any level of critical examination, and it shows when someone with scientific expertise tackles the topic. Scientists don't fall for the red herrings, distractions, arm waving and yelling that peakers substitute in lieu of critical analysis.

Oh well, there goes another $50 off to Amazon. Sure is expensive being smarter than everyone else.

by **Xenophobe** » Sun 14 Nov 2010, 13:25:23

Carlhole wrote:Oh well, there goes another $50 off to Amazon.com. Sure is expensive being smarter than everyone else.

I wonder how much cash these guys make off the books. Or if its for the academic prestige, you know, add it to their resume type stuff. The most valuable part of his book were the references in each chapter, I ran down more than a few of those. You can tell the difference between peaker pubs and science based pubs just based on those many times. Certainly you didn't see him referencing social commentators or ex-cops when backing up his statements.