Peak Oil at 2014?

BoatMad

Actually many analysts suggest we are nearing " peak demand " in the western world and that oil will remain cheap as less of it will be required and more is being found every day.

As things stand we're consuming it much faster than we're "discovering" it. The reason I put discovering in quotes is because the reserves are dependent on the price of oil.

In other words when oil is expensive there are more oil resources classified as reserves due to the fact that they are financially viable to extract.

When oil is going cheap, the reserves shrink.

This chart shows just how quickly we're "taking up the slack" before we catch up with the oil exploration teams.



https://en.wikipedia.org/wiki/Peak_oil#Discoveries

Sam Kade

Back in the 70's we were told oil was running out, there's lots of it burnt since.

Sam Kade

Sam Kade wrote: »

Back in the 70's we were told oil was running out, there's lots of it burnt since.

well, we DID run out of the $2 a barrel oil that was being produced then, people were reluctant to pay more until it started to become scarce. Then massive investment in places like the North sea & Alaska, plus the switch from oil to gas in power stations and other changes in consumption and, problem sorted for a few more decades (up to now in fact).

_Tombstone_

Ye We'll always be filled full of sh1te to suit the lads selling the stuff. Pointless talking about it cuz ya don't know what you're talking about.

Capt'n Midnight

Sam Kade wrote: »

Back in the 70's we were told oil was running out, there's lots of it burnt since.

cheap oil ran out.

easily extractable oil ran out, much of today's fields rely depend on technology that wasn't available in the past

oil that didn't require a lot of energy to extract ran out, we are now using sources where a quarter of the energy is used up

we've been able to recover a greater percentage of the oil from existing wells
and there's a lot of unconventional oil like tar sands and of course the surge in gas has taken a lot of pressure off oil

Back in the 1970's we ran power stations on oil. Those days are probably gone forever.

Also in 1970 we only had half the population and most of them didn't have the same demand that people do today

BoatMad

BoatMad wrote: »

Actually many analysts suggest we are nearing " peak demand " in the western world and that oil will remain cheap as less of it will be required and more is being found every day.

Peak demand is another way of saying that the limits to growth have been reached as the economy can't grow fast enough to consume the extra oil that the massive investment splurge a decade ago has now brought to the market.

As things are the "perpetual growth" economy is looking to be in poor shape right now, so much so that Brent oil dropped in price by 6% today!

Markcheese

It could be argued that we're still on the same peak oil event from the 70's- its more of a wave than a peak ... cheap oil (if it lasts a year or two) will kill off renewable and energy saving projects-
Long term cheap energy prices will stimulate energy use - economies that had tanked on high prices will rise again ,as will demand and price - when the price gets high enough it'll stimualte energy saving and renewables and new oil tech as the price throttles economies and down we go again...
20 30 40 year economic cycles ...gets tricky to factor in economic development and political changes like russia and china though...

Capt'n Midnight

Markcheese wrote: »

cheap oil (if it lasts a year or two) will kill off renewable and energy saving projects-

This is why I hate nuclear. It costs so much that there's nothing left to invest in research into new renewables.

Long term cheap energy prices will stimulate energy use

cba looking for the citation now, but roughly 1-2% of global GDP is spent on lighting. And that stat goes back hundreds of years including oil lamps to now.

Capt'n Midnight

Deleted User wrote: »

As things are the "perpetual growth" economy is looking to be in poor shape right now, so much so that Brent oil dropped in price by 6% today!

Well there are now twice as many people as back in teh 1970's and they expect a better lifestyle than back then too. In 1970 there were no mobile phones. Today almost all adults worldwide have them.

Relating to energy efficiency, today's TVs use less power. But we offset that by buying bigger ones. I can remember 12" black and white's.

There are twice as many people, but there are now at least four times as many using oil powered equipment that in the 1970s. Back then most third world countries were still farmed using draught animals, even some parts of the USSR and eastern Bloc still farmed the old fashioned way. Mechanisation of agriculture & transport is now almost global, yet in western countries the per capita consumption of oil has dropped, mainly due to the improved efficiencies and the abandonment of excessively fuel hungry modes of transport. Things like supersonic passenger planes & flying car ferries.

Impetus

It is a bit like stock exchanges. Before investors bought and held investments. Today people with iPads and similar are trading online in the expectation of making a quick buck to pay for lunch money. As a result, exchanges are handling a massive amount of transactions and volatility is increased. Add to that program trading, where servers are placed next to stock exchange servers, to ‘steal’ a cent here and there from zillions of transactions. Another form of insider dealing.

In the oil industry, hydraulic fracturing, (aka misspelt fracking) … is sucking more oil out of the ground faster than it can be used or stored at sea on oil tankers that can rent for $150’000/day. This has driven the price down, and consumption has not increased. I suspect because if fuel gets cheaper, people don’t go driving around town in circles for the fun of it. However, fracturing is a short-term extraction technology compared with a large oil well. It seeks to accelerate output from marginal hard to reach fields. Leading to a much shorter shelf life. So when most of the suitable fracturing wells are sucked dry, we are back to the old reliable Saudi type wells. Those that are left, and pushed to the limit. At that point there will be a sudden spike in oil prices. Much depends on developments in the area of electrification of transport and renewable energy adoption and storage efficiency ratios.

One of the largest risks is political stability in oil producing areas. Saudi Arabia is talking about selling the crown jewels – the state oil company Aramco on the stock market today. This is the biggest company in the world bar none. Apple and Exxon are corner shops in comparison (slight exaggeration). Traditionally Saudi & co kept unemployed, largely unemployable young people content with large state aid/social protection payments. The fall in the price of oil has reduced Saudi revenues substantially. There are also questions about their reserves (in terms of producing a prospectus for Aramco’s IPO.)

So it depends on how one defines peak oil. The world is at a peak oil in terms of inventories and production levels. However, demand is tailing off. For example, UBS reported last week that electricity consumption is growing in China as used by service industries and light industry. On the other hand, electricity consumption by heavy industry is declining. I suspect heavy industry use of oil is declining too. The Chinese government are working hard to clean up big city air. Plants that were acceptable 10 years ago in pollution terms, are now being allowed to close, if they don't clean up their act. This involves changes in types of energy used.

Developing economies are moving rapidly from oil and coal to renewables and electric modes of transport.

We live in interesting times

https://cdn3.vox-cdn.com/thumbor/e-4JF4dfXRLDkmsyyyfZTvxNkrU=/cdn0.vox-cdn.com/uploads/chorus_asset/file/2559242/supply_vs_demand.0.png

Screenshot posted on the peakoilbarrel site,
Original interactive chart here http://www.economist.com/blogs/graphicdetail/2016/01/daily-chart-6
Clearly a lot of oil produced at a loss.

Impetus

Deleted User wrote: »

Screenshot posted on the peakoilbarrel site,
Original interactive chart here http://www.economist.com/blogs/graphicdetail/2016/01/daily-chart-6
Clearly a lot of oil produced at a loss.

It seems to me that the real, sustainability question, in terms of oil output, is how much per bbl does an oil state need to run its government? eg Norway has an over-taxed population, whose state can largely function with big fluctuations in oil prices. Saudi Arabia has very little industry or technology to offer the world, and low taxes - its entire government, and therefore political stability, rests on selling oil (which is a finite resource anyway) at a price that will pay for the cost of government, at a minimum. Otherwise the country breaks down, as has been/is the case with Libya. Libya needs an oil price of about $200 per bbl to pay for government - thanks to the action of certain Western governments that upset the local balance of power. Same in Iraq and they are not alone.

Western state terrorism against certain Arab oil producers has created ISIS. In the same way as various types of 'IRA' were created in Irish history. If GB minded its own business with IRL, as they did with Denmark and many other small countries, there would never had been an IRA.

Sustainability of energy supply not only requires sustainable technologies. It also needs sustainable government. The most sustainable governments are found where the decision making process is devolved to the lowest level possible - the prime example being Switzerland - rich with almost zero natural resources, and no oil.

Yep! there's a lot more to oil production than just having fuel for your car, Saudi Arabia is certainly between a rock and a hard place when it comes to trying to play the old "swing producer" game. If they cut production now, they'll just lose market share to the US and other producers who are desperately hoping they will.

I still wonder whether the US & SA are together on this and trying to weaken the new Russian empire (just like the late 1980s when the low oil price finished off the Soviet Union) or is SA in a head to head with the US as it was the US that brought a lot of "spare" oil to the table.

Looks like the plan to raise oil prices is still on target.

http://oilprice.com/Energy/Energy-General/Russia-Claims-Global-Oil-Output-Down-By-14M-Bpd.html
Russian Energy Minister Alexander Novak has announced that global oil output was cut by 1.4 million barrels per day last month, in the aftermath of the deal between OPEC and non-OPEC countries to rebalance the market.

Novak made his announcement during a meeting with Russian President Vladimir Putin, referring to preliminary data without explaining the sources of the data.

If Novak’s figures are correct, it would mean that OPEC and non-OPEC countries are close to meeting their goal of cutting a combined 1.8 million barrels per day by the first half of this year.
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At a compliance meeting in Vienna earlier in January, Novak said that Russia had reduced its oil production by some 100,000 barrels a day.

Waestrel

Deleted User wrote: »

Looks like the plan to raise oil prices is still on target.

Will this not just give the frackers a huge profit margin?

Capt'n Midnight

Waestrel wrote: »

Will this not just give the frackers a huge profit margin?

Yes.

LNG is transportable so it's a global trade.


It might even make coal economic again, something Trump would milk for PR.



China has cancelled 103 coal plants.
https://www.nytimes.com/2017/01/18/world/asia/china-coal-power-plants-pollution.html?_r=0
Also like Germany I suspect any new plants that go ahead will be replacing older less efficient ones resulting is lower emissions per watt produced.

celtic_oz

https://www.youtube.com/watch?v=OceeL7i1Qec