Yesterday the price of oil exceeded $113 per barrel. Today the Financial Times included an article to the effect that Russia had reached its peak in output last year and would likely not exceed that production level in the foreseeable future. Another production peak heard from. According to the article, Leonid Fedun, of Lukoil, estimated that a trillion dollars would be needed in new exploration and development investments to sustain last year’s level of production for the next 20 years. I suspect Mr. Fedun is an optimist.
Is this another symptom of the decline in global oil production or is it just an anomaly of the Russian situation? Continue reading Another shoe drops→
The world is finally beginning to perceive that oil might just be more dear in the future. Today comes another news note pointing to the concept that we may have reached the peak of global oil production. The news is that discovery of new oil reserves in the Gulf of Mexico has hit the lowest level in a decade. Specifically, according to the energy consultancy Wood MacKenzie as quoted in today’s Financial Times and elsewhere, the 2007 new reserves were less than half of those found in 2006. Continue reading Peaking out?→
Past 100 dollars US per barrel of oil, that is. I made the forecast to some friends early this year that we would see $100 oil by the end of this year. It seems that that day has arrived—or shortly will arrive. Apparently the message of ever higher-priced oil is finally beginning to penetrate the global mind. Not a minute too soon.
As one indicator, the Tokyo auto show, just ended, had a number of green cars in it. These included a 400kg plug-in hybrid Toyota 1/X and an innovative all-electric Nissan Pivo with a 360-degree revolving cabin and wheels that can turn 90 degrees to slide directly into parking places. Of course, you can’t actually buy one of these yet. Maybe in a few years.
So what can you do now while gas prices continue their inexorable climb and the interest portion of your adjustable-rate mortgage follows suit? Continue reading Blowing past 100→
For those of you who have been wondering, the military action in Iraq is really about oil, not Weapons of Mass Destruction. It must be true because Alan Greenspan wrote it in his recently released book, The Age of Turbulence: Adventures in a New World. Ordinarily I try to refrain from posting statements related to politics in this blog, but this one was just too much for someone interested in long term sustainability. In this case, the issue definitely emphasizes the need for decreased worldwide dependence on oil.
Not only that, but the world could do with a lot less of the hypocrisy prevalent in political (and other) circles. As an example of American hypocrisy, George Lakoff editorializes in Truthout:
Recently, Eric Britton of ecoplan (and the dynamo behind the Kyoto World Cities 20/20 Challenge) asked some of us for comments regarding possible long-term energy policy issues and options. His specific request was:
Given what you know about the long term needs, trends and prospects, (and please do specify a bit, is that out to 2020, 2030, 2050 and/or beyond), would you help us to understand what you think governments and policy makers at various levels, the key industrial and financial groups, and others should be concentrating their attention on in the next 3-4 years, say from 2007 to 2010?
In case you believe that those who are proclaiming the end of oil are a bunch of Chicken Littles, consider the following.
Last week Shell Oil announced that it could not find enough new reserves to keep up with the rate at which it was pumping out existing fields. That is, the amount of oil in the ground is declining — at least as far as Shell can exploit it.
According to the 30 April 2006 edition of Energy Alert “Even though Exxon is growing production strongly, it has been earning less from the incremental barrel. In other words, production is increasing for Exxon but it’s costing more per barrel to produce, for a number of reasons.
Demand for oil by India and China continues to rise, bumping up against the also escalating needs of the U.S.
These are just three of the indicators buried in the news that support the idea that gas prices may fluctuate day to day, largely for political reasons, but the long term and inevitable trend is up.
At the risk of sounding unpatriotic or worse, I have to say that my reaction to escalating gas prices is: good! We have been underpaying for our energy for decades. The result is that, like all things that are free, or at least cheap, we are profligate spenders thereof. Now that the price of gas has begun to get our attention we may, just may, begin to think about ways to reduce our pain.
Such as by teleworking more, planning car trips more carefully, dumping the gas guzzler for a vehicle that is more fuel efficient, encouraging R&D on alternative fuels and propulsion systems.
But is that what’s happening? Not in Congress. Most of the activity by both parties seems to be directed toward bringing gas prices down again. Continue reading Fuelishness→
World oil production will hit its peak around 2011 unless some totally unanticipated discoveries occur between now and then. So far, none of the discoveries recently announced in the press have been unanticipated. Furthermore, new discoveries tend to be in hard-to-reach places, simply because all the easy-to-reach spots have been exploited long ago. Tertiary exploitation of these resources has begun and will eke out more oil, but at a rising cost of recovery.
