The Beginning of the End of Oil

It used to be that those who foretold of a day when oil wells
would start running dry were scoffed at as ‘cranks and conspiracy
theorists.’ But the idea of ‘peak oil’ isn’t confined to the dark
corners of the Internet’s catastrophists anymore, Kevin Drum writes
in
Washington Monthly. Rather, the harbingers of peak oil
have ‘practically become rock stars.’

A new book by one-time Bush energy advisor Matthew Simmons lays
out the case for a shattered faith in the idea that oil reserves —
namely Saudi Arabia’s — and ever-improving technologies will keep
the black gold flowing at a rate that will meet increasing demand.
It’s a position gaining traction as a ‘hot topic,’ Drum writes.

But it’s not just a couple of naysayers sounding the alarm. In a
recent outlook report, petroleum giant ExxonMobil said it expected
non-OPEC oil production to soon level off, after a peak in five
years. As energy consultant

Alfred J. Cavallo points out in the Bulletin of the Atomic
Scientists
, it’s the first time an oil company has deigned
to speak of peak oil.

ExxonMobil has two ideas for meeting increased demand. The first
is to become more fuel efficient. ‘That alone should convey the
seriousness of this report: When have you ever heard a petroleum
company make a plea for vehicles that use less gas?’ Cavallo asks.
The other is increased OPEC production, which he calls an ‘ominous’
assessment, given the countries’ ‘vested interest in obtaining the
best possible price for their non-renewable resources.’

Cavallo appears to share the widely-held belief that the
resources are there, the OPEC countries just won’t want to tap them
at the rates the world wants. That’s a sketchy proposition, Simmons
warns in Twilight in the Desert.

Using limited data — a commodity in short supply — Simmons
argues that the country’s oft-pointed-to savior supply is a sham.
While Simmons acknowledges he’s looking through a ‘very small
keyhole’ of information, he’s doing the best with what he and the
rest of the world’s got, Drum writes. What’s needed is more
transparency, Simmons and others argue — a sentiment echoed by the
International Energy Agency, the International Monetary Fund, and
G7 members, which this year called on OPEC and other nations to
‘open their fields to audit,’
The Guardian reports.

What does this all mean? ‘[T]hat the petroleum industry is
approaching a turning point,’ Cavallo writes. And the American
public and government would be wise to follow suit. Drum suggests a
four-pronged approach of ‘increased production, development of
alternative fuels, conservation, and increased efficiency.’ While
opinion ranges on when peak will be reached, most experts agree
such solutions will take a good amount of lead time. ‘[W]e’d be
well advised to get started now,’ Drum says.

Go there >>

Crude Awakening

Go there too >>

Oil: Caveat Empty

Go there too >>

When the Wells Run Dry

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