The BusinessWeek story cited below, along with King Abdullah’s April announcement that they will not be opening new fields, provides evidence that we are near — or perhaps even at — Peak Oil.
- It may be political peaking;: perhaps the Saudi’s could invest to increase production, but choose not to (an obviously sensible decision).
- It may be geological peaking, if the Saudi’s are unable to increase production. But whether geological or political peaking, the long-discussed event may be starting now.
Since America prefers to base its energy policy on inspired guesses, nobody has modeled the possible outcomes. A few million dollars for a multi-disciplinary team to gather and analyze data would have better prepared us for this moment.
So we have no plans (hope is not a plan). We have no foundation of comprehensive data and research on which to make plans. We can only speculate at what happens next. If we are near or at peak oil, the next decade or so probably will not be pretty (that means painful, but not the end of civilization). We can take solace in the knowledge that through our fecklessness we have earned what we are about to receive.
Sooner or later, everyone sits down to a banquet of consequences.
Robert Louis Stevenson, perhaps apocryphal
“Saudi Oil: A Crude Awakening on Supply?“, BusinessWeek, 10 July 2008 — “The Saudis say they can ramp up production to 12.5 million barrels a day. But a field-by-field breakdown obtained by Business Week shows that’s not likely “ This may be great investigative work; it may be a semi-official leak. Excerpt:
However, it appears that for at least the next five years, and possibly longer, the Saudis are likely to produce less crude than promised, according to fresh data on the kingdom’s oil fields obtained July 9 by BusinessWeek. Saudi officials have said they would increase production capacity to 12.5 million barrels a day next year, from the current 10 million barrels a day, and could even ramp up to as much as 15 million barrels a day if the market demanded it.
… But the detailed document, obtained from a person with access to Saudi oil officials, suggests that Saudi Aramco will be limited to sustained production of just 12 million barrels a day in 2010, and will be able to maintain that volume only for short, temporary periods such as emergencies. Then it will scale back to a sustainable production level of about 10.4 million barrels a day, according to the data.
BusinessWeek obtained a field-by-field breakdown of estimated Saudi oil production from 2009 through 2013. It was provided by an oil industry executive who said he had confirmed it with a ranking Saudi energy official who has access to the field data. The executive, who has proven reliable over several years of reporting interaction, provided the data on condition of anonymity to protect his access to the kingdom and the identity of the inside contact who confirmed the information.
Please share your comments by posting below (brief and relevant, please), or email me at fabmaximus at hotmail dot com (note the spam-protected spelling).
For more information about Peak Oil
Here are some of my posts about Peak Oil.
- When will global oil production peak? Here is the answer! (1 November 2008)
- Links to articles and presentations of some A-team energy experts (11 November 2008)
- The most dangerous form of Peak Oil (8 April 2008)
- The three forms of Peak Oil (let’s hope for the benign form) (23 April 2008)
- The world changed last week, with no headlines to mark the news (25 April 2008)
- Peak Oil Doomsters debunked, end of civilization called off (8 May 2008)
- When the King of Saudi Arabia talks about oil, we should listen (2 July 2008)
Here is an archive of all my articles about Peak Oil.
Here are other resources to learn about Peak Oil.
One day people in the Western world will wonder why we let ourself be dependent on Saudi oil for so long. This is a regime that is comparable to the Taleban and as closed as the old Soviet Union. If BusinessWeek is right we are really screwed. Actually it began to wonder me several years ago: When I began to read about the Middle East around 1990 (the Gulf Crisis) I noticed that Saudi Arabia was credited for having 20-25 percent of the world’s oil. Somehow that number hasn’t really changed over all the years despite a world consuming more and more oil. And apparently that number – until recently – was still not expected to change despite a dramatic rise in world demand. Matthew Simmons wrote an insightful book about the subject called “Twilight in the Desert” debunking the myth of Saudi Oil several years ago.
I want to add that it is not entirely correct that there are no plans. There is, but how good or bad they are I can’t tell. They are certainly only usable for a short term. The United States has the Strategic Petroleum Reserve and Japan has an even large reserves. Even Denmark has a reserve enough for 81 days of full consumption or 900 years through rationing. So in case of a crisis in the Gulf we would manage, however only with a much smaller economy. What worries me is that several countries are dependent on each other and that 95 percent of all transportation in the United States is by using cars. It won’t only be a question of people might not be able to drive to work, but also that groceries stores might not receive supplies of food. Only a few years ago a lot of goods in Denmark were transported using trains, but just a few years ago the numbers of freight trains dropped dramatically because trucks were cheaper and faster. So right now we don’t have that alternative anymore.
Of course a reserve of oil is only a short time solution. Any other solution would demand a move away from oil and over to renewables, nuclear power, fusion energy, more energy efficient houses and cars etc. Until recently the politicians only wanted to do that because of the fear of climate change. Now they will have to take the same steps because of peak oil and much faster than anticipated. The is no magical silver bullet, so everything has to be tried.
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Fabius Maximus replies: I do not understand your basis for saying that we have plans. Using the SPR is not a rational response to Peak Oil, any more than eating ones’ seed corn is a plan for providing food. The SPR is an emergency supply in the case of temporary interruptions. Peak oil makes these more likely, not less. The “any other solution” are things that requires years or decades of planning and work — hardly relevent to the onset of peak oil today.
You state that “We have no foundation of comprehensive data and research on which to make plans.” but we actually have more information than most people recognize. It’s just that it’s difficult for regular folks to access and work with the data that we do have.
I am trying to remedy that particular problem with the “Energy Export Databrowser” at mazamascience.com/OilExport/ This on-line tool allows folks to generate charts of production-consumption-import-export timelines from the 2008 BP Statistical Review. There are no projections into the future in the databrowser, only a look at the past. But this view shows us unmistakable trends that we must pay attention to. It is my hope that providing a simple way to work with this important dataset will allow people to educate themselves about what has happened, what is happening and what is likely to happen.
The data really do speak for themselves if given a chance.
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Fabius Maximus replies: We might have ‘more information than most people recognize” (how do we test this theory?), but I am well aware of the existing datasets. These are grossly inadequate for detailed modeling of supply and consumption patterns. Which is why even our top experts can do little more than make inspired guesses.
Data seldom speaks for itself. It requires analysis. We sophisticated tools, but they require input and much additional work.
Like I wrote reserves are only a short-term solution. It is still better than nothing. Today we live in a world that is massively dependent on oil and gas. While it might not help us in the long term reserves – if handled properly – could help us avoid large-scale disruption of our societies from day 1 of Peak Oil. In the longer term they won’t help us of course, but in the run we are all dead like you once wrote. We need a strategy for coping with peak oil, but any strategy must begin with the fact that right now we are extremly dependent on oil and we can’t change that for some time. Therefore any solution must be built on the assumption that society must be kept together and working despite the onset of oil shortages. Reserves can help us. They can be used to bring supplies to the shops, drive ambulances and police cars, provide fuel for vital machines (especially farming machines) and give us electricity. They can keep society running and working while we begin the difficult transition to a society less dependent on oil. We have to try everything to prevent this from turning into a massive disaster, but it will only be one of many solutions and it will only we useful for a short time. I certainly agree that reserves are not the magical silver bullet for solving the problem of Peak Oil.
Yes, Peak Oil has arrived.
According to energy investment banker Matthew Simmons, global oil production is now declining, from 85 million barrels per day to 60 million barrels per day by 2015.
During this time the demand for oil will increase 14%. This is like a 45% drop in 7 years. No one can reverse this trend, nor can we conserve our way out of this catastrophe. Because the demand for oil is so high, it will always be higher than production; thus the depletion rate will continue until all recoverable oil is extracted.
Alternatives will not even begin to fill the gap. And most alternatives yield electric power, but we need liquid fuels for tractors/combines, 18 wheel trucks, trains, and mining equipment.
We are facing the collapse of the highways that depend on diesel trucks for maintenance of bridges, cleaning culverts to avoid road washouts, snow plowing, roadbed and surface repair. When the highways fail, so will the power grid, as highways carry the parts, transformers, steel for pylons, and high tension cables, all from far away. With the highways out, there will be no food coming in from “outside,” and without the power grid virtually nothing works, including home heating, pumping of gasoline and diesel, airports, communications, and automated systems.
This is documented in a free 48 page report that can be downloaded, website posted, distributed, and emailed. This report is found by Internet search: clifford wirth peak oil.
Anyone interested in relocating to a nice, pretty, sustainable area?
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Fabius Maximus replies: Given the history of predictions about oil production, I think we can regard this frorecasts with some skepticism. As for the rest, I discuss these apects of the problem in “Peak Oil Doomsters debunked, end of civilization called off“.
As T.E. Lawrence said, “Nothing is written.”
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Great piece fm on The Oil Drum.
This old news….the document below was produced almost 20 years ago and little has changed since:
“Brittle Power: Energy Strategy for National Security“, Amory B. Lovins and L. Hunter Lovins (1982). Per Wikipedia:
“…prepared originally as a Pentagon study, and re-released in 2001 following the September 11 attacks. The book argues that domestic energy infrastructure is very vulnerable to disruption, by accident or malice, often even more so than imported oil. A resilient energy system is feasible, costs less, works better, is favoured in the market, but is rejected by U.S. policy.”
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Fabius Maximus replies: What has changed is that the need was theoretical and distant 26 years ago. It is fact and immediate today.
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