Empty Holes and Black Swans – Simmons interview

It may be blasphemous to ponder in a region that produces a good deal of the world’s hydrocarbon-based energy, but what if Peak Oil has already occurred?

“My opinion is that it’s increasingly likely that we actually set an all-time record in May 2005 of 74,252,000 barrels per day,” states Matt Simmons, founder and chairman of the world’s largest energy investment banking company, Simmons & Co. International.
“And for the first three months of 2007,” Simmons continues, “we were almost a million barrels per day behind that, and we’re dropping fast. If that record still holds a year from now, I’ll bet someone ten-to-one that we set peak oil in May 2005 and it’s now past tense.”

Not one to shy away from a bet, Bud Conrad, chief economist at Casey Energy Speculator and fellow Peak Oil enthusiast, plotted the following slightly more inclusive chart to give us an idea of where we stand today.

As the graph clearly illustrates, world production has been on a rather unimpressive plateau for the past couple of years. Part of this stagnation in global output growth stems from the coughing, spluttering “chokepoints” that we read about in the news every other day.

Just this past weekend we saw crude shoot up about four bucks on the back of threats made by Venezuela’s head honcho, Hugo Chavez, that he may sever export lines to the thirsty U.S. Then there was a decline in production in Nigeria…troubles in the North Sea…ongoing issues in Iran…the “problem with Putin”…the list goes on.

The thumbscrews are tightening for net oil importers.

Howe Street: Rude Awakening, Simmons interview (Part I) included.