Insights Regarding Future World Oil Production: ASPO Denver Presentations

This post is an attempt to summarize the main points on oil and the economy from the conference presentations–concluding that there are three distinct future trajectories as we go forward.

At the Denver conference, world oil production was discussed from both the supply side (what flow rate can be reached) and the demand side (how much can the economy afford). It is really the combination of the two that is important–so I bring together both in this post.
Ray Leonard showed that production in the Rest of the World peaked in 2002 and by 2008 declined by 7%. With OPEC and Russia unable to increase production significantly due to politics and economics, we are nearing World Peak Oil Production. “Production peak of ultra deep water fields will allow ‘peak’ to be a ‘plateau’ in the coming decade, followed by a sharp fall” according to Leonard. Unconventional production is not set to change this situation, as his expectation is that the contribution of this category of oil will be less than 3 million barrels per day in the short to middle term.

The specific path of future oil production was projected by Chris Skrebowksi using the oil megaprojects approach, wherein all the large fields expected to come on-stream in the next seven years are tabulated and compared with decline rates in current fields. In this approach, only the supply side is taken into account and the demand side is ignored. From that perspective according to Chris Skrebowksi the current plateau will continue until around 2014 when the decline sets in, shown in figure 2 below.

The Oil Drum: Europe