[AirlinePilot]

Im in complete agreement with pops on this. I understand and grasp.....hell I even agree! on POD....but stepping back and viewing the greater picture is often very hard for most folks to do. For a while we will struggle along the plateau and it will look "normal" but once that plateau becomes decline, and it is ACKNOWLEDGED, ...I believe the real fun will begin.

While Im in pops camp and think we are living the peak right now......the POD explains the last gasps of a desperate attempt at BAU. How long that can go on is anyone's guess.

[Plantagenet]

$this->bbcode_second_pass_quote('Pops', '
')
My point is that it is becoming more and more likely the plateau is the peak and what comes next isn't more plateau, it's decline. And as bad as the effects may be now, we ain't seen nothing like when decline begins in earnest.

Thats why I need to keep repeating that this isn't some new BAU, that peak oil has not been rescinded to be replaced by POD or Peak Oil Lite or an endless plateau of inconvenience. This is the peak of the oil age and folks need to understand that.

[ROCKMAN]

I agree with you guys…to a point. Perhaps a better way to put it is that all those aspects of the POD act as force multipliers. One simple example: China. If they were consuming the same amount of oil/NG/coal as they were 20 years ago what would oil prices be today? If the KSA weren't having a baby boom and had spent the last 20 years replacing their oil consuming systems with solar power what would oil be selling for today?

And as a back drop to those question assume we were exactly where most of us feel we are: on a global plateau veering towards an inevitable long term decline. In that scenario this site might not even exist. IOW if oil were selling for $25/bbl would any of us be here chatting? How many PO conversations were being shared in 1986 when oil drop down close to $10/bbl? Not many despite the fact that PO was just as predictable decades ago as it is today. I'm obviously a very rare exception given that I was being educated on the subject by my Mobil Oil mentor in 1975. I still recall conversations with my nephew in the mid 80’s about the world his young daughters would see as they reached middle age. I said then that energy would become a critical factor by 2020 or so. No charting…just pulled a date out of my butt. LOL. It wasn’t that I was that smart but my entire profession life was focused on the increasingly difficult task of finding hydrocarbons.

IMHO our conversations today are driven by the price of oil and the political stability of some of the major oil exporting countries and not because production has plateaued. As I pointed out we were producing the same amount of oil in the US in 1997 as we are now and producing a good bit less globally back then. So why weren't we all gathered around the campfire then discussing the end of BAU in 1997? Today we’re producing the same amount of US oil as in 1997 but we’re on an upward climb compared to a long term decline in 1997. Pull up the global oil production curve and cover the section from 1997 forward and what do you see: a plateau from the late 70’s with a dip in the middle. But a plateau none the less. And by 1997 the peak in US oil production was well established. Why no big PO concerns then?

So why no big public discussion of PO in 1997? Easy answer: $25/bbl oil. So again why is oil selling for 4X that amount now? A global plateau in oil production doesn’t solely provide the answer IMHO. The change in third world energy consumption, the changes in oil distribution patterns, political strife, etc. have pushed the price up. But that price increase has also led to a surge in US oil production and national efforts to increase efficiency which has the effect of putting downward pressure on prices. And again thanks to those high prices resulting from the POD we see a huge increase in Canadian oil production and hundreds of $billions spent on developing Deep Water resources.

The current plateau is significant. But there was a plateau leading up to 1997. In fact if someone had drawn the production curve forward in 1997 to look like we are today they would have been labeled an insane cornucopian, would they not? So why are we the least bit concerned now that this cornucopian wet dream has come to be? Oh…yeah…$100+/bbl and $trillions of tax dollars and thousands of lives spent on ME military adventures. And the prospect of more in the future. So again if it were just because we’re on a plateau why a different mindset now than in 1997? Again IMHO it’s due to $100+ oil vs. $25 oil. So why the increase if we’re on a similar plateau as we were 20 years ago? The reason is all those factors that collectively make up the POD. And yes, PO is one of those factors but not the only significant factor IMHO.

[Pops]

Ah, I think I've gotten the wrong impression.

So let me just ask the question, do you think we are at or near peak?

.

[John_A]

$this->bbcode_second_pass_quote('ROCKMAN', 'I') agree with you guys…to a point. Perhaps a better way to put it is that all those aspects of the POD act as force multipliers. One simple example: China. If they were consuming the same amount of oil/NG/coal as they were 20 years ago what would oil prices be today? If the KSA weren't having a baby boom and had spent the last 20 years replacing their oil consuming systems with solar power what would oil be selling for today?

[ralfy]

We are at peak following the BP Statistical Review of World Energy 2013:

http://www.bp.com/en/global/corporate/a ... -2013.html

That is, global crude oil production unable to catch up with oil consumption, which means more reliance on unconventional oil, which has problems with decline curves, etc:

http://shalebubble.org/

This is why the IEA Outlook Report for 2010:

http://www.iea.org/publications/worlden ... /weo-2010/

is, I believe, echoed by subsequent reports in arguing that oil demand increase has to be cut to 0.7 pct a year (from a 2-pct annual average during the past few decades) in order to adjust to oil and gas production realities, and unmet demand addressed by renewable energy. The same organization argues that this will, of course, require major coordination between governments and businesses, especially oil companies that will need to maximize production, with the hope that profits made can be used to find and extract more oil and gas.

Why is there a need to meet the equivalent of a 2-pct increase in oil demand per year? Because we have a growing global middle class that has more resource needs:

http://www.bbc.co.uk/news/business-22956470

plus much of the global economy controlled by a financial elite:

http://www.newscientist.com/article/mg2 ... world.html

which can only get returns on investments and profits as long as more people worldwide (in short, the same growing global middle class) borrow more money to buy more goods made using more energy and resources, including oil. That is why even with demand destruction for richer countries due to too much debt, global oil demand will continue to rise:

http://uk.reuters.com/article/2013/07/2 ... LD20130725

Without more oil demand, economic crisis takes place, and with that all sorts of problems, similar to what we've seen the past five years. And more oil demand obviously means more resources needed, including oil.

In short, we find ourselves in a very difficult situation. We have a global economy which has to keep growing, a global middle class requiring more resources, rich people who can only remain rich if that middle class consumes more, the same rich people influencing governments, governments that want everyone to borrow and spend happily to keep the peace (but which requires more resources, including oil), military forces that want their funding and armaments maintained or increased, environmental damage and global warming taking their toll on the planet, and major preparation, coordination, and cooperation needed among governments that haven't been preparing and that have had a history of not coordinating or cooperating.

[John_A]

$this->bbcode_second_pass_quote('ralfy', 'W')e are at peak following the BP Statistical Review of World Energy 2013:

[Pops]

$this->bbcode_second_pass_quote('Pops', 'A')h, I think I've gotten the wrong impression.

So let me just ask the question, do you think we are at or near peak?

[ROCKMAN]

While increased oil production from Iraq has been offered as a bit of mitigation to global PO but looks like it will be a bumpy road. From today’s Rigzone:

"SINGAPORE, Sept 2 (Reuters) - Asian refiners are grappling with supply uncertainty from Iraq as field and port maintenance and inadequate infrastructure prevent one of the world's fastest-growing exporters from providing steady shipments of oil. Iraqi crude buyers, most of who are in Asia, are caught in a bind as they cannot ignore a producer that has ramped up its output to become OPEC's second-biggest exporter. But Iraq has left refiners guessing about its barrels for a third straight month, prompting many to scurry after alternative grades.

The scramble could continue this month as refiners ramp up purchases and runs to meet winter demand for heating fuels, further lifting premiums already at multi-month highs for spot Middle Eastern cargoes into Asia. Rising seasonal demand aside, refiners are also worried the crisis over Syria could engulf the region and disrupt supplies to markets already coping with losses from Libya.

Iraq's Basra Light crude gained increasing importance in Asia over the last 18 months as buyers switched to the oil to make up for cuts in purchases from fellow OPEC producer Iran due to tightening Western sanctions over Tehran's nuclear programme. But conflicting information from Iraq on crude available for export has made it difficult for buyers to judge supplies. Asian refiners buy Middle Eastern oil two months ahead of loading as it takes at least a month for cargoes to reach the region.

Iraq's State Oil Marketing Organization (SOMO) surprised Asian buyers with a cut of 10 million barrels for initial allocations for August, although actual shipments rose as traders negotiated for more supplies. According to numbers released on Sunday by the oil ministry, August exports averaged nearly 2.6 million barrels per day (bpd), more than 10 percent higher than those in July. For September exports, announcements have also been mixed. An official from Iraq's South Oil Co. said field maintenance would cut shipments by up to 500,000 bpd."

Given the increased violence across much of the region it appears some sort of man induced PO may overcome geologic PO. Iraq may have as much reserve potential as some project...maybe even more. But if the civil unrest problems persist (or even get much worse) it may take much longer to get those bbls out of the ground. If so new Iraq oil development may not stall global PO as much as some have hoped.

[ROCKMAN]

Always amusing to see folks define a situation so as to make their spin more believable. The title of the article appears rather straight forward: “OPEC, US Energy Dept. See Enough Oil In The World”

http://www.rigzone.com/news/oil_gas/a/1 ... _The_World

I figured the POD would be as good a spot for this posting. How various govts try to spin the reality of the situation is as much a part of the dynamic as any other.

“In a monthly report, OPEC said oil stocks in developed countries equaled almost two months of future demand although "some supply outages" had put upward pressure on prices. The U.S. Energy Department expressed similar sentiments after it raised its 2013 estimates of non-OPEC supply while leaving global demand nearly unchanged. OECD inventories stand at a comfortable level of 58.5 days OPEC's report read in part. This figure is above the historical norm and provides confirmation that the market at present remains well supplied.”

So high oil prices have held down demand and thus the “world has enough oil”. I can only assume the Energy Dept would welcome even higher oil prices since that would decrease demand and would provide even more excess oil production capacity. Of course, all this requires defining “the world” as only those who can afford the current price of oil. If one’s economy cannot afford the current cost of energy you are thus no longer a portion of the world. And as OPEC points out the “world” has about 2 months of supply in inventory. I wonder how much inventory is being held by those who are no longer a part of “the world”. Well…that doesn’t really matter since they don’t count.

[radon1]

HSBC predicts Russia will decline in seven years.

Russia has only 7 years before oil crisis?

$this->bbcode_second_pass_quote('', 'A')ccording to some experts, the oil production in 2016 and 2017 in Russia will grow by two percent a year. The peak of oil production will occur in 2018-2019. The British HSBC clarified that the development of new oil fields should be carried out in the best possible conditions for the taxpayers. Oil companies leading the development of these fields will be provided with tax breaks, but this, in turn, will adversely affect the country's budget the due to the decreased revenues.

[SeaGypsy]

$this->bbcode_second_pass_quote('Pops', 'A')h, I think I've gotten the wrong impression.

So let me just ask the question, do you think we are at or near peak?

.

[Pops]

$this->bbcode_second_pass_quote('SeaGypsy', ' ')Do you really think Rock is with us or again' us?

[SeaGypsy]

Ok Pops, I thought I kept a pretty good grip on who says what around here; I will leave it to Rock to assert or deny- Which is it Rock?

[rockdoc123]

$this->bbcode_second_pass_quote('', 'R')OCK doesn't believe we are at or near peak, Gypsy. No different than OF2 or Sam/John or JD, just more amiable. The wrong impression I got was thinking he is a peaker.

[Loki]

$this->bbcode_second_pass_quote('rockdoc123', 'R')ockman merely encapsulates something that has been discussed many, many times on this thread (he just decided to put a name to it) since I joined and that is that it isn't as simple as a Gaussian distribution of production would lead you to believe. It doesn't take a large brain trust to figure out that economics and political constraints and a host of other issues are going to influence production beyond what a series of reservoirs could do if they were produced flat out (and that is exactly what the assumption is that Hubbert made).

[SeaGypsy]

That's how I feel about Rock's position also, very unlike our favorite trolls. To be honest, first time I saw the flagged post of Pops towards Rockman I thought Pops better check his meds lol! The ambiguity referred to by Pops, when I have seen it- all seems to be responding to the trolls in a way that doesn't really support their position so much as dead end that chatter. Rock's not answering the accusation leveled at him signifies what I wonder? Didn't read it?-Doubtful as he seems to read almost everything anyone writes on here and respond accordingly. Can't be bothered responding to a bit of a nasty aspersion? More likely. From what I have seen Rockman's posts generally can be described as good hearted, humorous, insightful, open to challenge and flexible in position. I like the guy and would have him over for dinner with the family any time. (I like most folks here now- even the ones who annoy the crap out of me at times though, so maybe I'm not the right one to be judgmental).

Not being at all willing to set a date- does that put one as a denier?

[radon1]

$this->bbcode_second_pass_quote('Loki', 'F')act is, supply is currently having an awfully hard time keeping up with demand, despite desperate price signals, and there is nothing that would suggest this situation will improve with time.

[Pops]

Did I say ROCK was a troll?

No. I said he doesn't seem to think we are near peak.

Why the long faces? LOL


--
$this->bbcode_second_pass_quote('roc', 'J')esus wept.....give it a break Pops. You presume to understand the topic of Peak Oil as if you were the King Hubbert whisperer...

In the end it doesn't matter.

[ROCKMAN]

Wow guys. Rockman getting swelled head with all this attention. LOL.

First, do I believe in global PO? Yeah...starting in about 1976 when my first mentor explained it to me. Can anyone here date their belief that far back? I also had a firm grasp of GHG effects and the potential for climate change back then also. Anyone else here? It's not that I don't believe in the date of global peak oil...I just don't give a crap when it has or will happen.

It is the POD that determines what we pay for oil & gasoline & diesel & fuel oil & etc. The POD also determines how much of our treasury we spend defending oil producing regions and how many thousands of lives are lost on the process. Many folks think that PO happened in 2005. Let’s accept that for the moment. If PO is the critical factor determining the price of oil why was it selling for just $40 to $50 per bbl back then? And if we were running into PO why was it selling for half that just 5 or 6 years earlier? And if oil hit $140/bbl in 2008 because we either had reached PO or were at least getting close to it than why did oil fall to $50/bbl or less during the first part of 2009? Did PO suddenly just cease to exist?

Maybe because the folks who buy/sell oil don’t make those decisions based upon whenever the heck PO may have or will occur. One more question: if oil is priced on the basis of global PO than why was there recently a $30+ spread between different oil sold in different regions? Maybe it was because of local market demand & logistics & political instability & environment policies & etc. IOW all those DYNAMIC FACTORS that impact demand and pricing. Did everyone notice that in my list of factors that global PO timing wasn’t one of them?

Folks what to think their energy future hinges on the date of global peak oil…have at it. Me, I think I’ll focus on ELM, political instability in the ME, China tightening their grip on future oil production, increased US oil production thanks to high oil prices, development of Deep Water oil fields, etc., etc. IOW I’ll stick with the POD. It explains everything we’ve seen in the past and controls all that I expect to see in the future IMHO. And that has nothing to do with the undeniable fact that one day we’ll never produce oil at a greater rate than on that day or the fact that the date of that event has little bearing on the impact of energy on society compared to all the other dynamics involved IMHO.