[Graeme]

This article is mainly for newbies, but what interested me is that the authors state that we haven't reached world peak oil yet. See the paragraph - production is increasing in the rest. . .

Peak oil: “It’s the flows, stupid!”

$this->bbcode_second_pass_quote('', 'P')eak oil is about peak flow. It’s that simple, despite all those lame statements (some from people who ought to know better) that “we aren’t running out.” That’s right, we aren't, but who said we were!

Peak oil describes the maximum flow rate of oil from a well, an off-shore platform, a field, a basin, or a geographic area—state, nation, continent, and eventually the world. Webster’s defines “peak” as “the highest or most important point.”

The math determining present and future flow rates is simple:

85 percent of the world’s oil is produced by the 21 largest producers.

Production declines dominate the story in six of those large producers: the USA, Indonesia, the U.K., Norway, Mexico and Venezuela.

Flat or volatile production rules in five more: Russia, Iraq, Iran, Nigeria and Algeria.

Production is increasing in the rest. But China is nearing peak. Saudi Arabia, Kuwait, Qatar and the United Arab Emirates are not planning much more expansion. Canada and Libya can continue growing, within limits. Of this crowd, only Brazil, Kazakhstan and Angola are likely to grow production sufficiently to make a difference past 2010.

Some factors act like dragging anchors on these flow rates:

Geologic limits. We drilled the easy pickings first. Most new barrels—from offshore Brazil to the Bakken play in North Dakota and Montana—are smaller or harder to drill than the older giant fields they’re trying to replace.

Non-OPEC production is flat, “mature” and underperforming, with few prospects for change.

The world’s oil system lacks the skilled labor, equipment, and rigs to help us smartly increase production off the recent three-year plateau. Delays from major projects like Thunderhorse are the norm.

OPEC’s reserves are increasingly off-limits, and prevailing petronationalism won’t quickly reverse. To quote an industry player, “yesterday’s Big Oil is today’s small oil.”

While investments to expand production are optional, depletion is mandatory and relentless. In a horse race with technology, eventually depletion will win the day.

Rising domestic demand by major oil producers Russia, Iran, Venezuela and Mexico drives down their exports. Expect peak exports to hit before peak oil.

Unconventional oil is more expensive and slow, with a small energy balance and a large environmental footprint. Unconventional oil will likely be a herd of turtles rather than the cavalry on which many are pinning their hopes.