PEAK OIL The Major Media Accepts The Concept

Oil producers can no longer keep up with demand, says the Wall Street Journal, giving the “Peak Oil” theory a de facto nod of authenticity.

According to the data, Saudi oil production is down over 600,000 barrels per day, some 7.6%, while Mexico’s output has fallen over 17% per day, Venezuela’s 8%, and Norway’s nearly 10%. In all, the world’s major oil producers are delivering a million barrels less per day than they were at peak production. Making matters worse, consumption remains steady to slightly higher at 86 million barrels per day.
Indeed, the old “perfect storm” cliche’ applies to the situation as “Soaring profits from high-price crude have fueled a boom in oil demand in Saudi Arabia and across the Middle East, leaving less oil for export,” while “At the same time, aging fields and sluggish investments have caused exports to drop significantly in Mexico, Norway and, most recently, Russia.” Adding fuel to the fire is the fact that “The Organization of Petroleum Exporting Countries also cut production early last year and didn’t move to boost supplies again until last fall.”

The end result being that there is not enough oil to meet current demand, and the prospects for future production increases are uncertain.

Financial Sense