What You Need to Know about Peak Oil

Examines the Peak Oil debate from both sides and attempts to provide the information you need to better understand this complex, but very important issue.

Apocalypse. The end of the world as we know it. A return to the Dark Ages. Those are some of the scarier phrases used to describe the upcoming peak in global oil production, commonly known as simply “Peak Oil.” Peak Oil refers to the point at which new oil production can no longer keep up with declining oil fields, and this results in a yearly decline in the amount of oil produced. Since the world has become increasingly dependent upon petroleum year after year,1 declining petroleum production has the potential to severely disrupt our lives through much higher prices and fuel shortages.

Discussions of Peak Oil really began to enter the mainstream in 2005. Congressman Roscoe Bartlett gave a speech about Peak Oil on the floor of the U.S. House of Representatives.2 After Hurricane Katrina caused oil and gasoline prices to spike3 people began to ask serious questions about our oil supplies. The issue began to receive more attention from the mainstream media.4 This essay will discuss the history of Peak Oil discussions, the potential ramifications from a peak in oil production, the influences of the supply/demand imbalance, and finally what you need to do to prepare for Peak Oil.

The history of the study of Peak Oil goes back to the 1950s, when Shell geophysicist M. King Hubbert5 reported on studies he had undertaken regarding capacities of oil and gas fields. Hubbert predicted that oil production in a particular region would follow a bell curve, rising to a peak when half of a field had been extracted, and then going into decline. Hubbert applied his reasoning to oil production in the continental U.S., and in 1956 he predicted that U.S. oil production (not including Alaska, which was not granted statehood until 1959) would peak in 1970.6 Hubbert