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Page added on March 29, 2017
Peak Oil: Not Just Wrong but Invalid
“Production in a region rarely follows a bell curve nor do regions necessarily experience a single peak. As a result, this method repeatedly predicted premature peaks for many countries and for the world itself.”
“Production patterns are determined by the geology and chemistry of the deposit, plus the engineering decisions on how to produce it, plus the fiscal regime in place.”
Although the insistence that “peak oil” was imminent has largely faded from public view, it remains a valuable illustration of how poorly developed theories can nonetheless catch the public’s imagination, including those who should know better. So what were the theories and methods that were employed to support peak oil, arguments that a library of articles and books repeated to create a false narrative (and, undoubtedly, a ‘97% consensus’).
The original claim underlying peak oil was that resource scarcity would cause oil production to decline in the near future and that nothing could be done to alter that trajectory. Two retired oil geologists—Colin Campbell and Jean Laherrère—justified this idea by making their estimates of recoverable resources using a private database of oil field sizes fitted to the so-called Hubbert curve, a bell curve said to represent production for a region.
Their theory was that since production followed a bell curve, fitting production data for a country or region to a curve would demonstrate the entire trajectory of supply and yield an estimate of the total resource. Also, once half the resource was produced, production would decline; and conversely, if production was declining, then the peak had been reached and half the resource produced.
Actually, though, production in a region rarely follows a bell curve nor do regions necessarily experience a single peak. As a result, this method repeatedly predicted premature peaks for many countries and for the world itself.
Laherrère attempted to reinforce his claims by the use of so-called creaming curves, ordering discoveries by date to show how their sizes decline over time; the asymptote of the curve would then represent the total resource. This method is employed by conventional petroleum geologists, but with this understanding: It works only for a given basin, not a combination of them; it cannot predict the discovery of new basins; and it requires stable estimates of field size.
The peak-oil theorists ignored the first argument, insisted both that no new basins remain to be discovered and that their field size data was stable. (However, they elsewhere chided economists for not recognizing that field size data was often revised upwards.)
The shortcoming was made worse by the insistence that the results were robust, which they were not; as regards the Middle East, for example, creaming curves yielded an estimate that was revised upwards three times. It was simply asserted that the final estimate was correct, and earlier ones not, without recognizing the implication that the method did not yield a stable estimate but one which evolved over time.
Another freshman mistake was to rely on graphs of cumulative data, specifically discoveries and production, which Laherrère noted seem to resemble each other. The first thing taught in freshman statistics is that cumulative numbers are meaningless: next year’s GDP may change substantially compared to this year’s, but if you put a century’s cumulative GDP on a graph you can see no difference.
However, Laherrère in particular believed he has created a ‘model’ whereby he could predict a country’s production by looking at its cumulative discovery trend, although his graphs showing individual discoveries in a country made it clear that they were highly variable and related poorly to subsequent production trends.
The one thing in common with these methods was that they represented curve-fitting, just extrapolating discovery and production trends (and sometimes not accurately). Because some of the proponents are geologists, they claimed that the work was “scientific” and derided their opponents as economists, even though many petroleum engineers and geologists disagreed with their work.
Kjell Aleklett, who took over the leadership of the Association for the Study of Peak Oil despite having little experience in the analysis of resources, insists that his work is “natural science” even though there is no real scientific content: he and his colleagues observe trends and assume they are determined by physical factors.
Which is obviously wrong, given that the so-called scientific behavior is often violated. As mentioned, few countries exhibit a bell-curve shaped production trend, and many of the fields that are said to follow a mathematically precise behavior later violate it. Laherrère has noted that the Forties field production followed a declining trend for years, suggesting that the field’s total resource could be estimated by extrapolating it to the intersection with the x-axis.
The addition of gas-lift caused production to differ from the trend briefly, but then the trend resumed to his great delight—proving, he insisted, that geology determined the profile of a field’s production.
Nonsense. Since he published his graphs, the Forties oil production trend has changed, going flat instead of declining for roughly ten years, with an increase in the field’s proved reserves of 150 million barrels. Production patterns are determined by the geology and chemistry of the deposit, plus the engineering decisions on how to produce it, plus the fiscal regime in place. The latter two can change, as was the case with the Forties field and many others. New investment regularly adds reserves to mature fields, and the trade press is full of articles describing such additions.
More Peak Oil Fallacy
A certain amount of circular, reality-defying logic was also employed in peak-oil theory. Aside from the bizarre suggestion that only geology affected supply, not politics or economics, the insistence that estimates of field sizes did not change and that technology could not increase the recoverable portion of oil was nonsensical from the beginning. Recovery rates have been growing gradually over time, and numerous new methods and inventions have greatly increased the amount of oil that can be extracted.
But for the creaming-curve method to function this had not to be so to function, and in response, peak oil advocates like Jean Laherrère would claim that overall field size increases occurred only in the United States, owing to its industry’s reliance on a more restrictive and conservative definition of reserves. Yet various other sources all noted field size increases in other international settings. And when asked about new technologies, peak-oil theorists claimed that they only increased production rates, not recovery. Again, all the evidence is to the contrary.
Lastly, in a move that should puzzle the typical high school math student, Princeton geologist Kenneth S. Deffeyes developed the “Hubbert Linearization” method. This involves graphing annual production divided by cumulative production on the y-axis against cumulative wells, production, or time on the x-axis.
Naturally, the result is a declining curve because the y-axis denominator, cumulative production, is growing over time. After a century, you get a curve that looks like it’s heading towards zero, an inevitable result that Deffeyes used to predict world oil production would peak in November 2005.
Obviously, the very structure of this “equation” means that any data series will yield the same results, whether it’s global oil production, U.S. GDP, or sales of Hostess Twinkies. All that is being demonstrated is that the annual level becomes small compared to the total historical production as time passes.
Faulty Tradition
Numerous articles about neo-Malthusian theorists, including Paul Ehrlich’s The Population Bomb and the Club of Rome’s The Limits to Growth, point to the failure of these predictions without clearly explaining why they failed, leaving many to argue that the theory was sound and the error was only in the calculation of the date of peak production.
Such a rationalization is hardly new: Sixteenth century London astrologers predicted the date when the Thames would flood and destroy London; when it failed to do so, they pacified the angry crowd by assuring them that “…by an error (a very slight one) of a little figure, they had fixed the date of this awful inundation a whole century too early. The stars were right after all, and they, erring mortals, were wrong.” [1]
In other words, the model was correct; a bad piece of data was to blame.
The same is true with neo-Malthusians. Colin Campbell first predicted that world oil production would peak in 1989, a date he repeatedly delayed without admitting to error. Ehrlich has never admitted that the conceptual model underlying his prediction of looming mass starvation was simply wrong, and The Limits to Growth authors, revisiting their 1972 work thirty years later, insisted that the great increase in oil supply simply meant the world was that much closer to the end.
A realist academic would say: No, your model was underspecified and thus yielded incorrect conclusions.
Decision-makers are rarely able to analyze claims and research in any depth, owing to constraints on their time. But it is truly bizarre that such superficial work, based on simplistic and obviously flawed theories and math, should rate such lengthy attention. It behooves us all to pay more attention to the details.
51 Comments on "Peak Oil: Not Just Wrong but Invalid"
Cloggie on Wed, 29th Mar 2017 10:55 am
Colin Campbell first predicted that world oil production would peak in 1989, a date he repeatedly delayed without admitting to error.
Once a collapsenik, always a collapsenik.
You develop/adopt a theory, you are fascinated by it and you begin to broadcast it and tell it to everyone who wants to hear it, digging yourself socially into an ever deeper hole.
Before you know it, you have solar panels on your roof, grow your own vegetables, or even retreat to other countries, waiting for the “inevitable” collapse moment… that never comes.
Plantagenet on Wed, 29th Mar 2017 10:58 am
No doubt the mathematical approaches used by Hubbert, Campbell, Lahere and others to predict the coming of peak oil in 1989, 2000 2005 etc. were flawed. However, Michael Lynch does not address the core idea of the peak oil theory, which is that oil is a finite resource.
Cheers!
forbin on Wed, 29th Mar 2017 11:05 am
More Peak Oil Fallacy
By 1979, oil production from the Forties field peaked had at 500,000 barrels per day.
today production is around 60,000 barrel/day.
so yah , no peak oil …….
efarmer on Wed, 29th Mar 2017 11:08 am
Fossil fules are finite, people who wish to conjure the exact date and manner of their meaningful time horizon to scale are numerous but probably finite as well. Fossil fuels and people are finite, but people wish they and fossil fuels were immortal, and it is best not to picador them about it, as it is a waste of time.
onlooker on Wed, 29th Mar 2017 11:13 am
This entire argument by the shill Lynch is bogus. Were predictions hasty and somewhat inaccurate. Yes. But that in no way invalidates their basic premises. He contradicts himself the models were inaccurate but under specified. While humans are very clever and have been able to continue to defy limits to growth particularly in sustaining the current huge population, this has further imbalanced the carrying capacity of the planet relative to population. non renewable resources are becoming scarce, the planets ecosystems are in poor condition and getting worse, and even renewable resources are being strained. Simply because timelines have surpassed expectations does not change the unsustainable nature of so many humans and their impacts and demands upon the Earth
rockman on Wed, 29th Mar 2017 11:20 am
“Production in a region rarely follows a bell curve…”. Thank goodness: could stop reading at that point. If he doesdn’t even understand something as simple as a production curve I doubt there was anything else weorth reading. There has never been a region, trend field or even a well that did not generate a “bell curve”. It may have been very asymmetric. It might have multiple peaks. But in every situation production begins, increases and then declines. Thus is the definition of a bell curve. And no: being symmetric is not part of the definition but just represents one specific case. And the vast majority of production curves are asymmetric with tales beyond the apex often much longer then before the apex. Which is why predicating URR is difficult even after production began its decline.
This is not a theory…just as PO is not a theory. The trends that Hubbert predicted to peak in the 70’s did just that. And have continued to decline since then. The US shale plays did increase US oil production nearly to a new peak. But those trends were not part of Hubbert’s model. And neither were the offshore trends. Just as Hubbert explained in his report.
Every well, every field and every trend that has been developed and depleted has peaked and produced a bell shaped production curve. In the case of the Eagle Ford it may have reached its peak. A future oil price increase could bring about an increase in EFS production but it may never reach its former level: every trend has a finite number of potential locations to develop. Only time will tell if thed EFS trend has passed that midpoint.
GregT on Wed, 29th Mar 2017 11:30 am
“The US shale plays did increase US oil production nearly to a new peak. But those trends were not part of Hubbert’s model. And neither were the offshore trends. Just as Hubbert explained in his report.”
Why is this so difficult for people to understand?
Revi on Wed, 29th Mar 2017 11:39 am
Michael Lynch. Need I say more…
Davy on Wed, 29th Mar 2017 11:45 am
Michael Lynch is a narrow minded cornucopian needing to sell books and himself. That pretty much explains his point of view. Peak oil dynamics has evolved and it seems many on both sides have not. Lynch is one of them.
Jerry McManus on Wed, 29th Mar 2017 11:55 am
Yawn. Same old dead horse Lynch has been beating threadbare for many years now.
Everything he has ever said basically boils down to:
“Peak oil idiots and other neo-malthusians are just a bunch of alarmists who don’t have a clue how the world actually works”
Hard to believe he’s still getting paid to peddle that crap.
Michael Lynch: Not just wrong but irrelevant.
There fixed it.
________________________________________ on Wed, 29th Mar 2017 12:37 pm
Mike in not just gay, but a tranny
________________________________________ on Wed, 29th Mar 2017 12:41 pm
So is Clogged up ass-monkey from Sweden or what ever faggy country your from
Cloggie on Wed, 29th Mar 2017 12:52 pm
I agree that Sweden is a faggy country.
Shouldn’t you be dead considering your terminal nick?
davy-fan on Wed, 29th Mar 2017 1:07 pm
He’s trolling us all with his use of money capital to abstract away reality. He’s out to battle but it’s a battle with a select group of energy enthusiasts. In any field of study there are subgroups within it.
Goat1001 on Wed, 29th Mar 2017 1:09 pm
Oil is a finite resource and the amount of oil in the ground – less what has been extracted so far – has remained essentially constant. New technology has served to “pull in” production from the future toward the present, distorting the ultimate global bell curve. Rather than a gradual slope past the peak, thanks to advanced extraction technology, we will see a more abrupt and shocking drop into the abyss…
Sissyfuss on Wed, 29th Mar 2017 2:04 pm
Onlooker, a succinct and perceptive observation. Well done. And Cloggospiel, spell Assphincter. Don’t copy now.
Survivalist on Wed, 29th Mar 2017 2:11 pm
View the graph at the top of this page.
http://crudeoilpeak.info/latest-graphs
World minus USA and Canada has been flat since 2005.
Take a bell curve and then think about doing a shit load of infill drilling when your at the peak. This exercise will give you a Seneca Curve. The infill drilling will bring future production to the present thereby giving a longer plateau followed by a steeper decline. Cornucopians appear to be duped by the plateau.
Apneaman on Wed, 29th Mar 2017 2:16 pm
Hair clog, if Sweden if faggy what does that make Holland? A country that prides itself on flowers and little wooden shoes. Sounds like a nation of fudge packing poo miners to me. Limp wristed sissy boys. Bed wetting homos.
Truth Has A Liberal Bias on Wed, 29th Mar 2017 2:37 pm
I can’t wait until Holland is underwater. It’s a horrible little shit hole populated by nasty fat little weaklings.
Cloggie on Wed, 29th Mar 2017 3:02 pm
Hair clog, if Sweden if faggy what does that make Holland?
Worry about your Canada, Friedman:
http://www.eurocanadian.ca/2017/03/definition-of-canadian-conservative.html
http://www.eurocanadian.ca/2017/03/english-canada-journey-to-back-of-bus.html
Outcast_Searcher on Wed, 29th Mar 2017 3:02 pm
Truth — you seem to be confused. You’re acting like a fascist instead of a liberal, re your hating on Holland.
Outcast_Searcher on Wed, 29th Mar 2017 3:07 pm
Survivalist: Thus far by far most of the Fracked oil is from the US. That doesn’t mean the geology won’t support a LOT of fracking globally, just that mainly for economic incentive, cultural and legal reasons, that the US was early to the party.
Yes, peak oil is real, and yes, maybe the downside will be steep — though no telling how many further technological enhancements may extend the time and amount of oil to be recovered.
But as long as the time is extended for at least a couple/few decades, then the substitutes via things like EV’s, PHEV’s, better batteries, better energy storage, and green energy tech will GREATLY alleviate the problem.
But let’s pretend it won’t so we can play all doom all the time.
I’ll pass, and try to live this life. Enjoy your doomstead, fantasies of doom, etc.
James boags on Wed, 29th Mar 2017 3:10 pm
Me thinks lynch’s agenda is to keep oily investor optimistic nothing to see here sheeple move along..
Cloggie on Wed, 29th Mar 2017 3:29 pm
THALB opines: “I can’t wait until Holland is underwater. It’s a horrible little shit hole populated by nasty fat little weaklings.”
http://www.bbc.com/news/science-environment-36888541
Antius on Wed, 29th Mar 2017 4:49 pm
Maybe Michael Lynch can make that bottle of whisky in my drinks cabinet last forever.
I wonder who these people are trying to convince and why. Average discovery rate has been declining for decades. Unless there is a miraculous turnaround, production will inevitability go the same way. The exact timing is difficult to predict, but the outcome is inevitable.
Davy on Wed, 29th Mar 2017 5:29 pm
Thanks, clog, I was going to post the BBC article for liberal butt love but you beat me too it. He is from Montreal where the boys carry purses. He claims to have a doomstead in the mountains somewhere but it is probably a summer hut. He likes to brags about his $30k a year investment income like that’s special. Do you need any more intel on the dumbass?
Davy on Wed, 29th Mar 2017 5:39 pm
Finally, outcast, you are showing some reality along with your techno optimism.
tk on Wed, 29th Mar 2017 5:41 pm
From my point of view the last somewhat reliable
numbers were this:
http://www.theoildrum.com/files/ccst20091119.png
This page needs to be re-named into
“oildepletion.com”
since the peak is several years behind us…
Even Reuters recently had an article about declining oil exports from Saudi into the US:
http://www.reuters.com/article/us-opec-saudi-usa-idUSKBN16U2OY?utm_source=twitter&utm_medium=Social
and another about Venezuela:
http://mobile.reuters.com/article/idUSKBN16V2D5?utm_source=Twitter&utm_medium=Social
DMyers on Wed, 29th Mar 2017 7:06 pm
Lynch is somewhat a necrophiliac. He’ll fuck it when it’s dead. Peak oil is dead. That is the message which envelopes everything he says here.
That’s all he hands out, take it or leave it. This article proves he knows nothing about peak oil. For him the only issue is whether the bell curve superimposed by Hubbert is perfectly symmetrical. If not, then Hubbert is patently refuted. That’s his reasoning and that’s the depth of this thought on the subject.
For a few of us, the subject is more complicated than that. For example, is all oil, i.e., conventional and “unconventional”, created equal? Lynch clearly assumes this is the case. The grounds for this assumption? Wishful thinking. That’s what he does best.
Truth Has A Liberal Bias on Wed, 29th Mar 2017 7:51 pm
I will smile the day Holland sinks beneath the waves. The bloody Dutch are a vile race of troglodytes and half wits.
Truth Has A Liberal Bias on Wed, 29th Mar 2017 7:54 pm
I’ve never read as much gibberish from retards as the morons that frequent the comments section of this pathetic blog. It’s not even a blog. They just repost shit from other sites. What a bunch of bottomfeeders.
Truth Has A Liberal Bias on Wed, 29th Mar 2017 7:55 pm
Oh and it’s called comments section not dialogue section. Get some friends you fucking losers.
Gaping Anus on Wed, 29th Mar 2017 9:29 pm
Holland a cornucopia of drugs and cheap whores. It is europes whore house. In a word- utopia. If you need senior citizen Siamese twin hookers to give you a rim job then Holland is your home. The women of Holland are the finest whores in the world.
Apneaman on Wed, 29th Mar 2017 9:32 pm
Truth, have you ever actually been in another comments section? Sharing links is as common as your repetitive comments. You haven’t had an original thought the whole time you have been here you fucking goof. Reading your comment reminds me of every morning just before I flush – looks the same and smells the same – different day.
Cloggie on Thu, 30th Mar 2017 2:18 am
Davy says Do you need any more intel on the dumbass?
Any idea of the color of THALB’s handbag? Pink? Violet?
And is he the plug or the socket in a relationship of erotic nature?
And the “Gaping Anus” from Vancouver (who apparently is not “serviced” as much he would like, otherwise it would not be “gaping”) opines:
The women of Holland are the finest whores in the world.
https://en.wikipedia.org/wiki/Mata_Hari
https://en.wikipedia.org/wiki/Xaviera_Hollander
https://en.wikipedia.org/wiki/The_Happy_Hooker_(film)
spike on Thu, 30th Mar 2017 2:43 pm
Ignoring all the trolling here, two points (substantive). First, the constant refrain that “oil is finite” is both wrong and not relevant. (Read chapter 4 of my book.) Whales are not finite but we don’t use them for fuel because there aren’t enough; oil is finite but so plentiful that is irrelevant.
And Rockman, you are confusing exponential trends with bell curves. If a bell curve has multiple peaks and is asymmetrical, it isn’t a bell curve. And if countries don’t follow a bell curve, you can’t use a bell curve to estimate resources. Growth does tend to be exponential, but that isn’t the same as a bell curve.
newfie on Thu, 30th Mar 2017 5:13 pm
Apparently the Earth is a like a huge chocolate coated nougat filled with creamy petroleum. Alas the more we burn the hotter the planet gets. The real news is that we will cook the planet before we run out of oil.
spike on Fri, 31st Mar 2017 5:20 am
Well, Newfie, you’re correct that we have the fossil fuels to do some serious damage. But if you watch my video lecture https://www.youtube.com/watch?v=I23uAdBwR6Q
you will see actual numbers!!!
HarrietTubmanFanClub on Fri, 31st Mar 2017 5:50 am
Those who are interested in Hubbert Curve math and not just slinging insults may find this interesting http://www.energytrendsinsider.com/2017/03/28/the-peak-oil-estimate-you-wont-believe-a-tale-of-two-sigmoids/ .
GregT on Fri, 31st Mar 2017 11:09 am
“Whales are not finite but we don’t use them for fuel because there aren’t enough”
That’s like saying that the cup of coffee on my desk isn’t finite because I stopped drinking it.
Makes about as much sense as the rest of your argument.
spike on Fri, 31st Mar 2017 1:52 pm
No GregT, it’s like saying the cup of coffee on your desk is finite, but there’s a Starbucks downstairs.
GregT on Fri, 31st Mar 2017 3:08 pm
“Whales are not finite but we don’t use them for fuel because there aren’t enough”
They’re aren’t enough because their numbers are finite.
makati1 on Fri, 31st Mar 2017 5:47 pm
GregT, and interesting fact – The Japanese are still killing whales for food. They claim they are for ‘scientific’ purposes but why would they need hundreds every year?
http://q13fox.com/2016/03/24/japanese-whaling-fleet-kills-maximum-number-of-whales-allowed/
“A four-ship fleet from Japan’s Institute of Cetacean Research traveled to the Antarctic Ocean and killed 333 minke whales. Some 230 were female; about 90% of these were pregnant, according to the report.”
(Is the ‘Institute of Cetacean Research’ a new restaurant chain in Japan? lol)
Over 1,000 whales are killed every year around the world according to the many different stats I could find.
makati1 on Fri, 31st Mar 2017 5:49 pm
Sorry Spike, but the Starbucks is going out of business because their customers cannot afford their product anymore. Ditto for oil.
onlooker on Fri, 31st Mar 2017 7:06 pm
I am not sure if Spike is using the an economic/tech argument or geologic (abiotic), to peddle the meme that we have a 100 years of oil left. Both are wrong. The tar sands/shale will remain uneconomic because you cannot divorce the nature of those reserves from being energetically taxing to exploit, no matter what new tech comes online.
onlooker on Fri, 31st Mar 2017 7:08 pm
sorry testing
onlooker on Fri, 31st Mar 2017 7:14 pm
testing
spike on Mon, 3rd Apr 2017 5:57 am
GregT, whales are not finite, they are renewable.
spike on Mon, 3rd Apr 2017 5:58 am
makati1, do you really think Starbucks is going out of business?
spike on Mon, 3rd Apr 2017 5:59 am
Onlooker, you are making a static estimate of resources and their economics. Just as shale oil went from too expensive to exploit to threatening OPEC, so can other resources when you talk about decades into the future.