Peak oil

Peak Oil? Cue Crickets Chirping

Great article asks "Whatever Happened to Peak Oil?" over at RealClear Politics*

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PeakOilGrist
grist

Apparently Google searches for the terms like "oil glut" and "too much oil" are now much more popular than those for "peak oil" from a decade back. Back in in 2009, I wrote:

In May 2006, I reported in Reason that global oil reserves were ample to supply humanity's needs for liquid fuels until at least 2030, despite headline-grabbing predictions that our supply had already peaked. Afterwards, the world experienced an unprecedented run-up in oil prices topping out at $147 per barrel in July 2008, which led some negative prognosticators to get a little cocky. One of the leading doomsters, Houston investment banker Matthew Simmons, told CNBC in July 2008, "The idea that it's a bubble is all poppycock." He confidently added that the price of oil "is not going to collapse." Simmons advised Americans to move into villages and to buy locally produced foods and goods.

Prices did surge again, but human ingenuity in form of fracking and other innovations proved again that extent of resources is determined by technology and markets not just the accumulation of stuff in the ground. Global production soared and prices fell. The peak oil chorus of doom has largely gone silent. Over at RealClear Politics, there is a terrific article detailing the sorry history of periodic peak oil hysteria. From the article:

This perception that we would run out of oil, and sooner rather than later, became more than a theory, one that went by the name "peak oil." It became a kind of catechism. It was included in the prayer books of the environmental movement and incorporated into the legislative history and language of U.S. federal energy policy. It became an underlying basis for everything from Jimmy Carter's admonition to turn down the nation's thermostats, the enactment of 55-mile-per-hour speed limits, and federal mandates on gasoline standards for cars and trucks.

Today, the question is how policymakers should one react when the conventional wisdom is proven so spectacularly wrong, as is the case here. …

One factor the peak-oil adherents never seemed to consider was that the supply of oil, like many commodities, was directly influenced by price—and that drillers and investors previously not searching for it would return to exploration if market prices became high enough.

"The biggest supporters of Peak Oil almost all are petroleum geologists; almost none of them are economists," said Ronald Bailey, an author and science correspondent with Reason magazine who has written extensively on climate and energy. "They really don't understand markets."

*Oh, wait. The article quotes me. Despite that, reading the whole column is well worth your time.

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  1. Peak Oil: We’re All Fracked

        1. Shenanigans!

          1. Reasonhas breathed new life into Peak Poppycock by publishing Pat Michaels’ latest paean to Bad Climate Science :

            http://vvattsupwiththat.blogsp…..o-for.html

  2. We will reach peak oil about 5 minutes before a technology that makes oil unnecessary becomes available.

    Just like we once reached peak buggy whip.

    1. The lessons of the market are always forgotten when emotion–the need to save Mother Gaia!–takes over policy making.

      1. The lessons of the market are deliberately obscured by the Progressive Elite, who hate the market because it doesn’t listen to their wonderful advice.

    2. Remember when whale oil became difficult and expensive and we started using all that naptha that was bubbling up from the ground and sometimes poisoning springs?

  3. At this point the best strategy is to ramp up the war on terror and use that as a pretext to bomb production facilities thereby reducing output and raising the price. However, you should do that only in countries that are not our allies, like Saudi Arabia and Iran. Canada is susceptible to ‘wildfires’ and the US can have ‘spills’.

    1. No, the best strategy is to continue to substitute your global warming religion as a reason we have to leave it all in the ground. Strangely enough Bailey doesn’t clutch those pearls here even though he is very concerned.

      1. Poor Weigel is a severely mentally ill little cretin.

        He’s also a lazy, worthless piece of crap who can’t hold down a job or finish a book.

        1. Yikes. Who pissed in your fruit loops this morning?

          1. How many times do I have to tell you that your book isn’t going to magically finish itself, fuckface?

            1. If you would just stop pretending that you know a lot more than you really do, maybe you would stop making yourself look stupid by making these cockamamie allegations that always turn out to be completely wrong.

            2. “book isn’t going to magically finish itself”

              Sounds like a man who doesn’t believe in the magic of orphan labor!! Those urchins write real-fast when you show ’em the whip!!

  4. Look, the science was decided. A consensus was reached. You’re not denying science, are you?

    Also, wherever he is today, Julian Simon is laughing his ass off.

  5. The biggest supporters of Peak Oil almost all are petroleum geologists; almost none of them are economists…

    But everyone knows that, unlike geology, economics isn’t an exact science.

    1. Despite the talking points, there is something that keeps getting ignored.

      The “peak” the geologists agreed on was when we’d see declining availablility of oil with currently known techniques. It is something that can exist, but the inability to predict the type and capability of new techniques before they are developed means that the only information they can work with is what is known at the time. Fracking moved the peak back and lends creedence to the potential that new developments will keep us in oil until we develop technologies that get us away from such high dependency upon it.

      1. That’s a good point. I had a brief conversation with a colleague the other day in the course of which I made a snide comment about Malthus. He assured me that Malthus hadn’t been proven wrong, just that not enough time had gone by to prove him right. I briefly thought about discussing technological change but decided better of it.

        1. just that not enough time had gone by to prove him right

          You could say the same thing about the Rapture.

        2. “Malthus hadn’t been proven wrong, just that not enough time had gone by to prove him right”

          But Malthus’s theory /had a set timeline/. If “not enough time has gone by to prove him right”, his theory overall is wrong. Even if (big if) a part of it can said to be true, he still fucked up the timeline, which was a part of his theory and has been proven wrong.

          1. No doubt. But I’ve become a pretty good judge of which conversations are worth having with which people. And this was not one of them.

      2. And the fact that the EROI on oil has continued to fall. But that pollutes the narrative. And geologists and petroleum engineers understand that the quantity of reserves is a function of their price better than philosophy majors.

        1. N: And yet the philosophy major has been right and the peak oil geologists wrong.

        2. And geologists and petroleum engineers understand that the quantity of reserves is a function of their price better than philosophy majors.

          Perhaps true for the silent majority of them.

          Unfortunately, those aren’t the ones that journalists and other proselytizers of hype listen to.

      3. The “peak” the geologists agreed on was when we’d see declining availability of oil with currently known techniques.

        In the first place that is false. Hubbert among others most certainly took technology into consideration in his bombastic predictions. And for those geologists that don’t understand or ignored changes to extraction technology their prognostications can be safely ignored.

      4. The “peak” the geologists agreed on was when we’d see declining availablility of oil with currently known techniques.

        California will never reach peak water.

    2. It’s an interesting case study in specialization and how that affects your perception of a problem.

      1. Especially if your specialization is journalism.

  6. It is so satisfying to see the peak resource alarmists be proved wrong.

  7. Ron does by far the best self-satisfied, “IN YOUR FUCKING FACE, WHAT’S UP NOW BITCHEZ?!” articles. And that is not criticism, I love it. I love it that someone isn’t willing to let these things slip down the memory hole. Ron needs to be sitting in the back of congress, whispering constant reminders to the speaker like an old Roman slave.

    1. Ron is a pimp among squares.

      1. I picture that rat creature from Jabba’s Palace cackling hysterically

  8. “…Simmons advised Americans to move into villages and to buy locally produced foods and goods….”

    I think this guy posts on a couple of boards.

    1. All I have to say is that if this guy is just an investment banker, he can keep his grimy butt out of our village.

      We have enough grasshoppers already.

  9. Peak oil, population bomb, CAGW, …. all are really the same type of lunacy promoted by many of the same actors like the wrongest people in the Galaxy: Paul Ehrlich, James Hansen, Gavin Schmidt, etc…

    1. Thank you. This is exactly correct.

      Someone set us up the bomb. And it wasn’t oil producers.

      1. you wait for a Peak Oil thread BP? Wow, you MUST be busy.

        1. I’m working from Venezuela.

          Sorry, have to go. The toilet paper seller just found a few rolls. I have BOOZE! BOOZE!!!

    2. Look man, the unwashed masses aren’t just going to extinguish themselves. All of these schemes are power plays by the elite for another cleansing, or at least that’s what my tin foil hat keeps telling me. I think this because while the justification keeps changing, the goal always seems to be the same.

    3. Just suggest “peak welfare” and watch most of those schmucks deny such a thing.

  10. By the way, even though they usually like to lie and claim otherwise, the honest to goodness scientific truth is that even now in 2016, the petroleum geologists don’t truly know how the oil is formed, or even if it’s formed just one way or by a variety of different ways. It’s absolutely true that they’re experts in identifying and finding the places where the largest reserves are most likely to be sitting, but that’s not the same thing.

    If they would just stop pretending that they know a lot more than they really do, maybe they would stop making themselves look stupid by making these cockamamie predictions that always turn out to be completely wrong.

    1. Shh. People will tell you you’re crazy if you don’t agree to the dinosaur fat theory*.

      *I believe its actually lipid producing algae that are the new “drivers”, but the point is, if you suggest that there are non-biological processes that might produce medium and long chain hydrocarbons in large numbers people will ridicule you, even though they don’t know whether it is true or not.

    1. How dare you squirrels eat my damn post!

  11. I’ve met people who seem to think that if anything is in the Bible, it must be false. I don’t mean the stuff about turning water into wine and walking on water; I mean more basic stuff. They don’t believe there was a messianic movement in first century Judea, that anyone ever migrated from Egypt to Israel, or that John the Baptist ever existed–specifically because it’s in the Bible. They may even think Josephus a fraud–specifically because he confirmed something that happened in the Bible.

    There are so many people out there who treat economic thinking like that. If it’s economic thinking, in their minds, it must be wrong–specifically because it’s economic thinking. We often joke about how what progressives believe about how the economy works is dumber than creationism. Expanding on that, I think it’s probably easier to persuade Christians of the truth about evolution than it is to persuade some non-Christians about the truth of economic thought.

    Somehow, the Malthusians always seem to think that even though they were wrong about everything in the past, this time it’s different–and they’ve been falling into the same traps since forever.

    1. We often joke about how what progressives believe about how the economy works is dumber than creationism.

      I’ve come to think of progressives as economic creationists?

      1. Yep! From 11 years ago

        The Theory of Comparative Advantage is older than the Theory of Evolution. It has probably had more person-decades of theoretical pursuit and has not been refuted. The empirical evidence for it is overwhelming and increases every day.

        So why don’t we spend more time laughing at the 90% of the populace and the nearly 100% of Congress who don’t believe in it? Why don’t we laugh at those who think the God of the Government can be an Intelligent Protectionist?

  12. My understanding is that Darwin was reading both Malthus and Adam Smith on the Beagle and trying to reconcile the two. How can both of these things be true? He strolled down a beach on the Galapagos and saw two species of related birds that had differentiated themselves through specialization–so that they could both thrive on the limited resource of the beach–and bingo.

    Maybe that’s how we get to the willfully obtuse about economics. We can’t teach them economics if we call it economics like we can’t teach ethics to atheists if it comes from the Bible. So maybe we teach them about evolution instead. It’s all the same thing.

  13. “Jimmy Carter’s admonition to turn down the nation’s thermostats”

    Sexist!!

    1. We all know Carter was controlled by Big Sweater.

  14. Wake up!!!

    And do what? If we are at “peak oil”, then the price will go up as the supply dwindles and we’ll adapt. If we aren’t at “peak oil”, then there’s nothing to be “woken up” to.

  15. “*Oh, wait. The article quotes me. Despite that, reading the whole column is well worth your time.”

    I admit it Ron, I laughed. ^_^

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