Denial is futile.

Oil, NG and Coal will all run out before the end of this century.

Alternative liquid fuels, sun and wind energy (and more nuclear) will progressively replace fossil fuels.

The world will adapt and be better off for it.

Anne: "It seems it is more the first reason, as oil production exceeded demand up until 1981. From that year on, it is the reverse."

So how could demand exceed production for 27 years, and only in the last 5 have there been an increase in price, and the last one with a mega-increase?

Surely the speculators are not that clueless?

"B.t.w. this week I saw some Iraqi oil ministry bigwig (perhaps the minister himself, I didn't pay attention to that) declare that oil is produced at a higher rate than the market can absorb, and that there is no shortage and that current oil prices are caused by speculation. Does this data prove him wrong?"

Or does the Iraqi Oil Ministry prove BP wrong?

Another theory is that BP is just cooking the numbers to make the high prices they are getting look "reasonable" to the public. Feed the PeakOilers with the doom they so desperately crave; milk them all for every last penny they have. BP gets hyper-rich, and their customers are happy as hell. Win-win!

@anon:

Another theory is that BP is just cooking the numbers [...] Feed the PeakOilers with the doom they so desperately crave

Then BP must have been doing this since 1981. Where were your 'PeakOilers' in 1981? Seems an inplausible theory to me.

@Kit P:

all he needs is congress to change some laws so he can build a transmission lines to get the electricity from where the wind is to where the demand is.

It is stupidly such as this that is the reason fossil fuels are use is growing so fast.

Is my interpretation correct that you suggest it is stupid to transport power from where it is available to where the demand is?

With regard to Peak Oil, it doesn't matter what your opinion is whether it will happen, or when it will happen.
What matters is how much it will cost to buy a gallon of gas.
Even if there is plenty of oil out there, if the people have to decide between buying gas and buying food, that is a paradigm shift, and we need to focus on alternatives.

Solar is coming down in price quickly, and should be comparable in price to grid electricity in four years, according to one Solar Cell Company I talked to. Wind is also a strong candidate.

Hydroelectricity is already suffering in the west due to reduced rainfall and environmental concerns on the coast due to impacts on fish populations.

In the US, coal and nuclear power plants are also starting to be more difficult to put into production, and natural gas prices are leaving few options for electricity generators but to raise electricity rates.

You don't have to pick your favorite energy source and run with it. The market will decide the winners, and right now Oil, Coal and natural gas are losing favor... just look at the annual % increase in market share.

The transportation market is being forced into providing electricity or electric assisted cars (even fuel cells will require large amounts of electricity to make the hydrogen until other sources are more plentiful and cost effective).

My bet is on a strong but gradual shift to electricity generation for most of the energy needs in the US for the foreseeable future, whether it is wind, solar, or otherwise. There is simply not enough Gas, Oil or Coal in the world at an affordable price (including environmental cost) that can supply the world's future energy needs.

With regard to Peak Oil, it doesn't matter what your opinion is whether it will happen, or when it will happen.
What matters is how much it will cost to buy a gallon of gas.
Even if there is plenty of oil out there, if the people have to decide between buying gas and buying food, that is a paradigm shift, and we need to focus on alternatives.

Solar is coming down in price quickly, and should be comparable in price to grid electricity in four years, according to one Solar Cell Company I talked to. Wind is also a strong candidate.

Hydroelectricity is already suffering in the west due to reduced rainfall and environmental concerns on the coast due to impacts on fish populations.

In the US, coal and nuclear power plants are also starting to be more difficult to put into production, and natural gas prices are leaving few options for electricity generators but to raise electricity rates.

You don't have to pick your favorite energy source and run with it. The market will decide the winners, and right now Oil, Coal and natural gas are losing favor... just look at the annual % increase in market share.

The transportation market is being forced into providing electricity or electric assisted cars (even fuel cells will require large amounts of electricity to make the hydrogen until other sources are more plentiful and cost effective).

My bet is on a strong but gradual shift to electricity generation for most of the energy needs in the US for the foreseeable future, whether it is wind, solar, or otherwise. There is simply not enough Gas, Oil or Coal in the world at an affordable price (including environmental cost) that can supply the world's future energy needs.

I am afraid you don't understand "peal oil" correctly

you say : peak oil is true only if "thechnology remains constant and new reserves are untapped"

That is absolutely wrong.

Look at the curve of oil production in US it has been steadily decreasing during 40 years, despite :
- alaska being tapped after the peak in 1971
- technology being constantly improved (EOR etc.., average recovery increse from 25 to 32% between 70 and today, still production is declining)

Please do you reserach before asserting things that are not supported by facts,

you have to understand that once the bulk of the production has peaked you can not offset the peak by improving the technology of extraction or by adding secondary untapped field, it only slows down the decrease, and this is perfectly described by peak oil theory. The very last of peak oil is that we will rather have a plateau of production rather than a sharp peak.

@ Kit P

Effective renewable energy means a smart regional, or even better, national smart grid. State and local power regulation must make way for regional or national power transmission regulation.

Just like the interstate highway system preempted local and state roads to make our trucking industry possible, so to will a nationwide electric power grid make a secure, reliable, and efficient power distribution system possible.

Furthermore, just like the interstate petroleum and gas pipeline system makes current fossil fuel energy distribution possible so to the smart grid.

Just like eminent domain was used for the highway system, it should be used for the national smart electric grid.

Pickens must be getting senile

No, Pickens is one of the smartest energy entrepreneurs around and he is backing a winner. His success in the business bears witness to his smarts.

The rule of law in the US will not be abandoned…

Conflicting and self-serving local and state electrical power transmission regulation must make way for consistent and coherent regional electrical power regulation.

For some unknown reasons think that due process goes away just because someone claims they a being altruistic.

Due process is defined or modified by the congress. If oil men bend congress to their benefit why can’t environmental friendly wind men do it too.

Kit P I don’t understand why you are against American energy progress. Is it just the sight of the wind mill on the land that annoys you? And you like the sight of coal fired generation plants and the strip mines that you like so much better?

This question is beyond me.

The KitP troll has certainly stirred the pot today.

We see oil use going up faster than oil production. This is because old oil fields are decreasing production faster than new ones can be found and tapped. The easy oil is gone, and the more difficult to get oil is our best supply. If this isn't "peak oil" then just what is it? (It really is peak oil no matter what a few oil shills claim).
Oil will continue to increase in cost.

Wind energy is now cost competitive with oil, and decreasing in cost. Other renewable energy sources are also becoming competitive.

The switch in power generation to wind and renewable energy is rather obvious for the end user, but also obviously seriously discouraged by Oil interests who stand to make huge profits from rising oil prices.

Renewable energy is only 1% to 2% of world energy, but growing fast. If the same exponential rate of growth is continued, then in 20 years renewable sources will be producing as much energy as the world consumes now.
It is probable that their growth rate will actually be far quicker.

As for Kit P claiming that T Boon Pickens will not get transmission lines ... he already has got a power transmission route from his wind farm into Dallas, and plans to transport water as well as power. Oil shills say anything to promote an oil reliance without checking their facts.

That is absolutely wrong.

OK, let me try a different way to help you see the folly of the peak oilers.

If you accept the figures here, the United States currently produces a bit less than five million barrels/day of oil out of its 21 billion barrels of proved reserves.

The estimates are that there is five times this amount of recoverable oil in the offshore areas that are currently prohibited to oil exploration. Do you believe that it is somehow impossible, at $140/bbl, to produce at least as much oil as we are producing today from five times the reserve base?

@Anne

The stupidity is ordering wind turbines before you have the transmission lines to send the electricity to market. The need for improving our transmission system has been know for years. It is a collision between common sense and the legal system.

Project development takes years of quite ground work. Pickens testifying before congress is just so much grandstanding. The main point is that we can not develop renewable energy projects fast enough. This does not mean we should not build them as fast as we can, just that Picken will fail unless his goal is to buy manufacturing capacity and resell it.

@ Axil

I did not make the rules. However, I do agree with much of what you stated. If you check the 2005 Energy Bill you will find much of your shopping list has been accomplished.

I am certainly for progress, maybe just not your version. Go ahead and declare solar panels and wind mills environmental friendly. If you try to put those things in the wrong place, you will be spending lots of time in court. Folks like Axil somehow think the right place is somewhere else.

Growing trees on a reclaimed strip mine sure is a much better environmental choice than putting wind turbines there.

Speaking of large OPEC countries, Iran has been leasing supertankers to store their heavy and sour crude production instead of releasing it onto the market. This also takes tankers out of circulation. Venezuela is reportedly doing something similar. Apparently, refineries that are have equipment to handle heavy and sour crude are maxed out. Any shipments will go into storage or worse, sit onboard ships at port. So they withhold tens of millions of barrels of oil and tanker capacity to store it to prop up the price of heavier grades of crude.

For those who don't believe in “peak oil” I suggest some remedial homework. Please begin with ...
http://www.fossil.energy.gov/programs/reserves/npr/publications/npr_strategic_significancev1.pdf

See figure 7 showing the USA peaking oil production in mid 70's and the world peak being reached just after 2000, a situation I was not expecting till about 2012.

Note that the study presented is done by the oil industry which is why their proposed solution is to exploit tar sands and cause huge pollution in the American and Canadian West, but fails to even consider renewable resources.

Peak oil is real, and is now. pretending we will ever be able to ramp up production to fully meet world demand again is unrealistic. Our energy supples should be turned to other sources if we expect a future with available power.

Matthew,

You still don't get it. Peak Oil does not say to ignore the oil off our shores (or similar amounts in oil shale in the Rockies). It just says that the cost of extraction keeps rising, just as you say, and the rate of extraction does not keep up with population growth and growth in per-capita consumption.

So go ahead and open up our offshore fields. (of course, you're also ignoring the millions and millions of square miles that have been leased off the US, are fully exploitable and never have been explored because XOM, Chevron, etc. don't want to invest the risk capital).

You're right, now that oil is $140/BBL someone ought to be opening them both the pre-leased territories and the new territories. But it doesn't change the trend. Too many cars, too many people, and the supply of cheap, easy oil is declining. And Peak Oil explains that quite well.

Actually, more renewable energy than nuclear energy is generated:
http://www.ren21.net/pdf/RE2007_Global_Status_Report.pdf

Wind, Geothermal, Ethanol, Biodiesel, Wood and Solar Hot Water is ignored in the BP report.

Matthew

you have been burning up the keyboard on this one. I'd like to add a few more facts. World oil discoveries peaked in the 1960's and have been declining ever since. World production is reliant on production from a few super giant fields and some of these are entering rapid decline, such as Mexico's Cantarell field.

You can keep saying that there are massive fields to be discovered till you're blue in the face but that doesn't make it correct. Oil formation is dependent on very specific geological conditions and pretty much all the most prospective regions in the world have already been thoroughly explored. Economics might drive exploration but it can't change geology.

The reserves figures quoted by BP are a best guess. Many OPEC countries don't allow an external audit of their reserves and have a vested interest in making them higher so they can pump more oil. Kuwait have been caught out overstating their reserves in the past.

Is the CEO of Chevron wrong when he says that the "era of easy oil is over"? Other oil execs have come out with similar comments. It seems that many Americans find it difficult to cope with the concept of peak oil. It must be because it is a threat to the happy motoring wonderland 'enjoyed' for the last fifty years.

Where exactly is the millions and millions, I think I heard 69 million from a Senator yesterday. I keep hearing this quote, anyone got a map they can point it out. Not that I can't believe it, I'm just haveing a hard time buying EOM or Chevron not taking advantage of what they have. Yes the oil companies are making an outragous amount of money right now. However, $4 gas is not in thier best interest, even the Saudi's picked up on that fact.

Kit P and Axil,

Boone Pickens is not the only one to have a problem delivering energy from generating point to demand.

The bipartisan doofi in charge in California, including the Governator, had a lot of renewbles built in the desert; and then failed in getting the transmissions lines built or even auhtorized, to bring teh power out to coastal cities like LA and San Diego. And these doofi possess Emminent Domain power. proving that...

Stupidity is where you find it.

It is amazing how little mathematics the true believers understand. If I use 100 units of coal and increase by 3.3% per year, then next year my base will be 103.3 units of coal.

If I make 0.5% units of solar/wind and increase by 33% per year, I will have 0.665% after a year.

So the coal grows by 3.3 units; the "fast growing" renewables increase 0.165 units.

I lose ground in absolute terms. I am growing faster, and even may be "closing the gap" but its not fast in closing.

"In the long run we'll all be dead".

@Kit P

If you try to put those things in the wrong place, you will be spending lots of time in court. Folks like Axil somehow think the right place is somewhere else.

Wind mills and solar are built on any land with the owner’s permission, predominantly with the owners permission using a sue proof legally air tight lease agreement. There is absolutely no time spent in court after that agreement.

The land owner gets a payment based on the productivity of the wind mill.

If you drive through the country side and see these wind mills and don’t like what you see then that’s too bad. You cannot sue the land owner. He can do what he wants with his own land. I am sorry for you in that respect. Poor Kit P doesn’t like the view.

Electrical transmission lines are another story. There, eminent domain comes into play. Obstructionists may use the courts to block the improvement of the grid. I think that is un-American. Is that what you want to do to slow down the mills like many have done to slow down the nukes?

If you check the 2005 Energy Bill you will find much of your shopping list has been accomplished.

I don’t think that the 2005 Energy Bill was effective in fostering the development of a national smart grid.

Go ahead and declare solar panels and wind mills environmental friendly

I do. If you don’t; I would be interested in that argument.

Growing trees on a reclaimed strip mine sure is a much better environmental choice than putting wind turbines there.

I agree with you here. Reclaimed strip mines are usually flat. The best place to put a wind mill is on a ridge.

@Axil,

I am not against renewable energy, just idiots. One of the root causes of failure of renewable energy projects is that the US educates too many lawyers and not enough engineers. Yes, wind mills can be erected on private property if you follow all the regulations and can afford the attorney fees to prove it.

I have no trouble listing the environmental benefits of the shade trees around my house. I can also list the numerous environmental benefits of anaerobic digesters processing dairy farm manure in a semi climate. However, I defy Axil or anyone else for that matter to list one way in which they are environmentally friendly. Do wind mills provide habitat for endangered species? Do wind mills or solar panels make the air cleaner by some kind of magical air filtration property?

The only benefit of wind and solar is that every MWe produced offsets a MWe of electricity made with imported LNG. That is very good economically for the US. I would rather pay US workers to build and maintain renewable energy projects than back roll some banana republic dictator with no regard for human rights.

Axil is correct that 2005 Energy Bill did not create a national grid. It was intended to make it easier to build transmission lines and enforce grid reliability standards. Time will tell if court challenges are rejected. However, anything a new law enacts will face the same lengthy legal battle.

@stan s Peterson

T. Boone Pickens is the St. Thomas Aquinas of the Gaian nouveaux religion. He gravely sinned in his youth as an oil man, but converted in later life to wind power. This is why the environmentalists respect his pronouncements so highly, in fact, considering them as church doctrine.

Having said that, we are all excited to hear this prophesy: he expects that 20% of all national electrical generation can be produced by renewables by 2018 instead of 2030 if the smart grid is there to support it.

Halleluiah, halleluiah to God on high, let his will be done. Let not the demon stand against our God (-:

Stan will you stand against T. Boone Pickens?

Is the CEO of Chevron wrong when he says that the "era of easy oil is over"? Other oil execs have come out with similar comments. It seems that many Americans find it difficult to cope with the concept of peak oil.

Sure, easy oil is over. Now it's going to be harder...so? It means nothing. Peak oil as an eventuality is possible albeit improbable, but it certainly isn't happening now.

Seems peak oil is a lot like global warming, in that no amount of reason or logic can convince the true believers that it just ain't so. Even when oil production continues to rise over the next few years people will continue to insist "peak oil is here!", just like people continue to insist that global warming is here even as the long-predicted cooling starts to take hold.

@ KitP, Anne, Mathew, et al

Whether or not technology can reduce the cost of hard-to-tap-and-refine oil faster than demand for it will grow is an open question. We need not answer the are-we-at-peak-oil question to evaluate BP's report, anyway.

Whether or not renewable energy production can grow in absolute terms faster than non-renewable energy may also be an open question, but there are several large trends at work that suggest renewable energy will overtake nonrenewable, and eventually suppress nonrenewalble production.
1. China is building 80+ gigawatts of hydroelectric (lots of elevation drop from Himalayas) (see http://en.wikipedia.org/wiki/Hydroelectric). Sure it's vulnerable to earthquakes...and refineries are vulnerable to hurricanes. They need it. They will do it.

2. The price of solar thermal, photovoltaic, and wind are all coming down. The cost of fossil fuels are going up.

3. While there are many renewable energy schemes that will surely fail, this is not proof that renewable energy as a class will not scale. It is actually healthy that so many avenues are being explored that we can predict the majority will not bear fruit. This broad innovation and shake out process increases the likelihood of one or several approaches becoming a huge success.

4. While it is challenging for an immature industry such as photovoltaic of solar thermal to be more cost-effective than a mature industry such as coal-electric or gasoline, the potential financial rewards of providing a scalable renewable alternative have risen so much that the deep pockets needed to persevere and leapfrog today's low-cost energy providers have finally arrived.

5. The support infrastructure to carry electricity from point of production (the Mojave) to point of consumption (everywhere else) will come. We built an 800-mile oil pipeline across Alaska. A few billion dollars worth of high voltage wires is just table stakes, compared to the Trillions of dollars that can charged for the power.