Peak oil is wrong, says Peter Schwartz

1. Most of the remaining oil is owned by NATIONS -- i.e. S.A., Russia, Venezuala, etc. -- not companies on regulated stock exchanges. Nations may have motivation to exaggerate their reserves, and certainly have no-one to check up on them or levy consequences if they lie. So there may be some surprises ahead, and they may not go the way he suggests.

2. He does not mention the equally-important rise in *demand* for oil, as China, India, Brazil, etc. industrialize. Rising demand, more expensive supply = permanently more expensive oil, with demand kept in check by either recession or improved efficiency. Biofuels won't fill the gap much, most are inherently limited, and the others will take a while to grow into significant suppliers.

Anyone wanna buy Hummer?

He implies that peak oil advocates say that we're simply "running out of oil" and we don't understand that the oil we are going to be mining now (which we have a lot of) is going to be costlier. This is such a stupid, intentional misrepresentation of the position of many advocates of the peak oil concept it is simply infuriating.

Peak Oil has never been about supply (although quality of supply is a factor), it has always been about flow rate. Peak oil is about whether or not we can maintain the current, expected level of oil production at current costs and if not, what the ramifications for that are.

More expensive oil means that we're spending more of our GDP on energy which means a lower quality of life across the board. Someone has to suffer, likely a lot of people have to make major sacrifices. At $125 a barrel, we're spending 1/4 of our GDP on energy. If this Brazilian oil that he's talking about is that expensive or approaching that level of expense, is that something that we can maintain with our present economy? I don't think it's very likely and as a result many dependent sectors of the economy will suffer - like food production and manufacturing.

I just love how often we hear things like this pronouncement from Peter Schwartz, wherein someone dismisses peak oil, usually with the ridiculous "peak oil means no oil" canard, and then explicitly mentions how the cheap oil supplies can no longer meet our demand.

This is precisely what peak oil says! It DOES NOT say that we'll wake up one day to find that all of the oil is gone; it says that we'll exploit the cheapest reserves first, which only makes economic sense, and that eventually (but before we hit the peak) rising demand and the depletion of the cheapest, oldest fields will force us to mix in ever greater amounts of oil that is considerably more expensive and harder to produce in high volume. And that's exactly where we are today.

Does Mr. Schwartz realize that he contradicts himself in the first 30 seconds, and the rest of his remarks don't prove his assertion?

Did we really stop teaching logic in school before Mr. Schwartz's generation?

Mr. Schwartz is really arguing the date of Peak Oil is later than others suggest, not that it doesn't exist. He cites non-transparent reserve data, an argument that cuts both ways, and so does not help us determine the date. He cites technology, but admits it is costly, something that is part of careful Peak Oil problem statements (i.e. we will see in cheap oil soon). Finally, even technology plus additional reserves is not sufficient to disprove the peak oil hypothesis; he would need to show sufficient reserves and technology to continue increased exponential production of oil in the next decade; it is not clear that case can me made convincingly. It is a shame he did not try, as we might have learned something useful, instead being treated to a rant.

In summary, it is a shame that Mr. Schwartz did not present a better case against the appropriate peak oil problem statement, instead of setting up a false strawman to knock down.

Mr Schwartz is doing no one any favors with such arguments at this late date. One obvious hole in his argument against Peak Oil is his admission that future oil will be more costly, from harder to obtain reservoirs. Why? Because, as he very well knows, most if not all of the easily obtained oil has been discovered, produced and is now running out. As Prof. Aleklett and his students at the University of Uppsala have shown, it's the super-giant oil fields that contain by far the most oil on the planet, these were easily discovered over 40 years ago, and they are all now in production decline, hence Peak Oil is now, not in the future.

One would think an expert of Mr Schwartz's stature would educate himself better in these matters before adding confusion to the critical topic of Peak Oil for our government's leaders at this critical time. Sad to witness.

These are the statements that Peter made, amongst his rhetoric:

There will some day be a peak in oil.
There probably is a finite reservoir of oil on the planet.
There is a day when we will reach peak production.
We don't really know how much oil is in most of the oil reservoirs in the world.
Most of the data is in private or state government hands and they are not particularly forthcoming about how much is there.
The field production estimates are usually conservative, which results in them increasing once actual production happens and over some time of production.
Technology improves (EOR and deep offshore). It improves exploration and production capabilities of "more" oil.
What is gone, at the margin (key phrase), is cheap oil outside of the Middle East, Russia, etc.
Deep offshore is expensive. Deep underground is expensive. The marginal oil is going to be more costly.
The deep offshore off Brazil is more costly, but "it's big" (note he did not use the term "giant" or "super-giant").
Side note: This agrees with the CNN quote: responding to a question asking if offshore Brazil is the next Saudi Arabia, Rex Tillerson (CEO of Exxon/Mobil) said, "It's no doubt large, but to characterize it as the next Saudi Arabia mischaracterized the resource."
We are not going to run out of oil before the issue of climate change drives our change.
It'll be costly oil, but it's climate change and more expensive oil, not the fact that we're running out of oil, that will drive change.

None of his statements (as opposed to opinions) contradict the WEO 2008 report. In fact they support Peak Oil's major points. Why are we tapping "marginal", expensive oil? Because we have to -- the easy, cheap oil is running too low to satisfy demand.

We do know production profiles from depleted and existing fields. We do know that Ghawar is in decline (5.1 mb/d in 2007 vs. peak of 5.6 mb/d in 1980), in fact 17 of the top 20 producing fields worldwide are in decline (WEO 2008, pg 225). Numbers 9, 10, and 13 may not have peaked, but in 2007 they made up less than 9.5% of the top 20 field's total.

I agree with the WEO executive summary's opening statement:

"The world's energy system is at a crossroads. Current global trends in energy supply and consumption are patently unsustainable -- environmentally, economically, socially. But that can -- and must -- be altered; there's still time to change the road we're on. It is not an exaggeration to claim that the future of human prosperity depends on how successfully we tackle the two central energy challenges facing us today: securing the supply of reliable and affordable energy; and effecting a rapid transformation to a low-carbon, efficient and environmentally benign system of energy supply. What is needed is nothing short of an energy revolution."

waa waa waa, i cant wait for oil to become debilitatingly expensive, so you people stop blabbing on the internet and actually talk to someone in person.