It really doesn't matter all that much whether the decline starts in two years or two decades. The fact that we've hit peak oil means that world wide economic growth is OVER for good. And given that the world wide population growth rate is currently about 75,000,000 people per year and food supplies are utterly dependent on hydrocarbon inputs, hitting peak oil means we are approaching an onrushing disaster.

Peak oil is irrelevant. When alarmists promote the fear of peak oil they cite data on conventional oil only. There is no legitimate reason to discount nonconventional oil since it is produced at costs well below the current market value of oil. There are several times as much estimated nonconventional oil as all conventional oil produced to date. The production of those resources could theoretically be ramped up to extreme volumes rendering the geologist comment above inane.

Venezuela's Orinoco field could theoretically supply global demand all by itself, it would only require infrastructure.

Sure, within a few centuries nonconventional oil MAY become scarce, but one must remember that the coal era didn't end because we ran out of coal. Doomism is actually a mental illness which Klare and his ilk take advantage of.

Klare's alarmist interpretation of this report is based on the citation that over the next 20 years non-conventional oil will increase from 4% to 13% of total consumption. Non-conventional oil includes offshore oil that costs under $20/barrel to produce. There's no crisis other than eventually people will catch on and stop buying Klare's books.

Plentiful reserves of offshore oil around the world are being explored and developed by Petrobras which has been investing tens of billions of dollars on these new projects over a time when oil prices struggled to stay above $30/barrel. Draw your own conclusion.

Until the commodity and asset price bubble in the spring of 08' caused leasing rates on rigs to briefly skyrocket, offshore oil has for decades been produced at a cost of $10 -$14 dollars per barrel. High sulfer oil costs a few dollars more to process and refine. It's not "easy" niether are most things. That never stopped anyone yet.

I used to think that Klare and the Doyens of peak oil were all motivated by a desire to redirect attention from wars for Israel. I still think that is correct for most of them, however I now suspect some of them have military industrial complex backing. The militarists have to keep people afraid and telling them that we can only have access to a dwindling resource through military aggression is just the ticket.

I agree there is a _lot_ of unconventional oil, but there is no way that its production could be ramped up at anywhere near the decline rate of conventional oil. And that completely sets aside such things as the environmental damage and the huge resources (water, natural gas) required to extract the stuff.

'mental illness'?? Hmmm, well M King Hubbert was laughed at - until 1970!

Ramping up the production of Venezuela's heavy oil is simply a matter of building refineries and producing pipes and ships. It just sits there right beneath the surface in a vast reserve waiting for market conditions to become reliably favorable.

As to Hubert's claim about the USA, it is only applicable in terms of economics rather than geology. Production abroad outcompeted domestic production due to falling shipping costs combined with their lower production costs. A prediction that auto production will peak in the US would be similar, Hubert was no doomer, he just stated the obvious.

There are a zillion graphs out there showing that non conventional oil will not cover our butts. The broad peak mentioned in the post looks like it was about 4 years in duration and we are at the beginning of the downward slope and it's steep. You can stick your head in the tar sands and say there is no problem but you are incorrect. Check out the dope here http://www.hubbertpeak.com/

Check out the graph on the Cantrell field and know that most new discoveries have a very short life.

Atheo, you're living in a fantasy world if you think tar sands and oil shale will save us. Or that somehow "market forces" will create new sources of energy. Geez.

"Ramping up the production of Venezuela's heavy oil is simply a matter of building refineries and producing pipes and ships. It just sits there right beneath the surface in a vast reserve waiting for market conditions to become reliably favorable."

There is some serious denial going on around here......or people just don't get it.

What price would make market conditions reliably favorable???? $250.00 a barrel? $300.00? I hope you make some serious money cause us regular folks will be screwed by the cost of EVERYTHING at those "reliably favorable" numbers. Wake up and smell the $12.00 dollar cup of coffee.

Wars for Israel? I won't disagree completely. But it is possible that Wars could be more for one reason. The energy industry is run by anglo-saxons and Israel does serve as a good watchdog in the middle east. So possibly they have had a common cause or does that take away from your pet cause?

Peak oil is hear and now. Which means that the financial system is over in it's current form. Oh, look here comes subprime...

Peak oil is a total scam. It was created to insure that the price per barrel is allowed to be put into a stranglehold by OPEC. That's why Saddam had to go and that's why Iran is next, control of THE PRICE PER BARREL. There's so much oil in the ground right now that humanity is in more danger of vaporizing itself and all other life along with it than it is of running out of oil.

"What price would make market conditions reliably favorable???? $250.00 a barrel? $300.00?"

This is one of the central deceptions of the doomers. In fact production cost of Venezuela's heavy oil is $25 - $30/barrel. Any more questions?

As for Israel "serving anglo saxons as a watch dog" please explain.

@Altheo & Mike

I suggest you both take a good look at Prof. Al Bartlett's video on the failure of the human species to understand the exponential function.

Mike says, "Peak oil is a total scam".

Because... why? That oil is a renewable resource and more is being created all the time?

Or does Mike just mean that there is going to be a peak, but not not soon? That talk of the peak is exaggerated so that those who own oil will make more money?

Probably Mike means the latter. So if those who own the oil hate America and won't pump their oil out of greed and spite, the recourse of America is what? Figure out how to do with less?

Or borrow more money from China and take over a country with some oil and liberate that oil.

Or maybe the elite of our country are hiding oil here in America? In that case, the more economical and moral position would be to just kill the local profiteers and not travel clear around the world to do the same thing.

For me, still trying to figure out what the facts are... Thanks for the input in the original post.

As for Israel "serving anglo saxons as a watch dog" please explain

It has been a mutually beneficial arrangement since Israel's inception. It will not last forever. The anglo elite will drop them like bad habit when the shit hits the fan and they will serve as likely scapegoats after the currency collapses, which should be arriving in the fall. The zionist elite may not even care. The first victim of peak oil will be the monetary system. No increasing energy, production did stall in 2005, no ability to pay back the massive debts. The global economy is 100% dependent on energy and the monetary system is 100% dependent on increasing energy. The elite know this, at least some.

Wells, regions and countries all peak and decline. This is an observable fact. It's not a theory. It is an observation and it appears the world is peaking now. Because of the low price per barrel investment in exploration has collapsed. This will make the declines even steeper. New world coming...

This is one of the central deceptions of the doomers. In fact production cost of Venezuela's heavy oil is $25 - $30/barrel. Any more questions?


Yeah... You’re going to have to drill in hostile areas. Your going to have to run new pipe setup for heavy crude and then maintain it. Your going to have to revamp the refineries for heavy crude and so on. Just how is it going to $25 - 30 a barrel again when the cost expenditure is going to be enormous? Do you think the oil companies will not pass the cost on to the consumer?

Anonymous - June 16, 2009 2:51 AM,

You still offer no "benefit" from Israel to the anglo-americans. What has Israel done for America?

The Iraqis and Iranians have been more than willing to produce and sell their oil under terms no diferent to those offered globally, in fact it is the US under ziolobby pressure that has imposed trade and financial sanctions on them.

Finally I re-iterate, the cost to produce Venezuela's heavy oil is $30/barrel. Don't expect oil to trade beneath that figure for very long.

These are all critical pieces of information for understanding what goes on in the world.

It's not just about how much oil you can extract it's about return on invetment. It is unfair to compare a mining operation (tar sands) with a return or 1 to 2 to the kind of oil we have been used to.

So what?

Some oil fields produce at $2/barrel, some at $22, what exactly is the crisis?

well that is just the cost of extraction there is also transport refinement as well as shipping costs that get piled ontop of that that drive up the cost per barrel.