Update on Peak Oil

[Lord Beria3]

https://www.financialsense.com/perfect-energy-storm

The FS team do a great podcast on why peak oil never went away and the dynamics within the global oil market.

They cover the alleged "peak demand" story, the massive rise of US shale oil and the unreported fact that depletion rates are now 6%.

Summary: a major supply crunch is looming in 2/3 years (even if there is a recession next year which is considered likely).

[Lord Beria3]

Update on peak oil and the wider global economy...

http://www.postcarbon.org/the-end-of-gr ... ars-later/

Update on shale oil and tight oil...

http://www.postcarbon.org/the-problem-w ... forecasts/

[johnhemming2]

This is always a useful tool for looking back
https://www.iea.org/oilmarketreport/omrpublic/

What happened just over 10 years ago was the conventional peak which was accompanied with a price spike and continual removals from stocks.

This could have started in early 2017, but I think it is too soon to tell.

I think it is extractors limits rather than geological limits that are key at the moment.

[vtsnowedin]

I think it is extractors limits rather than geological limits that are key at the moment.

Was that not always the case and prediction?

[johnhemming2]

In the period 2005-10 I think the geological limits were most important in the sense of a peaking of conventional oil.

In terms of this history of carbon based fuels (starting with wood and charcoal) we have moved into an era where the sources are harder to obtain rather than more convenient.

[vtsnowedin]

In the period 2005-10 I think the geological limits were most important in the sense of a peaking of conventional oil.

In terms of this history of carbon based fuels (starting with wood and charcoal) we have moved into an era where the sources are harder to obtain rather than more convenient.

I would place that point near 1980 and the development of the North sea oil fields and deep water exploration.

[johnhemming2]

In the period 2005-10 I think the geological limits were most important in the sense of a peaking of conventional oil.

In terms of this history of carbon based fuels (starting with wood and charcoal) we have moved into an era where the sources are harder to obtain rather than more convenient.

I would place that point near 1980 and the development of the North sea oil fields and deep water exploration.

It is true that the events of the 70s speeded up going for the North Sea and Deep Water.

However, I think the main cause now is geology rather the politics.

[raspberry-blower]

Someone else has shouted out Peak Oil:

Energy Skeptic: IEA World Energy Outlook 2018: Peak Oil is here, crunch by 2023

[emordnilap]

Someone else has shouted out Peak Oil:

Energy Skeptic: IEA World Energy Outlook 2018: Peak Oil is here, crunch by 2023

It absolutely has to happen, we’re all aware of that. Whether you can be accurate to a year is suspect - not everyone accepts that things will “crash�, it’s just a continuation of deterioration for most people.

Whatever, there’ll be some fun.

[raspberry-blower]

It absolutely has to happen, we’re all aware of that. Whether you can be accurate to a year is suspect - not everyone accepts that things will “crash�, it’s just a continuation of deterioration for most people.

Whatever, there’ll be some fun.

In that article Alice Friedmann nails it:

Enjoy your life for the next few years, beyond that there’s no guarantees. Some regions will fare better than others though

[kenneal - lagger]

Almost as important as "Peak Oil" is the Energy Return On Energy Invested of the new oil products which we are now using. That has been reducing for quite a few years now and some believe it is the driver behind the crashing of the world economy. Add actual Peak Oil to the drop in EROEI and we could see a series of drastic crashes with not much improvement between.

[adam2]

Also, oil production PER CAPITA is arguably at least as important as the total in absolute terms.
Per capita oil production peaked many years ago, no way is oil production ever going to catch up with population growth.

[raspberry-blower]

Almost as important as "Peak Oil" is the Energy Return On Energy Invested of the new oil products which we are now using. That has been reducing for quite a few years now and some believe it is the driver behind the crashing of the world economy. Add actual Peak Oil to the drop in EROEI and we could see a series of drastic crashes with not much improvement between.

Over at Surplus Energy Economics Dr Tim Morgan refers to Energy Cost of Energy and then ties it in with prosperity rather than GDP.
From his latest blog, we get him explaining thus:

As regular readers will know, the narrative of recent years is that prosperity has been coming under increasing pressure ever since the late 1990s, mainly because trend ECoE (the energy cost of energy) has been rising, squeezing the surplus energy which is the source of all economic output and prosperity.

This is a trend which the authorities haven’t understood, recognizing only a vague “secular stagnation� whose actual root causes elude them.

One thing that has been rather overlooked in all this is that interest rates are still at extraordinarily low levels, more than a decade after the financial crash of 2008. If the economy was doing that well shouldn't we have seen far more in the way of interest rate rises?

Putting this all into context then:
"Unconventional" oil extraction such as Tar Sands and fracking are not only environmentally catastrophic they also have a lower EROEI than most, if not all other forms of oil extraction.

Because of low interest rates these unconventional oil producers have been able to summon ever more amounts of debt just to keep the plates spinning, so to speak.

Yet this is all a façade - there are signs that "investors" have had enough and are threatening to pull the plug. They want a return on their capital and are yet to see anything tangible. If this does come to pass and that frackers find that their Capex becomes limited then the notorious decline rates will soon become apparent.

The next leg down is going to be more severe

[vtsnowedin]

Interesting that mister Morgan considers only the "excess energy" as" producing economic output and prosperity". Does not the energy industry produce economic output and become prosperous doing it?

[raspberry-blower]

Interesting that mister Morgan considers only the "excess energy" as" producing economic output and prosperity". Does not the energy industry produce economic output and become prosperous doing it?

I think you are missing the point here, VT.
The energy industry is an integral part of the infrastructure, not a separate or stand alone entity.
After all, it is the work that is derived from this energy that is a driver of economic activity. The Surplus part is when the amount of energy extracted exceeds the amount of energy sunk in for extraction.
The energy companies have gotten very prosperous on the back of this.
When more energy is required for extraction then, ergo, there is less available energy for work. Yes, there are efficiencies that may help, however there is a limit to this.
Put into economic context, growth has been extremely anaemic with far more DEBT required - this is highly unlikely to ever be repaid
Which will then pose a huge problem for the Western fiat currencies as belief in them ebbs away.
No doubt the big energy companies will find a way of getting through this though - they always do