Demise of Peak Oil Theory
by David Deming
by David Deming: The
Peak Oil is
the theory that the production history of petroleum follows a symmetrical
bell-shaped curve. Once the curve peaks, decline is inevitable.
The theory is commonly invoked to justify the development of alternative
energy sources that are allegedly renewable and sustainable.
Peak Oil theory
was originated by American geologist M. King Hubbert. In 1956 Hubbert
predicted that US oil production would peak between 1965 and 1970.
When production peaked in 1970, it was interpreted as proof that
Hubbert's model was correct and that US oil production had entered
a period of inexorable and irreversible decline. Unanswered was
the question of whether or not US production had declined simply
because it had become cheaper to purchase imported oil.
Peak Oil is
a theory based upon assumptions. Like other scientific theories,
it is subject to empirical corroboration or falsification. Although
Hubbert correctly predicted the timing of peak US oil production,
several of his other predictions based on Peak Oil theory were wrong.
that the maximum possible US oil production by 2011 would be one
billion barrels. But actual production in 2011 was two billion barrels.
Hubbert predicted that annual world oil production would peak in
the year 2000 at 12.5 billion barrels. It didn't. World oil production
in 2011 was 26.5 billion barrels and continues to increase. Hubbert
was grossly wrong about natural gas production. In 1956 he predicted
that by 2010 US annual gas production would be 4 TCF. But in 2010,
US wells produced more than 26 TCF of gas.
The flaw of
Peak Oil theory is that it assumes the amount of a resource is a
static number determined solely by geological factors. But the size
of a exploitable resource also depends upon price and technology.
These factors are very difficult to predict.
The US oil
industry began in 1859 when Colonel Edwin Drake hired blacksmith
Billy Smith to drill a 69-foot-deep well. Subsequent technological
advances have opened up resources beyond the limits of our ancestors'
imaginations. We can drill offshore in water up to eight-thousand
feet deep. We have enhanced recovery techniques, horizontal drilling,
and four-dimensional seismic imaging. Oklahoma oilman Harold Hamm
is turning North Dakota into Saudi Arabia by utilizing hydraulic
fracturing technology. US oil production has reversed its forty-year
long decline. By the year 2020, it is anticipated that the US will
be the world's top oil producer.
For at least
a hundred years, people have repeatedly warned that the world is
running out of oil. In 1920, the US Geological Survey estimated
that the world contained only 60 billion barrels of recoverable
oil. But to date we have produced more than 1000 billion barrels
and currently have more than 1500 billion barrels in reserve. World
petroleum reserves are at an all-time high. The world is awash in
a glut of oil. Conventional oil resources are currently estimated
to be in the neighborhood of ten trillion barrels. The resource
base is growing faster than production can deplete it.
to conventional oil, the US has huge amounts of unconventional oil
resources that remain untouched. The western US alone has 2000 billion
barrels of oil in the form of oil shales. At a current consumption
rate of 7 billion barrels a year, that's a 286-year supply.
ago, I predicted that "the age of petroleum has only just begun."
I was right. The Peak Oil theorists, the malthusians, and the environmentalists
were all wrong. They have been proven wrong, over and over again,
for decades. A tabulation of every failed prediction of resource
exhaustion would fill a library.
is a chimera. No energy source has been, or ever will be, sustainable.
In the eleventh century, Europeans anticipated the industrial revolution
by transforming their society from dependence on human and animal
power to water power. In the eighteenth century, water power was
superseded by steam engines fired by burning wood. Coal replaced
wood, and oil and gas have now largely supplanted coal. In the far
distant future we will probably utilize some type of nuclear power.
But for at least the next hundred years, oil will remain our primary
energy source because it is abundant, inexpensive, and reliable.
the lifeblood of our industrial economy. The US economy will remain
stagnant and depressed until we begin to aggressively develop our
native energy resources. As Harold Hamm has said, "we can do this."
What's stopping us is not geology, but ignorance and bad public
Deming [send him mail] is
associate professor of arts and sciences at the University of Oklahoma.
His book, Black
& White: Politically Incorrect Essays on Politics, Culture,
Science, Religion, Energy and Environment, is available for
purchase on Amazon.com.
© 2012 by LewRockwell.com. Permission to reprint in whole or in
part is gladly granted, provided full credit is given.