US Defence:Oil Almost Out


An interesting article online from a Californian environmental lawyer Nicholas C. Arguimbau is causing some controversy today - he says oil will almost be gone in 20 years with no planning on how the world will cope.

He quotes a report that says demand for oil will begin to outstrip supply in 2012, and will already be 10 million barrels per day above supply in only five years.

That’s not the view of some greeny climate change pressure group but a gloomy report this year from the United States Joint Forces Command. You can read it here

The report says:

By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD. To generate the energy required worldwide by the 2030s would require us to find an additional 1.4 MBD every year until then.

During the next twenty-five years, coal, oil, and natural gas will remain indispensable to meet energy requirements. The discovery rate for new petroleum and gas fields over the past two decades (with the possible exception of Brazil) provides little reason for optimism that future efforts will find major new fields.

And a report from the United States Department of Energy also seems to predict conventional oil will be almost all gone in 20 years, and there is nothing known to replace it.

Production of petroleum from existing conventional sources has been dropping at a rate slightly over 4% per year for at least a year and will continue to do so for the indefinite future.

The lawyer says that the graph implies that we are past the peak of production and that there are 750 billion barrels of conventional oil left (the areas under the “conventional” portion of the graph, extrapolated to the right as an exponentional).
Assuming that the remaining reserves  were 900 billion or more at the halfway point, then we are at least 150 billion barrels, or 5 years, past the midpoint.

The energy report says that total petroleum production from all presently known sources, conventional and unconventional, will remain “flat” at approximately 83 mbpd for the next two years and then will proceed to drop for the foreseeable future, at first slowly but by 4% per year after 2015.

If all this is true, just remind me again, why are more conventional cars, SUVs and more motorways to encourage car use the answer?




  1. Peter says:

    A realistic forecast. Clearly some countries are better prepared
    transport wise than others.

  2. Andu says:

    Madness. Our car and roads culture is going to come back to bite us in the ass so bad…..
    (I mean so much worse than it has already!)

  3. ingolfson says:

    Andu - at least it might happen early enough that Joyce & Co are shown up for the fools they are in insisting on roads roads roads. Cold comfort, but eh…

  4. Kurt says:

    I can just guess the cabinet discussions around this subject……..”I know lets build more motorways and encourage more trucks as well”
    Time for a forward thinking government not these dinosaurs!

  5. jarbury says:

    What a great time for us to spend $11 billion on state highways over the next decade.

  6. Jeremy Harris says:

    Two words:

    Ahhh Duuuuh…

  7. [...] As anyone who has ever done even the most basic study of economics would know, what happens when demand is greater than supply is that prices go up. This prices enough people out of the market to bring the level of demand back down to what is actually supplied – as you can’t exactly consume something which doesn’t exist. An interesting analysis of the possible effects of peak oil can be found here (Hat Tip, AKT). [...]


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