• 15 mins Iraq Wants To Build Gas Pipeline To Kuwait In Blow To Shell
  • 2 hours Trader Trafigura Raises Share Of Oil Purchases From State Firms
  • 4 hours German Energy Group Uniper Rejects $9B Finnish Takeover Bid
  • 5 hours Total Could Lose Big If It Pulls Out Of South Pars Deal
  • 7 hours Dakota Watchdog Warns It Could Revoke Keystone XL Approval
  • 1 day Oil Prices Rise After API Reports Major Crude Draw
  • 1 day Citgo President And 5 VPs Arrested On Embezzlement Charges
  • 1 day Gazprom Speaks Out Against OPEC Production Cut Extension
  • 1 day Statoil Looks To Lighter Oil To Boost Profitability
  • 1 day Oil Billionaire Becomes Wind Energy’s Top Influencer
  • 1 day Transneft Warns Urals Oil Quality Reaching Critical Levels
  • 1 day Whitefish Energy Suspends Work In Puerto Rico
  • 1 day U.S. Authorities Arrest Two On Major Energy Corruption Scheme
  • 2 days Thanksgiving Gas Prices At 3-Year High
  • 2 days Iraq’s Giant Majnoon Oilfield Attracts Attention Of Supermajors
  • 2 days South Iraq Oil Exports Close To Record High To Offset Kirkuk Drop
  • 2 days Iraqi Forces Find Mass Graves In Oil Wells Near Kirkuk
  • 2 days Chevron Joint Venture Signs $1.7B Oil, Gas Deal In Nigeria
  • 2 days Iraq Steps In To Offset Falling Venezuela Oil Production
  • 2 days ConocoPhillips Sets Price Ceiling For New Projects
  • 5 days Shell Oil Trading Head Steps Down After 29 Years
  • 5 days Higher Oil Prices Reduce North American Oil Bankruptcies
  • 5 days Statoil To Boost Exploration Drilling Offshore Norway In 2018
  • 5 days $1.6 Billion Canadian-US Hydropower Project Approved
  • 5 days Venezuela Officially In Default
  • 5 days Iran Prepares To Export LNG To Boost Trade Relations
  • 5 days Keystone Pipeline Leaks 5,000 Barrels Into Farmland
  • 6 days Saudi Oil Minister: Markets Will Not Rebalance By March
  • 6 days Obscure Dutch Firm Wins Venezuelan Oil Block As Debt Tensions Mount
  • 6 days Rosneft Announces Completion Of World’s Longest Well
  • 6 days Ecuador Won’t Ask Exemption From OPEC Oil Production Cuts
  • 6 days Norway’s $1 Trillion Wealth Fund Proposes To Ditch Oil Stocks
  • 6 days Ecuador Seeks To Clear Schlumberger Debt By End-November
  • 6 days Santos Admits It Rejected $7.2B Takeover Bid
  • 7 days U.S. Senate Panel Votes To Open Alaskan Refuge To Drilling
  • 7 days Africa’s Richest Woman Fired From Sonangol
  • 7 days Oil And Gas M&A Deal Appetite Highest Since 2013
  • 7 days Russian Hackers Target British Energy Industry
  • 7 days Venezuela Signs $3.15B Debt Restructuring Deal With Russia
  • 7 days DOJ: Protestors Interfering With Pipeline Construction Will Be Prosecuted

What is Peak Oil Theory? A Thorough Look at This heavily Debated Topic

What is Peak Oil Theory? A Thorough Look at This heavily Debated Topic

Currently there is a lot of debate going on regarding Peak Oil and precisely what we need to be doing about it, both now and in the near future.

The term "peak oil" refers to that specific point in time when the Earth's oil supply will finally reach that theoretical "maximum rate" of global petroleum extraction and will then signal the start of a progressive decline, where our thirst for oil will finally exceed our available supply of oil!

"Peak Oil Theory" is a concept originally derived from the measured postulates and predictions of M. King Hubbert, who in the year 1956, set out to scientifically formulate a method to prognosticate peak oil production within the United States between the years 1965 and 1970.

Vague interpretations and misunderstanding swept the media which led to people often confusing the concept of “Peak Oil” with the idea of “Oil Depletion!” The term “Peak Oil” actually refers to the point of “maximum production potential” of a particular oil well, oil field or through the use of deductive logic and some complicated mathematics, our world wide oil production as a planet.

Meanwhile, “Oil Depletion” refers to a progressively elongated period and process of slowly diminishing oil reserves and over time, the eventual cataclysmic collapse and utter exhaustion of the world’s oil supply.

The theory is based on the observed production rates of both individual oil wells, as well as that of conglomerate fields of oil wells. As technology increases the ability to drill oil quicker and more efficiently, the production of oil gleaned from each well continues to multiply exponentially, until the rate eventually peaks and then progressively declines, sometimes rapidly until the field or well is thoroughly depleted.

Supply shortfalls of oil then naturally lead to price inflation, which in turn lead to global energy shortages, extreme conservation measures and a panicked race to develop a wide variety of alternative energy sources, requiring significant changes in both lifestyle and technology in order to avoid world-wide crisis.

However, there is actually very little that is standard  and consistent within the science and accompanying mathematics utilized within Hubbert’s logistic model and as time rolled on, the theory grew in both complexity and fragility.

The greater the number of trained experts using Hubert’s theory to determine “Peak Oil,” the greater and wider the variances occurred in the predicted outcomes being forecast. So many unforeseeable and variable factors, such as weather, the economy, war, political upheaval and reliability of global cooperation had plugged into the formula; leading to as many dramatically different outcomes as there were scientists calculating the theory.

Now, as world wide conditions continue to change, day by day, hour by hour, so does the ability of Peak Oil Theory” to correctly foretell our future fortunes regarding available oil supplies around the globe.

One major occurrence that has quite dramatically altered much of the previously negative perspectives of many renowned energy experts is the recent discovery of some promising new, untapped oil reserves found in several locations all around the world.

So what exactly can we glean from our more comprehensive understanding of “Peak Oil” Theory?

First of all, we need to remember that “a theory” is just that, a mere postulate and nothing more! It is not a fact or a proven reality! It is a conceptual construct formulated from a collection of personal observations and speculations based upon the best data available but severely limited to ones capable depth and breadth of understanding and applying the information derived, in a manner that is both rational and logical.

Throughout history, the vast majority of “Peak Oil” predictions have proven time and time again to be incorrect, often substantially incorrect. As early as the 1950’s, several world class geologists began warning us about an eminent, devastating, world wide oil supply collapse that would bring technology and commerce to a screeching halt by the mid 1970’s.

Logic tells us that there very well could be some point in time, somewhere out there in our misty future, when oil supplies reach a critical peak and our need of oil begins to outweigh our supply of oil.

However, as previously discussed, with continually impressive technological innovations, we constantly get better and better at stretching our usage of oil so much further than we were able to do, even a decade ago.

This very same improved technology now allows us to find oil in places that we never could have guessed it might possibly have existed even 5 years ago. We can now drill 3 times further out in the great ocean depths than we were able to just a decade ago and have since developed robots that can easily withstand the pressure of deep sea diving and drilling that would quickly disable and kill a human being.

Written for OilPrice.com - the no.1 source for oil prices and crude oil information

 




Back to homepage


Leave a comment
  • Anonymous on January 16 2010 said:
    This author is completely wrong. My students are told to perfectly master the story of the peaking of oil in the United States if they want a passing grade, because the entire story about peaking is told in the history of oil in that country.I can also mention that the production of oil has peaked, or is peaking, in the Non-OPEC countries, which produce 60% of the world's crude. Thus, to talk about what improved technology is misleading, and I hope that our political masters do not get any strange ideas about what technology can do for us.
  • Anonymous on August 03 2010 said:
    The "peak oil" teory, misconsider the fact that new hydrocarbon are continuosly forming in the Earth's mantle, by carburation of Lithium, Calcium, Sodium and Potasium, and posterior hydrolization forming acetylen. Acetylen rose to the Earth's crust, and natural processes of polimerization, form more complex hydrocarbon chains. Thus, the oil supply never be finished. Cheers. Miguel
  • Anonymous on August 03 2010 said:
    The "peak oil" theory misconsider the fact that hydrocarbons are continuously forming in the Earth's mantle, by carburation of Lithium, Calcium, Sodium and Potasium. Posterior hydrolization forms acetylen. Acetylen rose to rocks of the Earth's crust, and processes of polimerization forms more complex chains of hydrocarbon. Thus, oil supply never will be finished. But the public knowledge of that, would attempt against the high price of oil! Cheers. MAG

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News