Wednesday, August 26, 2009

The Peak-oil Conundrum

Theories abound regarding the imminent collapse of oil supply. The recent discovery of a massive quantity of oil lying under Brazilian waters is vindicating skeptics like Michael Lynch, an energy consultant formerly from MIT. He writes: "A careful examination of the facts shows that most arguments about peak oil are based on anecdotal information, vague references and ignorance of how the oil industry goes about finding fields and extracting petroleum".

He goes on to even suggest that, as fresh supplies emerge, oil will be so abundant that a new $30-a-barrel era is not as fanciful as conventional wisdom holds. This is nonetheless far from a case for downplaying the urgency for developing alternative sources of energy.

5 comments:

Anonymous said...

Drill baby, drill!

Anonymous said...

A note of warning concerning M C Lynch, former MIT economist. Has always denied any problems concerning oil and energy. Very prompt in pointing fingers at people who make incorrect forecasts, but rarely mentions when he gets it wrong himself. always predicts low oil prices and abundant supply. As far as is known ha has never anticipated last oil price increases of 2008 and never anticipated subsequent collapse. His mantra has always been and will always be that oil will remain abundant and cheap for the next 100 years!!! He has never been able to substantiate this claim.

He is exceedingly good at confusing the issues by never making the distinction between Original Oil in Place, Recoverable resources, and Reserves, neither makes he any difference between conventional or unconventional oil. Rates of extractions are unknown variables for him. If you want a more technical introduction to the above terms, see wikipedia.

Anonymous said...

The peak-oil theory is highly speculative as the world has yet to come to terms with its actual geological structure.

Rakesh

Anonymous said...

While I agree that we need to be cautious with the hype surrounding peak oil, I also believe that extraction costs in new zones will keep prices high, at least in the short term. So Mauritius must walk the talk in terms of energy diversification.

Smart and thought-provoking blog by the way!

Julian

Samad Ramoly said...

Update: 'giant' new oil discovery in the Gulf of Mexico.

http://news.bbc.co.uk/2/hi/business/8233504.stm