Black Shoots on the Horizon

Not that anyone is looking for more bad news, but this article in the Independent Science News is most disturbing.

The world is heading for a catastrophic energy crunch that could cripple a global economic recovery because most of the major oil fields in the world have passed their peak production....

said Dr Fatih Birol, the chief economist at the respected International Energy Agency (IEA) in Paris, which is charged with the task of assessing future energy supplies by OECD countries.

Of course, this comes as no surprise to proponents of Peak Oil. Still, it is a most unwelcome analysis at this critical time.

In an interview with The Independent, Dr Birol said that the public and many governments appeared to be oblivious to the fact that the oil on which modern civilisation depends is running out far faster than previously predicted and that global production is likely to peak in about 10 years – at least a decade earlier than most governments had estimated.

But the first detailed assessment of more than 800 oil fields in the world, covering three quarters of global reserves, has found that most of the biggest fields have already peaked and that the rate of decline in oil production is now running at nearly twice the pace as calculated just two years ago. On top of this, there is a problem of chronic under-investment by oil-producing countries, a feature that is set to result in an "oil crunch" within the next five years which will jeopardise any hope of a recovery from the present global economic recession, he said.

{SNIP}

The IEA estimates that the decline in oil production in existing fields is now running at 6.7 per cent a year compared to the 3.7 per cent decline it had estimated in 2007, which it now acknowledges to be wrong.

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I doubt this is priced into the current stock market rally but it should make the new game of trading carbon credits quite popular in the Global Casino. Or, maybe they already knew that?

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hmmm

Since Exxon's profits dropped 66% plus hearings on the hill on oil/energy speculation and stopping certain hedge funds from engaging in futures trading....

are we sure on the facts of physical supply?

Perhaps some graphs on demand, imports, etc.on oil...I know global demand is down but haven't looked at those current statistics....

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hmmm...hmmm

What is it about oil that is so hard to understand? It is a completely renewable resource--there will be plenty more in a few million years.

I predict the article is right on track, and rather than a "decrease in global demand" what you are really saying is "decrease in the rate of increase of global demand".

Let us face the situation: we are going to hit this oil crunch at full speed. Our oil addiction, at this point, will have to be broken cold turkey. The withdrawls will be painful.

What we can do about it now is find ways to reward sustainability and long term thinking. We can do it.

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oil price increase - global economy can't handle it

This Financial Times article.

The world economy cannot sustain any further rise in the oil price, the International Energy Agency’s chief economist warned as oil prices rose toward a record high for the year.

Fatih Birol told the Financial Times that prices higher than about $70 could dampen a world economic recovery.

“If we go one step further, if we see prices go much higher than that, we may see it slow down and strangle economic recovery,” he said of oil prices on Friday, when the European benchmark was around $70.

European oil on Monday reached a high for the year of $73.75, spurred by manufacturing data from China and construction data from the US.

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2008 December

For me it's time to reconcile how we grok critical information. Lionel Bidal posted thoroughly June 23 at seekingAlpha, clearly revealing that in 2008 for the first time the IEA conducted for a detailed field-by-field analysis of global oil production.

15 December 2008 the Guardian's George Monbiot puts the question to Fatih Birol, chief economist of the International Energy Agency - and is both astonished and alarmed by the answer.

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