Previous Attempts to Alert Us to the Coming Crisis

The latest predictions of a global oil supply crunch coming somewhere between 2015 and 2020 are in keeping with previous expert findings dating back to 2004 and largely ignored by policy makers. It is unfortunate that it took a massive blowout in the Gulf of Mexico to make people aware that we might have a problem.


The disparity between increasing production and declining reserves can have only one outcome: a practical supply limit will be reached and future supply to meet conventional oil demand will not be available. The question is when peak production will occur and what will be its ramifications. Whether the peak occurs sooner or later is a matter of relative urgency.... In spite of projections for growth of non-OPEC supply, it appears that non-OPEC and non-Former Soviet Union countries have peaked and are currently declining. The production cycle of countries... and the cumulative quantities produced reasonably follow Hubbert’s model [which successfully predicted the peak of U.S. lower-48 production more than 10 years ahead of the event].... The Nation must start now to respond to peaking global oil production to offset adverse economic and national security impacts.

Strategic Significance of America’s Shale Oil Resource. Vol. 1, Assessment of Strategic Issues. Office of Deputy Assistant Secretary for Petroleum Reserves, Office of Naval Petroleum and Oil Shale Reserves, U.S. Department of Energy, March 2004


[W]hen discoveries of new reserves fall short of demand—which may be the case in just a few years for oil, and slightly later for natural gas—energy prices will climb significantly. The supply situation is being made more acute by the growing hunger for energy in China and India.... The end-of-fossil-hydrocarbons scenario is not therefore a doom-and-gloom picture painted by pessimistic end-of-the-world prophets, but a view of scarcity in the coming years and decades that must be taken seriously. Forward-looking politicians, company chiefs and economists should prepare for this in good time, to effect the necessary transitions as smoothly as possible.

Energy Prospects After the Petroleum Age. Deutsche Bank, December 2004


The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking.

Peaking of World Oil Production: Impacts, Mitigation, and Risk Management. Report of Science Applications International Corporation (SAIC) to the U.S. Department of Energy, February 2005


The doubling of oil prices from 2003-2005 is not an anomaly, but a picture of the future. Oil production is approaching its peak; low growth in availability can be expected for the next 5 to 10 years. As worldwide petroleum production peaks, geopolitics and market economics will cause even more significant price increases and security risks. One can only speculate at the outcome from this scenario as world petroleum production declines. The disruption of world oil markets may also affect world natural gas markets since most of the natural gas reserves are collocated with the oil reserves.... The days of inexpensive, convenient, abundant energy sources are quickly drawing to a close.... World oil production is at or near its peak and current world demand exceeds the supply.

Energy Trends and Their Implications for U.S. Army Installations. U.S. Army Corps of Engineers, September 2005


Raising [oil] production is a real challenge... if we stay with this type of production growth our impression is that peak production could be reached around 2020.

Thierry Desmarest, CEO of TOTAL S.A., world’s fourth-largest publicly traded oil and gas company. Speech to the World Gas Conference, Amsterdam, 7 June 2006


[W]hile some of the more pessimistic oil specialists are declaring that peak oil has already been passed, or at best is here now, others believe it is not going to arrive before 2010. Some optimists give the world a little more breathing space—that is to say up to 2020, and perhaps even up to 2030. However, all in all, most would appear to agree that peak oil output is not very far away for all of us. It could take place sometime within the next decade or so, which in fact means that there is not much time left for a world economy to be driven largely by oil.... Furthermore, under any of these scenarios, and since peak oil output is not about the time at which oil will run out, but the time at which production can no longer be increased to cope with increased demand, it seems the only way the oil price can go is up.... [W]e are at, or near, the production peak of world oil, if not on the downward slope....

Dr Shokri Ghanem, director of research at OPEC. Speech on the occasion of receiving the 2006 Petroleum Executive of the Year Award, 19 September 2006. Published in OPEC Bulletin


CRUDE OIL: Uncertainty about Future Oil Supply Makes It Important to Develop a Strategy for Addressing a Peak and Decline in Oil Production

Title of report from the U.S. Government Accountability Office to the U.S. Congress, February 2007


I expect to see a peak sometime before 2015, but I don’t think we’ll see a simple maximum followed by a decline. I foresee a series of maxima, each followed by a brief decline. The simplest analogue would be a sine wave. It may be some time after the true peak before we can recognize it as such.

Jeremy Gilbert, retired Chief Petroleum Engineer for British Petroleum (BP). Interview with ASPO-USA, 7 May 2007


The oil boom is over and will not return. All of us must get used to a different lifestyle.

King Abdullah of Saudi Arabia. Address to his subjects, August 2007


We are experiencing a step-change in the growth rate of energy demand due to population growth and economic development, and Shell estimates that after 2015 supplies of easy-to-access oil and gas will no longer keep up with demand.

Jeroen van der Veer, CEO of Shell Oil. Memo to all Shell employees, 22 January 2008


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