Daniel Yergin on peak oil

by Milan on October 22, 2011

in Climate change, Economics

Many journalists and energy analysts speak of ‘peak oil‘ as an inevitability. This is the idea that world oil output will peak soon and decline sharply thereafter, pushing prices up substantially.

Daniel Yergin’s book The Quest: Energy, Security, and the Remaking of the Modern World. devotes quite a bit of space to arguing that there is considerable scope for further oil production increases, especially given that high prices drive exploration and investment:

The world has produced about 1 trillion barrels of oil since the start of the industry in the nineteenth century. Currently, it is thought that there are at least 5 trillion barrels of petroleum resources, of which 1.4 trillion is sufficiently developed and technically and economically accessible to count as proved plus probable reserves. Based upon current and prospective plans, it appears the world liquid production capacity should grow from about 93 million barrels per day in 2010 to about 110 mbd by 2030. This is about a 20 percent increase. (p.239 hardcover)

He also argues that rather than being followed by a sharp decline, the peak in global oil production is likely to be followed by a plateau of relatively stable production.

The overlapping uncertainty between peak oil and climate change is an important thing to consider, when trying to project what the world’s energy and climatic futures look like. If Yergin is right – and there is lots of oil left to burn – the need to develop and implement effective policies for reducing greenhouse gas pollution is even greater, since scarcity may not do much of the work for us.

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