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Gasoline and transportation oil can be manufactured from coal and other petroleum sources, meaning the world will not run out in any absolute sense, but the costs - both economic and environmental - will be far higher than conventional crude. Photo/REUTERS
With or without a binding deal at the climate talks in Copenhagen this month, it seems the world may have to cut its oil consumption, as emerging geological and economic trends limit the availability and affordability of petroleum.
Back in the 1970s,
Saudi Arabia’s flamboyant oil minister Sheik Ahmed Zaki Yamani articulated what has become conventional wisdom for policymakers around the planet: ‘’The Stone Age didn’t end for lack of stone, and the oil age will end long before the world runs out of oil.’’
Today, an increasing chorus of voices is challenging that prediction.
While the world isn’t running out of oil in any absolute sense, a daunting picture on the availability and thus affordability of supply compared with expected demand increases is beginning to emerge.
“In 2015, the world’s consumption of oil will likely be closing in on 100 million barrels per day, roughly 22 per cent higher than the current level - which is a relatively high annual growth for the oil industry,” states a briefing marked “confidential” from Canada’s Royal Canadian Mounted Police (RCMP), obtained by IPS a Freedom of Information Request.
The censored briefings, created in collaboration with other Canadian government agencies, paint a troubling picture of future energy security that has recently been corroborated by other sources.
In 2005, the International Energy Agency (IEA), the Paris-based multinational information centre created after the 1973 energy crises, predicted that world oil production could rise to 120 million barrels per day by 2030, up from 85 million bpd in 2008.
The IEA “was forced to reduce” its predictions on possible world supply “to 116 million and then 105 million last year,” according to a senior official in the organisation, who spoke with the Guardian newspaper in early November on the condition of anonymity.
The U.S. Department of Energy, through its International Energy Outlook (IEO), has also been quietly scaling down its numbers on possible supply.
In 2007, the agency predicted that the world would be able to pump 107.2 million barrels per day in 2030.
In summer 2009, it drastically reduced its supply predictions to 93.1 million barrels per day.
In its latest forecast, released November 10, the IEA predicted that world oil supply would hit 105 million barrels per day by 2030.
Even with those figures, which many analysts, including some inside the IEA, consider overly optimistic, there is likely to be a shortfall of some 11 million barrels per day by 2030.
“Every year we lose four million barrels a day [of production due to depletion],” said Jeff Rubin, the former chief economist with CIBC World Markets. “Over the next five years, we are going to have to find 20 million barrels a day of new production, just so that we can [continue to] consume what we consume today,” Rubin told IPS in June.
Rubin is a believer in the peak oil theory - the idea that oil production will reach a maximum point and then fall fairly sharply as demand outpaces possible supply.
