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A few quotes from that UT article:

“Gauthier, part of a federal team tracking global oil reserves, doesn’t believe that the world is close to running dry. We may be able to extract an additional 1 trillion barrels from existing fields, he maintains, thanks to new techniques, such as using steam to push more oil out. West African waters show great potential, he said. Unconventional sources, like turning oil shale or natural gas into liquified fuels, could boost reserves to nearly 10 trillion barrels.”

“At the world’s current rate of consumption — 30 billion barrels of liquid hydrocarbons a year — that’s enough to meet current global demand for another three centuries.”

And finally:

“we’re still burning it faster than we’re discovering it.”

[Rich Toscano]

Contrary to what appears to be popular belief in the media, the “peak oil” concept is not about the amount of reserves, it’s about flow rates. IE, it’s not how much oil is underground, it’s how many barrels can be produced/processed on a daily basis.

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

I am not an “expert” either but this is my understanding from reading/talking to people who are. (For those who wish to know more, try http://gregor.us/ — this is a blog written by Gregor Macdonald, a great energy analyst in addition to being a brilliant macro analyst imho).

Rich

[Rich Toscano]

Contrary to what appears to be popular belief in the media, the “peak oil” concept is not about the amount of reserves, it’s about flow rates. IE, it’s not how much oil is underground, it’s how many barrels can be produced/processed on a daily basis.

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

I am not an “expert” either but this is my understanding from reading/talking to people who are. (For those who wish to know more, try http://gregor.us/ — this is a blog written by Gregor Macdonald, a great energy analyst in addition to being a brilliant macro analyst imho).

Rich

[Rich Toscano]

Contrary to what appears to be popular belief in the media, the “peak oil” concept is not about the amount of reserves, it’s about flow rates. IE, it’s not how much oil is underground, it’s how many barrels can be produced/processed on a daily basis.

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

I am not an “expert” either but this is my understanding from reading/talking to people who are. (For those who wish to know more, try http://gregor.us/ — this is a blog written by Gregor Macdonald, a great energy analyst in addition to being a brilliant macro analyst imho).

Rich

[Rich Toscano]

Contrary to what appears to be popular belief in the media, the “peak oil” concept is not about the amount of reserves, it’s about flow rates. IE, it’s not how much oil is underground, it’s how many barrels can be produced/processed on a daily basis.

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

I am not an “expert” either but this is my understanding from reading/talking to people who are. (For those who wish to know more, try http://gregor.us/ — this is a blog written by Gregor Macdonald, a great energy analyst in addition to being a brilliant macro analyst imho).

Rich

[Rich Toscano]

Contrary to what appears to be popular belief in the media, the “peak oil” concept is not about the amount of reserves, it’s about flow rates. IE, it’s not how much oil is underground, it’s how many barrels can be produced/processed on a daily basis.

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

I am not an “expert” either but this is my understanding from reading/talking to people who are. (For those who wish to know more, try http://gregor.us/ — this is a blog written by Gregor Macdonald, a great energy analyst in addition to being a brilliant macro analyst imho).

Rich

[davelj]

[quote=Rich Toscano]

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

[/quote]

My understanding – and I ain’t no expert either – is that shale oil extraction is capable of replacing the flow lost from conventional oil sources, but… it’s just much more expensive and, as you note, causes more environmental damage. My buddy in Shreveport – who’s kind of an armchair expert (I think that’s an oxymoron) on this – says that if oil prices stayed above $125/barrel for several years, shale oil extraction would be economical and would ramp up over a period of years to replace a lot of the traditional flow. But, again, that’s just one man talking.

[My understanding is that break-even economics for oil in the Middle East are at about $20/barrel, at about $35/barrel in Louisiana and Texas, and $80-$95/barrel for shale. Just for perspective.]

What’s kind of interesting is that in my reading I saw that the largest deposits of shale oil in the world are in Colorado – like half of the known global deposits, or something like that. It would be interesting if in 20 years or so, assuming oil prices are much higher than they are now on a real basis (a good bet, I’d say), Colorado became a major player in the oil industry and supplied a large portion of domestically-consumed oil.

[davelj]

[quote=Rich Toscano]

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

[/quote]

My understanding – and I ain’t no expert either – is that shale oil extraction is capable of replacing the flow lost from conventional oil sources, but… it’s just much more expensive and, as you note, causes more environmental damage. My buddy in Shreveport – who’s kind of an armchair expert (I think that’s an oxymoron) on this – says that if oil prices stayed above $125/barrel for several years, shale oil extraction would be economical and would ramp up over a period of years to replace a lot of the traditional flow. But, again, that’s just one man talking.

[My understanding is that break-even economics for oil in the Middle East are at about $20/barrel, at about $35/barrel in Louisiana and Texas, and $80-$95/barrel for shale. Just for perspective.]

What’s kind of interesting is that in my reading I saw that the largest deposits of shale oil in the world are in Colorado – like half of the known global deposits, or something like that. It would be interesting if in 20 years or so, assuming oil prices are much higher than they are now on a real basis (a good bet, I’d say), Colorado became a major player in the oil industry and supplied a large portion of domestically-consumed oil.

[davelj]

[quote=Rich Toscano]

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

[/quote]

My understanding – and I ain’t no expert either – is that shale oil extraction is capable of replacing the flow lost from conventional oil sources, but… it’s just much more expensive and, as you note, causes more environmental damage. My buddy in Shreveport – who’s kind of an armchair expert (I think that’s an oxymoron) on this – says that if oil prices stayed above $125/barrel for several years, shale oil extraction would be economical and would ramp up over a period of years to replace a lot of the traditional flow. But, again, that’s just one man talking.

[My understanding is that break-even economics for oil in the Middle East are at about $20/barrel, at about $35/barrel in Louisiana and Texas, and $80-$95/barrel for shale. Just for perspective.]

What’s kind of interesting is that in my reading I saw that the largest deposits of shale oil in the world are in Colorado – like half of the known global deposits, or something like that. It would be interesting if in 20 years or so, assuming oil prices are much higher than they are now on a real basis (a good bet, I’d say), Colorado became a major player in the oil industry and supplied a large portion of domestically-consumed oil.

[davelj]

[quote=Rich Toscano]

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

[/quote]

My understanding – and I ain’t no expert either – is that shale oil extraction is capable of replacing the flow lost from conventional oil sources, but… it’s just much more expensive and, as you note, causes more environmental damage. My buddy in Shreveport – who’s kind of an armchair expert (I think that’s an oxymoron) on this – says that if oil prices stayed above $125/barrel for several years, shale oil extraction would be economical and would ramp up over a period of years to replace a lot of the traditional flow. But, again, that’s just one man talking.

[My understanding is that break-even economics for oil in the Middle East are at about $20/barrel, at about $35/barrel in Louisiana and Texas, and $80-$95/barrel for shale. Just for perspective.]

What’s kind of interesting is that in my reading I saw that the largest deposits of shale oil in the world are in Colorado – like half of the known global deposits, or something like that. It would be interesting if in 20 years or so, assuming oil prices are much higher than they are now on a real basis (a good bet, I’d say), Colorado became a major player in the oil industry and supplied a large portion of domestically-consumed oil.

[davelj]

[quote=Rich Toscano]

The processing required for shale oil as well as tar sands makes them different from the good old days where the Saudis could just turn a valve and increase the flow rate (which they still can do on some fields, but this is just on a small marginal proportion of total supply). They also have much greater environmental impact, to the extent that ramping them up too much would cause other problems.

So shale/tar sands may represent a vast reserve of oil in the ground, but it’s questionable as to whether they can replace the flow lost from declining conventional oil sources.

[/quote]

My understanding – and I ain’t no expert either – is that shale oil extraction is capable of replacing the flow lost from conventional oil sources, but… it’s just much more expensive and, as you note, causes more environmental damage. My buddy in Shreveport – who’s kind of an armchair expert (I think that’s an oxymoron) on this – says that if oil prices stayed above $125/barrel for several years, shale oil extraction would be economical and would ramp up over a period of years to replace a lot of the traditional flow. But, again, that’s just one man talking.

[My understanding is that break-even economics for oil in the Middle East are at about $20/barrel, at about $35/barrel in Louisiana and Texas, and $80-$95/barrel for shale. Just for perspective.]

What’s kind of interesting is that in my reading I saw that the largest deposits of shale oil in the world are in Colorado – like half of the known global deposits, or something like that. It would be interesting if in 20 years or so, assuming oil prices are much higher than they are now on a real basis (a good bet, I’d say), Colorado became a major player in the oil industry and supplied a large portion of domestically-consumed oil.

[sdduuuude]

I’m fascinated with natural resource economics, though certainly no expert. I took a natural resorce economics class from a terriffic teacher in grad school. So much to learn in this area.

Anyway, gregor wrote a pretty cool article a while back pointing out that if we don’t use the last of our cheap oil to build the next generation of stuff to produce power using more expensive ways , we’ll be screwed and we’ll have to revert to coal-based technology for a long time. I thought it was an interesting way to look at the problem.

Just picking a nit here … I’m not sure I like this definition, from the original post: “oil ‘crunch’ (when demand exceeds production)”

Demand is a function of price, so if demand exceeds production, the price will change, then demand will change, then demand no longer exceeds production. Does that mean the oil crunch is over? No.

Most mainstream articles avoid talking about dynamic price changes and the effect on peak oil, but you can’t really model peak oil without it.

I think “oil crunch” (i.e. “peak oil”) is where physical limitations forcibly reduce how much oil can be extracted per day. As Rich said – it is a flow issue. There are also some dynamic cost issues associated with the concept of peak oil as well. That is – as davelj said – if the price of oil increases enough to justify new extraction methods then peak oil could be delayed because production capacity would be increased. Also, any “crunch” would be mitigated as demand would come down.

I think Americans are so wasteful and spoiled on cheap oil that when crunch time comes, we’ll find it quite easy to live using less oil. That combined with the price-related dynamics of the market suggest to me that any real major oil crunch is 20 years or more down the road.

Peak oil may come sooner than that, but the nasty effects of it will come much later, if ever.

[sdduuuude]

I’m fascinated with natural resource economics, though certainly no expert. I took a natural resorce economics class from a terriffic teacher in grad school. So much to learn in this area.

Anyway, gregor wrote a pretty cool article a while back pointing out that if we don’t use the last of our cheap oil to build the next generation of stuff to produce power using more expensive ways , we’ll be screwed and we’ll have to revert to coal-based technology for a long time. I thought it was an interesting way to look at the problem.

Just picking a nit here … I’m not sure I like this definition, from the original post: “oil ‘crunch’ (when demand exceeds production)”

Demand is a function of price, so if demand exceeds production, the price will change, then demand will change, then demand no longer exceeds production. Does that mean the oil crunch is over? No.

Most mainstream articles avoid talking about dynamic price changes and the effect on peak oil, but you can’t really model peak oil without it.

I think “oil crunch” (i.e. “peak oil”) is where physical limitations forcibly reduce how much oil can be extracted per day. As Rich said – it is a flow issue. There are also some dynamic cost issues associated with the concept of peak oil as well. That is – as davelj said – if the price of oil increases enough to justify new extraction methods then peak oil could be delayed because production capacity would be increased. Also, any “crunch” would be mitigated as demand would come down.

I think Americans are so wasteful and spoiled on cheap oil that when crunch time comes, we’ll find it quite easy to live using less oil. That combined with the price-related dynamics of the market suggest to me that any real major oil crunch is 20 years or more down the road.

Peak oil may come sooner than that, but the nasty effects of it will come much later, if ever.

[sdduuuude]

I’m fascinated with natural resource economics, though certainly no expert. I took a natural resorce economics class from a terriffic teacher in grad school. So much to learn in this area.

Anyway, gregor wrote a pretty cool article a while back pointing out that if we don’t use the last of our cheap oil to build the next generation of stuff to produce power using more expensive ways , we’ll be screwed and we’ll have to revert to coal-based technology for a long time. I thought it was an interesting way to look at the problem.

Just picking a nit here … I’m not sure I like this definition, from the original post: “oil ‘crunch’ (when demand exceeds production)”

Demand is a function of price, so if demand exceeds production, the price will change, then demand will change, then demand no longer exceeds production. Does that mean the oil crunch is over? No.

Most mainstream articles avoid talking about dynamic price changes and the effect on peak oil, but you can’t really model peak oil without it.

I think “oil crunch” (i.e. “peak oil”) is where physical limitations forcibly reduce how much oil can be extracted per day. As Rich said – it is a flow issue. There are also some dynamic cost issues associated with the concept of peak oil as well. That is – as davelj said – if the price of oil increases enough to justify new extraction methods then peak oil could be delayed because production capacity would be increased. Also, any “crunch” would be mitigated as demand would come down.

I think Americans are so wasteful and spoiled on cheap oil that when crunch time comes, we’ll find it quite easy to live using less oil. That combined with the price-related dynamics of the market suggest to me that any real major oil crunch is 20 years or more down the road.

Peak oil may come sooner than that, but the nasty effects of it will come much later, if ever.

[sdduuuude]

I’m fascinated with natural resource economics, though certainly no expert. I took a natural resorce economics class from a terriffic teacher in grad school. So much to learn in this area.

Anyway, gregor wrote a pretty cool article a while back pointing out that if we don’t use the last of our cheap oil to build the next generation of stuff to produce power using more expensive ways , we’ll be screwed and we’ll have to revert to coal-based technology for a long time. I thought it was an interesting way to look at the problem.

Just picking a nit here … I’m not sure I like this definition, from the original post: “oil ‘crunch’ (when demand exceeds production)”

Demand is a function of price, so if demand exceeds production, the price will change, then demand will change, then demand no longer exceeds production. Does that mean the oil crunch is over? No.

Most mainstream articles avoid talking about dynamic price changes and the effect on peak oil, but you can’t really model peak oil without it.

I think “oil crunch” (i.e. “peak oil”) is where physical limitations forcibly reduce how much oil can be extracted per day. As Rich said – it is a flow issue. There are also some dynamic cost issues associated with the concept of peak oil as well. That is – as davelj said – if the price of oil increases enough to justify new extraction methods then peak oil could be delayed because production capacity would be increased. Also, any “crunch” would be mitigated as demand would come down.

I think Americans are so wasteful and spoiled on cheap oil that when crunch time comes, we’ll find it quite easy to live using less oil. That combined with the price-related dynamics of the market suggest to me that any real major oil crunch is 20 years or more down the road.

Peak oil may come sooner than that, but the nasty effects of it will come much later, if ever.

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