Peak-oil or oil plateau? The world's finite energy supplies

At the indispensable TomDispatch, Michael Klare warns of over-optimism regarding the current fall in oil prices:

“…..does the recent drop in gasoline prices and the seemingly sudden abundance of petroleum reveal a flaw in the argument for this as a peak-oil moment? Peak-oil theory, which had been getting ever more attention until the price at the pump began to fall, contends that the amount of oil in the world is finite; that once we've used up about half of the original global supply, production will attain a maximum or "peak" level, after which daily output will fall, no matter how much more is spent on exploration and enhanced extraction technology.”

“Some peak-oil theorists have, however, done us all a disservice by suggesting, for rhetorical purposes, that the peak-oil moment is… well, a sharp peak. They paint a picture of a simple, steep, upward production slope leading to a pinnacle, followed by a similarly neat and steep decline. Perhaps looking back from 500 years hence, this moment will have that appearance on global oil production charts. But for those of us living now, the "peak" is more likely to feel like a plateau -- lasting for perhaps a decade or more -- in which global oil production will experience occasional ups and downs without rising substantially (as predicted by those who dismiss peak-oil theory), nor falling precipitously (as predicted by its most ardent proponents).”

During this interim period, particular events -- a hurricane, an outbreak of conflict in an oil region -- will temporarily tighten supplies, raising gasoline prices, while the opening of a new field or pipeline, or simply (as now) the alleviation of immediate fears and a temporary boost in supplies will lower prices. Eventually, of course, we will reach the plateau's end and the decline predicted by the theory will commence in earnest.”

Read the rest here. And for an in-depth look at the geopolitics of oil, the basis (and folly) of western interventions in the Middle East, and why weaning ourselves off fossil fuels would be an urgent task even if there were no climate change to worry about, I highly recommend Klare’s book “Blood and Oil: The Dangers and Consequences of America's Growing Dependency on Imported Petroleum”.