What I found

"There are currently 98 oil producing countries in the world, of which 64 are thought to have passed their geologically imposed production peak, and of those 60 are in terminal production decline."

So says David Strahan. Naturally, this made me a little concerned, so I poked around some more trying to figure out what this whole concept of peaking actually meant. A little bit of what I discovered is below, although there's lots more where that came from. A quick note before I get going. Even though I'm studying Resource Politics, I know almost nothing about the world oil situation. I want to combine my RePol (as we call it) studies with my Conflict Resolution work, so I've been focusing more on water, arable land, access to coasts--resources that groups or nations can generally only acquire by getting and keeping territory. To tell the truth, I've been pretty much avoiding looking at oil's implications for world affairs in my studies...but I guess we're all going to be experts on crude oil indexes now. Anyway, to business:

"The particular scenario shown in Figure 2 depicts the 2 percent demand growth experience of recent years extended up to the production peak (similar to the 2.2 percent rate applied through 2020 in EIA's 2002 International Energy Outlook) and then the decline path from the peak at a constant R/P ratio of 10. The three divergent curves shown reflect alternative resource base volumes. From left to right they are the sum of the USGS's United States and rest-of-world resource estimates at the 95 percent certain (19 chances in 20 of that much or more), the statistical mean (expected value), and 5 percent certain (1 chance in 20 of that much or more) volumetric levels. Thus, if the USGS mean resource estimate proves to be correct, if 2 percent production growth continues until peak production is reached, and if production then declines at an R/P ratio of 10, world conventional crude oil production would be expected to peak in 2037 at a volume of 53.2 billion barrels per year."

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So, basically, the EIA is planning for oil to peak in 2037. But lots of other people think that it's likely to peak around 2020. Or 2015. Or 2010. Or -gulp- 2005. Now look at this:

Over the years, the excess capacity (and max capacity) of the OPEC nations has been steadily declining, and the price (understandably) of crude oil has been increasing. This make sense - but what if the numbers OPEC gave were inflated? Or even just honestly overestimated? By, say 15, 20, 50 years of production capacity? It could explain the wildly different predictions for when the world's oil supply will peak. And it could explain why we're so woefully unprepared now, if what we're really dealing with is the other side of that graph in Figure 2 above--the side that drops like a stone.

Obviously this is an incredibly broad analysis. But despite all the media hype, I'm not convinced yet that we won't wake up tomorrow, or next week, and find gas prices back to normal--or, at least, $3 a gallon. I'm not panicking yet, and I don't see too many people here panicking either. There's lots of grumbling, of course, but gas prices have spiked before. This elderly woman came into work today and told me about how when she drove a car for the first time, gas was $0.23 a gallon. For her, this is just another jump in a long trend. Maybe in 20 years, we'll look back at this as just another jump too. But if that's the case, I hope we're all driving electric cars by then.

Just one more thing to ponder:

TIMELINE: A HISTORICAL LOOK AT OIL PRICES

In real terms, stripping out the impact of inflation, oil prices are much lower today than the highs of some past spikes. The following details average annual dollar-denominated oil prices in the money of the day and the equivalent price in 2003. Year Money of the day 2003 dollars 1861 - Pennsylvania oil boom 0.49 10.08 1876 - Russian oil exports start 2.56 43.38 1945 - Post-war reconstruction 1.05 10.79 1974 - Arab oil embargo 11.58 43.38 1979 - Iranian revolution 30.03 76.40 1980 - Iranian revolution 35.69 79.99 1981 - Post-Iranian revolution 34.28 69.59 1990 - Iraqi invasion of Kuwait 23.84 33.54 1998 - Asian economic crisis 13.11 14.80 2004 - Year-to-date 35.62* 35.62* 1861-1944: U.S. average, 1945-1985: Arabian Light posted at Ras Tanura, 1986-present day: Brent spot

*As of Sept. 27, 2004 Source: Reuters, BP Statistical Review of 2003