ddtuttle

Where Have All the Peak Oil Believers Gone?

Peak Oil has two components supply and demand. What we saw when oil hit $147 /bbl was demand outstripping demand for a brief moment. The demand side has collapsed since, and the price along with it.

But the supply problem persist. Check out the FT article reviewing a draft of the IEA's annual report. The upshot is that we need invest $350B / yr into existing oil infrastructure, including developing known fields and finding new ones, or face severe shortages.

Underlying this is a 9% annual drop in existing oil production from the world's premier fields. Anybody who's looked at it knows a 9% drop in oil production is catastrophic for the global economy. If it comes on the heels of the worst recession since the 1930's, we are in for a world of hurt.

So, you see, peak oil is alive and well, and the IEA is now one of the strongest proponents.