Letters to the Editor
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Our greed has actually deprived us of oil...
Don't confuse greed with myopia. Forgoing greater profits in the long run in exchange for smaller short run profits is not a fault of greed, but of myopic decision making. The truly greedy person would have left the $10 dollar a barrel oil in the ground and pumped out the $70 dollar a barrel oil years later.
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Two quotes from that nytimes article...
I found interesting:
In a wide-ranging study published in 2000, the U.S. Geological Survey estimated that ultimately recoverable resources of conventional oil totaled about 3.3 trillion barrels, of which a third has already been produced. More recently, Cambridge Energy Research Associates, an energy consultant, estimated that the total base of recoverable oil was 4.8 trillion barrels. That higher estimate -- which Cambridge Energy says is likely to grow -- reflects how new technology can tap into more resources.
and,
Typically, oil companies can only produce one barrel for every three they find. Two usually are left behind, either because they are too hard to pump out or because it would be too expensive to do so. Going after these neglected resources, energy experts say, represents a tremendous opportunity.
Supposing the 2000 estimate is roughly correct, and about 1/3 of hypothesized reserves have been produced and oil companies only produce 1/3 of 'found' reserves doesn't it suggest that we are really close to peak cheap oil as you suggest?
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Get it straight - Peak Oil is not, NOT about "running out" of oil
As I said in my post above, Peak Oil occurs when we no longer pump more oil out of the ground this year than last year. It's that simple. It's not about how much it costs, or how much is left, or "if only the middle east weren't a bloodbath, we could pump more out". We pumped 85 billion barrels out last year (about), if we do not pump out 86 billion this year or the year after (ever), then our oil supply has "peaked". Period.
This is not a theory to be proved or disproved. Every single honest scientist - and even most of the big oil companies - admit that Peak Oil is an indisputable fact. The real question is: a) when it will occur and b) will we be able to supply additional alternative energy from other sources to do the things we need to get done.
The answer seems to be a) nobody frikin knows, but it could happen *any time* in the next 30 or so years. b) Maybe, but it depends on getting ready now, if you wait until it's happening, as we are finding with Global Warming, it's usually too late to save a lot of what is valuable to you.
Adults plan for an future in a serious way, children close their eyes and wish for something better (the market/scientists/politicians/daddy will make it better).
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The problem with the "peak oil" wolf crying
It has already been pointed out that people have been harping on imminent disaster for 30 years, and that that is part of the problem. So far technology has been keeping up with demand--even though, as pointed out, production of individual fields is decreasing fairly much as expected. So is this "peak oil?" Well I think people have problems with "peak oil" as a concept/crying out in the wilderness because it is mostly presented as doomsday. We reached "peak whale oil" and our houses are still lit, thanks to regular old oil and kerosene (and then electricity). Running out of oil seems to be something that is necessarily out of the blue and catastrophic to fit the "peak oil" mania. There's plenty of coal left (which can be liquified--the Nazis were hampered by running out of oil, but they worked out technological work arounds), nuclear power, solar, wind, biofuels, whatever. I wouldn't necessarily bet against humanity's adaptability.
In terms of the poster that says someting to the effect that "America used to be Saudi Arabia," I'd like to point out this: https://www.cia.gov/cia/publications/factbook/rankorder/2173rank.html That is America is STILL the 3rd largest producer of oil (other sites claim 4.8 m barrels per day, but that'd still make the US number 3). We produce less than we did by about 50%, but we still produce a significant amount. Unfortunately for us, we also consume about 20 million barrels per day, far more than anyone else. Yeah we peaked, but 30 years ago and not disastrously and what we have is a runaway consumption problem as much as a declining production problem.
By the way, had_enough, it is easy for you to demand an apology in Salon years hence because I doubt you would provide one in turn--look at the proliferation of Malthusian nuts on Salon that post that the world is at its population limit and nobody should have kids. The world was supposed to be on the brink of its human carrying capacity two centuries ago. Nobody is apologizing for that, in fact there are plenty of people still predicting it. That's not to say that it isn't possible that catastrophe won't come to pass--it is just to point out that doomsday predictions are seldom repudiated--the due date just gets pushed out.
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I don't understand how that greed hypothesis got a star
Oil is a commodity--it is IMPOSSIBLE to choose which barrel to pump out of the ground based on price of recovery unless you are fixing prices. Saudi Arabia can basically poke a straw in the ground and get oil out (I forget whose quote that is). There is absolutely no way that you could say to the Saudis to not produce at all while you pumped out $70 a barrel oil from elsewhere. They'd produce happily at $70 a barrel, maybe, but the temptation to undercut you would always be there as not every producer is an absolute monarchy.
You can monkey with the market clearing price as a cartel, but without one the market will clear based on supply and demand--and if you have a lot of $10 a barrel oil around, that point won't be $70.
Maybe I misunderstood the poster, but that's like saying why don't we just legislate against inflation.
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Greed
The point was that the decision to extract or not extract a barrell is a dynamic one. Suppose from our perspective the optimal profit maximizing strategy for the Mexican field was to NOT employ short-run techniques that harm the long term prospects of extraction. This optimal long-run strategy would be chosen by a greedy individual, because it maximizes profits. The fact that the Mexican field DID employ damaging techniques that increased short-run yields at the cost of long-run profits is a result of myopic decision making, not greed, because the greedy individual should have taken the long-run extraction path.
Just pointing out that there are dynamic considerations of extraction to take into account, and attributing short-run maximization to greed is misplaced.