Forbes: peak oil in five to ten years [View All]

[Terry in Austin]

Forbes magazine, "The Capitalist Tool" and longtime energy-crunch denier, has published an interview with noted industry analyst Charles Maxwell, headlined "Bracing for Peak Oil Production by Decade's End."

Maxwell, senior energy analyst at Weeden & Co, points out that the world now uses 3 barrels of oil for every new barrel discovered. He goes on to explain:

A bind is clearly coming. We think that the peak in production will actually occur in the period 2015 to 2020. And if I had to pick a particular year, I might use 2017 or 2018. ...By 2020, we should be headed in a downward direction for oil output in the world each year.

He bases his analysis on the historical interval between "peak discovery" in an area and "peak production":

The peak of production usually comes sometime between 30 and 50 years after the peak of finding oil. I believe that the peak of {worldwide} discovery fell in the five-year interval between 1965 and 1970. So if you took it at, say, 1968, and then you added 50 years, you would get to 2018.

Then Maxwell examines the slim prospects of replacing petroleum energy shortfalls with alternatives:

But most alternative supplies... can't be expanded quickly. Solar power is too small to be meaningful. Wind power, again, is too small, and most of the good places for wind have already been taken. So it looks like alternative energies will plug only a very small part of the hole.

...Even if we decide to seize the nuclear alternative, it's still a decade before we can get the plants built and operating.

Other than some general suggestions about "using more coal," these investors focus their response to the situation on how to make the most money from it.

Maxwell's analysis of the situation, however, is pretty much on target, although it isn't really that much news. The real news is that the story has made it as far into the mainstream as Forbes magazine, and being treated seriously.