Dick Lawrence on Skrebowski

Chris Skrebowski updated his "Megaprojeccts" analysis, which couples known data about oil field developments with best-available estimates of depletion. We saw him in Nov. 2005 estimating peak sometime in 2008; now with new data (extending the analysis down to many more & smaller fields) he estimates peak sometime in 2010 time frame - or "1500 days" which makes it sound more urgent, which it is of course.

There are as one would expect some significant uncertainties. Depletion rates are sometimes rough estimates as some fields recently peaked have short depletion histories. Another wild card is internal consumption of the oil-producing countries. Frequently these countries - like Indonesia and Iraq - subsidize gasoline to their citizens with a resulting ridiculously cheap price of fuel. If the benefits of this oil largesse are somewhat democratically distributed (rather than going to a few elites) you get a natural tendency for rapid growth of a middle class, which wishes to emulate that middle-class lifestyle and accompanying energy consumption. Thus there is a new factor that tends to reduce available oil for export.

This factor is not included in "mainstream" calculations of global oil available for export, but it's an increasingly important part of the equation that must be considered. Any country with big oil-based revenues, including the Soviet Union, will have growing internal consumption which means less for export.

Dick Lawrence
ASPO-USA