The latest issue of Foreign Policy magazine has run a couple of letters responding to its cover story last month on oil by Daniel Yergin of CERA. In case you missed it, Yergin argued, on the eve of the 150th anniversary of oil first being drilled, that despite a rapidly shifting outlook there was adequate oil supply for decades to come.
Matt Simmons, who is just as prominent an advocate for peak oil, actually wrote his own response a week later, but FP has continued the debate on its letters page. Simmons writes:
Data from the International Energy Agency (IEA) and the U.S. Energy Department show that the global flow of crude oil peaked in 2005 and is now sliding steadily. The world will never run out of oil altogether, but oil’s flow is in decline. There might still be ample reserves left in the ground when production falls to half of today’s use. But these remaining reserves are either very low-quality heavy oil, which is difficult to process, or tainted with toxic elements that make them hard to refine into usable petroleum products.
Meanwhile Kjell Aleklett, an academic and also a very prominent peak oilist, also gets an appearance on the letters page and points out the IEA data, among others.
Yergin, in turn, says he also relied heavily on last year’s World Energy Outlook, the weighty annual tome published by the International Energy Agency, relied heavily on data from about 800 oil fields compiled by Yergin’s IHS CERA.
There’s a little bit of irony in this, surely. Last year’s World Energy Outlook marked for many observers the point at which the IEA adopted a tone far more favourable of peak oil theory. The inclusion of data from that very set of 800-odd fields saw the IEA revise its decline rate for post-peak fields from 3.7 per cent to 6.7 per cent. Enough to set off headlines all around the world about the decline of oil.
The data, to be fair, can be interpreted in a multitude of different ways. The much-quoted 6.7 per cent decline rate only applies to post-peak fields, which made up about 580 of those 800 fields.