Peak oil is here and oil prices will keep rising, says physicist Michio Kaku
29 Mar 2012
Michio Kaku has a great short post at Big Think, “Solar Revolution,” arguing in simple terms that the world is near or at peak oil, and this is a big problem.
At a time when people like Newt Gingrich are saying “There is no peak oil,” it’s great to have someone like Kaku saying “Yes, there is.”
Now, why do I believe that oil prices will rise? Because of something called Hubbert’s Peak. Hubbert was a Shell Oil engineer way back in the 1960s who predicted that we would hit the halfway point for the production of oil in the United States and after that the bell-shaped curve would curve the other way and we would become an importer of oil.
Well, people laughed at him because they said that, “Well, wait a minute. We have Alaska. We have Texas. We have lots of oil fields, and so we’re not going to hit the 50% point. America will always export oil.” Well, wrong. Hubbert hit it right on the nose to within the year at which US oil supplies peaked and then it went to the other side of the bell-shaped curve. That’s called Hubbert’s Peak, when we hit the 50% point.
While this is mostly right, Kaku gets a few things wrong. A couple are more minor, but one is crucial.
First, I’ll sweat the small stuff. Hubbert was not an engineer. He was a geologist—one of the top geologists of the twentieth century.
Also, Hubbert’s Peak—at least as Hubbert conceived it—was only for crude oil. He was well aware of other ways of creating liquid fuels—such as cooking down tar sands and oil shale—but his curve, as he drew it, is just for the crude oil, the liquid stuff. Roughly speaking, he was talking about the rise and fall of cheap oil. When Kaku talks about peak oil, he seems to be talking about “peak liquid fuels,” which we don’t seem to have reached quite yet.
Now, to the more important part: Kaku says that US peak oil was a turning point, and the country had to start importing oil. That’s wrong; the U.S. stopped exporting oil around 1948 (give or take a year), and from then on has been a net importer.
The issue about U.S. peak oil production was not about it having to start importing oil, but rather that it would become increasingly dependent on imports. It’s about switching from having more and more domestically produced each year, to then coping with less and less domestic oil each year. The U.S. was the world’s largest oil importer at the time it reached its own peak production in 1970. It’s true, though, that after 1970, U.S. oil imports really soared.
For the whole world, the situation is much different, since there are no imports or exports. We don’t trade oil with other planets; we only have this one globe to rely on.
Kaku gets it. In his new book, Physics of the Future, he points out that in a famous talk in 1956, Hubbert not only correctly predicted when U.S. oil production would peak, but also predicted that the world could reach its peak of production in about 50 years—that is, around 2006.
On global oil, Kaku says in his Big Think piece:
Now we know that Hubbert was right and the next big question is, are we hitting Hubbert’s Peak for world oil production? That is the $64,000 question. Many people that I’ve talked to, senior oil analysts, energy analysts, say that we are either at Hubbert’s Peak or within ten years of hitting Hubbert’s Peak.
Now some people say, “Well that’s stupid. We discover new oil deposits all the time. Look at Canada. We have tar sands of Canada, right?” Wrong. It turns out that we will always have oil. We will never run out of oil, except oil will become more expensive as we go down the other side of Hubbert’s Peak. We would have to discover a new Saudi Arabia every five to ten years in order for this curve to simply go on forever. That’s not going to happen. I don’t care how many tar sands you’re talking about in Canada. You’re not going to create a new Saudi Arabia, which produces very clean, very cheap oil, oil that is prized by the oil companies because it is relatively less polluting and has tremendous amounts of profits associated with it.
So we do know that oil prices will fluctuate because of politics, but on average it will start to rise because we will be hitting Hubbert’s Peak.
On oil prices, I agree—except that oil prices have already risen a lot over the past decade. So they won’t “start to rise”; they’ll keep rising, it seems—at least relative to people’s ability to purchase oil. (This seems to be an unfortunate slip of the tongue; in his book,
And, yes, in a sense we will always have oil. But I think that he has skipped over an important point, which is that after the peak, oil production will be generally declining—that is, the world will have to get by with less and less oil each decade.
I think it’s crucial to stress that actual production could soon go into a long decline, because otherwise it is easy for economists and others who usually focus on dollars to argue that the world can cope with expensive oil. It’s harder to argue that the world can cope with less and less oil each decade—unless we manage to make a Solar Revolution like Kaku hopes for.