Before I continue on with the planned topic for my next post, there were a few items of note this past week that caught my attention.

First up is the World Economic Forum held this week in Davos, Switzerland. The statements and attitudes expressed by some participants (most notably from the head of the Saudi state oil firm Saudi Aramco) are indicative of a fundamental problem—and challenge—that will have to be addressed if we are to successfully counter the adverse effects of Peak Oil. I will soon be devoting a series of posts to the broader implications and considerations of those attitudes, but it’s worthwhile to take a look at the dismissive view by some in the energy/oil industry.

The chief executive of France-based Total, one of Europe’s major oil companies, like several other oil executives, has a realistic perspective about oil development and production in the face of (1) increasing demand from China, India, and other developing nations, (2) depletion of existing oil reserves, and (3) the lack of adequate discoveries of new oil. “The problem of peak oil remains,” Thierry Desmarest told his Forum audience. He has predicted that we’ll reach Peak Oil within ten years.

Other industry officials don’t seem to share those beliefs, yet their statements seem designed to cast aside all concerns about Peak Oil without … well, without providing any facts in support of their contrary positions.

“The concern about peak oil is behind us,” Saudi Aramco chief executive Khalid Al Falih told that same session on energy supplies.

I suppose the head of Saudi’s state oil firm can’t really be expected to say anything else (a “Duh!” moment if ever there was), but his flippant dismissal of Peak Oil is notably lacking in factual support other than the usual bromide about there being trillions of barrels of oil still underground. I’ve not disputed that in any of my prior posts.

But to castigate the Obama Administration (while taking care not to do so directly) for its “rhetoric” about the need for energy independence as being “unachievable and misleading to the public” does us all a tremendous disservice. I’m not sure how much we should lament the fact that honest discussions about the costs of our oil dependence make it more difficult for oil producers to seek investments and political support for their oil explorations. That is not the main problem we’ll be facing.

The more telling issue, and one that is routinely ignored by those who dispute Peak Oil as I’ve stated before, is that they never get around to explaining exactly how all that oil in the ground is going to get from there to here. The physical efforts of extraction, the refining needed, the environmental degradation, the amount of energy required to produce these “vast” resources, the incredible costs, the impact of inevitable delays on increasing demand, and the many related problems rarely get spelled out for the general public.

“There is too much rhetoric in the public domain about moving away from oil,” Al Falih stated. “There are plenty of resources out there.” I’m not sure what that’s all supposed to mean, but they are a perfectly suitable set of empty statements if your goal is to avoid discussion when you don’t have much beyond a lot of optimism to back you up. (And I’m all for optimism, but I don’t have quite as much faith in the magic of future technology as do some.)

The end result is that we hear sound bites such as “trillions of barrels of oil remain” and are left wondering what the fuss is all about. The loudest voices get most of the airplay. Is there a reason why the explanations of just how difficult and complex oil production will be going forward (and/or many decades this will all take, among many other equally relevant issues) get glossed over by those who advocate that we have enough oil to last us close to forever?

Instead, we get comforting assurances with all the proper buzz words, and soothing pats on the head. Facts every now and then would be nice. To be fair, Falih did state that “… most of what remains is more difficult and complex (to exploit) … [but] there’s no doubt we can do a lot more than the 95,100 (million barrels) that are projected in the next few decades.” How? Thierry Desmarest has indicated that it would be a “struggle” to meet that objective, so who to believe?

The unfortunate yet understandable truth is that the vast majority of us are far too consumed by life’s many daily challenges to spend much time on such apparently nebulous and distant problems like oil production and supply, so we leave it to “others” to take care of it. And those others all too often have vested interests in maintaining the status quo so as to guard against the government being placed in charge of “change” of any kind, or to protect profits—not that there’s anything intrinsically wrong with that … I’m all for capitalism. No doubt there are other reasons—some legitimate and some suspect.

But short-sighted perspectives are short-sighted for a reason, and there’s a cost.

The mere fact of uttering the platitude about having “plenty of oil” is not, as some appear to hope, the beginning and the end of discussions about the future of oil supply and demand. We will all be better served if we begin conducting more informed conversations about the topic.

Let’s not make Peak Oil quite the surprise it seems destined to be.

Sources:

http://www.tradearabia.com/news/OGN_173965.html – Saudis say don’t worry about peak oil
Davos: Thu, 28 Jan 2010  

http://rigzone.com/news/article.asp?a_id=86504&hmpn=1 – Aramco Chief: Plentiful Supply Trumps ‘Peak Oil’
by  Andrew Critchlow Dow Jones Newswires 1/28/2010

http://www.rte.ie/business/2010/0128/davos.html – China confident of continued growth
Thursday, 28 January 2010

http://brainstormtech.blogs.fortune.cnn.com/2010/01/28/oil-bigs-to-obama-get-real/?cnn=yes – Oil bigs to Obama: Get real. Posted by Adam Lashinsky, Senior Editor at Large January 28, 2010