Articles tagged with "matthew simmons"
The latest OPEC Monthly Oil Market Report (MOMR) foresees that demand for OPEC crude oil will decline over the next year by about 300 kbd. This is largely in anticipation of additional production from elsewhere:
Non-OPEC supply is forecast to increase by 0.7 mb/d in 2012, supported by the anticipated growth from North America, Latin America, and FSU. In 2013, non-OPEC oil supply is expected to grow by 0.9 mb/d. The US, Canada, Brazil, Kazakhstan, and Colombia are expected to be the main contributors to supply growth, while Norway, Mexico, and the UK are seen experiencing the largest declines. OPEC NGLs and non-conventional oils are seen averaging 5.9 mb/d in 2013, indicating an increase of 0.2 mb/d over this year.
Overall, OPEC sees demand staying below 90 mbd over the remainder of this year, with total growth in demand lying at 1.01 mbd.
Much has happened since the late Matt Simmons and Nansen Saleri got together back in February 2004 to debate scenarios for future oil production in Washington. While Matt had developed his research that led into the publication of “Twilight in the Desert”, this was the meeting where Aramco pushed back to explain that there would not be a global problem for at least fifty years. As this series of posts on Saudi Arabia comes to a conclusion and moves on to other countries, it is perhaps of some value to look back on the presentation by Mahmoud Abdul Baqi and Hansen Saleri to remember what was said. Back in those days, oil demand was expected to steadily rise with increasing rates to reach 100 mbd in 2015.
On March 9, Dr Saleri (who debated Matt Simmons at CSIS in February 2004, on Matt’s concerns expressed in what became “Twilight in the Desert”) had an opinion piece in the Wall Street Journal in which he said:
"In the context of global liquids production, the civil strife in Libya represents a minor disruption (less than 2% of the total, approximately 85 million barrels of oil per day). Nor is there any evidence to suggest that even a protracted scenario of instability will result in a sustained reduction of crude supplies. Iraqi oil production dropped by 30% at the start of the second Iraq war in 2003, and then it quickly bounced back to the prewar level of two million barrels of oil per day. Currently, Iraqi oil production stands at 2.6 million barrels of oil per day, with much higher levels projected during this decade."
Since I recently commented that neither Iran nor Iraq had bounced back to pre-revolutionary levels, I will let you decide who is correct. Here is the EIA plot of Iraqi production since the 1990 invasion of Kuwait.
I would suggest that the figure shows that Dr Saleri is being a bit of an optimist. It is interesting to note that the pre-invasion of Kuwait production level of 3.5 mbd in 1990 collapsed to a level of 300,000 bd as a result of that invasion and has not been re-established 20 years later.
Posted by David Murphy on January 14, 2011 - 10:55am
Tags: bets, david murphy, depletion, john tierney, julian simon, matthew simmons, original, paul ehrlich, scarcity [list all tags]
For decades, economists (Cornucopians or optimists) have been at odds with natural scientists (Malthusians or pessimists) when it comes to the scarcity of natural resources. The economist’s argument, summarized here by Julian Simon, is as follows:
More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity, and prompt inventors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred. (Simon 1996)
The viewpoint of natural scientists seems to be a bit simpler; the more scarce something is the higher the price, leading to increasing prices as resources deplete over time. These opposing views have led to some famous wagers in the past. The most famous occurred in 1980 between economist Julian Simon and natural scientist Paul Ehrlich. The wager was whether the price of five metals would increase in ten years time. Simon won the bet. Another bet was made more recently. In 2005, John Tierney of the New York Times wagered with Matt Simmons over the price of oil. Simmons bet $5,000 that the price of oil would be $200 per barrel in 2010. Tierney won the bet.
As a result, Tierney has publicly applauded himself and the economists’ view in a recent article in the New York Times. He states: “Maybe something unexpected will change these happy trends, but for now I’d say that Julian Simon’s advice remains as good as ever. You can always make news with doomsday predictions, but you can usually make money betting against them.”
But what is the real message (if any) to be gleaned from these bets? Is it that economists are always right and natural scientists always wrong? Is it that prices decline for commodities over time?
I argue that there is very little (if anything) to be learned from these bets, and I explain why below the fold.
This is a guest post by Steve Andrews and John Theobald. Sally Odland and Randy Udall also contributed. Andrews and Udall are retired co-founders of ASPO-USA. Odland and Theobald are formerly associated with ASPO-USA. The four of them currently are developing a new peak oil project.
“Petroleum is industrial oxygen,” Matt Simmons liked to say. The more he looked, the more convinced he was that much of our energy system was being red-lined, run on the ragged edge of disaster. And look he did—more than 50 hours a week by his own description. “Some people play golf,” Matt said. His hobby was looking at energy data. Often, he was alarmed, and sometimes—as with recent ill-advised comments about BP’s Gulf of Mexico oil spill—he could be alarmist. Readers of The Oil Drum know plenty about that, (http://www.theoildrum.com/node/6789). But no matter. The contribution he made was titantic, in every sense of the word.
We are saddened by the news that Matt Simmons died suddenly on Sunday, August 8, at his summer home in Maine. Matt Simmons was an energy investment banker and spoke frequently about peak oil. Matt was Chairman of the Association for the Study of Peak Oil-USA (ASPO-USA) Advisory Board. Matt was also founder and chairman of Simmons & Company International, and author of Twilight in the Desert.
Anyone who has attended a meeting of the ASPO-USA will remember hearing Matt speak. One of Matt's big concerns was the lack of availability of transparent data with respect to oil and gas reserves, as explained in slides such as this one (from his talk at the 2009 ASPO-USA conference).
Matt Simmons, author of Twilight in the Desert, has long been one of the most famous and influential voices on the subject of peak oil. After the release of his book, Simmons rose to fame as Saudi Arabian oil production declined and global oil prices skyrocketed.
However, Simmons has lately been making hyperbolic claims related to the deepwater spill in the Gulf of Mexico. Based on the scenarios Simmons has outlined, he argues for responses such as using a nuclear explosion to seal the well and evacuating 20 million people from the Gulf Coast. Extraordinary responses such as these would impact a great many people, so The Oil Drum staff felt that a critical look at some of Simmons’ claims was in order.
Posted by Robert Rapier on September 22, 2009 - 2:00pm
Tags: book review, matthew simmons, oil companies, oil consumption, oil exploration, oil production, peter maass [list all tags]
It succors and drowns human life. And for the last eight years, oil — and the people and places that make it — was my obsession. - Peter Maass
Today a new book by Peter Maass was released. The book is called Crude World: The Violent Twilight of Oil. Peter Maass is a name you may know from a 2005 article that he wrote for the New York Times called The Breaking Point. The story was a comprehensive look at where he thought oil production/prices were headed - and what the implications might be. Maass focused on Saudi Arabia in the article, and spent a lot of time covering Matt Simmons' viewpoints. It was after reading this story that New York Times columnist John Tierney offered to bet Simmons on the future direction of oil prices. Thus arose the Simmons-Tierney bet.
I thought Maass' 2005 article was well-researched, and it was a captivating read. So when Mr. Maass e-mailed and asked if I would like a copy of his new book, I thought it would probably be a book I would enjoy. I still have a stack of books that have been sent to me to review, but I jumped this one to the front of the queue. I hadn't really intended to, as I am working on two other books right now*, and would normally finish those before starting another. But once I picked this book up and started thumbing through it, I couldn't put it down.
This is a link to Matt's presentation that goes with this video.
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