One of the features of many models that are used to predict future events is that they focus on target years. Decadal years are the most common target years, so that whether talking of climate or the amount of oil or natural gas available, models focus on, for example, the amount that will be available in 2030. The problem with this approach is that it leaves the public to think that a problem is not yet serious. For example if the prediction is that the production of oil will only be 75 mbd, in 2030 then there is an implication that until 2030 that the situation will remain fine.

However the world does not reach those levels by continuing in the business as usual mode for the next 21 years, and then suddenly have production drop off a cliff one Friday night. Rather it is a problem that inexorably will grow, year on year, between now and then. I was struck by this thought as I looked through the latest comments from CERA/IHS on their view of the future of oil supply. Their view, as we have come to expect, is an optimistic one, and though we are not still living in the days of $30 oil that they had, at one time predicted, it is worth looking into so as to provide some explanation of the difference between their view and mine.

Yesterday's Guardian raised questions about whether oil reserves published in the past by the IEA have been inflated.

Key oil figures were distorted by US pressure, says whistleblower

The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.

"Peak oil can be a very tricky topic, the way I talk about it and deal with it at the end of the day is: We need to revolutionize the way we consume and produce energy... We need to really be the leaders in saying: the future for our children and our grandchildren as far as energy consumption and as far as production, it looks like this" with those words Colorado Governor Bill Ritter started his closing speech at the ASPO conference in Denver that took place from 10 to 12 October 2009.

Telling our children and grandchildren where they will draw their heat, electricity and liquid fuels from was not a topic of discussion in Denver. Nonetheless, much information was conveyed on the relationship between the economics crisis and the future of oil. This post is an attempt to summarize the main points on oil and the economy from the conference presentations--concluding that there are three distinct future trajectories as we go forward.

At the Denver conference, world oil production was discussed from both the supply side (what flow rate can be reached) and the demand side (how much can the economy afford). It is really the combination of the two that is important--so I bring together both in this post.

This is a repeat of JoulesBurn's post on Abqaiq from May 2008, which may be of interest to those reading Heading Out's post. -- Gail

Abqaiq, an aging super giant Saudi Arabian oil field, has yielded over 11 billion barrels of oil since it was discovered in November of 1940. Its past provides us with the poster child for easy oil. The first well flowed at 9720 barrels per day, a far cry from today's land finds where multiple horizontal laterals are necessary to coax lesser quantities from stingier reservoirs. But Abqaiq's more recent past paints a more muddled picture, as efforts to extract the remaining oil have produced mixed results. More advanced recovery methods have been successfully employed in some parts of the field, but these have likewise revealed unexpected geological complexities which have in turn hindered recovery in other areas. Many of the new challenges encountered in Abqaiq are relevant to the future prospects for other fields, particularly Ghawar and Khurais. This article will evaluate the development status of the field using satellite imagery to identify recent drilling in correlation with several recent technical reports on new developments and strategies for maintaining production.