Just what is supposed to represent the "unidentified projects" wedge going forward? It's OK if you don't know; the question remains a mystery to the International Energy Agency too.
Ah well. ... enjoy:
The US military has warned that surplus oil production capacity could disappear within two years and there could be serious shortages by 2015 with a significant economic and political impact.
The energy crisis outlined in a Joint Operating Environment report from the US Joint Forces Command, comes as the price of petrol in Britain reaches record levels and the cost of crude is predicted to soon top $100 a barrel.
"By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day," says the report, which has a foreword by a senior commander, General James N Mattis.
It adds: "While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. Such an economic slowdown would exacerbate other unresolved tensions, push fragile and failing states further down the path toward collapse, and perhaps have serious economic impact on both China and India."
The US military says its views cannot be taken as US government policy but admits they are meant to provide the Joint Forces with "an intellectual foundation upon which we will construct the concept to guide out future force developments."
The chief economist of the International Energy Agency said predicted Tuesday that the "era of cheap energy is over," with oil supply unlikely to keep up with demand.
… he predicted that demand from the major industrialized countries comprising the Organization for Economic Cooperation and Development has peaked.
"They are not anymore the drivers of oil demand, unlike in the past," he said.
Birol said he has "serious worries" about whether future supply can meet demand.
With investment down and production declining, even if global demand remains around 85 million barrels a day by 2030, about 45 million barrels a day worth of new oil would have to be found to compensate for falling output at existing fields, he said.
The Paris-based IEA is the energy watchdog for the major industrialized nations.
By Chris Nelde, Energy & Capital
Friday, April 16th, 2010
In the first part of this series, I reviewed a series of reports from March supporting the peak oil view, and warning that world oil production very well may go into terminal decline by 2015 or sooner.
The sources included the UK Industry Task Force on Peak Oil and Energy Security and officials within the British government; researchers within the College of Engineering and Petroleum at Kuwait University; researchers from Oxford University; and ConocoPhillips, the third-largest oil company in the U.S.
On March 25, the U.S. Department of Energy (DoE) joined the officially worried, with a report in French newspaper Le Monde titled "Washington considers a decline of world oil production as of 2011."
... The EIA has no idea how production could increase after 2012. In the absence of these "unidentified projects," they expect global oil supply to decline by about 2% per year - from 87 million barrels per day (mbpd) in 2011 to 80 mbpd by 2015 - while demand rises to 90 mbpd.
Within five years, then, there will be a 10 mbpd gap between supply and demand—roughly a Saudi Arabia's worth of production (currently 10.8 mbpd).
Sir Richard Branson and fellow leading businessmen will warn ministers this week that the world is running out of oil and faces an oil crunch within five years.
The founder of the Virgin group, whose rail, airline and travel companies are sensitive to energy prices, will say that the coming crisis could be even more serious than the credit crunch.
"The next five years will see us face another crunch – the oil crunch. This time, we do have the chance to prepare. The challenge is to use that time well," Branson will say.
"Our message to government and businesses is clear: act," he says in a foreword to a new report on the crisis. "Don't let the oil crunch catch us out in the way that the credit crunch did."
Other British executives who will support the warning include Ian Marchant, chief executive of Scottish and Southern Energygroup, and Brian Souter, chief executive of transport operator Stagecoach.
The world's oil reserves have been exaggerated by up to a third, according to Sir David King, the Government's former chief scientist, who has warned of shortages and price spikes within years.
The scientist and researchers from Oxford University argue that official figures are inflated because member countries of the oil cartel, OPEC, over-reported reserves in the 1980s when competing for global market share.
Their new research argues that estimates of conventional reserves should be downgraded from 1,150bn to 1,350bn barrels to between 850bn and 900bn barrels and claims that demand may outstrip supply as early as 2014. The researchers claim it is an open secret that OPEC is likely to have inflated its reserves, but that the International Energy Agency (IEA), BP, the Energy Information Administration and World Oil do not take this into account in their statistics.
by Smith School of Enterprise and the Environment
“The Status of Conventional Oil Reserves – Hype or Cause for Concern?” published in the journal Energy Policy concludes that the age of cheap oil has now ended as demand starts to outstrip supply as we head towards the middle of the decade. The report also suggests that the current oil reserve estimates should be downgraded from between 1150-1350 billion barrels to between 850-900 billion barrels, based on recent research.
Dr Oliver Inderwildi, Head of the Low Carbon Mobility centre at the Smith School, said:
“The common belief that alternative fuels such as biofuels could mitigate oil supply shortages and eventually replace fossil fuels is a pie in the sky. There is not sufficient land to cater for both food and fuel demand. Instead of relying on those silver bullet solutions, we have to make better use of the remaining resources by improving energy efficiency. Alternative such as a hydrogen economy and electric transportation are not mature and will only play a major role in the medium to long term.”
Nick Owen of the Smith School of Enterprise and the Environment added:
“Significant oil supply challenges will be compounded in the near future by rising demand and strengthening environmental policy. Mitigating the oil crunch without using lower grade resources such as tar sands is the key to maintaining energy stability and a low carbon future.”
The Smith School paper also highlights that in the past, political and financial objectives have led to misreporting of oil reserves, which has led to contradictory estimates of oil reserve data available in the public domain.
Sir David King, Founding Director of the Smith School, commented:
“We have to face up to a future of oil uncertainty much like the global economic uncertainty we have faced during the past two years. This challenge will have a longer term effect on our economies unless swift action is taken by governments and business. We all recognise that oil is a finite resource. We need to look at other low carbon alternative."
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“And, you know, interestingly enough, you're seeing the Saudis make significant investments both in their own country and outside of their country in clean energy, as well, because I think they recognize that we've got finite… we have a finite supply of oil.”
