A response to Robert Bradley

I just wrote a response to Robert Bradley about peak oil. It turned out to be longer than I expected, so I decided to copy it here and link you back to his post. 

The post is hard to digest for somebody like me. I worked 40 years in the oil and gas industry, retired recently, and therefore I come at the "peak oil" issue from the inside. 

Bradley's post is here: https://www.masterresource.org/peak-oil-fixitydepletion/no-peak-lynch/#comment-50191

Approximately 25 years ago I was asked to look at industry exploration results in the previous 10 years, the pace of technology development, and  political changes such as the fall of the USSR. Our conclusion as a group was that exploration for oil was a very low return business, there was a need to high grade the effort, and reduce staff and investment. 

My personal conclusion was that we were clearly entering a phase where exploration wouldn't replace production. The corollary was that we needed to focus on capturing hydrocarbon molecules in the ground, which could be held under contract for the future, and wait as technology and higher oil prices allowed us to develop them. This however was my minority opinion. 

As the years have gone by, I have seen nothing to change my mind: we are depleting the easy to get oil, and are having to exploit low quality rocks and fluids, often located in incredibly difficult places. I'm not a "peak oiler" as such. I've simply reached the conclusion that we, as an industry, will demand ever increasing prices to satisfy the market. And these prices are gradually reaching levels which enable competitors to emerge (such as hybrid plug in vehicles and Brazilian biofuels). 

I can't debate here whether the global warming issue is really as bad as they say. I think it's sufficient to acknowledge there's enough people convinced it's a problem to create a competitive environment for subsidized replacements. This means there is an emerging replacement for oil, which relies in part on subsidies, but which can erode some of oil's market share. 

When I add all these factors, I have to conclude that peak oil is indeed approaching, but I'm afraid it will come in a chaotic, oscillating oil price environment, with an overall rising trend. 

One conclusion seems to be that peak oil will happen when the oil price dips slightly, which discourages industry activity, and that prices will rise after peak oil, but the industry will no longer have the means to satisfy demand. Thus the rising prices will have to trigger substitutes, or else the world economy will be in trouble. I don't think the peak we saw a few months ago is THE peak. But I'm afraid the peak will come within 10-20 years, and we won't be prepared for it. 

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