The Denizens of Peak Oil Denial

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By Steve Andrews and Randy Udall

(Note: Commentaries do not necessarily represent the position of ASPO-USA)

Last week Michael Lynch and Daniel Yergin pummeled the concept of peak oil in two mainstream media outlets. Lynch’s feisty but nearly fact-free op-ed for the New York Times and Yergin’s more scholarly reflection in Foreign Policy whipped up further discussion in the blogosphere. Although the majority of on-line responses to Lynch’s piece were negative, peak oil advocates were put on the defensive.

The two critics employ distinctly different styles—Yergin is a Pulitzer Prize-winning historian and suave, savvy corporate schmoozer, while Lynch resembles the kind of pit bull that enjoys attacking bicyclists from behind. Both have been pounding away at peak oil since its “modern renaissance” began with the March 1998 article in Scientific American, “The End of Cheap Oil.” These two masters of denial enjoy flogging peak oil. It’s clearly what their paying clients in Big Oil want to hear, and sometimes the peak oil community inadvertently hands them ammo that is too good to pass up.

Yergin’s case is somewhat perplexing. His shop (Cambridge Energy Research Associates—CERA) talks a good game about the need for a “rational discourse” about peak oil, and indeed CERA has published graphics in the past two years that clearly show crude-and-condensate production peaking. But in his Foreign Policy piece, Yergin once-again dredges up the tired notion that peak oilers claim “we’re running out of oil” (only an unfortunate few still use that framing). He crows that if access were no problem, and pigs could fly, world reserves could support substantial growth in production, and that Canadian tar sands and OPEC natural gas liquids are the cavalry that will rescue the day.

Although Lynch’s oil price forecasts over the past few years have been ludicrously erroneous, in his op-ed he has the chutzpah to list some 14 flaws in peak oil analysis. While a few of the criticisms hit the mark, most are just rhetorical head banging. A full counterpoint of Yergin and Lynch is beyond the scope here. Instead, we’ll highlight two points. It isn’t about “running out;” it’s about “the flows”

World oil production grew eight-fold between 1945 and 2000. The peak oil story is about our inability to sustain that trend. Today’s modest “excess” of oil supply—the result of shrinking demand due to the global recession plus Saudi investments—may last another year or two. But in the background resource nationalism, credit constraints, reduced drilling, armed conflict, and regional geological limits are kicking in hard. By 2012, global production will be downshifting into reverse, with a larger world population forced to divvy up a shrinking supply.