January 05, 2011

TheOilDrum agrees - new monthly peak in liquid fuel production and soon a new peak in monthly oil production

TheOildrum, perhaps the most popular peak oil web site, has an article by Stuart Staniford that agrees with my reading of the IEA report that there is a new monthly high in liquid fuel production and likely near term prospects for oil production are for higher oil production.

My article on the IEA world oil supply report scooped them by one day.

Stuart indicates:
Both the IEA and OPEC came out with new monthly reports recently. And both report that oil production in November 2010 exceeded the previous high month of July 2008 (back when oil was over $140). Probably the difference is within the margin of error, and in any case the third agency (the EIA) won't weigh in for a few months.



A significant point: not peak monthly oil just yet. As long as there isn't a massive financial crisis in the next few months (which is what happened to the last global high in oil production) I imagine we'll clearly exceed the July 2008 peak production. In particular, the point I first made here still holds: the increases in the last eighteen months have largely come from non-OPEC production rather than OPEC, and the latter undoubtedly still have some spare capacity that can be released (at a price). Thus production can and will go somewhat higher as long as demand continues to increase, which will be true as long as the global economy doesn't hit another big pothole.

The bottom line is this: those people running around saying that the all-time peak in monthly oil production was definitely in 2005 or 2008 are running a considerable risk of having events make fools of them. Appropriate caveats should be used.

The new peak in liquids was set in November and there is another 300,000-400,000 barrels of oil per day from Iraq as of this week (an increase since the end of November). So January, 2011 should have a new peak in oil and not just liquid fuels (which includes biofuels and natural gas liquids).

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