EnergyTechStocks.com had a very interesting post on peak oil based on an interview with Charles T. Maxwell.
Maxwell spent 40 years on Wall Street, plus 12 years before that working for a major oil company, a lifetime of experience. Now a senior energy analyst at Weeden & Co., Maxwell is known as the “dean of energy analysts.” Princeton and Oxford-educated Maxwell has laid out in stark, uncomplicated terms what might be called the “Nightmare on Main Street.”
Some key points from the first of four posts in EnergyTechStock.Com:
- There is only about 1.2% more oil available each year, not enough to keep up with 1.5% annual demand growth.
- Between now and 2010, this supply shortfall will be made up through a drawdown in inventories, helped out by a slowdown in demand in 2008 and 2009 due to a recession or near-recession in the U.S.
- In 2010, the shortfall will become greater than can be made up by what’s still in inventory, thus beginning a period of global oil scarcity that will lead to a “peak” in conventional oil production in 2012 or 2013.
- It gets even worse in 2015, which is when he expects a peak in the production of all liquids, a category that includes condensates, tar sands oil and biodiesel.
- By 2025, “We can create some answers.” He explained that both plug-in electric vehicles and cellulosic biofuel are “wonderful ideas”; however, given that it takes 10 to 15 years or longer to turn over the world’s vehicular fleet, such technological breakthroughs won’t happen quickly enough to prevent the nightmare from happening.
In part 2 he forecasts $12 to $15 dollars a gallon gasoline "in a few years" with oil at $180 a barrel in 2015 and $300 a barrel in 2020.
Not too far from what I expect, based on a "virtual" consensus that I have created in my mind. I don't have any idea whether his price forecasts are anywhere near reality, as few will stick there neck out that far on prices. I know the long term trend is up and any short term decreases are just a blip in the trend.