The great oil party is coming to an end

Soaring oil prices have stirred a long-standing debate among experts about how much crude remains in the ground and how to manage the countdown to when the reserves run dry.
"We have all been enjoying the greatest party the world has ever seen: the great oil party," said Kjell Aleklett, president of the Association for the Study of Peak Oil, an informal network of scientists and oil experts which aims to make "the world aware that the party is over".
"Few of us have realized that it was a party, still less that it is now reaching its climax as the champagne corks pop on all sides," Aleklett said, making an analogy between oil and champagne. "After the climax comes the decline when we have to sober up and face the fact that the party is coming to an end," he said.

The association maintains that the peak after which oil production begins to decline is much closer than is commonly thought, standing somewhere between 2008 and 2010 for oil and 2013 for gas. These crucial dates, which would mark the beginning of an era of high energy prices, are particularly difficult to establish because of the quality and availability of the figures they are based on.
The definitions used also complicate the task of calculating when the oil supply will begin shrinking because of ambiguity over the definitions used by experts. For example, there is a difficulty in determining the difference between reserves, of which there are three kinds, and resources, which are considered less certain. Moreover, reserves change. Their levels have been steadily increasing over the past decades as new technologies are used to prospect, evaluate and recover crude.

Estimates for the peak of oil production vary widely in the industry from as soon as 2004 to as late as 2048, but the median date of 2020, based on the proven reserves of about 1.050 t barrels, is cited the most often. That would mean that production would remain robust until 2050, meeting half of energy demand. Under that hypothesis, oil would still be produced until the end of this century.
However, ASPO doubts the figures provided by producer countries and estimates proven reserves to stand at 878 bn barrels. Given the huge stakes involved, ASPO accuses governments and oil companies of withholding the truth because of unspoken political and economic motives. On the other hand, oil industry insiders suggest that ASPO members, who are often retired oil company employees and academics, use outdated technical and statistical methods.

Regardless the level of global oil reserves, the problem of their decline is real. That problem is exacerbated by the concentration of reserves in the politically volatile Middle East and steady growth in demand. The International Energy Agency estimates that the energy market could grow by two thirds by 2030 and has called for massive investments to meet the challenge. The recent climb of oil prices above $ 40 a barrel has so far not sparked much debate about how oil is consumed, although policymakers are worried about the economic impact of high oil prices.
French MP for the Green Party Yves Cochet said recently that "the imminent end of cheap oil is the most dire test that humanity has confronted" and the social consequences would be "devastating".