No More Oil? A Charity Gives New Life to 50-Year-Old Prediction of Falling Supply

Oil was created by specific geological forces bearing down on decaying organic matter over hundreds of thousands of years.

With the world now

burning through 85 million barrels of the black liquid a day, a question emerges: How much is left?

For answers, one nonprofit organization is looking back 50 years to the “peak oil” theory that was first developed by the geophysicist Marion King Hubbert.

The Association for the Study of Peak Oil and Gas-USA, a Denver nonprofit group, was founded in 2005 by Steve Andrews, an engineer and energy consultant, to predict the future of oil and natural-gas supplies and raise the alarm about what its officials see as a looming energy crisis.

Although some in the oil industry discount Mr. Hubbert’s theories, the scientist is a hero to Mr. Andrews and his colleagues. In 1956 Mr. Hubbert developed his mathematical theory for calculating and charting oil depletion, and used it to correctly predict that the amount of oil produced in the continental United States would peak — reach maximum output — between 1965 and 1970 and then undergo a largely uninterrupted decline, year after year. The resulting rise and fall formed a bell curve, now dubbed “Hubbert’s Peak.”

Mr. Andrews’s organization, known as ASPO-USA, joins similar “peak oil” groups formed by scientists, investors, and concerned citizens in 10 other countries around the world to apply the Hubbert’s Peak projection in the United States to oil production worldwide. They all conclude that the industrialized world’s ever-increasing demand for oil is in for a rude shock.

His group now predicts that the peak of oil production for the world will occur between now and 2015, Mr. Andrews says. “This presents a serious problem with huge implications for the U.S. economy,” he says. “We cannot continue into the future as we’ve done through the past simply relying on ever more energy to run our economy.”

End of ‘Easy’ Fuel

While the group’s message sounds dire, the world is not running out of oil, Mr. Andrews stresses. Rather, his group believes the planet is running out of “easy” oil, which can be readily pumped from large, accessible oil fields.

Indeed, when the world reaches its peak oil production, it may have only burned through half of the total supply. The remaining oil, however, is in small fields, often in difficult-to-reach locations (such as deep underwater or in politically unstable countries), making it much harder to pump. Production from these diminished sources won’t be able to keep up with soaring global demand, the group says.

It is widely acknowledged that for the past 20 years, people have used more oil each year than has been discovered. Indeed, last year two barrels of oil were used up for every new barrel discovered underground.

“You can assume that gas prices will go through the roof,” Mr. Andrews says of what to expect as the world slides down the backside of Hubbert’s Peak. “People will feel badly ambushed by this when it happens.”

But high prices at the pump may be the least of the worries. Mr. Andrews says an oil-supply crunch could have an unpleasant impact on “civil society,” with the potential for violence, both on a local level and on a national and international scale. Some of the more strident peak-oil adherents predict widespread economic collapse and even massive famines in the wake of diminished oil production.

Mr. Andrews’s charity doesn’t dwell on such matters.

“We don’t spend as much time talking about the implications of the energy problem and leave that to a number of other groups,” he says. “We are more interested in informing the public about the scope of the problem and then helping identify potential pitfalls with the responses.”

Mr. Andrews says there is no “magic bullet” to solve the looming energy crisis, adding it will require a “smorgasbord” of solutions, including more conservation of existing oil and greater use of biofuels and other alternatives.

Shoestring Budget

The all-volunteer association has raised about $160,000, mostly from private donations of $250 or less, and conference registration fees. Mr. Andrews says he hopes to appeal to foundations for grant money to extend the charity’s public-education and analysis work.

The charity’s outreach efforts include a Web site, weekly e-mail bulletins to some 3,000 subscribers, and a newsletter.

More than 500 people attended the group’s second annual World Oil Conference, held last fall in Boston, in conjunction with Boston University. The two-day event featured more than a dozen scientists, professors, and politicians holding forth on the potential for oil production to hit its peak in the near future. A third conference is scheduled to be held in Houston in October.

Mr. Andrews says he has personally given at least 100 presentations to civic and corporate groups across the country, and his organization has briefed members of Congress.

The “peak oil” theory does seem to be gaining some traction. The former vice president Al Gore and the billionaire oil investor T. Boone Pickens are among the prominent people who have recently said that global oil production may soon be peaking.

Rep. Roscoe Bartlett, Republican of Maryland, gave an hourlong presentation in Congress in 2005 on the theory and co-chairs a Congressional caucus dedicated to the concept that oil is reaching its peak of production soon. (Mr. Pickens spoke at the last ASPO conference, and Mr. Bartlett submitted a video presentation.)

“We would shut down the group if peak oil became an accepted concept, a reasonable time frame for its occurrence was acknowledged, and people were moving forward with more intelligent responses to the problem,” Mr. Andrews says.

He says the concept remains largely a “fringe” issue in the larger energy debate. However, he draws hopeful parallels between it and global warming, now a near universally accepted concept that was debated and dismissed for years. “Decision makers at the highest levels are referring to global warming on an almost daily basis,” Mr. Andrews says. “We’d like to see such active discussions for peak oil.”

Raising Objections

At present, peak-oil skeptics abound. ExxonMobil, one of the world’s largest oil companies (and one that made record profits last year), placed an advertisement in major newspapers last year stating, “A peak will not occur this year, next year, or for decades to come,” and concluded that “peak production is nowhere in sight.”

Rex W. Tillerson, chief executive of ExxonMobil, responded to what he called the “so-called peak oil” theory in March in a speech before the Council on Foreign Relations, in New York, calling oil “far from finished” and stating that “abundant supplies exist to be tapped.”

“It seems that these folks are getting worked up over a problem that simply doesn’t exist,” says Max Schulz, a senior fellow at the Manhattan Institute, a New York think tank, and a former policy adviser at the U.S. Department of Energy.

Mr. Schulz says those who warn of grim scenarios fail to account for new oil exploration and drilling technologies, as well as the potential for oil extraction from unconventional sources, such as the oil sands in Canada. As technology marches on, he says, oil is “not the sort of thing we have to worry about for the next few decades or even through the century.”

Mr. Andrews acknowledges that future technological advancement could stave off the peak, but, he argues, “we shouldn’t have a faith-based energy policy.”

He does admit that the peak-oil cause, however, has a “boy who cried wolf” stigma about it. Mr. Hubbert, who died in 1989, predicted that oil production globally would hit its peak in 1995, yet production has steadily grown since then.

“If the peak is not here now, it’s coming soon enough that we should be acting on it,” says Mr. Andrews. “The adjustments it requires will take time, energy, resources, and brainpower.”

“Eventually,” he adds, “the wolf shows up at the door.”