Oil: This Time it’s Different

There is a harrowing and fascinating piece on “peak oil” — the point at which oil reservoirs can no longer produce increasing amounts of the stuff — in today’s N.Y. Times Magazine. Whether you’re an oil optimist or pessimist (and there are legitimate reasons to take either position), the piece is well worth reading.

Writer Peter Maas also retails some good quotes, some of which I’ve heard before but bear repeating:

”The world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions (wood to coal and coal to oil) were gradual and evolutionary; oil peaking will be abrupt and revolutionary.”

And this well-known one from Sheik Ahmed Zaki Yamani, the Saudi oil minister during the 1970’s:

”The Stone Age didn’t end for lack of stone, and the oil age will end long before the world runs out of oil.”

And this one from Daniel Yergin of CERA:

”This is not the first time that the world has ‘run out of oil’. It’s more like the fifth. Cycles of shortage and surplus characterize the entire history of the oil industry.”


  1. Copy the link below and it into your browser from a transcript of an interview with Mr. Simmons from Financial Sense Online. Enjoy.