We've all heard the term, usually in connection with dire predictions of the imminent collapse of "civilization as we know it". In fact, in those dismal pronouncements that pass for profound analysis, "peak oil" is usually up there with death and taxes as one of the great, inescapable realities of life.
Oil production has reached the top of the bell curve. From now on it's downhill all the way, to a world of grim subsistence. Better take a crash course in growing carrots, stockpile supplies of double-sided toilet paper, and hightail it to the nearest wilderness with a select group of gun-toting Survivalists.
Then along comes spoilsport Daniel Yergin of Cambridge Energy Research Associates who says that, actually, things aren't that bad. And to make matters worse, he comes with credentials that suggest, even to the most ardent doomsayer, that he knows what he is talking about. He is the author of two books on energy — The Prize: The Epic Quest for Oil, Money, and Power and The Quest: Energy, Security and the Remaking of the Modern World — and the holder of honorary doctoral degrees from Colorado School of Mines, the University of Houston, and the University of Missouri.
The first book won Yergin a Pulitzer Prize, and launched him as a public speaker with the rare ability to make economic issues accessible to the layperson. His message is that Survivalism — the retreat from a complex present to a supposedly simple past — represents a failure of the imagi-
nation, a refusal to respond creatively to changing times. It also reveals a failure to read history aright. For the pattern of the past is one of recurring resource crises, either real or imagined, acting as spurs to innovation and invention. This is especially true in the field of energy, where technology keeps opening new doors in totally unexpected ways. (See The Quest World Energy Timeline.)
Late last year, the International Energy Agency predicted that, thanks to the shale revolution, the US would overtake Saudi Arabia and Russia to become the world's largest oil producer by the second half of this decade. A startling prediction for those long captive to what Yergin calls the "pervasive sentiment that American oil's days were coming to an end".
"Instead," as he writes in an article in the Financial Times, "US oil output has risen 25 per cent since 2008 and the IEA estimates it will increase a further 30 per cent by 2020, to 11.1m barrels per day. US petroleum imports have fallen from 60 per cent of consumption in 2005 to 42 per cent today." (See US energy is changing the world again.)
What all this means is that the chimera of American energy indepen-
dence could soon take its first tentative steps into the realm of reality. It's certainly a prospect that takes some getting used to, after decades in which the routine rhetoric from the podium about lessening the nation's dependence on overseas energy supplies elicited little more than polite yawns. Sure, It was a worthy objective, but it wasn't going to be achieved. Everyone knew that — or thought they did.
So what caused the turnaround? The answer, of course, is a series of technological developments, facilitated by higher fuel prices. Par-
ticular mention should be made of hydraulic fracturing and horizontal drilling — two developing technologies that were successfully
combined to spark the shale revolution touched on above. "In a decade, shale gas has risen from 2 per cent of US natural gas production to 37 per cent," Yergin writes. As a result, "the US has overtaken Russia as the world's largest natural gas producer."
Even if the reader of Yergin's books remains unconvinced by some of his arguments, he or she will be forced to admit that The Prize and The Quest are the work of a "master storyteller" (to quote one reviewer) and that the story he tells is epic in scope. The broad perspective he brings to the whole issue of energy production and consumption, as well as his affable optimism, will at least ensure that jeremiads about the collapse of civilization no longer win such easy acceptance. — Alan Ireland, Palmerston North, New Zealand. February 10, 2013