When Oil Peaked [Hardcover]

Having read Dr. Deffeyes' previous titles, Hubbert's Peak and Beyond Oil, I enjoyed this new title but was disappointed by a lack of depth. It carries the story forward to 2010, with updates on new developments like the breakthrough in U.S. shale gas production that occurred around 2004, and the economic tumult that followed the 2008 oil price spike. The author predicted that global oil production would peak in 2005, and figures so far have borne him out.

Dr. Deffeyes gives some intriguing inside information from the oil industry. In the heyday of oil exploration, about 1956, there were about 9,000 exploratory "wildcat" wells around the world; by 2005 the figure was down to 2,500. The author admits that his data come from "an unpublished, unverifiable data set." Welcome to the oil business: there is a veil of obscurity, since oil production and reserves are corporate and national secrets. But there's more evidence: the "majors" of oil production, companies like Exxon, Shell and BP, began shrinking their research budgets after about 1980, and also began buying back their stock rather than investing in exploration. Most of the world's oil reserves lie in the hands of national oil companies in places like Russia, Saudi Arabia, Brazil and Mexico.

There have been two big new recent finds, both offshore, off the coast of Brazil and in the Gulf of Mexico. Huge as the Brazil "subsalt" find is, sizable production is at least a decade away. Drilling in the Gulf of Mexico has, er, "gummed up" a bit after the Deepwater Horizon disaster. Neither is likely large enough to offset the overall decline in global oil production.

One of this title's most useful additions is a graph on p. 40 that compares U.S. oil costs as a share of GDP from 1950 to 2010. The cost of oil has hovered in the 1-to-2 percent range most of the time, including the "SUV boom" of the 1990's, but around 1980-82 and in 2008 it exceeded 6 percent. Deffeyes claims, validly I think, that our 2008 financial crash and subsequent recession were really byproducts of soaring fuel prices, but fails to back up his case. He argues in favor of price supports, to encourage companies to undertake the risks of oil and gas exploration in a world of volatile energy prices. What makes good policy is not good politics, and he wisely avoids the "political feasibility" question.

The author concludes by looking into ways to bridge the gap between declining oil reserves and renewable power sources of the future. Coal gasification may have a future not automatically tied to cultures with racial-superiority complexes like Nazi Germany and South Africa. Nuclear power is less dangerous than the public thinks, and radwaste burial is safer than people realize. Natural gas from organically rich shale rocks, while finite, will also help. The author's discussion of climate change is concise and interesting, if a bit shallow. Yet he may be right that geo-engineering will be the ultimate solution.

I can't recommend this author's former titles, Hubbert's Peak and Beyond Oil, highly enough, for anyone with an interest in our energy future. When Oil Peaked is a useful addition, but slightly thin: just 136 pages compared with about 190 each for the former titles. It is nonetheless an affordably-priced addition of fun reading and intriguing insights from an author who has made a compelling case that global oil production is already declining, and our energy-rich lifestyle is changing before our eyes.

I have read Deffeyes' books, Hubbert's Peak and Beyond Oil, and HIGHLY recommend his previous books as highly informative and insightful, perhaps the among the most important books I have read in the last 10 year, but this new book adds little to the discussion. It seems to ramble and is not very coherent in making any point. Deffeyes' also wanders into climate science, interpreting all climatology, including 100 year trends, in terms of geology on million year time scales.

In the end, if you have not read his previous books, READ THOSE. If you have read those, there are likely other books on the topic worth reading. This is a quick read because it is so short, but I can't say that I recommend it.

Deffeyes is sort of the unofficial intellectual heir to M. King Hubbert's ideas on peak oil. In some of his earlier books, he applied these ideas to the worldwide oil situation and came up with the prediction that worldwide production would peak in the year 2005. He is one of the most oft-quoted authorities on the matter and he gets his authority status both from having been a former colleague of Hubbert and from being an expert in petroleum geology himself. As such, I was highly interested in reading this book which has come out five years after his predicted date for global peak oil. While the book does cover the issue of peak oil, it comes off more as an ad hoc collection of the author's views and ideas on a broad range of topics directly and indirectly related to peak oil including the production of natural gas and precious metals, global warming, the prospects for future energy production and the stock market. Some of the ideas carry the weight of expert opinion while others are little more than layperson guesses. Much of what he says is both interesting and in line with what other authors suggest on various topics; however, there are a couple of shortcomings in my mind. First, some of his musings come very close to being technical observations that might be unclear to people who don't have a background in what he is talking about. Some of his points seemed unclear to me and I felt like I would have to have been an expert or a student in his area of expertise to know instinctively what he was talking about. This is especially true for some of his characterizations of oil production and the charts he provides. The book is very short and I felt like here and there he could have dedicated a bit more space to fleshing out his comments for lay readers. Second, by mixing observations about oil production for which he is genuinely an expert with observations about global warming, the stock market or nuclear energy for which his obviously not an expert, he runs the risk of have people give equal weight to all of his ideas. I am very inclined to believe he's on the right track with his predictions about oil production but I'm not so sure his observations about global warming are worth the paper they are written on. Overall, I have to give the book a moderately positive rating as it is full of interesting ideas and observations that many people may not have seen before and it certainly gives the reader many ideas to ponder. I just wish more effort had been spent in better organizing and developing some of the ideas so they formed a more coherent whole rather than sounding like a checklist of all things this important author has thought about over the last 5 years.

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