Worried about Peak Oil? You might be 5 years too late.
In the last week, UK newspapers have been dominated by two pieces of news – the Royal Wedding and the death of Bin Laden – both picked over in meticulous detail plumped out with the filler that the press adds to abide to its ‘bigger story => more ink’ rule. As a result of all that attention, another much more important, if less sensational, story has been largely missed. The chief economist at the International Energy Agency told Australian TV last Thursday that we hit Peak Oil back in 2006 (source Irish Times).
Peak oil, for those who don’t know, is when the maximum amount of oil is being extracted. After the peak, oil production generally declines quickly (following the bell shaped Hubbert Curve), pushing prices up, particularly if demand keeps rising. The impact of this cannot be understated. Our entire modern economy is predicated on oil being cheap. If oil prices rise, so do the prices commodities like plastics, metals and food, never mind the price of petrol at the pump. At a time the world is recovering from a massive financial jolt, this could hurt. A lot.
Peak oil will drive change in a way that a less tangible threat like climate change cannot. Soaring prices will push energy efficiency and low carbon energy production to the fore. Saudi Arabia is reported to have recently invested $100bn in low carbon energy technologies (source FastCompany) – a nation built on oil, now looking to the sun. Maybe the rest of us – society, governments and industry – should take heed.