Doubts About Peak Oil

I read the term "peak oil" again and again. There are certain concepts that remind me of the hysteria around Y2K in late 1999. There was no arguing against it. We just had to wait. The supposedly imminent US or Israeli bombing attack on Iran that has been months away for years now is one example of a concept that gives me that feel. "Peak Oil" is another example.

Of course, the peak of available oil was the day before the first oil field was exploited. Since then, the amount of oil available has gone down continuously. So "peak" refers to some combination of technology and ease of extraction for oil and I think that is the point where this story that oil is going to run out soon goes wrong. Incidently, while this term "Peak Oil" seems new, the idea that oil would imminently run out has been coming and going for decades.

Technology advances exponentially. Period. That is a counter-intuitive concept but it is a lot more correct than either the Malthusian or the Peak Oil position that technology increases linearly while demand increases exponentially.

Moore's Law for microchip circuitry is an interesting example of technology advance. And semiconductor circuitry is a good candidate for the initial discovery of a more general technological Moore's Law because the generational cycle of semiconductors is so short. That cycle is viewable many times in a single person's career.

How it has worked has been that the amount of brainpower needed to double the amount of transistors on a single chip in a given time has gone up since the 1960's. But the amount of brainpower the world has been willing and able to allocate to transistors has also increased. So that it takes more to double the transistors in 24 months now than it did in 1975, but the necessary resources are available and will be devoted to that task.

How much brainpower will it take to double the efficiency or yield of oil extraction? Oil extraction technology does not cycle nearly as quickly or smoothly as semiconductor transistor technology, but the same basic process is in place. There are plenty of resources to train and allocate problem solvers of different types to the problem.

Increased demand from the developing world, starting with China and India, are going to increase the price of oil for the foreseeable future. But a point where the dynamics of the industry changes? A point where large supplies of oil go off line at or near the same time? That seems like just another hysterical position that cannot be argued with but that time will prove false.