Even though ExxonMobil never will use the word Peak Oil they have in fact used it by saying that the production will stay flat to 2012. Another problem that Exxon and the other majors have is that they cannot replace the yearly produced oil win new oil reserves. Instead they talk about oil equivalence. This was shown in the thesis of Fredric Robelius (http://publications.uu.se/abstract.xsql?dbid=7625) from the Global Energy Systems group (http://www.tsl.uu.se/uhdsg/) at Uppsala University in Sweden, Page 115: “To summarize, the four largest private oil companies have not succeeded in increasing neither production nor reserves despite an increase of the oil price and increased investments in exploration and production.”

The article about ExxonMobil can be found in Business Week (http://www.businessweek.com/bwdaily/dnflash/content/mar2008/db20080319_269345_page_2.htm)

During March and April we normally have a peak in the oil price and this year is no exception. What we just now experience is that the price looks to stabilize above $100. During the summer we can expect a decline and it will b e interesting to see if we will land below $100. The next time we can expect an increase is in September, October and it will be interesting to see the roof then.

Information about energy prices March 18 was given by Oil&Gas Journal:

After losing $4.27/bbl in the previous session, the April contract for benchmark US light, sweet crudes regained $3.74 to $109.42/bbl Mar. 18 on NYMEX. The May contract escalated $4.27 to $108.50/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was up $3.74 to $109.42/bbl. The April contract for reformulated blend stock for oxygenate blending (RBOB) jumped 15.58¢ to $2.66/gal on NYMEX. Heating oil for the same month gained 6.95¢ to $3.14/gal.

The April natural gas contract shot up 31.4¢ to $9.41/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., lost 51¢ to $9.09/MMbtu.

As the last speaker in the House on March 14th, Congressman Roscoe Bartlett, rose to speak about Peak Oil, marking the anniversary of his first special address on Peak Oil three years ago; “Mr. Speaker, I think this is probably the 40th time I have come here, because this is the third anniversary of the first time I came here, which was on March 14, exactly 3 years ago.”

A special guest sat in the gallery; “Well, this is a very special day for me today because I have a very good friend, Kjell Aleklett. He is from the Uppsala University in Sweden, and he is the president of ASPO, the Association for the Study of Peak Oil&Gas. They have been around for a long time, and if the world had been listening to them, we would not have $110 oil today. And I think you will agree with me as we go through the charts, that this would be correct. He sits in the gallery, and thank you, sir, very much for joining us.”

In the end of February and beginning of March a series of new oil price record was reached. A quick look back gives such events as: “On Feb. 28, the April contract for benchmark US light, sweet crudes shot up to a record $102.97/bbl in intraday trading on the floor of the New York Mercantile Exchange before settling at a record closing of $102.59/bbl, up $2.95 for the day. “, “The May contract jumped $2.87 to $102.25/bbl.”, “On the US spot market, West Texas Intermediate at Cushing, Okla., was up $2.95 to $102.60/bbl.”, “Heating oil for March delivery escalated by 7.45¢ to $2.85/gal on NYMEX. The March contract for reformulated blend stock for oxygenate blending (RBOB) advanced 1.8¢ to $2.50/gal.”

The last week was no different and meant even new price records for a barrel of oil, over 110 dollar/barrel. The latest record was a flirt with 112 dollars/barrel (Upstream). Some claim this is a result of the weakened dollar and this might be a part of the explanation, however the oil price has risen significantly in euros too. Other see this as a sign of an even tighter oil market.

We who work with the modeling of future production of oil know the importance of reserves. Colin Campbell, founder of ASPO, has an interesting story to tell about the origin of the database that CERA uses and clams to be the best. The story indicates that IHS and CERA are managing data that might have been collected in dark allies and smoke-filled rooms. This is the story of Petroconsultants.

Kjell Aleklett, President of ASPO

PETROCONSULTANTS

By Colin Campbell, founder of ASPO.

Naturally an oil company has every reason to track the activities of its competitors which can have much commercial significance. In earlier days in the United States, they used to employ people known as "scouts" who would keep rigs under observation, sometimes with binoculars. They could for example count the stands of pipe being removed to figure out how deep the well was. Also they could hang around bars and talk to drillers having a beer. In the early days of the North Sea, oil companies placed observers on trawlers to watch rigs and if possible listen in to radio communications in the best traditions of scouting.

2008 March 6: “From the steps of the Supreme Court to the White House press room, from global trading exchanges to the snowy reaches of Alaska — over the last week, you could hear the creak of history as it began to pivot in a half-dozen locales. The Age of Oil is at an end. Maybe not this year. Maybe not for five years. But signs of the coming collapse are evident.”

This is the beginning of an article in New York Times by Timothy Egan, who worked for 18 years as a writer for The New York Times. In 2006, Mr. Egan won the National Book Award for his history of people who lived through the Dust Bowl and in 2001 he won the Pulitzer Prize as part of a team of reporters who wrote the series How Race Is Lived in America.

Read “Oil’s End” in New York Times, http://egan.blogs.nytimes.com/2008/03/05/oils-end/

Press release from ASPO, The Association for the Study of Peak Oil&Gas, www.peakoil.net

2008-03-05

ASPO and Peak oil theorists challenge Saudi Arabia

Kjell Aleklett, President of ASPO, www.peakoil.net, +46-70-425 0604

In Paris, March 2, 2008, Ali al-Naimi, oil minister for the world's largest crude producer, Saudi Arabia, and one of the oil industry's most influential figures, has been discussing Peak Oil. He has stated that Saudi Arabia, which already has the world's biggest proven oil reserves, plans to add another 200 billion barrels of oil to its proven reserves. He said this was "to reassure the world that we are not going to run out of oil in the next five to ten years as peak oil theorists say." Full story at AFP

In The Indepent on Sunday, March 2, 2008, Dr Fatih Birol, chief economist at the International Energy Agency, give his outside view about future oil: “We can't cling to crude: we should leave oil before it leaves us”.
Some statements from the article: “Oil production by public companies is reaching its peak. They will have to find new ways to conduct business.” “Middle East, … it is not certain that they are ready to increase production to meet growing world demand.” “ ….. perhaps oil at $150 a barrel by 2030.” “ ……… we are running out of time.”

View the article from Independent here.

A new book on peak oil has been released in Arabic. The title is “Oil, peak production and the consequence of decline” and the author is Hatem Elsayed Hany Elrefaai from Egypt. The book offers a overview of the problems related to peak oil and fossil fuel depletion along with potential impacts on the society.

It is good to see that the question of peak oil is being discussed in the Arabian countries, especially since they control the vast majority of the known remaining oil reserves. Given the major dominance of oil in many Arabian economies a more strategic thinking and discussions about the future are of importance to tackle the problems imposed of depletion.

In total the book has 200 pages, 18 figures, 23 tables, 68 references and one appendix with 7 tables. The book is built around 7 chapters, each discussing various aspects of the problem and related questions. Briefly the outlook of each chapter is as follows:

The industries for production of Motor Vehicles and Airplanes are the industries that more then others dependent of future oil production. Today an environmental agenda can bee seen for the players and the industries try to have CO2 reduction as one of the driving lines for future production. When it comes to Peak Oil we have a completely different picture. Looking through different documents regarding future fuels we find that there is only one company that have Peak Oil as part of the agenda and that is Volvo Trucks in Sweden. In the document Future Fuels for Commercial Vehicles they state: “Global oil production will probably peak within a decade and the time of cheap and abundant oil will be over.”

Their document can be found from here:
Future Fuels for Commercial Vehicles

Watch Volvo presentation from an ASPO-conference here

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