Peak Oil Come and Gone – What Lies Ahead?
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This is a somewhat startling revelation since only a year ago the IEA had predicted that the world would not reach peak global oil production for another decade.
In the new report, the IEA predicts that production from current oil fields will drop steeply in the coming decades, to less than half of their current rate of production by 2035. To keep supplies at their current levels, the report suggests that predicted new discoveries of reserves will need to make up nearly 40 million barrels a day by 2035.
Meanwhile, there will be increasing pressure on oil supplies thanks to industrialization of India and China, which will force prices up:
An Era of Growing Alternatives
The ray of sunshine in this gloom picture is that increasing demand for oil will increase prices, and increased prices for fossil fuel will make renewable energy ever more attractive. This is particularly hopeful since the other costs of oil are becoming more evident – the 2000s were the hottest decade on record, for example, and earlier this year we saw the risks of oil exploration all too clearly in the the Gulf of Mexico oil spill.
And while the report paints a fairly unsustainable picture of China, the blog BusinessGreen highlights GreenPeace findings that China may actually be leading the renewable energy revolution:
A recent report from Greenpeace predicted that oil firms and energy investors will find it harder to justify long-term investments in tar sands projects as the impact of global renewable energy and low-carbon initiatives leads to falling demand for fossil fuels.
“The idea that falling demand for oil in the EU and US will be offset by increased demand in China is increasingly open to question,” said a spokesman for the green group. “For example, you now see China giving its people incentives to buy smaller cars in a manner that is even more aggressive than the fuel standards in the US and Europe. Meanwhile, Obama’s recently introduced fuel-efficiency standards are expected to cut demand by a million barrels a day.”
What to Do in a Post-Peak World
The IEA’s report, like many other signals, says that we need to reduce our dependence on oil. Further, it suggests that if we aren’t able to reduce our fossil fuel use ahead of time, market forces will force us to. And the consequences of delay will be severe.
On a macro level, the IEA proposes a “450 Scenario,” a set of policies that will stabilize greenhouse gas emissions at 450 parts per million (ppm) of CO2-equivalent. By reducing coal-fired fossil fuel electricity generation with aggressive policies to promote electric vehicles and plug-in hybrids, we can both manage the effects of climate change and reduce the effects of the post-peak oil scenario:
For some ideas how to reduce your own dependence on fossil fuels see our tips: 9 Things You Can Do About the Gulf Oil Spill.