Trends In Oil Supply And Demand The Potential For Peaking Of Conventional Oil Production And Possible Mitigation Options

Recent events and analyses have suggested that global production of oil might peak sometime within the next few years to the next one or two decades. Other analyses, however, conclude that oil supply can meet global demand for some decades to come and that oil production peaking is much further off. To explore this issue, the NRC held a workshop, funded by the Department of Energy, bringing together analysts representing these different views. The workshop was divided into four main sessions: setting the stage; future global oil supply and demand balance; mitigation options and time to implementation; and potential follow-up activities. This report provides a summary of the workshop including the key points, issues and questions raised by the participants, and it identifies possible topics for follow-up studies. No consensus views, conclusions, or recommendations are presented.

The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking. In 2003, the world consumed just under 80 million barrels per day (MM bpd) of oil. U.S. consumption was almost 20 MM bpd, two-thirds of which was in the transportation sector. The U.S. has a fleet of about 210 million automobiles and light trucks (vans, pick-ups, and SUVs). The average age of U.S. automobiles is nine years. Under normal conditions, replacement of only half the automobile fleet will require 10-15 years. The average age of light trucks is seven years. Under normal conditions, replacement of one-half of the stock of light trucks will require 9-14 years. While significant improvements in fuel efficiency are possible in automobiles and light trucks, any affordable approach to upgrading will be inherently time-consuming, requiring more than a decade to achieve significant overall fuel efficiency improvement. Besides further oil exploration, there are commercial options for increasing world oil supply and for the production of substitute liquid fuels: 1) Improved Oil Recovery (IOR) can marginally increase production from existing reservoirs; one of the largest of the IOR opportunities is Enhanced Oil Recovery (EOR), which can help moderate oil production declines from reservoirs that are past their peak production: 2) Heavy oil / oil sands represents a large resource of lower grade oils, now primarily produced in Canada and Venezuela; those resources are capable of significant production increases;. 3) Coal liquefaction is a well-established technique for producing clean substitute fuels from the world's abundant coal reserves; and finally, 4) Clean substitute fuels can be produced from remotely located natural gas, but exploitation must compete with the world's growing demand for liquefied natural gas. However, world-scale contributions from these options will require 10-20 years of accelerated effort. Dealing with world oil production peaking will be extremely complex, involve literally trillions of dollars and require many years of intense effort. To explore these complexities, three alternative mitigation scenarios were analyzed: Scenario I assumed that action is not initiated until peaking occurs. Scenario II assumed that action is initiated 10 years before peaking. Scenario III assumed action is initiated 20 years before peaking. For this analysis estimates of the possible contributions of each mitigation option were developed, based on an assumed crash program rate of implementation. Our approach was simplified in order to provide transparency and promote understanding. Our estimates are approximate, but the mitigation envelope that results is believed to be directionally indicative of the realities of such an enormous undertaking. The inescapable conclusion is that more than a decade will be required for the collective contributions to produce results that significantly impact world supply and demand for liquid fuels.

The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking. Dealing with world oil production peaking will be extremely complex, involve literally trillions of dollars and require many years of intense effort. To explore these complexities, three alternative mitigation scenarios are analysed: scenario I assumes that action is not initiated until peaking occurs; scenario II assumes that action is initiated 10 years before peaking; scenario III assumes action is initiated 20 years before peaking. For this analysis estimates of the possible contributions of each mitigation option were developed, based on an assumed crash program rate of implementation.

The U.S. economy depends heavily on oil, particularly in the transportation sector. World oil production has been running at near capacity to meet demand, pushing prices upward. Concerns about meeting increasing demand with finite resources have renewed interest in an old question: How long can the oil supply expand before reaching a maximum level of production -- a peak -- from which it can only decline? The author: (1) examined when oil production could peak; (2) assessed the potential for transportation technologies to mitigate the consequences of a peak in oil production; & (3) examined fed. agency efforts that could reduce uncertainty about the timing of a peak or mitigate the consequences. Includes recommendations. Charts & tables.

Today there are over a billion vehicles in the world, and within twenty years, the number will double, largely a consequence of China's and India's explosive growth. Given that greenhouse gases are already creating havoc with our climate and that violent conflict in unstable oil-rich nations is on the rise, will matters only get worse? Or are there hopeful signs that effective, realistic solutions can be found? Blending a concise history of cars and their impact on the world, leading transportation experts Daniel Sperling and Deborah Gordon explain how we arrived at this state, and what we can do about it. Sperling and Gordon assign blame squarely where it belongs-on the auto-industry, short-sighted government policies, and consumers. They explore such solutions as getting beyond the gas-guzzler monoculture, re-inventing cars, searching for low-carbon fuels, and more. Promising advances in both transportation technology and fuel efficiency together with shifts in traveler behavior, they suggest, offer us a way out of our predicament. The authors conclude that the two places that have the most troublesome emissions problems--California and China--are the most likely to become world leaders on these issues. Arnold Schwarzenegger's enlightened embrace of eco-friendly fuel policies, which he discusses in the foreword, and China's forthright recognition that it needs far-reaching environmental and energy policies, suggest that if they can tackle the issue effectively and honestly, then there really is reason for hope. Updated with a new afterword that sheds light on the profound changes in the global economy in the last year, Two Billion Cars makes the case for why and how we need to transform transportation now more than ever. "Authoritatively prescriptive." --Tom Vanderbilt, Wilson Quarterly "Provocative and pleasurable, far-seeing and refreshing, fact-based and yet a page-turner, global in scope but rooted in real places. The authors make a convincing case that smart consumers driving smart electric-drive cars can find the critical path to a safer planet." --Robert Socolow, Princeton University "In this insightful and persuasive book, Sperling and Gordon highlight one of the biggest environmental challenges of this century: two billion cars. They rightly contend that we cannot avert the worst of global warming without making our cars cleaner and petroleum-free. Luckily the authors also offer a roadmap for navigating this problem that is both visionary and achievable." --Frances Beinecke, President, Natural Resources Defense Council

In Restless Giant, acclaimed historical author James Patterson provides a crisp, concise assessment of the twenty-seven years between the resignation of Richard Nixon and the election of George W. Bush in a sweeping narrative that seamlessly weaves together social, cultural, political, economic, and international developments. We meet the era's many memorable figures and explore the "culture wars" between liberals and conservatives that appeared to split the country in two. Patterson describes how America began facing bewildering developments in places such as Panama, Somalia, Bosnia, and Iraq, and discovered that it was far from easy to direct the outcome of global events, and at times even harder for political parties to reach a consensus over what attempts should be made. At the same time, domestic issues such as the persistence of racial tensions, high divorce rates, alarm over crime, and urban decay led many in the media to portray the era as one of decline. Patterson offers a more positive perspective, arguing that, despite our often unmet expectations, we were in many ways better off than we thought. By 2000, most Americans lived more comfortably than they had in the 1970s, and though bigotry and discrimination were far from extinct, a powerful rights consciousness insured that these were less pervasive in American life than at any time in the past. With insightful analyses and engaging prose, Restless Giant captures this period of American history in a way that no other book has, illuminating the road that the United States traveled from the dismal days of the mid-1970s through the hotly contested election of 2000. The Oxford History of the United States The Oxford History of the United States is the most respected multi-volume history of our nation. The series includes three Pulitzer Prize winners, a New York Times bestseller, and winners of the Bancroft and Parkman Prizes. The Atlantic Monthly has praised it as "the most distinguished series in American historical scholarship," a series that "synthesizes a generation's worth of historical inquiry and knowledge into one literally state-of-the-art book." Conceived under the general editorship of C. Vann Woodward and Richard Hofstadter, and now under the editorship of David M. Kennedy, this renowned series blends social, political, economic, cultural, diplomatic, and military history into coherent and vividly written narrative.

We are living through a unique moment of transition, marked by a frenetic cycle of invention, construction, consumption and destruction. However, there is more to this transition than globalization, argue the authors of this unique and penetrating study. In their highly innovative approach, they set this transition against a broader evolutionary canvas, with the emphasis on the evolution of governance. The book's detailed analysis of five strategic sectors (economy, environment, health, information and security) points to an intricate and rapidly evolving interplay of geopolitical, cultural an.

In lively and engaging language, this book describes our dependence on freight transport and its vulnerability to diminishing supplies and high prices of oil. Ships, trucks, and trains are the backbone of civilization, hauling the goods that fulfill our every need and desire. Their powerful, highly-efficient diesel combustion engines are exquisitely fine-tuned to burn petroleum-based diesel fuel. These engines and the fuels that fire them have been among the most transformative yet disruptive technologies on the planet. Although this transportation revolution has allowed many of us to fill our homes with global goods even a past emperor would envy, our era of abundance, and the freight transport system in particular, is predicated on the affordability and high energy density of a single fuel, oil. This book explores alternatives to this finite resource including other liquid fuels, truck and locomotive batteries and utility-scale energy storage technology, and various forms of renewable electricity to support electrified transport. Transportation also must adapt to other challenges: Threats from climate change, financial busts, supply-chain failure, and transportation infrastructure decay. Robert Hirsch, who wrote the “Peaking of World Oil Production” report for the U.S. Department of Energy in 2005, said that planning for peak world production must start at least 10, if not 20 years ahead of time. What little planning exists focuses mainly on how to accommodate 30 percent more economic growth while averting climate change, ignoring the possibility that we are at, or near, the end of growth. Taken for granted, the modern transportation system will not endure forever. The time is now to take a realistic and critical look at the choices ahead, and how the future of transportation may unfold.