The end of the era of cheap oil A decisive factor in Climate Change

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The end of the era of cheap oil A decisive
factor in Climate Change
Miltos Tsoskounoglou Environmental
Affairs Health and Safety Manager
Toyota Hellas
October 2008
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• According to current trends, within the next
  generation.

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World population will increase by 30
30
8300
6400
2030
2005
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World GDP will double
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World car parc will double
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World oil demand is expected to rise by 50
50
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CO2 in the atmosphere will have risen
considerably, making Global Warming worse
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• What is missing from the picture is that by then
  Oil production will have gone past its Peak

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Technology has advanced in great strides.
However.
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Discoveries of new oil reserves have fallen
steadily since the peak in 1965 we are
currently consuming 3 barrels for every new one
discovered
Past Discoveries
Production
Expected discoveries
Source ExxonMobil
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Existing production declines worldwide by 4
p.a. New supply equal to that of Saudi Arabia
is needed every 3 years just to cover for
depletion
IEA Medium-Term Oil Market Report 2007
Industry needs to generate 3.0mb/d of new
supply each year just to offset decline.
Source ExxonMobil
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In the USA, no new technology, no increase in
prices, no discovery of major new fields was able
to reverse the fall in oil production after the
Peak was reached in 1971
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We will not run out of oil but, like the USA,
world production will reach a Peak, after which
point it will irreversibly start to decline
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The Peak will be reached in the next few years
some claim we have already reached a plateau
Source Bauquis P.R., 2006
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Production data shows that over the last 3 years
world conventional crude oil production has
hardly increased
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Non-Opec crude oil production seems to have
already reached a plateau
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World unconventional liquid fuels production is
rising slowly accounts for 14 of world liquid
fuels supply
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World liquid fuels production has increased
hardly at all according to EIA , or slightly
according to IEA
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Price fluctuations can be explained by basic
economics by the inability of supply to meet
increasing demand and by the oncoming world
recession which is lowering demand for oil
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• Emissions of CO2 and Climate Change will be
  influenced by Peak Oil

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Peak Oil is sending strong market
signalsinfluencing not only the cost of oil but
the cost of energy which leads to actions
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• ? If greater energy efficiency
• ? If more biofuels and renewables
• ? If substitution by other liquid fuels
  (unconventional oil, synthetic liquid fuels)

?
X
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And to make things even more difficult, there are
signs that Peak Natural Gas might also not be far
off
Source ASPO, C. Campbell
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Thank you!