Projections for “peak oil” have failed since the last century

At the same time that the news is flooded with announcements of major investments in renewable sources, global oil consumption is at its highest level in history. The most recent data from the International Energy Agency (IEA), from July, points to the mark of 103 million barrels per day. Not surprisingly, there is a lot of uncertainty in projections about oil demand in the coming years.

But it is worth highlighting that some of the biggest mistakes in this sector were related to projections for the so-called “peak oil”, a moment in which global production would reach its highest level and then decline. The supposed achievement of this milestone has been successively postponed.

To take a not too distant example, in 2004 – just under 20 years ago – the Association for the Study of Peak Oil and Gas (Aspo) estimated that this peak would be reached in 2005, with 64 million barrels per day. According to the organization’s calculations, in 2020 global production would have already fallen to 43 million barrels per day, with the depletion of reserves.

Adopting a less restrictive methodology and considering a greater proportion of recoverable oil in reserves, the North American government’s Energy Information Administration (EIA) was more accurate in its projection made in 2003: its main scenarios were the peak of the oil to 2030 or beyond.

In its calculations, Aspo adopted the methodology of North American geologist Marion King Hubbert, who worked at Shell. In the mid-1950s, he became famous for stating that the peak of oil production in the United States would be reached between the end of the 1960s and the beginning of the 1970s. At first, he was right – and he was right for a long time.

In 1970, the USA reached the historic mark of 10 million barrels per day, which then declined until it reached 5 million barrels in 2008. However, Hubbert did not count on the shale oil revolution, which generated a new boom in the last decade and a half.

Last July, the US produced 12.991 million barrels of oil per day, according to the EIA – just 9,000 barrels less than the record of 13 million reached in November 2019, before the pandemic.