By Antonio Turiel: The Sunset of Oil (2018 Edition)

Oil Realistic Net Energy

Antonio Turiel reads between the lines of the latest official IEA data to provide his annual forecast on oil availability.

He predicts that in 2040 we will have less than half the oil we enjoy today.

I consider this a best case scenario because when economic contraction overwhelms our ability to mask reality with debt, many other actors will conspire to disrupt the complex technology network we depend on.

Like hungry people rioting in the streets, trucks with empty diesel tanks, no letters of credit for trade, and war.

P.S. Economists are idiots.


For readers who have just arrived at this blog , that graph will probably be quite impressive. Basically, it is telling us that the net energy that we can most realistically expect to receive from oil will fall from 69 Mboe / d in 2015 to 33.3 Mboe / d in 2040, that is, a fall of more than 50 % in a period of 25 years. It is certainly an ominous prospect, but it is similar to what we have obtained in other years and in fact this year’s is slightly better (0.9 Mb / d more in 2040) than last year.


With each passing year, the IEA is forced to make a new return on its forecasts regarding the production of liquid hydrocarbons. This year for the first time it has shown two graphs that anticipate a very unpleasant scenario in terms of oil production, something that seems to be already beginning to notice with the possible arrival of the peak of diesel production. As the years go by and the production data are known, it shows that the trends that we anticipated a few years ago are beginning to consolidate. More importantly, something that radically changes the situation has not just appeared, but rather the opposite: investment in exploration and development of new deposits falls worldwide except in the US, to the extent that currently North America , which produces less than 20% of all the world’s oil, it invests more than 50% in exploration and development.


And in the USA, the myth of fracking as a great revolution is increasingly exposed: the Financial Times questions the quality of the hydrocarbon extracted by fracking (it can not be used to produce diesel because it would be very expensive, among other things ); and a few days ago Art Berman showed that, contrary to the myth of ever decreasing exploitation costs, it turns out that in the last year and a half they have experienced an appreciable increase.


The classical economists, who only look at the price of oil, consider that there is nothing to worry about because right now the price is low. They have not understood the price volatility , they do not understand the effects of the energy spiral . The analysis of the production data, on the contrary, shows us a very complex situation ahead, forecast that as the years pass it seems to be confirmed.

6 thoughts on “By Antonio Turiel: The Sunset of Oil (2018 Edition)”

  1. Tim Watkins on creeping normality (aka old age)…

    “Take a look around you at your family, friends and neighbours. Understand that 6 out of every 7 of them are only alive because of oil. Take away the oil and there is no industrial agriculture; no extractive industries, no industry, no transport, and ironically no solar panels or wind turbines. Now understand that if we do not cease using oil (and coal and gas) more or less immediately, 6 out of every 7 of them are going to die anyway because of the polluting fallout – including climate change – from all of those industrial processes that keep them alive. But that isn’t going to happen today. Nor – unless you know what to look for – will you notice much change from day to day, week to week or even year to year (although those old enough to remember will be aware that 2018 is very different to the years before 2008; and that even those years were very different to the swinging 1960s).”

    “Back in the 1970s, we could have acted to avoid a collapse. We didn’t because the future looked to be a long way away. Today the best we can do is to mitigate some of the worst of what is about to befall us. But even now the future seems less urgent that the present. There will, however, be a series of emergencies in the 2020s as the developed countries, and especially those in Europe, experience shortages of critical resources – including fossil fuels – that people did not realise our lives depended upon. When that happens it will be impossible to maintain international trading arrangements, leading to a collapse of economies and political revolts on a scale and ferocity that will make Brexit, Donald Trump and the yellow vests look positively benign. Meanwhile, trends that are already unfolding around us (such as increasing child mortality, homelessness, food shortages, falling life expectancy, and the emergence of deadly strains of formerly treatable illnesses) will worsen; resurrecting living conditions of a kind last seen at the dawn of the industrial age.”

    “The only question left to be answered is whether we will come together or fall apart in the face of collapse. And all I have to say on that matter is: hope for the best but prepare for the worst.”


  2. HI Rob It was hard to access the data from the IEA website to understand where Antonio Turiel got his reserves figures and predictions. I found Mohr et Al study attached below to be pretty thorough and it indicates by 2040 even under low estimate that we should be treading at similar reserves of oil and gas especially through through and until 2050 before starting to see a steep decline.


  3. Here is a nice peak oil summary and status report from Geoffrey Chia.

    “The unconventional oil industry can never be and will never be self propagating, it requires cheaper oil input from high EROEI sources to produce this low EROEI expensive oil. Ignorant pundits claim that if only the price of oil rises again to, say, 100 dollars per barrel instead of, say, a current price of 51 dollars per barrel (WTI price as of 16 December), then UC oils would become economically viable and would start to make a profit. Hence investors must simply bide their time. The lie to this claim is exemplified by the fact that shale oil has NEVER made any net profit, even when oil price was over $100 per barrel. The money earned from UC oil has ALWAYS been less than the investment inputs required. Those ignorant pundits ignored the fact that as the overall market price of oil rises, the input costs to produce that UC oil will correspondingly also rise, making the final cost of the UC oil always higher than the overall extant market price. Always.”


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