Current mood:	pessimistic
Current music:	Sheryl Crow - My Favorite Mistake
Entry tags:	economics

Peak oil?
Last night I attended a public lecture at Stanford about the end of oil. After a brief introduction to the conditions under which fossil fuels are formed, a pair of speakers took turns presenting opposing viewpoints. I took notes on my Crackberry. Here they are:

Doomsayer (Amos Nur):
Income vs oil use: all countries seem to use more oil as their standard of living improves.
Additional reserves only delay peak not tail of usage curve.
US oil use outstrips domestic consumption.
We will need other fuel sources.
After the mid-east, Canada and Venezuela have the most oil.
Oil wars are just skirmishes between oil producers and consumers.
China once thought it would be a net oil producer!

Capitalist (Steven Gorelick):
Malthus was wrong about food shortages.
Bell curve doesn't apply to chronological use.
Hubbert's curves were wrong.
We have been discovering new reserves faster than we can use them.
Sometimes domestic production drops when it is cheaper to import.
We have no idea how much oil we will be able to find in the future.
Price increases and new tech drive supply increases.
But increased supply drives prices down.
We also find alternatives that decrease usage.
We can increase GDP without a corresponding increase in oil use by being more efficient.
The world has been getting more GDP per oil barrel with time.
We are finding more oil and extraction is getting cheaper.
Under 5% of US energy needs are met by the Persian gulf!
World oil use per capita has been steady for 20 years.

We still need to worry about the pollution generated by burning fossil fuels though.