Doomsayers Say Another Energy Crisis Looms Large

Article excerpt

SAN FRANCISCO -- Oil, the black gold of the world economy, is almost insanely cheap. Yet it won't be for long, according to a small but growing band of doomsayers.

Based on a debated theory, they fear world oil demand will begin to exceed supply as early as about 2010. That might revive sights not seen since the oil crises of the 1970s: long lines at gas stations and Saudi Arabian princes buying American skyscrapers.

"Anybody who wants to drive their motor home up to Alaska better do it now while the supply of oil is cheap," said veteran oil geologist L.F. "Buzz" Ivanhoe. "It's not a joke. I hope I'm wrong as hell, but I fear that I'm not."

Such claims have sparked a debate among oil geologists, economists, engineers and industry officials, most of whom insist there is plenty of oil left for many decades to come.

Nowadays, the world is awash in cheap oil. Prices are so low that they are hastening the collapse of the economy of Russia, a major oil exporter.

Ron Swenson, a mechanical engineer who is president of EcoSystems Inc. in Santa Cruz, Calif., uses the World Wide Web to warn about "the coming global oil crisis."

While the American Petroleum Institute insists that the world's known oil reserves increase every year, Swenson dismisses such talk as "a play on words."

"Between 1973 and today, we have consumed a quarter of the world's entire endowment of oil from the beginning of history until the end," said Swenson. "If we've consumed a quarter of our oil in that time, we don't have more oil, we have less."

Such fears of a post-millennium oil crunch are "primarily bunk," said economist Mike Lynch of the Massachusetts Institute of Technology. Lynch, an expert on oil-supply trends, laughingly recalls past flubbed forecasts of an oil apocalypse. One of the leading present doomsayers is Colin Campbell of Petroconsultants in Geneva who, Lynch said, "predicted in a 1989 article ... that world (oil) production had peaked ... and that the price would go to $40 to $50 (a barrel) in the early 1990s.

"And now," Lynch said, "it's about $12 to $13."

The fate of oil supplies is starting to attract attention in the scientific community. "The Next Oil Crisis Looms Large -- and Perhaps Close," is the headline on a four-page story in the Aug. 21 issue of Science.

Pessimists like Ivanhoe "gained a powerful ally this spring when the Paris-based International Energy Agency of the Organization for Economic Cooperation and Development reported for the first time that the peak of world oil production is in sight," said author Richard Kerr. …