Physicist Warns Global Oil Production Peak Could Bring Economic Disaster

By McCall, William | THE JOURNAL RECORD, August 13, 2001 | Go to article overview
Save to active project

Physicist Warns Global Oil Production Peak Could Bring Economic Disaster


McCall, William, THE JOURNAL RECORD


PASADENA, Calif. (AP) -- It's not the energy crisis that worries Caltech physicist David Goodstein. It's the economic crisis he fears it could cause.

Goodstein recently looked at a famous 1950s analysis that correctly predicted U.S. oil production would peak about 1970. Expanding the scope, he estimated world production could hit a peak in 2007 -- decades ahead of previous predictions.

The United States could draw on the rest of the world's supply to meet its demand when the domestic supply declined in 1970. But when the world supply peaks, oil will become scarce because "nature is not making any more oil," Goodstein says.

If government and industry leaders don't push hard and fast to develop alternative energy sources and the infrastructure to support them, Goodstein says the world could be pushed over an economic cliff created by skyrocketing oil prices.

While some experts say Goodstein's scenario is a possibility, others say he should stick to physics. They point out that estimates of the world's oil reserves have been increasing over the years, and contend that alternative fuel sources will be developed before there is a serious oil shortage.

"This is a classic example of why physicists shouldn't do economics, just like economists shouldn't do physics," said Stanford economist Frank Wolak, who has tracked the energy industry for years.

The oil and auto industries have moved into alternative fuel research but actual conversion is slow because the price of oil is relatively cheap, even at today's prices, Wolak says, so there is little incentive to switch.

Wolak and Goodstein note that a liter of bottled water -- about a quart -- is more expensive than a liter of gasoline in California.

But unlike Goodstein, Wolak sees a smooth transition to alternative energy because he says the free market has always created investment incentives for new technology. He also points out that higher prices have the effect of increasing exploration and development of new oil recovery techniques that were too costly at lower prices.

Besides, Wolak says, supply and demand always find a balance.

"We'll never run out of oil," Wolak says, "because as it becomes more and more scarce, the price will move to allocate it to those who need it most."

Michelle Foss, director of the University of Houston Energy Institute, says oil consumption has typically slowed dramatically when prices reach about $30 to $35 a barrel.

"If it gets above that, people use a lot less of it," Foss said.

Dan Butler of the U.S. Department of Energy says government studies show the earliest global production peak arriving some time in the 2030s, despite an estimated average consumption of up to 120 million barrels a day.

"Estimates of worldwide resources are dramatically increasing," said Butler, an analyst for the DOE's Energy Information Administration, an independent agency that forecasts oil supplies.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Physicist Warns Global Oil Production Peak Could Bring Economic Disaster
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?