The Gray Lady discovers peak oil
The peak-oil phenomenon made a mainstream-media splash this weekend in an extensive New York Times Magazine cover story. Devotees of this once-obscure issue won’t find much that’s new, but the article effectively summarizes the grim state of affairs. Output at many of the world’s biggest oil fields has been declining steadily, and all eyes are now turned to Saudi Arabia, by far the world’s largest oil producer, which refuses to allow independent audits of its reserves. The country’s regime says it can still boost supply considerably, but many oil analysts have come to doubt those claims. Global oil supply and demand have been converging for years and are now tightly matched, which means any disruption in supply — a natural disaster, terrorist attack, or unexpected decline in production at one of the big oil fields — could mean sudden price spikes and catastrophic oil shocks throughout the world. If, as many expect, total supply begins an inexorable decline, the developed world’s entire way of life could be jeopardized. Whee!
