Genesis NRG, Inc., Peak Oil: A Challenge for Global Economies

FOR IMMEDIATE RELEASE
Pensacola, Florida, United States of America (Free-Press-Release.com) December 30, 2011 --

When oil production, including extraction and refining, reaches its high point, this is called peak oil. The term can apply to an oil field or global oil supplies. Oil production follows a bell curve, also known as the Hubbert Curve. When a source is first discovered, production increases sharply since the oil is easier to reach. This will eventually level off and the top of the curve represents when half of the oil in a region has been produced. From that point production will steadily decline.(1) Peak oil should not be confused with oil depletion. Peak oil simply means the point at which a source has reached maximum production, while depletion is when reserves and supply decrease.

The Hubbert Curve is named after M. King Hubbert, a U.S. geologist who predicted in the mid-1950s that U.S. oil production would peak in the 1960s. He was the first to assert, to the chagrin of his colleagues, that oil production would follow a curve. According to the model, any finite resource will eventually reach a point at which it is no longer economical to pursue it.(2)

Due to the importance of oil in modern industrial societies and financial systems, oil peak is a topic of serious discussion. Some experts theorize the U.S. oil peak led to the energy crises of the 1970s and set the country on a course to secure more foreign oil and increase the national debt.(3) As this continues on a global scale, the effects may be much worse. A 2005 report commissioned by the U.S. Department of Energy warned “liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social and political costs will be unprecedented.”(4) Some experts currently believe the oil peak for non-OPEC nations may have occurred this year, with 14 of the 16 biggest oil producers in the U.S. and United Kingdom seeing declines in production recently.(5) Today, the world consumes four times more oil than it discovers (6), and emerging economies like China and India will accelerate the decline. The approach of oil peak may also have contributed to the financial crises of 2008 by increasing commuting costs through higher fuel prices and leaving less money for families to pay mortgages. Peak oil could pose larger challenges in the future for economies based on perpetual growth.(7)


Sources:


1. http://peakoil.com/what-is-peak-oil/>
2. http://www.energybulletin.net/primer.php>
3. http://www.energybulletin.net/primer.php>
4. www.netl.doe.gov/publications/others/pdf/Oil_Peaking_NETL.pdf
5. http://www.forbes.com/sites/christopherhelman/2011/08/30/has-peak-oil-come-to-the-non-opec-world-maybe/
6. http://peakoil.com/what-is-peak-oil/
7. http://www.energybulletin.net/primer.php>

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