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ECON 101: Peak Oil Theory: Oil, Smoke and Mirrors (2006-Video 49:42)



May 17, 2008 – Comments (9) | RELATED TICKERS: OIH , KBR , HAL

Peak Oil Theory is a major investment theme in todays market. It is something you should understand and have an educated opinion on. Peak oil theory, if it is true, will likely have a very large impact on the way we live and consume in the future. The video below is a good review of the peak oil theory.

FYI - from wikipedia Peak oil:

Peak oil is the point in time when the maximum rate of global petroleum production is reached, after which the rate of production enters its terminal decline. If global consumption is not mitigated before the peak, an energy crisis may develop because the availability of conventional oil will drop and prices will rise, perhaps dramatically. M. King Hubbert first used the theory in 1956 to accurately predict that United States oil production would peak between 1965 and 1970. His model, now called Hubbert peak theory, has since been used to predict the peak petroleum production of many other countries, and has also proved useful in other limited-resource production-domains. According to the Hubbert model, the production rate of a limited resource will follow a roughly symmetrical bell-shaped curve based on the limits of exploitability and market pressures.

Some observers, such as petroleum industry experts Kenneth S. Deffeyes and Matthew Simmons, believe the high dependence of most modern industrial transport, agricultural and industrial systems on the relative low cost and high availability of oil will cause the post-peak production decline and possible severe increases in the price of oil to have negative implications for the global economy. Although predictions as to what exactly these negative effects will be vary greatly, "a growing number of oil-industry chieftains are endorsing an idea long deemed fringe: The world is approaching a practical limit to the number of barrels of crude oil that can be pumped every day."[1]

If political and economic change only occur in reaction to high prices and shortages rather than in reaction to the threat of a peak, then the degree of economic damage to importing countries will largely depend on how rapidly oil imports decline post-peak. The Export Land Model shows that the amount of oil available internationally drops much more quickly than production in exporting countries because the exporting countries maintain an internal growth in demand. Shortfalls in production (and therefore supply) would cause extreme price inflation, unless demand is mitigated with planned conservation measures and use of alternatives, which would need to be implemented 20 years before the peak.[2]

Optimistic estimations of peak production forecast a peak will happen in the 2020s or 2030s and assume major investments in alternatives will occur before a crisis. These models show the price of oil at first escalating and then retreating as other types of fuel and energy sources are used.[3]

Pessimistic predictions of future oil production operate on the thesis that the peak has already occurred[4][5][6][7] or will occur shortly[8] and, as proactive mitigation may no longer be an option, predict a global depression, perhaps even initiating a chain reaction of the various feedback mechanisms in the global market which might stimulate a collapse of global industrial civilization. In early 2008 there are signs that a possible recession will be made worse by rising oil prices.[9]

Oil, Smoke and Mirrors Ronan Doyle -


9 Comments – Post Your Own

#1) On May 17, 2008 at 11:23 AM, AnomaLee (28.90) wrote:

This is the internet.... I've watched most of this through already, but 50 minutes is not instant gratification!

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#2) On May 17, 2008 at 12:28 PM, StatsGeek (28.54) wrote:

Clive Maund has similar thinking:

If the allegations about 9/11 are true, then Bush is much more brilliant, Machiavellian and evil than I have given him credit for.  It is interesting that Bush chose an oil veteran as his Veep.  Also, it will be mission critical now for Bush to prevent a democratic administration for the next 4+ years, so they will have to fabricate a political bomb to drop on Obama before the election, or maybe another war, in order to make sure McCain takes office and we keep our military in the Middle East.

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#3) On May 17, 2008 at 1:18 PM, AnomaLee (28.90) wrote:

No one wants to believe we are peaking in oil output. People also seem to have dismissed the fact entirely that we entered the Gulf War to protect our oil interests with Saudi Arabia and Kuwait. Therefore, we've already waged one war over oil fields. Ironically, we eliminated that threat completely 11 years laters...

StatsGeek, George Bush Sr. is a remarkably accomplished and intelligent individual. I doubt there is little his legacy could accomplish. Also, Dick Cheney was originally appointed to find a Vice President. Ironically, he appointed himself several weeks later...

I've seen plenty of conspiracy videos that seem to reach very far, but I still find the near-perfect demolition of Building 7 to be most disturbing. Ironically, all the evidence was removed.

"A person is smart. People are dumb... panicky, dangerous animals, and you know it." - Agent K in the film Men in Black

I've always remembered that line, and find it to be so true. I'm sure if there were memory erasers our memories would disappear quicker than the American flag from the front lawn after 9/11.

George H.W. Bush - Wikipedia

Have you ever seen these? You could be more informed by watching this and the Daily Show compared to watching 90 hours of Reverand Jeremiah Wright being broadcasted per week.

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#4) On May 17, 2008 at 1:26 PM, AnomaLee (28.90) wrote:

I never post anything like you but since you get away with **** IT!

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#5) On May 17, 2008 at 4:57 PM, abitare (29.59) wrote:

This post is not about the 9-11 inside job story. Almost all wars are started on a lie or hubris. Gott Mit Uns (God with us) was worn by German soldiers, who were marching under Nazi orders. (I will write about this later)

The post is about the theme of Peak Oil, the war and trust. Trust is an estential part of a nation, its' currency and it's stock market. The trust in America been eroded due to the war and the mishandling of the occupation of Iraq. The dollar has fallen 50% and the US stock market has underperformed much of the world market. Gold, oil and silver has gone up significantly, it has a lot to do with trust, peak oil and the war.  

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#6) On May 17, 2008 at 7:37 PM, Tastylunch (28.55) wrote:

that's a one heck of a lot of wikipedia links. How long did it take you to do this?

good post for those unfamiliar with the concept ( not me ). Too bad CAPS doesn't have a way to have an archive of posts like this for newbs...  

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#7) On May 18, 2008 at 3:06 PM, abitare (29.59) wrote:


Thank you for the replies.


I like that guy. Great link.


Fool has CANX my posts and pitches before. I keep on trying.

For the record,

I believe that 9-11 was an OUTSIDE JOB, meaning, the planning and the people, who commited the attack are from outside of the US. I do NOT believe any government agency had any convincing or real evidence of the attack.

Most people, who work in public service are extremely patriotic. If someone approached them with the 9-11 planning most government employees would immediately turn them over to the authorities. Most Americans love their country to much to plan or to allow such an attack. Especially, people who are in public service.  To pass a government polygraph, is very, very difficult. You have to have a clean background and LOVE your country. Or you will very likely fail....

So my educated guess is: 

9-11 was an OUTSIDE JOB. Planned outside the US, by non-US agencies (al Qida) and excuted by foreigners.

9-11 gave the Neocons an excuse to invade Iraq and occupy Iraq.  

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#8) On May 19, 2008 at 12:34 PM, zygnoda (< 20) wrote:

That video was disappointing.  I thought it was going to be an interesting video about peak oil.  It turned into a 9-11 truth video..

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#9) On May 19, 2008 at 4:03 PM, abitare (29.59) wrote:


Take a look at my post on May 04, 2008:

Econ101: Peak Oil Theory; Matt Simmons (Bloomberg): Peak Oil Now, Oil Perhaps to $300

I think it is still important to know that many, many people think Peak Oil and 9-11 are apart of the same story. Millions around the world did see Micheal Moores Fahrenheit 9/11.

I recommend the movie Crude Awakening. For Peak oil with out 9-11. 

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