Hirsch Report

[KJ]

Wayback Machine

• World oil peaking is going to happen, and will likely be abrupt.
  • World production of conventional oil will reach a maximum and decline thereafter.
  • Some forecasters project peaking within a decade; others contend it will occur later.
  • Peaking will happen, but the timing is uncertain.
• Oil peaking will adversely affect global economies, particularly the U.S.
  • Over the past century, the U.S. economy has been shaped by the availability of low-cost oil.
  • The economic loss to the United States could be measured on a trillion-dollar scale.
  • Aggressive fuel efficiency and substitute fuel production could provide substantial mitigation.
• Oil peaking presents a unique challenge.
  • Without massive mitigation, the problem will be pervasive and long-term.
  • Previous energy transitions (wood to coal and coal to oil) were gradual and evolutionary.
  • Oil peaking will be abrupt and revolutionary.
• The problem is liquid fuels for transportation.
  • The lifetimes of transportation equipment are measured in decades.
  • Rapid changeover in transportation equipment is inherently impossible.
  • Motor vehicles, aircraft, trains, and ships have no ready alternative to liquid fuels.
• Mitigation efforts will require substantial time.
  • Waiting until production peaks would leave the world with a liquid fuel deficit for 20 years.
  • Initiating a crash program 10 years before peaking leaves a liquid fuels shortfall of a decade.
  • Initiating a crash program 20 years before peaking could avoid a world liquid fuels shortfall.
• Both supply and demand will require attention.
  • Sustained high oil prices will cause forced demand reduction (recession and unemployment).
  • Production of large amounts of substitute liquid fuels can and must be provided.
  • The production of substitute liquid fuels is technically and economically feasible.
• It is a matter of risk management.
  • The peaking of world oil production is a classic risk management problem.
  • Mitigation efforts earlier than required may be premature, if peaking is long delayed.
  • On the other hand, if peaking is soon, failure to initiate mitigation could be extremely damaging.
• Government intervention will be required.
  
  • The economic and social implications of oil peaking would otherwise be chaotic.
  • Expediency may require major changes to existing administrative and regulatory procedures.
• Economic upheaval is not inevitable.
  • Without mitigation, the peaking of world oil production will cause major economic upheaval.
  • Given enough lead-time, the problems are soluble with existing technologies.
  • New technologies will help, but on a longer time scale.
• More information is needed.
  • Effective action to combat peaking requires better understanding of the issues.
  • Risks and possible benefits of possible mitigation actions need to be examined.