No peak oil and no energy transition in sight

The world is using more coal, oil and natural gas and will continue to do so.

The term “energy transition” was first used after the 1973 Arab Oil Embargo and was popularized by President Jimmy Carter in his November 8, 1977, “Address to the Nation on Energy,” Carter called on citizens to “look back in history to understand our energy problem.” President Carter said in his speech to the nation: “We simply use too much and waste too much energy.” The solution, he said, was for the U.S. to reduce its oil consumption and its excessive reliance on foreign oil because the U.S. was importing almost one-half of its oil. He offered three steps:

First, cut back on (energy) consumption.

Second, shift away from oil and gas to other sources of energy.

Third, encourage the production of energy in the United States.

Carter was echoing projections going back one hundred years that the U.S. and the rest of the world would soon run out of crude oil and natural gas. These projections were popularized by Shell Oil geologist and geophysicist M. King Hubert in 1956, who postulated that oil and gas reserves had been determined thousands of years ago in stratigraphic traps, so it was just a matter of time before those reserves were discovered, drilled and drained. He predicted that by the early 1970s, oil and gas production in the U.S. would peak and begin declining. Hence, Hubert’s theory was called “peak oil.” That is precisely what happened in 1971 when U.S. crude oil production peaked and started falling:

King also predicted that the global peak in oil production would occur in 2000. That appeared to happen, but King ignored a vital concept: technology. George Mitchell perfected hydraulic fracturing technology in the 1980s and 90s, and the “shale revolution” reversed the downward trend in natural gas and crude oil discoveries. U.S. oil and gas production changed directions in 2010. U.S. crude oil production recently surpassed 13 million barrels per day and shows no sign of abating.

A little-noted fact is that President Carter also said that the U.S. had to stop wasting the remaining oil and gas by burning more coal. Carter supported the Power Plant and Fuel Use Act of 1978, which required all electricity-generating plants to have the capability to burn coal instead of oil and natural gas. If you ever wondered why so many coal-fired generating plants were built in the late 1970s and 1980s, you can thank President Jimmy Carter.

A mere 45 years later, U.S. energy policy shifted from requiring more coal burning to effectively banning coal, crude oil, and natural gas except for natural gas peaking plants. The EPA’s proposed rules to decarbonize the U.S. economy align with the energy transition plans launched by the World Economic Forum and the International Energy Agency.

In their World Energy Outlook 2023, released on October 4, the IEA executive director, Fatih Birol, said that peak oil, coal, and natural gas is inevitable and will likely occur before 2030:

The transition to clean energy is happening worldwide and it's unstoppable. It's not a question of 'if, it's just a matter of 'how soon' – and the sooner the better for all of us.

The facts say otherwise. The indisputable facts are that crude oil, natural gas, and coal production and consumption are increasing rapidly and show no signs of abating.

U.S. natural gas production increased by 9% in 2022, and the EIA projects that it will reach a record high in 2023 and again in 2024:

U.S. crude oil production continues to increase according to the latest projections by EIA:

Adding insult to injury to M. King Hubert’s peak oil theory, EIA projects U.S. crude oil production broke through 13,000 barrels per day in August 2023 and is increasing at an increasing rate. Crude oil production from the Permian Basin is leading the way.

U.S. exports of LNG have continued to skyrocket and are expected to take off in 2024 as many new export terminals currently under construction will be completed:

Coal consumption worldwide continues to increase rapidly. More coal mines and power plants are opening in Asia.

My take: Fossil fuels, hydrocarbons, will not be eliminated or replaced in the foreseeable future because there are no viable substitutes. Modern life requires high-power-density fossil fuels.

In his book, “How the World Really Works, Vaclav Smil specified the four pillars of modern civilization: cement, steel, plastics, and ammonia. All four require fossil fuels. Smil notes that all four are the necessities of modern civilization, but ammonia deserves the most important in keeping the world’s population alive:

In 2020, nearly 4 billion people would not have been alive without synthetic ammonia (derived from natural gas), it would be impossible to feed at least 40 percent and up to 50 percent of today’s nearly 8 billion people (page 79).

Wind, solar, and batteries cannot be used to produce ammonia.

Fossil fuels are the basis of modern life, and no government policies, domestic or foreign, can change that. Production and consumption of hydrocarbons have not peaked and will not peak in the foreseeable future because there are no substitutes. While technologies such as CCUS, carbon capture, use, and sequestration offer the potential for decarbonization, the goal of eliminating fossil fuels in less than many generations is impossible.

Continuing to pursue the elimination of fossil fuels will devastate economies and negatively impact human flourishing. The fragility of U.S. power grids is just the beginning of bad outcomes if pursuing this impossible goal continues.

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