Peak oil always was a silly thing to panic over and now we've the UK's very own High Priest of the Church of Gaia telling us so. George Monbiot used his column this week to point out that we're not running out of oil and the wells are not going to run dry anytime soon. Supply is increasing rather nicely.
As he says:
The constraints on oil supply over the past 10 years appear to have had more to do with money than geology. The low prices before 2003 had discouraged investors from developing difficult fields. The high prices of the past few years have changed that.
Any economist could have told him that. Resource constraints are always an economic problem: solved by the price mechanism.
It was never true that we would run out of oil – it just gets more expensive. At a higher price, people use less and go and hunt for more. Both have happened: the amount of oil (or energy of any kind) used to produce one dollar of GDP has been falling for decades now. Techniques to extract more have been developed as those prices rise. And I'm afraid that people don't seem to understand the implications of those new techniques.
Take the Macondo field drilled by BP. Yes, a disaster in the Gulf: but also the deepest well ever drilled. Having developed the technology to drill so deeply we have not only discovered one new oil field – we've also discovered a whole new Earth that we can explore for oil. That part of the entire globe that between 4,000 and 5,000 feet below the surface.
Inventing fracking does not mean just extracting gas from Pennsylvania or oil from the Bakken. It means prospecting the whole planet again for such deposits. New technologies mean we have invented whole new planets to explore for resources.
This does not apply only to peak oil or peak gas. There are those out there who worry about peak copper, peak indium and even peak tellurium (an odd one when we use 125 tonnes a year and there's 120 million tonnes in the crust). None of these are geological problems, they are all plain and simple economic ones.
This is not to say that the world is free from problems. As Monbiot points out, if you care to worry about such things, having so much more oil might boil us all. But we already know the solution to that, a simple carbon tax. For we are not running out of the things that are subject to the price system. We are finding problems with things like the atmosphere, clean water, fisheries, which are not subject to it. The answer is therefore to introduce the price system to those natural resources so that we don't run out of them.