The theory that the world is near or passed peak oil reserves is fraudulent, says energy analyst, and former MIT Professor, Michael Lynch in an Op-Ed for the New York Times.
Lynch drops a bomb on the peak-oil theorists saying, “a careful examination of the facts shows that most arguments about peak oil are based on anecdotal information, vague references and ignorance of how the oil industry goes about finding fields and extracting petroleum.”
He takes down what he calls the “three major claims” of the peak-oil crowd:
1. The world is only discovering one barrel of oil for every three or four produced. Says Lynch, this is “a statement that reflects ignorance of industry terminology.” When new oil fields are found, an estimate is given. Often times that estimate proves too small when new pockets of oil are found in a field. Taking those into account, older fields are keeping pace with production. He also adds that arguments that we’ve pulled all the easy oil are silly because technology is always advancing.
2. Political instability puts us at risk of losing our oil. When oil prices spiked in the 70’s from the Arab oil embargo, pundits said this was just the start of higher energy prices. We all saw what happened. Today, it’s the Iraq invasion, the Venezuelan and Nigerian disruptions. This will lead to investment in other parts of the globe.
3. There’s only 2 trillion barrels of recoverable oil out there. Geologists say there is 10 trillion barrels out there. A decade ago only 10% was recoverable, but technological improvement has improved that to 35%, and it’s only going to get better. And that doesn’t include tar sands projects.
As a matter of fact, Lynch says “oil remains abundant” and expects the price to fall to its historic level of $30 as new oil field discoveries in Latin America and in the waters of East and West Africa come on line.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.