As oil is a finite non-renewable resource on a human timescale, it is globally accepted that oil extraction will reach a maximum – often called a production peak or peak oil – and will then follow a long decline likely dotted by short-term recoveries, during which the society will progressively consume less oil and adapt to this new situation. Finally, oil extraction will stop or reach a marginal rate, which will make oil a curiosity rather than the mass product that we enjoy today (about 4 liters per day for a European). Due to the structural and fundamental roles that oil has in the society since the beginning of the XXth century, it should be a priority to anticipate the turning point in the historical trend – for more than 150 years, we have enjoyed growing extraction volumes and peak oil is the beginning of declining extraction volumes.
The decline originates from constraints that increasingly weight on the extraction rate over time . These constraints result from interactions between physical factors that are characteristic of the resource, technical factors, economical factors, political factors, and others. The relative importance of these “below ground” and “above ground” factors fuels harsh debates because they vary from resource to resource, and because each analyst tends to overweight in his analysis the role of the factors he knows best (geology, economy, geopolitics,…). In addition to these constraints, there is now the climate constraint. Some say that this political constraint will dominate all the other constraints, and will drive a decline in oil extraction through demand reduction.
There is evidence, however, that the other constraints are now already sufficient to curb world conventional oil extraction, which represents three quarters of all liquid fuels, and force us to extract more difficult and costly oils, such as shale oil. Remember. The peaking of conventional oil took the world by surprise, prices skyrocketed, worries about the state of the economies were high. It was in 2000-2008. But after the crisis, thanks to high oil prices, an accomodative US monetary policy and the american pioneering spirit, US shale oil arrived, flooded the market, and the oil price eventually collapsed. But all this is temporary. Shale oil offered us a respite of about ten years, and we forgot the lessons given by the peaking of conventional oil.….
Evolution of the conventional oil production and of the oil price. Observation (in black) and forecasts made by the IEA at different years (in colors).