Added this point to my “Why now?” page.
6. Why doesn’t the USGS see this?
Given these statements, why are the USGS so sure the world has a lot of oil? The USGS advise the United States DOE’s Energy Information Agency, which in turn advises the US Government on energy matters. It’s like one big daisy chain that, when the crisis hits, will let everyone in charge to pass the buck and say, “But I thought they knew”. I can’t be bothered to look up the historical circumstances that allowed the coalface of oil investigation to become so separated from those in charge, but it does seem to add to the “plausible deniability” that perpetuates business as usual… even in the face of $130 dollar a barrel oil!
Guy Caruso trusts the USGS methodology. What is that methodology? Basically the USGS developed a method of “guessing” how much oil was in the world which seemed to work pretty well up until global discovery peaked in the 1960’s. They wanted a method of “counting” the oil they had not found yet… and before American oil discovery peaked, they seemed to be finding oil faster than they were burning it! (It must have been a heady time for oil hunters, making big “kills” all the time like that!)
So what they came up with was the probability method. We have P5, P50 and P95. The P stands for “Probability”. So P5 stands for only a probability of 5% or a 1 in 20 chance of that oil being in the ground, P50 is a 1 in 2 certainty, and P95 is 95% certain that the oil is in the ground.
It worked well in the expansionary age of discovery and production, but has not really been accurate for about 40 years since global discovery peaked in the 1960’s. Yet they stubbornly hang onto this methodology because it gives more comforting results.
Now with a growing number of geologists and troubling reports coming out, I would have though all energy agencies would have been broadcasting and counting ONLY the stuff we KNEW was there with near certainty… the Probability 95% or P95 oil.
That’s not what they do! In a world with ever more nations peaking and going into permanent decline, the USGS keeps assuming that the discovery trends of the first half of the oil age will continue (ignoring the discovery trends of the last 40 years!)
OK, hold onto your hats. In layman’s “peak oil for dummies” terms, this is what the USGS does. They still take the P5 odds and mix them with the P95 and then hey presto! That’s how much oil is in the world.
In other words, let’s imagine some USGS dude in a particularly optimistic frame of mind — maybe he’s just met a nice girl — suggests a 5% chance that there’s 4 trillion barrels of recoverable cheap oil in the world, and a more hard nosed USGS guy says no, there’s only 2 trillion barrels of oil in the world, and then rather than trusting the hard nosed rational guy with numbers that are conservative and fairly certain, they mix the optimists guess in and come up with 3 trillion barrels…. and leave it kind of open ended, just in case there’s more anyway!
In a world with the leaks coming out of OPEC that I’ve mentioned above, do you think that’s a good way to advise government on oil security? Let an agency 2 or 3 degrees of separation away from those actually making energy policy decisions then play with numbers like that in some think tank?
W. Zittel, J. Schindler, L-B-Systemtechn wrote: The Countdown for the Peak of Oil Production has Begun. This report documents the problems I’ve highlighted above. It is well worth the read as it details the fallacies behind the leading energy advisors to the world. Do not miss it! Even if you are a newcomer, read it, then read it again to get your head around the ridiculous and easily verifiable “methods of madness” in the leading energy agencies.
Eclipse Now 