State of Denial
By Dr Mamdouh G. Salameh in Energy Politics Archives Spring 2008
Writing in 2008, Mamdouh Salameh foreshadows the potential consequences of peak oil and/or tightening oil markets—arising from a lack of investment in crude oil production, and burgeoning demand Remarkably, while the peak oil theory has yet to come to fruition, the market continues to be driven by periodic cobweb style cyclical fluctuations in supply and demand in a market where the amount produced must be chosen before prices are observed. Given these market characteristics there is no guarantee that crude oil producers will be able to quickly ramp up supply on demand….
State of Denial
There is no risk that we are running out of oil but chances of being able to match the projected growth in demand over the medium term with a rise in production is being seriously questioned.
With the peaking of global conventional oil production, geopolitics and market economics will result in even more significant price increases and security risks. Oil wars are certainly not out of the question (the war on Iraq was a foretaste of what’s to come). The governments of the major oil-consuming countries as well as the multi-national oil companies and some international organizations are in a state of denial about the implications of peak oil. Moreover, the days of inexpensive, convenient and abundant energy sources are quickly drawing to a close.
Read full article here.
About the Author:
At the time of writing (2008) Dr. Mamdouh Salameh had considerable experience and expertise spanning 30 years in the oil and chemical industries and has held several senior management posts in the Middle East, Europe, and the UK. Dr. Salameh is currently Director of the Oil Market Consultancy Service, based in the UK, and a consultant for the World Bank.
He has written two books on oil: Is A Third Oil Crisis Inevitable? (published in London, April 1990), and Jordan's Energy Prospects & Needs to the Year 2010: The Economic Viability of Extracting Oil from Shale (published in London, October 1998), in addition to numerous research papers published in international oil and energy journals.
Dr. Salameh has a Doctorate in Economics specializing in the economics of oil and energy and a post-graduate degree in Industrial Management and Marketing.