Peak Oil theory was devised by geoscientist M. King Hubbert; the theory states that the U.S oil production, in the long run, will reach a point where the rate of oil production would stop rising. After the peak of oil production is reached, a terminal decline ensues which indicates the halt of oil production in the future. The production curve is expected to resemble the curve of a bell, the apex of it is the maximum point of production. According to Herbert the maximum point of production would have been hit by 1970 from which the decline of production would start, his prediction was launched in 1956 (Hunt, 2016). As a matter of fact in 1970 US oil production was at a peak level. In 1974 Hubbert said that the peak point would be in 1995 his basis was on the 628 billion barrels being produced at the time. Since the 70s to early 2000 US oil production has declined, global oil production, on the other hand, has increased over time due to discoveries of newer oil fields and the improvements in drilling technologies. This leaves many people wondering if the Peak Oil theory has already occurred or was it just a fallacy created by M. King Hubbert (Agnihotri, 2015).
Arguments in Support of Peak Oil Theory
Proponent of the Peak Oil Theory believes that the rate at which oil production and wastage occur around America is a major risk to depletion of Oil reserves in the U.S soil. It is imperative to acknowledge that the rate of oil production in the 1970s was excessive and this would have led to a major peak and a steep decline after it (Murphy, 2015). The proponent of this theory believed that there is need to seek alternative energy sources in order to recuperate from the losses that can be incurred from the decline in oil production in the U.S.
A discontinues decrease in supply and the increase in oil prices predicates the matter of peak oil theory. Basing on the 2007/8 oil crisis that saw to the spike of oil prices from $50 per barrel to $147 per barrel was a key indicator of the manifestation of the peak oil theory. The 2008 recession which was the biggest after the Great Depression after the First World War was also a clear indicator of an increase in oil prices that would limit the production of oil and hence a decline in supply and usage of oil in the U.S (Hunt, 2016).
Arguments in Opposition to the Peak Oil Theory
The peak oil theory has had a lot of challenges that have seemed to manifest over the proposed theory. It is imperative to acknowledge that high oil prices encourage saving, people no longer use their vehicles whenever they want, manufacturing companies are moving towards other sources of energy like electricity to reduce usage of oil (Murphy, 2015).
High prices of energy in the 21st century has encouraged investment in efficient systems, hybridization of cars and other machinery have come in to reduce the usage of oil. Other technologies such as videoconferencing, work collaboration software just to mention a few have significantly contributed to the reduction of oil usage in transport activities globally. Investments in alternative energy sources have contributed to the reduction in oil prices. All the above points indicate the probability of the Peak Oil theory is never manifesting in the 21st century.
Agnihotri, G. (2015). Peak Oil: Myth Or Coming Reality?. OilPrice.com. Retrieved 3 October 2016, from http://oilprice.com/Energy/Crude-Oil/Peak-Oil-Myth-Or-Coming-Reality.html
Hunt, T. (2016). What Happened to Peak Oil?. Retrieved 3 October 2016, from http://www.greentechmedia.com/articles/read/what-happened-to-peak-oil
Murphy, R. (2015). aoePeak Oila Theory May Have Peaked - IER. IER. Retrieved 3 October 2016, from http://instituteforenergyresearch.org/analysis/peak-oil-theory-may-have-peaked/
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