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Oil as a finite resource

When is global production likely to peak?

Energy is the lifeblood of the world's economy, the underlying means by which modern societies function. The interruption of supplies by natural or man-made events demonstrates how totally dependent we have become on the energy-consuming machines.

Executive Summary

The skyrocketing gasoline and diesel fuel prices of winter and early spring 2000 are the direct result of a deliberate, if modest (about 4 percent), reduction in global crude oil production by the OPEC cartel.

The demonstrated sensitivity of oil product prices to a relatively small reduction in supply should serve as a sober example of what could well happen in the relatively near future when global crude production begins its inevitable decline, not as a result of an OPEC decision, but of an inability of producers to continue expanding production of what is, ultimately, a finite resource.

The likely timing of this peaking and decline is the subject of this paper.

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