The data comes from the United States Department of Energy's Energy Information Agency's (EIA) report on Global Oil Production, published earlier this week. The black diamonds are the global oil production numbers from excel sheet t14.
To allow for inaccuracy of measurement of the production figures, I have added error bars showing a 1% range. I have also added a binomial fit regression curve to show the overall trend.
It is fairly apparent that oil production has reached a plateau. Growth in the oil supply seems to have stopped.
By extending the best fit curve out two years, we would find that by December of 2008, world oil production would be only 82 million barrels of oil per day (mbpd). This suggests the world may have reached peak oil, the history making all-time maximum of global oil production.
For those looking at similar data two years ago, it would have suggesting an annual supply growth rate of about a 4%. At that rate, global oil production would have reached 93 mpbd by now.
With a two more years of data, even a 2% growth rate projection was optimistic. The world is no where close to 93 mbpd. It looks unlikely that production will reach that level anytime soon. In fact, the trend would have to reverse sharply in order to grow the supply to even 90 mbpd.
Global oil production is about 8 mbpd less than projections from only a few years ago. This huge shortfall represents major changes in the energy supply. It is a new paradigm, one of heralding the end of growth.
The increase in oil prices seen in the past few years is due to the inability of oil supply to increase fast enough to hold oil prices steady. Since the oil supply has failed to grow, it is the price of oil that has increased. This in turn has lead to the increase in the price of gasoline.
This disappearance of growth of the global oil supply is exactly what would be seen if peak oil were at hand. If peak oil is not now, and oil production someday reaches 86 or 87 mbpd, it is still very likely that the world is now well within the peak oil era.
This data may be an early indicator of major changes ahead.
Addendum - May 19, 2007
The EIA does not seem to have a prediction for peak oil. The EIA predictions for oil production do not show any peak at all, at least out to their furthest projection at 2030. The EIA projections suggest that oil production will smoothly increase to 102-128 mbpd by 2030. The difference in the range depends on the price level.
Oddly, the EIA prediction data shows that the higher the price is, the less will be produced. Apparently, the EIA believes that OPEC will keep production basically flat, if the oil prices are high. At the same time,the EIA predicts an enormous increase in the production of non-conventional oil. This high price oil case gets us to 102 mbpd in 2030.
If the oil prices are low, the EIA predicts that OPEC will more than double production by 2030. If price is high, unconventional production would be only a small fraction of what it would have been with high prices. Despite that, 128 mbpd by 2030 is the projection.
Other than OPEC and non-conventional oil, the EIA depends on Central America, the Caspian Basin, and Africa to bring in huge increases. Interestingly, the only area predicted to decline for sure is OECD Europe.
The predictive ability of the EIA has not been very good in the recent past. I suspect that the only way to use the EIA data to learn about peak oil is to use their past data and do separate analysis.
The EIA is scheduled to release new projections in June. It will be interesting to see how their projections change based on the failure of global supply growth over the past year.
Addendum II - May 22, 2007
For additional information on this article, visit the following:
The Oil Drum & 2
-- Great discussion on the graphs and various issues surrounding.
-- A few very interesting comments on both the binomial fit and the oil futures market.
-- Pointed out that I needed to clarify what the EIA had provided (data points), vs. what I had added (the curve and the error bars).
-- A couple of fun comments.
The Footprint - Added May 25, 2007
-- A few comments & comparison of importance with global warming.
-- I never knew there were so many news aggregators out there.
Addendum III - December 11, 2007
Republished in whole or in part at...
Addendum IV - December 16, 2007
See related post with updated graphs...
World Oil Production Extraction Supply Plateau Charts - December 2007
Peak Oil - Accurately Predicting Oil Prices & The Value of Oil
Peak Oil - Oil Prices in an Era of Plateau