Days are numbered for plentiful oil supply
The late M. King Hubbert was a visionary in the world of oil and, accordingly, he was either revered or reviled. Then he was forgotten. Now, in a time of oil shortage, some economists are taking a furtive look as his work.
A geophysicist at Shell Oil and later at the U.S. Geological Survey, Hubbert had the temerity back in 1956 to suggest that the days of plentiful oil were numbered. He more or less accurately predicted when production in the contiguous 48 states would begin to decline, and he was skeptical that the world could go on consuming oil indefinitely.
Hubbert was discounted by some in oil who believed that the industry, unfettered by government restraint, could produce domestically and internationally an almost infinite supply of oil.
Conservative economists of the supply-side school had no time at all for Hubbert. They believed that oil supply was a function of price and government restriction and that if the price was right and governments were held at bay, oil would gush.
Throughout the 1980s and 1990s, it appeared that they were right, as new fields came on line and improved technology increased the extraction rate. The Southern Hemisphere began to yield some oil, while the North Slope of Alaska and the North Sea were small but rich bonanzas. Hubbert seemed to have gotten it wrong.
But the same new technologies that have produced two decades of plenty may, in fact, be pushing us to the peak of Hubbert's pimple.