Peak oil hasn’t happened, and it’s unlikely to happen for a very long time. A report by the oil executive Leonardo Maugeri, published by Harvard University, provides compelling evidence that a new oil boom has begun(9). The constraints on oil supply over the past ten years appear to have had more to do with money than geology. The low prices before 2003 had discouraged investors from developing difficult fields. The high prices of the past few years have changed that.
Maugeri’s analysis of projects in 23 countries suggests that global oil supplies are likely to rise by a net 17m barrels per day (to 110m) by 2020. This, he says, is “the largest potential addition to the world’s oil supply capacity since the 1980s.” The investments required to make this boom happen depend on a long-term price of $70 a barrel. The current cost of Brent crude is $95(10). Money is now flooding into new oil: a trillion dollars was spent over the past two years, a record $600bn is lined up for 2012(11).