Saudi Arabia's King Abdullah has effectively announced that peak oil is upon us (Reuters), also reported by evworld with extensive commentary.
All the speculation about when peak oil will occur has been made with certain assumptions about what Saudi Arabia can do. Now, they've effectively said "that's your lot". They're not going to increase production capacity after next year, and they're going to keep about 10% of their capacity in reserve.
That's huge news, given that they have 25% of the world's oil reserves, and are the largest oil producer and the largest exporter. Russia, second, have already announced that they can't produce more. The US is third in production, and have been in decline since the seventies. While large reserves have been found in Canada, the Canadian government has said that production there must be CO2 neutral, and in any case that oil is going to be very expensive to bring to market.
What this means is that there's no doubt in my mind that oil global oil production has now peaked, or will do so next year. The good news though, is that this economic prudence means that the decline in production will be slow. Whether this will be economically disastrous depends on whether the world can manage its oil consumption properly.
Sadly, none of this will necessarily help with climate change. The danger is that coal fired power stations, and coal to liquid technology will take off. Oh, and of course there's plenty of coal and gas left to ruin the climate.
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