| Bell-shaped Curve: In statistics, a bell curve represents a distribution of data or probabilities that display a single peak before and after which there are steadily declining slopes forming the shape of a bell; this distribution is often known as a “normal” distribution. |
| Hubberts's Peak Theory: The hypothesis that oil production – both in individual fields and in global reserves considered broadly – will eventually peak and decline according to predictable patterns based on a bell curve. |
| Reserves: In an energy context, reserves refer to deposits of energy that have yet to be exploited and are thus still in storage. |
| Peak Oil: The theoretical point at which production from global oil reserves will begin to decline. There is an ongoing debate about when this point will be reached or whether it has already been passed. |
| Proven Reserves: Reserves whose existence and size have been confirmed by expert analysis, as opposed to unproven reserves whose existence may be mere speculation. |
C. Hubbert's Peak Theory
In 1956, a geophysicist named Marion King Hubbert hypothesized that all rates of oil production follow a bell-shaped curve and will eventually peak and decline according to predictable patterns. This theory, now known as Hubbert’s Peak Theory, applies to both individual oil fields and to global oil reserves as a whole. When global production reaches the highest point of the bell curve, it will have reached the point of Peak Oil. Hubbert correctly predicted that U.S. oil production would peak around 1970. His guess that global production would begin to decline by 2006 has been widely discussed and criticized.1
Many experts reject the idea that the world has reached Peak Oil. They point out that, even with current levels of technological sophistication, there is still much that engineers do not know about oil reserves in many parts of the world. Just as there was “much more oil hidden under the earth’s surface than most people imagined back in the 1970s,” so too are there probably additional reserves that have not been identified by today’s oil producers.2
The most optimistic observers claim that, “For the next 25 to 50 years, the oil available to the market is for all intents and purposes infinite.”3 They point out that, “Thanks to the cold war and other political constraints on western investment, much of the world has yet to be explored with the aid of the latest technologies.”4 The vast majority of exploration over the last two decades has been in North American countries scrambling to reverse declining production. Only 3 percent of global oil exploration has occurred in the Middle East, “even though the region holds about 70 percent of proven reserves.”5
The Hubbert’s Peak Bell Curve
Source: http://www.hubbertpeak.com/hubbert/1956/1956.pdf
1 “Peak Oil Primer”
2 “Will the Oil Run Out?”
3 ibid.
4 “Bottomless Beer Mug”
5 Maugeri
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