Thursday 6th October 2005 AD
"WAKING FROM OUR ENERGY SLUMBER"

Generally one likes to start the day slowly, fairly low key and with a rich, smooth mountain grown Panamanian coffee. But that wasn't the case this morning. I was on the phone early, speaking with Mr. Paul Roberts, renowned author of the book "The End of Oil". 

A chat with Paul certainly shakes you from your slumber, whether it be that of the morning, or the slumber that appears to have fallen over most of the western world after living in a seemingly endless age of cheep energy. "Demand is up steadily" Paul answered, "we are now seeing producers having to work harder JUST to keep production steady, to say nothing of lifting it in the future."

Paul went on to speak of 'Optimism & Energy Illiteracy', 'Global Energy Geo-politics', 'Energy Alternatives' and address a bunch of other questions, "I think one of the reasons prices are so high today is that traders and consumers are starting to see that producers are not able to supply all that added production that they talk about. Smaller producers are in decline bringing added pressure on bigger producers like Saudi Arabia and Russia. 
It isn't even clear that Russia will be able to significantly raise production despite its vast reserves."

On OPEC simply 'opening the tap' and raising production Paul responded, "It is not really a matter of choice for them, it is a matter of how much can they possibly produce now? Most of them are pretty much tapped out. If you look at spare production capacity, that is the extra oil production that is being held in reserve, production that is there to be used in emergency, that reserve is quite small today. It is maybe less than 1 million barrels per day, where it used to be 4 - 10 million barrels per day. That to me tells the whole story."

"Yes, we will be looking at much higher oil and natural gas in the future" finished Paul. "Another coffee?" asked one of the girls as I hung up the phone. "No, that wont be necessary this morning thanks" I replied.

Best Regards - Philip Judge pjudge@anglofareast.com