Reply #36: Oil's origin might not be relevant to economics of production....

[eallen]

Even if (some) oil is produced by purely geological processes, that really has little to do with the economics of oil production. Those processes clearly are not renewing existing reservoirs on a timescale adequately short to matter to us. If there are large, extremely deep reservoirs, geologists haven't yet figured out how to find them.

Regardless of how oil originated during earth's long, long history, the economics of its production -- a short blink of the eye compared to earth's long past -- is a matter of seach and exploitation of now existing reservoirs, as driven by economic demand. Hubbert created an economic production model based on various assumptions, including (a) continuing growth in economic demand for energy, (b) the absence of cheaper substitutes for oil, (c) the economics of seach and exploitation, and (d) the absence of upside surprises in the search process. Like all models, how well it fits reality will depend greatly on how those assumptions play out. Like many economic models, even if it is right, it might be hard to make precise predictions from it looking forward. (Many peak oil proponents fail to realize that peak oil is essentially an economic model. They mistakenly think it is a geological model. That reflects how poorly they surface the economic assumptions in their own thinking.)