UK companies present peak-oil concerns to UN

Companies across a broad spectrum of UK industry today aired their
concerns about a premature peak in global oil production, and the impact
that would have on the global economy, to a special session of the
UNCTAD Trade and Development Commission in Geneva. The companies,
members of the UK Industry Taskforce on Peak Oil and Energy Security
(ITPOES) are concerned that the oil industry collectively has its asset
assessment wrong in a systemic way, just as the investment banking
industry did in the run up to the global financial crisis. They fear
that the oil industry will be unable to meet the demands of an
oil-dependent global economy, even in the midst of recession, some time
in the early years of the next decade, with 2013 as a likely year for
the crisis to emerge. The International Energy Agency, which has warned
of an oil crunch within five years, shares such fears. ITPOES and the
IEA produced reports warning about this in the same week during October
2008 (1).

Speaking to the UNCTAD delegates (presentation by videoconference
Tuesday 9am GMT), Dr Jeremy Leggett of Solarcentury said: “many people
in and around the oil industry are now warning of a premature peak in
global oil production. Investment in oil exploration and development is
being cut back in many oil companies, as a result of the credit-driven
recession, and this makes an oil shock all the more likely down the
track, even in the face of reducing oil demand during the current
recession. The scenario we fear is that just as the world begins to haul
its way out of a recession driven by financial crisis, so it will be
knocked back into another recession by an oil crisis. We are urging
governments to mobilise proactively by fast-tracking alternative energy.
This is needed anyway, to abate climate-change risk, and enact the green
new deals that so many governments talk about as a solution to the
financial crash. But peak oil is a whole new reason for action.”

Companies in the ITPOES taskforce include Virgin, Arup, Foster and
Partners, Scottish and Southern Energy, Solarcentury, and Stagecoach.
Taskforce chairman Will Whitehorn of Virgin added: “We have been trying
to get the message out to government, fellow corporates, and the public
ever since completing our report. Imagine if five years ago companies
worth billions, across a range of industries, had been warning of a
financial crash in five years time, and a major international agency
held the same view. In taking their advice, governments might have been
a chance to soften the landing come the credit crunch. Now we know whole
industries can have their asset assessment systemically wrong. Lets not
make the same mistake twice.”