Foreign Policy poses seven questions to Matthew Simmons, a chief proponent of the idea of peak oil. Some of the juicier ones:
FP: Youâve written that Saudi Arabia relies on old and overproduced oil fields that are likely to start declining in output. How has Riyadh responded to your analysis?
MS: Theyâve said âtrust me, we have no problems.â? Petroleum Minister Ali Naimi said that they could pump up to 15 million barrels per day for as many as 100 more years. The likelihood of that is as remote as me being on the moon 10 years from now. They dismiss requests for any field-by-field data as preposterous, and simply say that theyâve been a reliable supplier of oil for 70 years. My view is that itâs just good supply chain management to ask a key vendor for details about their capacity. Plus, they are shopping the market so hard for drilling rigs right now. If they can produce 15 million barrels per day for another 50 to 100 years, why do they need new rigs?
FP: Which countries are best positioned to deal with a decline in oil production?
MS: Papua New Guinea. Unfortunately, thatâs an honest answer. The countries that havenât yet built a society that needs an exponential amount of oil are in the best shape. Around 30 years ago, around half the world didnât really use oil. And now look, cities like Hanoi have millions of motorcycles they didnât have five years ago. Weâve built the global economy based on the false assumptions that oil is just another commodity, that the Middle East has basically unlimited amounts of oil, technology will improve, and that the price of oil would get progressively cheaper.
The more Iâve gotten into this, the more similar it is to what we do in our own minds with ignoring people’s getting old. When do you take your parentsâ car keys away? Itâs so painful that you go into denial that theyâre getting really old.