So far, supply-side Peak Oil is a myth... so far. Although, prior to the hydrofracturing boom, it wasn't for the United States.
|M. King Hubbert's Peak Oil predictions based on reserves.|
Source: M. King Hubbert via The Automatic Earth.
|Actual US Oil Production 1900 through 2015.|
Enter fracking, and mutatis mutandis, no more Peak US Oil!
Source: The Automatic Earth.
|Oil price History 1974 through 2014.|
Source: The Huffington Post.
|Oil Price History 2006 through end 2015.|
Source: The Motley Fool.
The Motley Fool article asked if another price spike was underway, and indeed a small one did come about, and hit about $60 or so per barrel, but quickly collapsed when China cracked down on commodities speculation. It's now about $45 per barrel. Where the oil price goes now depends on how big the continuing supply is, and how strong or weak the demand is. Whether the oil industry can make a profit on the price is a different story.
The oil extractors at least in the United States and Canada have managed to get their costs down, at the expense of future investment, but some, especially small-time frackers, are pumping as much as they cam just to meet service payments on their debt! Oil-producing countries, on the other hand, have social welfare safety nets to take care of, which hikes their break-even oil price requirements considerably. Of course, some like Russia are somewhat lucky, because their internal costs are in the local currency, and shrink in relation to the world price which is in US Dollars, due to drop in the currency for whatever reasons (in the case of Russia, US sanctions causing reduced trade with Europe). Even so, some companies have gone under, other companies have shut their wells, and the daily production has dropped as a result.
|Latest peak production was in July 2015. Production has been shrinking by 2% per year since.|
Source: The Automatic Earth.
Now it may be that the price of oil may go back up again, if the demand trend line shown above continues. If it spikes back up far enough, the financial sector, now reeling from default by the "oil patch" companies (but not as bad as it did from the bursting of the housing bubble), may choose to invest in oil extraction and the development of oil extraction technologies again. On the other hand, they may not, and in which case a rise in production may not occur until there are lines at the gas stations. And if there has been a considerable amount of disinvestment in and neglect of the oil extraction infrastructure, the daily production rates may never see the peak attained in 2015 ever again! But then again, it might, or even exceed it. At any rate, we could be in for several cycles of price collapse, financial fallout, production drop, shortage, price spike, reinvestment, production rise, glut, and price collapse, rinse and repeat, until the physically and economically feasible oil extraction drops remorselessly. Natural gas extraction and coal mining may accordingly drop along with it.
In which case... voila! Supply-side peak oil becomes a reality, thanks to demand-side peak oil attained in mid-2015.
Here are Raúl Meijer's concluding thoughts (read the article) on the matter, which I believe is similar with my thoughts above on the future of fossil fuels' extraction.
And I will add: what sorts of innovation? Wind, hydro, solar, nuclear if it weren't so dodgy, and biofuels if they didn't take food out of the mouths of the poor.
Besides, we have a soon-approaching abrupt and civilization-wrecking climate change coming up.