Credit: Emrah Elmasli/COSMOS
The peak oil doomsayers have their critics, and among the most combative and pugilistic is Michael C. Lynch, a research affiliate at Massachusetts Institute of Technology's Centre for International Studies and president of the Strategic Energy and Economic Research company. "I scoff at poor analysis and unwarranted alarmism," he said. "I think the current market is driven by speculation, and that we will see relief in the next few months."
Lynch derides Simmons' Twilight in the Desert as "embarrassingly bad. He includes minimal data, but the data actually refutes his arguments." He considers it "illogical" that Saudi Arabia would be pumping its oil reserves dry. "You never have a basin with a few giant fields and nothing else," he says.
And, in a 2003 article for Oil & Gas Journal, Lynch also took on the Hubbert Peak itself. Lynch outlined a "major theoretical flaw" in the "very simplistic" curve. He says that the oil pessimists rely too heavily on geology, when in fact "demand determines production, not geology."
Lynch says the Hubbert Peak only appears to have validity, since mature oil production grows very slowly, with new fields representing no more than a small proportion of existing fields. Peak oil theorists, he says, "have apparently rediscovered the Hubbert curve, but without understanding it". He denies that oil production necessarily follows a Hubbert-like bell curve, pointing to U.K. geologist, Colin Campbell's work that shows production for 51 non-OPEC (Organisation of the Petroleum Exporting Countries) nations "and only eight of them could be said to resemble a Hubbert curve even approximately". The Hubbert curve, Lynch argues, "originally held as scientific and inviolable, is of no particular value".
The truth is, Lynch is one of the last bears on oil prices. He regards oil crises as short-term affairs, and the general price trend is actually downwards. "The possibility of a price drop so rapid that OPEC can't stabilise the market at the level they want is real," he said in May 2005. In this, Lynch directly challenges such respected oil observers as investment house Goldman Sachs, whose analyst Arjun Murti in March 2005 suggested crude oil prices might go as high as US$105 a barrel by 2007. "We believe oil markets may have entered the early stages of what we have referred to as a 'super-spike' period - a multi-year trading band of oil prices high enough to reduce energy consumption meaningfully and to re-create a spare capacity cushion only after which lower energy prices will return," Murti forecast.
