Re: Re: RE: Re: RE: Yet another take on Hubbert's peak

[Doug Henwood <dhenwood@xxxxxxxxx>]

Ken Hanly wrote:

> But how do you know that your own references are so reliable. See for
> example the following on some of the problems involved:
>     http://sepwww.stanford.edu/sep/jon/world-oil.dir/lynch/worldoil.html

Very helpful link.

> In 1996, I published a piece discussing the various methods which
> were used to forecast oil supply, and argued that they, too, were
> flawed by certain repetitive errors, namely: 1) bias, and especially
> pessimism, since nearly every forecast has been too low since 1978,
> despite relying on price assumptions that were much too high; 2)
> similar forecasts for every region, despite different fiscal
> systems, drilling levels and/or the maturity of the industry,
> suggesting omitted variables; 3) misinterpretation of recoverable
> resources as total resources by using a point estimate instead of a
> dynamic variable, growing with technology change, infrastructure
> improvements, etc.; so that 4) there is a tendency for all national,
> regional or non-OPEC production forecasts to show a near-term peak
> and decline, which was always moved outward and higher in later
> forecasts (the opposite of price forecasts).


> Lynch (1996) argued that the Hubbert method fails because it takes
> recoverable (not total) resources as fixed, and assumes that to be
> the area under the curve of total production. When the estimate of
> the area under the curve (resources) is increased, the entire
> increase must be applied to future production. This is exactly what
> is happening with Campbell, as Figure 15 shows.

Campbell is one of Mark's gurus. Apparently he's been saying this
sort of thing for 15 years or more, producing forecasts that were
consistently pessimistically wrong. Mark, has he ever explained why?
Lynch says he hasn't - is this true?

Doug