Peak Oil And Its Significance

The Peak oil crisis has become a major phenomenon.increases the cost to produce crude oil. When the cost
There is a fall in crude oil exports when domesticof oil production exceeds the oil's worth then
consumption in the oil exporting countries increases.production is stopped. The drop in the production level
Extraction of oil becomes a complicated process andoccurs when Peak oil is reached.
there is a decline in worldwide oil production. Oil isIn the year 1956, the renowned geologist, M. King
extracted from the surface where it is easier to reachHubbert used the logistic theory, which is famously
and it can be easily refined. Production of crude oilknown as the Hubbert peak theory (bell curve) to
initially starts at a lower level and increases as andenvisage that United States oil production for all the 48
when more oil wells are dug. Crude oil is so significantstates would peak between 1965 and 1970. His
that it has a great impact on the economic stability,prediction was proved right when U.S experienced the
food production, transportation and trade.Peak oil phase in 1970. The crude oil production rate in
The Pressure in the older oil wells start declining asa country or region, which has individual wells, is
more water gets mixed along with the oil. To maintaindetermined with the help of the Hubbert peak theory.
the pressure, oil companies' use advanced and newThe rate of crude oil production in an individual oil field
production techniques and they start digging more oilor rig grows rapidly until it peaks at some point and
wells. Shifting from easily sought oil fields to difficultstarts declining. Various political, economic and
areas for extraction of crude oil demands moregeological factors influence oil production. Different
investment, modern techniques and more engineers.modified versions of Hubbert theory are applied though
The cost of extraction soars high, which ultimatelythe fundamental features remain constant.