CERA: Peak In 2020, Not 2005

An AP story quotes Cambridge Energy Research Consultants as saying peak oil production will hit in 2020 rather than in the near future.

In a report that builds upon earlier analyses by the Cambridge, Mass.-based consultancy, CERA said it believes that between now and 2010 there will be a substantial increase in worldwide oil production capacity. It said that "as a result, supply could exceed demand by as much as 6 million to 7.5 million barrels per day later in the decade" that will lead to an extended period of lower prices beginning as early as 2008.

The price of oil could "slip well below $40 a barrel as 2007-08 nears," CERA said.

Contradicting Matt Simmons' projections about the Saudi oilfields, CERA claims that even without large new discoveries, more oil can be extracted from existing fields.

"The main risks to our supply expansion scenario are above ground, not below ground — changes in the political and operating climate that could delay expansion," [CERA chairman Daniel] Yergin said.