Peak Oil Demand Is An Example Of The Horizon Effect

Being a grumpy old man, I have to start with the complaint that headlines which say “Peak oil demand ‘in sight before the end of the decade’ should include ‘a forecast says.’ Too often headline writers treat speculation as fact, including research results whose authors would usually not be so definitive. The former headline was from an op-ed in the Financial Times by IEA leader Fatih Birol where he actually said, “Based only on today’s policy settings by governments worldwide — even without any new climate policies — demand for each of the three fossil fuels is set to hit a peak in the coming years.“ The qualification might seem unimportant but is significant. And even with that qualification, it remains a forecast not a fact and the history of energy forecasting, including by the IEA, is a dismal one. (My record is pretty good but hardly spotless. See chapter x in my 2016 book where I include

To be fair, the International Energy Agency does a lot of attractive research and analysis on energy and their reports on electric vehicles, energy security and so forth include a lot of valuable information. But there is a big leap from data to their forecast of what they think will happen, or might happen, from what is happening. And a part of that problem, I would argue, is the horizon effect.