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Oil substitution and the decline in conventional oil

Peak in demand for conventional oil

In oil depletion analysis, it is commonly assumed that conventional oil demand will continue to increase beyond the stage at which production must decline and fall due to geological constraints. In this analysis, we attempt to understand whether another possibility might occur: might demand for conventional oil decline before geologic constraints become binding?  This might occur due to efficiency improvements, saturation for travel demand in wealthy countries, substitution with alternative non-liquid energy carriers such as electricity or natural gas, or substitution with unconventional liquid fuels such as oil sands, synthetic fuels, and biofuels.

 

In order to support this analysis, we have developed the Interactive petroleum Demand EStimation (IDES) model.  IDES allows any user to download the analysis tool used in this paper and to adjust model settings in line with their beliefs about future rates of technology adoption, demand increases, and economic growth. 

 

Published papers

 

Current IDES model and supplemental documentation

  • IDES model documentation [PDF]
  • IDES model version 1.0 [XLSM]