Approximately 48% of U.S. E&P chief financial officers believe that the world has reached its peak petroleum production rate or will reach it within the next few years, while another 52% disagree with that statement, according to a new survey by Chicago-based national professional services firm BDO Seidman LLP.
The BDO Seidman Natural Resources 2009 Outlook survey was conducted by Market Measurement Inc. in the fourth quarter and included input from 100 U.S. E&P CFOs.
The survey finds there are similarly differing opinions in predictions regarding when the world’s demand for petroleum will peak—31% believe it will be in less than 10 years, 43% believe it will be in 10 to 20 years, 14% believe it will be 20 to 30 years and 8% think it will reach peak more than 30 years from now.
BDO Seidman partner and national energy industry practice leader Charles Dewhurst says, “I think perspectives have likely shifted dramatically in recent months on whether the world is nearing a peak level of petroleum production. If you had gathered opinions only six months ago on this issue, most were worried that existing sources were drying up. Now, people are hedging their bets.”
Most (64%) CFO respondents believe renewable energy sources will comprise 8% to 12% of the market in the next five years; currently, these sources make up 7% of the U.S. energy supply, according to the U.S. Energy Information Administration. Nearly one-quarter of respondents (22%) believe market share will double to 13% or higher. Another 14% believe market share will remain less than 8%.
Dewhurst says, “With oil prices and demand down, the profit incentive for alternative energy has also dropped. However, once we come out of the recession, those companies who were able to plan or even begin to implement green initiatives will be well-positioned for the renewed boost in demand.”
In terms of reducing U.S. greenhouse gas emissions and putting caps on carbon emissions for U.S. power plants, oil refineries and other pollution sources, 33% prefer federal regulation to state regulation, 31% percent prefer state legislation and 37% percent believe the industry should be left to self-regulate.