What's your opinion about the "Peak Oil" theory, which some experts think could be a reality as early as 2012?

Peak oil is the point or timeframe at which the maximum global petroleum production rate is reached, after which the rate of production enters its terminal decline. If global consumption is not mitigated before the peak, the availability of conventional oil will drop and prices will rise, perhaps dramatically. M. King Hubbert first used the theory in 1956 to accurately predict that United States oil production would peak between 1965 and 1970. His model, now called Hubbert peak theory, has since been used to predict the peak petroleum production of many other countries, and has also proved useful in other limited-resource production-domains. According to the Hubbert model, the production rate of a limited resource will follow a roughly symmetrical bell-shaped curve based on the limits of exploitability and market pressures.

Some observers, such as petroleum industry experts Kenneth S. Deffeyes and Matthew Simmons, believe the high dependence of most modern industrial transport, agricultural and industrial systems on the relative low cost and high availability of oil will cause the post-peak production decline and possible severe increases in the price of oil to have negative implications for the global economy. Predictions as to what exactly these negative effects will be vary greatly.

If political and economic change only occur in reaction to high prices and shortages rather than in reaction to the threat of a peak, then the degree of economic damage to importing countries will largely depend on how rapidly oil imports decline post-peak. The Export Land Model shows that the amount of oil available internationally drops much more quickly than production in exporting countries because the exporting countries maintain an internal growth in demand. Shortfalls in production (and therefore supply) would cause extreme price inflation, unless demand is mitigated with planned conservation measures and use of alternatives, which would need to be implemented 20 years before the peak.[1]

More optimistic models, which assume a delay of peak production until the 2020s or 2030s and assume major investments in alternatives will occur before a crisis, show the price at first escalating and then retreating as other types of fuel sources are used as transport fuels and fuel substitution in general occurs. More pessimistic predictions operate on the thesis that the peak has already occurred[2][3][4][5] or will occur shortly[6] and predict a global depression, perhaps even leading to a collapse of industrial global civilization as the various feedback mechanisms of the global market cause a disastrous chain reaction.

The above article is taken from Wikipedia under the article titled "Peak Oil".

The current debate represents a significant twist on an older, often-derided notion known as the peak-oil theory. Traditional peak-oil theorists, many of whom are industry outsiders or retired geologists, have argued that global oil production will soon peak and enter an irreversible decline because nearly half the available oil in the world has been pumped. They've been proved wrong so often that their theory has become debased.

The new adherents -- who range from senior Western oil-company executives to current and former officials of the major world exporting countries -- don't believe the global oil tank is at the half-empty point. But they share the belief that a global production ceiling is coming for other reasons: restricted access to oil fields, spiraling costs and increasingly complex oil-field geology. This will create a global production plateau, not a peak, they contend, with oil output remaining relatively constant rather than rising or falling.

Having worked in the oil fields in Wyoming in the late 70's and early 80's I can tell you that we have much more oil available than is being admitted to. I helped cement in over 100 wells producing 15-30 barrels each a day(light, sweet crude). Once the major oil companies are getting the price they want those fields will be reopened but only when they are getting their price. I know of at least an other 300 wells in Wyoming, Colorado and Utah that were cemented in that had been producing. How many other fields did they cement in? Only they know.

This topic is a strong passion of mine. I get frustrated at the ignorance and closed mindedness associated with this topic.

PO is a fact and will occur very soon. Projections to 2020 and beyond are not based on any data at all. One must examine the fields all over the world that are producing. Roughly 3/4 of the oil producing counties are in decline. Even Saudi is 1MBPD below its peak. Demand is steaming along at an accelerated pace of over 3% a year.

I believe supply demand will intersect this year, 2008. 2012 is way too optimistic based on any data I've come across. We are already witnessing a rapid increase in the price of oil as we approach the convergence. A rapid spike in prices, accompanied by fuel shortages (they are already being experienced in China, India and all over Africa today)

This is an economic cataclysm that will be the economic equivalent of the black plague of the 14th century in my most optimistic projections.

What am I doing? I'm fully invested in Oil futures. I've quintupled my investment since may. I am going to pour every cent into it. Make millions, keep an eye on things, prepare an exit strategy and move somewhere safe if things go really bad.

This is scary and I was upset by it at first. I've come to accept this is a natural thing and is good for the earth. There are too many polluting humans on the planet. A dieoff resulting from overshoot is very natural and healthy, objectively speaking.