If you are like me and you were always skeptical of the peak oil theory, you are feeling pretty smug right now. New technologies and new oil discoveries are being made daily and politicians are once again musing about America becoming energy independent. You never even hear the phrase “peak oil” anymore unless it is from some jerk like me enjoying a self-satisfied pat on the back for being right.
However, I am becoming a believer in peak oil theory’s little cousin: peak cheap oil. Or peak conventional oil, if you prefer. Whatever you call it, it is undeniable that the face of oil production is changing. Conventional oil deposits are shrinking, as are margins at the oil majors. Oil exploration is becoming more expensive and most new oil reserves are coming from deep horizontal wells, hydraulic fracturing and deep-sea drilling.
As a young investor, I figured that the world