STEVE INSKEEP, host: This summer's record-high oil prices have some people thinking about the future of petroleum. Oil supplies are tight, which raises the question of how much oil might be left. The question matters because oil doesn't just fuel your car. It dominates much of the world economy. Oil companies are seeking new discoveries from the deserts of Iraq to the ice of Greenland, but some industry veterans think that as the years go on, it will only get harder to keep up with demand. One of those veterans is T. Boone Pickens.

How long you been in the oil business?

Mr. T. BOONE PICKENS (Oilman): You're really — I've been in the oil business since 1951. How long is that, 100 years?

INSKEEP: Pickens has spent those years as a geologist, oil executive and corporate takeover artist. He's one of several people we consulted on the future of oil production and what it means for all of us. Pickens answered the phone at his Texas ranch, and he suggested that the rate of oil production has already topped out.

Mr. PICKENS: The world is producing 82 million barrels of oil a day, globally. I think that's all we'll ever have. So you have a supply situation that is not going to get any better and you have a demand that's going up.

INSKEEP: Can't you drill more wells?

Mr. PICKENS: Well, you can drill more wells, but you're dealing with decline curves and all and when older fields start to go down, they go down pretty rapidly.

INSKEEP: When you say decline curves, you mean that there are fields that are going to be tapped out in the coming years that will be very hard to replace?

Mr. PICKENS: That's exactly right. I think you're peaking now, is what it is. I think you're right on it.

INSKEEP: If that's the case, how will the world be a different place over the next 50 years than it has been over the last half century that you've been in business?

Mr. PICKENS: Well, you know, look at the hydrocarbon era. Just step back a little further and look at the picture. The hydrocarbon era started with the car in 1900. And you're — now have peaked on production just about 100 years out. You're going to be out of the hydrocarbon era in 2100, and you're going to go to other fuels.

INSKEEP: T. Boone Pickens is a believer in the peak theory of oil production. That theory suggests that oil production will hit a ceiling and then gradually decline. Working from the same estimates of world oil reserves, experts have made different calculations for how quickly we'll pump it out. Some expect to peak in 10 or 15 years, others forecast it will take 40 years or more. And then there's Kenneth Deffeyes, a professor emeritus at Princeton University.

Professor KENNETH DEFFEYES (Princeton University): I'm predicting that the world peak, smoothed out, is going to fall on Thanksgiving Day 2005 with an uncertainly of only about three or four weeks on either side.

INSKEEP: Will the production rate go down, as you see it, slowly enough that governments and countries will have a chance to adjust?

Prof. DEFFEYES: Well, if we were paying attention, we could adapt to it. We should have been paying attention to this 15 years ago.

INSKEEP: That's because a decline in the oil supply could affect the price of everything from gasoline to computer keyboards made with plastic, which is a petroleum product, not to mention everything else that's transported by truck, plane, ship or rail. Although some experts find Kenneth Deffeyes far too pessimistic, everyone agrees on one point — there's only so much oil in the world. There are several possible scenarios for a future with less oil as we learn from Paul Roberts. He's the author of a book called "The End of Oil."

Mr. PAUL ROBERTS (Author): If it turned out that, you know, within a year we were going to have to move into an entirely new regime of oil price — that is, get used to $60 or $70 barrel oil, forever — that would be a traumatic adjustment for the economy, because oil not only supplies, you know, 40 percent of the world's energy, but more importantly it supplies about 93 percent of the transportation fuel. This economy is based on transportation. You know, there's no replacement for oil — there is for gasoline and diesel — at least nothing right away that's cost-effective. So you'd have to re-engineer your economy and do it in a year, and it couldn't happen, so you'd have severe dislocation. You'd have recession like nothing we've ever seen before. And I'm afraid you'd probably have a pretty nasty competition for the remaining oil supply.

INSKEEP: What's you're laying out is a hypothetical scenario, not necessarily a prediction. There's another hypothetical scenario if this oil peak is 15 years out or 30 years out or 40 years out.

Mr. ROBERTS: Well, absolutely. And that's kind of what we hope for. And maybe we're seeing the beginnings of that where price gradually rises, and as that happens, it gooses the economy, it sends the signals to the economy that it needs to adjust. One of those adjustments would be to become dramatically more fuel-efficient. We know we can do that. It may be that we simply can't live the same way we do. Whether that means, you know, declining living standards remains to be seen. But we're — there will have to be substantial changes.

INSKEEP: The author, Paul Roberts, says the world can change in time. Oil companies adapted to oil shocks in the 1970s, making more efficient cars. But today, the demand for oil is soaring around the world. Prices have risen high enough to slow down economic growth in the United States. And when you call a commodities trading firm, you're likely to hear a very busy office.

(Soundbite of office workers)

Mr. PHIL FLYNN (Commodities Analyst, Alaron Trading Corp.): Did you go to the market on that? You there?

INSKEEP: Phil Flynn is a commodities analyst with Alaron Trading. He says his colleagues aren't really worried about a peak in oil production.

Mr. PHIL FLYNN (Commodities Analyst, Alaron Trading Corp.): I think most of them don't think that far out in the future, to be honest with you. I think that they look more three to six months to a year down the road. And, you know, these long-term projections about the end of the oil age, you know, as we know from the past, have been somewhat premature before. In fact, if you remember back in the 1970s, everybody thought we'd be out of oil by the year 2000. Well, here we are at 2004 and we're not out of oil yet. I believe the oil is there. And with oil prices being at these levels, we're going to get a lot more inventive on ways to find it.

INSKEEP: Although you raise an interesting point there. In order for extra exploration to be cost-effective, the price of oil has to go up and stay up.

Mr. FLYNN: It does. And, I mean, and to be honest with you, oil has been historically inexpensive for, when you adjust for inflation, many years. Oil has been one of the cheaper commodities out there. Now that we're near record highs, where basically demand is almost outstripping supply, everybody's saying, `Well, see, we're ending the oil age.' I don't really believe that, but there's no doubt, for the next couple of years, supply and demand's going to be very tight.

INSKEEP: In that at least, the commodities analyst Phil Flynn agrees with T. Boone Pickens, that oilman we heard a few minutes ago. They both think supplies will be tight for some time to come. It's just that Pickens believes the supply may never ease up again.

Mr. PICKENS: If I've missed on peaking, I've only missed briefly. So it's not something as, `Oh, well, that old codger, he panicked early. And it's not in '04. It's going to be in '08.' OK, well, you're going to — we're going to deal with it because the world is permanently changing as far as energy's concerned.

INSKEEP: T. Boone Pickens says he's been buying oil at this summer's high prices, and he's buying it for future delivery in the year 2011. He's betting that years from now oil prices will remain at least as high as they've been this summer.

The time is 29 minutes past the hour.