The late Matthew R. Simmons’ greatest contribution was showing that the supply of oil is finite, said Edward Morse, the New York-based head of commodities research at Credit Suisse Group AG.
Simmons, an energy investment banker and leading proponent of the “peak oil” theory that claims the Earth is running out of crude, died Aug. 8 at 67 in an accidental drowning at his home in North Haven, Maine, local officials said. He made “remarkable contributions” in making the energy market transparent and helping the U.S. understand Saudi Arabia, Morse said.
“Perhaps the most important thing he drew attention to was the nature of decline,” Morse said in a radio interview today with Tom Keene on “Bloomberg Surveillance.” “Decline curves are real and they have to be dealt with and it’s an issue of policy as much as it is of investment.”
Simmons started Houston-based Simmons & Co. in May 1974 with a focus on the oil-services industry, according to the company’s website. The firm expanded to offer research, institutional sales and investment banking in the energy industry. Simmons promoted the idea that world oil reserves are peaking, and he explored the implications in a 2005 book called “Twilight in the Desert.”
On a tour of Saudi Arabia’s oil industry in 2003, Simmons was inspired to estimate the world’s largest oil reserves, and from research that included poring through neglected engineering data, determined that the country was close to or nearing peak output, Peter Maass wrote in his book, “Crude World: The Violent Twilight of Oil.”