Transcription and bolding by Super G.

HOST: ...Dr. Hirsch is a senior energy advisor at Management Information Services and Dr. Hirsch, thank you for joining us this morning.

HIRSCH: My pleasure.

HOST: You know, we've been talking all morning long about energy prices. Watching crude oil prices touch above $127 for the first time overnight leads a lot of people to start wondering about peak oil and the peak oil theory. You've been writing about peak oil for some time, so did you see this coming?

HIRSCH: Yes we did. Not quite the way it's turned out, but this is not a surprise.

HOST: You say, "not quite the way it's turned out". What's happened that's different from what you were predicting?

HIRSCH: Well, I wasn't particularly predicting. I'm a student of this and have focused on what we do about the problem after it really hits. Peak oil--the idea is that it would hit a sharp peak and then production in the world would hit a sharp peak then drop off. And what's happened is that we hit plateau in world oil production, and that plateau has been ongoing since about the middle of 2004.

HOST: Dr. Hirsch, there are a lot of people when we talk about peak oil who say there are going to be technologies that are always developed. There will be new ways to get oil, whether it's from coal, whether it's from the oil shales, and they say that means we will never actually hit peak oil. What do you say to those people?

HIRSCH: They're incorrect, and the reason that they're incorrect is that they don't understand the magnitude of the problem and how long it's going to take to bring substitute liquid fuels on and to introduce energy efficiency on a massive scale. That's something that we analyzed and it takes decades. And the reason, simply, is that the magnitude of the problem is enormous.

[McTeer says we should drill more.]

HOST: Dr. Hirsch, what do you say to that--the idea that we should be drilling in places like ANWR and drilling offshore. Would that solve this problem of a plateau in oil production?

HIRSCH: There's no single thing that's going to solve this problem because it's as massive as one can possibly imagine. And the prices that we're paying at the pump today I think are going to be the good old days because others who watch this very closely forecast that we are going to be hitting $12 and $15 per gallon. And then, after that, when world oil production goes into decline, we're going to talk about rationing. In other words, not only are we going to be paying high prices and have considerable economic problems, in addition to that, we're not going to be able to get the fuel when we want it.