There are various definitions of peak oil - the "hard" one being actually declining production, with a "soft" version being production unable to catch up with latent demand and prices increasing instead. Then you can measure it for oil alone, or for oil plus various liquid substitutes that we are increasingly using (ethanol, processed tar sands, coal-to-liquids, etc...).

With the above quotes (repeated again below), Bush is clearly into "soft" territory, and could be argued to be in "hard" territory. There is no longer any argument in the industry that non-OPEC oil is peaking (that includes the International Energy Agency and even ExxonMobil), which means that any production increase must come from OPEC. If they are also producing "full out", you can reach your own conclusions....

And this was not just an isolated assertion by Bush - the topic was disucssed 3 separate times in the interview:

I also understand the dynamics behind the issue, and that is growing demand from U.S., but more particularly, China and India, relative to supply.

Oil is a commodity; it isn't something you just turn a tap. I mean, it requires investment, exploration, a lot of capital. I talked to His Majesty early on in my presidency in the hopes that they would explore for new fields; they have. They've increased their capacity. But in the meantime, demand has gone up quite substantially.

Note that Bush states that Saudi Arabia has increased its production capacity since "early on in his presidency"; and yet Saudi production was as follows (according to the BP Review of World Energy 2007):

Year production (mb/d)
1997  9.48
2000  9.49
2001  9.21
2002  8.93
2003 10.16
2004 10.64
2005 11.11
2006 10.86

as this graph over at the oil drum suggests, production has been flat for a large part of 2007, which means that Saudi Arabia, holder of 22% of world reserves - and 30% of OPEC reserves) grandly increased its production by 1.5mb/d in 10 years, when demand increased by 10 mb/d (or 8mb/d since 2000), ie much below its supposed share of the remaining resource.

If they are producing "full out", having increase capacity, we're in trouble because, as Bush states, demand has not stood still in the meantime - and that demand, in a major change from the past, is not coming from the US, but from China, India, and the oil producers themselves (BP statistics show that Saudi internal consumption jumped from 1.5mb/d in 2000 to 2.0mb/d, which means that fully one third of Saudi Arabia's production increase went to domestic demand).

Again, Bush is at least accknoledging the "soft" version of peak oil.

I would like for them to realize that high energy prices affect the economies of consuming nations. And that if these economies weaken, those economies will eventually be buying fewer barrels of oil. And having said that, there is not a lot of excess capacity in the marketplace. What's happened is, is that demand for energy has outstripped new supply. And that's why there's high price.

That's the third time he said it. It may sound like "it's not my fault" and "it's not my pals the Saudis' fault either", but it certainly is quite an admission of helplessness viz. reality.

Will that lead to actual policies to solve the issue? We know that it won't until 2009, but it would be nice if the Democratic candidates jumped on this admission to push for radical energy reform.