The world's overflowing oil reserves?

Discussion in 'Current Events' started by iGav, Apr 20, 2004.

  1. wdlove macrumors P6


    Oct 20, 2002
    A very good article iGAV.

    "However, we have potentially got another 100 years of oil production. Yet as it becomes more scarce, prices will no doubt go up, and there will inevitably have to be a gradual move to alternative power sources."

    This isn't a political problem, but needs to be solved for economic reasons. We are currently under the control of the oil companies and OPEC. Both do not want us to proceed with alternative fuels.
  2. Savage Henry macrumors 65816

    Savage Henry

    Feb 20, 2004
    in a one horse, two house, three pub town.
    When I was a kid I was always being told that "in 30 years time we will run out of oil ..." It didn't take me long to realise how ignorant adults were back then.
  3. michaelrjohnson macrumors 68020

    Aug 9, 2000
    according to some reasearch that I did last year about this time. I gathered sources from various places including the EPA, various newsmagazines, etc. According to that research, the United States alone would and could consume ALL of the world's known oil reserves over the next 100 years. That INCLUDES ANWR and other "no-no" drilling places. Keep that in mind. PLEASE be environmentally friendly, and reduce your consumption. Thank you. :)
  4. Frohickey macrumors 6502a

    Feb 27, 2003
    Don't think the oil companies and OPEC has a choice. When a manufacturer runs out of a product, they have lost all power over the market. (Same when a consumer runs out of money.)

    So, the ONLY choice the oil companies and OPEC has, IF OIL WILL RUN OUT, is to stall for more time in order to allow them to develop alternative power sources, and maintain their continued survival and profitability as suppliers of energy for consumers.
  5. krimson macrumors 65816


    Oct 29, 2003
    Democratic People's Republic of Kalifornia
    I read another article a few months ago that said, maybe 40% (i can't remember the exact %) of the oil is locked up in sand/shale or other hard to extract substrates. Until the technology is developed that can extract it at a marketable price, that stuff is basically off limits.

    On the other hand, im investing in the turkey gut alternative fuel production companies. :rolleyes:
  6. Frohickey macrumors 6502a

    Feb 27, 2003
    biased journalist alert!!!

    Why is this a bad thing? I contend that this is the proper and most efficient way to use oil resources.

    It takes money, time and effort to extract oil. Why extract oil if you are not going to consume it? If you put extracted crude oil into a half-full barrel and let it sit in a shelf, will it become a full barrel a few years later? No.

    This is not the same with money. If you get some money, put it in an interest-bearing account, and let it sit on a shelf, it will increase in size a few years later. So, why spend the money to extract oil? Better to leave the money in an account, than use it to extract oil that is not consumed (sold) to earn you more money.
  7. whocares macrumors 65816


    Oct 9, 2002
    Untrue. Present day recovery rates for a typical oil field vary between 60 to 80% (ie 20 to 40 are never extracted). As technology improves, more oil is recoverable. And a field drained down to the last marketable drop today may not see further improvement in the future, as recovery techniques can be conflicting.

    Conservative estimates of world reserves are 50 years for oil and 100 years for natural gas. The biggest problem however is not the amount of reserves (in number of barrels) but the consomption rate of the world (in barrels of oil/day). The biggest unkown is the increase in consomption in emerging economies. What do you think would happen when most Chinese get a car?
  8. JesseJames macrumors 6502a

    Mar 28, 2003
    How'd I get here? How can I leave?
    Okay then, I'll gas up my supercharged black car replete with trusty mangy mutt sidekick.
    I'll put on my road leathers and shoulder pads with a sawed-off shotgun in a holster. Grow a stubbly beard and wander the hinterlands for fuel.
    Adapt a el lobo solo attitude and a thousand yard stare.

    Seriously, fuel cell power has to come online soon. It just has to work. Hydrogen must be the fuel of the future. Even if the oil doesn't run out in 200 years time.
    Don't forget that the birth-rate of developed countries has significantly dropped while the population gets older. The U.S. and Europe will eventually lose a lot of political cachet in the world. They will still be big players of course but there are up and comers.
    Whereas countries like China and India has had a population boom and they are developing. FAST. How are they going to fuel their growth? OIL. Fossil fuels of course. It's the fastest and cheapest way in the short run.
  9. stoid macrumors 601


    Feb 17, 2002
    So long, and thanks for all the fish!
    I think that the main reason that alternative fuel sources have yet to take off is because they are still more expensive than fossil fuels. While the new hybrids and other fuel efficient cars are going to continue to come down in price, they will always be more expensive than getting a 15 mpg car and regular unleaded gas at $2 a gallon. Once gas prices creep up to $5 a gallon (it'll happen) people will find cheaper ways to get around. It's simply a matter of finance. While fossil fuels are the cheapest most reliable source, they will be used until they become so expensive that other sources will take over.
  10. Frohickey macrumors 6502a

    Feb 27, 2003
    Everyone would have to increase their auto insurance coverages? :p :D :eek:
  11. Frohickey macrumors 6502a

    Feb 27, 2003
    Pretty much the same way other technologies have fallen away, and new technologies have come to the forefront.

    Don't need any political non-solutions muddying up the market. It will figure itself out, on its own.
  12. howard macrumors 68020


    Nov 18, 2002
    i've been warned before that news articles saying there is not enough oil are written by green party associates and articles that say there is plenty of oil are written buy associates of an oil firm. what the truth is i can't say.

    I personally think we should develop technology away from oil as a resource and more on an environmentally friendly and much more efficient type of energy. spending gobs of money on drilling oil which will pollute the earth even more, when the oil will no doubt be gone one day anyway seems ridiculous to me, why not use our technology and power to develop better more efficient forms of energy?
  13. Makosuke macrumors 603

    Aug 15, 2001
    The Cool Part of CA, USA
    How much oil is left in the ground--the main question that article seems to be addressing--is, in the short term, and irrelevant point. The question is how much can we get out, because as soon as the rate of extraction starts to fall off, the price will skyrocket, since nobody wants to use less fuel. relatively inelastic demand coupled with relatively inelastic supply equals massive price increases--basic economics.

    And how fast can we get oil out of the ground? I don't know myself, but the figures for how much is being sucked out and ballpark numbers for how much is left are easy to find.

    The US uses more oil than any other country in the world. We also pull more out of the ground--slightly ahead of Saudi Arabia. The difference is, by even relatively optimistic estimates, the US only has about two decades of oil left in the ground (even if you factor in tiny reserves like the Alaskan one) at current rates of extraction (and production doesn't just stop suddenly--it falls off).

    That means that the largest producer of oil in the world can't continue to produce oil at the current rate for a whole lot longer. With worldwide demand rising (China and India, anyone?), that spells big shortage in the disturbingly near future--certainly well within my lifetime.

    Saudi Arabia, the country sitting on the most oil by far, has reserves on the order of ten to twenty times what the US does, so they could theoretically double production to take up the slack and still have their underground tank last another 50-100 years.

    Will they? Why? If supply goes down, prices skyrocket, and their profits go right along with that. If they increase supply, they keep prices more stable and deplete their reserves faster--which would you do given that choice?

    So, basically, something's got to give--demand will decrease "on its own" due to alternatives and efficiency, prices will get so high that people have no choice but to try something else, or somebody will have to force Saudi Arabia and other OPEC countries to drastically increase production.

    Sadly, that last option seems the most likely, so I only hope it's peaceful. I wouldn't be at all surprised if that's part of the reason the US government was so interested in taking control of Iraq--that was the impression that some people had, anyway (quote from trucker radio, 2003: "When gas hits $2 a gallon, they'd better start dropping those bombs.").

    What I wonder is why people are so dead set on not getting a bit more efficient and finding some alternatives--no matter how optimistic you are, we're still going to run out of oil in a century or two, and most indications are that heavy fossil fuel use is doing bad things to the global climate, so why not get a head start, just in case?
  14. Makosuke macrumors 603

    Aug 15, 2001
    The Cool Part of CA, USA
    By the way, if you're interested in real numbers by a relatively impartial source, you can check out the US Department of Energy Energy Information Administration's statistics on world oil:

    That's a heap of info, but boiled down, the world currently uses about 77.5 million barrels of oil a day. That's 28.3 billion barrels a year.

    The US currently has 22.4 billion barrels of oil sitting under the groud. OPEC has about 823 billion, and the rest of the world has about 186 billion.

    That means that at current rates of extraction, the US (pumping 5.8 million barrels a day) has just over 10 years of oil left. OPEC (26.4 million barrels a day) has 85 years left, and the rest of the world (34.7 million barrels a day) has about 14 years.

    The scary part is when you total up total reserves and total use; at current rates of use, the US government (not some Greenie organization with an agenda) thinks there are 36 years of oil left in the ground. In fact, even if the US was the ONLY country using oil, and our rate of use didn't go up, there'd only be 143 years left.

    Even if these numbers are pessimistic, they are for TOTAL reserves; in reality, it gets harder and more expensive to suck those last few barrels out of the ground. That points to something giving within a couple of decades, maybe a lot sooner. It won't be Mad Max, but I don't think you'll see everybody in China driving to work in Hummers.
  15. Frohickey macrumors 6502a

    Feb 27, 2003
    There is nothing stopping any organization from developing alternative energy sources. But what the environmentalist lobby would like to do is use the heavy hand of government to FORCE companies. Sorry, but I don't want government to have the power to be able to FORCE companies to do certain things. (It might be that way already, but its still wrong.)

    When was the last time you saw government give up an expansion of government power?
  16. Frohickey macrumors 6502a

    Feb 27, 2003
    As said in other posts, if the price of energy rises sufficiently, other alternative energy sources become more attractive, and will be developed. That could set a new equilibrium price for energy if the alternative source is sustainable into the future. So, the Saudis have a tightrope to walk, too high, and alternative energy sources get developed, and they lose their market status. Too low, and they deplete their reserves faster, leading them to lose their market status.

    I can't speak for other people, but I'm not dead set against getting more efficient and finding alternatives. I'm dead set against granting government more power with which to manipulate the market. The market can take care of itself, as stated in the earlier example of Saudi raising/lower production. Alternative sources *WILL* be developed, when the economic conditions warrant it. Besides, its *MORE EFFICIENT* to let the market decide the time and manner of development of alternative sources.

    In the scenario of government intervention, what is there to prevent a government flushed with the power to intervene in the market (mandated) from intervening in future markets if certain politicians vote for such an action? Some people are putting too much trust that government will always be benevolent.
  17. Backtothemac macrumors 601


    Jan 3, 2002
    San Destin Florida
    Well, I for one am doing my part. I have traded my MPV mini van and Probe GT for an Accord and VW Golf. A friend of mine is taking minerology this semester at the University, and today of all days we were looking at stats, and it said that the Saudi's along have 646 billion barrels in reserve.

    Oil is here, it is king, and it isn't going anywhere until there is massive proof that we are killing ourselves, and our environment. It is sad, but I think it will take another 20 years to get alternative fuel vehicles common in the US and Europe.
  18. Makosuke macrumors 603

    Aug 15, 2001
    The Cool Part of CA, USA
    Your argument is half of a good one--alternative energy is becoming more affordable every day, and before too long it may well be price competitive, causing further development, but you're ignoring a huge issue:

    Governments already exert undue influence over the energy market, causing drastic inefficiencies. Were oil to operate on a fair playing ground, then it'd already be more than cost effective versus most alternative tech--I'm all for that, as would any environmentalist with half a brain.

    There are HUGE government subsidies in the US that go toward the maintenance of an oil supply, and disproportionately smaller subsidies benefiting other technologies. Add pollution externalities in, and oil "costs" a whole lot more than consumers are paying for it directly, with costs instead being met from taxes, debt, and non-monetized externalities. That is every bit as "broken" a market as one in which government supports or mandates alternate technologies.

    There are three other issues if you want to go at the issue in a completely economic way:

    1) The oil industry is a partial monopoly (OPEC, which has already illustrated to be making undue and INEFFICIENT profits from its cartel status, and sits on 2/3 of the world's oil), and any economist will tell you that monopolies are inefficient and destructive to a well-functioning economy.

    2) Economic solutions only function as long as there is proper information in the marketplace, allowing for informed decisions based on future price and availability. What happens if we think there's plenty of oil, so prices stay relatively stable, alternatives are not developed, and rate of extraction does not go down, but that information is incorrect? In 20 years you could get a sudden falloff in production, which goes beyond the short-term capacity of the world economy to effectively deal with, causing anything from a global recession to the fall of governments.

    3) Current oil prices in no way reflect the potential effects of global warming, due to the gradual timescale on which they happen and the common-pool resource nature of the issue. If there is no global warming, then we're fine. But if there is, then the environmental costs in 50 or 100 yeras could be tens or hundreds of times the current net benefit from oil extraction, leading to massive overall economic inefficiency.

    I'm not saying government regulation is the solution (it rarely is), but thinking that the current energy market a standard, well-functioning economic market is rather ill-informed.
  19. Frohickey macrumors 6502a

    Feb 27, 2003
    Current energy market is what it currently is. So far, all the changes to it that people have proposed push it away from a standard, well-functioning economic market.
  20. satty macrumors 6502

    Mar 1, 2004
    You can't beat Wellington on a good day
    Peak oil

    To my surprise nobody here mentioned the term "peak oil" (maybe I just haven't seen it).

    I think it is totally naiv to believe we have enough oil for the next 100 years. Actually I am sure we will still have oil in a 1000 years time, but that's not the point.

    I don't want to scare monger here, but here are some important issues for a discussion:
    - Peak Oil (Hubbert's Peak)
    - Energy equity
    - New oil (field) descoveries
    - New oil technologies
    - Worldwide oil consumption

    Peak oil
    Every oil field is following the Hubbert curve, which is a bell shaped curve (Graph). As you can easily see, the production of a oil well will hit a maximum and afterwards it declines. You only can change the speed of the decline by better technology (more expensive). Sometimes you reach a point (before the well is totally depleted) where you have to invest more energy than the energy of the oil itself, so noone will pump that oil out of the ground.

    America reached the peak, the maximum production of their oil wells, already in 1970! As far as I know all oil fields outside of the OPEC already peaked

    New oil field discoveries
    At the beginning you find normally the big oil fields and later medium sized ones and finally you find only very small ones. The biggest oil fields on earth were discovered all before 1970! Since than the only bigger oil fields were discovered in the North Sea, which also already peaked.

    At the moment the ration between produced oil and newly discovered oil is about 4 : 1.

    Most of the OPEC nations have increased the predictions of their oil resources for political and economical reason, not because of new discoveries (Presentation). That's why shell had to decrease their reserves by over 20% this year!

    Most geologist expect the world oil production to peak within the next months! Afterwards it is expected that the oil production will fall by 3% each year.

    We just can hope that the OPEC nations didn't overestimate their reserves, because otherwise we wake up in the morning and their is no gas at the pretrol station.

    Worldwide oil consumption
    The worlwide oil consumption is - on the other hand - far away from peaking. China increased the consumption by 18% last year and it#s expected that they will increase by minimum 15% this year.

    I expect (like many geologists and financial experts, i.e. Matthew Simmons) that we will have a major energy crises in our life time, likely not more than 10 years away.
    I am not too sure about alternatives, because if the crises comes to a surprise we won't have lots of oil to produce the alternative (like solar cells, nuclear power plant), which needs lots of energy to produce in high volume.
  21. powerbook4me macrumors member

    Apr 20, 2004
    Wow, what a great post.

    I can't believe I actually learned something here at 2:40ish am.... lol :D
  22. satty macrumors 6502

    Mar 1, 2004
    You can't beat Wellington on a good day

    A shortage of oil is not only about "I can't afford to drive my SUV anymore". Have you ever attemped to live without oil or oil products? Forget it, you never want to get there:

    Eating oil

    It's not only the economy that is largly based on oil, it's also the agriculture.

    Again, I don't want to scare anybody, but watch out about everything that mention "peak oil". You will be surprised how many indicators are already out there, even in mainstream press like BBC, CNN...
  23. TimDaddy macrumors 6502

    Mar 13, 2002
    Versailles, KY (and that's pronounced Vurr-sales)
    I was just thinking about that. I remember in 1988 (4th grade) being told the same thing. Then, in 1999, I read in the paper that we had 35 years worth of oil left! We gained five years worth over the course of eleven years? I'm glad an energy crisis is not immenent, but I still hope we can drastically cut our consumption to save the air and get the entire world out of the chokehold that OPEC has us in. There are also theories about what removing the oil while not replacing it with some other lubricant may be doing to the inside of the planet. Some think the increased friction may be contributing to global warming as well as us burning the oil. I have also heard that this may cause an increase in earthquakes. Granted, these are theories that I heard on Coast to Coast with Art Bell, but you never know!

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