How Much Oil Is Left?

World oil demand is surging as supplies approach their limits.

“Peak oil is the point in time when the maximum rate of global petroleum extraction is reached, after which the rate of production enters terminal decline.”

Forecasts of peak oil are highly controversial – not because anyone thinks oil will last forever, but because no one really knows how much oil remains underground and thus how close we are to reaching the halfway point.

So-called oil pessimists contend that a peak is imminent or has actually arrived, hidden behind day-to-day fluctuations in production.

Optimists, by contrast, insist the turning point is decades away, because the world has so much oil yet to be tapped or even discovered, as well as huge reserves of “unconventional” oil, such as the massive tar-sand deposits in western Canada.

When the International Energy Agency released a forecast showing global oil demand rising more than a third by 2030, to 116 million barrels a day, several oil-company executives voiced doubts that production could ever keep pace.

French oil giant Total, flatly declared that the “optimistic case” for maximum daily output was 100 million barrels—meaning global demand could outstrip supply before 2020.

Royal Dutch Shell estimates that after 2015 supplies of “easy-to-access” oil and gas will no longer keep up with demand.

Discovery rates – Oil can’t be pumped from the ground until it has been found, and yet the volume discovered each year has steadily fallen since the early 1960s.

Political and Economic factors above ground, rather than geologic ones below, are the main obstacles to raising output.

War-torn Iraq is said to have huge underground oil reserves, yet because of poor security, it produces about a fifth as much as Saudi Arabia does.

And in countries such as Venezuela and Russia, foreign oil companies face restrictive laws that hamper their ability to develop new wells and other infrastructure.

“The issue over the medium term is not whether there is oil to be produced, but rather how to overcome political obstacles to production.”

Article here.

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