For the past few days I have been writing about how much fossil fuel there is left in the world. Today I deal with the last major source of fossil fuel –oil.
Most people think of oil when they think of energy. Oil reserves are very hard to assess. Some countries over state their oil reserves or mis-count them for political reasons. This probably also happens with coal and natural gas, but oil has a long history of over stating its reserves. It was not so long ago that Shell over stated its oil reserves, causing the stock market to be deceived about the true worth of Shell’s assets.
Since 1986 proved reserves in the world (that is to say those known amounts of oil which are at today’s prices with today’s’ technology economically extractable) have hovered around the 40 years worth. This is a useful way of measuring oil, because as prices rise so the oil in some places becomes economic to extract. As of now the oil industry estimates that we have 42 years worth of oil left.
In fact the physical reserves of oil fell by 3 billion barrels in 2008 to 1.28 trillion barrels, the first time that the physical reserves have fallen. Russia, Norway and China reported less oil; Vietnam India and Egypt reported more oil. Perhaps more worryingly because it may be less accurate there were large upwards revisions of oil reserves in Venezuela and Angola.
In 1985 around 47 million barrels of oil was produced each day. According to BP’s figures in 2008 about 82 million barrels of oil was produced each day. Oil production is dominated by the Middle East region.
Oil prices are an important factor in determining how much oil we have left, in terms of years. The cheaper the oil price, the more quickly it will be consumed and cheaper oil prices do not provide any incentive for fuel efficiency based on oil use, particularly in the fuel transportation sector. In real terms (counting in US dollars and adjusting for inflation) oil cost around two dollars a barrel from 1880 until 1972. In 1979 its price jumped to around 437, and then fell back gradually until it reached $15 in 1994. It brief climbed back to $20, and fell back to 1$12 in 1998 and since then the price movement has been upwards. In 2008 the average price for oil was around $98 a barrel. It has fallen since to less than $40 and recovered and at the time of writing is now around $72 a barrel.
The USA is by far the world’s largest user of oil. It consumed 22.5% of the world’s oil production in 2008, which was less (as a share) than it consumed in 2007. Other large oil consumers include Germany (3%) Canada (2.6%) Brazil (2.7%) UK (2%) France (2.3%) Russia (3.3%) Iran (2.1%) China (9.6%) Japan (5.6%) India (3.4%) South Korea (2.6%). Although the European Union is more populous than the United States it consumed 17.9% of the world’s oil, compared with 22.5% in the USA.
Oil is used in power stations and in fuel transport for vehicles, trains, vessels and aviation. Savings in efficiency are being made in vehicle fuels. Some vehicle manufacturers are claiming almost double the mileage from a given quantity of petrol than they were claiming for the same or similar vehicle a few years ago. However, the savings in mileage are more than outweighed by the increasing numbers of people who are acquiring motor vehicles for the first time, particularly in India and China. This will add upward pressure on oil prices as well as reduce the reserves more quickly.
Aviation is the world’s fastest growing oil drinker. More and more air routes are coming into existence and the cost of flying in real terms has become so low that Governments across the world are for the first time able to tax aviation as a nice little earner.
Despite the protestations of the airlines the environmental case against them is very strong. In the UK aviation now contributes 5.5% of the greenhouse gas emissions and in emission terms is completely uncontrolled and untaxed. The airlines are so worried that they have formed a “sustainable aviation group”, which is a finely ironic unintentional oxymoron.
But I digress; the question as to how long oil will last is quite hard to answer. The higher the price the more economic it is to develop previously uneconomic oil fields. The scarcer the oil the more likely it is that Governments with previously reasonable environmental records will lose their environmental principles in the chase for the monetary wealth that oil brings. Canada has done just this in permitting the exploitation of the oil tars, which is not only devastating local environments and people in its far north but it is permitting the extraction of the tar oil in an extremely intensive greenhouse gas creating way.
I have obtained the figures for my articles from BP’s annual statistical review. BP’s Chief Executive prefaces the review with “Our data confirms that the world has enough proved reserves of oil, natural gas and coal to meet the world’s needs for decades to come”. He right; probably not more than four decades, though forty years at the most.
Filed under: carbon dioxide, carbon emissions, climate change, energy, fuel, global warming, oil | Tagged: aviation oil, BP, Canada BP oil tars, canadian extraction of oil tars, history of oil prices, number of oil years left at present consumption, oil reserves, oil reserves compared with consumption, physical reserves of oil
I have had a little time out from procedings and have been talking to a few other people on other forums and I am starting to think that the global warming thing is a little could be a little bit of a false flag, why ? well,
There are so many different heads of gummage going on, its hard to know which way to turn, to see the crows, and if you fly with them you wil be shot with them,
We have been told that the sun has been laying in its dormant phase of late and is about to start unleashing some serious heat again, this is when I think we are going to notice any real changes due to our wasteful ways and pollution, carbon etc is rather a conveniant way to raise taxes isn’t it,
On the oil depletion scenario, I have severaldifferent ideas upon this.
1. The oil companies have not built any new refineries for over 30 years now, was this because they wanted to momopolise on fuel prices and to stave off the emmeging industrial nations from getting at too much of it, or the supply has outstripped the demand
2. Same scenario but exploration has dropped by some 80% in recent years, maybe because they know there are no large fields left that are worth spending huge amounts ofmoney on,
3. They do know how much oil is left and its just starting to peak and therfore they don’t want to loose overall dominance of world power when it does eventually run out,
There are so many different angles of attack to which we have no real answers or control over, and its dammed anoying indeed for the powers at large to play with human lives, which is what its going to come down to, if they simply leave it until the last moments, or until we can blatently see/ notice for real what is a foot.
I second everything what has been said about using up one enrgy sourse to make another, this will cause the eventual end game for the black stuff, coal and everything else.
It has been said a thousand time, the world population will grow and food is what will be our undooing.
As we are today we are in control of our immediate enviornment, once oil becomes scarse we will no longer have a buffer to get the food to the shops, if the oil runs out faster than expected because the greedy companies want to make as much profit before they declare the correct amount in rserve, many millions of people are going to starve.
I think its long overdue about the actual figures and we should make the oil companies divulge exactly or to a higher degree of how much oil they have left.
Leave things as they are and we are at their mercy and its profit which they are intrested in not life, to them this is more expendable than the money.
In this computer age it is known that the oil comanies have 3-D software capabilities to map the wells, why not asl them to tell everyone how much they have.
I believe that we have already past the point of not return and its probably too late to undo any damage caused by the oil companies dishonesty.
I suppose time will ell, best get ready for the coming hardship,learn some of the old skills before all the old boys who are left that have this knowledge are gone.
This is what we are doing, so should you, take care now.
There is a lot of nonsense and paranoia surrounding oil depleation and alternative energy. The goverment knows this, they just want you money. Taxing energy use is a huge money spinner. Try this, get a strong container and fill it with your organic household waste, vegitation meat scraps and so on. Apply pressure, the more the better and leave for 6 months. After this time open your container, what do you think that smelly black liquid is? Crude oil.
In response to Dale, “The End Of The World Is Nigh”
Alternative energies require fossil fuels to create them? What about Deutrium and nuclear fusion, Deutrium is present in the water you drink, and sea-water, and doesn’t have the dangers of Uranium used in nuclear fission, this seems very feasible to provide electricity.
The materials for batteries to power “cars? well they have already been extracted so these materials, need to be used for transport purposes.
How many people in the U.S. even care about this? Do parents actually expect their kids will have cars when they grow up… do we teach our children today that everything is going to be better for them than it was for us?? We are among those who have the most to lose from the oil crash. We should get our heads out of the sand and prepare for the real economic downfall. 10% unemployment?! Try 90% unemployment! This is no joke. Our whole economy is based on oil… what do you think is going to happen when we can’t drive, can’t operate factories, can’t fly, can’t have overseas shipping. Alternative energies REQUIRE fossil fuels to create. Come on the only ones who will have hi-tech will be the ultra rich or the government because there won’t be enough to go around for the general population… where are you going to find enough material to create batteries for millions of electric cars? I suppose you are also going to power construction equipment, tankers, and rigs with batteries?!?!
Put down your iPods and Blackberries for a second. It’s time to be realistic… the oil age is over people. Enjoy the end of it while you can just prepare in the meantime.
I think you need to do a LOT more research on oil than simply reading the “…BP’s annual statistical review…” Not to do so would be to rehash the same rosy view from one perspective -spend some time at http://www.theoildrum.com or ASPO and get some other views by following the many links.
Anyway, the real issu is not the amount we have left in the ground but the extraction/flow rate for a given price and additionally the amount of that we extract that has to go into ‘keeping the extraction machine’ going (EROI).
The coming two decades will see a precipitous decline in energy available for non-discretional activities and this will change our current consumer biased Western civilisation more than we can possibly imagine in 2009.
Regards, Nick.
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Robert, I think the oil is being extracted and consumed much faster than it is being made underground, I understand that the catalyst for the creation of the crude oil from diatom’s is the heat from naturally occuring subterranean radioactive heat.
The point about the oil reserves is that it is an estimate of how much can be extracted profitably with current technology at current crude oil prices. There is a lot of oil underground that is unecconomical to extract or isn’t technically feasible.
This is an interesting article “How Oil Gets Stuck Underground In Inaccessible Places” :
http://www.sciencedaily.com/releases/2009/05/090511101654.htm
An interesting point is that the oil industry causes more radioctive poluttion in the North Sea than the nuclear :
http://www.ecolo.org/documents/documents_in_english/north_sea_radioact.htm
Given this kind of information we can realise that oil pollutes in other ways than CO2.
Thanks Peter
Nick
I should have made it clearer; I have rwad extensively on oil reserves and written about them in “the Energy Age”. I wanted to analyse the oil company’s take on it, and see how that compares t the policies that we are adopting in relation to energy.
I think that the last two paragraphs of your comment make the point very clearly, and I fully agree.
Robert
I think that Dale has some good points. Certainly renwable energy systems at the moment need fossil fuel to be manufactured. I think that the largest demand on energy will come from increased population figures and nations improving their way of life. the growth will continue until it becomes too malignant.
As far as Peter’s points are concerned there are a number of possibilities, like cold fusion, but I fear that most of them will remain just possibilities.
Robert
Someone described population growth as the elephant in the room that no one mentions!