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, Fri, 2 Mar 2012 12:55:06
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In a perverse way, high oil prices are a good thing--at least as far as supply is concerned. High prices make it profitable to pump from expensive sources, such as the Canadian tar sands which is now a significant source.
The argument that some politicians make that opening certain areas in the US, such as Alaska, won't change anything is both correct and bogus. There are about 880,000 oil wells in the world, and about 550,000 in the US. No one area will change anything; only huge increases in the well count and further developments in technology will make an impact.
Think about that well count. If the US has 3/5 of the wells, it suggests there are a lot more places left to drill. It's not likely that the US had such a huge proportion of the world's oil. There's likely a lot more out there. Because the wells in the US are mostly old, they are no longer producing a lot, but they are still producing.
About "Peak Oil": In 1913 the Interior Department said the world oil supply would last 13 years. In 1951 they said the world had proven reserves to last 13 more years. In 1970 proven reserves were estimated at 612 billion barrels; by 2006 more than 767 barrels had been pumped and reserves were estimated at 1.2 trillion barrels. No new Saudi Arabias had been found, but a few new fields had been developed and technology has allowed extraction of a lot more oil from every well. Not so long ago it was only possible to pump 1% of the oil estimated to exist in a given field; now they pump about 10%.
Reserves are estimated as recoverable oil at a current price. If the price of oil dropped to $10 a barrel, you would see a huge drop in reserve estimates. If it went to $200, you would see an increase.
There's plenty of oil out there--at a price.
posted by 72.19.5...
, Fri, 2 Mar 2012 12:55:06
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