Supply

Where will we obtain the oil that we need?

Supply Experts are divided into two schools: the optimists and the pessimists.

Optimists

Supply/Optimists Optimists believe that we have many decades worth of plentiful oil (and natural gas) waiting to be found. Therefore, there will be plenty of time to locate the oil, natural gas and coal that we need. And there will be plenty of time to develop alternate energy sources.

Supply/Optimists They have several reasons for optimism: 1)Continuous improvements in all areas of technology, from mapping underground rock structures; through drilling; through transportation systems; through refining.

Supply/Optimists 2.In particular, improvements in discovery and drilling have meant that new fields have been found (Alaska, North Sea) and old discoveries can be tapped for the first time.

Supply/Optimists 3.There is every reason to believe that technology will only improve in these areas.

Supply/Optimists 4.Many parts of the planet remain to be explored, and 5.There are still numerous promising areas that have yet to be thoroughly searched (offshore of West Africa, deep in the Caspian Sea).

Supply/Optimists Bottom line: there is plenty of oil left, and we will have enough time to develop alternative fuels without difficulty.

Pessimists

Supply/Pessimists Pessimists believe that we have only a few decades worth of plentiful oil waiting to be found. Therefore, there will be NOT be plenty of time to locate the oil, natural gas and coal that we need. And there will be less time to develop alternate energy sources.

Supply/Pessimists 1.While it is true that many parts of the planet remain to be thoroughly explored, part of that is because preliminary searches determined that some of these areas had no oil, or extremely little.

Supply/Pessimists 2.The promising areas may turn out to be duds: the oil industry is littered with promising areas that turned out to be disappointments.

Supply/Pessimists 3.In any case, most of the promising areas will be where the costs of drilling them will be substantially higher than current oil production costs (offshore).

Supply/Pessimists 4.Much of what we have left is in potentially politically unstable regions, such as the Middle East.

Supply/Pessimists 5.Every year that passes without a major discovery increases the likelihood that there is a lot less oil to be found than the optimists believe, because it isn’t there.

Supply/Pessimists Bottom line: there is a lot less oil left than the optimists believe, and we need to start rapidly developing alternate fuels today.

Supply So who is right? We really don’t know how much oil is left: what we have are known reserves, which are reserves already found and available with current technology.

Supply The pessimists are right to point out that a large percent of known reserves are controlled by OPEC. The optimists are right that technology has found new fields, will discover more, and will make more available from existing fields.

Supply Pessimists have been wrong many times before. Pessimists are right in pointing out that every year without the discovery of a giant oilfield means finding one is less and less likely. Without that giant, we will find difficulties starting sometime between 2010 and 2020.

Supply We don’t know what is left, and common sense would tell us to start acting now to conserve, and to develop alternatives. Among oil experts, there is a continuous, slow movement of optimists into the pessimists’ camp….