Insight and inspiration in turbulent times.
So it’s almost official: World oil production is in trouble. The secret has been slipping out of late, with reports of Royal Dutch Shell and other oil producers downgrading their reserves, but it now seems that Saudi Arabia may also be in crisis mode over its reserves.
CARACAS – The high oil prices seen since the US-led invasion of Iraq could be followed by a drop, as has occurred for decades after every rise in prices. But even then, signs pointing to shortages in the medium to long term indicate that the era of cheap oil is officially over.
Such relatively modest amount leads us to believe that a new Russian law consummated in February 2004 was no coincidence. According to the new law, any information concerning oil reserves in the country is in fact State secret. Actual oil and gas reserves in Russia turned out to be not quite as big as the Russian elite had envisioned them. Taking into account today’s export tempo of oil products, Russia could soon begin importing oil.
Higher prices show that our insatiable demand for gasoline is catching up with our willingness to produce it.
“Energy is at the core of virtually every problem facing humanity. We cannot afford to get this wrong. We should be skeptical of optimism that the existing energy industry will be able to work this out on its own.”
I avoid the New York Times but lately, it’s become a compulsion, though only for the new daily column titled, “Names of the Dead.” Today’s listing: “DERVISHI, Ervin, 21, Pfc, Army. Fort Worth.”
Historic J.P. Morgan Investor Conference Marks Official Recognition of Peak Oil Issues By Financial Planners.
Producers currently discover about one barrel of “new oil” for every four barrels that are consumed worldwide, and there have been no large oil or gas discoveries in recent years. Anywhere. It gets worse. The world’s largest oilfields have been producing for many decades and now require heroic measures (such as pumping in seawater or steam) to coax the oil from the ground.
Geologists and analysts have been saying for some time that estimates of global oil reserves may be dangerously exaggerated. The oil industry has been gripped by scandal since Royal Dutch/Shell twice this year downgraded its proven oil reserves by 20 per cent, or nearly 4bn barrels. Shell may not be alone. Other companies and even governments have hyped up the estimates of how much oil they have, which is a vital factor in measuring their economic health…. About four-fifths of the world’s known oil reserves lie in politically unstable or contested regions.
A report from a conference of the Danish Board of Techology on the impact of peak oil (PDF format).
Crises multiply and grow, and still the petroleum bags are just dispensed as though they were falling autumn leaves doing no harm. We are now in the fall before the big autumn storm. Not many will make it through the coming “winter” of our own making.
Shell has, for the third time this year, cut its estimate of it proven oil reserves, adding that it was slicing more than $400 million from profits to account for the “disturbing deficiencies” in its reporting practices.
