File spoon-archives/marxism-international.archive/marxism-international_1997/marxism-international.9706, message 125


Date: Sun, 08 Jun 1997 21:01:29 -0700
From: Mark Jones <majones-AT-netcomuk.co.uk>
Subject: M-I: [Fwd: How much oil?]


Message-ID: <339B7FD3.176E-AT-netcomuk.co.uk>
Date: Sun, 08 Jun 1997 21:00:19 -0700
From: Mark Jones <majones-AT-netcomuk.co.uk>
X-Mailer: Mozilla 3.0C-NC320UK  (Win16; I)
To: jim-AT-cag1.demon.co.uk
CC: Roger <pluto-AT-plutobks.demon.co.uk>, SDrury8183-AT-aol.com,
	W Warren Wagar <wwagar-AT-binghamton.edu>
Subject: How much oil?

OIL AS A FINITE RESOURCE:
                   When Is Global Production Likely to Peak?

SUMMARY

Fossil fuels -- oil, natural gas, and coal -- account for the vast bulk
of 
global energy supply. These fuels, formed over millions of years, are
finite and non-renewable. In due course, they will become scarce and
costly, requiring the introduction of replacement energy sources. The
role of fossil fuels in powering modern economies is so vital as to
warrant a review of ultimately recoverable reserves and of plausible
future consumption
patterns. So doing will help decision-makers determine when replacement
sources and new technologies might be needed. As a starting point in
such a process, future supplies and consumption patterns of crude oil
are assessed here.

Over the past fifty years, many oil companies, geologists, governments,
and private corporations have performed scores of studies of Estimated
Ultimately Recoverable (EUR) global oil. (EUR oil is the total amount of
oil that will eventually be pumped from the earth.) Taken together, the
great majority of these studies reflect a consensus among oil experts
that EUR oil reserves lie within the range of 1,800 to 2,200 billion
barrels. As of the end of 1995, the world had consumed about 765 billion
barrels of these ultimately recoverable reserves.

Given these estimates of recoverable oil, and plausible assumptions of
moderate growth in demand (about 2 percent per year), we can use a
simple model to calculate when world oil production might begin to
decline, driven by resource constraints. At the low end, for EUR oil
equal to 1,800 billion barrels, peaking could occur as early as 2007; at
the high end (2,300 billion barrels), peaking could occur around 2014.
(An implausibly high 2,600 billion barrels for EUR oil would postpone
peaking only another five years -- to 2019.) If oil demand were held
constant at today's level -- through some
such measure as a carbon tax or a cap on carbon releases -- the time of
decline could be delayed by decades. 

As the peak of global oil production approaches, world oil prices will
rise from their present low levels, though by how much and how fast
remain uncertain. The economic impacts will depend largely on the price
and availability of energy alternatives. The transportation sector,
almost totally dependent on oil, could be especially hard hit unless
vehicles fueled by sources other than petroleum are developed and
rapidly deployed.
As the peak and decline of world oil production comes within sight,
policies to encourage more efficient oil use and a switch to alternative
energy sources, especially in transportation, become urgent.
Unfortunately, because oil prices are low, few decision-makers
appreciate how little time remains, and efforts on both of these
accounts are weak and overdue.

from

OIL AS A FINITE RESOURCE:  When Is Global Production Likely to Peak?
                                                                             
James J. MacKenzie
  March 1996


World Resources Institute, 1709 New York Avenue, NW, Washington, DC
20006
(202/638-6300; fax: 202/638-0036). For more information, contact Jim
MacKenzie 

http://www.wri.org/wri/energy/jm_oil/index.html




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