extensive new scientific
in Wiley Interdisciplinary Reviews: Energy & Environment says
that proved conventional oil reserves as detailed in industry sources
are likely “overstated” by half.
to standard sources like the Oil & Gas Journal, BP’s Annual
Statistical Review of World Energy, and the US Energy Information
Administration, the world contains 1.7 trillion barrels of proved
according to the new study by Professor Michael Jefferson of the ESCP
Europe Business School, a former chief economist at oil major Royal
Dutch/Shell Group, this official figure which has helped justify
massive investments in new exploration and development, is almost
double the real size of world reserves.
Interdisciplinary Reviews (WIRES) is a series of high-quality
peer-reviewed publications which runs authoritative reviews of the
literature across relevant academic disciplines.
to Professor Michael Jefferson, who spent nearly 20 years at Shell in
various senior roles from head of planning in Europe to director of
oil supply and trading, “the five major Middle East oil exporters
altered the basis of their definition of ‘proved’ conventional
oil reserves from a 90 percent probability down to a 50 percent
probability from 1984. The result has been an apparent (but not real)
increase in their ‘proved’ conventional oil reserves of some 435
reserves have been further inflated, he wrote in his study, by adding
reserve figures from Venezuelan heavy oil and Canadian tar sands –
despite the fact that they are “more difficult and costly to
extract” and generally of “poorer quality” than conventional
oil. This has brought up global reserve estimates by a further 440
conclusion is stark: “Put bluntly, the standard claim that the
world has proved conventional oil reserves of nearly 1.7 trillion
barrels is overstated by about 875 billion barrels. Thus, despite the
fall in crude oil prices from a new peak in June, 2014, after that of
July, 2008, the ‘peak oil’ issue remains with us.”
thought the above article worth a post of its own. After all it is a
vindication of what many of us have been saying for years now. And I
especially call your attention to the line: “the standard claim
that the world has proved conventional oil reserves of nearly 1.7
trillion barrels is overstated by about 875 billion barrels.”
puts conventional reserves at about 825 billion barrels. That is OPEC
+ Non-OPEC, that is everything, well, everything conventional. That
is almost exactly the amount of reserves I have been claiming for
years. I have been thrashing this straw for over a decade and it
feels good to get some vindication.
March 29th, the Government Accountability Office (GAO), also referred
to as the ‘congressional watchdog’, released a much-anticipated
report called Crude Oil: Uncertainty about future oil supply makes it
important to develop a strategy for addressing a peak and decline in
report was initiated by a request, just over a year ago, from
Congressman Roscoe Bartlet, a very vocal proponent of the peak oil
theory in the U.S. Congress.
significance of this report cannot be under-stated. For the first
time in North America, an independent and nonpartisan agency that
works for Congress and the American people has gone on record stating
that peak oil is a real and pressing concern that the government
should be preparing for.
new economic phenomena will kick in the moment oil production peaks,
turning normal national finance ministry policies on their heads
reason there is such heated debate over when exactly peak oil is due
to arrive is because, at the point of the peak, the fundamental laws
of economics governing oil production, consumption, and prices, will
flip over to a whole new paradigm. And because oil is very much the
key commodity at the root of all economic activity in the modern
industrial world, the flip-over of economic laws governing oil will
deeply affect, and even potentially flip over, the fundamental
economic laws governing all of the world’s industrial activity.
I thought I would just add a couple of charts taken from the EIA’s
latest Short-Term Energy Outlook.
EIA expects shale oil and the rest of the lower 48 states to continue
to decline but slow the decline next year and plateau in the last
quarter of 2017 at 5.7 million barrels per day.
saving grace, the EIA believes, will come from the Gulf of Mexico.
They have GOM production reaching 1.93 million barrels per day in
December of 2017. The spikes downward in August, September and
October of 2017 and 2017 are obviously the EIA trying to anticipate
the hurricane season. I think they are being overly cautious here. It
is unlikely that disruptions of this magnitude will occur.
after you combine the two above charts then add in Alaska you get the
above production numbers and projection.
Laherrere posted me all the below: It is good to see that he is also
in agreement with the above article.
in this 2016 paper writes:
bluntly, the standard claim that the world has proved conventional
oil reserves of nearly 1.7 trillion barrels is overstated by about
875 billion barrels.”
my graph of political current proved and 2P backdated remaining
reserves in 1998 Scientific American (with 1700 missing fields) I
have updated often in many papers this very important graph (the most
important in my opinion) because it explains the huge discrepancy
between the economists relying on official data and the technicians
relying on confidential data.
can see in my graph the conventional oil remaining reserves is, at
end 2015, about 1700 Gb for IEA and OGJ (EIA) but at about 800 Gb for
the backdated confidential technical sources, in line with Michael
am glad to see IIASA (which designed the very optimistic energy
scenarios for the IPCC reports, in particular with the crazy CRP 8.5)
showing more realistic assessments.