Ray, the oil companies are eating up their oil reserves much faster than they are discovering new oil. Oil demand is projected "to climb by 50% by between now and 2025; from, that is, approximately 80 million to 120 million barrels per day." That's per day. At some point world oil production will peak. The oil companies are buying back stock and making acquisitions instead of using that money to explore for new oil. US oil production peaked in 1972 and has been trending downward. US and countries oil consumption is rising each year.
We will need a larger share of foreign oil production each year even with Alaskan Wildlife Refuge oil.
"That the major oil firms see few promising new fields to invest in right now is further suggested by reports that these companies are sinking their colossal profits in mega-mergers and stock buy-back programs rather than in exploration and field development. ExxonMobil, for example, spent $9.95 billion to buy back its own stock in 2004, while ChevronTexaco put out $2.5 billion to do the same. Meanwhile several big companies, including ChevronTexaco, are said to be eyeing California-based Unocal Corp. as a possible acquisition, and ConocoPhillips recently announced a $2 billion investment in Lukoil, the Russian energy giant. These moves are consuming funds that might have gone into new-field exploration -- yet another indicator of diminished expectations for major new discoveries. "If they had attractive things to invest in, they'd be investing their little heads off," explained PFC Energy managing director Gerald Kepes. But the great exploration opportunities of yesteryear "have largely dried up. ... The worldwide decline in new discoveries has profound implications for the global supply of energy and, by extension, the world economy. Given a recent surge in energy demand from China and other rapidly-developing countries, the U.S. Department of Energy (DoE) predicts that, for all future energy needs to be satisfied, total world oil output will have to climb by 50% between now and 2025; from, that is, approximately 80 million to 120 million barrels per day. A staggering increase in global production, that extra 40 million barrels per day would be the equivalent of total world daily consumption in 1969. Absent major new discoveries, however, the global oil industry will likely prove incapable of providing all of this additional energy. Without massive new oil discoveries, prices will rise, supplies will dwindle, and the world economy will plunge into recession -- or worse.
... Whether peak oil arrives in 2005, 2010, or 2015, and whether the maximum level of daily oil output turns out to be 90 or 100 million barrels will not matter much in the long run. In any of these scenarios, global oil production will level off and begin to decline at a level far below the anticipated world demand of 120 million barrels per day in 2025." "
commondreams.org
Lawrence |
