You may have heard about the recent report from Cambridge Energy Research Associates regarding the decline in oil fields. The richest media report is this one I just received from Australia:
DOOM-LADEN forecasts that world oil supplies are poised to fall off the edge of a cliff are wide of the mark, say leading oil industry experts who warn that human factors, not geology, will drive the oil market.
A landmark study of more than 800 oilfields by Cambridge Energy Research Associates (CERA) has concluded that rates of decline are only 4.5 per cent a year, almost half the rate previously believed.
CERA therefore concludes that oil output will continue to rise over the next decade.
…
Only in CERA-land could an annual decline in oil production produce a rise in output! The truly bad news is that they say they have surveyed 80,000 oil fields covering 2/3 of world production. This is not good. Their number for world production is 91 million barrels/day, so a 4.5% decline of 2/3 of the 91 results in a worldwide drop of:
- 2.7 million b/day in one year – more than all the current production of Alberta’s oil sands
- 7.8 million b/day in three years – more than Kuwait, Iraq, and the United Arab Emirates put together
- 12.5 million b/day in five years – more than Saudi Arabia, the world’s largest producer
- 25.7 million b/day in twelve years – more than all the oil consumed by the United States (by far the world’s largest consumer, at 25% of the total) in 2006; or more than all the oil produced by all Mideast countries last year (Saudi Arabia+ Iran+ Iraq+ Kuwait+ UAE+ Qatar+ Oman+ Yemen+ Syria)
