in recent years several other countries have created their own SPR, see global strategic petroleum reservesGood call though, gsteff..
but it is not impossible that the oil industry is systematically understating their reserves
Note that OPEC production quotas are in part dependent on proved reserves - giving these countries an incentive to exaggerate. The huge jumps in reserves were not associated with the discovery of any particular large new fields. These time series are extremely implausible on their face and suggest mendacity. The truth may be starting to come out. Recently, Petroleum Intelligence Weekly got hold of internal Kuwaiti documents indicating their true reserves were less than half the claimed value. [link in original] This is a key point. 2/3 of the world's claimed remaining reserves are in OPEC countries, and all scenarios that assume peak oil is more than ten years away assume that OPEC can substantially increase production from present levels.
As I'm sure you are aware, Kuwait recently restated their reserves down. It isn't clear if they were fudging their numbers up, and are now giving a more reasonable number, if the new number is fudged below their "real" internal estimate, or if the best reserve estimation methods just have a really high variance.
In the late 1980s there were huge and abrupt increases in the announced proven reserves for several Opec countries. Between 1982 and 1988 proven reserves jumped suddenly from 467.39bn barrels to 760.50bn barrels. These sudden reserves additions coincided with Opec's decision -- informally in 1982 and then formally in 1983 -- to adopt a production quota system in defence of the oil price, which was coming under heavy pressure. Members suddenly added huge amounts of reserves in order to secure for themselves a bigger production share.[...]
Earlier, each Opec nation was assigned a share of production based on its own annual production capacity. However, the organisation changed the rule in the early 1980s to also consider the oil reserves of every member country. As a result, most Opec member countries promptly increased their reserve estimates. [...] All in all, Opec added 293.11bn barrels of reserves during the period 1982-1988.
Several explanations have been suggested for the sudden jump in Opec reserves between 1982 and 1988, none too satisfactory. One explanation is that these reserve additions were clearly not the result of new discoveries made during the years in question and are regarded by many as 'political reserves', i.e. reserves that were 'proven' either to support each country's demands for higher output allocation within the Opec quota system, or as a result of excessive upward revisions of earlier estimates.
Another explanation may be that the assessment of Opec reserves was originally based on a recovery rate of 20% of oil-in-place and was later re-evaluated at a recovery rate of 50% -- far above the current global rate of 29% and, therefore, unjustifiable. However, the abrupt increase in announced Opec reserves in the late 1980s was probably a mixture of upward revision of old underestimates and some wishful thinking.
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1. The military needs to be pessimistic about oil supplies because it is safer for them to assume there is less of a commodity they depend on than more of it.
2. The oil companies benefit from consumers worrying about peak oil because it justifies higher prices for retail oil products.
It is a good idea to look for alternatives, but it is not impossible that the oil industry is systematically understating their reserves, that estimate methods are inaccurate (both up and down) or that new extraction technology will allow us to gain access to oil that was previously too expensive to extract.
Finally, given a choice between domestic oil and foreign oil, you always want to consume someone else's oil before you consume your own - that way you end up as the last one with oil (whoever "you" happen to be).
Finally, biodiesel is a very interesting alternative to oil.
posted by b1tr0t at 10:12 PM on March 25, 2006