Right now we obviously have a stability problem in the Middle East that drives speculators to bet that oil prices will go higher. The speculators create a spike or bubble and that is why gas is now $4 a gallon. If we can get the Middle East to settle down (fat chance) and get our government to start developing our own huge oil reserves, oil could soon fall to $50 a barrel. That would mean that in most states gas would be under $2 a gallon.<\/p>\n
I know about the Hubbert peak oil theory. It is not entirely wrong but it is based on conventional oil and he had no way of knowing the advances that would come in the technology. For example, oil developers are now able to extract about one-third more oil out of a well than they could just a decade or so ago. They also are drilling in places offshore to depths that were unheard of.<\/p>\n
Let me talk some about the world oil supply and demand. There is still some spare oil production capacity in the world today and there is little reason for these high oil prices other than some production disruption in Libya and the oil speculators that are always willing to run up prices whenever they can cash in on any possibility of further turmoil.<\/p>\n
Current production of producers is 89 mb\/d and demand is about 89 mb\/d but OPEC nations alone could pump an additional 4 mb\/d anytime they wanted to lower oil prices. If you consider that the total cost of getting their oil to market is only about 5 dollars a barrel, they are making a killing by purposely holding back on full production. This cartel really is illegal. They are price fixing. They should get sued before the World Court and the WTO should deal with them.<\/p>\n
Keeping oil prices too high for too long does have dangers for OPEC . Saudi Arabia knows the danger and eventually increases production and I suppose they will again. But lessor producers in OPEC get deliberately short-sighted because their governments continual overspend. If oil prices stay too high for too long, nations will start developing alternatives and they will be importing less oil. Also, high oil prices could put the world back into a recession and that would mean oil demand and prices would dramatically fall. Oil went from $147 a barrel to $50 during the last world recession. Only the OPEC production cut-backs started the rise of oil prices again.<\/p>\n
Further, with the high unemployment in Europe and the United States and the conservation efforts that are ongoing, the more advanced nations are not going to be importing more oil anytime soon. Japan was in no growth territory before the earthquake, now they also will be using less oil. The main countries keeping demand strong are China and India but China has way overbuilt their manufacturing capacity and India lacks basic infrastructure to support much increased oil use. So although there could be a few more years of increasing demand from these two nations it is not going to last long enough to take up all the spare oil production capacity in the world that will be available.<\/p>\n
Also, keep in mind that production in Iraq, Canada and Brazil will be increasing rather dramatically in fairly short order. The U.S. could also increase conventional on-shore and off-shore production fairly quickly and significantly if government and lawsuit crazy environmentalists would ever get out-of-the-way. It’s not the cost of the lawsuits that is the main problem, it is the 5 year delays that the lawsuits cause before anyone can even drill a new well.<\/p>\n
Iraq alone will increase oil production over the next decade between 3 to 9 mb\/d (what Iraq may actually be able to achieve depends on who you ask). The Iraq government goal is 12 mb\/d. They now produce less than 3 mb\/d. The Iraqi reserves are probably greater than that of Saudi Arabia and they can get it out of the ground almost for nothing.<\/p>\n
World proven conventional oil reserves are about 1.4 trillion barrels of oil or enough for about 40 years even with some increase in demand. That figure does not include unproven reserves and undiscovered conventional oil. So, even as old fields fall off, new fields and modern methods that almost double the amount of oil extracted from a field should be able to keep conventional production high enough to meet world demand for at least another decade or two. Of course, if there is war in the Middle East or if OPEC holds back production for political reasons the equation will change temporary.<\/p>\n
At prices between $50 to $70 a barrel unconventional oil could be developed. In time, it could make the U.S. an oil exporter and the profit could be used to pay off our national debt.<\/strong><\/p>\n (the following figures are a judgment call of mine since various sources vary tremendously in their estimates.)<\/p>\n Oil shale reserves in just the Green River Formation in Utah, Colorado, and Wyoming have about 1.5 trillion barrels of oil – that is equal to six Saudi Arabia’s.<\/p>\n Known oil shale reserves in the rest of the US and the world could easily could add another 1.5 trillion barrels – or 6 Saudi Arabia’s<\/p>\n Oil sands reserves in Canada and Venezuela total 3.6 trillion barrels – or 14 Saudi Arabia’s<\/p>\n Other oil sand reserves around the world would add another 1 trillion barrels – or 4 Saudi Arabia’s<\/p>\n If you add that up there is about 7.6 trillion barrels of shale and sand oil and 1.4 trillion barrels of conventional oil.\u00a0 Therefore, the world has at least 9 trillion barrels of oil waiting for someone to come and get it. Some think there is way more oil on earth than that. We have hardly explored the oceans and some good minds think oil is abiotic and is not even a fossil fuel. They believe the earth may continually be producing more oil.\u00a0 let’s just be conservative and say the earth has 10 trillion barrels of recoverable oil and let’s say world demand will peak at about 100 mb\/d. I know most projections say world consumption will go to 120 mb\/d but I believe it won’t go much higher than 100 mb\/d for reasons that I will explain below.<\/p>\n That 9 trillion figure tells me that the world has enough oil for over 250 years. Thus far in the whole history of the world we have used 1 trillion barrels of oil and there are at least 9 trillion barrels left. What oil shortage? There only has to be the “will” and the “means” to get the known oil extracted. Part of the problem with the “will” to abstract more oil is caused by the anthropic global warming liars and the phobic brainwashed that follow them. If we burned all the oil in the world it would make the trace CO2 gas somewhat higher on earth but it still would still be a trace gas. Increased CO2 would increase more plant growth and world food production and because plants use CO2 to live on the CO2 in the atmosphere would come to a balance.<\/p>\n Even if it could be proved that the world would get warmer due to increasing CO2 (which they have not proved at all), warming would only enhance plant life on a planet with increasing food needs to support the rising population. The “means” to get this unconventional oil out of the ground is already pretty well-known. What is needed to accomplish the means is a new U.S. administration that will ignore the Gaia worshipers and allow the major oil companies to extract the shale oil<\/p>\n So, why won’t the world use as much oil as some are projecting? <\/strong>For several reasons: First, we are learning to use oil more efficiently, modern vehicles run more efficiently, oil demand in the United States is actually falling. Second, alternative energy sources will reduce the need for oil. Third, populations in the countries that use the most oil per person are generally decreasing and aging, for example, Europe, Russia, and Japan. Fewer people and more retired people means less use of gas. Fourth, growth will not continue much longer at the rate it has been in China and India. There simply will not be enough demand in the aging first world nations for never-ending increased production of consumer goods. Also, China with their one child policy will be aging sooner than you might think.\u00a0 Finally, the world population will level off around 2050 AD and then begin to decrease.<\/p>\n By the way, they will be able to get oil out of shale and oil sands for $50 to $70 barrel with the new environmentally friendly in-situ extraction methods. The bottom line is that God gave the world plenty of oil that we can get out of the ground for reasonable prices, but speculation and wars drives up the cost and restrictive governments and Gaia worshipers limit the production.<\/p>\n","protected":false},"excerpt":{"rendered":" Right now we obviously have a stability problem in the Middle East that drives speculators to bet that oil prices will go higher. The speculators create a spike or bubble and that is why gas is now $4 a gallon. 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