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TechnoratiStill Places Worth Drilling for Oil, but What Does US Do After That?
The debate over oil prices took a turn for the useless the moment our Dear Leader and his party's heir began blaming $4-a-gallon gas on people who oppose drilling in the neighborhood of Florida's beaches or in Alaska's wildlife refuge. According to those two, the people in Jakarta and Sydney and London are paying more for gas because the people in Burlington and San Francisco and Daytona Beach were opposed to sucking up a few drips of oil from the Atlantic and the Arctic.
It's never wise to trust an addict, but George Bush and John McCain are also pushers with a considerable clientele for cracked-up ideas, like consumers who think nothing about railing against social programs that help the poor but somehow feel their $40,000, 12-mpg SUV is entitled to cheap energy. Now they're telling us that opening up more seas and federal lands to drilling will bring down the price of oil. That's about as logical as suggesting that curing cancer will save Social Security -- if by curing cancer more people will live longer and contribute more taxes to the Social Security trust fund. Even if it wasn't mathematically outlandish, generating more tax dollars shouldn't figure in the top 1,000 reasons to cure cancer. Just the same, there may be some reasons to drill for oil. Lowering the price of oil isn't among them.
And there are a few places worth drilling: The world isn't about to switch away from its oil-based economy overnight. Canada's gigantic oil sands reserves come to mind, as does that other off-shore prize more than 4,000 American soldiers and a few hundred thousand others have died for, so far -- Iraq's 100 billion barrel oil reserve that Exxon Mobil, Shell, Total and BP are ready to tap again after being thrown out by Saddam Hussein in 1972. (This time, the consortium secured 58 permanent American military bases for its protection.) The war for oil aside, the price of that oil should reflect its decline as a resource and its polluting effects as a fuel. The higher prices should spur innovations. As far as fossil-energy costs are concerned, there's nothing more overdue than higher prices, especially if it blunts consumption.
Still, current prices won't stay this high. The market is most likely in an unsustainable price bubble. But drilling more to generate even an extra 1 million barrels a day 10 years down the line (because not a drop of oil will be produced until then) will make a difference in 2015 gas prices only in the minds of people who like their promises served up in crack pipes. Not that there's that much oil to be had here. America as an oil power is history. It can only remain so at the expense of others (hence, again, Iraq). But that's getting the drill too close to the mother lode of open secrets.
Peak oil is the theory that sometime this decade, more oil will have been extracted from world oil reserves than remains in the ground. Some think that point may have been reached. Canada's oil sands, which may hold upwards of 150 billion barrels (half of Saudi Arabia's reserves) suggests peak oil is still a few years away. But it's coming soon, because worldwide consumption keeps increasing fast (it was 68 million barrels a day in 2000. It's around 80 million barrels a day today. Americans account for a quarter of that). Debate peak-oil theory all you like. In the United States, oil production peaked in 1970, at 9.6 million barrels a day, and has been falling quickly since. Prudhoe Bay in Alaska, by the way, didn't begin production until 1977. That didn't stop decline. Production was barely above 5 million barrels a day in 2006, and almost 1 million barrels a day less than when Bush took office. Drilling in the Arctic refuge and offshore is oil companies' attempt to milk every inch of land and seafloor for extra dividends. It has nothing to do with alleviating consumer costs.
Three realities to keep in mind when guzzling oil addicts' distortions and wishful drilling. First the Atlantic and the Arctic contain a few billion barrels of oil at most. Second, projected increased production in Saudi Arabia, Canada and Iraq will overwhelm anything produced in the United States. Third, energy independence is a pipe dream -- especially when the country insists on increasing its dependence on oil, whatever its provenance, rather than innovating its way out of it.
This Third Oil Shock will pass. But it's neither the last nor the most painful. Absent a sustained shift away from consumption toward conservation and alternatives (like evidence of significantly lower gas and diesel consumption in April), greater shocks are ahead -- deservedly, considering what little we're doing to avoid them.
Tristam is a News-Journal editorial writer. Reach him at ptristam@att.net or through his personal Web site at www.pierretristam.com.
© 2008 News-Journal Corporation
15 Comments so far
Show AllYou don't need to worry too much about plastics and drugs. They only use about 2% of oil produced so after we stop using oil for transport, there will still be enough feedstock.
Drill
Conserve
Alternative Energies
We need it all
It's gonna be a bad decade before this sorts itself out.
"Still Places Worth Drilling for Oil, but What Does US Do After That?"
DRILL DRILL!! KILL KILL! DRILL KILL! KILL DRILL!
metamorph speaks for me. I know high gas prices are exceedingly difficult for some, but the sooner they go sky high, the better. Only then will people get conscious about their use of energy in all forms and begin to serious about the issue. More drilling or tax holidays will only lull us into complacency and postpone the inevitable ... or worse.
"The carbon is best left sequestered in these deposits, not processed and burned."
For later use?
Canada's TAR sands are an extremely short-sighted source of fuel products. Environmental damage is astronomical, and extremely inefficient to boot. As dumb as the Colorado shale-oil proposal.
The carbon is best left sequestered in these deposits, not processed and burned.
"Withdraw the troops and watch the prices drop."
Nope. Oil has doubled in price in the last year. What is different in the areas where the troops are over the same period? Nothing much.
"Firstly, how does he know that Iraq's "proven" 100 billion barrels is correct?"
No one really knows this stuff, true.
Pierre is blind too. Firstly, how does he know that Iraq's "proven" 100 billion barrels is correct? That number has been obtained by voodoo and what actually counts is which fraction of Iraq's oil can be recovered. The "four favored sisters" which have obtained contracts do not have enough funds themselves to explore and produce hence must borrow. Exaggerating "proven reserves" is an old game to impress and lure potential lenders. Iraq's vaunted "super fields" are old and may actually be tottering. The only fields that produced an estimated 500,000 barrels per day in the year 2000 were Rumaila South (discovered in 1953;500,000),Runaila North (discovered in 1958; 700,000), and Kirkuk (discovered in 1927!;900,000) but these production rates are already below those of 1971 and are not accurately known. Mosul's production, the great-grandfather of Iraqi oil, is not well known at this time. It is also not known whether current production rates are sustained by injection of water and whether these are already dangerously large.
Like almost everybody else Pierre ignores the continued demand for hydrocarbons by the chemical and pharmaceutical industries. Some people think that it may all come from bio-oils. Sorry that I say this but they are demented. Known untapped oil fields must be set aside for crunch time to keep "plastics" and "drugs" coming. Perhaps that means that drilling off-shore US must begin soon and the wells be capped until the oil and gas is needed but not for cars.
Galen said "NOW what do you do?"
Go find another planet to exploit. Like say Mars. All its lakes and oceans are made of pure crude oil - of the light-sweet variety.
So you drill in all the technologically challenging areas, pulling the last few drops of feasibly recoverable oil out of the ground. Then refine it.
Six months later it's all gone.
*poof*
And with it the world economy.
NOW what do you do?
those high gas prices are a blessing because they are a wake-up call. Dr Hansen has not been able to reach the public but those gas prices are doing it. Gas in Europe is much higher - $10 in London I am told- no wonder those people are lining the roadways with solar panels and innovation is happening there more than here.
I don't think bringing the troops home will cause a large enough rise in light-sweet oil exports, which all evidence suggests is the prime reason for the current high price. Removing the sanctions/stopping the economic war against Iran would have a positive effect. But it is unlikely that either Iran or Iraq can increase their exports of light-sweet fast enough to mitigate the decline in exports by others, and why would they want to? And if they did raise exports, who would they send them to? To Western countries that have made war against them, or to Asia--China--a region and country that hasn't.
Through its support of Israel and the attacks against Iran and Iraq, the West made a collosal mistake regarding its energy security, and thus economic security. And since they are of the West, EU and US politicians continue to dig the hole they're in deeper and deeper. Obama will slow down his digging to talk, while McSame will dig faster, along with Sarkozy, Brown, and Merkel.
Oil price has shown a steady 6% rise per month over the last year because of falling net exports. Those exports will continue to fall and importers will continue to bid up the price at the 6% rate we've seen, which gives us $170 oil by November unless something occurs to alter the current imbalance between demand and net exports. Feel free to come to The Oil Drum to see and discuss the data and become informed about the pickle we find ourselves in.
Reactionary politics brought to you by BushCo. Solutions to oil addiction brought to you by no one. It's akin to asking a heroin addict to be your leader in a drug crisis.
Withdraw the troops and watch the prices drop.
Bush promotes the Drill, Drill, Drill mantra, while at the same time behind the curtain he raises tariffs on the Chinese steel needed to drill, drill, drill.