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Controversial answers to some frequently asked questions about the petroleum industry.


Is the world about to run out of crude oil?

Are we close to the point where demand for oil will exceed the world's production capacity?

Tips for the Brilliant, Witty

Simple Questions, Simple Answers

Editor's note: So you're at a dinner party or some other social function, and word gets out that you're part of the oil industry.

Of course, everyone wants to tell you what they think about the industry and your chosen career. You listen politely.

But then, the questions start coming -- and you, because of your position in the industry, are expected to know every answer to every question anyone has ever had about oil, the price of oil and why gas station employees don't automatically check your car's oil level anymore.

You confidently begin to answer, but, oh, oh -- repeating what your college professors told you doesn't help; you're being brilliant, of course, but the questioner's eyes begin to glaze over, and after you thoughtfully and logically drone on for five minutes or so they usually respond with, "Hey ... I thought ‘Spiderman' was a great movie. Didn't you?"

Maybe we can help.

Starting here, the EXPLORER each month will offer some brief, easy-to-understand information to help you handle the usual questions that we all get from the general public, which ordinarily isn't as brilliant as you are about such things.

And for some, the answers may help you, too.

Bonus points: Confine your answer to the "short answer" that's listed below, and people at most social functions will believe you're not only brilliant, but brilliantly witty.

So here we go: Controversial answers to some frequently asked questions about the petroleum industry.

Is the world about to run out of crude oil?

Short answer: No, but don't relax.

Divide known world reserves by current annual production.

Add room for consumption growth.

Create public panic.

We'll run out of oil in less than 30 years!

It may be time for explorationists to issue a statement of humility.

"Despite our vast expertise, we probably haven't discovered all of the oil in the world just yet."

That's the word from Joseph P. Riva, who wrote a report on the world's oil outlook for the U.S. Congress in 1995. He concluded that business-as-usual supply could continue through most of this century, given moderate consumption growth and political stability in the Middle East.

Riva has worked in the petroleum industry, the Smithsonian Institution and the Congressional Research Service of the Library of Congress. He also served as a senior research geologist for the U.S. Geological Survey.

A recognized expert on world oil and a longtime member of AAPG, he's authored more than 200 publications, including several books and the fossil fuels sections of the Encyclopaedia Britannica.

Riva's broad experience gives him a good perspective on the following question.

Are we close to the point where demand for oil will exceed the world's production capacity?

Short answer: Some pretty smart people think so.

Riva takes a moderately pessimistic view on this. He said a world production peak could occur within five to 10 years, especially if political events turn unfavorable.

"I think that the real danger now is a political one," he said. "The other danger is that if we push things to an extreme in exploration, when there is a drop-off in production there will be a pretty precipitous drop-off."

If that happens, market forces will dampen world oil demand, Riva noted. Declining supply would bring higher prices, which in turn would reduce consumption.

Most geologists don't appreciate the enormous power of the global marketplace or the elasticity of oil demand, he said. And most don't see the Big Picture shaping world production.

"Petroleum geologists are almost all optimistic. You have to be, because you drill so many dry holes," he observed.

"All of them think they can find oil in their particular basins. Few of them look at the whole world."

 


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