br1756

1,238 Billion Barrels of Oil Reserves: Is This an Oil Price Bubble?

Let's do the math:

85 million barrels per day times 365 days = 31.025 billion barrels/year

So 1238 billion barrels = 40 years oil at current consumption rates

If you up consumption to 100 million barrels per day, that works out to 34 years worth of oil.

I don't know about you -- I am more than 34 years old. The idea that the lifeblood of the world economy could run out within the lifespan of a young adult is bone-chilling. I should think the warning bell has been sounded loud and clear with the latest rise in the price of oil.

Incidentally, my take on peak oil is that the oil will not run out in 34 years, because there is no way we will achieve 100mbpd production. Rather, production shortfalls will force us to figure out how to get by on 60mbpd, and eventually 40mpbd. The story will be all about how we can weather the supply shocks while still trying to find technological alternatives to oil.