More drilling needed to face coming oil crunch

If you were to ask me what single issue concerns me the most, I would tell you I am most concerned that the American public is not aware of what they are about to be faced with.

It is also concerning to me when I see Russia, the world’s largest oil producing country, awash with oil revenues, reach out to Saudi Arabia and the OPEC nations, hinting of a possible alliance with the oil cartel. Combined, they would control over 50 percent of the world’s oil production.


Oil is finite, meaning it depletes. Today, the world’s crude oil depletion rate according to some experts is close to 10 percent. It’s important to understand that Gawhar, the largest oil field in the world in Saudi Arabia, is in a decline rate of 8 perecent, and Cantarell, the second largest oilfield in the world belonging to Mexico, is in a 10 percent decline.

Let’s assume the current world crude oil production is at 86 million barrels per day. Using a very conservative decline rate of 7 percent, the world would have to discover a new 6 million barrels per day next year to stay even with current world supplies.

Let’s also assume world oil demand growth is 2 percent. That would add approximately another 2 million barrels per day. The world will have to discover 8 million new barrels of oil next year to meet decline and growth. That is equivalent to discovering the total production of the United States and Mexico.

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