Kurt Cobb: Oil Optimists Grow More Outlandish

As the troubling realities of future oil supplies begin to penetrate official circles, the oil optimists are making even more outlandish claims.

Last month the pugnacious Michael Lynch, an independent energy analyst and perpetual oil supply optimist, told the readers of The New York Times that the world’s total endowment of oil is actually around 10 trillion barrels of which we have only discovered 2 trillion so far. That leaves 8 trillion to be extracted.

Lynch admits that with current technology only 2.5 trillion barrels of what remains can be produced though he believes future advances in technology will greatly increase the recoverable amount. He adds that he is not even including production from tar sands or other nonconventional sources. He writes all this as if it were a matter of settled fact and without citing a single piece of evidence for his views.

Lynch’s most recent boast is part of a series of ever-escalating estimates by oil optimists starting a decade ago. Today, such estimates carry with them a tone of desperation as the evidence mounts that we are approaching a worldwide peak in the production of oil. The timing of peak oil production is important because there is currently no viable substitute for oil. A nearby peak would raise havoc with a global economy addicted to ever-increasing supplies of cheap oil to fuel its growth. If oil supplies begin to decline soon, that growth may be difficult and perhaps impossible to achieve.

Lynch’s estimate finds its provenance in the U. S. Geological Survey’s (USGS) World Petroleum Assessment (WPA) which places the world’s total endowment of conventional oil at about 3 trillion barrels. The WPA was published in 2000 and has served as a launching point for the optimists ever since. They forget, however, that the report included three scenarios: a low case, a mean or reference case, and a high case. The low case puts the world’s total endowment of conventional oil at about 2.2 trillion barrels which means that we have produced about half of what the world has. This estimate is more in line with the pessimists’ view. The high case–to which the agency assigns a 5 percent probability–puts the total endowment at 3.9 trillion barrels. This high case is often cited by the optimists without any qualifier that it is a low-probability outcome, at least in the view of the USGS. The high case is close to Lynch’s current recoverable estimate of 3.5 trillion barrels though he clearly sees that number growing dramatically over time.

Cambridge Energy Research Associates (CERA), a longtime cheerleader in the optimists’ camp, places the world’s endowment of recoverable conventional oil at precisely 3.74 trillion barrels which is in line with the WPA’s 5-percent probability high case. CERA says that if unconventional oil resources–such as tar sands, oil shale and arctic oil–are added to this number, the total reaches precisely 4.82 trillion barrels. The firm notes that even this number is “likely to grow.”

Scitizen