Is the world running out of crude oil? Of course - because oil is a finite resource that is being consumed at high and increasing rates. A more relevant issue is when world conventional oil production will peak. There is much disagreement on that score, due to differences about how much oil is in the ground and many other factors that determine oil supply. Some analysts have argued that the production peak will occur within 5 years. The Energy Information Administration, on the other hand, currently projects rising production through at least 2021. Long-Term World Oil Supply: A Resource Base/Production Path Analysis examines some of the assumptions and methodologies behind various estimates in order to account for the wide range.
Projections of the production peak begin with world conventional oil resource estimates, which have increased over time due to better technology, data, and estimation methods. A 1942 estimate, for example, pegged the total recoverable resource base at 600 billion barrels, while a trio of recent estimates by the U.S. Geological Survey (USGS) put the total at a 95-percent probability of 2,248 billion barrels, an expected (mean) resource case of 3,003 billion barrels, and a 5-percent probability of 3,896 billion barrels.
Two further key assumptions are the rates of production growth and decline. In its projection scenarios, EIA's methodology assumes that world oil production grows at rates varying from 0 percent to 3 percent per year until the ratio of reserves to annual production (R/P), currently about 50, falls to 10. Production then is assumed to decline at a rate that keeps R/P about 10, based on experience with the mature industry in the United States, where R/P has hovered between 8 and 12 for 50 years. The initial decline rate in the USGS mean-resource scenario is 7.5 percent per year.
| Projected Peak Conventional Crude Oil Production Years and Rates, USGS Expected World Resource Estimate (3,003 Billion Barrels) | |||
|
Annual Production |
Estimated |
Estimated Peak Production Rate |
|
|
Million Barrels |
Million Barrels |
||
|
0.0 |
2075 |
24,580 |
67 |
|
1.0 |
2050 |
41,238 |
113 |
|
2.0 |
2037 |
53,209 |
146 |
|
3.0 |
2030 |
63,296 |
173 |
| Note: The annual production growth rate in recent years has been about 2 percent. Source: Energy Information Administration |
|||
For the expected (mean-resource) USGS case, EIA projects that world conventional oil production will peak no earlier than 2030 and as late as 2075 (see table above). If the projections include all twelve scenarios derived from using the four production growth rates and the three USGS resource estimates, then the range of peak production years expands to include 2021 at the near end (3.0 percent per year growth in production, 2,248 billion barrels of recoverable resources) and 2112 (0.0 percent growth and 3,896 billion barrels) at the far end. EIA's optimism, relative to other analysts' projections, derives from its use of the U.S. R/P pattern in estimating the production decline rate and its reliance on the USGS resource estimates, which are larger and more technically sound than earlier such estimates.
Long-Term World Oil Supply: A Resource Base/Production Path Analysis, PowerPoint
presentation; 20 pages, 13 figures, 1 table. This presentation is available only on the EIA Website.
If you are having technical problems with this site, please contact the EIA Webmaster at webmaster@eia.doe.gov or call 202-586-8959. For general information about energy, contact the National Energy Information Center at 202-586-8800 or infoctr@eia.doe.gov.
URL: http://www.eia.doe.gov/emeu/plugs/plworld.html
File last modified: August 24, 2000
