Lies, damned lies and world oil reserves
There are, Mark Twain famously said, three types of lies: "lies, damned lies, and statistics."
The statistics surrounding world oil reserves provide an interesting measure of how far the little photons of truth can be bent by the gravity of money and power. These statistics, supplied by the oil industry and endorsed by the government, are universally considered true. Take Iraq.
According to the New York Times, Iraq has "the second largest proven reserves of oil on the planet, just behind Saudi Arabia." (Nov. 3, 2002)
For the Washington Post, these oil reserves "could attract enormous foreign investment" because they are "the world's second largest after Saudi Arabia." ( Oct. 13, 2002)
According to Mother Jones magazine, "The desert sands of [the Persian Gulf] hold two of every three barrels of oil in the world -- Iraq's reserves alone are equal, by some estimates, to those of Russia, the United States, China and Mexico combined.( March-April 2003)
Tens of thousands of similarly flat statements can be found throughout the US media. It is received wisdom -- unquestioned, rarely attributed and even more rarely qualified with the tiny but crucial adjective: "proven." As in "proven reserves."
Most journalists wouldn't know a proven reserve from Shinola.
By definition, a proven reserve is one that can be developed economically. But many oil reserves fall somewhat below a standard index of affordability and are therefore not counted. In addition, there are political issues. Most proven reserves estimates are kept in synch with Organization of Petroleum Exporting Countries (OPEC) estimates, and OPEC production quotas have long been tied to proven reserves. As a result, known oil producing areas are not explored, reserves are not reported, and reported reserves are discounted for commercial and political reasons.
The bottom line is that there is a lot more more oil out there than conventional wisdom reports from the "proven" reserve category.
Geologists place some of this oil in the category of "identified reserves," essentially an attempt to count economically proven reserves without the political discounts. For the US Geological Survey, Kuwait, not Iraq, has the world's second largest, and the Middle East has 54 percent, not 66 percent, of world oil reserves.
Some of this oil is listed under the category of "recoverable reserves," meaning those not economically available but potentially available. Using this yardstick, the Middle East has 40 percent of the world's oil while Europe and the former USSR have about half that, with North America also holding about half that.
Even this is not "every barrel of oil in the ground." There is yet another category called "unconventional reserves." Here we slip into vast, broad rivers of statistics with murky bottoms. It is well known, for example, that there is far more "heavy" oil in Venezuela than there are "proven reserves" in the rest of the world. Canadian tar sands are also well known as gigantic. And there are supergiant heavy oil fields in the Ural mountains and off the coast of Madagascar, both of which have unknown but potentially vast oil supplies.
The statistics look like this:
Proven reserves (oil industry, US Dept. Energy)
Political measure of oil reserves.981 billion Identified reserves (US Geological Survey)
All economically available oil reserves.1103 billion Recoverable reserves (US Geological Survey)
All conventional oil reserves2272 billion Unconventional reserves (European geologists)
Heavy oils and tar sands, Canada, Venezuela, etc.additional 1,000 to 4,000 billion barrels Given world oil consumption rates of about 30 billion barrels per year, even with fairly sharp growth rates it is clear that oil will not run out until the very end of the 21st century, if then.
What is stunning is just how far removed the conventional wisdom is from the geological reality. How is it that the news media has so badly misinformed the American public?
A good deal of blame needs to be laid at the doors of the US Department of Energy and its Energy Information Administration. Until 2003, references to world oil reserve statistics were not even given. At my request, the EIA provided references to its world oil reserve statistics information. Not surprisingly, they are from the oil industry.
Asked why the US Department of Energy does not use world oil reserve statistics from the US Geological Survey, the EIA has nothing to say for itself, and small wonder. It is a sure mark of the power of the oil industry that it can dominate the primary sources of information for the American public through the Department of Energy without fear of beding contradicted by another US government agency.
The news media does not get off lightly in this either. Not a single ounce of skepticism, of basic fact checking, of reportorial perspicacity, is evident in the record. The news media swallowed this one hook, line, sinker and fishing rod. Reporters and editors have a tendency to avoid intellectual challenges and complex issues. The embarrasing ease with which they are manipulated is one predictable and obvious result.
What is the significance of it all?
First, its easy to let the government set the parameters of the debate. (Hey, these guys have two thirds of the world's oil -- anybody wanna go fight for it?)
Secondly, it's sadly clear how easily the press is lured by a flash of complexity and the hook of statistics.
But most importantly, this is an example of how deeply capitve our ways of knowing are to expertise and vested interestes.
Of course, world oil reserves are not the only factor in Middle Eastern politics. But the possibility of eliminating oil as the underlying point of contention in Middle Eastern politics is, by any measure, something we ought to consider.
Links:
The Oil Reserve Fallacy by Bill Kovarik
Oil: The illusion of plenty By Alfred Cavallo , Bulletin of Atomic Scientists, January/February 2004, Volume 60, No. 1, pp. 20-22, 70. Ooops. Cavallo forgot to plug unconventional reserves into his calculations. Instead of a world oil peak in the neighborhood of 2010 or so, the peak would have to move back much further, as at current consumption rates there is 158 years of oil supply remaining.
Greepeace Guide to Oil Reserves and Resources
British Petroleum on World Oil Reserves
UN Intergovernmental Panel on Climate Change (UN) -(2001 report section 4.4 on Resource Availablililty) - "In the absence of climate policies, none of the SRES scenarios depicts a premature end to the fossil-fuel age. Invariably, cumulative fossil-fuel use to 2050 (not to mention 2100) exceeds the quantities of fossil fuels extracted since the onset of the Industrial Revolution ..."
Typical conventional wisdom -- physics class in Canada.