Global oil reserve mathematics. How many years of conventional oil do we have left?
"I thought the above article worth a post of its own. After all it is a vindication of what many of us have been saying for years now. And I especially call your attention to the line: “the standard claim that the world has proved conventional oil reserves of nearly 1.7 trillion barrels is overstated by about 875 billion barrels.”
That puts conventional reserves at about 825 billion barrels."
So according to Jefferson and Patterson we had 825 billion barrels of conventional oil in August 2015. Let's try to count how many years we have left of oil reserves (crude + condensate, I count condensate here, because it's a byproduct of crude oil, so condensate stands in proportion to how much crude oil we get, and has always to be counted as a part of crude oil reserves), starting from August 2015. I do not count new oil discoveries, which is nowadays usually, on average 1/6 of the amount that we consume each year, because these are almost always in unconventional oil, and if it is conventional oil, the oil is in so small fields, that the cost of producing it equals the cost of unconventional oil.
Let's first decide how much crude+condensate we consume in one year. At the peak in 2018, we consumed 36,4 billion barrels of oil (all liquids), according to Julianne Geiger in this article on OilPrice.com.
~1/6, or ~17 % of this amount, is unconventional oil (things like natural gas liquids [NGL), refinery gains and biofuels). So we have to subtract ~17 % from 36,4.
So ~17% of 36,4 is ~30.
How many years of ~30 billion barrels yearly consumption does 825 billion barrels give us? Answer: ~27,5 years.
~27,5 years from June-August 2015 (Michael Jefferson's data was certainly some months old, at least) into the future is in the end of 2043.
Almost 8 years have passed since August 2015. ~8 X 30 = 240. We have used 240 billion barrels of crude+condensate since August 2015.
825 minus 240 is 585.
So we have 585 billion barrels of crude+condensate left in our global reserves (how many talk about this?). So how many years does this give us?
585 divided by 30 is 19,5. So we have 19,5 years left of crude+condensate oil reserves. This puts us in the very beginning of the year 2043.
So in 2043 our conventional oil reserves run out. The decline of crude oil+condensate from the peak began in December 2018, so the decline will span over a time period of 25 years. When are we halfway through this time? Answer: 12,5 years into the future, from December 2018, which is in June 2031.
At which point the reserves will be half empty, from the point of the oil peak, which was in November 2018? Not in June 2031, because the decline of our oil reserves begins slowly in the beginning after the oil peak is reached, and the decline accelerates after that, as time goes by, it has an accelerated rate of decline. Therefore it seems reasonable to think that in 2035, at the earliest, as Alice Friedemann has said in an interview, we have half of our crude oil+condensate reserves left, from the point of the oil peak.
And what about the volume of oil exports in the future? If we produce only half of the peak volume of oil (in 2018), in 2035, what happens then with the oil exports by then, because we take it from the surplus oil, and the share of oil exports in our global oil cake is not half the amount of total oil production, but only 37,5 % (in 2021 we had 30 million barrels per day of oil exports, out of roughly 80 million barrels per day of global oil production, if we take only crude+condensate, which the 30 mbd figure of oil exports above entails). From this simple mathematical experiment we can conclude that the end of oil exports will happen well before 2030, or 2030 at the latest. Because if we lose our surplus oil, from the first half period of our remaining oil, and this surplus is 37,5 % of our remaining oil period, then we will lose this surplus after 37,5 % of the way forward, not half of the way forward. And if half of the way forward is 2035, after 12 years, and 6 years is half of that way, then 37,5 % of the way is 37,5 % of 12, which is 4,5. So oil exports end according to this calculation 4,5 years into the future, which is around 2027, which is in harmony with my other calculations of the end of oil exports on my blog "Forest Man".
But what about the unconventional reserves? Won't they give us more time? No, because it's really the conventional oil reserves that matter, because unconventional oil is the high hanging fruit (according to the "low hanging fruit principle" of Richard Heinberg, that we pick the lowest fruit first), and unconventional oil production, too, begins with the low hanging fruit, therefore most of unconventional oil has to be left in the ground in the future as uneconomical to exploit. It cannot really be counted as reserves, because our ability to exploit it today is completely dependent on massive debt, so when this debt bubble burst, unconventional oil becomes too expensive, soon.
But assume that we will be able to exploit up to 200 billion barrels (just a guesswork) of unconventional reserves from 2015 and on. It does not give us much more time. Because if we count all liquids, i.e. the 36,4 billion barrels of oil per year figure above, and add 200 billion barrels to the 825 billion barrels number above, so that we arrive at 1025 billion barrels, we then have to divide 1025 with 36,4, and this gives us 28,2. So from August 2015 and ~28 years into the future, is the year 2045 (1). So it gives us only two years more time, if we count 200 billion barrels of unconventional reserves from 2015 and on. Of these 200 billion barrels we have produced 8 X 6,4 which is 51,2 billion barrels. We have then 150 billion barrels left. Will this amount be produced? Some of it will certainly, but perhaps not all.
But the amount of unconventional is not the real issue. The real issue is rising EROEI, Energy Return on Energy Invested. Because it does not matter, if the question is the timing of the collapse of civilization and oil industry itself, how much unconventional oil we produce, if this is done at the expense of the global economy, through financial self-cannibalization, which in the end will will hurt the oil industry, and spell the demise of this industry itself.
Also, our conventional oil reserves are subject to the same "low hanging fruit principle" as described above, because the cost of those reserves is also rising, because when an oil field ages, its natural decline rate rises, and it costs more and more to extract the oil in it, you have to deploy expensive technology to get the last oil up, so called "enhanced oil recovery". The cost of all this just rises and rises with time. But still conventional oil is, and always will be much cheaper than unconventional oil.
Our oil reserves back in 1998. An outside confirmation of Jeffersons estimates.
Let me end this blogpost with a confirmation for Michael Jefferson's oil reserve estimates from a very official source, namely BP:s Statistical Review of World Energy (which usually overstates the oil reserves by very much nowadays), their oil reserve estimates a long time ago:
Irina Slav from "OilPrice.com" wrote in this article on November 11, 2019, the following:
"In its latest Statistical Review of World Energy, BP estimated the world had 1.7297 trillion barrels of crude oil remaining at the end of 2018. That was up from 1.7275 trillion barrels a year earlier and 1.4938 trillion barrels in 2008. In 1998, the world had 1.1412 trillion barrels in remaining reserves."
We can with some simple mathematics make the last sentence confirm Michael Jefferson's oil reserve estimates above:
How long time elapsed from 1998 to 2015? The time between these years is 17 years.
1.141 billion barrels minus 825 billion barrels equals 316 billion barrels.
316 billion barrels divided by 28 (this is the average consumption between 1998 and 2015, it's my guesswork, I do not find data about this on the internet) is 11,3.
But 11,3 years back from 2015 is 2004, not 1998. Did BP understate the reserves in 1998?
Not by much if we account for the new oil discoveries between 1998 and 2015.
According to this site, "Between 1990 and 2011, the volume of global oil reserves increased significantly from just over 1 billion barrels in 1990 to nearly 1.7 billion".
If we account for global yearly oil discoveries of at most 1/3 of the yearly consumption (today it is 1/6, it is declining all the time), we have accounted for an additional 4-5 years at most to the 11,3 figure above (5 X 28 = 140. 140 is 1/5 of 700.). Then we are almost at 17 years. So BP did not miss the mark by much back then. We just found a lot of unconventional oil since 1998. Remember that 2010 was the year when the shale oil revolution began in earnest. We found the shale oil reserves, and they were huge.
But all this only shows that BP was pretty on spot with its estimates of conventional reserves back then in 1998, and that there is a broad agreement between BP:s Statistical Review of World Energy 1998 and Michael Jefferson's calculations in 2015. The main lesson from this is that we should not mix conventionals and unconventional when we calculate oil reserves, and that we cannot count on our enormous unconventional oil reserves when we try to calculate the remaining amount of reserves that are economical to produce. Why? Because only massive amounts of debt makes unconventional oil possible to produce at all, because of their very low EROEI. And remember that the EROEI rises exponentially, and we have to go exponentially into debt to fund all this. It's not sustainable.
Epilogue
In the end, it's good to listen to the Bible in these matters, to gain wisdom. There it is written: "Teach us to number our days, that we may gain a heart of wisdom." (Psalm 90:12) As professor Guy McPherson likes to say: Our days are numbered.
(1) Professor Charles A.S. Hall (b. 1943) said 2022 in this youtubevideo that we had 25 years of oil left, that puts us in 2047 (he based it on this well-researched scientific paper that he wrote together with Jean Laherrere and Roger Bentley in 2022). That's only two years more than 2045. It's not much. But Hall missed the mark somewhat. But still it is somehow a confirmation of my calculations above, compared to the official oil reserve numbers. The article "20 years later, we still have 40 years of oil left" from June 14, 2007, by Margery Connor on "EDN" is also an independent confirmation of Hall's calculations. So also the article "It's About Forty Years Until the Oil Runs Out" on January 01, 2008, by
P.S. Here is an update of this blogpost posted on this blog 2023-06-17, titled "Some corrections to my global oil reserve math":
