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The Status of U.S. Oil Production

May 11, 2022

The Status of U.S. Oil Production

After the price of oil collapsed in April of 2020, U.S. oil producers reduced drilling new wells and completing drilled wells, which contributed to a production declined to 11.28 mb/d on an annual basis in 2020. Beyond the pandemic problems endured by oil producers, there were depletion problems as well, particularly for tight oil production.  Tight oil comes from the fracking of shale plays.

Government data for oil field production may represent crude oil or crude oil + condensate. If graphs and tables in this report only include crude oil, that will be specified otherwise the data can be assumed to be crude oil + condensate. Typically, condensate represents less than 20% of the total crude oil + condensate production for a field or play.

U.S. crude oil + condensate production increased significantly between 2008 and 2019. That increase was due to tight oil and deep water Gulf of Mexico (GOM) production increases. Tight oil production increased approximately 7.3 mb/d from 2008 to 2019 and deep water GOM production increased approximately 0.67 mb/d. To put 7.3 mb/d in perspective, only 2 countries, other than the U.S., produce over 5.0 mb/d of oil (Saudi Araba and Russia).

In 2021, the price of West Texas Intermediate (WTI) oil increased significantly over 2020 and even beyond the value of 2019 (2019/2020/2021 average prices were $56.99/$39.16/$67.99/barrel) but the average annual U.S. crude oil + condensate production rate was only 11.19 mb/d, down 1.10 mb/d relative to 2019. National Public Radio (NPR) news programs put an interesting spin on the low U.S. oil production rate for 2021 even though the price of oil was significantly higher than in 2020 and even 2019.

The spin from NPR is that the U.S. oil industry is showing great discipline in holding production down to prop prices up. The implication in the spin is that the U.S. oil industry could crank production up to whatever level they desire if that was their goal. But their goal is actually to maintain higher oil prices.

…click on the above link to read the rest of the article…

Why 4°C?

November 7, 2021

Why 4°C?

Climatologists say that civilization can’t survive global warming of 4oC over the pre-industrial average. Some climatologists even say that civilization can’t survive 3oC.  A temperature increase of 4oC over the pre-industrial average sounds fairly trivial so why would that cause civilization to collapse?

First, for Americans, a 4.0oC temperature increase corresponds to a 7.2oF temperature increase.  Maybe that still doesn’t sound too bad but it’s a big problem because the 7.2oF increase is an average over the globe and the temperature increase will not be homogeneous.

Some places will warm more than 7.2oF and some places less than 7.2oF.  The regions that will warm substantially more than 7.2oF include high latitude regions and large landmasses.  We can see that happening already with the global temperature change over the last 50 years (See Figure 1):

chart1

Figure 1:  Global Temperature Change from 1951-1980 to 2011-2020 (From NASA)

Figures II and III are projections of future warming across the globe:

chart2

Figure II: Average annual air temperature change (°C) at the Earth surface for two scenarios of future climate relative to the average of temperature between 1980 to 1999

chart3

Figure III-Warming during days and nights (Maps from NASA)

Not only will temperatures be higher in the future, but precipitation patterns will change over time, illustrated by predictions from the U.S. National Center for Atmospheric Research shown in Figure IV:

chart4

Figure IV-Predictions of future precipitation changes from the National Center for Atmospheric Research

Hotter and drier conditions will make growing food more challenging.  As it is now, a substantial amount of agricultural production in the U.S., as well as in other countries, takes place in regions that rely on irrigation, particularly in the southwestern U.S. and the Great Plains.  The water for irrigation comes from both surface water and aquifer sources.

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The End of Oil is Near, or Maybe Not

September 12, 2020

The End of Oil is Near, or Maybe Not

The cover of the September/October 2020 issue of Sierra magazine states “The End of Oil is Near”.  The corresponding story “The End of Oil?” was paralleled with a recent segment on Democracy Now.  I think that is wishful thinking.  To the extent that oil demand goes down in the future, it will go down because people can’t afford oil distillates at the price producers need to produce the corresponding oil.

The “The End of Oil?” article describes weak oil demand in recent years although it should be stated that global oil consumption increased over 5 million barrels/day from 2015 to 2019.  A major factor for weak oil demand growth in recent years is the increasing level of inequality in the U.S. and world.  There is an increasing population that can’t afford to buy oil distillates, or the devices that use them.  Oil distillates offer the ability to avoid manual physical effort which people tend to select when they can afford to.

“The End of Oil?” article emphasized the increase in global oil production in recent years.  Most of that production increase was associated with unconventional oil resources such as shale oil in the U.S. and oil sands in Canada.  The problem with those unconventional oil resources is that they are considerably more expensive to produce compared to conventional oil.  Conventional oil production is declining over much of the globe which has forced oil companies to move to unconventional resources.

The author describes oil majors, like ExxonMobil and Chevron, as getting into the shale oil business in recent years.  That is not a wise business decision but due to the lack of new conventional resources to exploit.

…click on the above link to read the rest of the article…

 

The World Oil Supply is Infinite: I Know That Because I Believe It

March 13, 2018

The World Oil Supply is Infinite: I Know That Because I Believe It

Earth scientists have been making the case for years that the present level of human activity is not sustainable.  We’re rapidly depleting resources, degrading ecosystems, altering the atmosphere, etc.  What earth scientists are saying is generally not covered by the mainstream media, or is sugar coated, because the mainstream media is an outlet for the corporate perspective on the world.

As an example, in 2017 global crude oil + condensate production (typically used to define oil-this does not include natural gas liquids, biofuels, or other hydrocarbon liquids) was about 30 billion barrels. Cumulative world oil production at the end of 2017 was approximately 1.36 trillion barrels (1,360 billion barrels).  Since WWII, approximately 95% of the cumulative total global oil production has been produced (See Figure 1 by Jean Laherrere-the top brown line represents global oil production).

Figure 1

Jean Laherrere, an international petroleum geologist with over 50 years of experience, had estimated ultimate recoverable oil, excluding extra heavy oil, at approximately 2.2 trillion barrels back in 2013.  It’s a good bet that the ultimate recovery of economically recoverable oil will be less than 3 trillion barrels.  At the clip we’re burning oil, we could go through a significant percentage of the remaining economically recoverable oil in the next 20 years.

Ugo Bardi makes the case that the actual oil production curve will look more like Figure 2.

Figure 2

Bardi is the author of a Club of Rome produced report titled “Extracted” that reiterated the earlier conclusions of the Club of Rome in their “Limits to Growth” report of 1972. Bardi concludes that the problem of depletion is real and that it is progressively getting worse.

In recent years, the rate of global oil discovery has been running less than 1/5th the rate of global oil consumption (Figure 3).  It appears that the 2017 discovery rate will end up around 1/10th of the consumption rate.  The most favorable geologic areas for oil have now been extensively explored so there isn’t that much oil left to find.

Figure 3

About 95% of transportation fuel is oil distillates.  It’s common to hear that electric vehicles are going to take over the motor vehicle market sometime soon and eliminate much of the demand for oil in the not-too-distant future.

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Olduvai IV: Courage
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Olduvai II: Exodus
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