{"id":8961,"date":"2015-06-09T19:36:13","date_gmt":"2015-06-10T00:36:13","guid":{"rendered":"http:\/\/olduvai.ca\/?p=8961"},"modified":"2015-06-09T19:36:13","modified_gmt":"2015-06-10T00:36:13","slug":"why-eia-iea-and-bp-oil-forecasts-are-too-high","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=8961","title":{"rendered":"Why EIA, IEA, and BP Oil Forecasts are Too High"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/ourfiniteworld.com\/2015\/06\/09\/why-eia-iea-and-bp-oil-forecasts-are-too-high\/\" rel=\"bookmark\">Why EIA, IEA, and BP Oil Forecasts are Too\u00a0High<\/a><\/h3>\n<p>When forecasting how much oil will be available in future years, a standard approach seems to be the following:<\/p>\n<ol>\n<li>Figure out how much GDP growth the researcher hopes to have in the future.<\/li>\n<li>\u201cWork backward\u201d to see how much oil is needed, based on how much oil was used for a given level of GDP in the past. Adjust this amount for hoped-for efficiency gains and transfers to other fuel uses.<\/li>\n<li>Verify that there is actually enough oil available to support this level of growth in oil consumption.<\/li>\n<\/ol>\n<p>In fact, this seems to be the approach used by most forecasting agencies, including EIA, IEA and BP.\u00a0It seems to me that this approach has a fundamental flaw. It doesn\u2019t consider the possibility of continued low oil prices and the impact that these low oil prices are likely to have on future oil production. Hoped-for future GDP growth may not be possible if oil prices, as well as other commodity prices, remain low.<\/p>\n<p><strong>Future Oil Resources Seem to Be More Than Adequate<\/strong><\/p>\n<p><span id=\"more-39891\"><\/span>It is easy to get the idea that we have a great deal of oil resources in the ground. For example, if we start with\u00a0<a href=\"http:\/\/www.bp.com\/en\/global\/corporate\/about-bp\/energy-economics\/statistical-review-of-world-energy.html\">BP Statistical Review of World Energy<\/a>, we see that reported oil reserves at the end of 2013 were 1,687.9 billion barrels. This corresponds to 53.3 years of oil production at 2013 production levels.<\/p>\n<p>If we look at the United States Geological Services 2012 report for one big grouping\u2013<a href=\"http:\/\/pubs.usgs.gov\/fs\/2012\/3042\/fs2012-3042.pdf\">undiscovered conventional oil resources for the world excluding the United States<\/a>, we get a \u201cmean\u201d estimate of 565 billion barrels. This corresponds to another 17.8 years of production at the 2013 level of oil production.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why EIA, IEA, and BP Oil Forecasts are Too\u00a0High When forecasting how much oil will be available in future years, a standard approach seems to be the following: Figure out how much GDP growth the researcher hopes to have in the future. \u201cWork backward\u201d to see how much oil is needed, based on how much [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[2272,251,1233,353,416,6250,6248,1232,5741,681],"class_list":["post-8961","post","type-post","status-publish","format-standard","hentry","category-energy-2","tag-bp","tag-eia","tag-gail-tverberg","tag-gdp","tag-iea","tag-oil-forecasts","tag-oil-resources","tag-our-finite-world","tag-ourfiniteworld","tag-resources"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8961","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8961"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8961\/revisions"}],"predecessor-version":[{"id":8962,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8961\/revisions\/8962"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8961"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8961"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8961"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}