It cannot be denied that the industrial revolution and the current economies of first world countries run on fossil fuels like oil. With prices rising, the issue of oil supply is important.
How important is oil in our world? Well, imagine if all the oil in the world just disappeared tomorrow. What would be the impact? It would be huge. All the ships that carry goods around the world would be unable to do so. The truckload system would stop. I couldn’t drive to the grocery store. Even if he walked there, he would find little to buy, since the trucks that delivered it would no longer be running. Do you enjoy car racing? Not anymore.
All of these questions and scenarios raise all sorts of questions about our energy needs. As countries like India and China grow like crazy, so do their energy needs. Add in the already thirsty needs of the United States, Europe, and other areas, and you’re in high demand. A significant amount of this energy comes in the form of oil.
So how much oil is left? The figures are somewhat vague because it is generally accepted that we have not found all the available oil. We will find more, but it will be harder to find and more expensive to get. Regardless, the current argument fits when we will start to see oil reserves start to decline. You may be surprised to learn that many point to… 2007. This date comes from none other than Goldman Sachs, a prominent and respected company. It is based on the fact that 2005 represented a decisive year in exploration. Specifically, the year saw a massive drop in the announcement of new oil production projects and locations. While the exact date is obviously unknown, it is clear that it is imminent.
As for the hard numbers, it is estimated that there are about 1.27 million barrels of oil in current reserves around the world. While this may sound like a lot, it represents around 44 years of oil supply at current usage levels. The problem with this estimate, however, is the fact that the growth of India and China, with their huge populations, will increase demand substantially. Since no one knows how fast emerging market demand will be, it’s hard to determine the actual number of years left. Estimates range from a low of 25 years to a high of 40. Yet another caveat to this figure is future oil discoveries. While we will find more, no one believes it will be a substantial amount.
While we clearly have enough oil to cover our energy needs for at least the next few decades, it is undeniably a limited resource. With a resource of this value, we can expect military and political tension for control of it.