Top it off with the fundamental fact that demand is growing, as more and more people in China, India and the rest of the world begin wanting to benefit from the oil economy. The market is reading these signals and reacting. At the same time, there has been some finger pointing and suggestions that the prices are deliberately being kept artificially high and that someone, somewhere is making a lot of money. Also, looming in the background, just behind the headlines, are much deeper concerns about the possibility of oil production having peaked.
The argument is not that oil is running out right now, but that it is getting harder and more expensive to increase the levels of production beyond the current 85 million barrels per day. There is no reason to panic just yet, but fundamentally we need to understand the long term trends. When discussing oil prices, many analysts like to provide a long term overview of the changes, going back to the oil shocks in the s.
Violent struggle and terrorism in the Middle East and in the rest of the world are correlated with surging oil prices. Other analysts point to the need to consider inflation when looking at oil prices, to get things into proper perspective.
Yes, prices are high they say, but if you compare them with those of the past and factor in inflation, then the highest prices recorded were in December Nevertheless, this line of argument has been important in calming concerns. There are a growing number of people who believe that we have either reached, are to close to, or will approach in the next few years, the peak of oil production. The Internet is full of websites dealing with the peaking of oil and gas, and many organize around the Association for the Study of Peak Oil and Gas.
Peak Oil is not new. The idea has been around since the s, when Dr. King Hubbert made his predictions about the peaking of oil production in the US. There is a clip on YouTube where he outlines his surprisingly accurate predictions. What the Peak Oil community of scientists have done is apply the same methodology for the global supply of oil.
The debate around the methodology, the data and the results has been intense and there is no consensus. In April , Worldoil. They concluded that prudent risk minimization requires that mitigation measures are implemented around 20 years before peaking.
The industry felt the pressure and began building terminals to import liquefied natural gas, or LNG. But while those import terminals were being built, the industry made a major breakthrough. Though we had been using hydraulic fracturing to extract hydrocarbons from formations for decades, when the industry combined that with horizontal drilling, we cracked the code to economically producing natural gas — and then oil — from shale.
Companies were quick to apply these combined technologies to formations across the country and even advance them for more efficient production. In the process, the United States has re-established its reputation as an energy superpower. The United States is now the global leader in total combined crude oil and other liquids production, overtaking both Saudi Arabia and Russia.
As a result, some of the LNG import terminals I mentioned above have been converted into export terminals. To move these fuels across oceans, we convert natural gas into LNG. This enables it to be shipped safely and efficiently aboard specially designed LNG vessels. After arriving at its destination, we return the LNG to its gaseous state for delivery through local pipelines.
Other technological advances are less transformative for the world energy supply, but they contribute to our efforts to limit the impact of our operations on the environment.
For example, we use state-of-the-art drones for early detection of any unexpected emission releases. We use stationary infrared cameras to look for potential gaseous leaks to ensure the integrity of our equipment and operations.
And we use technology to continually evolve our operations to meet tightening environmental standards, such as those to reduce sulfur content in US gasoline.
Although standard industry practice is to remove the CO2 from the natural gas and vent it to the atmosphere, at the Gorgon Project we plan to extract and inject the naturally occurring CO2 into a formation more than two kilometers beneath the surface.
This is game-changing technology to protect the air. This system supports mangrove and estuarine habitats for a range of marine fauna, such as migratory shorebirds, turtles, sawfish, and recreational crab and finfish species. Even as we celebrate these achievements, our focus is on the future. In Argentina, natural gas fuels 15 percent of all cars, due to policies meant to favor the domestic natural gas industry.
The new research, though encouraging, does not describe a transportation future free of worry. Instead, the researchers recommend a shift in attention to the various alternatives to conventional oil. The alternatives to conventional oil emit varying amounts of greenhouse gases, while large-scale production of biofuels could have a disruptive impact on food prices and on local ecosystems where the plants are grown.
The study forecasts global oil demand through under a variety of scenarios for economic growth, population, efficiency gains, and fuel substitution. Source: Stanford University. Search for:. Science Health Culture Environment. Share this Article. You are free to share this article under the Attribution 4.
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