Oil Production

• Oil prices are set by supply and demand in the world market, and by oil trading on global financial exchanges.
• The world consumes approximately 85 million barrels of oil per day. Proven (P95) and probable reserves (P50) are approx. 1,200 million barrels. This means that at current production rate oil will suffice for 38 years.
• IEA's newest estimate of depletion of global conventional reserves is 6.7% annualy. This means 16 years only.
• Reserves are stated by oil companies, oil exporting countries and importers. All have incentive to overstate.
• Three years ago, the OPEC countries had spare production capacity of 6 million barrels per day that could be brought online in times of emergency to keep prices down. This spare capacity is down to 2 million barrels per day—nearly, all in Saudi Arabia. In coming years demand growth rates will severely test producers’ capacity to bring enough new oil online.
• It generally takes seven to ten years to move from oil discovery to production.
• The total costs for drilling tripled between 1990 and 2004.

• Non-conventional oil means tar sands, oil shale, and heavy oil that cannot be pumped the way conventional crude oil can.
• The process is technically difficult and more expensive than conventional crude oil production. Nonetheless, production costs for tar sands oil have fallen to around $15 per barrel, making them a viable fuel source at today’s barrel prices (around $70).

"Citizens' Alliance for Resposible Energy"
Schlumberger Business Consulting, 2006, "Surviving the Skill Shortage"
The Oil Drum: Europe, The Big Crew Change: Turnover in the Oil workforce