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Nick Cunningham

Nick Cunningham

Nick Cunningham is an independent journalist, covering oil and gas, energy and environmental policy, and international politics. He is based in Portland, Oregon. 

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U.S. Has World’s Largest Oil Reserves

U.S. Rig

The U.S. holds more oil reserves than anyone else in the world, including Saudi Arabia, Russia, and Venezuela.

That conclusion comes from a new independent estimate from Rystad Energy, a Norwegian consultancy. Rystad estimates that the U.S. holds 264 billion barrels of oil, more than half of which is located in shale. That total exceeds the 256 billion barrels found in Russia, and the 212 billion barrels located in Saudi Arabia.

The findings are surprising, and go against conventional wisdom that Saudi Arabia and Venezuela hold the world’s largest oil reserves. The U.S. Energy Information Administration, for example, pegs Venezuela’s oil reserves at 298 billion barrels, the largest in the world. Rystad Energy says that these are inflated estimates because much of those reserves are not discovered. Instead, Rystad estimates that Venezuela only has about 95 billion barrels, which includes its estimate for undiscovered oil fields.

Moreover, Rystad argues that there are not uniform ways of measuring oil reserves from country to country. Some countries report proven reserves, using conservative estimates from existing oil fields. Other countries, like Venezuela, report undiscovered reserves. But Rystad applied similar metrics to all countries in its report to make comparisons easier. “An established standard approach for estimating reserves is applied to all fields in all countries, so reserves can be compared apple to apple across the world, both for OPEC and non-OPEC countries. Other public sources of global oil reserves, like the BP Statistical Review, are based on official reporting from national authorities, reporting reserves based on a diverse and opaque set of standards.” The latest assessment, Rystad argues, paints a more accurate portrait.

The U.S., then, sits atop with its oil reserves. Rystad notes that Texas alone could have 60 billion barrels of oil.

Over at Reuters, John Kemp uses the data to take a look at Saudi Arabia, long thought to have a vast and seemingly endless pool of oil upon which to draw. He notes that the Saudi government suddenly upgraded its oil reserve estimates from 170 billion barrels in 1987 to 260 billion barrels in 1989. Since then, Saudi oil reserves have been unchanged for more than 25 years at 260 billion barrels. As Kemp wryly puts it, “If the government data is accurate, the kingdom has managed the remarkable feat of exactly replacing each produced barrel with new discoveries or increased estimates of the amount recoverable from existing fields.” Related: Fresh Niger Delta Attacks Could Send Oil Prices Up

Of course, nobody knows the true extent of Saudi oil reserves, which is a closely guarded state secret. But the economic transformation initiated by the Deputy Crown Prince Mohammed bin Salman could start to change things. The prince has cited his plans to help steer the Saudi economy away from its dependence on oil sales. Part of that plan includes a partial IPO of Saudi Aramco, the state-owned oil company. Of course, part of any privatization would need to include a valuation of the company, and to properly assess the value of Aramco, the company would need to disclose more data on its reserves. Whether or not that happens remains to be seen.

Nevertheless, Rystad still puts the U.S. ahead of Saudi Arabia in oil reserves, at 264 billion barrels compared to Saudi’s 212 billion barrels.

The rankings change when simply looking at oil reserves from Proved + Probable (commonly referred to as “2P”), an estimate from existing oil fields. Saudi Arabia has 120 billion barrels of 2P oil reserves, compared to the U.S.’ 40 billion barrels.

On a global basis, Rystad estimates that the world has about 2,092 billion barrels of reserves, or about 70 years’ worth of oil at today’s production rate of 30 billion barrels per year. That compares to the 1,300 billion barrels produced around the world in history. While there is a lot of oil left then, according to this estimate, most of it is of the unconventional variety – whether shale or oil sands or other difficult-to-produce forms of oil. In short, Rystad concludes: “this data confirms that there is a relatively limited amount of recoverable oil left on the planet.” It goes on to caution that business-as-usual won’t work. “With the global car-park possibly doubling from 1 billion to 2 billion cars over the next 30 years, it becomes very clear that oil alone cannot satisfy the growing need for individual transport.”


By Nick Cunningham of Oilprice.com

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  • Bill Simpson on July 12 2016 said:
    Keeping the financial system, which is overloaded with debt, from collapsing after the peak in global oil production is reached, will be tough. Reflect on a few facts based on physics and finance.
    It takes energy to do work. The vast majority of that energy to move goods and people today comes from oil. That is because oil is still cheap and available in a huge amount. So what has to happen when less oil is available at any price? Less transportation work will get done. Substituting a more costly, or less efficient fuel for oil based fuels will yield a similar result. The economy will be forced to shrink. It is easier to cut a football field with a gas mower, than with an electric one.
    A shrinking economy has a name. It is called a recession. So far nobody has discovered a way to stop recessions from happening. They generally end after demand for goods and services recovers, and interest rates are lowered by central banks. Interest rates at zero, and an aging population, might make that solution difficult during the next recession.
    But even without recessions, less work being performed will cause massive problems for banks. They are great businesses to be in as long as the economy is growing. If a recession lasts a long time, banks tend to fail, because businesses can't repay loans. That is happening to banks in Italy right now. Without a massive bailout, they will eventually fail. Failure to collect on loans does that.
    Less and less oil available to move goods will generate more and more business failures. The accelerating downward spiral could collapse the entire financial system. If you think that is a radical idea, remember how close the banking system came to collapse in 2008. And that crisis was manmade. Physics was not involved. We can't change the physics of needing fuel to do work. We could create the TARP bailout, although we added more debt to keep the system from collapsing. Today, global debt vastly exceeds economic output.
    Consider that nothing happens without a functioning banking system. It fails, and you soon starve. That is the danger of peak oil. We won't have time to gradually wind down our standard of living, and adjust to getting poorer from having less cheap energy at our disposal. The banking system evolved only to function in an expanding economy. That is the way things have been since the dawn of the Industrial Revolution. Banks aren't made to exist in an energy starved shrinking economy. But our economy can't function without banks to transfer and create money.
    Governments will try all kinds of crazy stuff to solve the coming problem. Creating a lot of fiat currency out of thin air will be one of them. It will work, but only for a limited time. Nobody can figure out when the collapse will begin. It could begin next year, or 15 years from now. But it is probably inevitable. Negative interest rates are certainly not a good sign. Whenever it happens, it will probably be quite rapid, not something that takes years to play out.
    Good luck. And I could be wrong. Let's hope so.
  • Patrick Verhoeven on December 02 2016 said:
    If you watch this video (go to 27:12 min:sec):


    of Standford University there is actually much more oil, around 5,5 trillion barrels, which can be produced for a price lower than 80 dollars per barrel. If 1,3 trillion is consumed thus far then we still have 4,2 trillion to go which is enough for 140 years !
  • Steve on December 28 2016 said:
    So this fits in line with what my grandfather was talking about. See on the western hemisphere there is around 1 trillion barrels of oil. Between venezuela, canada, brazil and the united states we are looking at a scenarip in which those 2-3 billion cars in China, india and Africa are going to need fuel. Now the middle east will run out of this oil within 20-30 years. And that is when the price of oil will go from $50 a barrel to $500 a barrel. And this hemisphere will have all of the worlds remaining oil and we will generate between $500-900 trillion. This has been the plan for a very long time. The entire strategy is genius. Get the rest of the world addicted to cars and oil. Then have them sell every last barrels of their oil for the rock bottom price of $50 a barrel. Once there reserves are dried up the rest of the world will still need oil. And thats when americas secret economic plan kicks in. You have to realize that after world war 2 the united states essentially drew up a foreign policy based on this concept. That we would get the world to sell their oil for peanuts. And then sell our oil for the price of gold in order to ensure that by the time its 2150 and all of the worlds oil is gone. America will have the largest economy, military and be the lone super power of the world. China has no oil, there willing to start WW3 in the south china sea for a few billion barrels. Imagine how china and India are going to fare when they're populations have to pay canada, Venezuela and the united states $200-500 a barrel for oil. When gas is $20 a gallon and the western world has moved on to electric cars. And then will make a fucking fortune by rebuilding their entire infrastructure to handle electric cars. It's a big game, And the united states government has been planning on this for a long long time. The ultimate goal being to be the top world power once the worlds cheap oil has run out.
  • ANUVART KUMAR on January 24 2017 said:
    great news for u.s.a , congratulations.
  • Marcel on February 26 2017 said:
    Steve.... keep on dreaming. America will need oil more than anyone else, it will use its own and will want more.... military machines and an expanding population need a lot of oil. The Middle East, India, Africa and even China, have a lot of sunshine.... the reliance on oil is already reducing. That is the big plan; clean and sustainable energy. In 2125, American will be begging for people to buy its oil at $10 a barrel. Plus, there will be more discovering of oil is the large seas and oceans and the large desert in Africa, Arabian peninsula and Chinese desert. The map of the big oil producers will change dramatically. America is already not a superpower, Russia is: you see it in Syria, Ukraine, Turkey, Libya, and is has now infiltrated the Gulf.
  • Chuck Field on March 06 2017 said:
    And I have some land I would like to sell you in Florida. Reserves numbers are notorious for being soft and inaccurate. What you want to show if recoverable reserves which is based on things like oil price and recovery cost. Exxon recently wrote down their reserve life from 17 to 14 years due to the oil price and lifting cost of heavy oil in Canada. I have the US at about number 11 with around 7 to 11 years of reserves depending on how much we import. Most of the worlds reserves are in the middle east under Saudi Arabia, Iran, Iraq, Kuwait, UAE and Qatar. That is why the US, Russia and China are all positioning themselves for the end game. Most other countries in the world already know this. For some reason we here in the US are living in denial of this fact. Your article on the US being number 1 in reserves does not help this knowledge.
  • Andy Clark on May 11 2017 said:
    Oil was deposited with the water when earth collided with comet or other space object long ago. It is not from fossils.

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