I honestly don't understand how you seem so confident making this leap of fate. Yes, they have more "proven oil reserves", but US oil exploration is also tightly regulated. We don't exactly know what we have in the Gulf, ANWR, or along the eastern seaboard, so making your stretch is only possible as long as the Dems keep our oil industry handicapped, essentially manipulating the known supply. Again, they're artificially inflating energy prices by over-regulating our own oil industry. They don't have this in the Middle East as oil is their primary industry with exploration and production supported by their leaders.
It's not really a stretch. Yes, America
may be sitting on more oil, but until you've found it, it can't be considered a
proven oil reserve. Countries with more proven oil reserves are going to naturally export more oil than those with fewer proven oil reserves, regardless of the reason why there are fewer proven oil reserves in certain countries. You may be sitting on it, but until you find it, you can't export it. On the other hand, if you're sitting on it
and you've found it in abundance, then it's a pretty safe assumption that you will export oil in relative proportion to the amount that you have readily available in the proven oil reserves.
Sort of... I see what you're saying, but we're nowhere near scraping the bottom of the "barrel" when it comes to the supply available in these "proven oil reserves". Then, there's South Dakota, Norway, etc., etc... The known supply is far greater than the current production run rates over decades, if not centuries. I see how "supply" directly impacts futures trading of cows, corn, wheat and pork bellies, but it seems to be a bit of a stretch with oil. Production capability would seem to be a greater influence on the futures markets, and known supplies depleting to a level that would significantly impact future price is likely less of a concern right now. Of course, I'm looking at the overall picture and not considering the micro-issues associated with a particular region, company and/or single reserve.
Definitely, the proven oil reserves that we have found so far will last us quite some time, and there are even other reserves that have not yet been exploited. However, various governments (and probably OPEC) keep estimates of whether oil reserves are decreasing or increasing. There have been a number of years when fossil fuel oil reserves have "decreased," according to the "experts." This can cause the price of oil to increase. Remember from 1990 - 1999, gas consistently hovered at around 99 cents a gallon? In mid to late 1999, the price spiked to around $1.10 and then aggressively increased from there, maintaining an average of about $1.40 for 2000-2003'ish before spiking again due to the Iraq war, Hurricane Katrina, etc.
This was largely due to the alleged "energy crisis" that was referred to in reports from the United States Department of Energy. Some of these reports went so far as to claim that oil reserves were decreasing in size, but most of the reports focused on a more quantifiable and believable stance: the rate at which we are finding new oil reserves is decreasing so that we will not be able to sustain our rate of oil consumption, which continued to grow each year. The last source I checked indicated that, based upon our current consumption rate and knowledge of existing oil reserves, we would be out of oil within 47 years if no additional reserves were to be found.
Now, as you said, there are a variety of oil reserves that have yet to be discovered, but with a futures market that revolves around speculation, these reports on the status of proven oil reserves do affect prices, even if those reports don't necessarily indicate that we're close to scraping the bottom of the barrel yet. Afterall, it's a futures market, so the speculators are more worried about instability in the long run than they are stability in the present.
124 Replies
21513 Views