Oil reserves, between uncertainties and the future

What is the future of oil and which countries have the largest number of reserves?

by Lorenzo Ciotti
Oil reserves, between uncertainties and the future
© David McNew / Staff Getty Images News

The determination of oil reserves is not affected by technical and economic uncertainties. The technical uncertainties arise from the fact that the volumes of hydrocarbons contained in the reservoir are estimated almost exclusively through data obtained with indirect methods.

Economic uncertainties include the difficulty of being able to predict the future trend of extraction costs and sales prices of the hydrocarbon. The commercial availability of new extraction technologies is also difficult to predict with complete certainty.

The level of uncertainty on reserves is therefore maximum when potential new deposits are estimated, decreases at the moment of their discovery through well drilling, and during the production period and becomes zero when the reserves that can be produced from the field are eliminated as all the extractable hydrocarbons are actually been produced.

The degree of randomness of the reserves is expressed through their classification according to defined categories.

Oil reserves
Oil reserves© WPA Pool / Team Getty Images News

There are different classification schemes, that of the Society of Petroleum Engineers (SPE) is internationally widespread and distinguishes between Resources and Reserves. The impossibility of calculating exactly the quantity of reserves and resources gives space to various more or less optimistic forecasts.

The situation in the early 2000s appeared more serious than MIT had predicted. From the data published annually by BP it was found that the quantity of oil used from 1965 to 2004 was 116 billion tonnes, the reserves still available in 2004 were estimated at 162 billion tonnes.

Several other studies have fully or partially confirmed these conclusions; in particular, those of the American geologist Marion King Hubbert (see also Hubbert peak) and subsequently, starting from these, those of Colin Campbell and Jean Laherrère should be mentioned.

According to these studies, the quantity of oil extracted from a nation follows a bell curve and the maximum extraction of crude oil per unit of time occurs when half of all the extractable oil has been extracted. This is what occurred in the USA where oil extraction peaked in 1971 and then declined as in a bell curve as predicted by Hubbert.

Venezuela, Saudi Arabia and Canada are the countries with the largest oil reserves.