The oil crisis

[gae]

A lot of folks can't understand how we came
To have an oil shortage here in our country.

Well, there's a very simple answer. Nobody bothered to check the oil.

We just didn't know we were getting low.

The reason for that is purely geographical.

Our OIL is located in:

ALASKA

California

Coastal Florida

Coastal Louisiana

Kansas

Oklahoma

Pennsylvania

And

Texas

Our DIPSTICKS are located in Washington, DC.
Any Questions ???

[reason]

Yeah...where'd you get that? Talk radio?

<font color="#CC6600" size="1">[ June 21, 2008 10:41 AM: Message edited by: The Big Sexy ]</font>

[reason]

What's the deal with oil?
By Richard I. Gibson ? 2005
This essay appeared originally in the Butte (Montana) Weekly for Dec 21 & 28, 2005

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For close to three-quarters of the 20th Century, the United States was the world leader in oil production. What happened? The short answer is that we're over the hill when it comes to oil resources. The U.S. oil production peak came 35 years ago, in 1970 - and the volume sucked from the ground has been declining ever since. In 1970, U.S. production of 9.6 million barrels per day (Mb/d) amounted to 43% of all the oil pumped in the world. In 2004, domestic production averaged 5.4 Mb/d, the lowest since 1950, and added up to only 13% of the world total - despite the fact that our consumption is more than 25% of the world's oil and about 45% of the world's gasoline - and we harbor just 5% of the world's population.
Consumption is the key. With small fluctuations, U.S. oil usage has climbed steadily for the past 50 years. From 5.6 Mb/d in 1949 (6% supplied by imports) to 13.8 Mb/d in 1970 (23% from imports) and 20 Mb/d in 2004 (60% from imports), America's unrelenting thirst for petroleum has driven the consumer end of the market for a hundred years. And by late 2005, consumption had climbed to 20.5 Mb/d, fueled by net imports of 13.2 Mb/d - more than 64% of the total.

How much is 20 million barrels a day? A 42-gallon oil barrel is maybe four feet high. If you laid 20 million of them end to end, they would stretch more than 15,000 miles - every day! In terms of gallons of all oil products, if a 1-gallon can is a foot wide, lined up those cans would extend about 163,000 miles - enough to circle the earth at the equator 6? times - every day.

Not all the oil used goes to make gasoline, of course - there's fuel oil, jet fuel, the chemicals to make all the plastic in the world, as well as lubricants, greases, lipstick and petroleum jelly. But U.S. consumption of gasoline is astonishing - we burn it up at a rate averaging more than 320 million gallons per day, or about 3700 gallons per second, 24 hours a day, 7 days a week. That's enough one-foot-square gallon cans to cover a football field every nine seconds.

So which countries supply our imported oil? Few people can name the top four countries, which together supply about 60% of our crude oil imports. In August 2005, Canada and Mexico were in a virtual tie for first, each providing about 16% of total imported petroleum. Saudi Arabia, which most people would include on the top four list, was No. 3 with about 14%. Venezuela (13%) rounds out the top four sources of American oil. Up-and-coming Nigeria is Number 5, with 11% of our imports. The rest of the top 10, in order, are Angola with 6% and Iraq, Algeria, United Kingdom, and Ecuador, at about 3% of our imports each.

The amount of oil we import from each country fluctuates somewhat from month to month and year to year. For most of the past 5 years, Canada was the clear leader, at about 17-18%, and Saudi Arabia was number 2, with 14-15%. During the 1960s, Venezuela was far and away our greatest supplier.

What can be done about our import dependency? Drill more wells? In 1972 we had 508,000 pumping wells. Many of those wells have dried up or become uneconomical to operate, but despite that, in 2004 about 510,000 wells were pumping oil. We're drilling about as many new wells as we can, both technologically and economically. The problem is the average volume per well - down from almost 19 barrels per well per day in 1972 to about 10.5 barrels per well per day in 2004. The same number of wells pumps only about half the oil of 30 years ago. You can't make a 10-barrel-a-day well pump 1,000 barrels, no matter what you do. There are some enhancement techniques that squeeze the last drops out of an oil field, but those are short-term fixes that do not provide great volumes of crude.

In contrast to America's 10-barrel-per-day average for each well, the few wells in Saudi Arabia average about 6,500 barrels per day per well.

What about ANWR - the Arctic National Wildlife Refuge? The controversy rages. As of today, there is no known oil in ANWR - it can't be known until the rocks are drilled. The U.S. Geological Survey, using sophisticated estimation techniques that factor in the geology and other "knowns," gives a best guess for the amount of oil that MAY be in ANWR at 10.4 billion barrels of technically recoverable oil. That sounds like a lot, but it's less than Prudhoe Bay contained. At about 13 billion barrels, Prudhoe was the largest oil field in North America, but most of its oil has been produced. In contrast, the world's largest oil field, Ghawar in Saudi Arabia, contained about 85 billion barrels, with much remaining.

That guesstimate of 10.4 billion barrels in ANWR works out to 520 days' supply at our current rate of consumption. But in reality, even if it's there, it won't be produced in a whoosh. Any oil will take years to come on-stream, and will be produced over a period of perhaps 20 years. A reasonable production rate over that time would be one million barrels per day - just 5% of today's 20 Mb/d consumption. Given that our rate of consumption is increasing by 4% to 5% each year, all the possible oil in ANWR would do nothing but help keep pace with demand growth. Helpful, but no panacea.

The deep-water Gulf of Mexico offers some possibilities for major oil finds. Such exploration and production is expensive, and once established runs the risk of shut-downs because of hurricane damage, as we know well after the season of 2005. Offshore California has potential, but stringent environmental regulations have reduced exploration there to virtually zero.

Can Montana help? Montana IS helping. Because many of their fields are small, old and largely tapped out, traditional oil-patch states are losing oil production at increasing rates. Texas' production fell by almost 7% between 2004 and 2005 while Louisiana lost not quite 2%; California declined by 2%, and New Mexico lost almost 5% of its production rate. At the same time, Montana, ranking #10 on the list of oil producing states, increased its production by more than 14%, to 88,000 barrels per day in June 2005. That volume is paltry compared to leaders like Louisiana, averaging 1,463,000 barrels per day in 2005, but the Montana rate of increase is dramatic. Compared to 2002, Montana's oil production has grown by a whopping 87%.

The growth in Montana production is also enjoyed by North Dakota, which shares the oil-rich Williston Basin with eastern Montana. A package of rock called the Bakken Formation, laid down around 360 million years ago, is the key to the new production. Averaging just 8 to 12 feet thick, the pay zone is exploited by a relatively new technique called horizontal drilling, which punches the drill along the length of a rock layer rather than straight through it. This exposes much more of the oil-bearing rock to the drill hole, allowing more oil to be extracted. Best estimates by many economists see no end in sight for this increase, and some optimistic folks suggest that Montana could be producing as much as 200,000 barrels per day within 5 years, jumping it to the Number 5 ranking among the states, after Louisiana, Texas, Alaska, and California. It could happen, but without major changes in consumption habits, oil price shocks are likely to be the rule rather than the exception.

Sources: Most statistics in this article are from the U.S. Energy Information Administration.

[reason]

Some interesting oil industry statistics - Page 4
Return to Main Oil Statistics Page
?2005 Gibson Consulting


Oil Refineries
The following information on active oil refineries comes from the Energy Information Administration. Total in the US is 149 refineries. For more specifics, such as refinery owner and capacity of individual refineries, go to This Page, click on a state, and then click on "petroleum overview" on the state page. The list is in order of total capacity in 2005. States not listed, such as New York, Florida, and Arizona, do not have any refineries. EIA Information on individual refineries.
Oil refining company quiz

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US total refining capacity = 17,125,000 barrels of oil per day. Of this, 19.5 gallons per barrel, or about 44% (the most that can be made) becomes gasoline: 7,535,000 barrels of gasoline, times 42 gallons per barrel = 316,470,000 gallons of gasoline capable of being refined each day. Although most refineries are operating at near capacity (say 95% to 98% of capacity), any shutdown (hurricane or otherwise) obviously affects this total. In March 2005, US gasoline consumption was 320,500,000 gallons per day. You do the math.
UPDATE: According to this EIA page, US gasoline consumption in 2004 averaged 382,400,000 gallons per day - meaning we must import almost 66 million gallons of gasoline each and every day, in addition to imported crude oil.

[reason]

http://energy.senate.gov/legislation...rts/chart8.pdf

[reason]

http://www.nytimes.com/imagepages/20...graphic-1.html

[reason]

Come to think of it, I think it's great the Republicans in the dying first ring suburbs killed yet another attempt at light rail.

Republicans are stupid, but the local ones are bottom of the barrel. Chabot and Schmidt anyone? Dumber than a box of rocks. Following in line with the dumbest of all - George Bush.

Obama is right: We cannot drill ourselves out of this problem. We should be thinking about something more than oil company profits.

<font color="#CC6600" size="1">[ June 21, 2008 11:36 AM: Message edited by: The Big Sexy ]</font>

[reason]

I'm cheating by using Wikipedia, but...

[edit] United States

United States oil reserves peaked sharply in 1970 after the supergiant Prudhoe Bay field was found in Alaska.
United States oil production also peaked in 1970. By 2005 imports were twice production.United States proven oil reserves declined to a little less than 21 billion barrels (3.3?109 m3) as of 2006 according to the Energy Information Administration, a 46% decline from the 39 billion barrels (6.2?109 m3) it had in 1970 when the huge Alaska North Slope (ANS) reserves were booked. With production of around 5 million barrels per day (790?103 m3/d) as of 2006, this represents about an 11 year supply of oil reserves at current rates of production.

If the United States had to supply its entire demand of 21 million barrels per day (3.3?106 m3/d) without resorting to foreign imports, existing US reserves would last only three years at the current rate of consumption.

No oil fields of similar size to the ANS reserves have been found in the US since 1970. With over 2.3 million wells having been drilled in the US since 1949,[44] there are very few unexplored areas left where a similar size oil field is likely to be found.[citation needed] US oil reserve numbers are very accurate compared to those of most other countries.

As a result of the decline in reserves, United States crude oil production also has been declining for nearly 30 years. Production peaked in 1970 at 9.6 million barrels per day (1.53?106 m3/d), but declined 47% to 5.1 million barrels per day (810?103 m3/d) by 2006. At the same time, US imports of oil and petroleum products increased by 400% from 3.4 million barrels per day (540?103 m3/d) in 1970 to 13.6 million barrels per day (2.16?106 m3/d) in 2006. The largest suppliers of oil and products in 2006 were Canada and Mexico, which supplied 2.3 and 1.7 Mbbl/d (370?103 and 270?103 m3/d), respectively.[45]

Imports of oil and products account for nearly half of the US trade deficit. As of 2007, the Energy Information Agency (EIA) of the US Department of Energy projected that in 2007 oil consumption would rise to 20.9 million barrels per day (3.32?106 m3/d), while oil production would fall to 5.1 million barrels per day (810?103 m3/d), meaning that oil consumption would be nearly four times as high as oil production.[46]

In April 2008, the United States Geological Survey (USGS) released a report giving a new resource assessment of the Bakken Formation underlying portions of Montana and North Dakota. The USGS believes that with new horizontal drilling technology there is somewhere between 3.0 and 4.5 billion barrels (480?106 and 720?106 m3) of recoverable oil remaining to be discovered in this 200,000 square miles (520,000 km?) formation that was initially discovered in 1951. If accurate, this reassessment would make it the largest continuous oil formation ever discovered in the U.S.[47] However, it would represent only a five to seven month supply of oil for the United States at current (2007) rates of consumption.

A 1993 United States Geological Survey (USGS) study indicated at least 4.3 billion (95% probability) and possibly as much as 11.8 billion (5% probability) barrels (0.9 to 2.5 km?) of technically recoverable oil exists in the Arctic National Wildlife Refuge 1002 area, with a mean value of 7.7 billion barrels (1.7 km?). In addition, in the entire assessment area, which covers not only land under Federal jurisdiction, but also Native lands and adjacent State waters within three miles (5 km), technically recoverable oil is estimated to be at least 5.7 billion (95%) and as much as 16.0 billion (5%) barrels (0.7 to 1.9 km?), with a mean value of 10.4 billion barrels (1.2 km?). Economically recoverable oil within the Federal lands assuming a market price of $40/barrel (constant 1996 dollars - the highest price included in the USGS study) is estimated to be between 3.4 billion (95%) and 10.4 billion (5%) barrels (0.5 to 1.7 km?), with a mean value of 6.8 billion barrels (1.1 km?).


[edit] Oil shale
Main article: Oil shale reserves
The United States has the largest known deposits of oil shale in the world, according to the Bureau of Land Management and holds an estimated 2,500 gigabarrels of potentially recoverable oil, enough to meet U.S. demand for oil at current rates for 110 years. However, oil shale does not actually contain oil, but a waxy oil precursor known as kerogen. For this reason and because there is not yet any significant commercial production of oil from oil shale in the United States as of 2008, its oil shale reserves do not meet the petroleum industry definition of proven oil reserves.

[reason]

In Summary, Republicans have jeopardized national security by promoting the "drill more" mentality. We have become more dependent on a limited resource controlled mostly by undemocratic nations. We use more of this limited resource even as our domestic supply diminishes.

Anyone who tells you that environmental wackos and Democrats are responsible for this mess are grossly ill-informed. The Republican party has compromised our national security with its lack of vision toward our energy needs. We will all pay dearly.

[Beachcomber]

The Arab oil embargo (1973 or 1974?) should have been a wake-up call. It wasn't. How many presidents have been in office since 1973?
Nixon, Ford, Carter, Reagan, Reagan, Bush, Clinton, Clinton, Bush, Bush. How many congresses have failed to legislate a solution? 35 years worth of failed policies and no policies at all. The onus falls on both parties, not just one. They are all trash, period.

<font color="#CC6600" size="1">[ June 24, 2008 07:34 AM: Message edited by: Beachcomber ]</font>