Oil Shock: No Shortage for 100 Years–UPDATE

At $20 a barrel, there’s a major world oil shortage. At $50 a barrel, there’s enough oil to last well into the next century, regardless of increasing usage. Therefore, the ability of oil to sustain a price much above that level for very long is fictional. This is why Venezuelan president Hugo Chavez intends to ask OPEC to set a minimum price for oil of $50 a barrel. Venezuela’s deposits of extra heavy oil in the Orinoco are the reason. Until recently, the have not been counted among the world’s oil reserves because they were too expensive to exploit. But at $50 a barrel, refining them and selling them is a profitable enterprise. The reserves are truly massive. In fact, the U.S. Department of Energy believes that they exceed the reserves of the whole Middle East. Including this oil, Venezuela therefore controls 1.3 trillion barrels, more than all of the rest of earth’s reserves put together. Chavez sees an end to the Iraqi war, which is what has driven oil prices from the pre-Bush $20 a barrel level up to the current $50-$60 price range. Like most of the oil patch, he knows that his own reserves will cause the price of more readily available oil to drop back to the $20-$30 range as soon as the Iraqi situation corrects itself. And the gigantic Venezuelan reserves will be there for the 22nd century and beyond to exploit. Assuming the world even uses oil as a fuel by that time. Our real crisis is not an oil crisis at all, it’s an emissions crisis. We’ve got more oil than we need, and will have for at least another one to two hundred years. But what happens to the air when we burn it–that’s the danger that we must confront.

UPDATE: Author James Howard Kunstler, whom Whitley interviewed for his new book The Long Emergency, has this comment: “This is not to be taken seriously. Venezuela oil sands will not be developed. The terrain is unconquerable.” You can still hear Whitley’s conversation with William about our future if you subscribe today. At only $11.95 for 3 months, how can you afford not to?

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