[Ok-sus] The next great oil crisis

Bob Waldrop bwaldrop1952 at att.net
Sat Sep 8 20:52:54 CDT 2012


Below is a snip of the article.  Much more at the link, including an 
interesting info graphic on oil.

Bob Waldrop, OKC

The Next Great Oil Crisis
http://www.miamiherald.com/2012/08/11/2946593/the-next-great-oil-crisis.html


    Technology is making it possible to tap vast new oil supplies. But
    that could be the proverbial drop in the gas tank compared to rising
    demand overseas.

By Greg Gordon


      McClatchy News Service

WASHINGTON -- After nearly a decade of warnings that the world's oil 
supply was running out, Americans now are hearing about technology 
breakthroughs that can unlock vast U.S. deposits of natural gas, help 
reverse a 40-year slide in domestic oil production and perhaps transform 
America into the next Middle East.

Despite the euphoria, there's a major problem: The looming American oil 
glut may simply not be enough to sate the United States and the rest of 
motorized humanity.

Experts say soaring demand from China and India is sure to send oil 
prices back above $100 a barrel. A supply disruption in the coming 
years, they say, could trigger panic, gasoline hoarding and perhaps lead 
to lines at the pumps akin to the 1973 Arab oil embargo and the 1979 
Iranian revolution.

Global shortfalls of other fuels also could develop sooner than many 
people think, as a planet of nearly seven billion people and more than 
one billion gasoline-gulping vehicles strains the limits of combustible 
energy resources that are the underpinning of modern civilization.

While oil industry officials take strong issue with these dim views, 
critics charge that governments here and abroad have been less than 
candid about future oil supplies and the ramifications of failing to 
shift to alternative fuels.

One outspoken Energy Department consultant, Robert Hirsch, alleged that 
the administrations of both Presidents George W. Bush and Barack Obama 
have engaged in a cover-up of the likelihood of an oil shortage. Hirsch 
predicted a shortfall will hit in the next four years and send 
shockwaves through the world economy, possibly leading to gasoline 
rationing. Few governments have implemented intensive conservation 
programs to stretch out supplies during a decades-long transition to 
more fuel-efficient vehicles.

Instead, critics say that even as oil prices nearly quadrupled from 2003 
through 2011, government and industry leaders have played down the 
world's worsening energy predicament.

For example:

. While U.S. industry officials have trumpeted new drilling techniques 
that can recover huge deposits of previously unreachable oil and natural 
gas, most say little about the likelihood of surging Third World demand 
overtaking supplies, causing shortages and skyrocketing prices.

. Industry watchdogs say that some U.S. Energy Information 
Administration forecasts have been wildly optimistic, especially a 
projection that between 2011 and 2035, global production of liquid fuels 
will see a 21.6 million-barrel rise in daily output --- the equivalent 
of the current reserves of the five biggest Middle East oil producers.

. Other projections and policies by the Energy Information 
Administration, which is the Energy Department's independent information 
arm, as well as the Paris-based International Energy Agency and even the 
U.S. Securities and Exchange Commission, have masked mounting risks of 
shortages of oil and possibly natural gas, several experts say. A 
McClatchy computer analysis suggests that proven reserves of all of the 
world's primary fuels are likely to diminish much faster than the EIA 
and the IEA have suggested, raising questions about how long mankind can 
continue to increase consumption of finite resources.

Researchers at the International Monetary Fund, while not yet speaking 
for the fund, predicted in May that rising oil demand would drive prices 
to nearly $200 a barrel, "permanently," within a decade. Commodities 
speculators could exacerbate a price surge if they echo their behavior 
in recent oil spikes.


Read more here: 
http://www.miamiherald.com/2012/08/11/2946593/the-next-great-oil-crisis.html#storylink=cpy
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