Oil And The Numbers

The Oil Industry and their advocates in government are on a roll now that gasoline is over $4 a gallon. Drill in ANWAR, mine oil shale in the Rockies, drill on the Continental Shelf and the Gulf, and drill in National Parks is the theme call. Oil executives being asked about how to "solve" the oil crises propagandize by saying such things as "it takes $50 to $75 a barrel to produce a barrel of oil": what they aren't saying is that only some of the oil takes that amount to produce, whereas Saudi oil may only cost $.75 to $1.00 to produce a barrel of oil. Oil produced in the Gulf costs more to produce than oil produced on land--when compared to its maturity. Oil, when first developed, is usually under pressure and comes up on its own. Later it must be pumped, then when that doesn't produce other methods such as steam injection, water flooding etc. needs be done to the oil reservoir to coax the oil out of the rock. When it costs more to produce than the price of oil covers the oil well is capped and left till prices rise high enough to cover production costs. So, the Oil Executive may be speaking the truth--but not the whole truth of the matter.
The U.S. uses up more than 7 billion barrels of oil a year and population growth is about 1.25%; which means consumption grows 1.25%; or more if part of the population decides to buy Hummers or large SUVs such as they have until prices went through the roof. The U.S. imports at least 60% of its oil and that increases as population grows and U.S. oil depletes. U.S. oil peaked in 1973-4 and has been declining at an accelerated rate ever since. Some claim that we can "drill" ourselves into self-sufficiency--that is like sticking more straws into a milk shake--you may get more milk shake for a short period of time but the milk shake is depleted faster. Drilling doesn't create more oil, it just uses what we have faster. That is better for the oil companies but not for consumers.
Oil advocates state that off shore oil amounts to 10 billion barrels. They claim that amount will free the U.S. from foreign oil for a decade or more. Remember we use 7 billion barrels and more a year. It will take years to explore and produce that oil and production itself is limited by the viscosity of the oil, the size and shape of the oil reservoir, the engineering involved, the profit picture, and luck. There is no way that 10 billion barrels of oil would be enough to offset imports. We would need to find and produce 4 billion barrels of oil a year to be self sufficient. We would need to be able to increase discovery and production above 4 billion barrels a year to keep up with demand. We are far from that figure--oil discoveries and production is declining; not increasing. We have found most of the oil that is to be found--I mean economical oil. Oil that can be produced at a cost that we can afford.
Hydrogen is an example of a fuel that is abundant but not affordable. People can't make enough money to be able to afford high priced oil, or other fuels. Oil executives can slant their case to convince the uninformed for a time, and their friends in government can try to con the public and create loopholes but the truth will come out in time. The point I am trying to make is that we need to move on while we have the resources to do so. If we wait till oil is depleted it will be too late.