crude oil

The year 2008 has witnessed unprecedented fluctuations in the oil prices. During the first three-quarters, the oil price abruptly increased to $140/bbl, a level that has never been reached before; then because of the global economic crisis, the price dramatically plunged to less than $50/bbl by the end of the year losing more than 64% of the maximum price in less than three months period. The supply of crude oil to the international market oscillated to follow suite according to the law of supply and demand. This behavior affected oil production in all exporting countries. Nonetheless, the demand for crude oil in some developing countries, such as China and India, has increased in the past few years because of the rapid growth in the transportation sector in addition to the absence of viable economic alternatives for fossil fuel. The rapid growth in fuel demand has forced the policy makers worldwide to include uninterrupted crude oil supply as a vital priority in their economic and strategic planning.

Even though forecasting should be handled with extreme caution, it is always desirable to look ahead as far as possible to make an intellectual judgment on the future supplies of crude oil. Over the years, accurate prediction of oil production was confronted by fluctuating ecological, economical, and political factors, which imposed many restrictions on its exploration, transportation, and supply and demand. The objective of this study is to develop a forecasting model to predict world crude oil supply with better accuracy than the existing models. Even though our approach originates from Hubbert model, it overcomes the limitations and restrictions associated with the original Hubbert model. As opposed to Hubbert single-cycle model, our model has more than one cycle depending on the historical oil production trend and known oil reserves. The presented method is a viable tool to predict the peak oil production rate and time. The model is simple, accurate, and totally data driven, which allows a continuous updating once new data are available. The analysis of 47 major oil producing countries estimates the world’s ultimate crude oil reserve by 2140 BSTB and the remaining recoverable oil by 1161 BSTB. The world production is estimated to peak in 2014 at a rate of 79 MMSTB/D. OPEC has remaining reserve of 909 BSTB, which is about 78% of the world reserves. OPEC production is expected to peak in 2026 at a rate of 53 MMSTB/D. On the basis of 2005 world crude oil production and current recovery techniques, the world oil reserves are being depleted at an annual rate of 2.1%.

Published in: Energy & Fuels, Volume 24, Issue 3, February 2010, Pages 1788–1800
Available from: ACS publications

The well known "Hubbert curve" assumes that the production curve of a crude oil in a free market economy is "bell shaped" and symmetric. The model was first applied in the 1950s as a way of forecasting the production of crude oil in the US lower 48 states. Today, variants of the model are often used for describing the worldwide production of crude oil, which is supposed to reach a global production peak ("peak oil") and to decline afterwards. The model has also been shown to be generally valid for mineral resources other than crude oil and also for slowly renewable biological resources such as whales. Despite its widespread use, Hubbert's modelis sometimes criticized for being arbitrary and its underlying assumptions are rarely examined. In the present work, we use a simple model to generate the bell shaped curve curve using the smallest possible number of assumptions, taking also into account the "Energy Return to Energy Invested" (EROI or EROEI) parameter. We show that this model can reproduce several historical cases, even for resources other than crude oil, and provide a useful tool for understanding the general mechanisms of resource exploitation and the future of energy production in the world's economy.

Published in: Energies, Volume 2, Issue 3, September 2009, Pages 646-661
Available from: Energies

A review is given of the nature and origins of crude oil (petroleum) along with factors relating to its production and demand for it. The modern globalised world economy and its population has grown on the assumption of limitless supplies of cheap crude oil. Almost all agriculture now is completely dependent on available oil and natural gas to run machinery and to make chemical fertilizers. Our complacent regard for oil is however invalid and a gap between the relentlessly rising demand for oil and its supply is expected to appear at some time in the period 2010 - 2015. The global peak in oil production "peak oil" predicted by M. King Hubbert in 1956, will exacerbate the situation, and the world must seek to run and organise itself in an imminent reality where supplies of conventional crude oil are both limited and increasingly expensive. Providing the equivalent of 30 billion barrels of oil a year as is currently used across the globe, by unconventional kinds of oil, e.g. from oil shale and tar sands is not realistic. Since most of the oil produced in the world is refined into liquid fuels to run transportation, human survival will depend on devising localised economies and communities that necessarily rely far less on personalised transport (cars).

Published in: Science Progress, Volume 91, Number 4, December 2008 , Pages 317-375
Available from: IngentaConnect