| HappySqurriel said: Most easy to access conventional crude is already being used so further production comes at a massive expense and several years of development. From what I hear (and I live in oil-town), the falling price of oil is not the primary reason why oil companies are cutting back or development (after all, many still expect $100+ oil next year). The oil companies fear windfall energy taxes and carbon taxes and are not willing to spend Billions in development for such little gain; after all, they can make far more profit if they don’t develop the resources and let oil skyrocket to $500 a barrel. |
According to the article, even if investments were made the drop rate would only be 3% lower.
The problem with oil is that there are a number of large oil fields which, when declining, are very hard to replace. Unconventional oil or smaller conventional oil fields just can't keep up with the necessary flow rates.
A lot of the media keeps saying "oh don't worry, there's still a lot of oil on the ground". That's true, reserve numbers are still big. The flow rates aren't though, and as far as I know I can't fuel a car with buried oil. I can't even imagine what the oil price would be right now if it weren't for the economic crisis
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