California Conservative

That’s the main message from this Newsweek article. I’ve never bought into the environmental extremists’ claims of just how much oil is left under the earth’s surface. Here’s a key section in Newsweek’s article:

How much oil lies beneath the Earth’s crust? The only thing we know for sure is that history is littered with estimates so far off the mark, usually below the mark, that they border on the comical. In the 1920s, for instance, the Anglo-Persian Oil Co. (now BP) refused to take a stake in Saudi Arabia, thinking that the country didn’t hold a single drop of oil. In 1919, the U.S. Geological Survey predicted that the United States would run out of oil in nine years. Yet by the time nine years had passed, huge discoveries, topped by the Black Giant field in Texas, had created a massive oil glut that almost destroyed the industry. In the 1970s, the consensus turned grim again: oil production would peak in the mid-1980s and then drop precipitously. A famous CIA report predicted the “rapid exhaustion” of accessible fields, while President Jimmy Carter warned that oil wells were “drying up all over the world.” Instead, in 1986, oil prices collapsed in the midst of a huge supply boom, as they had done many times before.

I’m willing to give the early oil drillers the benefit of the doubt because they didn’t have the technology to accurately predict what lied beneath the earth. I’m totally unwilling to give today’s naysayers that same benefit. Instead, I’ll rip the environmental extremists for lying through their teeth about the supply of oil.

I remember how the extremists predicted that the Alaskan Pipeline would destroy the caribou herds for a few measly years of crude oil. Thirty years later, they’re still pumping it out of Prudhoe Bay from along Alaska’s North Slope, with no end in sight.

I remember how people predicted the end of oil supply in Saudi Arabia, telling us that the oil was still there but that the oil couldn’t be extracted because it was too deep under the earth’s surface to be able to pump it all the way to the surface. Reagan told the innovators to innovate, which they did. The result was that the oil that was deemed too far beneath the earth’s surface to be extracted was soon extracted. They’re still getting oil from those wells a quarter century later.

Now doomsday forecasts are back, predicting the end of oil in this decade or the next. The verdict of the new catastrophists may appear more convincing because they use statistical and probability models that appear to penetrate the mysteries of our planet’s subsoil. In fact, they do no such thing. In sum, what little is known about the world’s underground resources justifies a positive view of the future.

Based on their history of predictions, why on God’s green earth should we listen to these extremists? I mean, seriously. There isn’t a justification for trusting them. The only conclusions we can arrive at is that they’re either woefully inept in their predictions or they’re simply lying through their teeth. I tend towards the latter rather than the former because, although they are liberal extremists without a lick of common sense, the truth is that they aren’t that stupid.

Given our fundamental ignorance of what lies below, the best bet is that the oil market will remain cyclical, characterized by boom-and-bust periods, for decades. We are in a period of high prices similar to the ’70s, yet there are critical differences. Today more than 90 percent of oil reserves are under the control of producing countries, many embracing a policy of resource nationalism. Aimed at sustaining prices, this nationalist tendency could choke off new development. It could also raise the already growing tension we see between producing and consuming nations, pitting the West against Russia, the United States against Venezuela and so on. Put simply, the oil problem is not beneath the surface but above it.

Who would’ve thought that this type of reporting would be found in Newsweek? To their credit, they willingly approved this article. To his credit, Leonardo Maugeri wrote this article based on facts and logical conclusions rather than on the environmental extremists’ talking points. We should thank Mr. Maugeri for his diligence and his painstaking accuracy.

The reason we have seen so many bad guesstimates is that even the most advanced technology can’t tell us how much crude the Earth holds. No method has been devised to search for new reserves with precision, or even to gauge the true size of known reservoirs. While the mainstream view is that oil resources are finite, no one knows just how finite they are. And to complicate matters further, we are witnessing a minor revival of interest in an old Russian theory that oil can be born of chemical reactions in deep inner Earth, not of fossils decaying closer to the surface. This holds the dim but intriguing prospect that oil might be a renewable resource. (See the interview with Nobel laureate Dudley Herschbach for a critique.)

I strongly recommend that everyone follows the link above to the article and reads it for themselves. I suspect that there will be alot of heads turned by the article’s logic and the honesty in Mr. Maugeri’s reporting.

Technorati Tags: Oil Reserves,Environmental Extremists, Alaskan Pipeline, Saudi Arabia, Oil Crisis

Cross-posted at LetFreedomRingBlog

This entry was posted on Wednesday, December 27th, 2006 at 1:45 am and is filed under Author: Gary Gross, Economy, Environment, Liberals, Middle East, Subversives, Technology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.