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Earth May Have More Oil Than Previously Thought…

…The problem is more a matter of what it will take for us to access it. According to a new report by the Energy Information Administration, previous US government projections underestimated global oil reserves by as much as 10 percent:

“…estimates in the updated reporttaken in conjunction with EIA’s own assessment of
resources within theUnited States indicate technically recoverable resources of 345 billion barrels of
world shale oil resources and 7,299 trillion cubic feet of world shale ga sresources. The new global shale
gas resource estimate is 10 percent higher than the estimate in the 2011 report…
…Although the shale resource estimates presented in this report will likely change overtime as additional
information becomes available, it is evident that shale resources that were until recently not included in
technically recoverable resources constitute a substantial share of overall global technically recoverable
oil and natural gas resources. The shale oil resources assessed in this report, combined with EIA’s prior
estimate of U.S. tight oil resources that are predominantly in shales, add approximately 11 percent to
the 3,012 billion barrels of proved and unproved technically recoverable nonshale oil resources
identified in recent assessments.”

Trouble is, simply having more oil on the planet does little to alleviate pricing concerns in the short term. As MSN Money observes:

“…Oil sands just beneath Edmonton in Canada’s Alberta province hold an estimated 175 billion barrels, making it the third-largest oil reserve in the world. But it’s going to spend much of the near future untapped.

The problem is that even extraction methods like fracking are in their crudest stages and don’t come close to being adequate for most oil sand extraction. The oil in those shales isn’t easy to separate from the sand and water surrounding it and leaves huge waste pools in its wake. That mess costs money, and it’s only going to get messier as those oil numbers surge.”

Unfortunately for consumers, the peak oil problem ultimately still poses a number of challenges – particularly as long term trends in third-world development continue to drive demand higher. It is a troubling thought indeed that even today’s high prices may seem like a bargain in comparison to the not-so-distant future.

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