Norwegian oil consulting agency Rystad Energy released an independent report Monday showing that the U.S. is the world leader in untapped, but recoverable oil reserves, beating out Russia, Saudi Arabia and Venezuela.
In total, Rystad found the U.S. is sitting on approximately 264 billion barrels of oil, over 50 percent of which is contained in shale rock formations extracted through the process of hydraulic fracturing.
The report’s findings come as somewhat of a surprise, as other estimates, such as the U.S. Energy Information Administration’s November 2015 analysis, have shown Venezuela to be the globe’s top oil reserve nation. According to Rystad, U.S. Energy’s number of 298 billion barrels for the South American country overestimates reserves in yet to be discovered oil fields, “based on official reporting from national authorities, reporting reserves based on a diverse and opaque set of standards.”
Rystad shows Venezuela trailing not only the U.S., Russia and Saudi Arabia, but also Canada, Iran, Iraq and Brazil for oil in “existing fields, discoveries and yet discovered fields”, with reserves totaling only 95 billion, only 35 billion more than the state of Texas alone.
“There is little potential for future [oil discovery] surprises in many other countries, but in the U.S. there is,” said Rystad analyst, Per Magnus Nysveen. “Three years ago the U.S. was behind Russia, Canada and Saudi Arabia.”
One caveat is the type of reserves prevalent in the U.S. and Canada, mainly shale, are more expensive to extract oil from than the traditional sources that are abundant in the Middle East by about $30 per barrel.
More significantly from a global perspective, the report also estimated world reserves totaling just over 2 trillion barrels, only enough to last 70 more years given the current production rate.
Through 2015, 1.3 trillion barrels of oil have produced all-time throughout the world.
“This data confirms that there is a relatively limited amount of recoverable oil left on the planet,” the report concludes. “With the global car-park possibly doubling from 1 billion to 2 billion cars over the next 30 years, it becomes very clear that oil alone cannot satisfy the growing need for individual transport.”
[OilPrice.com] [Financial Times via CNBC]