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Oil Reserves: Where Ghawar goes, the rest of OPEC follows
Phil Hart, The Oil Drum: Auatralia/New Zealand
In May 2007, the work of Stuart Staniford and Euan Mearns culminated in a new and unprecedented assessment of oil reserves in Ghawar, the world's largest oil field. This article (also written in May 2007 and well overdue for TOD posting) combines their assessment with additional information sources, to produce a revised estimate of reserves in Saudi Arabia and the other OPEC countries.

Oil Reserves in Saudi Arabia

In their 1986 study “Giant Oil and Gas Fields”, Carmalt and St John (American Association of Petroleum Geologists2) published a list of the largest five hundred oil and gas fields known at the time. This included field size estimates for 24 major fields in Saudi Arabia (crude oil and condensate).

... [Conclusion]

Claimed OPEC reserves are overstated by approximately 340 Gb. They are, with a high degree of certainty, rather much closer to 570 billion barrels than the 904 claimed. Combining this with the Oil and Gas Journal's non-OPEC conventional oil reserves estimate of 280 Gb9, yields a global reserves base of 846 billion barrels, well short of the 1140 level assumed.

The implications of this circa 340 billion barrel reserves shortfall for global forecasts of petroleum supply cannot be overstated. With cumulative consumption at 1180 Gb10 and reserves of less than 850 Gb, we have consumed well over half our conventional oil reserves base.

With those kinds of numbers, peak oil cannot be far away, and exploration and 'reserves growth' will not be enough to get us out of the woods.
(27 May 2008)
In a comment, Khebab writes:
Very good paper. Different orthogonal methodologies lead to reserves in the 140 - 175 Gb range for Saudi Arabia.

Oil Price "Head Fake"?
Jeff Vail, website
... Unless some new miracle technology (or miracle cohesive political will) moves us consciously away from oil, or unless the global economy collapses for reasons other than energy, then over the long-run these substitutes or this demand reduction will be a result of prices rising to significantly higher than they are now. The questions, to me, is whether this price rise will be relatively smooth or whether it will come in waves with serious retracements.

In other words, will oil prices make a "head fake," and decline significantly for a few years as current high prices cause a global recession, only to prevent us from mitigating the near-term onset of production declines causing truly dramatic price increases 5-10 years down the road? Charles Hugh Smith seems to think so.

... One think does seem certain--if we accept the assumption that oil prices will rise over the long-term, then a steady rate of increase with minimal volatility will best facilitate adaptation to a lower-energy, costlier-energy world. The "head fake" that Smith writes about is potentially very dangerous because it could cast new doubts over the very notion of Peak Oil at exactly the time when the world must address the problem with great urgency. A "head fake" would breathe new life into the abiotic oil crowd, the "markets will always provide" crowd, the Super-Hummer crowd, etc. Because I think that there is a significant possibility of a "head fake" due to market psychology (or, possibly, due to a short-term increase in supplies if the megaproject and geopolitics stars all align over the next 24 months or so), I think that our outlook and investing in the energy sector needs to incorporate a fairly long-term time horizon. I don't think that $200 oil is a sure thing this year or next (though I think it's a strong possibility). But oil under $200/barrel in 2016 seems highly, highly unlikely absent a general economic collapse (and, in that even, we have equally big problems to deal with).
(26 May 2008)

Has Russian oil output peaked?
Fred Weir, Christian Science Monitor
The Kremlin often touts Russia's image as an "energy superpower," but now the country's oil production is declining. Some say Russia may have already reached peak oil output.

Underscoring the urgency of the issue, Prime Minister Vladimir Putin's new cabinet made its first order of business on Monday the approval of a package of measures to relieve the oil-production crisis.

"It's a good first step," says Natalia Milchakova, an oil and gas analyst for Otkritiye, a Moscow-based brokerage firm. But she adds that "rapidly slowing" oil production, which was growing by more than 10 percent five years ago, isn't "something that can be quickly fixed with political declarations."

As the world's second-largest oil exporter, Russia joins a growing number of top oil suppliers wrestling with how to address declining or peaking production. Like Venezuela and Mexico, Russia is heavily dependent on oil, which accounts for more than two-thirds of government revenue and 30 percent of the country's gross domestic product. Now, Moscow is trying to remedy a situation caused in part by outdated technology, heavy taxation of oil profits, and lack of investment in oil infrastructure.
(27 May 2008)