The new era of fossil fuels

Advanced technologies are opening up new sources of oil and gas all over the world

by Mark J. Perry

Thanks to revolutionary, breakthrough drilling technologies, we have entered a new era of fossil fuels according to this article in The Pacific Standard, and the energy revolution is reshaping global economics and politics—and the planet:

In 1922, a federal commission predicted that “production of oil cannot long maintain its present rate.” In 1977, President Jimmy Carter declared that world oil production would peak by 1985.

It turns out, though, that the problem has never been exactly about supply; it’s always been about our ability to profitably tap that supply. We human beings have consumed, over our entire history, about a trillion barrels of oil. The U.S. Geological Survey estimates there is still seven to eight times that much left in the ground. The oil that’s left is just more difficult, and therefore more expensive, to get to. But that sets the invisible hand of the market into motion. Every time known reserves start looking tight, the price goes up, which incentivizes investment in research and development, which yields more sophisticated technologies, which unearth new supplies—often in places we’d scarcely even thought to look before.

One thing we do know: there are plenty of fossil fuels left. And sooner or later we’ll get to them. Human beings are not going to stop driving or using plastic. The mushrooming middle classes in China, India, and elsewhere want their cars and air conditioners, too. Petroleum consumption in China alone has doubled in the past decade, making it the world’s second largest consumer behind the U.S. In the next 20 years, barring unforeseen economic calamity, world energy demand is expected to increase by anywhere from a third to a half—and most of the increase will be met with oil and natural gas. Wind, solar, and other renewable sources have miles to go before they make up a major part of the world’s energy mix, and they are having a harder time than ever competing now that natural gas is dirt cheap.