Limitations of Oil Production to the IPCC Scenarios: The New Realities of US and Global Oil Production
James W. Murray ()
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James W. Murray: University of Washington
Biophysical Economics and Resource Quality, 2016, vol. 1, issue 2, 1-13
Abstract Many of the Intergovernmental Panel on Climate Change’s Special Report for Emission Scenarios and Representative Concentration Pathways (RCP) projections (especially RCP 8.5 and 6) project CO2 emissions due to oil consumption from now to 2100 to be in the range of 32–57 Gb/yr (87–156 mb/d) or (195–349 EJ/yr). World oil production (crude plus condensate) was almost constant from 2002 to 2011 at about 74 ± 1 million barrels per day (mb/d) (US Energy Institute Agency, US EIA). There was an increase in world oil production after January 2011 that was mostly due to a surge of about 6 mb/d in light tight oil (LTO) production in the USA. This increased global oil production to just above 80 mb/d. Meanwhile, production in the rest of the world remained constant. The surge in the USA resulted in a sustained situation where supply was greater than demand globally, and this initiated a crash in the price of oil. The price of oil decreased from about $100 per barrel in mid-2014 to less than $30 per barrel in early 2016. Once the oil price declined, it was further enhanced and sustained by a decrease in demand due to a slowdown in the global economy. Because LTO is expensive to produce and was unprofitable after the price crash for the exploration and production companies, the surge in US production ended in about April 2015. Now, production of LTO in the USA is declining and global oil production is as well. New oil discoveries have reached a 70-year low, which does not bode well for future production. If the present patterns persist, it is unlikely that world oil production will exceed present US EIA oil production values of about 27–29 Gb/yr (equivalent to 75–80 mb/d) or (171–182 EJ/yr). It is unlikely that the demand for oil production required for CO2 emissions in RCP8.5 and RCP6 will be met.
Keywords: Oil production; Light tight oil; IPCC; RCP; SRES (search for similar items in EconPapers)
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