The Current and Future Global Energy Situation
British Petroleum (BP) has published the ”BP Statistical Review of World Energy” since 1951. The latest report describes the distribution and consumption of natural resources. In 2002 the world energy consumption was distributed like this: 36% oil, 23% coal, 20% gas, 11% biomass, 7% nuclear, 2% hydrogen og 1% sun/wind/geothermal.
Looking at the geographical distribution of these natural resources we find that the Middle East is the most oil rich region with 650 billion barrels. The rest of the world starts at 96 billion barrels located in Latin and South America and ends with 19 billion barrels in Europe. Known gas reserves is equal in the former Soviet Union and and the Middle East at 55 trillion cubic meter. Known coal reserves is predominantly located in Asia (290 billion tons), with North America and the former Soviet Union as a close second and third. The Middle East has insignificant amounts of coal.
Looking at the geographic distribution of the consumption of these scarce natural resources we find that the U.S. consumed 40% of the total oil production in 1998. From 1999 to 2000 the import of oil and petrouleum increased with 65%. Comparing consumption with oil production in the U.S., standing at 18% of the world total, we understand why 1/3 of the U.S. trade deficit is caused by imported oil.
China being the worlds most populous country with the fastest growing economy, expecting a 7% GNP growth compared to meager 2% in the west. China is the second largest total energy consumer, being numer three in oil specifically. China use predominantly coal for power generation. The pollution in some Chinese provinces is of such magnitudes that they enter the atmospheric system and travel across the Pacific Ocean to cause environmental harm in the U.S.
Petroleum and reservoar engineers has feared a world peak of oil in the early 21th Century since the 50’s. Reservoar engineers use the term ”Estimated Ultimately Recoverable” (”EUR”) to indicate the absolute amount of oil in each well. A ”peak” is the point where the ”EUR” reach the total production volume, subsequently leading to future decline in production. A ”peak” is also the point where the number of new discoveries of reservoars decline compard to expected production growth. The total consumption of petroleum is more than 65 millions pr. day. Based on historic energy consumption, future trajectories point to 100 million barrels pr. day in 2015. New resorvoars is detected at a slower rate than the expected growth in consumption. This has caused a decline in the expected lifetime of known reserves and is now expected to be 40 years.
The most powerful nation in the world, the U.S., is dependent on imported oil from the Middle East. China, the fastes growing nation in the world depend on the most polluting fossile fuel, coal. To add extra suspense to this situation, the world will probably reach peak production of both oil and gas within the next 10 to 20 years. U.S. oil production peaked in the early 70’s as predicted by M. King Hubbert (famous for his Hubbert’s Peak), European oil production will peak soon or has already peaked. The western world is slowing entering a period of dramatic decline in production and further depence on the Middle East.