Oil Drilling in Alaska
If there is one subject in the oil arena that is massively misunderstood, it is oil drilling in Alaska. Should we or shouldn’t we drill in Alaska? The answer may surprise you.
10 Billion Barrels
Proponents of oil drilling in Alaska tell us there is 10 billion barrels just waiting to be tapped. That sounds like a ton of oil. In some ways it is, but mostly it is not. Let’s just assume there is a full 10 billion barrels and we can tap it all. How long would it last us? The answer is fairly scary.
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The United States uses just under 20 million barrels of oil a day. Let’s use 20 since my math skills are lacking. At this rate, we would use up 10 billion barrels in 500 days. That’s less than two years. Now we would obviously be using other sources as well, but you get the idea. As a matter of comparison, Saudi Arabia claims to have some 267 billion barrels of oil reserves.
Not So Fast
Ah, but is this 10 billion barrel number correct? A lengthy, indepth survey by the United States Geological Survey revealed something very surprising. The study found there is less than a billion barrels of oil in the claimed area. The remaining resource is not oil, but natural gas. In short, drill baby might be a good slogan for the natural gas industry trying to get into Alaska, but it isn’t for oil.
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4 Saudi Arabias
The simple fact of the matter is we have now peaked in oil production and are facing supply problems in the near future. This does not mean we are running out of oil, only that demand will outstrip supply and prices will go through the roof. This will continue to be a problem according the International Energy Association that reviews oil reserves because it believes that we will need to replace the equivalent oil production of 4 Saudi Arabias in the next 20 years. Frankly, that is impossible.
Will oil drilling in Alaska save us from higher oil and gasoline prices? Nope, not a chance.
