by Michael Sivak.
In this analysis, I examined the relation between crude-oil production and crude-oil reserves in the world and in the United States. The variable of interest was the amount of crude oil produced as a percentage of proved reserves of crude oil. (This variable is inversely related to the reserves-to-production ratio.) The years examined were 1987 through 2017 (in five-year increments).
The raw data for this study were proved reserves of crude oil (obtained from Oak Ridge National Laboratory), and annual crude-oil production (calculated from the information in the same source).
The results are shown in the table below.
Let’s first consider the recent changes in the two underlying variables. From 1987 to 2017, proved reserves of crude oil increased by 136% in the world, compared with an increase of 24% in the United States. Analogously, during the same period, production of crude oil increased by 43% in the world, compared with an increase of 12% in the United States.
The main findings concerning the issue of primary interest—production of crude oil as a percentage of proved reserves—were as follows. For the world, production of crude oil in 1987 represented 3.0% of proved crude-oil reserves. The corresponding percentage in 2017 was down to 1.8%, which was the minimum for the examined years. For the United States, production of crude oil in 1987 represented 10.8% of proved crude-oil reserves. The corresponding percentage in 2017 was down to 9.7%. The minimum for the examined years—8.2%—was reached in 2012.
Production of crude oil as a percentage of proved reserves of crude oil was substantially greater for the United States than for the world for each year examined. For 2017, the corresponding percentages were 9.7% and 1.8%, respectively.
Between 1987 and 2017, production of crude oil as a percentage of proved reserves of crude oil decreased for both the United States (from 10.8% to 9.7%) and the world (from 3.0% to 1.8%).
Michael Sivak is the managing director of Sivak Applied Research and the former director of Sustainable Worldwide Transportation at the University of Michigan.