Production of crude oil as a percentage of proved reserves: Recent worldwide and US trends
24 January 2022
by Michael Sivak, Sivak Applied Research.
In this analysis, I examined the relation between crude-oil production and crude-oil reserves in the world overall and in the United States alone. 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 1980 through 2020 (in five-year increments through 2015, and then every year). This analysis is an update of the analysis that examined the situation through 2017.
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). (Several of those values were recently revised.) The results are shown in the table below.
|Reserves (billion barrels)||Production (billion barrels)||Production as % of reserves||Reserves (billion barrels)||Production (billion barrels)||Production as % of reserves|
Let’s first consider the recent changes in the two underlying variables. From 1980 to 2020, proved reserves of crude oil increased by 158% in the world, compared with an increase of 51% in the United States. Analogously, during the same period, production of crude oil increased by 28% in the world, compared with an increase of 31% in the United States. However, production in 2020 (the first year of the pandemic) decreased by 7% compared with 2019 both in the world and 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 1980 represented 3.4% of proved crude-oil reserves. The corresponding percentage in 2020 was down to 1.7%, which was the minimum for the examined years. For the United States, production of crude oil in 1980 represented 10.1% of proved crude-oil reserves. The corresponding percentage in 2020 was down to 8.8%.
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 2020, the corresponding percentages were 8.8% and 1.7%, respectively.
Between 1980 and 2020, production of crude oil as a percentage of proved reserves of crude oil decreased for both the United States (from 10.1% to 8.8%) and the world (from 3.4% to 1.7%).
Michael Sivak is the managing director of Sivak Applied Research and the former director of Sustainable Worldwide Transportation at the University of Michigan.
Very interesting analysis. Clearly "proved reserves" are a function of how much investment is needed to make them. "Proved reserves" are an economic construct not a geological one.
Posted by: msevior | 24 January 2022 at 04:16 PM
The reserves jumped up once we got fracking
Posted by: SJC | 24 January 2022 at 06:22 PM