Filling it Up

dms dmschanoes at
Mon Jul 14 20:33:34 MDT 2003

As report in the WSJ 9 July:

British Petroleum's Annual Statistical Review increased estimates of Russian
crude reserves by 23% to 60 billion barrels.

This after Russian daily production in 2002 climbed 9.1 percent to 7.7
million barrels per day, putting Russia at second, tied with the US behind
Saudi Arabia, on the list of world producers.

How can increased reserves be the result, or coincident, with increased
production--- in a word, profit.

"Oil that was not economic in 1995 is economic today because of betters
costs, management, and technology," says Peter Davies, vice president and
chief economist for British Petroleum.

And when overproduction forces the price of oil down again, and the oil
companies in their gloom curtail investment and lower estimates of proven
reserves, and the Hubbertists step forward to say, "It's the end of the
world as we know it,"  just tell them to sit down and take a stress pill,
while we karaoke to the Four Tops, "It's the Same Old Song."


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