A little long:
Little investment in deposits worsens oil shortageInvestments in exploration and production require oil prices at USD 100
CARACAS, Monday June 22, 2009--Economy
The International Energy Agency (IEA) cautioned against it. Low global oil prices are reducing world investments in exploration and production, which will restrict future oil supply.
Fernando Travieso, the advisor to the National Assembly (AN) Energy and Mines Committee, said that a price of USD 70 per barrel is not enough to make any investment. In order to undertake such projects, oil prices need to be above USD 100. Travieso added that notwithstanding oil prices in 2007 and the prices recorded at least by mid 2008, only one barrel was discovered for every five barrels used in the world.
The expert explained that Conoco shortened last year by USD 20 billion its investments in new prospecting and drilling projects. This was also the case for other major companies. "If no investment in exploration is made, companies will reduce their value. This will power the drop in oil reserves and cause troubles with oil supply in the future, which will worsen the current economic crisis," he said. –snip--
IEA: Crisis in 2013
For the IEA, the oil crisis will be noted in 2013, and this could lead to a tougher economic crisis. According to the agency, the reduced supply could unleash high oil prices as "ever seen before." --snip--
Travieso thinks that the Orinoco Oil Belt ensures the production of non-conventional – extra heavy crude oil because its reserves are already quantified and certified. This saves any further investments in exploration, which are expected to be completed in 2010, at the very latest.
According to the expert, the drop as a result of the natural depletion of reservoirs of conventional –light and medium- oil in the world is estimated at some four million barrels a year. That is, an annual average production of 76 million bpd could fall down to 72 million bpd of oil.
At the present time, 76 million out of 84 million bpd drilled are of conventional oil. The remainder is composed of non-conventional oil, extra heavy oil, deep-water oil, and oil from the Polar Circles. "In this scenario, surely enough, the future of the world lies in the Orinoco Oil Belt, where the return accounts for 20 percent and a barrel costs USD 2," he added.
Other experts anticipate a recovery of the world economy by 2010 and raising demand with lower supply.
According to the progress report of Petróleos de Venezuela (Pdvsa) for 2008, the reserves of light and medium oil have shrunk, as opposed to growing reserves of extra heavy crude oil by 50 percent. Translated by Conchita Delgado