OPINION/COMMENTARY

We Are Not We Running Out of Oil

Every time oil prices rise for an extended period, the news media issue dire warnings that a crisis is upon us – it’s not! Many factors are contributing to the currently high gas prices: limited refining capacity, political restrictions on development of new domestic sources of oil, reduced supply from several oil exporting countries due to political conflicts, limited supplies due to the actions of the oil cartel, OPEC, and finally, increased demand for oil in China. Dwindling supplies of oil is not a factor in the current price at the pump. New technologies continually increase the amount of recoverable oil, and market prices — which signal scarcity — regularly encourage new exploration and development. The history of the petroleum industry is one of predictions of near term depletion, followed by the discovery of new oil fields and the development of technologies for recovering additional supplies. Before the first U.S. oil well was drilled in Pennsylvania in 1859, petroleum supplies were limited to crude oil that oozed to the surface. In 1855, an advertisement for Kier’s Rock Oil advised consumers to “hurry, before this wonderful product is depleted from Nature’s laboratory.” Indeed, seven oil shortage scares occurred before 1950....

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