Oil Reserves

A report by BP on the 2015 Statistical Review of World Energy indicated that proven oil reserves in the past decade rose by 334 billion barrels to a global total of 1.7 trillion barrels. The reserve estimate does not reflect only new discoveries and in fact will be downsized in the final 2015 reporting. “An oil resource describes the total amount of oil in place in a formation, a country or even the world.” The amount of the resource that is technically and economically recoverable typically averages 10%. “Economically recoverable at prevailing oil prices may be classified as proved oil reserves,” and that definition accounts for the expected downsizing of the world reserves estimates. For exampleVenezuela’s enormous heavy oil resource was estimated higher than Saudi Arabia resources in 2014, but with the low price of oil and the high cost to produce heavy oil, Venezuela 65% of the world reserve estimates has been wiped out.