In the shank of the 1970s, during that decade's second energy crisis, all sorts of doomsayers were predicting a world without oil. Within the foreseeable future, they said, the last barrel of dinosaur era crude would be pumped out of a dried-up planet. Advocates of solar, wind, and geothermal power were telling reporters they were ready to take up the slack. Coal slurry pipelines, nuclear plants, and hydro power were hot topics.
Flash forward to the late 1980s. The world is still blithely burning oil. The day the planet runs dry has been pushed well into the next century. The solar, wind, hydro, and geothermal lobbies have dwindled. Nuclear and coal advocates attract little coverage.
What happened is easy to understand: Prices rose, demand decreased, new oil was found. The volume of ``proven reserves'' has been rising throughout the 1980s. Last year alone oil producers added almost 30 percent to estimates of oil in the ground that they feel can be economically extracted at today's decidedly modest prices.
``Only a fool would doubt that there's enough oil to last beyond the 1990s,'' says John Lichtblau of the Petroleum Industry Research Foundation in New York.
But, Mr. Lichtblau and other industry analysts warn, don't think that the old worry about energy security is unfounded because there is oil galore. It is not so much the level of oil that continues to cause concern. It is the concentration of reserves.
Most of the oil - indeed, the lion's share of the newly ``proven'' oil - is in substrata owned by the Organization of Petroleum Exporting Countries. And most of OPEC is situated in the trigger-happy Persian Gulf.
``People want energy security,'' says Lichtblau, ``and the Middle East is endemically insecure.''
It is also important, says Bijan Mossavar-Rahmani, president of the Denver-based Apache Oil Company, to distinguish between oil supply and oil reserves.
Supply, he notes, is what controls the price of oil. It is determined by how much oil is pumped out of the ground and marketed to users. Right now there is plentiful supply, with an overhang of up to 2 million barrels a day on the world market. This keeps oil, gasoline, and home heating prices modest. A barrel of west Texas intermediate crude sells for a modest $17 today. It sold for $27 in 1985.
Reserves, Mr. Mossavar-Rahmani says, are relevant only to the question of when the world will run out of oil. Geologists first estimate ``oil in place'' from data based on rock porosity. Then they determine ``proven reserves'' based on what can be economically and technologically recovered; this often amounts to about 20 percent of oil-in-place. Then they figure ``probable reserves,'' often 10 to 15 percent of the proven reserves. This is the most accessible oil.
These numbers, however, are subject to all sorts of distortion - from inaccurate measuring to political manipulation:
Mexico, for instance, increased its level of proven reserves in the 1970s so as to improve its creditworthiness. Mossavar-Rahmani, who recalls being suspicious of what Mexico was doing, says Mexico did this by lumping natural gas, condensate, and oil together as ``hydrocarbons'' and then not correcting bankers when they concluded that hydrocarbons was a synonym for oil. Mexico was able to borrow more - to the chagrin today of US bankers.
Venezuela boosted its reserve estimate two years ago by including heavy oil from the Orinoco region. This, says Mossavar-Rahmani, bolstered Venezuela's argument that a possible oil import tax by the United States should exclude Venezuela, which posed itself as vital to US energy security.
And Iran had been underestimating its reserves for years. Now Tehran is using more correct figures, says Mossavar-Rahmani, who helped calculate Iranian reserves under the Shah in the 1970s. Iranian leaders, he notes, are happy to be able to tell their citizens, in effect: ``Never mind that the country's economy is shot, we've got more reserves.''
Despite the fudging, a pattern emerges. US reserves are declining, as are those in the North Sea. Big increases are being registered in the Middle East oil nations (including a new entrant, North Yemen) and in South America (especially Venezuela).
``If nothing else,'' says Daniel Yergin, president of Cambridge Energy Research Associates, ``higher reserves show that the long-term players are in OPEC. There's still a lot of oil, but it is not in Texas and Oklahoma.''