energy

Geoengineering could remain the only option to combat catastrophic effects of climate change

A report from the National Academy of Sciences concluded that experiments in blotting out the sun in order to reduce the amount of the sun’s rays that hit the Earth would be too risky.

Spraying aerosols into the atmosphere – one leading approaching to “geoengineering” – would be a massive science experiment that would have unknown environmental side effects. The fallout on precipitation patterns, agricultural productivity, and the global climate cannot be fully known until it is unleashed. If the United States seeded the atmosphere with aerosols that produced more drought in, say, sub-Saharan Africa, that would potentially raise indefensible ethical questions.

Lowering global temperatures by reducing sun exposure – euphemistically known as “albedo modification” – would also merely treat the symptom of climate change, rather than the cause. The concentration of greenhouse gases in the atmosphere would remain unchanged. As such, sending aerosols up into the sky would be a process that would need to be maintained for many hundreds of years. It would also do nothing to address ocean acidification, another extraordinary problem facing humanity, which could lead to the collapse of fisheries around the world and alter global climate patterns.

Read more: The $17.6 Trillion Solution To Climate Change

“No reputable scientist I know thinks placing tiny reflecting particles in the stratosphere is a good idea, although some support studying it,” argues Philip Duffy, President the Woods Hole Research Center. Other geoengineering strategies include dumping iron into the oceans to suck up carbon.

The panel stated unequivocally that reducing carbon emissions was indeed the preferred method to address climate change. Transitioning to clean energy and replanting forests would offer much safer options, the latter of which is an age-old and well-understood method of carbon capture and storage.

Still, despite the National Academy concluding that albedo modification is unacceptably risky at this time, the panel called for more research into the subject.

What is disconcerting about such geoengineering schemes is that they could probably be attempted using today’s technology and not require significant breakthrough advances. They are likely to be significantly cheaper than carbon capture and sequestration, the other major approach to geoengineering explored by the National Academy report.

Moreover, unilateral “albedo modification” could spark geopolitical conflict, especially in the absence of international laws put in place. The Daily Mail reported that the CIA is possibly looking into how geoengineering might be used to “weaponize” the weather.

Read more: Strategic Thinking: How to Think About the Future

A separate study published in the Annals of the American Academy of Political and Social Science found that people who are ideologically attracted to individualism and free markets are much more likely to accept climate change on its face if it is presented in conjunction with a geoengineering solution. However, if the problem of climate change is broached along with a call for strict limits on emissions instead of geoengineering, people with an individualistic outlook are more likely to reject the science of climate change altogether.

Such findings could boost momentum for geoengineering research to the detriment of carbon mitigation (although that is perhaps up for debate). And for climate-skeptic politicians, for whom denying climate change science is becoming a growing liability, geoengineering could provide a way out of their predicament. It offers the option of “having our cake and eating it too,” as Clive Hamilton, an Australian public ethics professor, phrased it in an interview with The Guardian.

Even worse, the longer the world waits to reduce the rate at which it burns fossil fuels, the more likely that governments will view geoengineering as the only option remaining to combat catastrophic effects of climate change.

This article originally appeared on Oilprice.com.

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Fatih Birol predicts OPEC to "prevail over all other producers for the foreseeable future"

No matter how much oil the United States produces over the next few years, it will never become the next Saudi Arabia in the global oil market, according to Fatih Birol, the new executive director of the International Energy Agency (IEA).

What’s especially interesting about this forecast is that it directly contradicts what Birol said only three months ago, and he gave no explanation for his change of mind.

On Feb. 26, Birol told The Telegraph’s Middle East Congress in London that OPEC, particularly the Persian Gulf members, will prevail over all other producers for the foreseeable future, even though the revolution in extracting shale oil has been “excellent news” for American producers.

“The United States will never be a major oil exporter. Their import needs are getting less but the US is not becoming Saudi Arabia,” Birol told the conference. “Their production growth is good to diversify the market but it will not solve the world’s oil problems.”

Read more: OPEC’s Strategy Is Working Claims Saudi Oil Minister

Certainly, Birol acknowledged, 2014 crude production by countries that are not among OPEC’s 12 members was greater than it had been in three decades, helping create an oversupply of oil that caused prices to erode and robbed OPEC producers of some of their market share.

But at least for the next 10 years, the cartel’s two top producers, Saudi Arabia and Iraq, will be the countries best equipped to meet the world’s demand for energy, especially if non-OPEC producers such as Brazil, Canada and the United States see production falter, Birol said.

Birol’s comments don’t jibe with what he said on Nov. 12, 2014, when he was still the IEA’s chief economist, when introducing the agency’s annual World Energy Outlook. He was appointed to the agency’s top position two weeks ago.

In that report, the IEA said US oil production is likely to exceed Saudi Arabia’s in the next 10 years, making the country nearly self-sufficient in energy and poising it to become a net exporter of oil.

Specifically, the IEA report said, Americans will be pumping 500,000 barrels more than Saudi Arabia in 2020 and 100,000 more than the Saudis in 2025. Riyadh will not reclaim its position as the biggest producer until 2030, when it is expected to extract 1.2 million more barrels per day than US producers.

Read more: The Easy Oil Is Gone So Where Do We Look Now?

Whether Birol’s forecast is correct now or was correct in November, he was not alone among noted economists and institutions in expecting a major surge in US oil production. The American financial services company Citigroup Inc. issued a report on March 20, 2014, predicting that the United States will overcome Saudi Arabia and Russia as the world’s largest oil producer by 2020.

And more recently, on Jan. 3, former U.S. Treasury Secretary Lawrence Summers said the growth of US oil production could perhaps displace Saudi Arabia as the world’s largest net exporter. “The United States has the chance to be to the energy economy of the next decade what Saudi Arabia has been for the last two to three decades,” he told the American Economics Association conference in Boston.

No one but Summers and the people at Citigroup know whether they’ve changed their minds since they spoke so glowingly about US oil production. And as for Birol, only he knows why he’s changed his mind. But for people whose livelihoods depend on understanding the arc of the oil market, such contradictions are confusing at best.

This article originally appeared on Oilprice.com.

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Oil is a volatile market, but prices are in a long term upward trend

Oil’s rapid decline since August of last year has been dramatic. To listen to some commentators you would also think it is unprecedented and irreversible. Those claiming that oil will continue to fall from here and remain low for evermore, however, are flying in the face of both history and common sense. The question we should be asking ourselves is not if oil prices will recover, but when they will.

From June of 2014 until now, the price of a barrel of West Texas Intermediate (WTI) crude oil has fallen approximately 57 percent. As the above chart shows, there have been drops of a similar percentage five times in the last 30 years. The rate of recovery has been different each time, but recovery has come. In addition, since 1999 the chart shows a consistent pattern of higher lows. In other words, oil is a volatile market, but prices are in a long term upward trend.

Read more: How Much Crude Oil Do You Consume On A Daily Basis?

Charts can only tell us so much, however. Even a long term trend can be broken if fundamental conditions change, and that, say those predicting that oil will never recover, is what has happened. There is no doubt that supply has increased. Hydraulic fracturing, or “fracking” technology has unlocked reserves of oil and natural gas previously thought of as unrecoverable. Supply alone, however, doesn’t determine price. We must also consider demand, and that has been increasing too.

According to this chart, from the U.S. Energy Information Agency (EIA), demand has been increasing along with supply since 2010. Admittedly there has been a production surplus since the beginning of 2014 but that is nothing new and is forecast to be back in balance by the end of this year. The increased production, then, is in response to increasing demand; hardly a recipe for a protracted period of low prices. The supply situation makes it unlikely that the recovery will be rapid, but a gradual move up over the next few years is the only logical conclusion.

The low price brigade cites another factor in making their predictions, the rise of alternative energy sources. There is no doubt that there have been significant advances in that area, particularly in wind and solar power, but, according to the EIA, renewables currently account for 11 percent of the world’s energy consumption. That number will undoubtedly grow in the coming years, but, whether we like it or not, oil consumption still looks set to grow over the next few years. Fracking can fill some of that demand, but the simple fact remains that oil is still used extensively, and we are using more of it every year. The price simply cannot stay low for an extended period, but while it does it will delay research and infrastructure spending on renewables, slowing the pace of their adoption.

Read more: OPEC Considers Emergency Meeting On Oil Prices

Any increase in price would be hastened by a decision from OPEC and Saudi Arabia in particular, to reduce production. Right now they say that that is not on the cards, and why would they cut back? Their attitude seems to be that the oversupply was not their doing, and as their oil is cheap to produce, they can sit back and watch those who did cause the problem, most notably the upstart American companies, suffer. OPEC has always played the long game and will undoubtedly do so again, but once the lesson has been taught the pressure to restrict supply somewhat will mount. Again it may take time, but it will probably come.

History tells us that the price of oil will bounce back, but so does basic logic. Oil is a finite resource that we are using at an increasing rate, and as long as that situation remains, the laws of supply and demand mean that the price must recover. That is a good thing. As long as oil remains cheap there is little incentive to invest in the alternatives that we will inevitably need someday, nor to reduce our consumption of what is essentially a dirty fuel source. So, enjoy low fuel prices while you can, but don’t expect them to last forever.

This article originally appeared on Oilprice.com.

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Most of America's daily crude consumption stems from transportation

Oil. The commodity. We know what it’s worth – at least we thought we did – but what does a barrel of the black stuff get you in real life? Before we get theoretical, let’s first consider how much oil you use.

If you’re in the United States, that figure is approximately 2.5 gallons of crude oil per day; roughly one barrel every seventeen days; or nearly 22 barrels per year. That’s just your share of US total consumption of course; the true number is harder to discern – minus industrial and non-residential uses, daily consumption drops to about 1.5 gallons per person per day. Subtract the percentage of the population aged 14 and below and the daily consumption climbs back above 2 gallons. This is big picture, and it’s quite variable, so let’s go further.

Most of the nation’s daily crude consumption stems from transportation. If you’re an average driver in an average car, your crude consumption is in the order of 12 barrels per year. However, if your car is more than ten years old, chances are that figure is closer to 15 barrels annually. Does an electric car offer significant savings? Of course it does, but for an unconventional comparison let’s assume all of the electricity is sourced from oil – in truth, petroleum is not a very efficient fuel and accounts for just 1 percent of electricity generation in the US. Under this assumption, a Tesla Model S, with an 85 kilowatt-hour (kWh) battery and a range of 260 miles, will consume approximately 8 barrels of crude per year.

Read more: The World’s 10 Biggest Energy Gluttons

Frequent flyer? Say 2,000 miles per year on a US carrier? Add about two-thirds of a barrel of crude to your annual consumption.

A 3,000-mile cruise on the MS Oasis of the Seas may sound relaxing, but at roughly 4 barrels of crude per passenger, the carbon footprint alone is worth reviewing.

What about residential use? Using similar assumptions to the electric car example above, we can calculate our annual home electricity use in barrels of crude. In 2013, an average American home consumed 10,908 kWh of electricity, or approximately 20 barrels of crude. The real number – considering oil’s role in electricity generation – is far lower at around one-fifth of a barrel.

Petroleum products are active in nearly every facet of our daily lives; food and consumer chains are no exception. Take a look at bottled water for example. It’s an energy intensive business, one with an estimated energy expenditure of 32 million barrels of oil per year – for 33 billion liters of bottled water purchased in the US. The production of the single-use polyethylene terephthalate (PET) bottles alone requires the energy equivalent of almost 17 million barrels of oil.

Obtaining an accurate picture of your daily oil consumption is truthfully quite difficult. Your consumption is dependent on my consumption, which is dependent on someone’s consumption halfway around the globe to make a simple analogy. Moreover, consumption is largely bound by perception and the barrel is still a relatively abstract measure – few will ever lay hands on one. So for the sake of understanding, let’s look at what else a barrel gets you.

Read more: The Easy Oil Is Gone So Where Do We Look Now?

According to Chevron, one barrel of oil produces: 170 ounces of propane; 16 gallons of gasoline; one gallon of roofing tar; a quart of motor oil; 8 gallons of diesel fuel; 70 kWh of electricity; four pounds of charcoal briquettes; 27 wax crayons; and 39 polyester shirts.

For good measure, it can power a 42’’ plasma television for about a year and a half – again, it’s not very efficient. It can charge your laptop PC every day for over 7 years, or your iPhone for more than 240 years.

Finally, on the open market, a barrel of West Texas Intermediate will fetch around $50.

* 1 barrel = 42 U.S. gallons = 5,800,000 Btu
1 gallon gasoline = 124,262 Btu
1 gallon jet fuel = 128,100 Btu
1 barrel = 533 kWh (Power plant heat rate of 10,991 Btu/kWh)

Source: EIA and EIA and EIA

This article originally appeared on Oilprice.com.

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Saudi minister had pushed through a plan to maintain oil production at 30 million barrels a day and cause a drop in the crude oil price

Saudi Oil Minister Ali al-Naimi, the architect of OPEC’s strategy to regain market share by causing the price of crude oil to plunge, says his plan is working, and data from petroleum research firms seem to back him up.

Making his first public comments in two months, al-Naimi told reporters in the southwestern Saudi city of Jazan that the markets have cooled off, and cited Brent crude, the global benchmark, as an example, noting that its price has stabilized at about $60 per barrel.

He also pointed to data that inexpensive oil is driving up demand, notably in China and the United States, which eventually could lead to price stability or to a price rebound.

But Al-Naimi warned naysayers not to upset this new balance. “Why do you want to rock the markets?” he asked. “The markets are calm. … Demand is growing.”

Read more: OPEC Considers Emergency Meeting On Oil Prices

If al-Naimi is right, then his strategy was correct, and it acted quickly. It was only three months ago at OPEC’s headquarters in Vienna that the Saudi minister pushed through a plan to maintain oil production at 30 million barrels a day, declaring a price war with US shale oil producers who rely on costly hydraulic fracturing, or fracking, to extract oil embedded tightly in underground rock.

The US shale producers had not only created a global oil glut, which was depressing the price of oil, but they also had turned their country from OPEC’s biggest customer to a nation headed towards energy independence.

OPEC’s decision led to even lower oil prices, meaning lower revenues, and sometimes even losses, for many oil companies. The financial services concern Cowen & Co. estimates that as a result, total capital expenditures for both production and exploration will plunge by more than $116 billion this year.

As for US shale producers, some folded under the Saudi strategy. Baker Hughes Inc., one of the world’s largest oilfield services companies in the world, reports that the number of oil rigs operating in the United Stated declined by fully 35 percent since as recently as Dec. 5, leaving the country with the fewest rigs in four years.

Still, lower fuel prices are attractive at the retail market, whether on an industrial scale or for the motorist who simply needs to fuel his or her car. On the large scale, Chinese manufacturing has expanded, if only slightly, this month, according to the HSBC/Markit Purchasing Managers’ Index. It climbed to a four-month high of 50.1, where an even 50 separates economic growth from contraction.

Read more: Could This Be Saudi Arabia’s Best Kept Secret?

There’s more optimistic news, particularly on the smaller retail level. The research group JBC Energy says US demand for gasoline grew by nearly a half-million barrels a day in January. In India, it says, the demand was 18 percent higher in January than in the same month the previous year.

The JBC report said the allure of cheap fuel can alter driving habits, including what car a customer buys next. And that’s supported by Autodata Publications Inc., which reports that consumers again are opting for cars that are more fuel-hungry: Sales of SUVs and light trucks grew by 19.3 percent from January 2014 to January 2015, while more economical passenger cars grew by only 7.7 percent.

Despite this good news for al-Naimi, if the price of oil has finally bottomed out and begins to rise again, won’t the US shale producers get back into the act with a vengeance?

This article originally appeared on Oilprice.com.

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Rather than using its earnings to develop more fields, the state-owned PDVSA has been diverting money for political and social projects

As the finances of Venezuela continue to deteriorate under the collapse of crude oil prices, the government of President Nicolas Maduro is becoming more paranoid and vindictive.

Venezuela derives the vast majority of its export earnings from sending oil overseas. With the largest endowment of crude oil reserves in the world, the oil-driven economy worked well for the late Hugo Chavez: he provided generous support for the poor, and built allies in the western hemisphere by dispensing cash and cheap oil in exchange for political allegiance.

But state-owned PDVSA has struggled to keep production up. Rather than using its earnings to develop more fields, much of its earnings have been diverted for political and social projects. Chavez also purged PDVSA of thousands of experienced workers, leaving the company short of well-trained staff.

Chavez could paper over the decay of PDVSA’s production base because oil prices were so high in his final years. And for the first year or so of Maduro’s tenure, while the economy began showing worse signs of stress, he too didn’t feel any urgency to solve PDVSA’s problems.

Read more: Oil Price Crash: Top 5 At-Risk Countries

However, the utter bust in oil markets pulled the rug out from beneath the Venezuelan economy. Inflation is running at an annual rate of 68 percent. Shortages of food and medical supplies are common. Shoppers at grocery stores need to submit finger prints to ensure they are not purchasing more than their allotted amount of basic goods. A confusing set of varying exchange rates and currency controls are doing very little to slow capital flight.

Maduro is cracking down on political opponents as the country deals with the economic crisis. Antonio Ledezma, the Mayor of Caracas, was arrested on Feb. 20 on charges of conspiracy and working with the U.S. to stage a coup, touching off a wave of protest. Last year, in the wake of the unprecedented riots facing the “Bolivarian” regime, Leopoldo Lopez was also tossed in jail. Dozens of other perceived political enemies remain locked up. A teenager was shot and killed at an anti-government rally on Feb. 24. Maduro’s government was quick to blame the police officer – as if security forces have not been encouraged from above to take a hard line with opposition protests over the last few years.

Maduro’s pronouncements have become more paranoid as the economy has worsened. He has accused Vice President Joe Biden of being the mastermind behind a plot to oust him from power, and questioned whether President Obama was aware of that fact. On Feb. 2 President Maduro had the head of a major retail chain arrested for conspiring against the state by creating long lines at store locations that Maduro said was “irritating the people.”

Read more: Could Venezuela Become World’s Next Energy Giant?

Maduro continues to rely on assertions that food shortages, economic hardships, and even violence are the result of American plots, a claim that has worked in the past but is becoming an increasingly tired line of argument for many Venezuelans.

The only hope for Maduro is a dramatic rise in oil prices, which could provide a reprieve from the economic crisis he finds himself in. He has pled with Saudi Arabia and other OPEC members to slash production to boost prices, but to no avail. He even went hat in hand to China for financial assistance, with only modest pledges from Chinese President Xi Jingping.

The economic situation may only grow worse. The government’s budget breaks even with oil prices at an estimated $117.50 per barrel. Inflation could rise to an eye-popping 100 percent in 2015, and GDP could fall by as much as 7 percent. The government will likely see a shortage of foreign exchange of at least $7 to $8 billion this year. Gauging the credit default swap market, investors are betting that the chances of a default over the next five years are a near certainty.

With no imminent rebound in sight for oil prices, Maduro is resorting to state-sponsored repression to quell growing opposition.

This article originally appeared on Oilprice.com.

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New rules, which are expected to be finalized in May, would require the phase-out of older cars, in favor of newer reinforced designs

The latest oil train derailments could force the federal government to tighten the regulatory screws further than they had planned.

The train disasters in Ontario and West Virginia were the latest in a long line of explosions from oil trains, or “bomb trains” as they have been called derisively by their critics. The problem, regulators thought, were the thin-walled flimsy DOT-111 railcars, which had not originally been designed to safely carry volatile crude oil.

U.S. federal transportation regulators began writing new rules that would require the phase-out of these older cars, in favor of newer reinforced designs.

The tricky problem facing regulators is one inconvenient detail – the newer railcars that have been trumpeted as much safer were the ones that derailed and exploded on February 16 in West Virginia. The so-called CPC-1232 cars are an upgrade over the DOT-111, with thicker hulls to prevent puncturing and pressure valves to vent gas in the event of the railcars overheating.

Read more: Train Carrying Volatile Bakken Crude Derails In Canada

Nevertheless, even though the CPC-1232 cars have demonstrated that they are inadequately safe, much of the crude hitting the nation’s railways are not even traveling to that standard. Railcar manufacturers do not have the capability to ramp up production of the CPC-1232s fast enough, with a backlog of at least 50,000 cars. Meanwhile, there are still around 171,000 DOT-111s still in operation.

And in another loophole exposed by E&E News, railroad companies can even continue to use damaged railcars which leak oil, with the approval from the federal government.

Another problem is the extra volatility that Bakken crude has demonstrated. Due to the associated volatile gas that comes with oil drilled in the Bakken, the oil carried by train coming from North Dakota is more dangerous than conventional crude. The state of North Dakota has required that producers process the oil to remove the gases, and that rule takes effect on April 1. While it is so far unclear if the crude that exploded in the West Virginia incident had undergone this type of processing, it would not have been required.

“At this point, we have to let this order go into effect and let the operators get the equipment installed,” the Director of North Dakota’s Department of Mineral Resources Lynn Helms said in response to questions raised in the wake of the West Virginia derailment about North Dakota needing to address safety more aggressively.

Safety on the rails is critical because of the surging volumes of oil moving on the nation’s railways. An estimated 400,000 barrels of oil were transported by railcar in 2013, a dramatic jump from just 11,000 barrels in 2009, according to data from the Association of American Railroads.

The federal government has been criticized for taking way too long to issue new safety standards. The Department of Transportation proposed new rules in August, but has now twice pushed off finalizing those rules, missing the original deadline at the end of 2014.

The proposal has not committed to one rail car design, instead it reviewed several with different safety features and levels of wall thickness. They also may only require a gradual phase-out over the next two to three years of the DOT-111 railcars. Some politicians, including Senators from North Dakota, have resisted a swifter phase-out, fearing damage to the state’s oil production. The oil shipping industry has heavily lobbied the U.S. Congress for favorable treatment.

Read more: State Of Emergency In West Virginia Following Oil Train Explosion

But the latest disaster in West Virginia is once again raising pressure for stronger action. “Yet again, we have seen a rupture-prone rail car carrying volatile crude oil wreak havoc on a community, and it further demonstrates that the federal Department of Transportation and Office of Management and Budget must release tough, comprehensive rail car standards to help avoid a future tragedy,” U.S. Senator Chuck Schumer said in a statement.

Canada is also stepping up its efforts. The government is considering a tax on oil-by-rail shipments, with the proceeds put into a compensation fund to cover damages from future derailments.

All eyes turn to the White House where the Department of Transportation recently sent a “comprehensive” set of rules. A final version is expected in May. Pressure will be on the Obama administration to ensure a weak rule doesn’t emerge as the West Virginia disaster is just the latest reminder that rail safety regulations are inadequate.

This article originally appeared on Oilprice.com.

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Studies point to the Middle East, Latin America, North America and Africa as the key regions for future oil plays

In 2008, Canadian economist Jeff Rubin stunned the oil market with a bold prediction: With the world economy growing at 5 percent a year, oil demand would grow with it, outpacing supply, thus lifting the oil price from $147 to over $200 a barrel.

The former chief economist at CIBC World Markets was so convinced of his thesis, he wrote a book about it. “Why the World is About to Get a Whole Lot Smaller” forecast a sea change in the global economy, all driven by unsustainably high oil prices, where domestic manufacturing is reinvigorated at the expense of seaborne trade and people’s choices become driven by the ever-increasing prices of fossil fuels.

In the book, Rubin dedicates an entire chapter to the changing oil supply picture, with his main argument being that oil companies “have their hands between the cushions” looking for new oil, since all the easily recoverable oil is either gone or continues to be depleted – at the rate of around 6.7% a year (IEA figures). “Even if the depletion rate stops rising, we must find nearly 20 million barrels a day of new production over the next five years simply to keep global production at its current level,” Rubin wrote, adding that the new oil will match the same level of consumption in 2015, as five years earlier in 2010. In other words, new oil supplies can’t keep up with demand.

Of course, Rubin at the time was talking about conventional oil – land-based and undersea oil – as well as unconventional oil sands. The shale oil “revolution” in the United States that took off soon after the publication of his book has certainly changed the supply picture, and the recent collapse in oil prices has forced Rubin to eat his words. With U.S. shale oil production soaring from 600,000 barrels a day in 2008 to 3.5 million barrels a day in 2014, the United States over the past few years has flooded the market with new oil from its shale formations, including the Eagle Ford in South Texas and the Bakken in North Dakota. According to the Energy Information Administration (EIA), total U.S. production (conventional and unconventional) will increase to 9.3 million barrels a day this year, the most since 1972.

Read more: This Huge Oil Buyer Is Appearing Nextdoor To The U.S.

While some observers, including oil giant BP, are now predicting a slowdown in U.S. shale oil production as wells are depleted at a faster rate, to be replaced by Middle Eastern output that has lost ground to U.S. shale, the thesis posed by Jeff Rubin in 2008, that the world is running out of oil, seems to have changed to: Is the world swimming in oil?

In this continuing climate of abundant oil production, Oilprice.com sought to find out where the new oil will be found. The data could be used in a further analysis to determine whether an oversupplied market will continue to depress oil prices into the future – or whether a price correction is likely given a tightening of the market on the supply side.

According to a 2013 report by Wood Mackenzie, the world holds 1.4 trillion barrels of oil equivalent oil and gas reserves, with the Middle East, Latin America, North America and Africa identified as the key regions for future oil plays.

Of course, many of the new fields are uneconomic at current prices, so it is instructive to look at the largest oil fields to see where oil producers are likely to keep pumping, even though many of these fields are in decline.

They include Ghawar and Safaniya in Saudi Arabia, Burgan in Kuwait, and Rumalia and West Qurna-2 in Iraq. These five fields were named the most important by Oilprice.com in an article last June. Ghawar, the world’s largest field, has an estimated 70 billion barrels of remaining reserves, more than all but seven other countries, according to the EIA. In production since the 1950s, it continues to produce at 5 million barrels a day.

If you noticed the dominance of the Middle East in this list, you’d be right. Current estimates have over 80 percent of the world’s proven oil reserves located in OPEC member countries, with Middle Eastern reserves comprising 65 percent of the OPEC total.

Adding to the Oilprice.com list, Forbes named Majnoon in Iraq, Khuzestan (also the name of a province) in Iran, Kashagan in the Caspian Sea, Khurais in Saudi Arabia, the Tupi field offshore Brazil, Carabobo in Venezuela’s Orinoco heavy oil belt, and the North Slope of Alaska among its top 10 fields of the future.

Fortune places the Orinoco belt in Venezuela among its six largest untapped fields, at an eye-watering 513 billion barrels of recoverable crude. In comparison the Chicontapec Basin in Mexico, also on the list, is a Lilliputian at 10 billion barrels. Others include the Santos and Campos Basins in offshore Brazil, at 123 billion barrels, the Supergiant field in the southwest desert of Iraq, at between 45 and 100 billion barrels, and the Jubilee Field in Ghana, estimated to contain 1.8 billion barrels of recoverable crude.

The Canadian oil sands should of course also be included in the matrix of future oil supply. Despite the difficulty and higher-cost, compared to conventional sources, of stripping the bitumen from the oil sands and processing it into heavy oil, the vastness of the reserves contained in the sands of northern Alberta cannot be underestimated. According to the Alberta government the oil sands has proven reserves of about 168 billion barrels, the third largest proven crude oil reserve in the world, after Saudi Arabia and Venezuela. Canadian oil sands production is forecasted to grow from about 2 million barrels per day to 3.7 million barrels per day by 2020 and 5.2 million barrels per day by 2030, according to Alberta Energy.

Many have pointed to the Arctic as the answer to the depletion of existing oil and gas fields. The region, which crosses Russia, Alaska, Norway and Greenland, is estimated to hold 166 billion barrels of oil equivalent, more oil and gas than Iran and enough to meet the world’s entire consumption of crude oil for five years, reported The Daily Telegraph.

Drilling down a bit further, the US Geological Survey estimates that over 87% of the Arctic’s oil and gas resources are located in seven Arctic basin provinces: Arctic Alaska Basin, East Barents Basin, East Greenland Basin, West Greenland East Canada Basin, East Greenland Rift Basin, West Siberian Basin and the Yenisey-Khatang Basin.

The Prudhoe Bay field in Alaska, which has been pumping oil since 1977, is the largest oil field in North America, at about 25 billion barrels. Around 16 percent of the Arctic’s undiscovered oil and gas is located on land, with the remaining potential either locked in continental shelves or underwater at depths over 500 metres.

Of the seven basins outlined by the USGS, the most abundant is Arctic Alaska, at 29.36 billion barrels of crude oil, followed by the Amerasia Basin, at 9.72 billon, and the East Greenland Rift Basin at 8.90 billion, according to Geology.com.

Among the oil majors eyeing the Arctic prize, Shell has been drilling off the coast of Alaska for decades, Statoil is active in the Norwegian Arctic, and ExxonMobil is exploring with Russia’s Rosneft in the Russian far north. Last year Rosneft/ ExxonMobil discovered a field that could hold up to 730 million barrels of oil, but for the time being, exploration looks thin. With low oil prices, most oil companies are reining in capital costs, and exploration expenditures are a high-priority line item. Statoil and Chevron have both put their Arctic plans on ice, and the ExxonMobil partnership with Rosneft could be in trouble due to Western sanctions against Russia. Shell is currently the only company sinking any capital into the Arctic, with the Anglo-Dutch firm announcing at the end of January that it plans to proceed with a $1-billion Arctic drilling this summer.

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And what of the shale oil reserves that have propelled the United States to becoming close to energy-independent and threaten to knock Saudi Arabia off its pedestal as the world’s top oil producer? In 2013, the EIA conducted the first-ever U.S. analysis of global shale oil reserves. It estimated “technically recoverable” (as opposed to economically recoverable) shale oil resources of 345 billion barrels in 42 countries, the equivalent of 10 percent of global crude oil supplies – and enough to cover over a decade of oil consumption.

According to the EIA, Russia and the United States have the largest shale oil resources, at a respective 75 billion barrels and 58 billion barrels, followed by China, Argentina and Libya. The other countries on the top 10 list of countries with technically recoverable shale include Australia, Venezuela, Mexico, Pakistan and Canada.

The EIA report also shows a marked increase in the number of prospective shale deposits globally compared to an earlier 2011 report. That report listed 32 countries with shale versus 41 in 2013, 48 basins versus 95, and half the number of formations, at 69 in 2011 versus 137 in 2013.

This article originally appeared on Oilprice.com.

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The search giant is investing $350 million in a fund to cover home solar panel installations

Google is investing $300 million in a fund designed to help people install solar panels on their houses.

The fund is being created by SolarCity, a fast-growing solar energy startup that boasts SpaceX CEO Elon Musk as its chairman. SolarCity has attracted $750 million overall for the fund, which will finance solar panel installations for homeowners in 15 states. Homeowners who install the panels will then pay SolarCity for the electricity they generate.

SolarCity claims its customers “usually” pay less for electricity than people who use traditional fossil fuels — and it says its energy is cleaner, too.

“It’s good for the environment, good for families and also makes good business sense,” Sidd Mundra, Renewable Energy Principal at Google, said in a statement.

The investment is Google’s largest in renewable energy projects.

It's discovery appears to confound current theories about how black holes are created

A team of international astronomers has discovered a black hole of almost unimaginable proportions.

At 12 billion times more massive than the sun, it challenges current cosmological thinking, reports Reuters.

“Our discovery presents a serious challenge to theories about the black hole growth in the early universe,” lead researcher Xue-Bing Wu for Peking University, China told the news agency.

The enormous object was formed 900 million years after the Big Bang, and scientists are stumped as to how a black hole of that size could have grown in such a relatively short time.

“Current theory is for a limit to how fast a black hole can grow, but this black hole is too large for that theory,” said fellow researcher Dr. Fuyan Bian, of Australian National University.

Not only is the black hole the biggest ever seen but also it’s at the center of the largest quasar ever discovered. (Quasars are the brightest and most powerful objects in the universe, with this one emitting huge amounts of energy and light as matter is ripped apart by the black hole at its core.)

For comparison, the black hole at the center of our galaxy, the Milky Way, has only about four to five million times the mass of the Sun.

The black hole was discovered by a team of global scientists at Peking University, China, tasked with mapping the northern sky, and their findings were published in the journal Nature.

[Reuters]

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