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The end of cheap oil: Current status and prospects

Author

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  • Tsoskounoglou, Miltos
  • Ayerides, George
  • Tritopoulou, Efi

Abstract

This paper, analyses the factors impacting the price of crude oil in order to examine the likely evolution of the oil market and attempts to answer the question, whether cheap oil is already a thing of the past. Based on data made publicly available mostly by the major oil companies, it examines the effects of demand and supply, the evolution of world oil reserves, the trends in new discoveries of new oilfields, the evolution of world Gross Domestic Product (GDP), and the depletion of oil resources. The analysis concludes that the world peak in conventional oil production--the point beyond which oil production will irreversibly start declining--is approaching and will be reached, even according to the most optimistic scenarios, before 2040 and quite possibly much sooner. If the appropriate solutions for substituting crude oil and for conserving the use of energy are not implemented in time, then the current upward trend in oil prices is bound to continue.

Suggested Citation

  • Tsoskounoglou, Miltos & Ayerides, George & Tritopoulou, Efi, 2008. "The end of cheap oil: Current status and prospects," Energy Policy, Elsevier, vol. 36(10), pages 3797-3806, October.
    • Handle: RePEc:eee:enepol:v:36:y:2008:i:10:p:3797-3806
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    Cited by:

    1. Carlos Pestana Barros & Guglielmo Maria Caporale & Luis A. Gil-Alana, 2012. "Long Memory in German Energy Price Indices," CESifo Working Paper Series 3935, CESifo.
    2. Orta-Martínez, Martí & Finer, Matt, 2010. "Oil frontiers and indigenous resistance in the Peruvian Amazon," Ecological Economics, Elsevier, vol. 70(2), pages 207-218, December.
    3. Lee, Chi-Chuan & Lee, Chien-Chiang & Ning, Shao-Lin, 2017. "Dynamic relationship of oil price shocks and country risks," Energy Economics, Elsevier, vol. 66(C), pages 571-581.
    4. Verbruggen, Aviel & Al Marchohi, Mohamed, 2010. "Views on peak oil and its relation to climate change policy," Energy Policy, Elsevier, vol. 38(10), pages 5572-5581, October.
    5. Barros, C.P. & Assaf, A., 2009. "Bootstrapped efficiency measures of oil blocks in Angola," Energy Policy, Elsevier, vol. 37(10), pages 4098-4103, October.
    6. Barros, Carlos Pestana & Gil-Alana, Luis A. & Payne, James E., 2011. "An analysis of oil production by OPEC countries: Persistence, breaks, and outliers," Energy Policy, Elsevier, vol. 39(1), pages 442-453, January.
    7. Sena, Marcelo Fonseca Monteiro de & Rosa, Luiz Pinguelli & Szklo, Alexandre, 2013. "Will Venezuelan extra-heavy oil be a significant source of petroleum in the next decades?," Energy Policy, Elsevier, vol. 61(C), pages 51-59.
    8. Vijai Kaarthi Visvanathan & Karthikeyan Palaniswamy & Dineshkumar Ponnaiyan & Mathan Chandran & Thanarajan Kumaresan & Jegathishkumar Ramasamy & Senthilarasu Sundaram, 2023. "Fuel Cell Products for Sustainable Transportation and Stationary Power Generation: Review on Market Perspective," Energies, MDPI, vol. 16(6), pages 1-21, March.
    9. Pérez-Ortiz, Alberto & Borthwick, Alistair G.L. & McNaughton, James & Avdis, Alexandros, 2017. "Characterization of the tidal resource in Rathlin Sound," Renewable Energy, Elsevier, vol. 114(PA), pages 229-243.
    10. Delannoy, Louis & Longaretti, Pierre-Yves & Murphy, David J. & Prados, Emmanuel, 2021. "Peak oil and the low-carbon energy transition: A net-energy perspective," Applied Energy, Elsevier, vol. 304(C).
    11. Shiyi Chen & Cunyong Ju & Yang Du & Tianqi Mu & Tijiu Cai, 2023. "Differences in the removal efficiency of heavy metals in soils with different vegetation backgrounds along the China-Russia crude oil pipeline," Plant, Soil and Environment, Czech Academy of Agricultural Sciences, vol. 69(12), pages 628-639.
    12. Nesma M. Helal & Hesham F. Alharby & Basmah M. Alharbi & Atif. A. Bamagoos & Ahmed M. Hashim, 2020. "Thymelaea hirsuta and Echinops spinosus : Xerophytic Plants with High Potential for First-Generation Biodiesel Production," Sustainability, MDPI, vol. 12(3), pages 1-16, February.
    13. Sáfián, Fanni, 2014. "Modelling the Hungarian energy system – The first step towards sustainable energy planning," Energy, Elsevier, vol. 69(C), pages 58-66.
    14. Barros, Carlos Pestana & Managi, Shunsuke, 2009. "Productivity assessment of Angola's oil blocks," Energy, Elsevier, vol. 34(11), pages 2009-2015.
    15. Carlos Pestana Barros & Luis A. Gil-Alana, 2011. "Oil Prices: Persistence and Breaks," Faculty Working Papers 09/11, School of Economics and Business Administration, University of Navarra.
    16. Kathrin Sunde & Andreas Brekke & Birger Solberg, 2011. "Environmental Impacts and Costs of Hydrotreated Vegetable Oils, Transesterified Lipids and Woody BTL—A Review," Energies, MDPI, vol. 4(6), pages 1-33, May.
    17. Kovacevic, Vujadin & Wesseler, Justus, 2010. "Cost-effectiveness analysis of algae energy production in the EU," Energy Policy, Elsevier, vol. 38(10), pages 5749-5757, October.
    18. Pérez-Ortiz, Alberto & Borthwick, Alistair G.L. & McNaughton, James & Smith, Helen C.M. & Xiao, Qing, 2017. "Resource characterization of sites in the vicinity of an island near a landmass," Renewable Energy, Elsevier, vol. 103(C), pages 265-276.
    19. Dale, Michael & Krumdieck, Susan & Bodger, Pat, 2011. "Net energy yield from production of conventional oil," Energy Policy, Elsevier, vol. 39(11), pages 7095-7102.
    20. Botelho, Tatiana & Magrini, Alessandra & Schaeffer, Roberto, 2014. "Plumbing the depths: Utilizing O&G reserve profiles to develop forward-looking risk assessments for exploration and production activities," Energy Policy, Elsevier, vol. 69(C), pages 489-500.
    21. Yang, Yuying & Li, Jianping & Sun, Xiaolei & Chen, Jianming, 2014. "Measuring external oil supply risk: A modified diversification index with country risk and potential oil exports," Energy, Elsevier, vol. 68(C), pages 930-938.
    22. Charles A. S. Hall & Stephen Balogh & David J.R. Murphy, 2009. "What is the Minimum EROI that a Sustainable Society Must Have?," Energies, MDPI, vol. 2(1), pages 1-23, January.
    23. Wang, Qiang & Chen, Xi & Jha, Awadhesh N. & Rogers, Howard, 2014. "Natural gas from shale formation – The evolution, evidences and challenges of shale gas revolution in United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 1-28.
    24. Lin, Boqiang & Wang, Ting, 2012. "Forecasting natural gas supply in China: Production peak and import trends," Energy Policy, Elsevier, vol. 49(C), pages 225-233.
    25. Ali Mirchi & Saeed Hadian & Kaveh Madani & Omid M. Rouhani & Azadeh M. Rouhani, 2012. "World Energy Balance Outlook and OPEC Production Capacity: Implications for Global Oil Security," Energies, MDPI, vol. 5(8), pages 1-26, July.

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    Keywords

    Peak oil Depletion Discoveries;

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