honors c.a.d.. we know that our oil supplies are varied, and that we have an incredible thirst for...
TRANSCRIPT
Honors C.A.D.
We know that our oil supplies are varied, and that we have an INCREDIBLE thirst for oil.
Where does it come from? Where do we get it from?
http://www.pbs.org/frontlineworld/stories/colombia/images/map.swf
In reality, we do import close to 60% of our oil.
We use 20 million barrels of oil a day (178 million gallons).
The Point – WE NEED A LOT OF IT!
Why does oil change in price so often? Think back to supply and demand:
When global supply decreases, what happens to the price? – It increases.
Seasons also affect prices – How? Cleaner-burning summer fuels add to this
What else can affect prices? Natural disasters –
think Katrina Refining capacity Political instability
To make things simple, think of a dollar’s worth of gasoline. Who get what out of that dollar? Taxes: 15 cents Distribution and Marketing: 11 cents Refining: 7 cents Crude oil suppliers: 67 cents
In other places, gasoline is much higher because of higher taxes, distance from refineries.
Drilling – mostly on land – Middle East, Africa, Canada, Russia, etc.
Shipped here in tankers and refined Offshore drilling – billions of barrels of oil
underneath the ocean, but there are risks: Storms disrupting production Rough seas Oil spills – like right now
Imagine this situation: Probable Oil Reserves stand at 531 billion barrels The world consumes 16.5 billion barrels each year.
How many years until we run out?
You would think that the world was over here! Those numbers reflect 1970 statistics. Today, we consume over 26 billion barrels of oil
each year, and reserves stand at over 1 trillion.
We probably will never pump every barrel of oil out of the Earth – Why?
The answer, if you are wondering, lies with “probable reserves.”
Probable reserves – oil/coal/gas that has been discovered and can be extracted with current technology.
What can change about probable reserves?
Where does our oil come from? Why the price changes all the time? What are some potential causes to a price
change? “How” do we get it? Define a probable reserve, and how they can
change.