Crude oil rules the world

Crude oil is the most valuable substance on earth. Without the black gold, civilization would be unrecognizable. We check how secure our oil supply really is in the midst of reports of dwindling reserves.

Die Förderung auf rauer See ist mühsam aber unverzichtbar. Nach aktuellen Schätzungen von BP reichen die Vorkommen, bei gleichbleibendem Energienachfrage, noch mindestens 40 Jahre. Photo: BP

The extraction on rough sea is laborious, but essential. According to current estimates of BP, the occurence, with constant energy demand, will be sufficient for another 40 years. Photo: BP

The wind is howling, and menacing waves sweep across the ocean below the drilling platform, several kilometers off the coast of Brazil. The 200 meter tall semi-submersible, as such floating oil rigs are known, is fixed to the sea floor with steel cables. Despite this, it sways in a concerning manner as the rain lashes the rig workers’ faces. They’re grateful for their protective clothing on days like this. Many days are spent under the blistering sun, and even on these days they are required to wear their full protective gear. Every day, they extract several hundred thousand barrels of crude oil from the ocean floor far below, its sulphurous stench combining with the salty sea air. These men don’t mind. The curious blend stays in their nostrils long after returning to shore for a few days of recuperation. Work on an oil rig is back-breaking but indispensable – the human race is addicted to this sticky, stinking substance.

Hit rate regarding the search for oil improves steadily

Crude oil was first used around 12,000 years ago as cement for weapons and tools, and as paint for jewelery and sculptures. It was later used as lamp fuel. Its real potential was first discovered during the industrial revolution. Nowadays it finds use as a heating fuel, and, far more importantly, the most prevalent energy source for transport. No other energy source comes close. In the early 19th century – the beginning of the ‘oil age’ – private entrepreneurs fought over the world’s oil deposits, and business was booming. At a certain point, however, the countries with the greatest oil deposits realized the value of what they were sitting on. This led to the balance of power in energy markets shifting radically within a short space of time. Transporting oil from faraway lands to the world’s industrial powerhouses remained almost exclusively the task of private corporations such as Esso, Shell and BP as recently as the 1970s. These corporations also managed its sale upon arrival. The brands are still around, and although their market power has been heavily eroded, they still enjoy substantial economic potential. The biggest oil corporations are now state-owned, with far less evocative names. Amongst them are Rosneft (Russia), Saudi Aramco (Saudi Arabia), NIOC (Iran), PdVSA (Venezuela), CNPC (China), Pemex (Mexico), and Sonatrach (Algeria). According to estimates (state-run corporations do not release any official figures), stateowned oil corporations control between 80 and 90 percent of global oil production.

According to BP’s calculations, there are approximately 1.68 billion barrels of oil left in global deposits (1 barrel = 159 liters). This value has been repeatedly revised upward in recent decades thanks to advances in technology. BP estimates that the remaining crude oil deposits will suffice for at least another forty years, assuming energy demands remain stable at current levels. A revolution in drive technology could, however, lead to these estimates being revised upward once again. Other technological advances will also make oil transport safer and more efficient. “Avoiding corrosion to the facilities and pipelines incurs significant costs, especially offshore,” explains BP Group Head of Technology David Eyton. “In order to identify corrosion as early as possible, we use wireless sensors that keep us informed of the condition of the pipes.”

Now, the rusting-through of pipelines is almost out of the question. The success rate in the search for oil has also steadily improved. In the past, companies drilled eleven times on average in order to hit oil. Nowadays, that average has sunk to two test bores. Supercomputers and the ability to produce subterranean 3D imaging have helped considerably in ending the expensive lottery of divining for new oil wells. Each borehole costs several million US dollars. The search for new sources of oil continues around the world at a rapid rate. The USA used to be constantly rated as one of the world’s most powerful oil producers, but this position came under threat in the early 2000s as domestic production began to slow. Rising oil prices, however, suddenly made a new extraction method viable. Fracking brought the Americans up to the top of their game again, whilst simultaneously providing for heated debate amongst experts. Fracking, or hydraulic fracturing, involves releasing oil from rock layers, something achieved by introducing a chemical solution to force the oil from the strata. Environmental organizations criticize this method as the substances used can pollute the earth and the water table for years. Putting environmental concerns aside for a moment, even business experts are not convinced. They believe fracking is only viable when oil prices exceed 60 dollars. They currently lie at around 45 dollars.

Piled High: The drill rods tower above the platform deck.

Piled High: The drill rods tower above the platform deck. Photo: BP

The Changing Face of Energy

Crude oil continues to rule the world. But what comes after that? According to experts, transport will continue to be dominated by oil for another twenty years at least. Especially when it comes to long distances and heavy loads, the energy value of crude oil products cannot be beaten. Current technology cannot replace fossil fuel for aircraft and cargo ships. Experts forecast a battle between hybrid technology, batteries and fuel cells for supremacy amongst smaller vehicles with more modest requirements in terms of range. “We believe that the hybrid vehicle concept is the most technologically mature,” states BP’s Head of Fuel Research in Bochum Dr. Peter Sauermann. His reasons are clear: “A hybrid is the best option for a second car for urban driving. On short journeys, drivers will pretty much forget that their car also has a petrol or diesel engine under the bonnet.” Such plug-in hybrids – the batteries of which suffice for fully-electric short-radius journeys – only use the combustion engine on longer journeys. “Instead of filling up with fuel three or four times every month, the hybrid owner will fill the tank maybe once every six months,” adds Sauermann.

However, electricity is predominantly generated by burning other fossil fuels, such as coal for instance. Coal’s share of electricity production in Germany was 42.2 percent in 2015. Almost nine percent was provided by natural gas. These are the findings of a report compiled by the Arbeitsgemeinschaft Energiebilanzen e. V. (Energy Balance Working Group). The report also noted that 14.1 percent of domestic energy is generated by nuclear plants. The German government has announced that no more nuclear power will be used after 2022. To cover the resulting shortfall, energy from renewable sources will be further increased above its current 30 percent share. Oil derivatives contribute a mere 0.8 percent of Germany’s energy budget. This is positive news, as the black gold is a bigger part of our lives than many of us would expect. Take a moment to look away from this page, and let your gaze wander: CD cases, the paint on the walls, the case of your computer or smartphone, the kitchen work surface, those comfortable stockings, your TV and that pain relief gel – all of these and more are made using oil derivatives. I’m sure a great many more products will come to mind, but without crude oil, we’d have to forgo all of it. And that is why the men on the drilling platform off the coast of Brazil will continue working through all weathers to bring it out of the seabed. They work so that we remain mobile, don’t freeze, and can generally enjoy life as we know it.

Steel Giants: North Sea platforms are firmly anchored into the sea floor

Steel Giants: North Sea platforms are firmly anchored into the sea floor. Photo: BP



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