Technology is reinventing established oil fields and drastically increasing the amount of oil thought to be accessible in the world, according to a report from The New York Times.
“It looks like the peak oil theory peaked with $78 oil, last August,” said Daniel Yergin, Associates Chairman at Cambridge Energy Research, to “Squawk Box.”
Giving the example of the Permian Basin, a giant oil field in the U.S., Yergin said that “Estimates for ultimate recoverable revenues are twice what they were in the 1980’s and it’s not that there have been any major new discoveries, but they are getting so much more oil out of existing fields because technology has really advanced.”
More technology means higher costs however and making a viable business out of extracting oil from harder to reach places is far from guarantied profit. Yergin told CNBC that a price floor of $40 a barrel would be needed to overcome the technological and geopolitical challenges, adding “More oil doesn’t mean its all easy oil.”
Cambridge Energy Research estimates that 3.7 trillion barrels of oil are still available and 1 trillion barrels have currently been used.
More oil means more pollution but Yergin thinks that oil consumption will become a efficient in the future.