VIENNA, Austria – The world has tapped only 18 percent of the total global supply of crude, a leading Saudi oil executive said Wednesday, challenging the notion that supplies are petering out.
Abdallah S. Jum'ah, president and CEO of the state-owned Saudi Arabian Oil Co., known better as Aramco, said the world has the potential of 4.5 trillion barrels in reserves — enough to power the globe at current levels of consumption for another 140 years.
Jum'ah challenged oil ministers and petroleum executives at an OPEC conference in Vienna to step up exploration "and leave the minimum amount of oil in the ground."
"The world has only consumed about 18 percent of its conventional potential," Jum'ah said, contending that should lay to rest fears that the world is in danger of being tapped out within a few decades.
Many experts estimate that the planet's recoverable oil resource is at least 3 trillion barrels and potentially more than 4 trillion barrels. If global consumption rises about 2 percent a year from today's levels of about 85 million barrels a day, they say, the low end of that range would only be enough to last until roughly 2070.
Rex W. Tillerson, the chairman of Exxon Mobil Corp. (XOM), said world demand for oil will increase by 50 percent in the next decade.
"When nations threaten to stop this flow, it stops economic progress worldwide," Tillerson said.
Industry leaders have gathered this week to take stock of new challenges at the conference sponsored by the Organization of Petroleum Exporting Countries.
Earlier this week, the 11-nation cartel agreed to leave its current production target of 28 million barrels a day unchanged, but made clear it would keep close tabs on falling oil prices and consider a possible cut in its output quota before the end of the year.
Crude prices have tumbled to five-month lows and have dropped by more than $12 a barrel since hitting record highs in mid-July. Analysts say a combination of ample supplies and an easing of political tensions such as the cessation of hostilities in Lebanon and progress in talks on Iran's suspect nuclear program have driven prices lower.
"When prices are high, passions can run high," Tillerson said. "Economic nationalism may gain in popularity" at the expense of developing global markets and the world economy, he said.
"The new era we face, like all of the previous ones, is not an era of easy oil — nor will it be an era of easy answers. But it can be an era of continued economic advancement," he said.
Jum'ah challenged explorationists to find enough new oil resources to add 1 trillion barrels to world reserves over the next 25 years, saying new technology and higher recovery rates would make it possible to hit that target.
Already, he noted, drilling is now going on as deep as 10,000 feet below the Gulf of Mexico and 7,000 to 8,000 feet elsewhere. Experts say a newly discovered petroleum pool beneath the Gulf of Mexico eventually could yield anywhere from 3 billion to 15 billion barrels.