THE PETROLEUM CULTURE
151
OPEC producers account for 2/5 of this input and Persian Gulf
states is 1/5 of that amount with Saudi Arabia having the largest
block at 1.5 million barrels per day. Other large contributors are
Canada (1.9 barrels per day), Mexico (1.5 million barrels per day),
and Venezuela (1.4 million barrels per day). Iraqi oil could replace
any of these importers, but it would only become likely if there
was a major disruption like the kind that happened in Venezuela
prior to Operation Iraqi Freedom and recently in Nigeria (.5 million barrels per day US imports). In both of those cases, OPEC took
up the slack and continued providing the 2.5 million barrels per
day of Iraqi production. Most of the shortfall was covered by Saudi
Arabia. Realistically, Iraqi crude will find Asian and European markets with the US augmenting supply by courting it in negligible
amounts.
While most of the world's attention is on Iraq and the Middle
East, key events have occurred elsewhere that could affect markets
in ways that reduce the impact of the return of Iraq to the market. Canada, which vies for the major supplier to the United States
with Saudi Arabia at around 2 million barrels per day, increased its
reserves from 4.9 billion barrels by 175 billion barrels of bitumen (for
conversion to synthetic crude oil) from tar sand deposits. In terms
of heavy oil, overall increases in efficiency and industry advances
could add as much as 125 billion barrels to global reserves.
On the other hand, with proven reserves of 48 billion barrels,
Russia has once more entered the fray. The Druzhba pipeline
supplies oil to Europe and the aging terminal at Novorossisk on
the Black Sea is still a consistent outlet. However, civil unrest
has plagued the area since the fall of the Soviet Union and the
Bosphorus Straits is not the easiest water for large carriers to negotiate and may become restricted should the Turkish government
deem it. However, a pipeline bypass of the Bosphorus is underway
to carry Caspian oil from Baku to Ceyhan in Turkey. In addition,
Asia forms a ready market for oil from the Siberian fields and the
possibility of a pipeline to China and Japan has been considered.
In the meantime, China is seeking to develop its own heavy oil
fields.
5.4.2 Patterns of Use
The best-known model of oil production was proposed by Marion
King Hubbert, who proposed that the discovery, and production,
of petroleum over time would follow a single-peaked, symmetric
151
OPEC producers account for 2/5 of this input and Persian Gulf
states is 1/5 of that amount with Saudi Arabia having the largest
block at 1.5 million barrels per day. Other large contributors are
Canada (1.9 barrels per day), Mexico (1.5 million barrels per day),
and Venezuela (1.4 million barrels per day). Iraqi oil could replace
any of these importers, but it would only become likely if there
was a major disruption like the kind that happened in Venezuela
prior to Operation Iraqi Freedom and recently in Nigeria (.5 million barrels per day US imports). In both of those cases, OPEC took
up the slack and continued providing the 2.5 million barrels per
day of Iraqi production. Most of the shortfall was covered by Saudi
Arabia. Realistically, Iraqi crude will find Asian and European markets with the US augmenting supply by courting it in negligible
amounts.
While most of the world's attention is on Iraq and the Middle
East, key events have occurred elsewhere that could affect markets
in ways that reduce the impact of the return of Iraq to the market. Canada, which vies for the major supplier to the United States
with Saudi Arabia at around 2 million barrels per day, increased its
reserves from 4.9 billion barrels by 175 billion barrels of bitumen (for
conversion to synthetic crude oil) from tar sand deposits. In terms
of heavy oil, overall increases in efficiency and industry advances
could add as much as 125 billion barrels to global reserves.
On the other hand, with proven reserves of 48 billion barrels,
Russia has once more entered the fray. The Druzhba pipeline
supplies oil to Europe and the aging terminal at Novorossisk on
the Black Sea is still a consistent outlet. However, civil unrest
has plagued the area since the fall of the Soviet Union and the
Bosphorus Straits is not the easiest water for large carriers to negotiate and may become restricted should the Turkish government
deem it. However, a pipeline bypass of the Bosphorus is underway
to carry Caspian oil from Baku to Ceyhan in Turkey. In addition,
Asia forms a ready market for oil from the Siberian fields and the
possibility of a pipeline to China and Japan has been considered.
In the meantime, China is seeking to develop its own heavy oil
fields.
5.4.2 Patterns of Use
The best-known model of oil production was proposed by Marion
King Hubbert, who proposed that the discovery, and production,
of petroleum over time would follow a single-peaked, symmetric