From the gas station attendant in Iowa City to Russian President Vladimir Putin: the daily price of oil is a common concern for billions of people all over the world.
Yet Spencer Dale, chief economist of British oil company BP, isn’t worried. Instead, the 50 year-old expert insists on viewing crude oil – perhaps today’s most scrutinized natural resource – in the context of larger cycles of 20 to 30 years.
And while he may not have a crystal ball, he does have his reasons, many of which center on a recent report compiled by BP on the future of the world’s energy resources. In it, the authors state that around 2.6 trillion barrels of petroleum could potentially be extracted using today’s technology.
“That’s enough to satisfy the entire global population until 2050 – twice over,” says Mr. Dale optimistically. In other words: there’s no petroleum shortage. Rather, the world is swimming in oil. And while the oil price bounced back from last year’s 12-year low to currently $55 per barrel, Mr. Dale said he doesn’t expect prices to rise much higher in the long term.
As a result, he concludes, many high-cost projects will take decades to return a profit, or will never be viable at all. Low-cost producers including various countries in the Middle East, Russia and even parts of the United States “are likely to produce more and more oil and push down prices to force producers with higher costs out of business,” the expert explained.