BP Hits Back at Claims the World is Running Out of Oil

BP has challenged predictions that world oil supplies are set to run out faster than expected by claiming new technologies will lead the way to further oil discoveries.

In BP's annual statistical review of world energy, released this month, the oil company argued against 'peak oil' theory and said present-day technologies and economics restricted present access to reserves.

According to peak oil theory, world consumption of oil will outstrip discovery of new reserves, a point at which it will not be possible to meet demand. While this does not mean world resources would have run dry, it does mark a point of rapid future decline.

UK-based organisation The Oil Depletion Analysis Centre (ODAC) debates these claims however. It says it believes global oil production is set to peak in the next four years before entering a steepening decline, having massive consequences on the world's economy.

ODAC member Chris Skrebowski says: "With most producers operating flat out to meet runaway demand increases this year, the world's immediately available spare production capacity has virtually disappeared.

"Even with relatively low demand growth, our study indicates a seemingly unbridgeable supply demand gap opening up after 2007."

In its statistical review, BP says the world still has enough oil reserves to provide 40 years of consumption at current rates.

Furthermore, the company emphasises that growth of modern technologies will further increase future oil discovery.

A BP spokesperson says: "BP believes that new oil and gas will continue to be discovered and existing resources will be more fully recovered for many years. In the short and medium term, the available resource base is constrained not by the actual existence of hydrocarbons but by technology and economics. The market will decide how much is economically recoverable, while new technologies will increase recovery factors and give greater access to challenging regions and geologies."

By Ozge Ibrahim