America and the world are running out of oil, right? That's what the Peak Oil voices have been telling us for three decades? So why are there more known producable oil reserves today than 30 years ago?
Chevron CEO John Watson knows the answer, and explains it in detail in an interview with The Wall Street Journal's Kim Strassel:
"In theory, he says, 'we've been running out of oil and gas for a long time,' yet technology creates new opportunities. Mr. Watson cites a Chevron field long in decline down the road in Bakersfield—to the point that for every 100 barrels of oil 'in place,' the company was extracting only 10 or 20.
"But thanks to a new technology called steam flooding, Chevron is now getting 70 to 80 barrels. 'Price creates incentive, and energy will be developed if there's demand for it at the price you can develop it,' Mr. Watson says. In that sense, 'oil and gas are plentiful.'"
And that is why, according to Watson, "the world's proven reserves of oil and natural gas increased 130%, to 2.5 trillion barrels," Strassel writes.
There's much more in Strassel's interview with Watson, which you can read here.