Black gold might not be as scarce as we thought. This week oil prices escalated to a record $139 per barrel, but that may partly be because the amount of available oil in known reserves has been significantly underestimated.
So says Richard Pike, a former oil-industry adviser and chief executive of the UK Royal Society of Chemistry, who blames flawed statistical calculations.
Oil companies produce a bell-shaped probability distribution for how much each oil reservoir might hold, and then quote as an indicator of the reservoir’s capacity a figure they are 90 per cent certain they can exceed. When publishing…
