Contra all the comments to my earlier posts about the myth of depletion, it looks like rising oil prices actually are increasing the quantity of available oil. As I've explained many times, as oil prices rise, oil sources that were previously un-exploitable due to high costs become profitable.
The United States has an oil reserve at least three times that of Saudi Arabia locked in oil-shale deposits beneath federal land in Colorado, Utah and Wyoming, according to a study released yesterday. ...For years, the industry and the government considered oil shale — a rock that produces petroleum when heated — too expensive to be a feasible source of oil.
However, oil prices, which spiked above $70 a barrel this week, combined with advances in technology could soon make it possible to tap the estimated 500 billion to 1.1 trillion recoverable barrels, the report found.
Yes, oil will stay expensive, but prices will drop once refining processes are optimized and infrastructure is in place. It's simple economics: as price rises, so does supply.
(HT: Glenn Reynolds.)
All true, but you'll find, as you wander this ball of rock, that the two things least frequently comprehended by ordinary persons are 1) simple probability and 2) simple economics.
The problem on runs into however is if money is sunk into a place like Alberta to utilize its oil resources because its economically viable due to higher oil prices you run the risk of the State Owned oil companies like the Saudis and Chavez dropping the price of oil (because they have shown the ability to operate outside the realm of a free market structure) such that the Alberta project would fail to turn enough profit to keep it running and cover its capital costs. Above that the State Owned oil companys can take those kinds of risks because they don't need to make a profit they can just can just go Democrat and screw the public out of more of their own money to cover massive government programs.