I spent a lot of time in 2015 warning that at year-end we would see a huge decline in crude oil reserves. As I have explained in the past, the reason I expected this is because of the relationship between proved oil reserves and oil prices. This relationship is important for understanding oil reserves. Some articles that recently began making the rounds made certain conclusions from this paper — A global energy assessment — in which some subtleties about oil reserves have been lost. So let’s review. An oil resource refers to the total amount of oil in place in a particular area. Generally, most of a resource can’t be technically recovered, but the resource refers to the amount that could potentially be recovered. These estimates can go up and down, but the resource is what could be recovered at 100 percent recovery based on current […]