U.S. now has larger oil reserves than Saudi Arabia, Russia

by WorldTribune Staff, July 6, 2016

The United States has for the first time surpassed Saudi Arabia and Russia in oil reserves.

A study by Rystad Energy estimates that recoverable oil in the U.S. from existing fields, discoveries and yet undiscovered areas amounts to 264 billion barrels. Saudi Arabia has 212 billion and Russia 256 billion in reserves.

Shale oil rig in Texas.
Shale oil rig in Texas.

“There is little potential for future surprises in many other countries, but in the U.S. there is,” said Per Magnus Nysveen, analyst at Rystad Energy, noting recent discoveries in the Permian Basin in Texas and New Mexico, which is the nation’s most prolific oil producing area.

“Three years ago the U.S. was behind Russia, Canada and Saudi Arabia.”

More than half of the U.S.’s remaining oil reserves are in shale oil, Rystad Energy data show. Texas alone holds more than 60 billion barrels of shale oil, the study said.

While U.S. producers have been able to cut the cost of pumping shale in half, to below $40 per barrel in some cases, Saudi Arabia and other Middle Eastern producers still pump oil for less than $10 a barrel.

“There is a sweet spot for conventional producers in OPEC. They want prices high enough to generate solid revenues to fund social spending in their countries, but not high enough to make too much expensive oil economically feasible,” said Richard Mallinson at London-based consultancy Energy Aspects.

Rystad Energy, based in Oslo, conducted the study of 60,000 fields worldwide over a three-year period. It shows total global oil reserves at 2.1 trillion barrels.