Thursday, July 15, 2010

US optimistic about Venezuela's oil reserves

They've considerably upped their estimates of Venezuela's reserves:
A new US assessment of Venezuela's oil reserves could give the country double the supplies of Saudi Arabia.

Scientists working for the US Geological Survey say Venezuela's Orinoco belt region holds twice as much petroleum as previously thought.
From the Beeb (h/t c1ue at iTulip). Now this wouldn't be a big deal, except for this little tidbit:

However, Venezuelan oil geologist and former PDVSA board member Gustavo Coronel was sceptical.

"I doubt the recovery factor could go much higher than 25% and much of that oil would not be economic to produce", he told Associated Press news agency.

Funny thing that. So is the US overestimating the reserves, or is Venezuela under-reporting them? And why? Don't know, but here's a few possibilities:
  1. One or both countries has simply made a mistake somewhere in their estimation process.
  2. Venezuela fears, rightly or wrongly, that the US will eventually go after them for their oil, and is thus talking down the amount of oil they have to reduce US interest.
  3. Venezuela and other countries want to talk down the amount of worldwide oil reserves so it will command a higher price.
  4. The US is itching to invade, and is talking up Venezuela's reserves to strengthen the case for such an action.
I'll leave it to the reader to decide which of these, if any, is the most plausible.