Incorporating Economic Forces into the Models of M. King Hubbert

prices and the annual rate of drilling effort in Hubbert's model of oil discovery, there is no evidence for claims that the secular decline in discoveries per foot of well drilled has been arrested or reversed in the lower forty-eight states. Our results indicate that there is little oil waiting to be found in unexplored sedimentary formations in the lower forty-eight states using conventional exploration techniques. Furthermore, we show that the declining quality of the resource base has offset the positive stimuli of price increases and changes in government policy towards a free market. Having passed through a period in which production in the lower forty-eight states fell 20 percent while real oil prices tripled, there seems little that the U.S. government can do to alter the bottom line for domestic operators so that U.S. production can displace imports to a significant degree. We conclude that the conventional supply side offers little room to manoeuvre around increased dependence on imported oil.

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