MIT economist M.A. Adelman  has a solid article  in the current issue of Regulation , published by the Cato Institute . It’s entitled “The Real Oil Problem.” No one is better equipped to write on this subject.
Among the myths Adelman exposes is the one that shrieks “We’re running out of oil!”
First he points out that “reserves” is typically a shorthand term for the more technical term “proved reserves,” and any “well’s proved reserves are the forecast cumulative profitable output, not the total amount of oil that is believed to be in the ground.”
Then Adelman goes on:
But the “running out” vision never works globally. At the end of 1970, non-OPEC countries had about 200 billion remaining in proved reserves. In the next 33 years, those countries produce 460 billion barrels and now have 209 billion “remaining.” The producers kept using up their inventory, at a rate of about seven percent per year, and then replacing it. The OPEC countries started with about 412 billion in proved reserves, produced 307 billion, and now have about 819 left….. Growing knowledge lowers cost, unlocks new deposits in existing areas, and opens new areas for discovery. In 1950 there was no offshore oil production; it was highly “unconventional” oil. Some 25 years later, offshore wells were being drilled in water 1,000 feet deep. And 25 years after that, oilmen were drilling in water 10,000 feet deep – once technological advancement enabled them to drill without the costly steel structure that had earlier made deep-water drilling too expensive. Today, a third of all U.S. oil production comes from offshore wells.
He also reports on a recent study he did with Campbell Watkins  in which they could find no evidence that the process of finding new crude-oil deposits in non-OPEC countries, and developing these into reserves, is getting harder or more expensive: “Statements about non-OPEC nations’ ‘dwindling reserves’ are meaningless or wrong.”
He exposes other myths as well. It’s well worth a read.