The oil industry provides the world with the power to do modern business, but could it also be a drain on the planet itself? It is the fuel that creates the energy we need to heat our homes, drive our vehicles, and even produce the products that are helping you read this content right now. How effectively is the world utilizing this natural resource?
Top Oil Industry Statistics and Facts
Oil and gas leases in the United States are near record lows, yet oil consumption is near record highs globally.
Part of the reason for this is the fact that an increased ability to discover new oil resources has been developed over the past decade. From 1988 to 1999, only about 2,000 drilling permits were approved per year. In comparison, over 7,000 drilling permits were approved in 2007, even though leases were approaching record lows. Since 2009, the average has been double that, despite near record lows.
3 Facts to Know About the Oil Industry Right Now
1. Exxon Mobil is the largest oil company based in the United States with over $450 billion in annual revenues. They’re ranked 2nd in the world, however, as Royal Dutch Shell has more than $480 billion in annual revenues.
2. The Top 20 oil companies have more revenues than the GDP of most African countries.
3. BP, which earns $386 billion annually, only realizes $25.7 billion in total profits.
Takeaway: When talking about billions of dollars in profits, the sense of what actual money is being made per every dollar spent gets lost in the figure. In reality, the oil industry makes just $0.15 on the dollar. These margins are much less than other industries, but other industries don’t have such a heavy reliance for life as the oil industry does. It could be argued, in fact, that without oil, we wouldn’t have life the way we do right now.
Other Facts About the Oil Industry to Consider
1. The first oil contract was secured by Standard Oil to drill for oil in Saudi Arabia in 1933.
2. The first American oil company was founded in order to harvest oil that was found floating on the water near Titusville, PA. This company later became Seneca Oil Company.
3. The first oil well in Los Angeles was discovered in 1892. In the next 5 years, over 2,500 more wells were discovered and more than 200 different oil companies were founded.
4. In the United States, the Federal Government owns over 12 million acres of land that produces oil.
5. Less than 2 million acres is leased in the United States for oil production.
6. It takes, on average, at least 180 days for an application to drill for oil to be approved in the United States.
Takeaway: The oil industry has been big money for a long time in the United States and the rest of the world. The need for American oil has, in fact, been responsible for the worldwide development of oil resources. After World War I, it was American efforts to explore the Middle East for oil reserves that created the foundation of the modern oil market. The real question to ask now is this: can we begin to develop alternatives for oil consumption? It may take decades to develop a feasible, alternative resource, but oil as far as we know isn’t a renewable resource. It’s a fossil fuel and that means eventually, if we don’t curb our ways, it is going to run out.