OPEC has Probably Deceived Us About the Size of its Oil Reserves By Kurt Cobb | Mon, 10 September 2012 22:58 | OPEC has Probably Deceived us About the Size of its Oil Reserves What do diamonds and oil have in common? Answer: The general public believes there is a limited supply of both. Those beliefs do not stand up to scrutiny. Diamonds are not only plentiful in nature they can be mass produced by man. And the oil in the ground is more than enough for the foreseeable future. That makes fuel refined from corn unnecessary. So why so many myths about diamonds and oil? The reason for the diamond myth is obvious. Rare jacks up the price. Oddly enough the sales slogan Diamonds Are Forever should lower prices because the cumulative effect flies in the face of scarcity. Think about it. Petroleum Nobody needs a diamond, but everybody needs petroleum one way or another. Since Oil Is Not Forever amounts to false advertising, a variation of the diamond industrys pricing mechanism was called for. Basically, petroleum pricing depends upon consumers believing the world will run out of oil in the near future. The best way to sell the idea of future scarcity was to show where oil came from. An animated story on TV showing how petroleum reserves originated helped sell the idea of a finite resource. A graphic presentation illustrating dinosaurs melting away and seeping into the ground forming huge pools of oil used to be final word on petroleums origin. Sinclair Oil even used a dinosaur in its advertising: The dinosaur myth had but one purpose. Scarcity in the future justified higher prices today since the world is not likely to see dinosaurs again. NOTE: I always thought the dinosaur story was absurd. I was partial to vegetation being the raw material that produced petroleum. Decaying vegetation combined with insect poop eventually squeezes out petroleum under gravitys constant pressure made more sense to me. Petroleum aside, engage your imagination with a bit of speculation concerning the much ballyhooed dinosaurs; now extinct: The theories surrounding the demise of dinosaurs always fascinated me. Well, Im happy to announce that well-liked assumptions about dinosaurs have been discredited at least in my mind. A few years ago I heard a brief news story on my car radio informing me that a baby dinosaur had been found inside a mammals stomach. I think the report said that the hungry mammal was about the size of a squirrel, or somewhere in that neighborhood. Stay with me on this. After hearing the news blurb it was instantly clear to me that, over a period of thousands of years, mammals snacked on baby dinosaurs until finally there were no more pro-life grownups left to reproduce their kind. Another factor to consider is size. Obviously, dinosaurs were equipped to do battle against other heavyweights. I doubt if they could defend against legions of ravenous mammals. My point: Legislators should think twice whenever fortunetellers demand that an endangered species be saved. The species you save might multiply and eat your descendants. Now lets go to the philosophical: Its generally agreed that dinosaurs did not possess a sharp wit. If Im interpreting the aforementioned discovery correctly its fair to say that dinosaurs werent into maternal instincts either. Go one step further and say that dinosaurs disappeared because they did not protect their offspring, while mammals thrived precisely because of maternal instincts. Go even further and say that the fate of dinosaurs is Gods way of telling us Protect your children or youre history. Now lets go to pseudo-science and fossil fuel politics. Environmental freakazoids woke up in wacko heaven when displaced Communists flocked to the environmental cause after the Soviet Union collapsed. An influx of Communist true believers quickly made petroleum and coal the villains. Wind, sun, and alcohol refined from plants became gods to tax dollar hustlers like Al Gore and the nincompoops who believed him. New battle lines were drawn when the Cold War ended. With a lot of support from the United Nations an army of tree-huggers who truly believe they are saving the planet mobilized faster than Americans mobilized for WWII. Media and the education industry became prophets of doom warning that something had to be done even if it meant reducing the lower economic classes to primitive living conditions. Ill close with a dubious statistic from Kurt Cobbs article: I am curious as to why OPEC inflates the amount of oil reserves it controls? De Beers sure as hell does not jack up the accepted number of raw diamonds in the world. It seems to me that converting 81.3% to actual barrels of oil would decrease the accepted amount of known reserves. That should increase the asking price. Just to be clear, pricing and marketing are incidental to the politics involved. There is no shortage of petroleum, nor will there be a shortage for a thousand years if ever.