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Oil was traditionally measured in barrels. This might sound rather inaccurate, but the barrel is a very precise measurement!
The unit of the barrel can be traced back to Edwin Drake's original well. One barrel occupies 159 litres (35 UK gallons) and a typical barrel of crude oil weighs 0.136 tonnes. Natural gas is usually measured in trillions of m3 (1012 m3).
Reserves and consumption
The world's current (1996) proved reserves of oil are 1016.9 thousand
million barrels and of natural gas are 139.7 trillion m3. Proved reserves
of oil and gas are those in reservoirs from which it is known with reasonable
certainty that they can be extracted under current engineering and
economic conditions. Although oil and gas are being extracted all the time,
the proved reserves have actually been going up over the years. This is
because new reserves are being discovered and new technology makes it possible
to extract oil from previously uneconomic sources.
Prices
It is customary for crude oil and its products to be priced in US dollars. The price has fluctuated greatly from less than $10 per barrel to over $50 per barrel (at the 1995 value of the dollar) in the last 60 years. The price frequently reacts to political events such as the 1973-4 Arab-Israeli War and the 1991 Gulf War, as well as to the discovery of new reserves and the expected level of economic activity.
| Since 1989 new discoveries have more than kept pace with production. As a result, the world's total reserves have actually gone up rather than down. |