At today’s average oil price of $60 per barrel for Brent crude, that’s $5.8 billion consumed. Every. Day.
The top three oil consumers—the United States (20%), China (13%), and India (5%) account for more than a third of the world’s consumption. Of those three, only the United States is a major oil producer. Saudi Arabia and Russia, who are two of the three top oil producers in the world, rank #5 and #6 when it comes to consumption.
But that’s just the current daily average based on EIA data from 2016. Today, estimates are that we are chewing through 100 million barrels per day or more. But that hasn’t always been the case.
According to BP’s Statistical Review of World Energy, consumption has been on a steep uphill trajectory for decades, starting at about 40 million barrels per day consumed in 1969.
That’s the average daily rate. Annually, global consumption is even more impressive, reaching 36.4 billion barrels consumed in 2018, according to BP. That’s $2.184 trillion worth of oil consumption in a single year. In gallons, the world’s annual consumption is 1.134 trillion—roughly half the amount of water found in Lake Michigan.
Looking at the total consumption by decade, consumption has increased from almost 200 billion barrels in the ‘70s to nearly 350 billion barrels over the last decade.
All told, from 1969 to 2018, a fifty-year span, the world has consumed 1.306 trillion barrels of oil.
But what about the period before 1969? That data, while certainly less significant in the grand scheme of things because we’re talking about significantly less volume, is harder to track down. For the early years, production data is easier to come by, which is a reasonably fair substitution for consumption since you can’t consume what you didn’t produce, and producers wouldn’t produce barrels that are not being consumed.
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From 1950-1969, world oil production totaled 151.4 billion barrels. In 1950, total world oil production was 3.8 billion barrels—just over 10 million barrels per day. To compare this with current production rates, the US, Saudi Arabia, and Russia each produce more than that.
Total estimated world oil consumption, from 1950 to 2018, then, is estimated at 1.457 trillion barrels.
But what about before 1950?
Unfortunately, the world’s record-keeping ability was a bit inferior to today’s methods. Not every producing country kept good tabs on the amount of oil it pumped out of the ground, and even fewer countries kept good records on how much oil it consumed. For this reason, estimates for how much oil the world was consuming prior to 1950 vary wildly. And clearly, the record-keeping ability is worse the farther you go back in history. And to figure out how much oil the world has consumed, you’d have to get into your Way Back machine to 1850.
Hungarian Academy of Science Theory
In 2008, a pair of chemists from the Academy of Sciences estimated that the world had pumped 100 billion tonnes of crude. This equates roughly to 733 billion barrels of oil. We can assume that this estimation including production through 2007. From 2008 to 2018, the world has used an additional 371.2 billion (BP), which would bring the total oil used since the beginning of time to 1.104 trillion—below the usage of 1.457 trillion barrels in the calculations above, derived from multiple sources.
The discrepancy in how many barrels that the world has consumed to date indicate that no one really knows for sure just how many barrels have been pumped out of the ground.
But using the estimates above, if we’ve used somewhere between 1.1 trillion and 1.5 trillion barrels of oil since the beginning of time, what’s next?
Oil Demand Growth
Oil demand growth is set to slow in the coming years. But slowing demand growth doesn’t mean zero demand growth, and cries of “peak oil” are still nowhere in sight. So while the world may be using 100 million barrels per day right now, oil consumption, according to the EIA, is expected to grow by an average of 1.1 million barrels per day in 2019. In 2020, the growth is expected to be 1.4 million barrels per day. These forecasts are adjusted often, however, and demand growth projections have been revised downward in recent weeks as analysts predict weakening economies and therefore demand stemming from the US/China trade war.
OPEC has estimated that demand will grow by 7.3 million bpd from 2019-2023, and 14.5 million bpd from 2019 through 2040. This means that by 2040, the world will be using almost 42 billion barrels per year.
To compare this to how much oil the world has left in reserve, as of 2018, the world has 1.497 trillion barrels of oil, according to OPEC, with 79.4% of those reserves held in OPEC countries, and 64.5% of OPEC’s reserves are located in the Middle East. Venezuela and Iran—two sanctioned countries—together hold 30% of OPEC’s reserves. Nigeria and Libya—who also have had security risks that have hindered production--hold another 5%, This puts 35% of the world’s oil at risk of staying in the ground.
But while OPEC holds the lion’s share of the world’s oil, over the next decade, most of the new oil supply will come from the United States.
