AI To Increase Oil Supply
Oil exploration has almost always been a difficult business. Locating promising areas to drill and then the odds of drilling in the correct spot may have become a science, but not an exact one. The same is true with the process of drilling. According to Viking Engineering, there are several related problems. These are “parted, cracked, or split, with percentages of 29%, 12% and 11% respectively in terms of the number of cases.” As human engineering skills reach their limits, AI may be the key to improving production and, thus, oil supply.
America —No.1 Oil Producer In The World
According to Bloomberg, “Now companies are increasingly using AI, machine learning, and remote operations to drill faster, suggest better ways to frack, and predict when active well pumps will fail.” The technology may be particularly helpful in fracking, where the breakeven costs of production are $50 or more. Fracking produces about two-thirds of US oil.
More efficient drilling means more supply in general. According to the EIA, in 2023, the US produced more crude than any nation in any other year. Four nations will account for most petroleum liquid production from 2024 to 2025. AI tools are available to all of them, and their effects will only improve.
Environmental Harm
While more efficient and increased oil production may harm the environment, they are certainly good for the economy. A large part of the daily costs of consumers and parts of some businesses are based on crude prices–primarily gas for cars, home heating oil, oil used by industries, and petrochemicals. As crude prices fall, many household budgets and business budgets benefit from higher margins. President Biden recently admired that oil production near terms is essential to a healthy global economy,
On the other hand, more efficient oil production almost certainly harms the environment in the near term. Environmentalists will need to hope that AI helps their causes as well.
