Nonrenewable resources, such as oil or copper, will never run out, despite popular belief.
The famous misconception of Dr. Pangloss, a character in Voltaire's satirical novel Candide, is that we live in the best of all conceivable worlds. If you have a pessimistic slant, you might consider “Panglossian” an apt descriptor for those of us who endlessly chant about progress. To avoid Panglossianism, any good herald of progress keeps two thoughts in their head at once: the world has plenty of problems, but it is also getting better.
We die, but later than we used to. A smaller and smaller share of the world’s population is illiterate, undernourished, or extremely poor. People in almost every country are less likely to die from tuberculosis, diarrhea, and other maladies that ravaged humanity for millennia. Even war deaths and homicides seem to be on a long-term decline (with a handful of countries like El Salvador, Honduras, and Venezuela bucking that trend).
The word "possibilist," coined by the late Hans Rosling, is a better descriptor for individuals who acknowledge that we live in an imperfect but improving world. "Someone who neither hopes without reason, nor worries without reason, someone who continuously fights the overdramatic worldview," wrote Rosling. Even still, skeptics are irritated by such confidence.
One recent accusation of Panglossianism comes from two eminent evolutionary biologists, Heather Heying and Bret Weinstein. In the newly released A Hunter-Gatherer’s Guide to the 21st Century, they attack “Cornucopianism,” the economistic assumption that resources aren't finite and that limitless growth is feasible. They contend that "the great bulk of Earth's resources are limited." "Everything is finite, from rubber to wood to oil, copper to lithium to sapphires."
This idea is unfortunately common. In Human Race: 10 Centuries of Change on Earth, a book that I reviewed this summer, the prolific British historian Ian Mortimer argues that it is a certainty that oil will run out. Because we’re exploiting the black gold so ruthlessly, he writes, “it will run out at some point in this current millennium, there is no doubt about that; it is just a matter of when.” (Emphasis added). Both these notions are wrong – or at least seriously overstated.
According to the latest BP Statistical Review of World Energy, the world’s proven reserves of oil totaled 1,732.4 billion barrels last year. During 2019, the most recent pre-pandemic year, the world consumed about 31 billion barrels, meaning that we have just shy of 56 years of proven oil stocks left – a little less if oil consumption were to keep rising with its historical trend. By that logic, Mortimer is being conservative; oil will run out this century.
That's not the case. We utilized 25.2 billion barrels of oil in 2000, out of 1300.9 billion barrels of known reserves (52 years of supply left). Even though we now use around 25% more oil than we did in 2000, we still have 56 years of supply left. Humanity has used a lot of oil in the previous two decades, yet oil has gotten increasingly plentiful. How is that possible?
While the total amount of oil in the ground doesn’t change very much from one year to another, three more important things do:
- How much oil we know about.
- How much of that oil we can technically extract.
- How much of that oil it is economical to extract.
These three factors alter throughout time, and this makes a significant impact. We discover oil in regions where we had no idea it existed, and new technologies make previously inaccessible deposits accessible. Furthermore, when oil becomes more scarce, its price rises, motivating decreased use and higher supply. The "cornucopian" conclusion follows as long as prices are free to represent economic reality: oil will not run out before it becomes outdated.
A late-nineteenth-century whaler could have made the same argument as Mortimer. Whales are finite resources. They reproduce slowly. Given humanity’s greed, want for light, and ever-faster whaling ships, Moby Dick doesn’t stand a chance. His kind will perish sometime next millennium.
Except, of course, reality played out very differently. Today, almost all species of baleen whales on the IUCN’s Red List are several rungs above Critically Endangered (most are on the LC – Least Concern – rung), and all but two species of Right Whales are increasing. Humpbacks, those majestic creatures that astonish tourists in every ocean, may have surpassed their pre-industrial numbers, according to research reported on in Time Magazine.
What happened was that new inventions outcompeted whale oil for fuel and lighting, and consumer demands – and wealth – changed, so much so that almost every country has banned the hunting of whales.
The Cornucopia of raw materials
Copper, silver, tin, and wood are finite raw resources. As a result, pessimists worry that they will eventually run out. However, this conclusion is incorrect. Physically, raw materials are limited, but economic resources are limitless. This is due to the fact that economic value is not inherent in the physical thing. Value, on the other hand, is subjective, existing only in the imaginations of customers and in the outcomes they pick. In other words, a given quantity of material may yield an endless amount of value.
Andrew McAfee from MIT showed that we can get more from less. The number of atoms may be fixed, but those atoms can be combined and recombined in an infinite variety of ways, allowing us to satisfy our needs and desires in ways that are better, faster, cheaper, and less wasteful. Furthermore, there is no limit to how much we can specialize or restructure our labor, production, and consumption.
Materials can also be re-used. Almost all the copper that humanity has ever extracted from the Earth (some three trillion tons or so) is still with us – in the buildings that shelter us, the wiring that moves our electricity, the equipment that entertains us, and the servers that power and store our digital lives.
We have hundreds of years of uranium reserves left and even more of coal. The known deposits of bauxite, the ore from which we extract aluminum, will last for hundreds of years at current use. Or perhaps even longer than that. When raw materials become too “scarce” and, therefore, too expensive, we will switch to using something else to power our civilization. While there is some final quantity of oil and other raw materials in the ground, market prices and technological improvements will ensure that we will never use them all. They will last forever.
Heying and Weinstein’s “Cornucopianism” charge may be countered by another word, a more empirically sound and researched one: Marian Tupy and Gale Pooley call it “Superabundance” – “a condition where abundance is increasing at a faster rate than the population is growing.” They show that 50 common raw materials have become less scarce over the last forty years when we adjust for inflation and increases in income.
Contrary to concerns of scarcity, it appears that more people and economic expansion enhance mankind rather than harm it. Despite the fact that the world now has a lot more people fighting for the same resources, we have more raw materials than we had twenty or forty years ago. This is a feature, not a glitch or an oversight.
When we properly consider the power of market prices to ration resources, our ability to uncover substitutes, and the history of technological change, a very counterintuitive conclusion emerges: non-renewable resources, like oil or copper, never run out.
That may not be the best of all possible worlds, but it’s a lot better than most people think.