Don Luskin is continuing to fact check Krugman. He just nailed him on a non-correction correction regarding some claims he made regarding the world's oil supply.

Even if he had made the noted correction in an appropriate manner, it still would have been woefully lacking. Why? Because it doesn't address the fundemental dishonesty of Krugman's original statement. He chose his formulation, "no major oil field have been found", with care to support his contention of dwindling oil supplies. However, even if those new fields in Kazikstan didn't exist, he would still not have a leg to stand on. In typical Krugman fashion, instead of changing his position (or just finding something else to write about) he instead finds a way to try to twist the facts to support his Bush bash de jure.

Why talk about discoveries of "major oil fields" at all? Who cares? Why not talk about the relevant figure (and thus the usual measure used when discussing the issue) of proven oil reserves, or estimates of total recoverable oil? Could it be because if he used this data he wouldn't have had a column left? Instead of falling, oil reserves increase just about every year, and have done so for the last 100+ years. As one of Luskin's readers earlier noted, Saudi Arabia alone has recently revised it's estimate of recoverable petroleum from 261 billion to 1.2 TRILLION! (Though I have to say that a significant degree of caution is in order regarding the 1.2 trillion figure.)

In 2002, after consuming ~ 1.5 billion barrels of domestic oil, US proven reserves INCREASED from 22,446 million barrels to 22,677 million barrels. While we "only" discovered 300 million barrels of oil in new fields, expanding existing fields added over a billion barrels. This is the typical reason reserves increase, not from "major new fields", but from new discoveries of oil in existing fields, and more efficient methods of extracting it.

Finally, all those who claim the Mad Max world of no fuel is on it's way have always conveniently ignored the non-conventional sources of oil that are excluded from reserve estimates because of the (currently) prohibitive costs of extraction. If prices rose sufficiently due to supposed scarcity of current oil reserves, the Venezuelan Orozco belt of "heavy oil" estimated at roughly 1.2 trillion barrels would be much more attractive. The estimated 2 trillion barrels of oil - in the US alone - locked up in shale deposits would also become profitable to mine.