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OPEC representatives reached a landmark deal to reduce oil output, propelling crude prices more than 8% after months of wrangling and market uncertainty about the ability of the once-mighty group to strike an agreement.

Looks like good news to me, a fragile handshake deal among a dozen or so members and Russia. No great threat to energy supplies, since cartels are inherently unstable and OPEC only controls a third of global production. But a spike in prices should encourage alternatives, like cleaner natural gas and renewables.

Forget about Peak Oil, people are now talking about Post Oil. Nine years is plenty of time for OPEC's resolve to wither and today's $50 barrel to drop to the mid-30s, suiting my purposes.

Meanwhile, USGS Estimates 20 Billion Barrels of Oil in Texas’ Wolfcamp Shale Formation, "nearly three times larger than that of the 2013 USGS Bakken-Three Forks resource assessment, making this the largest estimated continuous oil accumulation that USGS has assessed in the United States to date."

The Fine Print

However, the fact that the assessment refers to the “resource” means that they are estimating the technically recoverable oil in place. This says nothing of the economics of recovering this oil. The amount that would be economically worthwhile to recover at prevailing commodity prices — which would be classified as “proved reserves” — will be a smaller subset of the assessed amount. It would even be zero at a sufficiently low oil price. This is merely an attempt by the USGS to estimate the amount of oil that could be extracted over time if cost was not a concern.