You wouldn't hear about it in the mainstream media, but the U.S. just increased its oil reserves by 3 billion barrels... overnight.
On August 1, the U.S. Energy Information Administration (EIA) published the official oil reserves for the U.S. It showed the largest-ever annual increase since it began publishing the data in 1977. That 3 billion-barrel increase beat the next-largest jump by more than 60%.
And this is just the beginning...
Since U.S. reserves bottomed in 2008, they're up 22.8%... But here's the thing: We're only looking at 2010 data.
The government takes about 18 months before it signs off on "official" reserve data. In the meantime, this trend has accelerated. Let me explain...
We can attribute a large part of the 2008-2010 increase to massive growth in the Bakken Shale. The Bakken Shale is an oil-soaked package of rocks that lies beneath 90 million acres of North Dakota, Montana, Saskatchewan, and Manitoba, Canada. It contains over 400 billion barrels of oil.
The oil is trapped in rocks that hold on to it tightly, unlike the traditional oil reservoirs. The industry struggled for decades trying to get the oil out. But as Growth Stock Wire readers know, new technologies have "unlocked" that oil, allowing it to be counted as part of the country's official reserves.
As recently as 2008, official reserve data for the Bakken showed just 3.8 billion barrels. According to industry sources today, we will probably get 24 billion barrels out. (That's nearly equal to official 2010 reserves for the whole country.)
We will not get the official 2011 numbers until next year... And this year's will take another 18 months.
But I promise you, those numbers are going to shock the world.
All this "new" oil will correspond with massive increases in production. As I showed you last week, we’re already seeing that.
That has me cautious on any investment that depends on a rising oil price. I'm more bullish on the small-cap stocks that are finding and drilling the next major sources of oil. I'll tell you more about what I see there in a future essay.
Good investing.
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