Submitted by EnergyTechStocks.com

It is an accepted fact on Wall Street that the higher oil prices go, the more oil the world should be able to produce, as expensive new oilfields, and marginal old ones, become financially viable. Indeed, this is the core reason why many oil analysts believe that oil prices will go lower over the long run.

Wall Steeet’s got it wrong, says Mark Bunger, research director at Lux Research, the noted technology research firm. According to Bunger, no matter how high oil prices go, global oil production won’t significantly rise if today’s technology continues to be used. “There’s no way to get more (oil) with the same technology,” Bunger told EnergyTechStocks.com in an interview.

To make matters worse, Bunger said, oil companies are spending a “preposterously small amount” of their multi-billion-dollar revenues on developing new technology to extract more oil and to reduce the current skyrocketing costs of production, thus making it hard to imagine how global output has any chance of rising above 100 millions barrels a day (vs. about 85 million currently) over the next few years in order to meet expected demand.

“I hate to sound alarmist, but people need to understand the way things really are,” Bunger said.

Bunger blamed the situation on oil company “culture,” explaining that Big Oil has never needed to spend a lot on technology because it’s always been political access that has paid off for them in terms of producing more oil. With Big Oil now all but locked out of the world’s remaining oil reserves, Bunger said international oil companies “are in an incredibly tough spot. Research and development is their only way out, but they haven’t figured that out yet.”

Lux Research recently published a report on how nanotechnology is key to raising oilfield production while simultaneously lowering operating costs. He said that while it’s impossible yet to know by how much overall oil output might rise with nanotechnology, there are nanotechnologies ready to go today that could improve oilfield technology, which in turn would enable drillers to get more bang for their buck. More on all this next week in an EnergyTechStocks.com Special Series.