Almost sounds like she's singing "Gasoline, We'll be free, we'll be free"

 

hippie

JIM BUCKEE: I think it's pretty alarmist if one or more of the worlds largest oil companies say, listen guys, supplies of oil are gonna get tight.

 

Wrong word. Merriam-Webster's Collegiate Dictionary, Tenth Edition: "alarmism; the often unwarranted exciting of fears or warning of danger."

A better choice would have been "alarming."

 

JIM BUCKEE: I don't think that really we've seen any rationing of consumption by price. We did see it in '79, '80 and that was largely because of the sudden quadrupling of the price of oil. Now we've seen a relatively gentle approach and people have accommodated it.

 

"Rationing of consumption by price" really means "Robbing the poor for the benefit of the affluent." It puts transportation out of reach for poor people, especially in places where alternatives to driving are scarce (much of the country), while assuring convenient, abundant fuel supplies for the folks I see on the interstates, driving alone in their full-sized two-and-a-half-ton SUVs at 80mph.

 

 

 

The plant, which would be among the first of its kind in the nation, would use a technology perfected in Nazi Germany to turn coal into synthetic fuels, including jet fuel for use by the Air Force.

 

This falls in line with predictions that as energy becomes critically scarce and costly, nations will squander large amounts of it fighting for control of the sources.

 

"President Bush urged OPEC nations on Tuesday to put more oil on the world market and warned that soaring prices could cause an economic slowdown in the United States." - Opening quote from Jan 15th article

 

Mr. President bush, this is not a solution, or a band-aid, or even a reasonable freaking request.  If you see a looming economic crisis, shouldn't you be spending you time finding ALTERNATIVES?  Just a thought.

"Rationing of consumption by price" really means "Robbing the poor for the benefit of the affluent." It puts transportation out of reach for poor people, especially in places where alternatives to driving are scarce (much of the country), while assuring convenient, abundant fuel supplies for the folks I see on the interstates, driving alone in their full-sized two-and-a-half-ton SUVs at 80mph.

 

I don't see it as robbing the poor, at least not financially. Your next sentence better describes how the poor would be robbed -- of transportation. Many poor Americans have long been robbed of their mobility, and this robbery will extend to the working class and even middle class as fuel prices continue to climb to cause equilibrium between rising demand and falling supplies.

"President Bush urged OPEC nations on Tuesday to put more oil on the world market and warned that soaring prices could cause an economic slowdown in the United States." - Opening quote from Jan 15th article

 

Mr. President bush, this is not a solution, or a band-aid, or even a reasonable freaking request.  If you see a looming economic crisis, shouldn't you be spending you time finding ALTERNATIVES?  Just a thought.

 

  The only way to save our rear ends is to shift government policy toward promoting energy efficiency (it's cheaper to save energy than to buy it), shift transportation spending more toward rail and transit, and discourage energy-intensive development patterns. 

 

The Bush administration doesn't get it and they never will.  They are wholly incapable of thinking outside the box.  Unfortunately, the Democrats are equally clueless, except that they would do a marginally better job of funding rail and transit. 

 

It's going to take the country experiencing a lot of pain for them to wake up. 

http://energytechstocks.com/wp/?p=819

 

‘Dean of Oil Analysts’ Maxwell (Part 1 of 4): Oil Shortages Start in 2010; Peak Oil Hits 2012-2015

 

Posted: February 4, 2008

 

Nearly 40 years on Wall Street, plus 12 years before that working for a major oil company, equals a lifetime of experience for Charles T. Maxwell, senior energy analyst at Weeden & Co., known as the “dean of energy analysts.” Now, in an interview that sounded like a preliminary draft of a valedictory address, Princeton and Oxford-educated Maxwell has laid out in stark, uncomplicated terms what might be called the “Nightmare on Main Street” that he sees barreling toward America and the world.

Worth reading, but probably more appropriate in this thread....

 

http://www.urbanohio.com/forum2/index.php/topic,14971.msg254086.html#msg254086

A very well thought-out article......

_________________

 

http://www.associatedcontent.com/article/575837/as_oil_majors_chime_in_the_reality.html

 

As Oil Majors Chime In, the Reality of Peak Oil Lurches Closer

By Robert Fanney, published Feb 04, 2008

 

One by one, the world's oil companies are coming out of the closet. For years operating under the assumption and public assertion that world oil supplies were plentiful and would be for years to come, now many of the world's most powerful and well known oil giants are talking about scarcity or, even, the dreaded peak in world oil supplies.

 

For the uninitiated, Peak Oil is not the point where oil runs out but where it becomes physically impossible to grow the amount coming out of the ground and onto the world oil market. For all intents and purposes, Peak Oil is the top of the curve beyond which world oil production goes into inexorable decline. With a world economy largely dependent on oil for transportation, chemicals, and a range of synthetic products, even a plateau in world oil supply spells trouble.

Those of you who follow the world-wide geo-political and oil situations may already be aware of this, but Iran has declared their intentions of pricing their oil in non-dollar currencies starting as soon as this feb 11th (the anniversary of their revolution); but due to the numerous (5) underseas internet cables being cut (coincidence?) over the last week that has left most of the middle east in the dark (except for Israel and Iraq) it has been extended to the 16th. This "Iranian Oil Bourse" threatens the very core of our American economic empire; if countries are no longer required to pay for oil in dollars (the sole remaining reason why the dollar is the world's reserve currency) our currency will simply collapse and the Great Depression will look like a fender-bender compared to what's in store for us. Our govt will not allow this, just like they didn't allow Saddam Hussein to do this (6 mos before we invaded Iraq). If other oil-producing countries were to see the Iranians get away with this, they would follow suit quickly, as they would be quick to dispense (dump?) depreciating US dollars in exchange for Euros/yen/etc.

If you still think we're going to bomb/invade Iran because they're 'developing nuclear weapons', think again. This is all about preserving US economic dominance by any means necessary; If you like the current wars and want more of them, you're not going to be dissappointed. If you oppose this nonsense and the economic peril these people are about to bring us, I strongly suggest checking out Ron Paul and what he stands for.

 

Expect to see action taken sooner rather than later. And buckle up.

 

www.energybulletin.net/12125.html

 

^Iran already claims that a sizable portion of their oil sales are in currencies other than the dollar (I forget the percentage, but it's not insignificant).  Iran isn't the only nation pushing for this, either.  So are a few other mid-East countries, Venezuela, and Russia.  Russia is being a lot quieter about it and pushing it behind the scenes.  So, the dollar link to oil is already beginning to break. 

 

The unfortunate reality is that the dollar is already collapsing due to the fiscal mismanagement of the Administration and their allies in Congress.  In early 2006, the Fed announced that they would no longer publish the "M3" figure-- which is the total amount of dollars in circulation.  They would never admit it, but the reason is that the Fed has been printing money like crazy.  If the world knew the truth about how many dollars are in circulation, it would hasten the dollar's collapse.  And, it's not just oil that's internationally priced in dollars, it's precious metals, minerals, and even steel. 

 

It's also not easy to admit, but we have no one to blame but ourselves for the precariousness of the dollar-- regardless of what Iran is doing.  Nixon took the US off the gold standard because several countries saw what was happening with our fiscal situation during the Vietnam war (our trade gap was widening and we were taking on debt to pay for Vietnam) and they wanted to exchange their dollars for gold and silver.  Our currency system was set up so that it was obligatory to exchange dollars for gold and silver when requested.  Nixon refused-- which means he essentially forced the country into default-- then he took us off the gold standard and convinced OPEC to price oil in dollars which would force other countries to maintain dollar reserves. 

 

Rather than deal with the root causes of our trade and budget deficits, we, as a nation, chose to live on credit and prop our currency up with oil sales knowing full well that it wasn't a real, permanent solution.  Then we chose to further hasten the decline of our economy by embracing NAFTA and the WTO-- Ross Perot was right about "the giant sucking sound". 

 

We've made all the same mistakes that empires in the past have made: financialization of the economy and allowing our manufacturing base to evaporate, militarization of our foreign policy, and massive indebtedness-- both public and private. 

 

Now that we're in this precarious financial situation, we're vulnerable.  And, once the dollar peg to oil is broken, you can bet that other commodities will follow, and that's what really will ruin the dollar.  Oil sales account for no more than about 10% of dollar transactions.  You add in the other commodities, though, and it adds up in a hurry. 

 

The thing other thing that is hastening our decline and reducing our global influence more rapidly than anything is our neo-imperialist global agenda.  We've taken on a belligerent, self-righteous foreign policy since the fall of the Berlin Wall (which has gotten much worse under the current administration);  and our empire of 740+ overseas military bases which is making more enemies than it is friends.  To get a good picture of what I'm talking about read the following books: Blowback, The Sorrows of Empire, and Nemesis: The Last Days of the American Republic by Chalmers Johnson. 

 

Some other good ones that speak to some of the issues related to the above are:  Sleeping with the Devil: How America Sold Its Soul for Saudi Crude by Robert Baer (a former CIA agent who worked in the Middle East for 22 years); Confessions of and Economic Hitman and The Secret History of the American Empire by John Perkins; Three Billion New Capitalists: The Great Shift of Wealth And Power to the East  by Clyde Prestowitz

Confessions of and Economic Hitman

 

That's a fun book. I read that.

Gildone, I agree with everything you said; my point is we are thisclose to war with Iran, and it has nothing to do with their nuclear program; just like our invasion of Iraq had nothing to do with wmd's...Saddam had started to do the exact same thing and wouldn't back down. Now he's gone. The Saudi's know if they try this, we will remove them too (this was covered in Confessions of an Economic Hitman) I'm just trying to expose this to those of us on the forum who don't necessarily follow geo-politics as closely as some of us; and that this relates to the people running for president and their policy positions.

Again, I'll reiterate: If you want 'more wars' (McCain) and endless occupations overseas, and the financial ruin that is quickly approaching because of it....vote for McCain, Huckabee, Clinton, or Obama. They are all in the same boat on these issues.

If you oppose more war and the continuing depreciation of the dollar, vote for Ron Paul.

 

There really aren't any issues that are more important or pertinent to this nation right now than these 2, and we need to approach this election accordingly.

Inform yourselves, and spread the word.

Great words posted at peakoil.com about the above article:  "This reminds me of Monty Python's 'Life of Brian' where the main character is being crucified and starts singing -- 'Always look on the bright side of life.'"

 

If you oppose more war and the continuing depreciation of the dollar, vote for Ron Paul.

 

 

Or Mike Gravel, that is if he is even still in the race.  The guy never had a chance.  He refused corporate campaign contributions and PAC money and he wasn't already somewhat familiar on the college lecture circuit like Ron Paul.  As far as personal freedoms, I tend to be libertarian, but I don't agree with all the market worship in libertarian economic beliefs.  Still, my protest vote may be to declare myself a Republican in the upcoming primary and vote for Ron Paul, even though I know he would do nothing meaningful about the transportation and land use issues we care about on this forum. 

 

Mandatory Peak Oil content:

 

 

Peak Oil: Simmons v. Saudis, Round Two

http://blogs.wsj.com/environmentalcapital/2008/02/12/big-peak-oil-debate-redux/

Neil King, Wall Street Journal (Environmental Capital blog/column)

 

Both Nansen Saleri, former chief of reservoir management at Saudi Aramco, and Houston-based investment banker Matthew Simmons are feeling good these days about the famous-and weighty-debate they held four years ago at Washington’s Center for Strategic and Security Studies.

 

Are Saudi Arabia’s massive oil fields in great shape-or falling apart? Can Saudi Aramco help slack the globe’s soaring energy thirst far into the century-or has that ability already peaked?...

 

 

 

 

World Oil Forecasts Including Saudi Arabia, Kuwait and the UAE - Update Feb 2008

 

http://www.theoildrum.com/node/3623#more

 

http://img229.imageshack.us/img229/6818/0tod2008forecastac4.jpg

 

World total liquids production (Fig 1) remains on a peak plateau since 2006 and is forecast to fall off this peak plateau in 2009. Increasing numbers of oil experts are forecasting impending peak production plateaus. According to the International Energy Agency (IEA), the current peak production of 87.2 mbd occurred on January 2008. As long as demand continues increasing then prices will continue increasing.

 

Although crude oil & lease condensate (C&C) production is forecast to continue declining, the total liquids supply remains on a plateau until 2009 (Fig 1), due to offsetting production increases from natural gas plant liquids (NGPLs), ethanol and XTL (BTL - biomass to liquids, CTL - coal to liquids and GTL - gas to liquids). The main causes for the end of the total liquids plateau in 2009 (Fig 1) are that the C&C production decline rate accelerates to 3%/yr in 2009 (Fig 3) and the production growth from natural gas plant liquids stalls (Fig 15).

There is a possibility that gas prices may rise 50 cents between now and May:

 

http://www.peakoil.com/fortopic36614.html

 

There is an even greater possibility that the presidential candidates will fail to cite oil depletion as the root cause of the latest price spike.

As an antidote to the normally gloomy peak oil articles, today I thought I'd post one that's solutions oriented: 

 

http://gristmill.grist.org/story/2008/2/15/151252/412

 

 

Eliminating fossil fuels is friggin' cheap

A third of our military budget could cure our carbon addiction

 

Posted by Gar Lipow at 11:24 PM on 16 Feb 2008

 

Scientific American's grand plan (http://www.sciam.com/article.cfm?id=a-solar-grand-plan&page=1) to provide a bit over a third of U.S. energy from solar sources provides insight into what it would cost to phase out all or most U.S. greenhouse emissions. Bottom line: a lot less than current military spending.

 

The total cost of the SciAm plan: $420 billion over the course of that 40 years, or slightly over ten billion dollars per year -- less than current fossil fuel subsidies, less than the new subsidies "clean coal" would require...

 

 

http://www.energybulletin.net/40862.html

 

Published on 25 Feb 2008 by ASPO-USA. Archived on 25 Feb 2008.

Looking back 10 years - Campbell's "The End of Cheap Oil"

 

by Colin J. Campbell

 

From ASPO-USA’s perspective, the article entitled “The End of Cheap Oil,” published 10 years ago in the March issue of Scientific American magazine, marked a turning point in the discourse about peak oil—at least in the US. While a few books and a lot of articles had featured peak oil prior to that article, none had the circulation or prestige that the Sci-Am article carried with it—again, at least in the U.S. No, the world didn’t wake up to peak oil over night after the article was published, but it generated more interest than any document written during the previous two decades. It paved the way for the slew of books on peak oil that followed. It appears to have galvanized activists to action. We asked authors Colin Campbell and Jean Laherrere to revisit and reflect on their article these 10 years later. Here are Colin’s brief thoughts; Jean’s will be printed next week.

-ASPO-USA editor

 

In 1998, Jean Laherrère and I were asked to write an article for Scientific American magazine based on a study of oil depletion that we had recently made for Petroconsultants, which at the time maintained an accurate database of the world’s oilfields. It was privileged industry information but Petroconsultants had a sense of wider responsibility, and encouraged the study.

The peak oil crisis: Catenaries and pantographs

 

By Tom Whipple

As the availability of liquid fuels dwindles, those supplies that remain will be increasingly allocated to uses for which there are no readily available substitutes -- such as powering aircraft and ships. Electric power for land vehicles appears to be the most realistic option for the present. Cellulosic biofuels may come to power some share of land transport, but this is still many years away. Electric power is a proven technology and, more importantly, a widespread distribution system for electricity is already here...

 

 

Article archived at:

http://www.energybulletin.net/newswire.php?id=41030

 

Original article :

http://www.fcnp.com/index.php?option=com_content&task=view&id=2614&Itemid=35

 

This material is made available under 'fair use' as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, it is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml.

Glad to see the Tom Whipple I know and love is back. Seems he's been writing more blog-type stuff lately.

OPEC member Venezuela has helped drive up oil prices with recent threats to cut off U.S. sales in a dispute over Venezuelan President Hugo Chavez's nationalization drive.

 

I'm no Chavez fan, but this is absolute baloney. The most recent surge has more to do with the falling dollar than anything. 

 

The White House called for more U.S. and global oil output to fight rising energy costs, but a top intelligence official said on Wednesday that prices at $100 per barrel had yet to spur production.

 

They are completely clueless. 

They are completely clueless. 

 

For their next action, they will seek to siphon blood from a stone.

I hope that was sarcastic! If so, try using those handy emoticons  :wink:  :grin:  :-)  :-P

 

Sorry, I couldn't resist. :)  I read that post by you directly before reading your sarcastic post on this thread, and I found the irony quite funny.

March 4, 2008

Oil Tops Inflation-Adjusted Record Set in 1980

By JAD MOUAWAD

 

Capping a relentless rise in recent years, oil prices hit a record high during the day on Monday, then pulled back to close below the record.

 

The day’s highest trading price, $103.95 a barrel on the New York Mercantile Exchange, broke the record set in April 1980 during the second oil shock. That price, $39.50 a barrel, equals $103.76 today, when adjusted for inflation.

 

The surge in energy prices is taking place as investors seek refuge in commodities to offset a slowing economy and a declining dollar. Analysts pointed out that financial institutions like pension funds and hedge funds are also buying oil and other commodities like gold as hedges against a rise in inflation.

 

http://www.nytimes.com/2008/03/04/business/worldbusiness/04oil.html?_r=1&th&emc=th&oref=slogin

"James Schlesinger, the nation's first secretary of energy, predicted at a National Academy of Sciences meeting last Thursday that energy prices would continue to rise and declared that the United States would never see energy independence as long as it depended on the internal combustion engine."

 

http://www.energybulletin.net/41625.html

 

 

Also, several articles at Energy Bulletin.net:

http://www.energybulletin.net/41634.html

 

Published on Monday, March 17, 2008 by Energy Bulletin

Mainstream confronts peak oil - Mar 17

 

By Staff

Click on the headline (link) for the full text.

 

Many more articles are availa through the Energy Bulletin homepage

 

 

Sleepily eyeing a peak in world oil output

David R. Francis, Christian Science Monitor

Last week the price of crude oil broke new records, running about $110 a barrel. That's well above the previous record (in inflation-adjusted dollars) reached in 1980 after the revolution in Iran resulted in the nationalization of its oil.

 

Since tanks of crude are full to brimming, many traders in oil markets suspect that $110 could be the top price for now. But a growing number of oil-market analysts reckon the supply of oil to the world economy has reached a peak or is about to. The discoveries of new oil are now exceeded by the output of old oil. At some point, global oil output will start to decline, as happened in the United States in 1971.

An interesting take on the current oil & gasoline market:

 

http://www.goldandenergyadvisor.com/page/gez/newsletter/2007-12-24-054.pdf

I used to work with this guy...

 

http://uweekly.com/newsmag/03-26-2008/7953

Violating the American people, one gallon at a time

[6 Comment(s)]

 

By Lyndon Collins

 

Some things in life are just as simple as you think they are. Yes, you know exactly where you got that cold sore. No, that’s not a flashlight in my pocket. Yes, he is just saying that to get you to go home with him.

 

In a pursuit of psuedo-intellectualism, we have a tendency to overcomplicate even the simplest situations. It makes us feel smart to have the answer that no one else has. We feel empowered by explaining phenomena that others have no answer for. Well, you’re not that smart.

Well, he definitely got it right with the last sentence but left off the last part "....because we have to pay what they ask".  He made his bed, now he has to sleep in it.

I heart Lyndon! :clap:

What an idiot. The reason why they came up with Occam’s Razor is so that dumb asses like Lyndon Collins can try to understand a world that is way too complicated for them.

It's like Kunstler without a shred of knowledge about how markets function.

 

If oil is as easy to find as dog sh!t, he should start an E&P business.  Since he knows where to find all of the oil, he can be the one sticking the gas pump up people's a$$es.

http://www.fool.com/investing/value/2008/03/26/the-pied-piper-of-peak-oil.aspx

 

The Motley Fool

 

 

The Pied Piper of Peak Oil

By David Lee Smith March 26, 2008

 

I hope that Fools with an interest in energy pay at least some attention to Matthew Simmons' ruminations about the sector. The Texan (by way of Utah) author offers a sobering perspective on an oil supply-demand picture that I believe looks bleaker by the day.

 

Simmons, who's written Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy, operates from Simmons & Co., a Houston-based energy investment banking firm. On Tuesday, he was a guest on CNBC, discussing "peak oil": the notion that global oil demand will soon eclipse supply, if it hasn't already. John Hofmeister, the president of Royal Dutch Shell's (NYSE: RDS-A) (NYSE: RDS-B) U.S. operations, had already discussed the issue on CNBC last week.

Audio Program:

 

PEAK OIL = TRANSPORT REVOLUTION "Transport Revolutions: Moving People & Freight Without Oil" Speech March 18 by Richard Gilbert and Anthony Perl. How new oil economy reshapes air, road, rail, & shipping toward sustainable power. 080328 show 1 hr 56 MB

 

http://www.ecoshock.net/eshock08/ES_080328_Show.mp3

If Saudi Arabia can't keep OPEC's production numbers up, what does that tell you? It tells me the game is up.

_____________

 

OPEC's Crude Oil Production Fell 0.3% in March, Survey Shows

 

By Diane Munro and Mark Shenk

 

April 4 (Bloomberg) -- The Organization of Petroleum Exporting Countries cut oil production 0.3 percent in March, as Nigerian output dropped to the lowest in almost five years, a Bloomberg News survey showed.

 

OPEC pumped an average 32.35 million barrels a day last month, down 85,000 barrels from February, according to the survey of oil companies, producers and analysts. February output was revised up by 160,000 barrels a day. Production by the 12 members with quotas, all except Iraq, fell 30,000 barrels to 29.97 million barrels a day.

Did you also see that their Feb results were revised to being up by 160,000? It seems you can't put too much stock in these numbers until after some time has gone by....I'll wait for a few months of consistent falling production levels before I start to panic.

My point is that Saudi Arabia says to the U.S. "Sure, we can increase our production from 8.5 million barrels per day to 12.5 or even 15 million barrels per day -- no problem!"

 

The House of Saud can't even meet quotas consistently, let alone increase production by 4 mpd.

^they are going to make that promise for as long as they get away with it, tripe though it is.  Once everyone realizes they're at or past peak, they lose a lot of their influence in global politics.

 

 

My point is that Saudi Arabia says to the U.S. "Sure, we can increase our production from 8.5 million barrels per day to 12.5 or even 15 million barrels per day -- no problem!"

 

The House of Saud can't even meet quotas consistently, let alone increase production by 4 mpd.

 

There is evidence that they're trying...

 

http://www.bloomberg.com/apps/news?pid=20601072&sid=adw7Pi4b_a8o&refer=energy

Saudi Aramco Expects Khursaniyah On-Stream This Month (Update2)

 

By Grant Smith and Ayesha Daya

 

April 9 (Bloomberg) -- Saudi Arabia will start adding 500,000 barrels a day of oil to its total capacity when the Khursaniyah field comes on stream this month, an official at state-run oil company Saudi Aramco said.

 

The ``Khursaniyah field is coming on this month and within a month will be at 300,000 barrels a day,'' Abdulaziz al-Judaimi, vice president of new business development at Saudi Aramco, said today at the World National Oil Companies conference in London. Development work at the Khursaniyah field, on the east coast, will eventually add 500,000 barrels a day to the country's production capacity. 

well that article certainly casts some significant doubt on peak oil's supposed imminent arrival.

based on the eia's data, average daily production

2005: 84,631,000 barrels

2007: 84,635,000 barrels

 

an increase of 4/1000ths of 1%

An increase of 500,000 bpd is only about an increase of .5% over the current daily extraction rate.  I don't think this detracts much from the theory at all - especially considering that such an increase only just makes up for the slight decline in bpd extraction rates over the last 3 - 4 years.  IF they can manage to produce as much as they say (I'll believe it when I see it), this just brings us back to the level extraction rate for the last several years.  (Yet demand is increasing, so what does this say about the future cost of a barrel)

It's not completely insignificant...although you are correct in that these increases by Russia, SA, Angola, Libya, and others are small when viewed individually.  People like to point to Cantarell "crashing" by declining at a rate of 500,000 bpd/yr or something like that, but then poo poo an increase of 500,000 bpd.  I'm just trying to keep a balanced view.

 

It also gets people to realize that the Saudis aren't just doing their best Scrooge McDuck impression and swimming in gold coins.  They're actually some reinvesting money to increase output.

 

 

^ Yes, the balance is good, and deserves some attention.

 

Both need to be placed in perspective of actual daily production.  A 500,000 bpd decrease is still just 0.5% of total daily extraction (just like a 500,000 bpd increase is 0.5%).  However, my thought is that the decline is <b>somewhat</b> more significant because worldwide demand is increasing.

well that article certainly casts some significant doubt on peak oil's supposed imminent arrival.

 

Wow, that's pretty narrow of you. What's happening production-wise globally? Everyone knows Saudi Arabia is being called upon to produce more to offset declines in production elsewhere in the world. In recent decades, global production was able to increase at rates of about 3-5 percent per year. Yet with global demand so high in the last few years, the world's oil producers are able to eke out increases measured only in tenths of a percent.

 

Are we at the peak of production? There's no way we'll be able to tell until we look at global production data in retrospect. That's a lousy to plan for the future. We know it's coming. Maybe it's happening. But we can't deny it. All we can do and should be doing is to prepare for it.

 

But taking the conclusions of one article about one oil-rich part of the world to form an opinion isn't a good way to appraise the GLOBAL situation.

But taking the conclusions of one article about one oil-rich part of the world to form an opinion isn't a good way to appraise the GLOBAL situation.

 

Matt Simmons managed to write a best seller doing just that.  ;)

 

jk...I read the book, and for me it raised as many questions as it answered.  Good read, and it definitely caused me to look for more detailed information.

http://www.fcnp.com/national_commentary/the_peak_oil_crisis_the_first_shortages_20080409.html

 

The Peak Oil Crisis: The First Shortages

Written by Tom Whipple 

Thursday, 10 April 2008

 

Fuel prices alone are unlikely to bring America to its senses.

 

It clearly will take outright shortages with lines at the pumps, curtailed deliveries and many other misfortunes before serious measures to deal with declining oil supplies –- speed limits, rationing, mandatory car pools, improved mass transit -- are taken. Thus the question becomes: how soon?

 

Gasoline and diesel are two different animals in America. Most gasoline is used for personal travel and much of that for convenience and, as we shall find out shortly, is not essential to the economy. Diesel in America is, for the most part, an essential fuel in that it is used to perform money-making work or, in its heating oil form, keep us from freezing. If diesel becomes too expensive, and those expenses cannot be passed on, then the consumption of diesel will be cut back. This in fact is already happening -- the government is reporting that distillate consumption of diesel and heating oil currently is down by 3.1 percent as compared to the same four week period last year. This is undoubtedly due to the price of diesel and heating oil which is now around $4 a gallon, an increase of $1.17 a gallon since last year.

But taking the conclusions of one article about one oil-rich part of the world to form an opinion isn't a good way to appraise the GLOBAL situation.

 

Matt Simmons managed to write a best seller doing just that.  ;)

 

jk...I read the book, and for me it raised as many questions as it answered.  Good read, and it definitely caused me to look for more detailed information.

 

Actually, Simmons reviewed well over 200 technical papers from peer-reviewed scientific and professional journals just to get the information he discusses on the Saudi's  Ghawar field alone. 

 

Even in peak oil circles, it has been discussed that we may see a slight bump up in production this year.  The real news to glean here, however, is that we're at a plateau-- annual production just isn't increasing like it used to,  and all that's happening is that we're gaining negligible ground.  It is a fact that over 50 of the world's 65 oil producing countries are in production decline and nothing can reverse that. 

 

Exactly when declines will overtake new production we'll only know in retrospect as KJP says. 

 

 

 

 

Even in peak oil circles, it has been discussed that we may see a slight bump up in production this year.

 

From that article, it looks like they can make it to 12 mbpd without much of a problem.   It isn't just the 500k from Khursaniyah, but another 250k by December from Shaybah, and they're also working on 900k and 1,200k fields.  Not sure on the timeframe of those...next year or the year after I'd assume.  The upgrades to refining operations sound impressive too.

 

The real news to glean here, however, is that we're at a plateau-- annual production just isn't increasing like it used to,  and all that's happening is that we're gaining negligible ground.

 

I agree we're at a plateau, but I don't agree all of these increases from the Saudi's and other countries like Russia and Angola are negligible.  There are boatloads of money going into these projects now that should help us reach a new plateau within a few years.  I hate to say this, but I agree with Yergin and CERA about the shape of future oil output curves. 

 

It is a fact that over 50 of the world's 65 oil producing countries are in production decline and nothing can reverse that.

 

Really?  I think we're in for a really bumpy road ahead, but nothing?  That sounds pretty definitive.  I wouldn't expect companies to just give up when there are massive $$$ to be made in the oil patch.

 

This was actually one of the things I hated about the Twilight.  Simmons talked about how sad it was that the Saudis had to resort to "expensive" practices like injecting CO2 in some of their oldest fields, and then completely ignored that as an option for some of their biggest fields that are still in primary or secondary recovery.  Meanwhile, those expensive practices (think $10-20/bbl rather than $2/bbl) are allowing them to bring on production from fields that were previously thought to be depleted but still hat 60% of the oil in the ground.  Just think of all the cheap CO2 they could get from the nat gas they're flaring or from their massive refining operations.  They haven't even scratched the surface yet.