CNBC: Matt Simmons and John Kilduff Discuss the GAO Report and the Ramifications of a Plateauing Oil Supply with Bob Pisani

ED by PG: I moved the Simmons video under the fold for load times--also I have also posted the Simmons video on the GAO report/peak oil to another post above as well that contains three other pieces of video/audio media on the topic.

"The GAO report found no focussed coordinated government plans to prepare for peak oil or other supply disruptions."
"We are on the verge of replacing the term 'global warming' with the term 'peak oil.'"
"The best new oil basin we will ever find is the one called 'conservation.'"

Send this to everyone you might want to know about peak oil...implied in that is hitting the digg/reddit/linkfarms as well. Thanks for helping us spread the notion that we need to have this discussion.

Simmons came across to me as being very worried...

He mentioned shortages - not just high prices - for this summer.

Things are moving too fast now...

OMG! This is CNBC ???

Better get the remaining ducks in a row....

I wish all TOD readers and posters the very best.

Prof G - I notice alot more gardening ideas, etc from readers. I would ask if you could partion a space for TOD members to share ideas. Some of these folks are way ahead and it looks like we need to get moving asap...

Thank you for creating this site, best to you and yours.

OMG he looks worried....

Yes, the interviewer seemed downright breathless in his inquiry.
And Simmons isn't mincing words.
Perhaps we are reaching twin thresholds; of penetrating public consciousness
AND reaching the production peak, simultaneously.

Yes, Bob Pisani was more excited than I have ever seen him--pretty interesting. Also, I was collecting some links to send to friends and noticed that the EXXON CEO was on CNBC on March 7th touting that PEAK OIL is a SCAM. Let's see, 3 weeks and one report later. I think he should have to face Simmons. WesTexas's "iron triangle" was certainly at work on the 7th.

Matt did seem very concerned, more so than usual.

that's likely because he was reading these...
Saudi Arabian oil declines 8% in 2006
A Nosedive Toward the Desert
Water in the Gas Tank

A scam? A SCAM?...well exxon its almost summer baseball season and its your turn to batt. Don't miss we are watching...and others are watching too.
Every little kid who rides a bike,
every young couple who is starting a life together,
college kids going to school,
people ready to retire,
waitresses serving coffee,

Are you going to have the oil they expect so thier life doesn't turn to shit before thier very eyes?

I certainly hope so... they look at you as being the brightest and most in the know.

It's your turn, what ever you do - don't's your turn and we need another home run.

Yep Go check it out on CNBC's site. Do a search on PEAK OIL and the interview of the 7th will be one of the items listed.

The other think I noticed is that Kilduff seemed somewhat dismissive at first with his 18% comment plus new projects stuff. But after Matt spoke, he seemed to change his tune a bit. Not sure if he felt like he'd been "caught" spewing MSM nonsense...

Nothing like saying something stupid and then having Matthew Simmons come on and make it obvious you were spouting nonsense. Must have been very embarrassing for him. Good.

Re: XOM 2006 reserves announcement Summary of XOM reserve additions-

Ask Tillerson about this... let's them hide a 5 billion barrel oil reserve writedown--

They are a helluva lot smarter than Shell.

someone please fill in the 2006 blanks- all numbers Bbbls

Year Additions North Field LNG Production

2004 1.8 1.7 1.6

2005 1.7 1.6 1.5

2006 1.95 ??? 1.6

North Field LNG is where the action is.

Does this not support Hubbert's peak???

FF, please help this dummy!

They can hide a writedown of OIL in their LNG numbers?

Every time I think I have a very basic handle on this stuff, another fly ball comes into left field while I'm still standing there scratching my butt. Oh gawd, that's an awful, gross analogy, SORRY everyone. But it's pretty much how I feel: Standing in the middle of nowhere wondering what to do with the information overload and its implications....

Some days I feel almost paralyzed even though I am ELPing. There are always the questions: Am I doing it right? Did I pick a good spot? Do I even know what the heck I'm doing?

So help me here FF, I don't understand.

Exxon touts their 114% reserve replacement over the last 5 years-- but it is on a BOE basis.

They hold back on the North Field LNG to just replace their production plus a smidge more so every year they can tell the ANALysts they replaced reserves.

I was told that the gas from these LNG projects sells at $1.25/MCF at the wellhead or about $7.50 per boe. XOM touts a reserve development cost of $8/BOE.

In the meantime crude oil reserves are dropping .... but the effect is never seen by the Know nothings.

This is materially the same as covering up an oil reserve writedown to me.

Rex W. Tillerson is Chairman and Chief Executive Officer of Exxon Mobil Corporation.

A native of Wichita Falls, Texas, Mr. Tillerson earned a Bachelor of Science in Civil Engineering at the University of Texas at Austin before joining Exxon Company, U.S.A. in 1975 as a Production Engineer.

In 1989, he became General Manager of EUSA's Central Production Division, responsible for oil and gas production operations throughout a large portion of Texas, Oklahoma, Arkansas and Kansas.

In 1992 Mr. Tillerson was named Production Advisor to Exxon Corporation.

Three years later he was named President of Exxon Yemen Inc. and Esso Exploration and Production Khorat Inc., and in January 1998 became Vice President of Exxon Ventures (CIS) Inc. and President of Exxon Neftegas Limited. In those roles, he was responsible for Exxon's holdings in Russia and the Caspian Sea as well as the Sakhalin I Consortium operations offshore Sakhalin Island, Russia.

In December 1999, he became Executive Vice President of ExxonMobil Development Company.

Mr. Tillerson was named Senior Vice President of Exxon Mobil Corporation in August 2001, and was elected President of the Corporation and member of the board of directors on March 1, 2004. He assumed his current position January 1, 2006.

Mr. Tillerson is a director and a member of the Executive Committee and Policy Committee of the American Petroleum Institute. He is also a director of the U.S.-Russia Business Council and a trustee of the Center for Strategic and International Studies. He is a member of the National Petroleum Council, the Business Roundtable and its Energy Task Force, an honorary trustee of the Business Council for International Understanding, and a member of the Emergency Committee for American Trade.

NOte that you can google the 2005 and 05 reports and the North Field LNG component is expressed explicitly.

Not so for the 2006 report- I wonder why??

Funny you should mention that, I've been trying to find the 2006 numbers for the north field for 1/2 hour and haven't been able to. I thought it was just me....

So, it not only bodes ill for oil replacement, it has a financial impact since they are giving the gas away at a loss.

There was that one analyst that did catch the reserve issue, but his comment about the reserves wasn't really addressed in the was a political type of response from Hubble.

This brings up another concern of mine. About the middle of 2006 either a new law or a signing statement (I lean toward signing statement) went into effect whereby companies can falsify their financial statements and not be held liable under the umbrella of "national security." It is pretty vague, doesn't say what companies, and doesn't say what constitutes national security. It was all done very quietly and it kind of freaked me out. At that point, I started moving my IRA investments to mainly cash and small companies with climbing reserves and drillers/support.

I considered that signing statement to be the real canary in the coal mine concerning the state of our economy and "national security," and being PO aware I felt that the "national security" issue related to oil and its ultimate effect on the US. If everyone freaked out and bailed from the stock market, it would accelerate the problems. I saw it as an attempt to mask the problems and make everything appear to be business as usual. Just MHO.

I went through some of my email archives. For those that may be concerned about the STOCK MARKET, I have this to offer:

… Business Week Online has just reported that George W. Bush on May 5 signed a memo entitled “Assignment Of Function Relating To Granting Of Authority For Issuance Of Certain Directives: Memorandum For The Director Of National Intelligence.” In the document, Bush assigned intelligence czar, John Negroponte, the task of waiving Securities and Exchange Commission rules, established in 1934, pertaining to accounting disclosures by publicly-traded companies. As a result of no longer needing to reveal financial information to shareholders in the name of national security, the cloning of Enron, having been in process for several years, is now complete. Instead of being required to disclose valid accounting ledgers, U.S. corporations have now been given carte blanche to maintain fiduciary legerdemain. I must ask: How can any sane human being persist in believing that a legitimate government exists in the United States?

If anyone is interested, I have a longer report that breaks down the sections of the signing statement.

I am posting this in response to FF's posts about reserve shenanigans.


Would you please get this in front of Prof G. so he can get it posted at the start of a thread.

The statement
"Bush assigned intelligence czar, John Negroponte, the task of waiving Securities and Exchange Commission rules, established in 1934, pertaining to accounting disclosures by publicly-traded companies."
completely undermines the checks and balances put in after the 1929 crash to prevent a repeat of same.

All the assurances from the financial institutions that we can't suffer another round of bank failures and stock market crash like the depression, because of changes to the system, carry no weight if those changes have been recinded recently.

Great catch, thanks for posting.

Sure can.

It was so stunning that I considered it the beginning of the end and a good reason to avoid all large US corps especially and to be very concerned. I tried to warn family and friends, but everyone seemed to think I was over-reacting since they consider me to be a "peak oil kook" overly concerned with fascism and loss of freedoms. And Negroponte was one of the big guys behind the Iran/Contra affair and not trustworthy in my estimation.

If Prof G doesn't want to post the text I have, I'm willing to email it to anyone who wants it. Please send your request to my backup email account at

I was one of those people who lost money because Worldcom was fudging the books. I'm out of the market all together except for Cameco(CCJ) Where I know enough that I could care less what their books say. How can you possibly trade otherwise if none of the financials are known for sure. It sounds to me that the total reason for this is the avoidance of "panicing the market" by telling them the real situation. In other words setting up investors for the big fall, in order to keep the game going for a little longer. Get Out, Get Out Now! Now that I think about it, I think I'll get out all together. Maybe it's time to put it into a large chunk of land I intend to live on and make Post-Oil improvements. The only reason for such a signing statement is the game is over except for the losing.

ckaupp, it was a "presidential memo" that Dubya signed on May 5th, 2006. All the memo did was *delegate authority* to the Intelligence czar to allow for exemption of proper SEC book keeping in the name of national security. Here's a, >Business Week article.

This presidential authority has apparently been in place since Jimmy Carter, but GWB has moved where the buck starts and stops on this call to his Intelligence czar. With the number of smoking guns and dead bodies lying around our illustrious chump-in-chief but never his fingerprints, this is just more of the same.

I agree that the vagueness around this whole National Security & economic transparency stinks to high heaven. As it is the amount of number fudging and market management that our Govt. and the Fed does nowadaze is criminal. This just makes it legal for companies to lie on their numbers if our National Security interests are deemed at risk. Does PO fall into this category? I think it does too.

Now, excuse me while I go polish my tin-foil cap.

The clip I pasted is from the BusinessWeek OnLine article.

BTW, regarding your comment "This just makes it legal for companies to lie on their numbers if our National Security interests are deemed at risk" ......"JUST????" in no biggie?

I believe they already consider this to be a national security issue. It has been since 9/11.

This seems to me necessary and unexceptionable. It stands to reason that Boeing, Lockheed, etc can't be providing detailed breakdowns of their classified work in their accounting reports and their needs to be some legal mechanism for taking care of that (if one is going to have a classified budget at all, then obviously it mustn't be posible to figure out who is getting how much of it).

So in the absence of evidence of specific misuse of this authority, I don't see an issue...

It does not say what companies or for what reasons, in other words defense companies are not singled out. Since financial statements are foundational to our capitalistic investment system, this seems quite important. If I over-reacted, I wasn't alone -- BusinessWeek was pretty blown away. Note the last sentence of the clip I pasted--that wasn't my comment, it was BussinessWeek's.

Note the last sentence of the clip I pasted--that wasn't my comment, it was BussinessWeek's.

I'm sorry to inform you that you are wrong. The quoted comment used above is from Carolyn Baker in an article she wrote for

As Stuart suggests, it may not be as nefarious as it seems, but with this administration (and government in general) I think it worthwhile to question everything they do.

I accept that I was mistaken on the quote.

I still don't feel that it is acceptable to falsify financial statements for a public company for any reason. If they have reason to hide what they are doing, they should be private, not public. Accurate financial statements are the basis for investing in public companies. Anything that undermines the public trust is bad news.

Has anyone looked at the list of companies currently under scrutiny for misdeeds and backdated options? It's a pretty stunning list that contains some of Americas premier companies. The latest addition to the list was Beazer Homes. And Dell recently admitted they may have some accounting "issues". Whether they are related to the signing statement or not, there are a lot of shenanigans going on in our financial world.

You are correct. It's time to TOTALLY get out. If the world is about to fall off a cliff because the supergiants are about to collapse like a row of dominoes, I would say THAT is a national security issue and that means listed reserves, projected production, imports and costs all fall under the umbrella of this signing statement. In fact, anything that any publicly traded company engages in that might let the cat out of the bag would fall under this. That's why it's so obvious they are lying; BECAUSE THEY ARE AND THEY'VE BEEN GIVEN PERMISSION BY THE US GOVERNMENT.

Hi Stuart,

Thanks for your comment.

re: "So in the absence of evidence of specific misuse of this authority..."

Some generic qs:

1) Is there oversight? So, someone, somewhere *does* have an opportunity to example the "detailed breakdowns of...classified work"?

2) How is the oversight managed?

3) Who is actually in a position to bring forward evidence of specific misuse?

4) Can these people, (3) do their jobs without interference?

5) As far as I know, there is at least one group of people who seem fairly convinced that there is no oversight that is meaningful in regard to the work done at the national weapons' labs, namely To take one example, which falls in the general category Boeing, Lockheed, etc. might also be in.
For another example, see "Blackwater: The Rise of the World's Most Powerful Mercenary Army" by Jeremy Scahill.

5a) In other words, if "evidence of specific misues" did/does, indeed, exist - who would know? Who is in a position to know? Who is in a position to do the work required to find out?

As an example, the judicial firings evidence was investigated and compiled by an independent journalist group, "Talking Points Memo", as reported in an article in the LA Times "Column 1" March 17, 2007. (I'd try for the link, but on this computer, it never works.)

6) This may or may not be relevant...I'm wondering if you think the same idea applies to matters related to the things we discuss here - energy, etc.

In other words, re: "necessary and unexceptional"...
Yes, point well taken if one accepts classified work as part of BAU (so to speak). At the same time, who gets to decide what is classified to begin with? And, given "necessary", then, my other qs follow.

^ Exactly!

Oversight? Trust us.

"How soon we forget history... Government is not reason. Government is not eloquence. It is force. And, like fire, it is a dangerous servant and a fearful master." - George Washington

"This conjunction of an immense military establishment and a large arms industry is new in the American experiment. The total influence -- economic, political, even spiritual -- is felt in every city, every State house, every office of the Federal government...
We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together." - Dwight Eisenhower

Trusting our government, especially this one, is a fool's paradise.

Edit: Please substitute "firing of US Attorneys" for "judicial firings" above.

Thanks Aniya. I was wondering if our actuary was lurking...

Hence my concern. There seems to be no oversight in sight anymore anywhere. The US is terribly in debt, we are at war, and we are facing several huge crises at the same time -- one of which is the biggest challenge to ever face modern society or even humankind.

There is no question, power corrupts. Always has, always will. Now they want the option to lie on financial statements when my IRA funds are at risk. I don't like it. It sounds just like the eavesdropping on telephone calls: Trust us, we are only listening in on overseas calls between terrorists. Oh, okay, Never mind, besides my game is on ESPN right now.

It is up to "We the People" to monitor our government and make them obey the law of the land. If we don't, who will?

Thank you, Cheryl,

I appreciate your bringing this up, as I hadn't seen it. The Business Week article, just on its face, raises bells to me.

I wanted to add to my thoughts about what Stuart was saying. The idea about oversight being necessary, just like the necessity of "a free press", is part of the idea of things like "checks and balances", it seems to me.

As this built-in oversight is removed or altered (or was not set up to run well in the first place), problems could be almost guaranteed to arise, even without particular intent (necessarily).

One way to look at it is - the right structure has to be in place to allow for people to be able to act in an honest/moral fashion, it seems to me.

One could make the case, philosophically, that things have to have a basis of trust at the foundation, and in a sense, I agree. And this may be (just guessing) where Stuart's coming from - i.e., no particular motive on anyone's part, just "BAU". At the same time, if something comes up, without the right structure, (the "checks and balances"), there is no way to correct a mistake. (To take the most naive case, i.e., one w. no particular intent.) Anyway, more cents. Thanks.

Yes, I'd also be interested in what Gail has to say about this. (Jack and others as well.)

Presidential Memo.

There seems to be quite a discussion on Presidential memo's and there constitutionality. Claiming it as a legal reason is not claiming its constitutional or legal.

"apparently" been in place. This to me does not say "here is the Constitutional authority> Apparent is a weasel word.

Stuart claims there is a blanket authority given to the President and not only that this blanket authority can be DELEGATED to a non elected official to do as he pleases.

Where is such authority to do so. What law or action is available to prove such a position.

It would seem that over site of this is missing "again". National Security matters are not above the three branches unless great need can be shown. Blanket authority given to an un-elected official to do as he please.

I don't think so.

Nice catch CK, with the proven record and the one now on display with the Justice Department I think it stands to reason that trust in using such authority for the public good instead of political/private/personal/etc etc. good is way past its prime.

Impeach now.

Quid Clarius Astris
Ubi Bene ibi patria

"apparently" been in place. This to me does not say "here is the Constitutional authority> Apparent is a weasel word.

Yes, I agree wholeheartedly. But for anyone who has been paying attention over the years it is quite apparent the weasels don't give a damn what the Constitution says. And, apparently, neither do We The Sheeple.

I am no sheeple.

hence the moniker

Quid Clarius Astris
Ubi Bene ibi patria

FF, is it this?

A couple of questions relating to Qatar given your substantial investment plans in that country, and in particular relating to the North Field itself, looking over the last couple of years, it seems as though roughly 90 percent of your proved reserve additions have come from that field alone. So the question is what’s left to book? Presumably GTL is one that’s still in the sidelines, given the Qatari’s have yet to fully sanction that project, what else might be there?

I still haven't found the numbers, but this is a question posed at the 2006 year-end news conference. So it appears that 90% of their reserve replacements for OIL were actually OIL EQUIVALENTS, or GAS, and they touted that overall number for everything. Only by digging deeper into the financials would you realize that proved OIL reserves went down, not up.

Indeed, Exxon's acquisition of Mobil in 1999 was seen largely as a natural gas play. Paul Roberts wrote about this in The End of Oil:

[Natural gas] is also part of the driving force behind many of the megamergers in the oil industry during the 1990s; for example, although Exxon and Mobil glossed their 1999 merger as a joining together of complementary strengths, most in the industry saw the union as a tacit admission by Exxon that it had failed to exploit its stranded gas assets, whereas Mobil was one of the acknowledged leaders in LNG.

From Paul Roberts, The End of Oil, pg. 177 (Big Oil Gets Anxious)

- there are emotions in the air - these people know the implications to the subject - and now more will follow suit..

I reckon Peak Oil in the public domain after this NBC interwiew - the message was timely put foreward and in a sober mannor. If I was new to the consept of peak oil - my eyebrows would loosen ... and actually in watching this I became a little saddened , even if there where nothing new to me - but I got the message on MSM as a headline story.

Congrats americans - You lead the way in informing your populace and start taking on the issue 'that surmounts even time itself', in Europe it is deadly silent by.... at least for now. I wonder when you will deny the SUVs (my stop-watch is ticking) and enter the new era of cars used back in Bedrock-city - nope - not Detroit-Rockcity those are the ones you shall start to decommision

"After 2012, the oil party is over."


"Steenkool, aardgas, aardolie en zelfs uranium zijn waarschijnlijk een kortdurende, misschien zelfs ongelukkige zijsprong. We weten nu zeker dat fossiele brandstoffen geen toekomst meer hebben."
"Coal, natural gas, petroleum and even uranium are likely a short-lived, maybe even unfortunate sidestep. We know know for certain that fossil fuels no longer have the future."

Simmons came across to me as being very worried...

He mentioned shortages - not just high prices - for this summer.

Things are moving too fast now...

I saw that too.

I'm glad I'm not the only one who has noticed the pace has picked up in the past few weeks.

I'm very concerned about the gas shortages Mat spoke of.
I assume they would only be temporary and coincide with peak driving season in summer?

Also what effect would this shortage have on the airline industry? Would they curtail flights?
What happened back in the 70's oil shocks with regards to air travel? You only ever hear of gas shortages for cars.

I find the issue of the airline industry to be of great personal interest at the moment.

Ticket prices are low historically. The airlines have remained viable by cutting labor costs and hedging fuel costs. There are some efficiency gains as old jets are replaced. Jet engines have gotten much more fuel efficient (noise reductions come from better, more efficient designs).

Hedging only gets you so far, efficiency gains are slow, and labor has about been wrung out, so the big Q now is what happens if fuel costs rise significantly. Air travel among the middle class is infrequent enough that ticket prices can go up considerably w/o much drop-off, esp. if a 55 or 60 speed limit is imposed. But the expansion of improved video-conferencing and I-net B2B transactions, may mean that business travel drops with major price hikes.

When you see jets making mid-country fuel stops on cross-country flights, you'll know the (last) new era of air travel has begun.

Boeing and the Brits are playing around with scale models of "next-gen" blended-wing-body (google it) aircraft that could improve fuel efficiency some more and probably allow for over-ocean airtravel for a little while longer, but it's not clear, with peak oil, that the $$ will be there to design, build and deliver anything in time for it to matter. Theoretically, a BWB could be liquid-H2-powered, but then you also have the issue of infrastructure, design delays, etc. With the military's awareness of energy issues, if DOD were gonna drive devt of a BWB, we'd probably know about it by now. So far, strange silence...

I think ticket prices went very high, and they were struggling(multiple layoffs, etc), if I remember correctly. I do remember the gas lines, odd/even license days, $10.00 limit,closed on sunday, it was my first real job after school pumping gas. Alot of unemployment, house construction went way down. I remember firewood was the rage. Lots and lots of people with trucks of firewood. Jimmy carters "put on a sweater talk". Now we have 10 x the population locally. yikes

Actually, IIRC, the airline industry was very well protected under the circumstances. Oh, there may have been some little disturbance. But not once did I ever have the slightest trouble getting student-discount tickets at a good price (for the time). Not even at the very same time as I was getting newspaper clippings from relatives about people spending the entire night in gasoline lines, an extreme reached sporadically on the East Coast.

After all, the airlines were (and to a great extent still are) mainly for those in society who, so to speak, take very very good care of themselves. My easy-to-get tickets were simply a side-effect - very likely an unintended one as none of the hastily-contrived government rules about oil-product use were in any way well thought out.

For the most part, it's the ordinary chumps who get kicked in the teeth at times like that, and government typically makes it worse. Never is the - as it was called, jet set - asked to share in the sacrifice.

the 70's crisis in Norway rendered private-car free sundays - and those days were the days of coke as a fuel source - today norwegians particularly in the cities are using electric-heating, althoug there are schemes to leave this nowadays.

Give me those sundays back -

Hi Rethin,

Shortages probably won't be temporary as shown by the increasing demand supply gap in the forecast below.

The GAO report will be an excellent catalyst to prompt further analysis and action!

That graph makes my stomach hurt.

Here's my question. I'm currently in Japan. I don't consider my position here sustainable.
I want to take my wife back with me to the States where my family has farmland (and at my urging has been doing some PO preparations).

Do I drop everything and go now before the fuel shortages?
How much time can I allow to wrap up things here in Japan before I have to flee to my lifeboat?

BTW I can't believe I'm typing this question. Someone please tell me I'm being a crazy doomer here.

The shortages will push prices up in the short term.

The IEA has a page on Energy Security if shortages become serious

The worst that will happen is that the IEA's emergency agreement called the IEP agreement is invoked and oil rationing starts:

From Article 5 on page 4 "Each Participating Country shall at all times have ready a program of contingent oil demand restraint measures enabling it to reduce its rate of final consumption in accordance with Chapter IV."

Article 13, page 8 describes the first activation event "Whenever the group sustains or can reasonably be expected to sustain a reduction in the daily rate of its oil supplies at least equal to 7 per cent of the average daily rate of its final consumption during the base period, each Participating Country shall implement demand restraint measures sufficient to reduce its final consumption by an amount equal to 7 per cent of its final consumption during the base period, and allocation of available oil among the Participating Countries shall take place in accordance with Articles 7, 9, 10 and 11."

Japan - yes, long term I agree that for several reasons life will get harder here.

But, BUT , be careful to make wise decisions, not spur of the moment reactions based on fear. I do not plan on remaining in Japan, though I like the place, and will relocate, but not out of panic of not having oil tomorrow.

Japan keeps a large supply of oil on hand - they learned their lesson well in WWII. Sporadic shortages over summer are unlikely to cause a crises here, IMO.

It is the long term economic health of Japan which is in doubt - an aging workforce, shrinking income tax revenues, and an export economy that revolves around the US and China. Energy crises causing economic crises in both those energy consuming giants will wreck havoc with Japan's export model.

Your consle not to make decisions based on fear is wise advice.

That said,

I'm not sure why you think Japan's economy is so insulated. I'm not sure what you do here, but my job is very dependent on the US economy.

I design the CMOS image sensors in digital cameras and cell phones. This is a very non discresonary side of the economy (first thing Americans will cut from their budget is a new digital camera). In addition I am very junior in my position. On top of that I am not a regular employee of my company but a contract employee. I am quite sure I will be included in the first or second round of layoffs.

Japans stratigic oil stocks are about double the US's in terms of days (around 50 compared to 100) but what difference does that really make?

Perhaps I can hold out here in Japan for a year or two after TSHTF but to what end?

Don't get me wrong, I love living in Tokyo. My quality of life is quite high. My Japanese language skills have progressed to the point where I feel confident in daily life and am quite proud of this. I don't want to throw that or my career away.

But what choice do I have? Better to get out while the getting is good right?

When and under what conditions are you considering relocating?

Please don't get me wrong - I merely indicated I believe that *this summer's* possible shortage of fuel (as envisioned by some for the US, especially if a hurricane takes out some GOM production...) won't translate into rationing here in Japan. Besides the official strategic reserves there is also the private stockpiling. And as you well know, many Japanese have the option of riding the train if they don't want to drive their cars.

However, it is quite clear that Japan's import/export model of prosperity is at high risk. Indeed, all of the east/southeast asian economies are interwoven with China and the US, often through Japanese middlemen. If you think Japan is at risk, how about my friends in Thailand or Taiwan?

FWIW, I will relocate for health reasons. But even if I were young and genki I would look seriously at not staying (unless I were married to a Nihonjin and shared some family property here and truly could operate in the society...) beyond the end of this current economic expansion.

Don't forget food security issues. I recall something like 60% of food is imported and that Japan has one of the highest "food-miles" figure (farm to table) anywhere. Japan's consumer-discretionary exports pay for the food...

I'm sorry, I don't see any meaning in the above graph. Although it's quite possible that the plateau continues, and even that oil production starts decreasing in the next years, a "growing gap" between demand and supply is a non sense : we can simply not consume more oil than what is produced.

What will happen is simple demand destruction. As a matter of fact, it has already begun, because 2007 demand/supply is already 2 or Mbd below 2005 expectaction. But you will never see a demand curve much exceeding supply : the rising prices will either ease the finding of new supplies, or destroy demand, or a combination of two insuring the near equality.

Of course what is not excluded is that demand destruction will be produced by economic recession, and that will be the beginning of the real PO...

The right side of this graph is cut off on my computer after July '06. Is there any way I can view the whole thing? I have a simple computer running windows on a dial up connection.

I added a 'width="100%"' clause to the img tag, which should have fixed the problem.

Ace, have you not updated the graph to reflect current prices? Your price line does not show the recent runup at all and suggests per barrel prices below $60 per barrel when they are now clearly in the mid-$60 range. In fact, it looks like your price spike may be starting 6 months early.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett


The price used in the graph is "All Countries Spot Price FOB Weighted by Estimated Export Volume" from

This price takes into account all the different types of oil and the price has only been updated for the 23 March numbers.

Eg On Mar 23 Canada, Lloyd Blend 22API was selling for only $42 while Brent was $61 and Tapis was $66.


...demand supply gap

And you wonderfully drew us a picture of it.

Dude! You hafta get some ECON 101 under your belt or we are all going to think you are a high school student.

.. he he I eyeballed that one myself

every day I demand 110% - but they only give me 100% - f*** them

The chart confuses me -looks like some professionals did it - but maybe the supply/demand graphs are superimposed to them real-world data ... ?

did you add that supply-line , ace?

The supply line forecast is made up of the following forecasts:

crude oil & lease condensate(C&C), in decline
natural gas liquids, rising
ethanol, rising
GTL, rising but very small
BTL, CTL very very small
processing gains

C&C may have peaked on May 2005 at just over 74 million barrels/day. However, production increases from NGLs and ethanol delay the total liquids peak to July 2009.

Some comments on supply and demand. Actual supply is not exactly equal to actual supply because of inventory additions/drawdowns.

Demand is forecast to increase by about 1.8%/yr derived from forecasts for each country. Next, short term and long term elasticities of demand are used to calculate how much the price would have to increase to close the demand supply gap. This forces the demand to fall to be equal to supply. This is called demand destruction which is occurring now.

EIA, IEA, CERA, ExxonMobil all forecast demand and supply. Some also forecast the price. ExxonMobil only really forecasts demand and naively assume that someone will make the "call" on OPEC to supply the demand.

Nobody can know for sure precisely how all this is going to play out over the medium to long term, but the dtails don't matter that much when it comes to the airline industry. It's a dead man walking. Just a matter of time.

Simmons came across to me as being very worried...

Hmmm... where have I heard something like this before....

'Hair on fire'

Clarke said that "on June 21, I believe it was, George Tenet called me and said, 'I don't think we're getting the message through. These people aren't acting the way the Clinton people did under similar circumstances.' And I suggested to Tenet that he come down and personally brief Condi Rice, that he bring his terrorism team with him.

"And we sat in the national security adviser's office. And I've used the phrase in the book to describe George Tenet's warnings as 'He had his hair on fire.' He was about as excited as I'd ever seen him.

"And he said, 'Something is going to happen.'"

Yes both Simmons and Pickens talked about shortages. Pickens calling it 'unavaliable' oil.

Coupled with the worldwide drawdown in stockpiles and the 20% decline in Cantarell there is plenty of momentum for a widespread Peak Oil awareness in the upcoming months.

I'm thinking about the expectations of most folks to continue their easy motoring future this summer. If prevented their reactions may be unpredictable. A friend of mine just 'got it' (from me sorry to say) this week.

He understood the difficult consequenses for food production in general and his lifestyle in particular pretty readily. In short I watched while he envisioned what his retirement was going to be get significantly altered. He was understandibly very angry.

All I'm saying is if this mass awareness happens we are going to see a lot of people progress through what we have had to adapt to in our thinking in the last months or years since we became PO aware. And sure many will just want their darn gas.

Individually it's tough. Collectively it's a crisis. There are bound to be more pressures on the 'mental health' side of the system, the law enforcement, and the spiritual/social orginizations.

Perhaps it will be well for us to remember how depression and anger and acceptance and then finally a motive to prepare came about as we 'worked' through the learning curve and be prepared to accomodate feelings of our friends and loved ones.

OTOH just another 2c. There are going to be some real upset people out there who we may or may not be able to do anything for in the immediate situations we find them. So take care and all the best to my fellow TODers.

"unavailable oil" = "negabarrels"

LOL 'fantasy fossil fuels'

That's great, Lou! Definitely use that phrase in a future article!

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett


The message seems to be sticking.

Quote of the Clip:

"This is not going away and we will be talking about it in the future."

Gee, ya think?!

Ummm...all I can say is "Holy Frickin WOW"!!!!

That's one of the most blunt MSM conversations I've heard...ever...about the whole topic. Matt is straight up in his discussion. I especially like what he said about the top folks looking at Peak Oil DO NOT HAVE A POLITICAL AGENDA!!! This is not about politics, but that is the framing job that folks will try to put on it. A bunch of Green Energy liberals trying to scare people.

Matt is the poster boy against that notion and that is helpful in getting Joe Sixpack to fess up to the truth.

Way to go Matt for getting the truth out there. Same goes to Roscoe. Today was a big day in putting the cards out there on the table.

Now...who's gonna pick up their hand and make their play?

BTW...not to toot a horn or anything...but I did peg 2007 as the year of PO awareness in the general public.

Are we there yet? Not yet, but today...we moved a bit closer.

Ask that question after this summer.

HUH? Didn't Simmons just hook up with Romneys campaign?

Simmons has signed up with the Mormon candidate? Interesting. The Mormons are likely the best prepared for the dooomer's version of peak oil. I've heard that the church leaders recommend storing a years supply of food.

"I don't think there's a single one of them that has a political agenda, I know I certainly don't!"
Oh My Gawd I had to listen to it twice! Why would he say that? And the way he said it, like he got caught in his mommas underwear! I'm sure Yergin et al will jump on that like a hobo on a ham sandwich. Joining a presidential campaign is a bout as political as you can get here in the good ol USA. Say it ain't so Matt!
From yesterdays Drumbeat

Simmons was part of the GW Bush 2000 campaign, too. It does not mean anything. The campaigns just sign up a bunch of Republicans with money to mention in their fundraising letters. It gives the candidates some credibility even if they, like Bush, don't listen to what they have to say about topics like peak oil, for example.

Interesting thing about Simmons and why I worry every time he opens his mouth: on a personal level, he and I probably have nothing in common. I have very strong opinions about Mormons, which I'll keep mum about (had an uncle who was one: oh boy). I don't agree with his politics, I don't agree with his let's-open-every-available-shoreline-and-wilderness-area-to-
the-drillbit solutions.

But my gosh, when he starts talking about peak oil, I just get the willies.

You don't have to agree with someone on every point in life to recognize they may be correct about some particular point. Simmons is very unsure about global warming but he also admits he has not studied it as hard as he has studied peak oil. Is the guy nuts? No, he's actually very cautious and refuses to stick his neck (and name) out for a cause that he has not researched himself. Now I think he is very wrong with regards to global warming and that not having a firm grasp of global warming slants his solutions to peak oil in a particular direction that he might not otherwise choose if he was conversant about peak oil.

Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett

Hi GreyZone,

Thanks and it's getting to where I see your signature line in my head (when offline). Otherwise...

re: "...not having a firm grasp of global warming slants his solutions to peak oil in a particular direction that he might not otherwise choose if he was conversant about peak oil."

My impression is that Matt misspoke, in a sense, when he said (along the lines of) global warming will be replaced by "peak oil". I think he meant in terms of import - as a topic for public/media discussion (and, hopefully, action).

It would be great if he could make this more clear. Say something like, "From my vantage point, "peak oil" is the most important topic we can be talking about." (He did say a couple of things that would support this. At the same time, the mention of global warming leave the viewer/listener confused, is my take on it.)

What he might think (I'm guessing, based on this interview): "'Peak Oil' beats 'global warming' because without addressing 'peak', we are looking at global economic collapse."

He kind of says the economic part, although his use of the word "sustainable" also is a tad confusing without more explanation and time. (Drat the time limits of media.) I wish he could have said a sentence or two more.

Actually, unless he can address these specifically in detail, I'd suggest to stay away from comparisons between the two (PO and GCC or GW). My suggestion for him would be to stick to talking about why "peak" is so important. Perhaps say: it demands the same attention and discussion currently given to "global warming".

And...without putting even more words in his mouth...

What I'd like to see Matt do:

1) Say he is unsure about GCC - if he is unsure. (Or, whatever the truth is about his relationship to studying GCC.)

2) Say why he is unsure (eg. hasn't studied it).

3) Then, without having to study it, simply address the case as a "what if?":

a) What if GCC is as told by (name your favorite author/scientist) is a valid explanation and prediction?

b) How does this affect our choices in view of "peak oil"? Does GCC and GHG emissions impact our choices in view of "peak oil"?

Yes, it would, because coal use has more GHG emissions than oil. Or, more generally, "Yes, because we want to add GHG to our selection criteria when we think about how to proceed." (Or something like this.)

c) Or, even to say "Yes, the issue of GCC and GHGs does intersect with peak oil. It must. You know, though...I'm so concerned we face a huge and immediate economic problem, that I cannot even focus on global warming. We have to start talking about how to deal with this urgent problem." Actually, now that I write this out - I can imagine this might be where he's at. (Of course, I'm totally guessing, just assuming your take on it is a "match", Grey.)

I'd be interested to know what Matt does think about it. To me, the obvious thing is that we need to use the energy we have now to put in place any mitigation of any sort. GCC affects our evaluation of the desirability of particular mitigation paths. (Example, "dirty" v. "clean" fuels.)

This is such tough stuff - the constraints of the medium. Reminds me why I don't watch TV. (Exception made for this 7 minutes, in support of Matt's work. Thank you, Matt.)

Not that I agree to it as a solution, but I think the reason Matt wants to drill everywhere is because he sees it as a crisis that can't be mitigated in the short term. From everything he has written, I think he sees a crash, not a gentle decline. So, if the majority of the people want to eat, then he believes we must drill.

Hi Cheryl,

This is also my impression of Matt's thinking. It would be so wonderful to be able to have a relaxed conversation w. him, in a supportive atmosphere. (Here, perhaps?)

One thing I'd ask is: Okay, so say we explore drill off the California coast, for example. My concern: if this effort is not tied directly to mitigation measures and a well-thought out and effective overall plan, would we not end up in exactly the same crises - only magnified?

Excellent idea Aniya: tie all drilling to mitigation efforts and a REAL plan. Otherwise, as you say it will just postpone the crisis -- only then there won't be anything left off the coast to drill.

I would LOVE to be able to talk to Matt too. I wonder if TOD would be willing to host a thread from Matt to answer some of our questions.

"Not that I agree to it as a solution, but I think the reason Matt wants to drill everywhere is because he sees it as a crisis that can't be mitigated in the short term. From everything he has written, I think he sees a crash, not a gentle decline. So, if the majority of the people want to eat, then he believes we must drill."

And if 3/4 of the world population starves to death in the next 10 yrs, global warming will be a non-issue.

I think what he probably meant is that he is not acting out of a partisan political agenda in trying to warn about peak oil. Obviously, he has very different political views than, say, Richard Heinberg, but, I think he is saying, they are both just trying to get the word out that "Houston, we have a problem."

I think that's right, Stuart. We all have our various political views, but they are largely separate from what we're trying to do on peak oil.

For one thing, I can't figure out what common "political agenda" we would have. Peak oil includes traditional conservatives like Rep. Bartlett and Matthew Simmons, but also liberal-left-greeners like Heinberg and myself. On the other hand, the political party with the most explicit peak oil platform is the far-right BNP in the UK. So, go figure.

The only common element seems to be an unconventional way of looking at things, and a willingness (to put it mildly) to think for oneself. I find it stimulating to talk to other peak oil people, no matter what their political background.

Energy Bulletin

You're lucky, I haven't been able to talk to anyone about this outside of my wife and she can only take so much. Still it seems you must be "the one without sin to cast the first stone". Look at the debate here at TOD over the last couple weeks concerning the HL. I have no doubt they would love to lump us all together as a bunch of peak oil crazies. I sure wish he had chosen words that simpletons like me couldn't misconstrue. Say, weren't the Jonesvillians that refused to drink the Koolaid shot outright?

Say, weren't the Jonesvillians that refused to drink the Koolaid shot outright?

Many of them were held down and injected with the poison.

I've been told to get off of the soapbox, by people who otherwise admire my understanding of the world, whenever I talk about peak oil. I guess no matter who you are or what you know, peak oil puts one into the sandwich-board "The end of the world is nigh." camp.

I'll just keep riding my bicycle and continuing to convert every square centimeter of my lawn into garden. Crazy in a happy motoring utopia sense, but not so crazy in the baseline survival sense.

I work at an OP Rehab(Physical Therapy) and got anyone who showed interest to give me their e-mail. I made a d-list and have been sending them peak oil stuff. When they saw me start working out to get in shape like the guy in "Post-Oil Man" they saw I was serious, and now we have most everyone working out. Some of them are not on the d-list and are wondering what the hell is going on. They don't want to believe but they see so many people doing something about it, it's starting to disturb them. Also, the non-believers are not just hearing it from me, they are hearing about it from everyone on the d-list.

I don't know if Matt Simmons is a Mormon, but it wouldn't surprise me. He's originally from Utah.

Pisani: Does Saudi Arabia have as much oil as they claim to have?

Simmons: They probably do. That isn't the issue....
[he goes on to discuss the importance of production flows and oil quality]

If the Saudis have the oil, then it really does come down to investment. i.e. If the Saudis declared open season on their resources to foreign companies, peak might be pushed out (and may end up sharper on the eventual downside).

But the King's recent behavior likely indicates that KSA is really going to proceed at their own pace. Which makes good economic sense. i.e. May flatten the peak and bring it on earlier. But could also make the peak less sharp.

Just my 2 cents.

Pisani: Does Saudi Arabia have as much oil as they claim to have?

Simmons: They probably do. That isn't the issue....
[he goes on to discuss the importance of production flows and oil quality]

That was priceless way to go Matt!
Side stepped the trap they always set and get right to the friggin point!!!THAT ISN'T THE ISSUE....less and slower flowing oil for a fast using world. Screeeech go the brakes. WTF mate where's my gas?

well observed ... flowers are underway

To be consistent with his writings, Simmons should have replied that the KSA MIGHT have the reserves they claim.

You are correct however about not getting caught up in that debate when the issue is about where 10,000 bbl per day wells are going to be drilled in the future? The KSA doesn't have the capacity to drill enough holes to achieve an undulating plateau if Ghawar is about to crash.

This statement by MS caught my ears. He didn't argue it, didn't wish to waste the time. I prefer to say he appeared anxious. No time to argue points that can't be known. Thats not a bad message, action.

The news cycle has been of interest. Today is Thursday, could carry over tomorrow and go to the Weekend. If there is some sort of special on one of the finance channels in the next couple of weeks that is as frank. could be a signal.

speaking of signals. I watched Charlie Rose tonight. He had a female guest on from the Carnegie Institution of Washington. World events and policy stuff. This statement (on its on) was in the tease for the show as it came on, and turned out to be the very last thing she said. Not exactly word for word, but close .

....the policies of Bush43 have been a failure and disaster. Its time to move on and look for a new direction for the New World Order. (for many that ears prick up time)

Is this news cycle and information cycle representative of a change of direction for the "Iron Triangle" as a member here likes to name it.

Also I think Matt Simmons and his understanding of SA probably heard what the King said before the assembly and the turning down of the State Dinner in his honor by Jr.

and the three articles Prof G. posted, if he has and thinks they have legs too. my my, I am beginning to feel that the King is "not throwing dirt in the umpires eyes" on this one.

A change is going to be made.

Quid Clarius Astris
Ubi Bene ibi patria

An expert told CNBC on Thursday that peak oil is the "the single biggest issue to threaten sustainable society" in the United States.

Connected or not, there was this back in Dec. that raised eyebrows.

Saudi Ambassador Abruptly Resigns, Leaves Washington

By Robin Wright
Washington Post Staff Writer
Tuesday, December 12, 2006; A23

Prince Turki al-Faisal, Saudi Arabia's ambassador to the United States, flew out of Washington yesterday after informing Secretary of State Condoleezza Rice and his staff that he would be leaving the post after only 15 months on the job, according to U.S. officials and foreign envoys. There has been no formal announcement from the kingdom.

The abrupt departure is particularly striking because his predecessor, Prince Bandar bin Sultan, spent 22 years on the job. The Saudi ambassador is one of the most influential diplomatic positions in Washington and is arguably the most important overseas post for the oil-rich desert kingdom.

Turki, a long-serving former intelligence chief, told his staff yesterday afternoon that he wanted to spend more time with his family, according to Arab diplomats. Colleagues said they were shocked at the decision.

Job description "intelligence chief" before becoming ambassador.

[link to]

Quid Clarius Astris
Ubi Bene ibi patria

Wow you can start to see the pieces fitting. GW has pissed off alot of people and we will suffer for decades because of him.

-sounds too much like that character in "Deep Impact" who goes off to 'spend time with his family 'cus he already knows about ELEs approach... :o)


-sounds too much like that character in "Deep Impact" who goes off to 'spend time with his family 'cus he already knows about ELEs approach... :o)


We know he read and liked the Saudi pieces.

Hi Stuart,

Thanks for sharing this.

I'd be interested to get Matt's take on "FF"'s posts, (which again I'd look up, except I can't on this computer.) Didn't FF say that his comments "re-wrote" part of "Twilight"?

Also, it would be nice to "have his ear" for a Q and A session. Do you suppose this might ever be possible?

Anyway, please pass along...gratitude and good wishes.

My local newspaper has been loosing weight- the last 2-3 weeks of during the week issues have been noticably thinner. Anyone else have the same thing? Iron triangle doing some reorganization of advertizing?

Does craigslist cover your city? They offer free classified advertising for most categories and you can submit photos. Newspapers simply cannot compete. And newspaper's headlines have likewise been superceded by online sources for sports, health, entertainment, world, national, and local news.

And why have all that paper accumulate around the house? Its a waste. My favorite computer magazine was PC Magazine. I recall issues many years ago that were over an inch thick. Now its more like a pamphlet.

Times change.

Hi D,

(May I post w/out looking up links? just this once?) Actually, the reply below is very partial. The major papers (and many small papers are owned by major conglomerates) are and have been bought out by corps, with focus on profits, which are actually quite large (and out of sync.). You can start researching this by looking at the websites of (okay, here are some links:, Lots written up on the impact of FCC rulings and corporate take-over and consolidation of media.

I watched Charlie Rose as well. The female guest was Jessica Tuchman Mathews, the daughter of Pulitizer Prize winner Barbara Tuchman, journalist and historian,

I think the emphasis on conservation is a little naive at this point. Maybe 10 or even 5 years ago it would have been a good point to make. If we peaked though, conservation will be the easy part. Conservation will happen whether we want it to or not and probably more quickly than any environment minded politician would have proposed. Whether we refuse to give up our SUVs or not. Whether we all switch to energy efficient lighting or not. Europe is the promised land of conservation and they have trouble just meeting the Kyoto targets. Things are speeding up and the word now is not conservation it's MITIGATION.

Pisani is so "Wackey Wackey" on this piece. I've never seen a journalist like that on PO before. Let's hope he keeps his word and don't let it go away.

It is important to understand that CNBC's role is that of a tout. This whole interview should be seen for what it is, an invitation to bring speculators into the energy futures. The exact same thing happened last year. I can't site appearances of peak oil discussion on CNBC then but I'd stake my life on the probability they such talk littered the network during the bull run in 06.

If you could get Pisani on the record about his own personal view of peak oil it is an absolute certainty he would say he doesn't believe it. Note he was well versed in all the anti peak arugements. Now that doesn't mean what he would say is what he believes, but he must adopt the party line. The party line being that there is pleny of oil for years to come.

However it is in the interests of some significant group on the street to get another bull run going in energy futures this year so Pisani he buried his reasoned scepticism, the party line, in blathering foaming at the mouth panic at the implications of peak oil.

Go ahead and discount all my cynicism, it doesn't really matter. The crimials will get richer in any case.

Its up to the general public on whom to believe:

a CEO of the largest oil company, or the CEO of an investment bank. Last time I checked bankers always win.

Simmons will be booked solid for the networks after this gets around.


"Peak Oil" -Google Trend indicator:

-have we reached a low point in searches?

Unfortunatley public debate is divided on this key fact and Google only reports search data upto the previous month -we will only really know after the event.

However, many 'Peakists' @ the Oil drum are saying we have already turned a corner and everyone will be talking and searching for -Peak- Oil soon... :o)


I like the timeline point of "F", January 5. "Is 2007 the time to get out of oil?". Mental note: don't take investment advice from resourceinvestor.

While it's pleasant enough to consider PO may be reaching the mainstream, I do have some concerns about the timing of this insofar as the MSM is concerned.

Foremost among these are the growing demands on the Bush administration to commit to an Iraq troop withdrawal timetable, and the growing tensions between Iran, and the US and the UK.

It seems indisputable that the administration, or those elements within it capable of controlling it, is committed to conflict with Iran. If this is true then it seems logical at this time to begin to unfold PO using the MSM to ensure it can be used to support an attack on Iran.

After all, not only is Iran trying to develop nuclear power and by extension weapons, it also has large reserves of oil the US, and possibly the west in general, will need to carry on as usual. The same logic could be applied to Iraq. The House is pushing the administration to leave and give up control of second largest reserves in the world.

Perhaps the MSM has been given the task, in whatever way these tasks are handed out, to get the word out to “the man on the street” that PO is here, it’s now, and if we leave Iraq, that would be bad. We’d give up all that oil. If we allow Iran to acquire nuclear, that would be bad. Take control of Iran by force and not only has the US eliminated the nuclear threat they’ve also added to their growing reserves in the Middle East.

While this may be a good thing, I still remember the WMD claims. For Iraq, I’m sure we all remember the rallying cry, Weapons of Mass Destruction. For Iran, perhaps WMD stands for Weapons of Mass Depletion. I will remain more than reticent to applaud the MSM for its apparently timely and factual reporting.

Do you know my wife? Sound just like her. Good point!
What if these ME guys decide that we are the problem no matter what we say, join forces to oust the "infidels", they can go back to fighting between themselves after that is over with. I don't think the odds are good of having lotsa oil and really big wide war at the same time. The economic repercussions would be world wide. More countries would then have a stake in securring supplies or stopping the damage. Bush doesn't listen. Sends a chill down my spine. Ossama B may get his holy war.

If you don't want war, this is a bad thing. Since we have so much debt, everyone's getting out of the dollar and we won't be able to compete BIDDING for oil, if you still want 'life as you know it' to continue a while longer, this is a good thing. If we can't buy it we HAVE to take it. The world population needs to be reduced in a big way anyway.

Regarding gasoline shortages, something unusual seems to be going on in the ethanol market, at least compared to last year. Yesterday gas jumped up 7 cents, but ethanol barely moved. Could it be that the oil companies know that they will not have enough gas to blend with ethanol and are not bidding up the ethanol contracts? They get a .51/gal. tax break on each gallon of ethanol they blend so I would think they or speculators would bid up the price to match the gasoline rise. It may be that either there is too much ethanol or not enough gasoline. It's hard for me to believe there is an oversupply of ethanol already, but it could be. A shortage of gasoline seems to me to be the more likely explanation.

Ethanol market is very thinly traded....I would suspect that most deliveries are private contracts

Ahh - I think that people are getting too excited. Sure it may be a banner year for the GOM to be hit and more production taken offline. Sure it looks like someone may be waking up.
Rest assured that the general public is ASLEEP!

Why in the recent Engineering Dimensions Rag I saw this very reassuring comment by a "professional" engineer who must have gotten his climatology degree in his sleep:

"We have no choice but to get used to global warming, or cooling, as the case may be, because it is driven by natural forces and processes over which mere mortals have no input or control whatsoever."

His proof is that 210B tons of CO2 are generated naturally and only 6B tons by human and animal activity (from IPCC report) and so our production is insignificent.

Dollars to donuts that he looked at raw production instead of the balance of CO2 production which we've tipped.

Anyways - the Professional Engineers Ontario up here have been working to credential more and more people. It makes me sick and a piece of paper just means that you're willing to pay your money and tough it thru to get the degree.

Hi praetzel,

Speaking of donuts and such...

re: "His proof is that 210B tons of CO2 are generated naturally and only 6B tons by human and animal activity (from IPCC report) and so our production is insignificent"

Let's see...if this was a person, and they ate 210 units of the good stuff, (let's assume this is the persons optimum caloric intake, nutrition-wise...) and 6 units of "junk food" per long until obesity sets in?

Too your slant on things Aniya.

In other words, pretzel logic. Sorry praetzel, it was just too temping for an old lady who needs more humor in her life.

I'll go back to commiserating with my anole. And for those who may not know what that is, it is probably not what you are thinking. "King Tut" is an Alpha Male Anole who lives on my lanai--he's a really cool type of lizard with lots of personality and he's my good bud.