DrumBeat: May 1, 2007

Venezuela pulls control from Big Oil

President Hugo Chavez's government took over Venezuela's last remaining privately run oil fields today, intensifying a decisive struggle with big oil over one of the world's most lucrative deposits. The companies giving up control include BP, ConocoPhillips, Exxon Mobil and Chevron.

Fight Fire With Fire?

Will climate change doom humanity to an existence mimicking Dante's Inferno? Will nuclear proliferation threaten humanity with annihilation as depicted in Dr. Strangelove? An increasing number of pundits, policymakers and even environmentalists believe that nuclear energy can save us from massive death by climate change and will not lead to massive destruction by nuclear war. (Nuclear fuel making technologies can also be used to produce explosive material for nuclear weapons.) But as I wrote in a new Council on Foreign Relations report, Nuclear Energy: Balancing Benefits and Risks, this view oversells the contribution nuclear energy can make to strengthen energy security and reduce global warming while downplaying the dangers associated with this energy source.

CEO at BP steps down

John Browne resigns position after judge allows newspaper to publish details of his private life; Tony Hayward takes over.

Getting containers off road and up river

The U.S. Maritime Administration sees merit in the proposal, which would help reduce traffic and pollution and boost a U.S. Department of Transportation initiative to move more cargo via the nation's waterways. Only 2 percent o f the nation's freight now moves that way, with the rest moving on highways and railroads.

More pain at the pump

It was a monster fill for Marc Fischer's Ford Excursion.

When the pump came to a halt yesterday at a Columbia Exxon gas station, the bill was a whopper: $91.61. And it might continue to grow.

Chavez: China Okays US$6bn Oil E&P Fund

China has agreed with Venezuela to support a fund that would finance US$6bn in extra-heavy and heavy crude oil E&P projects, Venezuela's President Hugo Chavez said in a report from state news agency ABN.

Iran oil, gas production on the rise

Iran's oil production is expected to exceed 5.316 Mln barrels per day by the end of the country's 5th Development Plan (early 2015).

Gearing Up for Gulf Hurricanes: Offshore Technology Conference

In recent years, Gulf Coast hurricanes reminded oil companies and offshore drillers they are little match for Mother Nature.

But improvements in everything from weather forecasting to rig tie-downs may give the energy industry more of a fighting chance this hurricane season.

Kurds will vote against oil law

While Baghdad warns regional governments not to sign oil and gas contracts, the Kurds say they will vote against the draft oil law.

Philippins: Pimentel says coal import could bankroll TU campaign

Senate Minority Leader Aquilino Pimentel Jr expressed fear that the alleged artificial shortage in coal supply could be used in raising funds for administration candidates in the May 14 elections.

Germany in losing battle to save glacier

The winds are cold at any time of the year on Germany's highest mountain but the country's last glacier is melting away despite Herculean efforts to counter the effects of climate change.

Seeing the trees for the forest: WHRC scientists creating national biomass and carbon dataset

After completing a two-year pilot phase, scientists at the Woods Hole Research Center are expanding the scope of the "National Biomass and Carbon Dataset" for the year 2000 (NBCD2000), the first ever inventory of its kind, by moving into the production phase. Through a combination of NASA satellite datasets, topographic survey data, land use/land cover data, and extensive forest inventory data collected by the U.S. Forest Service – Forest Inventory and Analysis Program (FIA), NBCD2000 will be an invaluable baseline data set for the assessment of the carbon stock in U.S. forest vegetation and will improve current methods of determining carbon flux between vegetation and the atmosphere.

India: RIL plans to start production of coal bed methane by 2009

In a move that could have some bearing on the future of the energy sector in India, Reliance Industries Ltd (RIL) plans to start commercial production of six million metric standard cubic metres per day (mmscmd) of gas from its coal bed methane (CBM) block in Madhya Pradesh by 2009, said an executive of the company who did not wish to be identified. The Mukesh Ambani-controlled company will be among the country’s first to commercially extract CBM, a fuel that is akin to natural gas, only less polluting.

Enough Electricity for Five Times World Demand

While the world annually consumes roughly 14,000 terawatt hours (tWh) of electricity, the yearly potential electricity generated from tidal currents has been estimated at 80,000 tWh.

Willem Middelkoop looks behind the scenes of the economy

Daan de Wit: But the price of oil?

Willem Middelkoop: In my opinion it can only go higher, and that's not including what ends up happening with Iran. I follow the data on worldwide supply and demand, and for the first time we've arrived at a situation in which the demand for oil has exceeded supply for three years running. We've talked often about peak oil and possible problems in the future if the demand is greater than the supply. But the future is now, because in 2006 the demand for oil was 100,000 barrels greater than the supply. We're talking about 100,000 barrels per day. This year the shortage is up to 700,000 barrels per day, and for next year yet another shortfall is predicted. So that's three years in a row with an oil shortage. And then the last thing we'll need is another conflict in the Persian Gulf.

Dancing with Fairies

In recent months we at SRA have received a growing number of requests to address the question of peaking world oil production from a political point of view. To wit, is not peak oil just another wheeze to create a crisis that would facilitate the creation of global government? Isn’t it just a means to discredit global warming activism? Don’t the banks and oil companies have a vested interest in promoting the idea of Peak Oil to get prices up? I may be missing some of the questions and comments in this brief synopsis, but basically these three points seem to pretty well encapsulate the sorts of feedback we have been getting.

Back to the Cold War? Putin's Policies Head in a Dark Direction

It's difficult to avoid the impression that with Russia, we may be gravitating toward a new cold war. Flush with cash as a result of soaring energy prices, Prime Minister Vladimir Putin behaves like a man who is utterly unconstrained by "world opinion" (however defined), or the possibility of incurring Washington's wrath.

Azerbaijan in the National Energy Policy of the USA

The energy turmoil of 2000-2001 prompted Bush to establish the National Energy Policy Development Group (NEPDG), a task force of senior government representatives charged with developing a long-range plan to meet U.S. energy requirements. To head this group, Bush picked his closest political adviser, Vice President Dick Cheney. A Republican Party stalwart and a former secretary of Defence, Cheney had served as chairman and chief executive officer of the Halliburton Co., an oilfield services firm, before joining the Bush campaign in 2000. As such, Cheney availed himself of top executives of energy firms, such as Enron Corp., for advice on major issues.

Hotels in Costa Rica Worried About Energy Rationing

They're afraid their guests will cancel reservations as they learn of Costa Rica's energy crisis, which has been evident since an unplanned massive blackout occurred April 19. Smaller, scheduled blackouts have since become the norm as the Costa Rican Electricity Institute (ICE) rations the country's insufficient energy supply.

Alternative fuels find home in La.

Within the last year, two companies in the West Monroe area have announced plans to build manufacturing facilities that turn agricultural and wood waste into alternative energy products.

The Downside of Biofuel

Ethanol may not be the solution the administration is looking for. In fact, production of the additive brings with it a host of challenges. Challenges that could leave environmentalists, farmers and possibly even consumers frustrated and disappointed.

Ghana: Power crisis no excuse

The Chief Executive Officer of the Ghana Investment Promotion Centre (GIPC), Mr. Robert Ahomka-Lindsay has asked Ghanaian industries to stop using the current energy crisis as an excuse, and use other available opportunities for their growth.

Chile's Hydroelectric Projects: Indispensible

Plans to build at least five massive hydroelectric dams in Chile’s Region XI have generated harsh criticism from many sources - national and international, as can be seen in today’s lead story. Critics are asking a simple question: Why does Chile have to repeat the energy development mistakes made in Europe, North America, and Asia, when energy efficiency and renewable energy sources are finally coming into their own due to high fossil fuel costs? What about low impact hydro, thermal, wind, tide and solar energy sources – especially now that climate change problems are finally beginning to be recognized around the world?

A Pair of Leggy Drillers

It's not a new message from T. Boone Pickens, but it's a difficult one to refute. For a while, Pickens has been circling North America sharing his thoughts about the phenomenon of peak oil. The term refers to the point at which our planet's increasingly voracious appetite for oil begins to exceed the ability of the world's oil companies -- private and government-owned -- to produce it.

World Without Oil Launches

Last night at midnight, the alternate reality game (ARG for short) World Without Oil launched. In the game, the world has hit peak oil and there are news reports of crises from around the world. The goal of the game is to get real people around the world to start thinking about life without oil. To get them to answer questions like: How will they cope? What will they have to sacrifice? What can they do to help the world?

Book Review: The Coming Economic Collapse

Author Stephen Leeb makes an argument for why crude will reach $200 and how an investor can profit from that. He spends about 80 percent of The Coming Economic Collapse establishing the argument for peak oil and the rest on how to profit – as absurd as that may sound.

Why not make mass transit always free?

In the age of global warming, increasing gasoline prices, and (though I am personally a skeptic) the concerns about "peak oil", the supposedly progressive San Francisco Bay Area is living in the virtual mass transit dark ages. The damage to the MacArthur Maze in west Oakland will only make that more obvious to everyone.

Is An Alternative Energy Bubble On the Horizon?

With Al Gore's 'An Inconvenient Truth' sweeping Hollywood and monster storms swamping coastlines, global warming is nearly impossible to ignore anymore. Add to this perennial Middle East tensions and peak oil fears and you've got the perfect recipe for a looming energy crisis. How do we save the world and still live our energy-dependent, modern lifestyles? Many corporations, venture capitalists and individual investors believe that cleantech is the answer.

The Year of Magical Eating: The 100-mile diet and other food stunts

Those who defend the pleasures and economies of modern life against the romanticizers of a zero-impact, local eating, fresh fruits and veggies past often overemphasize the soul-numbing drudgery of rural life. Picking berries and turning them into jam while chatting with a friend has been one of womankind's great pleasures for centuries. But just because it isn't awful doesn't mean that it isn't time-consuming labor. And in modern times, laying a hand on local berries in the first place can be pricey, U-Pick or not.

Thanksgiving in the Gas Tank

Are plants the power source of the future? Biomass could be one solution to our dependency on fossil fuels. Though biodiesel from rapeseed and alcohol from grains are uneconomical and hardly less harmful to the environment than gasoline, second-generation production methods are now fueling a new optimism.

George Monbiot - The rich world's policy on greenhouse gas now seems clear: millions will die

Our governments have set the wrong targets to tackle climate change using outdated science, and they know it.

Arctic melt faster than forecast

Since 1979, the Arctic has been losing summer ice at about 9% per decade, but models on average produce a melting rate less than half that figure.

The scientists suggest forecasts from the Intergovernmental Panel on Climate Change (IPCC) may be too cautious.

Canada climate change plan is questioned

The head of the international body that oversees the Kyoto treaty said Monday that Canada's new climate change plan does not guarantee that greenhouse gas emissions will decrease.

Annual pump price rise is fast, furious this year

With prices in many parts of the country, especially on the West Coast, already well above $3 a gallon, some of the most pessimistic forecasts calling for peaks above $4 a gallon in some locations.

“I think it’s probably one of the worst-looking years we’ve seen," said Antoine Halff, head of energy research at futures broker Fimat. "And that's probably why you’re seeing more apocalyptic forecasts than is typically the case.”

Oil Companies Created 'Shortage' That Is Driving Record Pump Prices, Says Group

Even as crude oil prices fell slightly today, gasoline prices continued a rocket trajectory upward due to "supply shortages" resulting from a combination of ineptness and greed on the part of oil companies, said the Foundation for Taxpayer and Consumer Rights.

Many methods, one basic idea shape new oil-shale technology

If you’re not going to mine it, you’ve got to heat it in the ground before you pump it out.

That’s the general plan for Royal Dutch Shell, EGL Resources, Chevron and possibly ExxonMobil. Each company hopes to relieve Colorado’s Green River Formation of its hydrocarbon-rich marlstone, or carbonate mud.

Japan follows Korea's path to Middle East oil security

Japan's plan to lease out some of its oil storage facilities to Saudi Arabia and secure longer-term supply deals show Tokyo taking a page out of Seoul's book on how to cut costs in its quest for energy security.

After decades of attempting to protect itself from oil supply disruptions by buying overseas fields or spending billions on government and industry stockpiles, Tokyo appears to be taking a new, more commercial tack in an increasingly competitive world.

6 oil workers kidnapped in Nigeria

Gunmen armed with dynamite seized six foreign workers and killed a Nigerian sailor in an attack on a Chevron Corp. ship in Nigeria's southern oil-producing region, a navy spokesman said.

Capt. Obiora Medani said the ship was attacked off Bayelsa state where it was serving as a container for crude oil.

Saudi says oil security main topic at Riyadh meeting

Security of oil supplies will be a core topic at a meeting of Asian oil exporters and consumers in OPEC kingpin Saudi Arabia this week, the Saudi oil minister said in remarks broadcast on Monday.

Rich Oilfield Discovered in Northern Kuwait

Kuwaiti Minister of Oil Sheikh Ali Al-Jarrah Al-Sabah announced Monday that a rich oil field was discovered in northern Kuwait, the official KUNA news agency reported.

In a statement, Sheikh Ali Al-Jarrah said that initial examination of the site proved it contained a huge amount of light oil and affiliate gas, but he did not release the reserves of the new field.

Nations urged to reduce greenhouse gases

The European Union called on developing countries Tuesday to take immediate steps to reduce greenhouse gases, saying they must stop blaming richer nations for their own failure to act.

Poor countries demand a voice on climate change

As climate change experts meet in Bangkok, poor nations suffering the brunt of global warming's worst effects are determined their voices will not be drowned out by bickering world powers.

Climate change threatens Indonesian rice farmers: study

Indonesian rice farmers in Java and Bali must invest in hardier crops and better water storage methods if they hope to maintain harvests in the face of manmade climate change and weather systems such as El Nino, according to a new study.

Chinese puzzle bamboozles U.N. climate talks

U.N. talks on climate change are at risk of bogging down under the weight of hundreds of amendments from governments and China's objections to a proposed blueprint for battling global warming, a senior delegate said on Tuesday.

A Black History of Our Oil Addiction

MP3 audio interview with Edwin Black, author of Internal Combustion on the electric car conspiracy.

That's an interesting pattern on that chart. I hope we hit $4/Gallon this summer.

$4 a gallon doesn't sound much for Europeans.

However if we had three times higher prices since 2002 today, as the chart shows for the US, that would mean 3,60 Euros a litre (more than $10/gallon).

In sweden the gasoline price since 2002 has not jumped much at all. The price as i recall it 2002 was about 10 krona/litre, summer 2006 it was breafly 12 krona/litre. Today when i filled my car it was 11,88 krona/litre. So the price rise here is propably not much more than the usual inflation. Gasoline is still cheap.

The price rise in USA must mostly be dependent of the decent of the USD value since 2002.

Gasoline isn't the only thing that will be rising in the near future. What a train wreck!
ELP anyone?

The war for your electric bill

Oh! Poor texas with their high electric rates of 12 plus cents per kilowatt. Try 32 cents on to see a good jump in your bill. We seem to be able to cope with these rates so far, but it will just be more heat to the fire as peak unravels. I'm putting in a 125 KW hydro unit. At least we will have electricity.

If you would like some technical assistance, let me know. My eMail is under my name if you click it. Perhaps we can talk.

Best Hopes,


Is the seasonality of the past couple of years something new, or was the non-seasonality of the few preceeding years the exception?

If the seasonality is emergent, what is causing it? More and longer vacation driving? More hurricane evacuations? Or something else?

My guess: with supply now very close to the inelastic demand, slight changes in either can cause major price swings. Seasonal driving patterns in the USA cause such changes in demand. Hurricanes and wars cause changes in supply, but that's not as reliably "seasonal".

We can call it the "Peak Oil Buzzsaw."

Each spike slices through what's left of discretionary income and leaves the US economy in an increasing morass of bloody tatters.



Superimpose a supply chart over the price chart and it becomes obvious what is happening.

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

I hope we hit $4/Gallon this summer.

Frankly, so do I, as I believe price is the only thing that will get people's attention and cause them to conserve.

FYI, I have published an analysis of what I think we will see with tomorrow's report, as well as why the gasoline situation does not support the "Peak Now" view. It doesn't disprove it either, but I believe those who think it supports a current oil peak are misreading the situation. It wouldn't help us one iota at the moment for Saudi to open the taps. We have to get current crude inventories headed down first, and we can only do this by getting refinery utilization back up. See my analysis at:

My Views on the Gasoline Inventory Situation

Also, Doug Macintyre, the author of This Week in Petroleum - and the guy who puts the EIA reports together - is again posting in the comments section following that essay. If you have a question about what's going on, he has been pretty good to answer them. As I pointed out in my latest essay, so far my price prognostications are ahead of his. :-)

Hi Robert,

I don't think the gasoline situation is directly related to Peak Oil either at the moment.

But one thing that does confuse me (re:KSA increasing production) is why did we draw so much from inventory in Jan and Feb 07(about 1MMBPD/80.5Million barrels in Feb)?

We can increase gasoline production, but if we are still drawing down crude inventory(OECD), isn't that going to squeeze eventually?

The crude inventory draw (OECD) is the area that concerns me most. So, to me, that is where the KSA question comes in, can they swing 1MMBPD to balance the equation!?

What do you see happening?

The crude inventory draw (OECD) is the area that concerns me most. So, to me, that is where the KSA question comes in, can they swing 1MMBPD to balance the equation!?

What do you see happening?

I notice that the OECD has reduced their demand forecast for 2007. But, if the OECD inventories continue to come down, Saudi will be called upon regardless of what's going on in the U.S. But we aren't going to be calling on them unless we start pulling our own inventories down. I hope we see a situation this year where they are definitely called upon to supply more oil, because that will start to answer a lot of questions.

Thanks. Yes, it would be nice to know one way or another if KSA has capacity left.

Right on. Consume More!

We have to get current crude inventories headed down first, and we can only do this by getting refinery utilization back up.

But what if refinery utilization can't be improved, if there are always other "facts on the ground"? Our whole system is so oil dependent it doesn't seem to me like lthat is any different than our being unable to find enough engineers, pipe or platforms from which to drill. We still max out on production. It's just another variation on the Law of Receeding Horizons, isn't it?

The more we depend on the efficiency of a monoculture the more vulnerable we will be to any disturbance - everything has to be exactly right to increase yield. Consequently the system as a whole peaks out just because a butterfly flaps its wings.

Yeah, we could produce more oil if we dumped it out of the wellhead onto the ground so we are not maxed out? The system has a certain amount of head; making it more efficient actually increases that head.

cfm in Gray, ME

The more we depend on the efficiency of a monoculture the more vulnerable we will be to any disturbance - everything has to be exactly right to increase yield. Consequently the system as a whole peaks out just because a butterfly flaps its wings.

Well said. This also applies to what's going on with imported European honey bees and our monoculture of corn. It's always good to have diversity in the system in order to deal with the breakdown of one piece. Leaves us with alternatives. The reason it is not part of business standard protocol is that it does not make as much money as quickly. This is one drawback of letting the market take care of things.

But what if refinery utilization can't be improved, if there are always other "facts on the ground"?

Like High Demand near 100% refinery ultilization together with just-in-time supply.
Like dealing with constantly evolving blending and quality requirements coupled with aging equiptment where personel experience and expertise are sometimes in short supply.
Like an ever increasing complex addition of refining steps and processes need to deal with steadily deteriorating crude quality in varying quantities from diverse sometimes intermittent sources.

Or all of this at once.
We could easily go through the same exercise with the crude supply side. So relatively, oil pumped more easily and was simpler to refine previously compared to the downslope of Hubbert's peak. As the number of moving parts increases total co-ordination is nearly unachievable. It's just possible that we are witnessing that the whole big fantastic machine is simply reaching the limits of it's own complex nature.

Title of new book:

"Peak Oil: Forced Global Simplification"


There is the Mom and Pop stations verses the Exxon's around here. The Mom and Pop have their highest Octane at (US)$2.98 and the Exxon has it at $3.22. Just goes to show you where the extra change is going, to the Exxon profit base.

When the mom and pop stations get over 4 bucks then I'll start to worry, but then again I have other things I can worry about if I have to go out and worry about things, I don't need the stomach upset, I try not to worry about anything.

But there is a lot of waste in the system, a lot of people can cut back a lot more than they are and then the demand will shrink to the bare bones. That has not happened yet, there is lots of slack in the ropes right now and after the summer when the belts have to be tightened then we will have to look at things again.

It's May! We're 2 years post C+C peak (assuming the stats aren't updated in the next few months).
We should have a party or something.

BYO light, sweet crude!! (Ignition sources will be provided)

Nice Vintage!

Matt Simmons on the Schlumberger Web site: Aging Rig Fleet, Slowdown in Drilling Sharpen Oil Peak.

http://carolynelefant1.typepad.com/renewablesoffshore/2007/04/ocean_ener... />Simmonds Ocean Energy Institute Proposed in Maine

Today was a big day for peak oil and hopefully the Ocean Energy beginning of how the world uses our oceans for energy and for Rockland and the investors in this real estate project.

Offshore Drilling Expansion Announced

WASHINGTON — The Interior Department announced a major expansion of offshore oil and gas development Monday with proposed lease sales covering 48 million new acres off Alaska, in the eastern Gulf of Mexico and in the central Atlantic off Virginia.

There was a discussion of the Washpost article here


This early question was striking

Phoenicia, N.Y.: If drilling off Va. coast will help people like myself who live outside cities to buy what is necessary for sustaining life by reducing the cost, I approve wholeheartedly. I am 80 years old and need to drive 23 miles just for food supplies. There is no place that I can go without using my car. Heating and gas cost for the home is outrageous. My husband is 83 and cannot afford to leave his menial job. Cannot have health ins., pay for meds, and keep up with utilities with costs as they are now just on SS. Shame on this country for allowing these conditions

but also there was this:

Arlington, Va.: Why is it that people cannot face the reality that we are entering the waning years of consuming an energy resource that millions of years of ancient biological and geological processes left for us? It's okay (in my opinion) to go to extreme lengths to suck every last bit of valuable substance out of the earth and burn it up. But, then what? Most people think something magical will happen and we will figure out a way to conjure an energy source as dense and convenient as fossil fuels out of something. I believe it is wishful thinking. But, I don't have kids, and am old and probably won't live to see the hardship that the next generation will have to endure because of the way we squandered the resources that time had given us. It used to be that 'the press' would analyze these type of issues and people actually thought some about what kind of world they would leave to their offspring. Again, I'm glad I won't live to see it, but it is sad.

So, according to the Taxpayer and Consumer rights group, the oil companies are purposely creating a shortage. Good. I'm glad someone is taking the bull by the horns and doing what we should be doing as part of public policy.

Raise the gas tax and do it on a percentage, not a fixed basis. Consequently, at least, the revenues from same will rise in direct proportion to gas prices. Use the revenue from same to reduce income taxes for the middle and lower classes and/or use the revenue for conservation projects,transit, and some forms of alternative energy research.

Is there any hope in talking sense into these 'comsumer' groups ? Are any of you out there a member of


What exactly are 'consumer rights', which is what you lobby for ?

What exactly are 'consumer rights', which is what you lobby for ?

I have followed this group for a long time, and have written a number of essays demonstrating their cluelessness:

Essays on the FTCR

Basically, they are on the record saying that gasoline should be less than $2.00 a gallon for all Americans (a direct quote from them) and yet they also state that burning gasoline is harmful for the environment. Apparently, they can't seem to see the contradiction here. But, as I have pointed out before, they have no technical expertise on their staff. As someone wrote to me in an e-mail, the CVs of the staff indicate the following degrees:

Political Science
Sociology and Law
Cultural Anthropology and Rhetoric
Fine Arts
Philosopy and Communication Management
Business and Marketing

Yet they think they know something about running an oil business - such that benefits to consumers, not to shareholders (nor the environment for that matter) are all that matters.

I have also noticed them deleting comments from their site from people who challenge their arguments. I had thought about registering there and challenging their logic until I saw them doing that.

I'm not familiar with this group. I personally associate with the group that publishes Consumer Reports. (consumersunion.org)

In anycase, don't take these people to be indicative of broader "consumer rights" movements.

I would personally like to know more about why new refineries are not going up in the US despite the much higher prices. I would also like to know why companies were not ratcheting up gasoline imports much earlier? Everyone knew refineries would be going offline to switch over to summer blends, and people already knew that gasoline demand was up from last year.

What went wrong in the predictions that caused the inventories to drop so much more than was expected? was it more refineries being down for longer periods than was expected? was it a supply issue with the foreign gasoline imports?

If it was a foreign supply issue, what is constraining our ability to import foreign gasoline? Are we looking at a global crunch on refinery capacity, not just a domestic one?

If anybody can help me with those questions, that would be awesome.

I would personally like to know more about why new refineries are not going up in the US despite the much higher prices.

A lot of refining capacity has been added:

Tyson Slocum is Wrong

The bigger problem is that oil companies have underestimated where prices would be. I know this for a fact, because I have seen some of the economics of various projects. They were forecasting $35 oil when it was actually $60. So what will cause you to underinvest. And when oil prices do come in much higher than forecast, it takes time to get capacity installed. Not helping matters is that everyone else is trying to do the same thing at the same time.

I would also like to know why companies were not ratcheting up gasoline imports much earlier?

It's not generally oil companies importing gasoline, it's exporters from Europe selling it into the U.S. market. We saw an unusual situation over the winter of high demand, and mild prices. Mild prices do not attract imports.

What went wrong in the predictions that caused the inventories to drop so much more than was expected? was it more refineries being down for longer periods than was expected? was it a supply issue with the foreign gasoline imports?

A little bit of those, and record demand. I detailed all of this issues in my blog posting from today.

Hope that helps. That's all from me today.

thanks for the extra info. For much of the last few weeks, all I've heard about why the prices are going up has been that inventory is going down. That just seems like it is question begging about why inventory is going down.

Your answers go a long way towards clearing that up.

So I guess the oil companies thought that prices would be low AND demand would be weak. Maybe some basic knowledge of economics does have some value.

No doubt there are some ways in which the current amount of supply could have been ratcheted up. On the other hand, the oil companies, despite their expertise, do not necessarily possess an ever accurate crystal ball.

Having said that, I don't care if the oil companies do a good job or not in forecasting demand or adding new refinery capacity. We need to find ways to reduce demand to way below what is currently produced and imported. As far as I am concerned, if the oil companies engineered a supply crunch and kept it that way, that would be a positive step forward. But it is not their responsibility. As long as the American consumer keeps whining and demands more supply and cheaper prices and no government intervention, we are going to continue to have problems.

As far as refineries go, let's put all future capacity in the backyards of those who are screaming for more supply and are convinced that this is a big conspiracy.

We need to get serious about cutting our oil/energy use and doing something real about global warming. Our goal should be to make most of this refinery capacity obsolete.

"Consumer rights" is an oxymoron. Consumers don't have rights. DOH. Citizens have rights. People have rights. The environment has standing - at least in parts of PA. But consumers? Let them eat melamine.

cfm in Gray, ME

Slightly OT - Is there any substance at all to ultra deep drilling for oil? Would this add much to possible reserves/flow rates worldwide?

"You can never solve a problem on the level on which it was created."
Albert Einstein

Simmons doesn't seem to think so


Now the drilling industry is prosperous--in 1990 utilization was at 98%--but the fleet is getting old. There are 51 rigs that are 18 years old, and 34 are 10 years old. Most are older. And as always, deepwater rigs are just a fraction of the fleet, despite the industry's move into deeper and deeper waters.

My impression is that these folks are basically "plaintiff's lawyers" groups masking as "consumer groups". If you don't get the "rights" they think you should have, you sue.

"The Foundation for Taxpayer and Consumer Rights" are just showing how little they know about anything. If you tried explaining to one of them the difference between refining light vs heavy crude, I bet you'd either be met with a blank stare, or get a quote from 'Black Gold Stranglehold' by Corsi.

But the oil companies are themself to blame for this nonsense, by denying there are mounting supply problems its only to be expected people will turn to conspiracy teories to explain rising prices.

Gotta do it. The fee-bate idea lately posted by mbkennel looks interesting. Then there's those ration tickets from the 70's. Need something simple/straightforward, probably be hastily done.


My article "Our Finite World: Implications for Actuaries" is the lead article in the May/June issue of Contingencies magazine, out today.

Evidence is building from the physical sciences that we are starting to reach some of earth’s limits. Unless we can find some technological solutions, once these limits are reached, we can expect to see a very changed world. Instead of having constantly increasing resources available to us, we can expect ever-decreasing resources to be available. Instead of seeing year after year of growth, increasing longevity, and improving morbidity, we can expect the opposite.

Congratuations. I've always wondered why more actuaries don't recognize the energy problems we face. Measuring risk and putting a value to it is their forte, and the risks inherent to energy are tremendous (I see it all as a matter of timing, so lack of preparation puts the problems on us before the solutions are ready). I think a large part of the problem is traditional economics and the assumption of infinite growth (which your article takes on).

My background: I used to be an acturial student but moved into systems and I'm now working at a large reinsurer in the mid-west. I have my Oil Poster proudly displayed and talk about it when asked, although I haven't brought up the topic with any other actuaries I know.

I'm going to have to ask around and get a physical copy of the issue for my personal records.

Congratulations Gail, and well deserved. You've put together some really coherent articles that are great introductions to those unfamiliar with peak oil. My father is an actuary too, and your material was the perfect motivation to introduce him to the subject. I'm still waiting for his feedback on it, but hopefully it will enable us to at least discuss the subject without him dismissing it as "just more chicken little".


I would be most interested in the response you get over the next few weeks from your colleagues. Mind giving us a follow-up?

I got less response than I expected with my first article a year ago, aimed at a more general insurance executive audience.

I'm not sure if it will be better this time. I'll let you know. My article is in a different publication this time, and the peak oil story is getting out more.

A strange energy related twist on the race for the moon, and one that could have a chilling effect on future cooperation in space. Further, you have a Russian official concerned with US interest in space as he says it will put the US in a position of energy dominance over the rest of the world in 20 years as hydro-carbons are running out.


Granted, the position of the US on fusion power is cautious, but the Russians seem to have gotten in a real tizzy about US refusal for a joint moon exploratory mission.

Apparently Helium 3 is a pretty sought after material in fusion research.

My article posted on TOD yesterday as "Our World Is Finite: Is This a Problem?" is currently the winner of the blogs on the WorldWithoutOil website. It is listed as "An analytical view of implications".

I posted a link to Dmitry Orlov's article "Closing the Collapse Gap: The USSR Was Better Prepared for Peak Oil the the US" (giving credit to him) on that web site today. We'll see how it does.

does anybody "get" the world without oil game? I'm a bit confused . . .

Okay I know we're in for a major economic ass-fucking, to say it politely. I can log onto any of the PO newssites to read about in gruesome detail . . . I can see that from my upper middle class climate controlled apartment/home I am not very insulated from the effects, at least nowhere near as insulated as I'd like to think I am . . . . . Why do I want to simulate what is happening?

If the goal is to "prepare" for what is coming, then wouldn't I start reskilling, or saving money to relocate or whatever?

Maybe as the game develops I'll "get it" but for now I'm sort of confused.

Hi Chimp,

I think it is less a game, than an interactive educational symposium with a goal of awareness.

But you are right, we will see where they are going with this. It is only supposed to run for 30 days, I think.

Stop making excuses about how lack of energy is going to ruin your life. Get with the program!!

The Chief Executive Officer of the Ghana Investment Promotion Centre (GIPC), Mr. Robert Ahomka-Lindsay has asked Ghanaian industries to stop using the current energy crisis as an excuse, and use other available opportunities for their growth.

Unfortunately, the only people who don't require energy are dead people.

An economy driven by dead people?? hmmm... soylent diesel??

Well, I did come up with an idea for free unlimited energy. All you have to do is put permanent magnets in the pockets of the founding fathers, and then put copper coils around their caskets!

Does your cynicism know no bounds!?!

"You can never solve a problem on the level on which it was created."
Albert Einstein

Dawn of the dead!

As I have said before, I think that almost all of us--to some extent--are in POD (Peak Oil Denial) Land.

It's one thing to look at the Lower 48 and North Sea case histories--where no amount of "improved technology" has reversed the crude oil declines--and to use them as models for the world, but it's quite another thing to actually grasp the consequences of a permanent decline in conventional world crude oil production.

Think of someone buying a new H2 Hummer--current cost, somewhere north of $1.50 per mile--on a four year loan. During the term of this 48 month loan, based on the HL model, at our current rate of consumption we will consume 10% of all remaining conventional world crude oil reserves.

Meanwhile, Car and Driver Magazine has a column in this month's issue, quoting a study (either Reason Foundation or Cato Institute, forgot which one), that states that what we need are more roads to ease traffic congestion.

WT: I might have POD syndrome, but IMO the problems are overstated. Realistically, the USA is the only country with widespread suburbia so obviously there will be a painful restructuring toward a more densely packed living arrangement for most Americans. This is pretty well the way Europe and Asia is already living, and the sky doesn't fall. Again IMO, a lot of things that many Americans think are fates worse than death (living in a small apartment without a car) are not that bad. Some of the problems are psychological, not economic or physical.


I don't know that you're in denial so much as I think you don't understand the problem and how it will effect industrialized societies, including your own.

The last global oil war (WW II) ended with most of Europe in ruins and a regional nuclear holocaust in Asia.

The difference between now and then is back then we had lots of oil left after the war to rebuild, today we have 20,000 nuclear bombs.

Plus - you guys all have guns. You don't need to nuke anyone else to trash everything. Once the bored delinquents learn that there arent enough police to cope with widespread problems, expect 'dodge city' or 'Escape from NY' etc.

At least in the UK it's only the criminals who have guns..

cheers all

I might have POD syndrome, but IMO the problems are overstated.

You are in denial all right. Do some research on the connection between oil and food production and human populations. I think you'll see what a catastrophic situation we are facing. Start with this:


Or remain in denial and think we just have a "painful readjustment" period to go through if that makes you feel better.

Solar:"We" are facing? Currently, 50% of the planet's population is so poor they would eat dirt. If you divided up all the material wealth on the planet equally, everyone would be poor. Beverly Hills isn't Zimbabwe.Globally speaking, there is no "we" and there never has been.

You don't get it? People can't live on dirt. They need food. Oil=food. Without oil about 5.5 billion of us have to go. And yes that means you and me too.

Strange as it might sound, 'Oil=food' is incorrect. Food=food. Oil has been used in food production, depending on your perspective, for roughly 50 to 100 years.

And peak oil does not equal no oil - it means declining amounts of oil coming out of the pipeline.

There may not be many grounds for optimism how that oil will be used, but oil production at 1960 levels does not directly mean 2 billion dead through starvation.

What it does mean, beyond question, is that Americans will be living very differently than it does today, and most other people somewhat differently to not very differently at all. (For example, a Brazilian sugar cane cutter probably won't notice too much difference.) This is not quite the end of the world, by the way. It is the end of the American Dream, which most Americans seem to believe means the beginning of a nightmare.

I really have to keep taking issue with people who think this isn't going to be so bad. How many on this list have been making a serious effort to produce food without using oil? I have, it's not easy. How many have tried to get their neighbors to at least put in a garden? I've tried this too, not much luck.

It's not like we can just all become Amish farmers when the need arises. It takes many years of practice to produce a consistent crop. Here in the US almost no one is prepared to take up farming. Most have no access to land for one thing. The same is true in other industrialized countries.

Sure, there's going to be oil around for a long time. And there will be efforts to keep the food production up as long as possible. It'll start to get expensive, and the poor will be the first to find food unavailable. That will lead to violence which will cause the system to collapse faster and more people hungry, more violence, etc. as things spiral downward.

Believe me I would love to think of a way to live out my natural lifespan in peace (I'm 47) but it isn't in the cards. If you have access to land, are in a remote location, have become extremely proficient in food production and preservation, are surrounded by a community of some sort to protect you, and are extremely lucky then maybe you survive. That's how I see it.

Solar: Try reading Nate's thread on placebos. Since you are convinced that you are doomed, you're right.

I'm not a peak oil denier. I'm also not a doomer. I have resorted in believing in the emergence of a near-term miraculous techno-fix. Ok... I'm half joking but a techno-fix would be really neat.

No really though... We're all going to die sooner or later. I look at peak oil as an interesting challenge. How do I survive the next 40 or so years of my natural life expectancy. Besides, many people spend their whole lives trying to convince themselves that their lives are not absurd. Accepting the absurdity of death and pestilence makes life so much easier. I recommend "The Plague" by Camus as a good allegory for peak oil.


I think it would be impossible to function without at least a bit of denial.

I agree too.

I hope for miracles, or that I am just crazy. The reality is just depressing.

So everyday, I dose myself with the hope for another BAU day.

It is so wrong :-P

PS: I will also accept little green aliens arrive with Mr. Fusion...or is that just another miracle...BAH! Maybe I am crazy...here's hoping.

Don't get your hopes up. I put Mr. Fusion on my Christmas list every year (seriously), but it nevers show up, never.
Maybe I will ask for a flux capacitor next year :-/

Pssst. DelusionaL. Just between you and me, I found a way to manufacture dilithium crystals. Honest. I am a little short of cash, but if you could send me $50,000, you will be a wealthy person--beyond your wildest dreams.

I think it would be impossible to function without at least a bit of denial.


The sweetest kind of denial is the one that denies it.

a psychiatrist friend who did neuro exams for auto accident said we couldn't drive w/o denial.

I am not in POD(i believe). I worrie most of how i can get gasoline to my small floatplane in the years to come. The car we can switch to an electrical, but the airplane is more problematic.

that is my concern as well--fuel for the plane. Now paying about $4.25 for 100LL. What is it costing you?

I have an american Rans Coyote II Kitplane with a Rotax 912 UL motor, which is constructed for MOGAS, so i use car gasoline. But the cost of 100 LL in Sweden is about 9 krona/litre(one gallon=3,8 litre and one USD= 6.8 krona) so i guess it is about 5 dollars/gallon here.

BTW i have flown Cessnas earlier(182 and 172), i would suggest, that you, if you own a 185 sell it as fast as you can, and instead buy a small light sportplane. My floatplane takes 15 litres/hour=about 3,9 gallon.

Best Kenneth

EDIT: Sweden has no tax on aviation fuels, but EU has taxes on aviation fuels for leisure flying. For example in Germany 100 LL costs the double than in Sweden, but next year Sweden must also tax AVGAS like other EU countrys. So the costs will go up considerably.

Building RV-7 w/180hp now, 200mph on 8 gallons per hour, so 25mpg. Now get about 12 mpg @13-14 gallons per hour but can haul 1000 lbs of people and gear with full tanks. Nice for back-country/wilderness flying in Idaho, Montana and BC. Looking forward to the speed and economy of the RV-7.

Wow! That sounds fast flying. Mine is 75 knots/h(the floats takes down the speed).I can haul 400 lbs with full tanks.
Good luck with the RV-7. Hope you have gasoline for it in the years to come.

Here is a template story for any white male living in Southern California:

A gang of Hispanics broke into my apartment/house and killed me. The end.

I don't get it either. Other then some copy and paste the original content seems to be very infantile.
Maybe they are just trying to make a buck with slick web design? or are they a bunch of puppies lost in the woods?

Maybe at some point it becomes clear.

Very cool!

Concerning the "Annual pump price rise is fast, furious this year" article on MSNBC:

If you want a good scare, read the reader comments regarding this article at


It is amazing to me that people can cook up the craziest, most imaginative conspiracy theories, but they NEVER discuss the simpler possibility of an inherent supply side problem (aka peak oil).

It is also amazing how many people expect some outside force to take care of them: "SOMEONE should do SOMETHING". Yeah right.

It just goes to show that, although most of us here read this site daily and know all of the major issues and feel like we are pretty immersed in peak oil as a concept, the average joe in the U.S. still has no clue. Scary.

I got to the 3rd page and I had alls I could stands. The posters remind me of the kid that wouldnt walk 50 feet to the ATM. They all want something for nothing. When I read crap like that, I lose faith in evolution.

Boycott Citgo

Ahhh here we go! Yet another "I'm the consumer and I can make a difference!" piece. Boycott Citgo? Yea, that wont drive the price of gasoline up even higher! "Consumers" are SO self-defeating.

Solution: Work toward changing your label from consumer to producer. Or at least move closer to work and ride a bike.

My favorite laugh:

"There is no reason for Gas to ever be over .30 Cents a Gallon any where in the United States. we need to Tax all oil companies 100% of every dime of profit over $100,00.00 every year. Also there is a Hydrogen Adaptor out there that makes a closed Hydrogen Run car available to every American from 1990 to present day. You can fill up with a garden hose and all exhaust is water vapor. The congress and senate won't let it happen because the oil companies pay them to keep it off the market. The Congress does not want us to drive for free because than they can not tax us for the Gas we use."

Was it one of them laughs that ends with "ohhh man we are f-in screwed"?

That was my reaction. Then this quote from the movie "Pitch Black" then popped into my head.

Riddick: "I truly don't know what's gonna happen when the lights go out Carolyn but I do know, once the dying starts, this little psycho f*** family of ours is gonna rip itself apart."


I would be curious to see how that person would react to questions about the 'Hydrogen Adapter', how it works, how they know about it, how to build one, etc. Would their head explode?

It makes me think of someone suggesting that there are flying cars but that they have been suppressed so that the companies that service roads don't go out of business. It's this kind of crap that makes real conspiracies so hard to detect.

Perhaps there should be a law prohibiting dumb people from suggesting new conspiracies. A rider that requires proper grammar in popular music lyrics would also be good.

I tried that garden hose thing. It didn't burn any more gas all day :0
It'd be major progress just to get these folks to POD.

Yes, it is people like these that should give you an idea of what we will have to deal with when TSHTF.

1. PO
2. corporate cleptocracy as a one party political system
3. third world demographics

What a cocktail, one little spark and the whole thing goes up in smoke, eh?

and then survivalists are nuts?

Welcome to Ringling Bros. Barnum and Bailey last show.

Re: Kuwait Oilfield discovery article

I would guess it is fair to assume it isn't spectacular, but I could be wrong.

I also doubt it is even giant class, since that is reasonable good news material in today's environment as well.

However, even if these assumptions are wrong, is it relevant if we already on the peak plateau?

We need a new giant every 6 days, or 60 per year to BREAK EVEN.

It is pretty easy to see this isn't happening, so it will take a tremendous amount of small fields to make a difference to the down slope.

Me: Planning for the worst, but always hoping for miracles.

When Hubbert did his original Lower 48 work, he found that a one-third increase in URR only delayed the peak by six years.

It takes decades to fully deplete a multi-billion barrel oil field like Prudhoe Bay (the largest oil field in North America and one of only about 14 fields that have produced one mbpd or more).

During Bush's first term, the world has fully consumed the equivalent of eight Prudhoe Bay Fields.

Kuwait's oilfield discovery is probably like KSA's...a long straw poked under the sand into Iraq.

LOL That was my very first thought too! and my second and third...

This announcement is a textbook case for almost all announcements coming from the middle east states. Another "huge" discovery..., but of course it is not mentioned, how "huge" this discovery is or at least how the estimates are. They leave the world in the dark. If this discovery were in Norway, GB, Mexico or even Venezuela, they would deliver data, since data is the only interesting issue.

It seems to me, that the main purpose of such announcements is to manipulate the markets. Because they do not deliver any new infos.

This tiny country named Kuwait is just suddenly discovering another Burgan. Great!

I don't believe them one single world.

It's certainly possible. As Weird Al once sang:

My new computer's got the clocks, it rocks
But it was obsolete before I opened the box
You say you've had your desktop for over a week?
Throw that junk away, man, it's an antique
Your laptop is a month old? Well that's great
If you could use a nice, heavy paperweight

Think of the billions of floppy disks and millions of disk drives that are no longer in use. Think of the billions of CDs/DVDs mostly gathering dust (obsolete CD-ROMs, CDs/DVDs holding obsolete versions of software, etc.). Think of the millions of hard disks that have been thrown away. Think of the millions of CRTs that have been trashed. Think of...

15:54 01May07 RTRS-Saudi Aramco oil output edges down 1.7 pct in 2006

RIYADH, May 1 (Reuters) - Saudi Arabia's oil production slipped 1.7 percent in 2006 while the proportion of exports to the Far East and the United States increased and gas production rose, figures published by state oil company Saudi Aramco showed.

Aramco said in an annual review posted on its Web site on Tuesday that it produced 3.252 billion barrels of crude oil last year and exported 2.54 billion barrels. The figures were slightly down from 2005, when total crude oil production was put at 3.308 billion barrels and exports at 2.62 billion barrels.

Average daily production was 8.9 million barrels, down from 9.1 million barrels per day in 2005.

The Far East accounted for 51.6 percent of crude oil exports, the United States for 19.2 percent and Europe for 6.6 percent. That compared with 49.7 percent for the Far East in 2005, 18.6 for the United States and 7.7 percent for Europe.

“Aggressive exploration programs were able to replace the 3.25 billion barrels of oil it (Aramco) produced in 2006, bringing its recoverable crude oil and condensate reserves to 259.9 billion barrels," an Aramco statement said.

Gas production rose to 3 trillion cubic feet, from 2.87 trillion cubic feet in 2005, and natural gas liquids production slipped to 399 million barrels from 400.4 million barrels.

Aramco put Saudi natural gas reserves at 248.5 trillion cubic feet.

Refined products output in 2006 rose to 595.66 million barrels from 591.95 million barrels. Aramco exported 183.96 million barrels of refined products in 2006 and 285.37 million barrels of natural gas liquids.

The kingdom, OPEC's largest producer, is boosting its crude oil production capacity and refining capacity in response to global demand. It aims to increase crude output capacity to 12.5 million bpd by 2009 and to 15 million bpd at a later date.

"In 2006, we achieved crude oil reserves replacement of 104 percent, adding 3.6 billion barrels. In addition, we doubled our target for new non-associated gas reserves, adding 10.4 trillion cubic feet," it said.

"With our greater emphasis on increasing production of natural gas to fuel the domestic economy, our major discoveries in 2006 were gas fields ... In the next 10 years we hope to add 50 trillion cubic feet to our current 248.5 of gas reserves."

((Reporting by Andrew Hammond, editing by Anthony Barker; Riyadh newsroom +966 1 4632603; Fax +966 1 462 7113; andrew.hammond@reuters.com))

“Aggressive exploration programs were able to replace the 3.25 billion barrels of oil it (Aramco) produced in 2006, bringing its recoverable crude oil and condensate reserves to 259.9 billion barrels," an Aramco statement said.

259.9 billion barrels of recoverable crude AND CONDENSATE reserves.

Unless I am mistaken, this is the first time Saudi has included condensates in this number... anyone???

Another year without movement on their recoverable reserves number...amazing. Truly!

16 MMBPD should be easy for them. Now that's a conspiracy...:-P

There just saving it for later...when everyone else runs out...

If they found their 3.25GB, I wonder who found the other 27.75 GB we need to break even from 2006.

Implied Saudi domestic crude oil consumption in 2006: 1.951 million bpd vs 2005 demand of 1.885 million bpd.

3.5% year on year increase

How come all these SA figures don't match with what the EIA state?

The EIA has average monthly prod. for 2005 at 9.55mbd falling to 9.152 for 2006; very different from the above.

Also by my calculations from the above data that is a 2% fall?

The war for your electric bill
Private-equity buyout funds are targeting electric power companies in deals that generate massive debt, stop the building of better plants and jack up rates. They take the profits and stick consumers with the cost.

The last time Wall Street applied its best minds to the electric power industry, they brought us Enron, brownouts and wholesale-price-gouging in California, not to mention higher electric bills.

Now, not even 10 years later, they're at it again: Private-equity buyout funds have set their sights on electric utilities. And the result will be? You guessed it, higher electric bills for you and me. As if inflation and the rising cost of oil and natural gas isn't pushing our bills up fast enough already.

I get my electricity from a rural electric cooperative. We actually get to vote on our board of directors and the direction of the utility.

It's a non-profit organization, and puts a lot of resources into energy conservation.

I'm surprised the privatization pirates haven't figured out how to take it over and loot out the profits.

If you enjoyed Chris Vernon's (TOD Europe) article on Senegal, you might like this journal about a womens' cooperative getting micro-finance via the Internet. Cool!

RE: The Year of Magical Eating: The 100-mile diet and other food stunts


Several thoughts (which are only applicable within an assumption that energy will inevitably become increasingly more expensive, but that this will not cause a TEOTWAWKI doomer scenario):

1) Transport is just one factor of energy input into food production. In many cases it is not by any means the largest energy input. It is difficult to sort these all out. It may not always be the case that local is always lower energy. For example, the ice cream produced locally probably has a much higher energy input than does cheese imported from hundreds or even thousands of miles away, because freezing ice cream and keeping it frozen takes a huge amount of energy.

2) Then there is the whole issue of driving around the countryside to find the local food. If you can't get what you need within the same trip that you would normally take to your local supermarket anyway, then the extra fuel expended driving is likely to more than offset any meager energy savings that are inherent in procuring local food.

3) Not every type of food can be grown at every location, and even fewer can be grown in a cost-effective manner. Oranges can be grown north of Florida if you grow them in greenhouses, but the extra cost of the greenhouse and the energy to heat it in the winter will end up more than offsetting the transport cost of the Florida oranges. This is why Florida has a competitive advantage when it comes to citrus fruit and many other frost-sensitive fruits and vegetables. A lot of oranges can be shipped north on boats and trains; the boats can be fueled with biodiesel and maritime shipment is a highly efficient method of transporting bulk goods, while freight trains can be electrified and are also highly efficient. Why give this all up? Our diets are better as a result of being able to obtain a wider variety of foods than what we can grow locally. This process also allows for the more efficient production of food and the maximization of productivity of each area. If Florida could only sell oranges to Floridians, then very few oranges would be grown, and a lot of land that might otherwise be productive would be either unused or devoted to less productive uses.

4) What happens when your local food catchment area suffers a drought, or a late spring or early fall frost, or a crop disease or insect outbreak? Having a wider range and greater diversity of food supply definitely helps prevent famines.

5) The best source of local food is the food grown in one's own garden. There is nothing stopping anyone from doing this to the extent that they are able. For those without land, there are (or should be) community garden allotments available. For most people, kitchen gardens should be a net economic plus, helping the household budget and offsetting some of the pain that higher energy prices will bring. To the extent that land presently growing grass or weeds is brought into household food production, to that extent we can help each household and each community develop a little bit of resiliancy to cope with sudden shocks in energy, transport, and food prices.

Hi Stefan,

I'm posting late, but wanted to say I appreciate your points here. I'd like to see you expand on these. Perhaps take one example, and work out the details. What would be the maximum range of shipping that makes sense? I'd say the ice cream example is a little extreme, because it's presumably on the high side of energy use. Can you find another example? This seems definitely worth pursuing.

re: "...while freight trains can be electrified and are also highly efficient. Why give this all up?"

I'd say - it's not a matter of "giving up". It's the reality that if things don't change, we'll have no choice. We just need to be reminded of the decline numbers.

The point is - okay - great. *Who* is going to get those freight trains electrified? *When*? *How?* With what funds? From where? And where's the distributed, renewable energy coming from to keep that grid going?

Time is short. I'm all for it. What's next?

Insurance a business-breaker

For most business owners, who are insured through a state pool, wind insurance rates are now about 2½ times what they paid before Katrina. With commercial rates already much higher than residential rates for similar structures (because there are four times as many homes insured by the pool as businesses, thus spreading the risk), the recovery of business districts all along the coast has been thrown into doubt.

Thanks Leanan for all your work digging up the articles!

Has anyone noticed that there hasn't been any really interesting news in this area (oil, energy) for a couple weeks?

(explains why copyright discussions are major threads lately, and not including contributor keyposts)

Quiet before the storm?

Some milestones:

45 days until Hurricane season officially starts.

120 days to the peak of Hurricane season(sept).

19-20 days forward of gasoline supply on hand (depending on this weeks numbers)

24 days until start of DRIVING SEASON.

-7 days since KSA should have increased imports to meet driving season demands.

I have been interested by the recent spate of stories citing energy or electricity problems in "developing countries": Costa Rica, Colombia, Ghana, Uganda and Nigeria spring to mind.

None of the stories that I have read have equated the problem to the price of oil. Lack of maintenance etc are the usual culprits.

To me, the common thread in all these stories is one of growing unaffordability of energy and/or the cost to maintain the delivery system.

In other words, we are seeing demand destruction slowly creeping across the broad base of the impoverished world, and, no doubt, into the more impoverished sections of wealthier societies. It is not commented on as such, but I am sure it is happening. And yet competition for supply is still strong enough to maintain global demand growth.

In Costa Rica there are currently rolling blackouts due to lack of hydropower. It's been a relatively dry year. Here in Panama we're doing ok, but have cut off sending hydropower to Costa Rica due apparently to lack of payment, but there could be supply issues here as well if the rains don't come. Lots of increasing demand. Gasoline at $3.50, a dollar more in Costa Rica.

I agree completely and have been watching for these kind of articles for a couple months. While only anecdotal so far, it looks like a "stealth" demand destruction has been creeping across Africa and other impoverished regions, which is what you would expect if demand has already outstripped supply and peak has already arrived.

Hurricane season starts June 1.

Yes, Yes...my mistake...I was confusing MAY 15 with June 15, as the date when NOAA starts issuing Tropical Cyclone Danger Area maps. The season starts June 1st.

Oops, that makes the milestone closer...!

Yesterday's Bee Experience

As I was walking through my apartment complex after work yesterday, I noticed a bug or something flopping around on the ground. Usually I wouldnt have stopped, but this time I had to see what it was. It was a bee, and it looked like it was having a seizure! Well I couldnt risk being caught staring at the ground by a neighbor so I continued on.

Later, around 7ish, I took a walk to the grocery store just around the block. When I just got outside the complex' Orwellian "security" gate, I noticed more bees spazzing out on the pavement. There must have been about 20 or so bees on the ground, some dead and some just freakin out. There were a few live ones flying around the flowers, but that still wasnt very reassuring.

Best Hopes for cure to bee epidemic?? =/

There's been lots of news stories about bees suddenly disappearing from their hives, not returning. I suspect it might have something to do with GMO corn. They're using so much more of it due to the push to make more ethanol from it. However, some university was pushing the idea that cellphone signals were interfering with their ability to navigate. I don't buy that as easily as the proliferation of GMO corn, however.

I was staring at one honey bee going bananas in a dandy lion flower in my yard on Sunday. My face was 5 inches from her and the flower, but she didn't pay me any mind, just going to town while covered in pollen.

I have seen three bees so far this year in Bellingham (Washington), a yellow jacket and a pair of honey bees. I spend a fair amount of time in my garden and outside in general, and make a point to look for them after seeing all these stories about colony collapse. I have three pear trees, an apple tree, and a handful of plum trees that are blossoming and I would expect to see more than three bees thus far. I'm keeping my eye out, although I must say things seem peculiar.

I have seen one large bumblebee roaming the flowers at ACE Hardware store and then I say a honeybee on a dandelion at the park right before my 4 yr. old stepped on him...ughhh.

I was looking at the bee and he came running up to see what I was looking at. Honey bees usually are quick enough to escape approaching feet, but this guy was not (impaired?).

I went on a long walk at Cook Park, in Tigard, OR, on Saturday afternoon. The sun shone from a partly cloudy sky, and the temperature had warmed into the mid-sixties. Apple trees were abloom along some of the trails. Though I kept a careful eye out, I only saw one honeybee on the whole trip. I recall days in past years where the drone from the buzzing honeybees would vibrate loudly in my ears as I approached fruit trees, there were so many of the little pollinators. I believe, however, that this happened on warmer days (mid-seventies). In any event, I'll keep looking for bees on my outdoor treks.



I too went looking. I have found very few even though my pear tree is in full bloom. I found a few on a 2" tall blade of grass and they were acting really wierd. Our bees are wild as we live 10 miles from any comercial hives. I do notice a native ground dwelling bee that seems to be doing OK. they make small mounds like a worm and seem to prefer exposed subsoil. Haven't a clue what they are, or what they do, but they do sting!

They could be (pun!) a species of mining bee.

Used to see them in California a lot... They can catch you buy surprise on a cross-country walk!



Here in Pittsburgh, PA, USA, I noticed my garden was full of bees a few days ago, going about their business. Over the
weekend in a state park about 60 miles to the north I saw only two bumblebees flying about and a third who seemed to be acting unusually on the ground (and this in the early afternoon when it's primetime for bees to be out working).

i live right in the middle of the city, probably 20 miles from the nearest farms that might be planted with GMO anything..

I have been watching whatever scrap of information I can get
about this bee situation. It is very distressing. My family
has kept bees for ages, and I have great hopes of
moving somewhere remote and resuming the beekeeping tradition in the next year or two.

I don't buy the cellphone argument one bit. If it interfered
with bees, then it would have been interfering with them
for decades now. Likewise, if there were some chemical
pollutant which was causing this trouble, it would have
developed more unevenly around the world as concentrations
and local conditions accumulated critical levels of such
a pollutant. The bee situation began rather quickly and
more or less simultaneously all over the place.

The rapidity with which certains strains of
genetically modified crops have been rolled out through
so much of the world does seem to correlate the abrupt change of conditions which could explain the suddenness with which the bee dieoff has emerged and progressed.
As soon as the season started this year, it all went
haywire. suspicious. It has spread faster than an epidemic
seems to have spread, and some reports that affected colonies also seem to be afflicted with a whole array of
diseases and infections which typically bees can keep at
bay, and affected hives reportedly being shunned by typical
predators and scavengers like moths and roaches also
point to some other factor than an epidemic, and again the
roll-out of some new GMO 'product' could fit the profile.

I don't buy the cell phone theory either, though I still don't see their merit. Guess I'd have to go back to high school, where all the kids seem to have one.

One of the most frightening aspects of CCD is the mention of hive and honey avoidance by ants and other scavengers. Hard to ty that to a GM rationale, but in absence of other ideas, it seems the best hypothesis.

Following is a link that hints toward GM involvement from a German study. It is the link I was thinking of in a posting the other day.


Hi Rudolph,

In case you missed it (though behind a pay wall when I find the link - sorry!) - a pretty good overview http://select.nytimes.com/gst/abstract.html?res=FB0910F73C5A0C778EDDAD08...

Vancouver has for weeks now been awash in flowers; apple blossoms, plum blossoms and cherry blossoms so thick that the roads are literally pink. Cars drive around covered in petals as if it were snow. And guess what...

Not one bee. Not one bee in the flowers, the gardens or the trees.

And although everyone has postulated about the root cause of CCD lets do a quick recap of what we've observed thus far:

1) the bees are disappearing - not dying
2) the bees are disappearing from North America, South America, Russia, Europe, India & Asia
3) the bees are disappearing from areas without cel phone towers and areas with cel phone towers
4) the bees are disappearing from areas where they are fed antiboitics are areas where they are not
5) the bees are disappearing from areas where GMO crops are planted and areas where they are not
6) the bees are disappearing from areas where fungus is present in the hive and from areas where it's not
7) the bees are disappearing from areas that are sprayed with pesticides and areas that are not

CCD is occuring on a massive scale in both native and non-native habitats simultaneously for the first time in recorded history and one would be hard-pressed to learn about it on the 6 o'clock news.

Then again... does one really want too?


1) the bees are disappearing - not dying

That, for openers, is simply not true.
The rest of your argument has a lot of maybe's.

Best so far I've seen, and this time I'll post the whole looong quote, from a commenter at Sharon Astyk's blog:

Ellen Anderson said...

Mystery Disease? Sounds a lot like poison to me. The real mystery is why we are sitting by like timid dummies while the big corporations spin this one. Cell phones? Really?

I am a beekeeper in Central Massachusetts who read about Colony Collapse in February. Something in one of the reports reminded me of a description of how termites are said to be killed by a new class of pesticides known as neonicitinoids. I went to my local farmers' coop, picked up labels from the various insecticide bottles and Googled the ingredients with 'honeybees,' 'sublethal' and 'organic.' A product called 'Merit' containing the neuro-toxin 'Imidacloprid' came up as a soil treatment for fruit trees. Other products with other cute names were being advertised for use on turf to kill grubs (also earthworms.) The labels promise that all sorts of insects, including adult japanese beetles will be controlled for 12 months (read systemic.) Visit your local Walmart and garden center and you will find it on all the shelves. They sell more of it every year according to the Bayer Corporation. You remember Bayer, right? They gave us aspirin and other less pleasant products in WW I and WW II. More recently, BayerCropScience has given us the gift of genetically modified rice. You may have read about it.

'Merit' 'Gaucho' 'BayerAdvanced' 'Admire,' 'Gaucho,' 'Genesis,' 'Platinum,' 'Provado,' 'Leverage,' 'Actara' are catchy little trade names for Imidacloprid, a systemic insecticide that was banned in France after beekeepers staged an angry protest in Paris. Bayer CropScience paid many millions to the french beekeepers and voluntarily withdrew the product without admitting that it was the culprit. Vive La France! They take their food seriously. Shame on us. Shame on the EPA. Shame on the media for not even mentioning the history of the peoples fight against Imidacloprid in France. The more stories I hear about the mystery disease the sillier they get. Soon the media will begin to snicker at all of the alarmists who worry about GMO's and cell towers. They will sigh, continue to wonder and finally forget about it. Already some are beginning to talk about how we can survive without bees as though it were just another problem like surviving without oil.

Imidacloprid is the most likely culprit in CCD, even thought there may be other contributing factors. This is the same class of stuff some of us put on our dogs and cats to kill fleas and ticks (see Fipronil and Frontline.) It is much less toxic to mammals than to invertebrates. ( I confess that the ticks at my place have tempted me to put it on my own neck.) Yesterday, I overheard a salesperson in the coop suggest to a customer that he put some on his chickens. What a wonderful idea. We can have it for breakfast in our locally produced eggs. This morning The Weather Channel carried a Bayer advertisement for Merit calling out to those of us who are "sick and tired of all those bugs." If Imidacloprid were being discussed as a cause for CCD, you can be sure that the Weather Channel would be a little more concerned about those ads. That is why it is hardly ever mentioned by name. Instead, the generic term 'pesticide' is used in news discussions of CCD.

In fairness, defenders of Imidacloprid say is that it is less toxic to humans than the Lindane that it replaces. Also, this is the only chemical known to kill the wooly adelgid that attacks canadian hemlocks. But many home gardeners are aware of Lindane's danger using it carefully if at all. And, even it there is some role for Imidacloprid, there is no excuse for mixing a persistent neurotoxin into our food supply and placing it in the hands of unsuspecting or careless homeowners.

The Merit label I saw carried no warnings about bees even though there is no question that a sufficiently large dose of Immidacloprid is known to kill honeybees. This fact is not in any dispute. The question really is whether there are low, sub-lethal doses that do kill the bees. Bayer says there is no proof of this. They cannot find any traces of the stuff in the dead bees. (Actually, they cannot even find the bees.) Consider, however, the following. The graphic on the Merit label illustrates how the product travels up from the roots into the branches. Bayer claims (and studies confirm) that it is present in blossoms and pollen and that it persists in the soil for at least one year. So the bees do get some of it. If it will kill a really tough Japanese Beetle for 12 months is it really sensible to think that it wouldn't kill a honeybee, known to be sensitive to the drug? Consider also Bayer's own account of how termites are killed by Imidacloprid: the termite's immune system is compromised by the neurotoxin so that it becomes susceptible to the viruses, bacteria and fungi that are normally present and controlled. In other words, their immune systems collapse. If, by chance, the termite is not killed outright, when it flies away from its nest, Bayer's ads say that it will not be able to find its way back. Sound familiar? Sound like colony collapse disorder?

I guess that I am going to try to post this wherever I find people talking about cell phones killing bees. Incidentally, our hives, mainly managed organically and close to protected open space in Massachusetts, were doing just fine in February, March and up until the great rains. Hopefully all is still well. We have a great variety of native bees and dragon flies and we do not place hives in any locations where any pesticides are used. That includes BT. Yes, we have to worry about mites. We are going to have to hope that, as time passes, the honeybees will begin to develop some natural resistance. I hope that the state and federal governments will help support organic beekeepers as we go through this. The best way to start is to tell the big corporations to act like good citizens. They want rights of citizens, they should have the obligations of citizens. So far, it doesn't look good. Again, I say, Vive La France!

17 April, 2007

I saw your post on this before. It has me thinking... I agree that the explanation seems to make the most sense at this time.



Another likely suspect, but it comes with problems too.
Neonicotinoids are being pursued as a suspect by the CCD working group:

"Of particular concern are pesticides being widely used to control insect pests in agriculture, urban environments, and animal systems. Among these are the
neonicotinoids, a class of pesticides that have been extensively adopted for pest management. This class of pesticides is recognized as having extremely low toxicity in humans and other vertebrates and as highly effective in controlling insect pests; however, these chemicals are known to be highly toxic to honey bees and other pollinators. Some research has suggested that these systemic pesticides can translocate or move through plants to become localized in pollen and nectar at concentrations that may affect bees. Research is warranted to address the effects on the bees and other pollinators of these compounds at the concentrations found in pollen and honey made from nectar collected by the bees. It is essential to determine whether these pesticides play a role as a causal factor in the CCD symptoms."


But why are they not affecting other insect pollinators, or why do we note CCD in isolated rural enviroments, having a patchy distribution in suburban and now urban areas. Finally, with a toxicity problem, one would expect finding mortality in the hive.

Hopefully, the research will come this summer to address these questions, but the swiftness and completeness of the disappearance is scary.

Next job for the DNA wranglers: GM Imidacloprid resistant bees! Think of the royalties!

The problem will solve itself.
But not in a nice way.

HeIsSoFly, thanks for the Ellen Anderson quote. For the past few years we (Ventura County citrus growers) have been encouraged to use Imidacloprid to suppress the glassywing sharpshooter, a vector for Pierce's Disease in grapes. The cost is covered 100% by the guvmint. So far I have refused to get with the program. Last year the citrus leaf miner arrived and became another reason to use Imidacloprid. All new growth gets curled up, but thanks to the freeze killing most of the leaf miners the spring flush with its orange blossoms was unaffected. Only now at the end of the bloom are leaf miners appearing. Its exceedingly strange to see acres of orange blossoms with very few bees.

Hi land,

Good grief. 100% covered (!?!) Thanks for going your own way.

I'm wondering if it's possible to encourage (somehow) the bees that are unharmed - to...uh (?) reproduce? And fill in? (Also, wonder how long the contamination lasts...assuming that's the problem.)

The way you encourage them is Permaculture (polyculture). Chemical-heavy monofarming is fucked, Permaculture is our only slim chance at a decent future:

Notice the Peak Oil headline with a photo of Holmgren with Richard Heinberg on the front page. Truly natural farming, which means concsciously creating diverse microclimates/ecosystems that thrive with as little input from people as necessary, is the future. The green revolution was always going to be a short-term party, because man cannot improve upon nature, despite his huge ego. Working WITH nature is the answer, and if you've seen some of the permaculture gardens, you can understand just how productive they can be - without fossil fuel inputs (though of course it takes serious re-education).
In fact I agree with Holmgren that the claimed necessity of oil for agriculture is the one of the biggest myths of all time, right up there with the one claiming animal products are "healthy" LOL :)

As another superb example is Fukuoka from Japan, who through epiphany and hard work, learned to do truly natural farming - and getting yields in the top 10% of the country, while having hugely reduced costs because he uses near zero fossil fuel inputs, but instead works with nature (not sure if he's still alive but I think he lived to 100 at least - cuz he ate mostly whole plant foods of course!)


Hi vegan,

Thanks for the links. I've looked into this before, and will pursue further.

Some qs:

1) Have you personally had any experience with or done any permaculture "farming"? How did it go?

2) Do you have any ideas on how to convert large areas (say, 200 acres and above) of land that's been farmed commercially (conventional methods) for more than 50 years - to organic?

2a) Do you see organic farming as different than permaculture? If so, what are the differences? Do you see any disadvantages to organic?

3) What I read (and I haven't read it all) - the Fukuoaka family no longer farms in this way, nor do they answer questions. Do you have different info? Are people successfully using his methods currently? (Who and where?)

Maybe I have been watching too much "House", th medical TV show, but when one is treating a patient, doesn't one begin treating the patient based on his or her symptoms without necessarily waiting for definitive proof of the underlying cause. If the patient is dying, one does not wait for a jury reviewed medical paper before one takes action.

Well, the bees are missing in action and/or dying, which may very well cause the destruction of the majority of our food crops. I don't see how we can wait until we have definitive proof of the cause of these deaths. Is each pet food company waiting for definitive proof that their specific products are contaminated by melamine. No, simply because cats and dogs are dying now.

Millions of bees have died and are dying and our government is seating around with its thumb up its bum because it doesn't want to offend the big players -- the pesticide companies and the big GMO companies.

This is going to be catastrophic and our society has become so utterly corrupt that we are going to protect big business while we sacrifice our food sources and the American people.

I think this bee problem makes peak oil seem like a walk in the park.

I agree that Imidacloprid could be the cause but three things don't add up.

- Is Imidacloprid used in every country experiencing CCD?
- Why would Imidacloprid not have caused CCD last year or the year before?
- How can Imidacloprid cause a global, simultaneous collapse?

And with respect to the dying/disappearing assertion, even Ellen Aderson states in your post, "(Actually, they cannot even find the bees.)"

Ergo until someone RFIDs a CCD colony pre-collapse, I must adhere with what is 'observed'.

Or like I asked above--why no mortality in the hive. To have all the millions of bees be subject to a tox problem that is so rapid all perish out of the hives doesn't add up.

And yet, the hive and honey appears tainted to other organisms-suggests that they had the problem prior to leaving the hive.


Cool link!

Your list started me thinking. How might increased levels of CO2 in the atmosphere alter bee behavior? So I did some searching.

The article Changes in the Behaviour of Honey-Bees Following Their Recovery from Anaesthesia makes this claim:

Carbon dioxide anaesthesia did not impair the memory of treated bees, but it did induce a permanent change in their behaviour. Their pollen-collecting tendencies were either eliminated or suffered very marked reduction. Experiments with foraging bees of known age indicated that the carbon dioxide treatments had no direct effect on longevity. Treatment of recently emerged bees with carbon dioxide eliminated all or most of their brood-rearing and wax-secreting activities and caused them to forage at an early age. Foraging life is more hazardous than life within the hive, and therefore the expectation of life of these carbon-dioxide treated bees was less than that of the controls.

Which, interestingly, fits with the effects observed with CCD.

However, this article, Atmospheric carbon dioxide regulation in honey-bee (Apis mellifera) colonies (paywall) points out that honeybees do a lot of CO2 regulation within the hive (lots of respiration), and it appears that CO2 levels can get a lot higher than 380 ppm inside the hive. This paper, Immediate and latent effects of carbon dioxides on insects also notes this fact.

So maybe CO2 levels aren't the culprit. But who knows... Maybe the atmosphere is reaching critical levels of CO2 to begin influencing insect behavior outside of hive situations...



Hello Graywulffe,

I find this CCD especially worrisome; I really hope the researchers can find a solution soon, otherwise the food price spiral will be breath-taking. If CO2 ppm is found to be the true cause, the resulting FF-demand destruction among humans from high death rates will hopefully keep CO2 levels at the bare minimum to keep the bumblebee from going extinct.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Hi Wolf,

Thanks for this additional info. If the folks studying don't have it, I hope they soon will. It could be one of many factors.

An interesting possibility - thanks.

I wonder if anyone has checked out what has happened developmentally to bee eggs/larvae overwinter. How about the Earth's magnetism, change of seasonal patterns, UV radiation? I know bee's can see UV wavelengths. That would be more ubiquitous worldwide than some of the other reasons put out there.

Contrary to what just about everyone thinks, we won't have natural gas shortages, we'll have surpluses that render additional supply redundant.

But from Qatar? Are you sure? Exxon scraps a $15 billion terminal, for fear of cost overruns, and we'll still get the gas? Where? Putin?

LNG to stymie pipelines, U.S. warns

"If you accept that the North American gas market is changing, then Alaska and Mackenzie's competition isn't with declining U.S. offshore Gulf Coast production, it's with very lowcost gas production in Qatar," Mr. Kelliher said..

CALGARY - The head of the top energy regulator in the United States says the arrival of unprecedented volumes of liquefied natural gas (LNG) starting next year could push back Arctic gas development and throw another wrench into the Alaska and Mackenzie pipeline projects.

Joseph Kelliher, chairman of the Federal Energy Regulatory Commission (FERC), said yesterday an expansion to one of the four existing U.S. LNG terminals, plus five new facilities due to be operating in 2008, mean the super-cooled fuel imported by tanker will contribute a "very large share" of total U.S. gas supply for the first time ever.

FERC expects a sixth terminal and another expansion to be completed in 2009. The regulator has also approved nine new terminals and three more expansions beyond that.

LNG is obviously winning the race with Arctic gas to feed the continent's growing demand for the heating a power-generation fuel, Mr. Kelliher said in an interview from Kelowna, B.C., where he is taking part a conference hosted by the Canadian Association of Members of Public Utility Tribunals.

Both the Alaskan and Mackenzie natural-gas projects, with the latter's economics increasingly being questioned since its price tag recently ballooned from $7.5- billion to $16.2.-billion, could wind up being pushed farther off into the future because of LNG's emergence.

That's the million dollar question...who is exporting these volumes?

IIRC, they turn these ships around every ~4 days(unloading and reserve), so you need quite the fleet floating as well...has it been built? That is somewhere around 16 LNG tankers per terminal if it coming from the Middle east or similar.

Even if it is half that, it seems there will be a massive number of LNG ships on the sea at any time.

But back to the original question, who is going to export the LNG? There are a lot of customers...

Second day in a row a mysterious force comes in to the market at 2:00 and absolutely hammers the oil market. The refiners and even the integrateds have to be loving this. Buying oil at $64 or less and selling gas at $2.20/gallon. They are printing money.

I have noticed the "invisisble hand" too!

I don't understand it. Chavez takes over the oil fields and oil drops. Ford post a 23% percent drop yet the stock price doesn't go down. The housing situation is a mess, yet the DOW is hitting all time highs. Can someone explain this?

The market reacts to unanticipated information. I imagine investors expected the drop for months and that was factored into the stock price. If it had dropped less the stock would have rose even.

Basically investors still think its a good time to bet.

"chay" posted a cute you-tube video called "Are Humans Smarter than Yeast?" to a thread which is mostly past at this point. A link is here:


He is asking for comments.

Can someone explain this?

No. But I've read of some gov't group called the PPT, the Plunge Protection Team, or something like that. What do they do? Also, there's been talk here on TOD of a pipeline from between SA and Iraq, and its possible use in "delaying" SA peak. The MSM give little hint of the coming turmoil. What other games are going on? We don't know. But the one thing we know for sure: really big games ARE being played.

That is just too scary. Manipulation on that scale. Not that we don't have individuals and institutions with that kind of wealth, but the why presents itself. Are they manufacturing the mania in the markets to give them the oportunity to divest in a big way, and leaving the small stupid investors holding the bag when the house of cards collapses?

Here's a little mathematical quibble that appears in a lot of stats cited here. (This is not a complaint about the TOD commentators who quote these stats, but rather the MSM who writes them up in the first place.) Here is an example from today:

April auto sales were so slow that even Toyota reported a decrease from the same month last year. Ford's U.S. sales also fell, while Chrysler edged up.

Most analysts were predicting that U.S. sales overall will be down due largely to the slumping housing market, rising consumer debt and no pent-up demand for vehicles.

Gasoline prices also are at or near $3 per gallon, and many consumers were expected to delay auto purchases until they find out what will happen to gas prices during the upcoming summer driving season.

Toyota Motor Corp., whose brands include Toyota, Lexus and Scion, said Tuesday its U.S. sales dropped 4.4 percent to 210,457 last month from 219,965 in April 2006.

Whenever there is a "percentage", there must be a numerator and a denominator. The problem is that the denominator is often obscured. In this example it is actually pretty clear, it is the sales in April 2006. But in many other reports it is not so clear. And when they say "measure X dropped in month Y, the Nth drop in as many months", and they really mean "X was lower last month than in the month a year earlier, and we saw the same pattern in the last N months" I think the language is misleading. E.g., imagine the following numbers, for consecutive months Jan. 2005 -- June 2006, with a big but one-time drop in Dec. 2005:

2005: 100, 101, 102, 103, 104, 105, ..., 110, 90
2006: 91, 92, 93, 94, 95, 96

- here we have a month-to-month increase in each and every month in 2006, but one can still say that "in June 2006 we saw a drop in X, relative to the same month in 2005, and this was the 6th consecutive such drop". Harumph! (I've seen a lot of such in the housing bubble reports.)

While I'm on this soapbox, I want to clarify (?) something that WT often repeats: that the year-on-year drop in oil output, in a region that is just past peak, is lower than the month-to-month annual rate of decline. I think what he means is that after the peak the shape of the curve is such that the slope starts out flat ("plateau"), then starts a shallow decline, then gets gradually steeper and steeper. (What mathematicians call a "concave" curve, and looks to my eyes as "convex".) This curviness means that any longer-term average rate of decline is less steep than the most recent bit of the curve.

When one talks about a whole year, say, that's the sum of 12 monthly data points, say, and is thus the area under that curve for that period, or, equivalently, 12 times the average height of the curve (of monthly data points) over that period. If you compare such a year with the following year (further out the decline curve), the drop is not as large as the drop between the ends of the second year, because the first year average is only slightly higher than the end of the first year due to the shallower slope within the first year.

Even more so if the baseline period compared with the recent period is a period that includes some length of time preceding the peak, i.e., mixes in some data points that are lower than the peak because they were before the peak, then the baseline level for measuring the YOY decline is lower, and thus the decline percentage is smaller.

(this would be easier to explain graphically but that's too hard for me top post...)

Next year's month of February will have 3.6% more days in it. I wonder if that will be taken into account or we'll have a headline that notes a "gain" in month sales but doesn't account for February 29th.

Generally speaking, many of these single-month stats are meaningless because the car/truck market is so dynamic. For example, sales of a soon-to-be-discontinued model will likely be dismal and affect the whole month for that company if it is one of their major products. You really have to know the market and the situation to read any useful information from the statistics.


A new Amtrak funding bill is finally making its long slow journey through congress. Lautenberg is pushing for $11.4 billion total with a lot of rail improvements as part of the package. With the current makeup of the congress it is probably going to make it through. Now we just need to see if they can squeeze it by Bush.

This is a lot more than his $800 million subsidy and $100 million for rail improvements...

It'll help as much as the federal aid to NOLA. Any governor or legislature in any state wants to get real, ORDER THE GUARD HOME. Demote any officers that refuse - that authority still remains - and send them to run convoys for Halliburton.

But they don't want to get real. I do like Monbiot's article in the drumbeat, The Rich World's Policy is Clear; Millions Will Die. He's talking about greenhouse gases, but that's really the same as energy use. I'll be using that in some testimony at State House, tomorrow. Maybe it's time to start indicting legislators for crimes against humanity.

cfm in Gray, ME

Flush with cash as a result of soaring energy prices, Prime Minister Vladimir Putin behaves like a man who is utterly unconstrained by "world opinion" (however defined), or the possibility of incurring Washington's wrath.

What's the difference between "world opinion" and "the possibility of incurring Washington's wrath"?

In the US: US opinion IS the world opinion and anyone who says anything else is by definition against world opinion.

Everywhere else: World opinion is what the US ignores.

You will note that these are not mutually exclusive.

This is way, way OT...but interesting to me nonetheless.

The last few big storms that have come barreling across the midsection of the US have resembled a massively circulating storm system (like a hurricane on land).

Check out accuweather and click on animate to see the rotation. If you zoom into the four state region of Kansas, Missouri, Oklahoma, Arkansas you can see it quite clear. I have noticed this pattern a lot lately and don't recall it as much in the past. Usually, the storms come through this time of year in more of a linear train sequence.


What it looks like to me is that, this year, the extratropical cyclones have been following a track further south on a more frequent basis than recent years. So, instead of getting whipped by a long (~linear) trailing cold-frontal system from a midlatitude (= extratropical) cyclone moving over the northern tier, places south are getting all the wonderful dynamics associated with being in close proximity to the low pressure center.

Near the center, the cyclonic airflow is more evident, there's a greater chance of getting the brunt of more than one frontal system (leading warm front, trailing cold front, bent-back occlusion), often pressure gradients tend to be the steepest, and convective potential the highest, among other factors. All this makes for some very interesting weather!



For those with a little time on their hands:

almost free garage heat - just drink a lot of soda

Have fun!

I suppose we'll see an increasing amount of home-made heating remedies as the cost of energy continues to climb, and people get increasingly poorer.



Riffle through John Seymours Self Sufficency (new edition), and there's a snake of bottles with the bottoms cut off over a garden hose, for quick and dirty solar heating. I always think the clever bit is getting the flow right to use heat convection to pump the water through the system.

Aussie solar developments:


I have just read several articles about bottled water all of the linked from the "100 mile food" article of above.

What surprises me in that article is that the couple mentioned drive all over the place to get their foods, really wasting a whole lot more gas money than just buying from the market down the street.

We aren't going to be able to survive very long if we ALL had to live off the produce from a 100 mile radius of our houses. Though some would be better off than others. Arizona and Nevada are two states that come to mind as places I would not want to be if I had to live solely off the land. I know a lot about the plants in my area that I can live off of, it is that I know they won't feed more than 10 people let alone the 185,000 that live within 20 miles of here.

It is not that it will all go crashing down in a single week, but we should at least understand better where our foods do come from. Chilean sea bass, and grapes and pears and any number of other things that come from halfway around the world maybe can be pruned out of your diet and you can invest in the farming of local produce with local growers.

Little Rock has a Farmers co-op selling local produce for a set fee for 3 months. Meat, cheese, canned goods, and fresh veggies and fruits are all in the mix. I don't think I could feed a family off the baskets, but it is a start in the right direction.

Hey, you're in the Little Rock area? I'm going to shoot you an email. :)

"chay" posted a cute you-tube video called "Are Humans Smarter than Yeast?" to a thread which is mostly past at this point. A link is here:


He is asking for comments.

(Sorry, I posted this up above on the wrong thread).

Thanks, Gail.

I posted a video clip about growth on May 1st. By this afternoon it had received more than 550 views. At this invitation by Gail immediately above, I followed her link back and realized that already I had received some good feedback, including, in particular, an observation by Wolf that I had introduced an error.

That now has been corrected, but I couldn't overwrite the original video clip on YouTube. So here is a new link, "Are Humans Smarter Than Yeast?". As Gail observed, I welcome your helpful feedback.

Dan Chay

Authentic learning ends where faith begins.

We don't often look at demand as much as we should but there is some EIA data out there. I looked at demand in the years 2003 and 2006 (which covers the most recent oil price surge). In terms of % changes (cp 2006 with 2003) in demand (mb/d)

US demand was 3% higher
OECD Europe demand was effectively unchanged
Total OECD demand was 1% higher

Chinese demand was 24% up
Demand in other Asians states was 8% up
Demand in other states (non Asian, non OECD) was up 12%

Total global demand was up 6%

Possible interpretations?

a) The OECD countries have been able to grow at around 3% per annum (cumulative 12%) between 2003-2006 using very little extra oil. If your looking at where efficiency increases (or in a way demand destruction, if you accept more growth for the same fuel is a form of demand destruction) is happening it seems to be principally in OECD Europe.

b) China and the other Asian countries have been growing much faster but have used much more oil.

c) The 'others', which by extension must include the poorest (non-Asian) countries in the world have also perhaps surprisingly increased demand, by 12%. The comment is often made on TOD that demand destruction must be happening in the poorest countries - if it is its being disguised in these figures (I hasten to add thats not to say its not happening in places like Sierra Leone, Costa Rica etc; but if it is these figures suggest that countries which rank a wee bit above them in the global pecking order (places such as Uruguay, Bolivia etc must be increasing their demand to cover it).

These are just a few possibilities that might be worthy of further interpretation; optimists might want to fix on how OECD countries have seemingly grown for 4 years without demanding anymore oil, but I couldn't possibly comment........

“c) The 'others', which by extension must include the poorest (non-Asian) countries in the world have also perhaps surprisingly increased demand, by 12%." Posted by andyh

The others would also include the OPEC states themselves, which probably account for the lion’s share of this increase.

Antoinetta III

Andy: Good analysis. One point: with a GDP per capita of $12000, Costa Rica isn't Sierra Leone ($900) or even India ($3700).

Politico.com is now accepting questions which will be asked to the republican candidates during a 30 second speed round in the 5/3 GOP presidential candidates debate.

There are currently 29 questions in the energy category and a few of them address PO. If you have a minute, please add a question about PO here - http://www.politico.com/debate/askquestion.html.

Remember that this is a 30 second speed round. This question will not make the final cut since it cannot be answered in 30 seconds...

To all the candidates. Do you believe in the theory of "Peak Oil"? Has world oil production peaked? When will it peak? What will the effects of peak oil have on the United States in 20 years? What is your plan on energy?


Also hit the button to vote for PO questions. Spread the word.

Has everyone in the markets taken leave of their senses? Does no one remember that making a burger at McDonalds is now considered a Manufacturing job for statistical purposes in the US? Does no one remember the oil supply/demand problem or that Gasoline stocks have been drawn down fo 10 straight weeks? What about the housing market and sub-prime loans? What about China divorcing itself from the US Dollar? When Market movements are so divorced from reality and you can feel the Mania in the air, you know a BIG correction is imminent. Also, what about Venezuela? It's a Full Moon. Am I going to wake up in the morning to find it was used to conduct an invasion? God, even the Tech bubble wasn't this manic. Are we looking at 1929... or worse?


Everyone is acting like there is no tomorrow... spending, investing, consuming, eating...not definitely not saving or conserving.

The biggest bubble of all is derivatives everything else is chump change. 4 Quadrillion dollars...it is totally, utterly absurd.

Ali Al Naimi, Saudi Arabian Minister of Petroleum and Mineral Resources, announces a new $7 billion megaproject

As Aramco is short on new oil megaprojects, this megaproject is a world scale aluminium project. Light weight aluminium can only go up in price as energy costs increase. The required 1400 megawatt power plant will probably use inexpensive Saudi natural gas.



As everyone is waiting for tomorrow's (er, today's) EIA report, and whether gasoline stocks will be up or down, I've thought about the question of how much the US is willing to spend for gasoline and are we seeing demand destruction yet. Indeed, walking around the neighborhood tonight I realized I didn't know how much we spend week to week on gasoline, or where it would end...

Looking at the EIA data for gasoline prices and consumption, and making lots of generalizations (e.g., price = average of all grades and formulations, that the Monday gas price can be used for the entire week of consumption, etc.), I estimated the weekly expenditures on gasoline (not diesel, jet fuel, etc.) to be:

{ week ending} {$$$ x 10^9} { % increase over 2006}
03/02  6.56 7.21%
03/09 6.87 8.11%
03/16  7.08 9.84%
03/23  7.13 5.17%
03/30  7.41 9.34%
04/06  7.67 6.61%
04/13  7.74 6.12%
04/20  7.87 5.06%

[sorry, no time to deal with table tags...]

So, Americans are nearing $8Billion/week expenditure on gasoline, and we are spending more this year than last (note that the variable date of Easter plays a bit of havoc with year to year measurements for end of March and early April, I suspect.)

What stands out to me is as the total approaches $8 billion the week to week (and year to year) changes get progressively smaller. Now, for the week ending 4/27, the gas price measurement on 4/23 was a tad bit less than that measured on 4/16, but after the EIA report last Wed there was some serious price movement... Looking above it seems to me the nation's 115,000 or so gasoline stations will have a harder and harder time coaxing significantly more $$$ out of the populace for this time of year.

So, I'm expecting some demand to have went down.

Hi InJ,

Good points. To see it in dollar amounts like this is astonishing.