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DrumBeat: May 23, 2007
Posted by Robert Rapier on May 23, 2007 - 7:00am
Oil rises after US report confirms fears of tight gasoline supply
Oil rose after the US reported gasoline inventories remained low just days before the peak demand summer driving season kicks off. The US Energy Information Administration said gasoline stocks rose 1.5 mln barrels in the week to May 18 but remain 'well below the lower end of the average range' in its weekly snapshot of fuel inventories.
Simon Wardell, Global Insight analyst, said gasoline stocks should be rising more sharply in May and June, but refinery outages have stopped inventories from building. Some market players were 'hoping for a bigger build (in gasoline),' he said, adding today's rise was not enough to ease concerns of tight gasoline supply ahead of the peak demand period.
EIA Inventory Report Highlights
Refineries operated at 91.1 percent of their operable capacity last week. U.S. crude oil imports averaged nearly 10.9 million barrels per day last week, up 560,000 barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged over 10.6 million barrels per day, or 563,000 barrels per day more than averaged over the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 1.3 million barrels per day.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) rose by 2.0 million barrels compared to the previous week. At 344.2 million barrels, U.S. crude oil inventories are just above the upper end of the average range for this time of year. Total motor gasoline inventories climbed by 1.5 million barrels last week, but remain well below the lower end of the average range. Distillate fuel inventories increased by 0.5 million barrels per day, and are just below the upper end of the average range for this time of year.
Total products supplied over the last four-week period has averaged 20.8 million barrels per day, or 2.2 percent above the same period last year. Over the last four weeks, motor gasoline demand has averaged nearly 9.4 million barrels per day, or 1.2 percent above the same period last year.
Who’s most to blame for record-high gas prices?
Poster: Albert A. Bartlett
Comment: Demand for petroleum is close to exceeding supply, a situation that was predicted in 1956 by M. King Hubbert. Hubbert made many reports to the Congress in following years, pointing out these facts very clearly. The Congress has ignored the reports for decades. The Congress is to blame for the high price of petroleum in the U.S. The same thing is happening with natural gas. Production has peaked in North America, so prices will rise substantially every year from now on.
Oil inches up ahead of stockpile report
U.S. government stock data is due for release at 10:30 ET. A Reuters poll of analysts has forecast a 1.4 million barrel rise in gasoline inventories over the week as refiners lifted output ahead of the Memorial Day holiday this weekend, which marks the start of the summer driving season.
Gas prices at new heights; at $3.50 a gallon, some put brakes on holiday plans
Whether prices go even higher this spring and summer, this year’s peak will far eclipse previous local records of about $3.10 a gallon set during the last two summers. Current prices are about twice what they were when regular bottomed out in the $1.70s a gallon in mid-January.
Eastern Germany's sunny future
Germany has invested $1.3 billion in photovoltaic research over the past decade, creating a $5 billion industry that accounts for 52% of the world's installed solar panels. Of 45 producers in Germany, 33 are start-ups in the former East Germany, employing 70% of the industry's 8,000 workers, with 2,000 new jobs on the way. Even companies headquartered in the west have most of their production in the east.
Impact of rising gas prices 'fairly limited', economists say
Drivers may be griping about record high gasoline costs, but the recent surge in the price at the pump will have little impact on most consumers and will be hardly noticed in the broad economy, say several economists, including those at Standard & Poor's, LaSalle Bank and the Federal Reserve Bank of Dallas.
The Pros And Cons Of 'Price Gouging'
As gas prices rise a coalition of Democratic governors, including New Jersey’s John Corzine (left), have issued a letter to President Bush urging him to support legislation working its way through Congress that would prevent “price gouging” at the pump and help them pressure oil companies into reinvesting profits to increase their capacity.
House plans pre-holiday vote on gas price gouging
The bill makes it unlawful for anyone to sell crude oil, gasoline, natural gas or petroleum distillates at a price that is "unconscionably excessive" or "indicates the seller is taking unfair advantage of unusual market conditions to increase prices unreasonably." The legislation leaves enforcement to the Federal Trade Commission. Punishment for a corporation can include fines up to $150 million and for individual fines up to $2 million and up to two years in prison.
Tyson Slocum, director of the Energy Program for Public Citizen, charged that the major oil companies have not re-invested their "windfall profits" into ways to ease prices for consumers but rather into dividends and stock buybacks.
BP leak causes further chaos at Prudhoe Bay
Oil giant BP has been forced to shut down a quarter of its operations at its Alaskan oil field following a water pipe leak. The company, which discovered the leak on Monday, said it expected production at its Prudhoe Bay field to be down by around 25,000 barrels per day while action is taken to repair the leak to a processing facility which separates water from crude oil. "We expect the facility to be down a few days while repairs are made," said BP spokesman Ronnie Chappell yesterday, giving details about how long the damage could take to repair.
Russia slams US bill to sue OPEC groups
Russia said the US House of Representatives broke international law when voting to approve a bill to allow the US government to sue OPEC and similar organisations for price manipulations. "This decision is a violation of the norms of international law," Vesti 24 state channel quoted a statement by Russia's Foreign Ministry as saying.
A few extra stories from Stoneleigh:
India to seek exploration rights in Iraqi oil fields - oil minister
India will offer Iraq help in building refineries in the war-torn nation in return for oil explorations rights when Iraqi oil minister visits here later this week, the Press Trust of India reported.
Russian oil companies increase drilling 37.8% in Jan-April
Russian oil companies drilled 278,500 meters of exploration wells in January 2007, up 37.8% year-on-year, in addition to 4.2 million meters of production wells (also up 37.8%).
Gazprom to press on with EU investment
Gazprom, the Russian gas monopoly, pledged on Tuesday to press ahead with downstream investments in the European Union in spite of uncertainty generated by worsening relations between Moscow and Brussels.
Alexander Medvedev, deputy chairman, insisted the group would stick to its existing programme of diversifying outside Russia and investing in the EU.
"Our strategy was already announced several years ago to become a leading world energy company which will participate in all parts of the value chain and with a diversified portfolio of products and diversified geographical activity," he told the FT in an interview.
Brazil energy minister quits on corruption accusation
Rondeau, 54, said he is innocent of the accusations, but said that he would resign "to avoid jeopardizing the energy sector ... and so that the image of the government is not affected in any way."
A Federal Police report leaked to the press raised suspicions that Rondeau had received 50,000 dollars from Gautama Construction, accused of involvement in a public works fraud network, which led to the detention last week of 47 persons, including politicians, businessmen and bankers.
Gazprom exec: natural gas pact unlikely
The idea of natural gas producers forming their own cartel akin to OPEC is increasingly unlikely, the deputy chief executive of OAO Gazprom told a German magazine.
In a report set to be published Thursday by Capital magazine, Deputy CEO Alexander Medvedev was quoted as saying that it would be difficult for natural gas producers to form such an organization to mirror the structure of the Vienna-based Organization Petroleum Exporting Countries.
"Our business is based very much on long-term supply contracts. It is therefore impossible to develop a cartel mechanism like OPEC," Capital quoted Medvedev as saying.
EIA Chief:US Retail Gasoline Prices Aren't At Peak Yet
Record gasoline prices are expected to continue until at least June due to ongoing U.S. refinery production problems and low imports, the head of the Energy Information Administration said Monday.
EIA chief Guy Caruso concurred with suggestions that U.S. retail gasoline prices haven't hit a peak yet.
"No, I am very hesitant to say we've reached the peak, mainly because we have ongoing problems in Nigeria, which are very important not only to the light sweet crudes, but Nigeria itself is having to import gasoline, putting pressure on the global market for refined products," he told reporters on the sidelines of an energy seminar.
US looks set for trade war with Chinese
The 14 Chinese ministers, led by Vice-Premier Wu Yi, appear not to have brought any concessions strong enough to satisfy the growing US anti-China lobby.
The cover of the latest edition of The Economist, reflecting this mood, features a panda version of King Kong marauding through New York, and the headline "America's Fear of China".
Democrats who now control the US Congress complain about China's $283 billion trade surplus with the US last year, claiming it is substantially due to an undervaluing of the yuan that helps China's exporters, and are calling for a revaluation of up to 40 per cent.
A week ago a trade panel voted to impose special duties of up to 44.3 per cent on imports of polyester fibre from China. A few weeks earlier, the US imposed duties on glossy paper imports.
Several items of new legislation, including one that would impose a 27 per cent tariff on all Chinese goods, and five concerning currency issues alone, are on the table. Their introduction would lead to a full-scale trade war.
Once and Future Environmental Leader?
Brazil appears to be about to pass over a prime opportunity to affirm itself as a leading environmental power in negotiations to bring the threat of global warming under control, according to environmentalists and analysts.
Crowned with the dubious honour of being one of the five countries that produce the most greenhouse gases, Brazil is unique in that three-quarters of its emissions of these gases are due to deforestation.
A drastic reduction in deforestation could be achieved simply by enforcing what is already official policy: that is, stemming the advance of agricultural and mining activities as they illegally encroach on the Amazon rainforest.
But the administration of President Luiz Inácio Lula da Silva is refusing to commit to specific emission reduction targets, which so far are compulsory for only 35 industrialised countries.
Saudis to top Baker Hughes books
An executive at Baker Hughes said today the US oil service company expects Saudi Arabia's state oil company Saudi Aramco to become its largest customer in 2007, replacing both the UK's BP and Us giant ExxonMobil, which have historically vied for that role.
Kuwait drops peg in body blow to Gulf currency union
Kuwait unshackled its dinar from the tumbling U.S. dollar on Sunday and switched the exchange rate mechanism to a basket of currencies, throwing plans for currency union with other Gulf Arab oil producers into disarray.
Kuwait's central bank, which battled speculators for weeks to defend the peg, said the dollar's slide against other currencies had forced it to break ranks with fellow Gulf states to contain inflation from the rising cost of some imports.
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Serendipity - I was just wondering if this link, http://money.cnn.com/magazines/fortune/fortune_archive/2007/05/28/100049... , had been posted. Pretty hard numbers, which is not always the case.
No need to check about the link further - it is either double posted, or this is a first post.
I will stick it in there. Not sure if Stoneleigh is managing the Drumbeat this morning. (Stoneleigh, if you are about to post a bunch of stories, you can change the Drumbeat author to yourself.)
I'll do one tomorrow, but please feel free to add to it as you know more US sources than I do. If I do DrumBeats too often the non-Canadians will get bored :)
By the way, if any readers have articles that they'd like to see in the Drumbeat while Leanan is away, they can send me the links at Stoneleigh2006(at)msn(dot)com and I'll add them.
Feel free to throw your own stories in there as well. I have 2 sources that I use. I get a constant news feed at work that sometimes has stories that I don't see anywhere else. On top of that I do Google News searches for keywords like "peak oil", "gas prices", "energy conservation", etc.
Where's Leanan? Just some time off I hope?
Vacation.
Whoa, that's an early Drumbeat. If some stories don't start popping up soon, I will try to stick some in there. Today's inventory report promises to be interesting. If we see anything less than a healthy gasoline build, it's off to the races again. But I think we are likely to see a build, and gasoline prices to soften by middle of June.
They ran Ethanol Demand Is Boosting Food Prices Worldwide on SlashDot yesterday. It's worth a browse and it's a good demonstration of comment moderation. If you look at the 36 3+ comments they aren't too uninformed. If you go below that into the rest of the 462 comments, well... you can see what the average computer nerd is thinking. Not much general knowledge about energy and even less about agriculture.
hence the crude oil to rise?
Crude supplies have surprised me lately; rising when I thought they would fall. Normally I would expect high refinery runs to be pulling on the inventories, but the recent refinery problems have resulted in crude builds. I won't be surprised to see another crude build, but I expect to see crude inventories fall, and gasoline and distillate inventories rise.
I know my gasoline prediction is in line with that of the analysts, but I don't think I have seen predictions for crude and distillates.
Bloomberg survey: Crude +0.6 million, Gasoline +1.20 million, Distillates +1.30 million, Refinery Utilisation +0.45%
Reuters: Crude +0.60 million, Gasoline +1.40 million, Distillates +1.20 million, Refinery utilisation +0.40%
Could it be that the SPR not buying oil is causing the rise?
I was having a quick look at the ExxonMobil 2006 annual report today: http://www.exxonmobil.com
While the bottom line is 135% reserves replacement ratio, 75% of their reserves additions were through purchases! (746 out of 990 million barrels, before year end price effects). Somebody else lost a lot or got completely swallowed to give Exxon such a rosy shine :-)
Year end price effects added another 325 million barrels, so total additions were 1315 against production of 976. Don't know why year end revisions were so high, especially because the oil price at the end of 2006 was about the same as end of 2005.
cheers
Phil
www.philhart.com
So, according to your numbers, their production was 733Mb and they found new reserves of 244Mb, so they only replaced 1/3 of their reserves... actually, it is even worse than this WRT liquids...
THey are booking new gas reserves in Qatar and calling them 'boe'; production from old fields are mostly liquid while new reserves are mostly lesser value stranded gas... and, worse still, their investements and 'reserves' in Venezuela are disappearing. IMO, gassier xom will find oily oxy irrisistable at, say, a modest $60B.
XOM does not just know the future, they are in it.
And yet they continue to push demand up as much as possible with their denials of peak oil and their denials of global warming.
Good guess about Occidental, if XOM doesn't want them, Chevron or Connoco-Phillips will. The annual report also boasted about 11,000 acres in the Newark Barnett Shale (Fort Worth), and their land acquisitions in the Piance Basin. That's all economicially marginal gas, but its their first significant onshore US plays in 30 years. They also have a big woodford-barnett play in the Marfa basin, not in their report. I'm thinking that the political heat is making them pursue US gas exploration.
One notable absence is the Athabasca tar sands, which means they don't consider it an economic play.
These figures are oil (liquids) only. Exxon does at least report oil and gas reserves separately, unlike most of the other major oil companies, who are indeed using BOE to hide their own oil reserves failures.
Who’s most to blame for record-high gas prices?
There were lots of responses, but this one caught my eye:
http://www.pbs.org/now/php/quotes.php
Maryland McMansions growing even larger
State ranks second in percentage with 4 or more bedrooms
By Timothy B. Wheeler
Sun reporter
Originally published May 23, 2007
http://www.baltimoresun.com/business/realestate/bal-te.md.homes23may23,0...
Meanwhile, here in Baltimore City we had ten shootings and three stabbings within a 24 hour period.
Thanks for the Bartlett comment...that is priceless.
Rick
Yeah, that gets top billing in Drumbeat for now. At least until the inventory report is released.
Letter to My Senator, Jon Tester:
Robert,
You are ecoming to the defence of your industry, as I would too. I have these observations.
Politicians must get elected - this is not your or my world, everything they hear goes through that filter. What you see in these hearings, and that you don't like, is highly refined filtering by people who live and die by what the average person thinks. They are at the top of the political heap, these are the most politically savvy people you will ever see. You are getting your views sent back to you with editing, take notes.
The years of making less money doesn't fly with the ave. voter. I see this all the and it makes me mad too. "Oh you are rich!" (sorry lets go back to the days where we recorded using a stamp in a ledger, and talk about being poor) "Oh! I would never live like you did!!" (Well then shut up). You will never get them to understand - never.
Americans are scandal weary. Enron? Collusion? Conspirisy? Price Setting? Average voters will not believe you - It doesn't matter what you say. Politicians know this all to well.
If you want a consumption tax I think it will have to come out of oil co profits. It is the only workable political solution. Pass it on to the customer like every other expense.
This situation is only going to get worse, and you know that. If your industry believes PO is upon us then they will need to do some business soul searching. This won't be business as usual.
I wish you luck. You are in an ever tightening vise imho.
You are ecoming to the defence of your industry, as I would too.
It is not a blanket defense, though. As I remarked in the gas prices thread, there are criticisms that are valid. My objection here is that the Senate Energy Committee, for God's sake, is spreading misinformation. Spin is one thing, but when you state factually inaccurate information in a public hearing that is covered by the media, it needs to be exposed. If they don't even know the facts, how on earth can we expect them to formulate any sort of coherent energy policy?
We are facing some tough times over the next decade, IMO. The Energy Committee needs to be well-informed if we are to have a prayer.
If you want a consumption tax I think it will have to come out of oil co profits. It is the only workable political solution. Pass it on to the customer like every other expense.
Believe it or not, I am starting to come around to the same conclusion. The problem I have is the incredibly naive view that politicians are going to make the oil companies pay for running gas prices up. Over the long-run, investment will dry up and supplies will run short faster - dramatically boosting prices. It is incredibly inefficient, and will play out over a longer period of time than a simple gas tax, but it may be the only measure that has a prayer of passing. Of course the politicians will stand around scratching their heads a few years later when gas prices have doubled again.
I admire your efforts to get the information correct. It seems obvious to me that energy is the critical issue we face. I hope you can bring this awareness to the politicians. This will not be business as usual for them either I have a feeling.
Delusional, (and Robert)
Corporate Amurkah!!!!
After what we have seen the business execs(CEOs et al) do to this countries workers,its industry and its business environment? All in the name of absolute flaming GREED?
That I would somehow TRUST the oil execs and their thin scammy screed?
Get f**king real won't you?
Those kingpins like Lee Raymond who parachute safely to ground on golden wings of unbelievable riches, taken from WHO?,,,after I see this revolting bullshit then I am to take what they say as gospel?
I take it as just more greed and ego and am not certain in the least that they give a tinker's damn for the folks in this country and our lives. Just so long as they can exist in their ivory towers and look out upon the squalid masses consuming their products and be happy that they are above it all.
Yep, fly me to Acapulco. Let me dash away from this maddening crowd, my fine clothes, my trophy wife,,etc etc...yada yada
I saw it all in my years working for the corpos.
There was a day when the employee was respected and the companies were patriotic. Now they salute the dollar and greed. They could give a shit less about us out here on the highways and byways with us wondering what the hell is going on and what will tomorrow bring.
I hope that Joe Sixpack does get this real rude awakening and rips some of their assholes out. Thats my wish.Also take the frigging politicos out on a rail with tar and feathers and would serve the filthy scum well.
They stood by idly while this country began to choke and now will die and they want CLEAN HANDS? The supposed folks who run this country and the execs who are at the top of the food chain? They want a secure lifeboat? They needn't to want to stop by my campfire on the way out of hell. They won't be welcome.
Yeppers,,I don't buy what they are touting for one solid millisecond. Its all a game to f**k us over. Yeah we grabbed the golden ring on the merry go round but only becuase they put it their in our reach and enticed us with soooooo many advertisements of the good and golden life. The life that only they seemed to get.
Airdale-forgive me but I just got off the phone with corporate hdqtrs for Andersen windows who I paid $1500 to for a piece of junk bay window put together by illegals in some hellhole distribution junkyard and all the midlevel exec could say was " sorry to hear you feel that way". A 24 page assembly and installation set of doc that might just as well have been thrown in the trash. I think no better of any corporate officers in this country where pride and quality once was practiced, at least by the working man. When they invented Corporation and Corporate law then the start of the END was just created. We are now living that end. No one is responsible yet everyone is on the take or is on the outside looking in and wanting a piece of the action.
PS.Its a rant,yes but I think some rants are in order what with the train wreck ahead on the rails and growing bigger every day. Someone besides the consumers are to blame as well for I don't see ANY clean hands out there. They used every trick in the book to screw us into their gameplans.
Cheap energy...they are still touting all their bogus claims on reserves. When will we ever learn that Corpos are born liars?
So begins the "Anger" phase in the US...this will be a long and painful phase in our history and I would be scared if I were in a political office right now.
Wait until the recession/depression hits. People are angry now, then the will be rabidly insane. Watch the news for daily attacks on Hummers and their drivers, Gas truck hijacks, gas stations on fire, etc....i wouldn't even blame them or stop them. I'm angry too.
Did someone say Hummer?
fuh2.com
Sit in the recliner by the side of the river and watch the bodies of your enemies float by. :-)
There was a report here in KC, MO yesterday about someone that broke into a U-Haul lot and drained the tanks of some the moving vans in the lot. Makes me nostalgic for the 70's.
...nostalgic for the 70's...Where are the hitch hiking girls with the "My ass, your gas" signs. That would be an eye opener for my son. LOL
RR, why do we hate the corporations so much?
Consider a post I copied down at TOD a couple of weeks ago:
***
From here...
http://www.census.gov/hhes/www/income/histinc/h05.html
I get $17,710 as the median income in 1980 in 1980 dollars. Then I
plug 17710 into here....
http://www.minneapolisfed.org/research/data/us/calc/
and I get $44167. Using the same table as the first link I see median
income in the last year reported (2005) as 46326.
***
5% growth in 25 years? That's worth rioting about. Yet the corporate media tell us we've living in an economic boom... we must be, because corporations now (mis)rule our roads, our utilities, our healthcare, our security, our military, our religion and both political parties, and how else can that be justified except through massive economic improvement?
Of course the average income has gone up a lot more than the median. And the executive and shareholder class are a large part of that, and have used that growing advantage to make America more unjust in every respect.
So either we scapegoat the oil companies in particular for our financial distress, a task made easier by Cheney, Bush, Rice and Khalizad all being tied to your industry while we wage war on oily Arab soil, or we get mad at the entire corporate system, which means declaring war on capitalism itself.
As the demon said in Ghostbusters: Choose the form of your destroyer!
By the way, do you think once the combined excess death toll from peak oil and global warming hits 100 million, someone will calculate how many years of mitigation efforts were delayed by oil companies and their pet political parties denying that there was a problem? Let's stop talking about price gouging and start discussing crimes against humanity. As in, corporate mass negligent homicide on a scale that will dwarf Communism and fascism combined.
Go to the BLS website and try that calc on non-supervisory wages. That +5% becomes a very negative number.
No arguement.
I'm no fan of 1,000,0000+ exec's. The rank and file has suffer you are correct. We are in a heap of trouble.
It started so quitely. I went to buy a simple dial microwave for my daughter when she went to college 4 years ago. Bi-Mart $29.95. Same power as one I bought when we moved to our current house 16+years ago that cost $114.95.
There are a few people (4) that I know that see the problem with this. Most are so fucking happy with low prices they can't believe it.
Every dime you spend buying cheap imported goods is giving economic power to some one else. Our government has allowed this while telling dosmestic bussinesses to compete with all the wage and hour laws, enviromental laws, etc. This has been going on for a long time in 1,000's of diferent ways. Everyone espired to be come yuppies and low prices allowed (Wal-mart) to expand accross america and force the small guys out.
We have chosen the form of our destroyer one dime at a time.
The problem isn't so much buying some things from overseas, it is the systematic gutting of our economy to the point that we have nothing left to export in exchange.
We needed to have a rule in this country that for every dollar that we spent on imports, we had to earn a dollar on exports. That would have made a huge difference - especially wrt energy.
While the oilcos hardly have clean hands, I do think it is a broader thing. It is not that capitalism is altogether a bad thing, it is just that we have allowed a good thing to go too far.
Economists classify all goods as falling into one of four categories: private goods, public goods, toll goods, and common-pool goods. The hypercapitalist ideology in the US has been aggressively pushing the privatization of the toll goods and common-pool goods sector, and the shrinkage of the public goods sector, at least since Reagan (actually, starting long before that). State socialists, of course, always want to expand the public sector, absorb the toll good and common-pool goods sector into the public sector, and minimize the private sector.
We've already learned that state socialism doesn't work very well (except for the people in power). We are now learning that hypercapitalism doesn't really work very well either (except for the people in power).
What MIGHT work? How about a system that had a healthy private sector and a healthy public sector, each confined within their appropriate sector? And what about toll goods and common-pool goods? These should neither be privately owned nor government owned, but PUBLIC owned, and run along the lines of cooperatives. Each asset -- utilities, transport modes, fisheries, etc. -- should be managed by a directly elected board of trustees; it is essential that the trustees not be appointed by the government, that is just another form of state socialism. It is the direct vote for trustees that establishes the feedback loop to balance price vs quality of service. Each entity would need to be run on at least a break-even basis, no subsidization, and the government would apply the same regulatory regime to these enterprises as applies to the private sector.
In the case of oil companies, refining and distrubition (which at this point are essentially a utility) would be reorganized on a cooperative basis, while exploration and extraction (which are necessarilly entrepreneurial) would remain privatized. Were we to run the petroleum industry this way, I suspect that there would be far less complaining and scapegoating.
What you describe sounds quite familiar for my country. Lots of institutions (universities, hospitals, schools,...) are non-governemental organizations that are not run for profit.
While being an improvement over 19th century style industrial capitalism, it suffers from the same flaws. There is still an upper class and a lower class, except now they are (mostly) geographically separate (1st world vs 3rd world), plus an oily sauce that allows more stuff to go around and the middle class to expand a bit.
Ultimately, we're still a feudal capitalistic society. If you're starting out in life nowadays, you need to go to the bank and you ask a loan (for a house, a business,..). The bank gives you that, on the condition that you pay a large part of your income for the next few decades.
If you were starting out in 1400, you needed to go to the lord and you asked a piece of land. The lord gave you that, on the condition that you paid a large part of your income for the rest of your life, which probably was the next few decades.
As long as we allow people who have a lot to demand tribute from those who need a lot, it will give the same effects.
Airdale: Thanks for the tip on Anderson windows.
No, tar comes from petroleum and is thus MUCH TOO VALUABLE to waste on the filthy scum!
Beeswax. No. Pine pitch. That'll do nicely.
What bees?
Not a RANT Airdale, POETRY! dark explicit and ominous.
(Corperate = Government
Politicians = Public Relations.
and 1984 never had it so good.)
Hot Damn! I've half a mind to jump on my vespa (sorry I sold the soft tail when I got hitched and had kids) and head over to your place with a couple 6ers of Buckhorn to shoot the $hit.
When ever I talk like that I clear the room or the bartender kicks me out. I like your style.
We all ought to think about meeting somewhere in the middle for a big TOD BBQ.
Cheers
Souperman2,
I ask...why didn't the oil execs just tell us the plain simple truth? "We are in deep kaka and its looking really grim,its a shitstorm in fact"...."The reserves are somthing we just lied about to help our 'bottom line'." CERA,EIA,DOE,XOM.... all those alphabet name entities.
Why doesn't the President of the worlds largest superpower just stand up and say:"Folks many of us will die, millions of us if we do not get our shit together and fast."
I know..not legacy material. Not good for golden parachutes either.
I am still watching for when the ANGER does set it. When it does this country will never be the same again, IMHO. God help us when it does. I remember the 70's embargo and it was nice compared to what is upstream and heading downstream.
Airdale--best I get back to the garden and STFU.Now where did I put that fifth of Wild Turkey?
PS. For wannabe amateur radio folks or exhams here is a couple good websites: A good wideband HF receiver will at least let you hear what it happening if the lights go out and you have a few PV panels to power it.No license for listening required. A long wire will do nicely with a dual ladder feedline.
www.texastowers.com
www.hamstation.com
Well I reckon if those entities came out of the closet and declared a global shitstorm we would have alot of angry people rioting in the streets. And I mean alot as in more than the entire LAPD can taze and mace all at once. So its probably best to keep our blinders on until we get to the fancy new KBR detention camps.
Well Airdale what can I say?
I hope for some success with politicians but have my doubts. I think they need to be occupied or they will come up with something worse. We need some direction - I think Big oil should invest in rail personally, but I don't make the rules or decisions. If they get smacked with some windfall taxes maybe they will decide to invest in rail, solar, something.
I understand your anger with the corp. exec. grab and run. Very shitty thing to do. I need to run. I will continue in a minute....
If they get smacked with some windfall taxes maybe they will decide to invest in rail, solar, something.
I believe you're on to something. We have Robert acknowledging today that windfall profit is probably the only politically acceptable 'carbon-lite' that the public will accept. (He notes that clearly it will de-incentivize the riskier side of the oil companies' operation and cause fuel prices to rise)
Do this but exempt oil company profits that are invested in wind, solar, and light rail. Like you say. If we can't get the carbon tax one way what about your more politically acceptable alternative? After all we're "addicted to oil" help us get off!
Heck at $4-$5 a gallon gas it'd be popular. And who else is going have the capital needed. Government? What is wrong with this?
(back...)
So when given lemons...
I don't like this mess any more or less than anyone else. I'm just looking to work with what we have.
Could this turn violent? I don't think that is a stretch at all. WT's Lime green volvo's might be worth millions to an oil guy trying to escape with his family. It just depends on how bad things get before the politicians step up. The oil co's have some options right now that I don't think they will have later. If they believe in PO then they will have to move decisively. The sums of money will only get bigger and the public outcry louder. It just a matter of time imho. I'm no fan of multi-million dollar exec's, but they do have to make decisions. I think they have to make better decisions than the Gov't. The gov. loses our money(and could give a shit) the oil co's lose thier own money (this is THE difference, you can get fired for fucking up).
I suspect there are a great many airdales out there with imo resonable complaints with how things are getting done. How reasonable people will react is going to be situational. I don't think this will go smoothly and that is again why I think there must be some direction(s).
I worked in a gas station during the first crisis in early high school.I remember the lines, people were pissed. Odd/even, closed on sunday,$10.00 limit, but I didn't see serious violence.
This has a greater potential of getting really ugly imho. I'm too young to sound this old but - I look at how many people run red lights. It happens every single time I go to town. People have lost decency, so if we get in a crisis I think the civility bar is lower(ed)to start with. It doesn't take much for me to agree with WT and his volvo idea. Look at the aftermath of Katrina, those poor people are buying handguns right and left TODAY, there is too much crime, and people feel the need to protect themselves.
Portland, OR has a PO group. They have a website. They have approached the Portland City Council with thier well thought out PO plans. It includes directing unemployed people to work in mitigation projects. Its worth a shot as the alternatives are not pretty.
Airdale, I don't disagree with you at all. I just think we have to give ourselves a chance. I will, like you, be prepared for 'all' of the worst.
D
Ahhh Delusional,
I agree with your reasoned response. But to hell with reason when the pumps run dry and your miles from the beehive.
I just want an answer to this question:
When did it become fashionable to be a lying SOB?
Why didn't they tell us? Why do they run it down to the last microsecond? Why are they still lying?
Oh....I see the shareholders.. and looking out for the interests of the frigging shareholders. What a crock of bull! The shareholders have no loyalty except to a dollar. They could care less about a company and its people. They strade on a whim. They spin on a dime. They sell short. They sell long. They sell if their crotch itches.
The SHAREHOLDER'S INTEREST? This just translates to : Let me screw everyone that works here and outsource the shit out of this company so the "SHAREHOLDERS" will be happy. Bullhocky!! Its just too transparent.
Airdale-been there when it was good and was there when it started to go bad but left before the sucker punch landed.
Class of '57 , and retired in '89 on a short VLA window while HR was just someone's wet dream.
I just want an answer to this question:
When did it become fashionable to be a lying SOB?
I don't know....
"fashionable" is the key word. They have always been there but to what degree? I agree it is over the top.
I watched Jeffery Skillings congressional testimony, I hope he rots in hell. What amazes me is - Did he think he would actually get away with it? Come on, this wasn't an apple off the neighbors tree. My fishing buddy says every dog has his day, believed it too.
That would be November 2000 to be exact.
It has always been fashionable to lie for greed (money/power).
Corporations as legal entities/legal people have allowed many who are riding the business wave to lie to themselves and the mass population in pursuit of greed. Our culture, to a big degree, has been influenced by it. We all are (or have been) a party to it and a victim of it, to some degree or another.
"You can never solve a problem on the level on which it was created."
Albert Einstein
I think there are two steps actually.
First is the limited liability corporation. This gives people a legal way to avoid responsibility for their actions.
Second - I don't know the term - but folks like mutual fund managers, when they vote as shareholders in a corporation, they are legally constrained to take a very narrow view and vote to maximize direct shareholder return, i.e. to ignore indirect shareholder benefits like reducing air pollution so shareholders don't get lung cancer etc.
I heard a curious report about this on the radio in the past week. I think it was an interview with a union leader, like from the UAW, somebody representing the interests of Chrysler employees. The union pension fund manages lots of money, and invests a lot of that in automobile company stocks. So they are sometimes stuck voting to shut down unprofitable factories, which of course puts their members out of work. But they are legally required to vote to maximize the direct return on the investment.
Adam Smith's Mistake by Kenneth Lux would likely give additional insight!
Airdale, I honestly do not think most of them are lying in general. I think most of them believe all the cornucopian positions they spout. After that, all their actions follow logically. Bad assumptions, bad conclusions.
Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett
$1500 for a bay window? OMFG! Yes they will screw you on that. Buy Marvin, pay $100,000 for a bay window bench-built by one highly skilled millwright and they will kiss your a** if you measured something wrong and an adjustment is required. Consumers who expect a window that works for 1500 just get it up the rear hard. Welcome to Murkah.
Which is exactly what we need. We actually desperately need $5 gas and for demand (and the oil industry itself) to contract thus flattening the peak and leaving oil for future use.
In the 70's etc, war and it's fallout in the middle east did much more than any other factor to promote efficiency and conservation in the West and to delay peak oil.
I'm not suggesting we destabilize the Kingdom of Saudi Arabia in order to flatten the peak -- though it would probably work. But just want to point out that inefficiencies and long term disruptions that keep oil underground might be a good thing.
Hobbling the oil companies with all kinds of unfair taxes and regulations might be good for America in the long run.
They are far too good at what they do.
You mean like this?
I too think a gas tax is the way to go. The usual behavior when politicians want to do something that is unpopular is to appoint a blue ribbon committee to develop recommendations. Anyone know if this has been or will be tried?
I think it was Carter or Reagan that did a windfall profits tax. 10% if I remember correctly. Oil guys?
I think it was Carter. I don't remember the number. But I do remember that the post mortem done by the GAO said that it did increase costs and shrink investment. Ineffecient, for sure. But maybe the best we can hope for.
Hi Robert,
Please let us all know if you get a reply at all to that, and if so whether it is like a form letter or did someone sincere do the reply. Also, have you managed to get replies from them before?
good luck,
Bruce
Tester is a freshman senator, so no experience dealing with him. I will let you know if I get anything other than a canned reply.
good luck, robert.... i sent him a letter back in december about my peak oil concerns with links to matt simmons. i also sent him an e-mail on the same topic. ....so far no reply whatsoever....i only hope he's found the bathroom by now.
Robert, according to the June 2007 "Men's Journal", Jon Tester is a large-scale (owns a combine!) organic farmer. A quote from the article: "...Tester is talking animatedly about his favorite subject, renewable energy, and how he plans to push it from his new perch."
When you get stateside it might be worthwhile meet him when he's back in the home district.
Best hopes for another ally in Congress,
Errol in Miami
Yeah, I knew that about him. He is a likable sort as well, but it was hard to vote for him after he repeatedly said that I work for Satan. I told his campaign worker to carry that message back to him - that we do not control gas prices. But, I voted for him anyway. My wife wasn't really bothered by his slams of the oil industry, so she voted for him without hesitation.
HAH - No more so than much of the oil industry. The fantasies are just different.
If you are looking for something different, the business columnist for the Washington Post will be taking questions today at 11AM.
http://www.washingtonpost.com/wp-dyn/content/discussion/2007/05/22/DI200...
The topic is rising gas prices. Steven Pearlstein has took several questions related to this in the past. He has called "peak oil people" a cult, but generally seems open minded about stuff. You can read hs current column on gas prices (and his proposal) here
http://www.washingtonpost.com/wp-dyn/content/article/2007/05/22/AR200705...
Ya...saw that and thought...you know we've been doing this kind of thing for the last year or so...running more and more warships in and out of that area, but this time kind of worries me due to the US sueing OPEC, the uncharacteristic early rise of gasoline prices, Iran raising fuel prices, Kuwait's unpegging of the US$, and today's Weekly Petroleum report.
Nothing like adding some more sticks on the camels back.
Today is the day that the UN Security Council resolution demanding Iran cease uranium processing expires. IAEA will file a report on Iranian (lack of) compliance.
The arrival of these two carrier groups is a non-too-subtle threat
Ewww...that camel's knees are starting to buckle!!!
So the Nimitz aircraft carrier group is in the Gulf now, flexing muscle along with the Stennis. The Eisenhower is still in the region as well.
By the way, does the IAEA monitor US or Israel nuclear sites?
IIRC the Nimitz is steaming in to relieve the Stennis (I think, could be the Eisenhower) who is completing her tour and heading home.
At least that's the offical line.
By the way, does the IAEA monitor US or Israel nuclear sites?
Yes, and no. The US is a signatory to the nonproliferation treaty and others which require IAEA monitoring. Israel is not.
Received in mail Wednesday May 23, 2007.
Likely a response to our filing MOTION TO VOID JUDGMENT ...
Cheers ... and keep upwind
Below envelope contained.
Received in mail Wednesday May 23, 2006
No stamp cancelation.
Just like envelope from Metro
court.
Below envelope contained
Please note warning that
case is closed on 10/27/1999. We, of course will see about
this.
"It's not how you get into these things that matters, it's how you get out of them that counts."
John Sobolewski [scroll down]
Let's see what is going to happen.
Zoubin, Parsi, Raahii.
Gas was $1.20/L CDN on the way home yesterday.
http://www.reginagasprices.com/
That's just over $4 USG/USD
It's 123.9 here on Vancouver Island
That's $4.33 US a gallon.
The $1.20 was on my way home last night. It's $125.9 here this morning.
I could follow a gas tanker out of a Canadian refinery down to Montana and purchase it back retail cheaper than the wholesale price here.
Sure, but then you'd be the foreigner in Montana driving a truck full of gas trying to get across the border. :)
A little off-topic, but we were invited to the local Norouz celebration last spring year by an Iranian friend, which is their new year celebration. We were prettymuch the only non-Persian people there and we had a great time. Strikingly handsome people and great food. Everybody dances.
We were prettymuch the only non-Persian people there and we had a great time. Strikingly handsome people and great food.
Well, now that we know that you are strikingly handsome, tell us about the Iranians. :-)
I have 3 Iranians in my group, and they are great engineers (and good people). I think it would do a world of good for your average American to sit down and talk to your average Iranian/European/African/etc. about stuff. We would have a lot fewer misunderstandings, and much less war.
Over the decade years I have developed an electronic friendship with an Iranian EE student (now working in a power plant). He was drafted into the Army and got to watch Gulf War II from Kharg Island (too damn hot there for him !)
Quite some insight into Iranian society (and vica versa). He is enchanted with the idea of Jazz funerals :-) and Mardi Gras perplexes him.
Best Hopes for Greater Understanding,
Alan
I've always liked Iranians-they are a fun bunch, unless you are talking about the religeous nuts. Those are are boring and purposefully ignorant as our own home-grown bunch.
I've an Iranian friend who is a small retail merchant, works about 36 hours a day, 8 days a week running a convenience store. As the war drums beat more loudly, he's getting nervous. He's trying to locate a farm in the Texas countryside if times get really rough for Persians.
Isn't it pitiful that a good, productive member of our society is looking for a bolt-hole?
As a incidental aside, he claims Iran has 3 nuclear weapons which the Mullahs bought from the former soviet union and that Abaminijad has talked about them in speeches. I figure it might be true and thats why our Neocon Cowboys have not started bombing yet. Like North Korea, they're just too dangerous.
Yeah, i have read it somewhere also. There are supposedly about 200 nukes missing from Ukraina. Some of them could be in Iran, and that could explain why President A is so tough in his talks.
If they have a couple guys with brains they may not even need the nukes.
Google Paul Van Riper and MC02
pls ask him to report on when he sees the nukes flying overhead. That will give us time to get on cnn and watch it live.
He lives in League City, Texas. I figure they can drive a bomb to Iraq and take out the effective fighting force of the US which seems to be under seige in the Green Zone. Luckily, Iranians don't seem to be suicidal
A nuke in a rubber raft would be more than adequate to take out two carrier forces.
"A nuke in a rubber raft would be more than adequate to take out two carrier forces."
We have to pray to God that doesn't happen. The rage from the the U.S. would make our outrage at Pearl Harbor seem like small beans. The U.S. has shown the damage it can do, even if it cannot win, when it goes into a fit of madness. (The first flyers over Afghanistan, referring to 9/11 and the Pentagon attacks said it clearly, "We have come to avenge our dead". In the minds of many in the military, the avenging still has some distance to go.
We are playing a very dangerous game, and Iran is playing an even more dangerous one. Do their citizens realize the grave danger they are in?
Americans with friends in Iran and Iranians with the ability and connections should be trying to arrange for their friends and families to get out of there.
All they have to do to see what may face their friends and families is look at Iraq, the humanitarian catastrophe may be horrendous beyone anyones ability to bear watching.
Iran MUST ask itself what it wants and why. The United States and the West must ask themselves the same question. Given the extremely vulnerable position that the United States would be placed in by a nuclear Iran, it is hard to concieve of how they would ever allow such a thing. It would be declaring the end of the power of Centcom in Qutar, and placing world oil supply and natural gas from Qatar under Iranian veto power. Saudi Arabia, Sunni and openly hostile to Iran would have no choice but to enter the nuclear race as rapidly as possible. The situation would become unstable to the point of being hair trigger. Hundreds of billions of dollars and tens of millions of lives would be on the edge of obliteration at any moment. All parties should be in EMERGENCY meetings now, unless some serious under the table diplomacy is already going on.
I am not arguing about who is "right" or "wrong" in the current argument.
I am simply shuddering at the direction this conflict is moving. The United States and Iran seem to be almost engaged in a suicide pact. Iraq has already proven to be America's greatest foriegn policy catastraphe to date. Can we withstand two at once?
Given the horrible possibilities, "peak oil" shrinks to insignificance. We are getting closer to the razor's edge, in which the abilty to produce the oil of the Persian Gulf area will become impossible anyway, not for geological reasons, but due to war, suffering and the surface destruction of a region.
Much of the oil of the world may remain underground for the rest of our lives, perhaps eternity. Peak per se, may never be tested.
"The greatest danger from peak oil is that we will do something foolish in response to it." Greg Croft
RC
Remember, we are only one cubic mile from freedom
..and great food.
now that we know that you are strikingly handsome..
I can cook too. :-)
IMO the all time best rebuttal I ever came up with was this:
SlashDot Interstellar Ark
You can't beat a good cornmeal waffle recipe as an argument tack in a Sunday morning Internet relativity discussion. :)
Iranian/Persian cuisine is great - just Google it.
It is a big place with a vast number of excellent fruits, nuts, vegetables and flowers. The main thing they seem to have difficulty growing are bananas.
The people are generally very friendly and generous towards foreigners. I would guess that now is an excellent time to visit the place as there are few tourists and the weather is not too hot or cold. Stay away from Tehran if possible - it is terribly crowded and polluted.
Because the country is largely desert, they developed over many centuries quite unique ways of handling and using it water economically (e.g. the Qanants 1 2 3 and clay pot irrigation 4 ).
Unfortunately, the cheap petrol has destroyed a lot of that knowledge. However, there is nothing to stop Australians and Americans from learning from them.
Iran's petrol problems are not spontaneous incidents, of course. Yes, they lack refinery capacity. And, yes, there are UN sanctions. But apparently that's not yet enough. We know better than the UN. From the ABCNews Blotter blog.
The comments to the blogpost accuse the writers of being traitors and putting the lives of our troops in danger.
The details are vague at best and they are only telling people what's been going on for nearly five decades and counting....come on....we already did it ONCE people!!!
Steve Kurtz posted the following yesterday on another list. I thought it extremely important in light of recent grain to fuel programs going on right now in the US and elsewhere. No URL was supplied.
Ron Patterson
LOWEST FOOD SUPPLIES IN 50 OR 100 YEARS: GLOBAL FOOD CRISIS EMERGING
SASKATOON, Sask.-Today, the United States Department of Agriculture (USDA) released its first projections of world grain supply and demand for the coming crop year: 2007/08. USDA predicts supplies will plunge to a 53-day equivalent-their lowest level in the 47-year period for which data exists.
"The USDA projects global grain supplies will drop to their lowest levels on record. Further, it is likely that, outside of wartime, global grain supplies have not been this low in a century, perhaps longer," said NFU Director of Research Darrin Qualman.
Most important, 2007/08 will mark the seventh year out of the past eight in which global grain production has fallen short of demand. This consistent shortfall has cut supplies in half-down from a115-day supply in 1999/00 to the current level of 53 days. "The world is consistently failing to produce as much grain as it uses," said Qualman. He continued: "The current low supply levels are not the result of a transient weather event or an isolated production problem: low supplies are the result of a persistent drawdown trend."
In addition to falling grain supplies, global fisheries are faltering. Reports in respected journals Science and Nature state that 1/3 of ocean fisheries are in collapse, 2/3 will be in collapse by 2025, and our ocean fisheries may be virtually gone by 2048. "Aquatic food systems are collapsing, and terrestrial food systems are under tremendous stress," said Qualman.
Demand for food is rising rapidly. There is a worldwide push to proliferate a North American-style meat-based diet based on intensive livestock production-turning feedgrains into meat in this way means exchanging 3 to 7 kilos of grain protein for one kilo of meat protein. Population is rising-2.5 billion people will join the global population in the coming decades.
"Every six years, we're adding to the world the equivalent of a North American population. We're trying to feed those extra people, feed a growing livestock herd, and now, feed our cars, all from a static farmland base. No one should be surprised that food production can't keep up," said Qualman.
Qualman said that the converging problems of natural gas and fertilizer constraints, intensifying water shortages, climate change, farmland loss and degradation, population increases, the proliferation of livestock feeding, and an increasing push to divert food supplies into biofuels means that we are in the opening phase of an intensifying food shortage.
Qualman cautioned, however, that there are no easy fixes. "If we try to do more of the same, if we try to produce, consume, and export more food while using more fertilizer, water, and chemicals, we will only intensify our problems. Instead, we need to rethink our relation to food, farmers, production, processing, and distribution. We need to create a system focused on feeding people and creating health. We need to strengthen the food production systems around the world. Diversity, resilience, and sustainability are key," concluded Qualman.
World Agricultural Supply and Demand Estimates (WASDE) (pdf)
I didn't see the numbers quoted in the report, but if you do the math the world year end grain stocks are ~55 days, so this is probably the source.
If, as I suspect, the grain stocks include seed corn. The actual number is much smaller than 55 days.
Well, the USDA website for news is here:
http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB?navtype=MA&navid=NEWSROOM
The latest grain report is here:
http://www.usda.gov/oce/commodity/wasde/index.htm
and is consumed of course by commodity folk.
The comment you copied is I believe from a Candian source (Mr. Qualman) who was doing his own commentary on the data. It can be found at this PDF
http://www.nfu.ca/press_releases/press/2007/May-07/food_supply_crisis___...
I recently read that just prior to the first oil shock in 1974 world food prices rose dramatically. Writing in "The Bulletin" of 23 April, Max Walsh wrote: "What is often ignored about this episode [the oil shock] is the critical role played by commodity prices - especially food prices - in driving OPEC's actions. Wheat prices for example jumped by 22% in 1972, then by 157% in 1973 before OPEC flexed its new-found muscles in October 1973 and hiked the price of crude oil. . . . Then, as now, OPEC was dominated by Middle Eastern oil prodcucers who import most of their food requirements. With oil prices pegged in US dollars and with commodities soaring in price, the lid simply could not be held on oil prices. . . . I recall these events because food prices have now joined minerals and energy in shifting prices to new highs.
http://bulletin.ninemsn.com.au/article.aspx?id=261320
This is the first I have heard about the connexion between food prices and the first oil shock. Does anyone know more about this? Or have any comments in the light of the current world grain shortage?
This is the first I have heard about the connexion between food prices and the first oil shock.
I always use 1973 as the benchmark $3.00 corn price peak (and other grain peak), making the point that adjusted for inflation it should be at $15-$24/bu, so don't blame ethanol for $4/bu. I didn't realize the OPEC problems started in the fall of 1973. I turned 5 in October '73 and was more concerned with the Bugs Bunny/Road Runner Hour than the Middle East.
The Financial Times has the following as one of its lead stories today:
Fears over food price inflation
Just like with oil, the market may not react in timely fashion to this situation. Since there still are 55 days of supply, the market is supplied 'at the margin' - there is enough food for now. Prices are up but not dramatically so $3.50 corn $4.90 wheat and $8 beans.
Oil and these 3 crops are of course linked, because without oil (and nat gas), the monoculture paradigm will end - 3000 years ago we cultivated hundreds of grains and had a wide and varied diet - now we are down to 5 (rice and oats) and the vast majority are hybrids (meaning commerical farmers must buy their own seeds each year - non-heirlooms).
Ive been reading increasing information on how processed soy is not good for us, yet the momentum of the soy industry is so large that its tough to reverse course - soybean oil (and corn syrup) is in just about everything.
Sigh. Interesting times and so much to do and learn...;)
I'd like to hear more about the processed soy, if you have a source you can share...
Google "processed soy health". Get 1,030.000 hits.
Right now I don't want to be evaluating claims but suffice it to say there has been buzz about soy being less than healthy when consumed in quantity for a while now.
And unless you are some kind of cultist you are consuming soy in quantity.
Sounds good. That's exactly the news I was expecting, when I bought my 4'900 acre wheat farm in Western Australia last year.
Now I'm just hoping desperately for rain. But my farm is in the so called high rainfall zone with an average of 450mm p.a. Deadline for seeding is mid/end of June.
This got me thinking...I know the US has a SPR (Strategic Petroleum Reserver), but do we have a SGR (Strategic Gasoline Reserve)?
Wikipedia says due to short shelf-life that gasonline is really not feasible for long-term storage.
http://en.wikipedia.org/wiki/Strategic_Petroleum_Reserve
So I answered my own question, but then I thought...you can add things like Stabil (http://www.goldeagle.com/sta-bil) to gasoline to make it last longer.
Any thoughts on this and any knowledge is the US Gov does put some stockpiles of gasoline somewhere?
Dragonfly41, I'm sure there are some strategic stocks in tanks at military bases. During the last Arab embargo(1978?) I saw a couple of massive miltary convoys of fuel trucks driving away from Houston while the public whined about gas prices and lines.
The tankers sitting offshore in the sealanes probably could be considered as storage, but other than these sources I don't know of any stockpiles.
Very little in the military (other then staff cars) runs on gasoline.
Lots of diesel.
50% of all DOD energy use is jet fuel. No diesel there.
US military energy consumption- facts and figures
Sorry, forgot the Air Farce.
Semper Fi.
The Hurricane folks are telling the Oil folks to move the oil storage.
How in the heck do you move oil storage? Scratching my head! While your at it those oil folks should move the LOOP to. :)
Details, details. Ubi est mea?
I'd be interested in any expert advice about a peak oil mitigation problem I'm wrestling with.
I work in healthcare logistics ( non-discretionary - good, logistics - bad!:)) organising supplies of 60,000 medical consumable products (bits of plastic) to hospitals for a quarter of England.
I'd be interested to know where manufacturers of oil based plastics are in the food chain of customers for refineries i.e. Would they go to the back of the queue behind transport needs? Is chemical feedstocks for production a seperate issue?
While we get priority for rationed fuel what worries me is
the effect on manufacturers that supply us. Priority for fuel will be pointless if we've nothing to ship.
It's scary how reliant hospitals have become on bits of plastic to do critical work, and it won't be long before our just in time global supply chains start to crumble.
In fact we're already seeing an increasing number of supplier's manufacturing / raw material problems.
I suspect your suppliers manufacturing problems are not really their inability to get raw materials, but more likely their inability to manufacture profitably by passing on the increasing costs of their raw materials to their end users/customers. In order therefore to remain profitable they will increase the price of their product significantly or no doubt re locate their manufacturing facility to China if they havnt done so already, assuming that the bits of plastic you quote, are just that.
I do not believe we will not run out of oil anytime soon, however I do believe production cannot keep pace with deamnd. This will lead to skyrocketing prices which will in turn lead to demand destruction, conservation and the viability of alternative energy sources, and for the vast majority of the planet huge social, political and demographic changes.
You probably realize this, but all of the assumptions underlying "just-in-time" inventory management are about to be invalidated and must be re-examined. As you have explained, you are looking at a world where petrochemical feedstocks and transport fuel are going to become increasingly expensive and vulnerable to disruption. It would seem to me that in such a world a substantial inventory on hand becomes much more important than has been the case for the past decade or two. I would also point out that if the price of energy inputs is constantly rising, and therefore the prices of the products that you are purchasing are constantly rising, then opportunities open up to use purchasing and inventory management as a way to game the market and possibly save some money; those savings could cover some of the cost of warehousing your increased inventories. Any uncovered cost should be viewed as the price of insurance against the types of supply disruptions that worry you.
I doubt that any national government wants to see citizens bleeding to death for want of surgical dressings, so you can probably count on your hospitals and your suppliers not being at the bottom of the queue indefinitely.
"Gissa job" Yosser Hughes
I've been told that much of the plastics use in medicine is due to labor costs for sterilizing re-useable items. It seems a throw-away is cheaper than handling, inventory tracking, sterilizing, etc. My guess is sometime in the next decade there will be a resurgence in demand for re-useable items. Even though stainless and glass syringes have more embedded energy and require energy for heat sterilization, I'll venture to guess that they will become competitive with (unavailable?) plastic ones shipped from China.
I'm thinking MAYBE ca 1900 technology will be sustainable for humanity; I hope glass and stainless syringes are available at all by the end of this century.
Best hopes for modern medicine,
Errol in Miami
all the plastic has been used up in the vinyl sided three car garage 'burbs.
The UK Energy White Paper is published today.
http://news.bbc.co.uk/1/hi/uk_politics/6681377.stm
Nuclear power is needed to help reduce carbon emissions and to ensure that the UK has secure energy supplies in the future, Tony Blair has told MPs.
He spoke as the government set out plans to meet future UK energy needs.
The Energy White Paper backs a big rise in renewable energy and new measures to help people to use less electricity.
It also says the "preliminary view" is to build new nuclear power plants, but a final decision will not be taken until a consultation ends in October.
Industry Secretary Alistair Darling told MPs a decision on nuclear power was needed by the end of the year.
The Severn tidal barrage may be a step closer:
http://news.bbc.co.uk/1/hi/wales/6681113.stm
BBC’s potted summary:
At-a-glance: Energy review
The key points of the UK energy review and Industry Secretary Alistair Darling's statement to MPs.
Energy needs
• Climate change must be tackled but the UK also must ensure it has secure energy supplies at affordable prices
• The government will publish a white paper around the end of the year on energy policy for the next 30 or 40 years
Nuclear power
• Decisions on replacing Britain's nuclear power stations need to be made in the next few years
• If nothing is done, the share of electricity generated by nuclear will fall from just under 20% now to 6% in 15 years' time
• "New nuclear power stations would make a significant contribution to meeting our energy policy goals," says the review - if existing capacity is replaced carbon emissions would be lower by the equivalent of 22 gas-fired power stations
• The Health and Safety Executive will develop guidance for potential promoters of new nuclear power plants by early next year
• The private sector will have to fund, build and operate nuclear plants and cover decommissioning costs
• Safety and security will be "paramount" for building new nuclear plants
• The planning rules for nuclear and other new energy plants needs to be overhauled
Saving energy
• Cutting the amount of carbon-polluting electricity generators will not be enough to meet the UK's target of reducing carbon dioxide emissions by 2050 - energy must be saved, too
• Consumers need better information about the amount of energy used, "smart metering", clearer energy bills and more information on home energy efficiency
• The government will work with industry on making domestic appliances more efficient and phase out wasteful goods - saying 7% of all electricity is used by appliances left on standby
• Government-owned properties should be carbon neutral by 2012
• Ministers will encourage people to make their homes energy efficient
• Energy suppliers must get incentives to make households more energy efficient, such as selling more insulation
Emissions trading
• The government is planning an emissions trading scheme for the 5,000 large British businesses and public services not covered by the European trading scheme
• There must be higher prices for carbon polluting generators
Transport
• Fuel efficiency is improving. The use of lower carbon fuels, especially biofuels, will be encouraged
• There will be most cost effective opportunities to save carbon as new technologies are developed
• The target for the amount of transport fuel coming from renewable sources could be raised from 5% to 10% by 2015
Cleaner energy
• More must be done to encourage smaller scale electricity generators - and combined heat and power plants - sited close to where the power is used
• Low carbon alternatives such as bio mass, solar power and heat pumps will be encouraged
Renewables
• Electricity companies will have to provide 20% of energy from renewables - up from the current 15%
• There will be consultations on banding the rules on renewables to encourage the growth of off shore wind power and tidal plants
Fossil fuels
• Coal fired power still meets a third of electricity demand but its heavy carbon emissions must be tackled
• Carbon capture and storage could cut emissions by 80-90% from fossil fuels
• Carbon dioxide can be stored in old oil fields - the UK is working with Norway to develop this and plans will be in the pre-Budget report
• Carbon capture could lead to saving several millions tonnes of carbon by 2020
• Steps must be taken to secure gas supplies
So...have we woken up in time? That is the question.
"Fuel efficiency is improving. The use of lower carbon fuels, especially biofuels, will be encouraged"
Q: Can we afford the fossil-fuel produced fertilizer and arable land space for biofuels when we already import most of our food?
The Severn Barrage - raises many questions:
1) Who is going to invest at least £10 billion in this when it will take at least 10 years from authorisation to producing power at a time of increasing interest rates (and keep in mind cost/time escalations of other untried, giant projects like the Channel Tunnel);
2) I attended the Wales Conference on Renewable Energy late last year and Morgan Parry of WWF, said that the construction of the barrage would be illegal under EU law as it would destroy sites designated under the Habitats Directive;
3) The former Labour "government" of Wales supported the barrage but after elections earlier this month now find themselves without a majority, though the new government (which may be led by the Welsh Nationalist Party "Plaid Cymru") has yet to be formed. Although the Welsh Assembly would have no official power to veto a barrage (or indeed nuclear power stations authorised by the London Labour government), opposition from them would in practice make it very difficult to proceed with.
Labour have been kicked out of government in Scotland (now led by the Scottish Nationalists) and look likely to lose power in Wales - two countries where many of the proposed new nuclear stations would probably be situated. Although neither Scotland nor the rather less powerful Welsh Assembly have the power to stop proposed nuclear stations, pushing ahead with them against the wishes of these countries would likely do great damage to the Labour party on a UK-wide basis, in the General Election to be held in 2-3 years time. Funny how a nuclear power station has never been built in the Thames Estuary near London ...
So it looks like a big PR battle is on the cards between the pro-nuclear lobby and the renewable/conservation greens, to be fought out over the next couple of years. All the while the UK's oil imports will be increasing on top of an already desperate balance of payments deficit, possibly with bursting housing and consumer credit bubbles too.
Do you seriously think that the Westminster government is going to site important and valuable new generating capacity in areas that are agitating for independence?
The nukes will be in England and the Severn Barrage will be controlled from the English side. Waste disposal sites, now they might end up in Wales or Scotland. That's the consequence of announcing intentions early.
As for who will fund the barrage, I can think of a few who would jump at the chance with the right guarantees - and no EU sparrows are going to get in the way once momentum is there.
As for EU you might be right. As for independence, the problem is that Wales and Scotland are in economic deficit to England so (especially for Wales) it's not feasible in the foreseeable future.
Sounds like an outstanding reason for the new nationalist governments to get as much new energy produced on their soil as possible. I saw global maps on tidal and wave power potential that made your western coast look awfully attractive. It was hydro power that allowed the PQ to lead Quebec from a backwater to a quasi-state that could threaten to secede.
Nobody mentioned the UK government statement on energy yet?
http://news.bbc.co.uk/1/hi/uk_politics/6684107.stm
In short:
All in all, most of it has been talked about before, and the pace is glacially slow.
A superb response to why is gas rising:
From Byron King :
http://www.whiskeyandgunpowder.com/Archives/2007/20070522.html
''The price of gas is rising,” said the Peak Oil correspondent, “because there are more people buying it than there are selling it. And there will be, for the rest of your life.”
http://www.theoildrum.com/node/2574#comment-192829
Thanks,
I missed it first time around.
Still good though...
People are using their brains to 'innovate' again.
Brothers of invention make a ‘cellulosic' ethanol find
I read on this very website that it was impossible to think of new things. How is this happening?
Hydrogen powers 'green' road trip
Fuel-cell SUVs travel 300 miles as GM shows practicality, cleanliness of new technology
I read on this very website that it was impossible to think of new things. How is this happening?
Reference for that, please. I have received several patents over the past 10 years. I got them for innovation. And I don't ever recall seeing on this website that innovation is possible. In fact, the sort of innovation mentioned in that story - a highly misleading title by the way - happens every day. Here's what they actually did:
But cellulosic is such a buzz word, that gets spun into a cellulosic ethanol story. Now, I need to clean up my office, and put all my papers in the cellulosic disposal. Wait a second. Paper is cellulose. Ethanol can be made out of cellulose. I am going to save that paper up and sell it to a cellulosic ethanol manufacturer. Innovation is easy. Now to contact the media.
Its All Nonsense: Why waste half the energy in the corncobs making ethanol? In 20 years corncobs will be too expensive to use for ethanol, as folks will be using it more efficiently for baking, cooking, and heating their homes as my parents did in the 30’s and 40’s. It was our soul source of heat. The corn cob separator will no longer be used as the work will no doubt be done manually.
Corn Stalks Engineered to Self-Degrade into Fuel
http://www.livescience.com/environment/070523_corn_fuel.html
..
i can just imagine the kind of horror that will cause when the altered genes in those plants cross pollinate with non gm ones.
Someone will get sued by Monsanto
I read about miracle cures every day.
Etc. etc. etc.
I am still waiting to place my order for the amazing DNA computer that I first read about in graduate school - 13 years ago.
Keywords here: Unnatural enzymatic pathway...etc
When that crap gets loose on earth we are F**ked. It will no doubt turn every plant into a mush of hydrogen and crap.
Great work you idiots.
We are doomed.
"I am shocked, SHOCKED to discover that there is thievery going on in this place!"
"Your campaign contributions, sir."
"an estimated $21 trillion in Iraqi oil". Hmm. At $70 a barrel, that would mean Iraq has 300 billion barrels of oil left. Anybody believe that?
Sure. Just look under the WMD's.
According to Boston.com the War in Iraq will cost $456 billion by Sept '07.
Now I ain't too good at cipherin' but supposin' someone thinks thars oil in that thar place worth that much.
So you takes 21,000,000,000,000
and divide it by 456,000,000,000 aannd ... uh, carry the naught, uh ...letsee, thats 46 times yer 'nitial investment!
46 and 'leventy-'leven, that is.
Who says Chimpy is dum?
This is all spelled out in his "No oil left behind" program...
Bear in mind that much of what Boston.com is citing as "cost" is actually booked as "income" by the political class, eg the military-industrial-congressional complex.
It's only cost to those who pay.
cfm in Gray, ME
Wow ... are american policymakeres loosing it ?
Full story - here at CHRON.com
I reckon this will not actually ease the gas-prices ...or?
Earth to US, Earth to US.
1) Your laws stop at your borders, no matter what your ego may say.
2) Do you really think its a good idea to annoy those you are dependent on?
Talk about taking consistent aim at your foot.
garyp , 1)Yes and 2) No
Isn't that Carter-Doctrin threatening enough , anymore ?
And inside the story it tries to make GW Bush the smart, good and wise guy ..... in this mannor :
hey , that nice behavior isn't like him.
At this stage - as such bullshit is starting to hit the fan - I RECKON its due time for the UN to take some sort of charge regarding the global energy issue - like it has on climate. And as said before IT will address ALL issues - in a maybe "final" solution, if there is one?
UN for intelligent and wise energythinking today .... as of NOW
Dont they see the links between energy and all the bad issues in the world today ?
TO me it is all talk, talk talk ...
Actually, it is... GWB is acting like any President would.
For those of you outside the US who don't know what is going on here (most Americans who have seen a few elections are familiar with this routine), this is simply more election posturing, not unlike the Senate hearings a few days ago.
Any US president would veto that bill (regardless of political party) because 1) structurally it attempts to do foreign policy which is the responsibility of the executive branch, and 2) on substance as the bill goes against past agreements and ongoing international relations.
So, why would the US Congress pass a bill given assurance that the President would veto it and the votes in congress to overide said veto do not exist?
Expect at the next election Conyers (and the Democratic party) to point fingers at Bush and Republicans claiming they are friends of oil men, OPEC, and vetoed the solution to the peoples' pain. The Democrats offered salvation but the evil Republican oil men stole it from the people.
Sad, isn't it?
Conyers is not the most assinine of congressmen of recent years, but at times he does seem to want to run for that title.
Given how widespread US media goes across the world, I often fear that many non-Americans, when watching the US from a distance, don't really know what is going on. Indeed, I've come across many non-Americans while in Japan who had the strangest of notions, based upon what they gleamed from the media.
So, why would the US Congress pass a bill given assurance that the President would veto it and the votes in congress to overide said veto do not exist?
Maybe so they can avoid having to vote on something meaningful?
PNAC - Project for a New American Cornholing
"The Art of War" ought to be required reading...
I wonder what the WTO and GATT rules might have to say on something like this. Probably something along the lines of "you have to sell your oil at cheapest price" or some such. And those rules usually apply in US's favor, not the other way around. That's part of our "technological superiority". We write the rules.
cfm in Gray, ME
While they're at it, I wish they'd do something about the Sun and the Moon. Such boring colors! And I think they need to make cool sounds when they rise and set...
This sort of legislation will be popular in the future. If they think they can legislate to death piracy on the Internet tubes by repeatedly stating in new bills that piracy is WRONG, then why stop there?
Terrorism is WRONG.
Making gas prices go up is WRONG.
Iraqis not embracing democracy as America defines it is WRONG.
Once we outlaw all of that stuff, everything will be all right, I'm sure.
No, what we really need them to do is repeal that pesky 2nd law of thermodynamics. It is always getting in the way of everything.
One of the greatest experiences of my life was when I got up before dawn at a neighbor's lakeside cottage. I sat on the front porch and listened to all the amazing sounds of wildlife as the sun rose and the world woke up.
Well! I was in a sour mood today until I saw your story on the proposed legislation.
I feel better now, knowing that our energy future is in such capable hands. This has brightened up my day considerably. Thanks!Conyers says — wipe that smile off your face!
Useful link — OPEC Basket Price
The best quote of all was the one where Conyers said "We aren't going to let them dictate the price of our gas." That's right. I wish they would keep their grubby paws off of our gas. I can't believe these are our leaders.
Here is a link to a short video I saw at the Wall Street Journal where a broker is saying he expect $4 gasoline pretty soon:
http://link.brightcove.com/services/link/bcpid452319854/bctid929885084
He also said that after traders digested today's news, they realized that it wasn't nearly enough of a build for gasoline.
Our gas
No, the build was pretty small. Imports down? WTF?
Yes Our gas!
-- signed Oil Send Here Importing Territories
My God...there is simply no hope that our Republican or Democratic leadership is going to get their cr@p together to handle what's coming in the next 2-3 years.
I do not look forward to the presidential elections in 2008 if this is all we have to look forward to.
Why? All Conyers has to do next is pass legislation declaring ALL the worlds oil as OURS.
Problem solved, reelection guaranteed.
I hate to break this to you but in terms of just plain intelligence Conyers is one of the brighter ones. And relatively sober.
No wonder he's smiling!
I've seen that before, but here's my question: Why is Exxon not on there?
Isn't Exxon supposed to be the mack-daddy of screwers?
** double post sorry **
For Pakistan, Senegal and Zimbabwe, game over....
What happens to Pakistan's nuclear weapons?
http://www.aspo-usa.com/index.php?option=com_content&task=view&id=134&It...
http://www.nytimes.com/2007/02/07/world/africa/07zimbabwe.html?ei=5088&en=35609e\
f536b62b09&ex=1328504400&partner=rssnyt&emc=rss&pagewanted=print
and ...as for the life-expectancy for Zimbabwians , it is almost "cut in half" - since the renegade dictator's farmers-revolution back in 1999.
life-expectancy is about 35 years ....
Low rainfall may cut Zimbabwe's maize crop by 50% of the five-year production average. Add to that Robert Mugabe's government has virtually zero reserves to but corn on the open market.
The official annual rate of inflation, measured by the Central Statistical Office, reached 2,200 percent in March 2007 – a 470 point increase from the February 2007 annual rate.
These dystopian societies give us an early preview of what peak oil will mean as depletion creeps into more prosperous countries.
Into the gorge we go!
That's barrels of oil equivalent per capita with a modest decline rate in energy production starting next year and UN projections for world population growth (about 1%)
Charts like this are what make me realize that we are doomed.
200 yrs from now no one will believe we lived like this.
The Ancient Egyptians were able to have a self-sustaining culture for 3000yrs and we have just lasted 200 and we are going to wreck the world. Sad.
It boggles the mind doesn't it?
I made that chart just because I just couldn't comprehend The Olduvai theory. How in the world could as we know it end practically overnight?!?
Turns out you don't need to change a thing. Just keep on going like we've always done and it'll happen naturally.
The end of industrial civilization in 25 years. No global thermal nuclear war required.
Of course I doubt we'll let it play out naturally. We won't go quietly into the night.
Wait till I get the pre 1965 data. Then the transient pulse nature of industrialized civilization will be shockingly apparent.
Hubbert testified about the transient nature of fossil fuel based civilization decades ago before Congress. He rightly noted that we must use this wealth now to logically transition to a nuclear or solar based energy system. And we can! We have the technology right now, today, in our hands.
But it's not the technology that is the real problem. The real problem is that intelligent, prolifically breeding, tool using monkey called homo sapiens.
Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett
Do you have pre 1965 data ? I looked for them and could't find them. I know Duncan used the ones he found in a book written by Romer, but I don't find it.
If you find them, I would be please to get them.
I'm working on it.
I know the Romer book that Duncan used. I'm trying to get my hands on a copy but its pretty difficult as I live in Japan.
In a turn of good luck I think I can get a hold of a copy next week.
So hopefully I'll have the data soon. Drop me an email an I'll be happy to share.
You can always use this to find a library with a copy nearby.
http://www.worldcatlibraries.org/oclc/11233826&tab=holdings?loc=#tabs
No question, how many years does it take - before some future tribesmen can witness the worlds largest domino take place on Manhattan ?
And how many years can the skyscrapers sustain on a low energy diet with regards to maintenance - or rather lack of the same?
Manhattan is a spectacular place - but is building of such structures smart anymore..... Given what we, at least we here at TOD knows?
The pyramids are still standing and holding its overall shape - BUT they are massive natural stoneworks -
Their tilings are long gone and the natural stones are crumbling at their edges - skyscrapers are hollow stuff !
BTW - the UAE and other Gulfstates are constructing 'supersonic' infrastructures bound for the future like the worlds tallest building(1km ..?), enormous reclaimed islands (the world/the palm/more), whats next ? - And the sheiks brag on their own behalf .....
How many years ...... till they ...... only sand .....?
( inspired by Bob Dylan )
Saudi saying :
My father rode a camel, I drive a car, my son is a jet-pilot AND his son will ride a camel ....
This saying never progressed into the UAE ... it seems.
)
A great editorial by Frank Zarb from the Ford administration (Assistant for Energy Affairs). Many of Ford's proposals would seem truly radical today. Assuring a price increase in fuels for 15-20 years to eliminate uncertainty in infrastructure investing.
Regards,
AndyB
http://www.nytimes.com/2007/05/23/opinion/23zarb.html?pagewanted=1
A key point in the NYT editorial was that, absent a crisis, the federal government can't possibly organize itself into action on energy conservation/reducing foreign oil dependence. I agree that a gas tax is one of the single most practical short term low-hanging fruit opportunities to really reduce consumption in the U.S.
But how do you explain to people that the solution to the problem of $4.00 gas is $4.50 gas?
You try...something no one seems capable of at this point.
The third party candidate anderson proposed higher taxes as gas prices were rising... he lost. (IMO other politicians took careful notice.) Cartoonists had a field day, though.
I remember that guy: "We've got to sacrifice!" He and Carter and Jerry Brown were well aware of US peak and sought to mitigate the effects.
When Brown was Governor of California, he installed the 'radical' Adriana Gianturco into the Dept. of Transportation in 1976. Brown and Gianturco cancelled several pending highway projects, put large sums into public transportation, instituted Diamond lanes on freeways for cars carrying two or more passengers, pushed for a high-speed bullet train. The press/public hated her for the inconviences.
By 1983, when the US ignored domestic peak and went with petroleum importation instead of domestic peak mitigation, she was toast, bullet trains were toast, public transportation projects were toast and highway construction went back to Happy Motoring Utopianism.
I wonder what ever happened to Anderson?
I think that 1980 will go down in history as the year when the US came to a fork in the road and took the wrong path. The pathway looked better to a lot of people for a while, but we are now just beginning to realize what a disasterous route it is turning out to be.
Damn I was thinking my birth was the only significant event in the 80's....:)
Problem is there's a whole slew of people who DO believe that from the 80's.
I wonder what ever happened to Anderson?
-- Apparently still alive and kicking, at age 85:
http://en.wikipedia.org/wiki/John_B._Anderson
| The problem will solve itself.
| But not in a nice way.
Hey, younger than Reagan was in 1986.
Let's draft him for 2008!
Sorry - I was off by ten years on Reagan's age. He just seemed to have been born in the 19th century to me.
No, 18th century. He did say that Thomas Jefferson was a friend of his.
Kenny: The same politicians that are upset about high US gasoline prices propose that China revalue the Yuan up by 40%. Should be real helpful for crude prices.
The problem isn't "explaining it to the motorists". They can understand it. And don't tell me the Congress gives a damn about the average motorist.
The problem is the political class - the bankers, the developers, the industries that depend on cheap energy. That's the roadblock - the business-as-usual people. That political class does, however, include the politicians; energy shortages are so far out of their context, I'd not be surprised to see them legislate more oil.
cfm in Gray, ME
For those interested, The Gonzales investigation continues today with Monica G. testifying under immunity at 10:30 (or so) EDT on CSpan via the internet, don't know about Cable/satellite.
FYI Gonzales left on trip out of town yesterday. Out of the country out of town for several days.
cspan.org. on main page is a link at the top left to television schedule. click that and find the listing on the right network, Cspan 1 2 3
as usual the link on the site didn't lead me to the hearing.
here is the link
http://www.c-span.org/watch/cs_cspan3_rm.asp?Cat=TV&Code=CS3
Quid Clarius Astris
Ubi Bene ibi patria
The inventory report is out. As I wrote in my blog:
There was a decent build of gasoline, but not nearly enough to avoid a record low for Memorial Day weekend next week. The required build over 2 weeks is 5.5 million barrels of gasoline, and the actual build this week was 1.5 million barrels. Gasoline imports were still strong, but surprisingly down from last week. The big story was refinery utilization, which climbed to 91.1 percent.
I would also point out that crude imports continue to be very robust, and run ahead of last year's levels.
Although the increase in gasoline stocks this week was very much as analysts forecast, I'd say this is a slightly worrying report. Refinery utilization climbed much more than anticipated, but that didn't lead to a larger stock build than you might expect because imports were significantly lower than last week.
Certainly against my expectations, average 4-week gasoline demand growth turned up again, from 1.0% last week to 1.2% this week. Record high prices don't seem to be curtailing demand, and therefore later in the summer prices may well have to rise even higher. Also, it's hard to see prices coming down by much with demand still so strong.
Region-wise, gasoline stocks in all PADD districts rose except for the Midwest, where inventories fell by 0.3 million barrels.
[These are weekly estimates, subject to revision. Data source - EIA. Week ending dates are for 2007 (2006 is a day more). Capacity is utilization% of fully operable. Imports, production and demand are million barrels per day. Stocks are millions of barrels]
[Source: EIA. 5-yr average is the average inventory level at the end of May]
It looks like the story is still non-West Coast stocks, which are currently about 1.3 mb below the 4/13 level, versus a historical increase.
I would expect to see more reports about spot shortages, especially in the Midwest.
I just filled up at a BP for $3.29 a gallon here in Louisville, KY. A Chevron down the road had it for $3.49. It's averaged over $3.30 a gollan for almost a week now. Looking at PADD II inventory levels, I think I got a bargain.
Just talked to the owner of our local BP station (corvallis,OR) as I filled up and he said;
Price down this month from $3.39 to $3.29
demand up from 70K gal sold in march
80k in april
95k already in may
was down to 7k of reg and waiting on late delivery.
From a Times of London story on the US:
"Mastercard saw the number of transactions using its cards rise by nearly 20% in the first quarter of 2007."
We're getting ever more anxious about the future.
So we jump in the car and drive around and run up more debt!
Flyin' steady at $3.39 at the Omaha BP this evening. Premium now $3.59, up from $3.49 last week.
Filled up on regular for 2.99 in Pittsburgh on the weekend.
Everywhere else was 3.05 , 3.09, or more. that gas station
was 3.09 yesterday too.
It's up to $3.64 in my burb of Chicago. The city itself is up to almost $4.00. It's hurting the transit agencies too. Most of the commuter trains around here are Diesels.
"No man who owns his own house and lot can be a Communist. He has too much to do." (Bill Levitt - 1948)
With output at 9.2 Mbpd and imports at 1.3 Mbpd and a build of only 1.5Mb demand for the week was just colossal, huh? It brought a 4 week average up to 9.36 Mbpd.
Price for unleaded is up 11.5 cents to $321.8 and the Midwest is up 57 cents from last year. MOL PADD 2 is said
In this report
to be 47Mb. Since the're falling away from that (46.36mmb to 46.07 mmb) there is no where for gasoline to go in the Midwest but up or out.
Two things that occur to me looking at those charts;
1) Should we be worried that refinery capacity is 1.4% ahead of last year yet production is flat YoY?
2) This week it seems that the Gulf Coast gets the big increase stocks wise. Last week was the West Coast. Both are areas where tankers full of imports land. Is the stock build blips we're seeing a result of tankers full of imports showing up? If so is it worrying that the arrivial of a single(?) tanker can make such an impact or is this situation normal?
Should we be worried that refinery capacity is 1.4% ahead of last year yet production is flat YoY?
This is likely due to the import figures. Imports comprise finished gasloline and also blending components, and most of the latter go to the refineries where they ultimately get included in the production number. Last year's high imports of blending components meant that refineries could push out as much product as this year, even though utilization was lower.
2006 imports consisted of 0.52 million barrels finished gasoline and 1.10 blending components. This year the split is 0.60/0.69.
so because of lower imports of blending components the refinieries have to run at a higher capacity (presumably making up those lose components themselves?) in order to produce the same amount of end product?
Which means that when the refineries hit the ~94% mark they won't be able to produce as much as last year thus putting more demands on imports?
Refinery utilization climbed much more than anticipated...
I should have seen that one coming. I know that imports are scrambling to take advantage of these prices, but you can also bet that anyone who has a refinery down is scrambling to get it back up. I am sure people are working round the clock, seven days a week to get these maintenance issus sorted. There had been some stories about refinery problems last week, but that's probably just the media reporting every refinery problem in the country that may be routine, but right now it's a story.
This is where those people who think refiners are purposely holding back capacity don't have a clue. Nobody is going to hold back capacity in this market.
This is where those people who think refiners are purposely holding back capacity don't have a clue. Nobody is going to hold back capacity in this market.
Been seeing that too. Same people are wanting to sue Saudi Arabia and the like. Time 'We the People' realized that cheap fuel is just not our birthright.
We have met the enemy and it is us.
Nobody is obliged to sell anything to anybody ... unless forced to!
Maybe the government think KSA is restricting supplies of crude ... KSA is one side of the Gulf of Hormuz ... Iran is the other ... people assume that three carrier groups in the Gulf is to intimidate Iran ... maybe it’s KSA as well? ... or even not Iran at all?
Xeroid.
This is what I was asking about in that conference call with API. The refiners just cannot do it; one cannot run at 110% in the real world and keep it up.
cfm in Gray, ME
Captain, I'm givin' 'er all she's got ... she can't take it much longer ...
| The problem will solve itself.
| But not in a nice way.
Sweet!
Thanks FTX. Always a great chart, and the PADD addition is even better. Does anyone know of any similar info for Canada?
With imports dropping from last week, I guess these prices are still pretty low on the global market to haul away too much from others.
I think Europe is electing (with their wallets) to keep their gasoline inventories higher, instead of selling more to the US. (Speculation but likely)
This should have been the peak week for imports from 2006, we are off (1.63-1.3)*7 = 2.31 million barrels of imports.
How high can the utilization go?
How high can the utilization go?
The utilization number can be a bit misleading, because capacity increases over time. So, if inputs were constant, utilization would drop as capacity expands.
So, let's look at refinery inputs. The all time record still stands at 16.5 million barrels per day on 7/1/05. This week's number was 15.7 million, and was the highest level seen since last September. Looking back, it looks like we have only crossed the 16 million barrel mark twice since Katrina.
Utilization during that record week in July 2005 was 98.1. Post-Katrina, it looks like we have never reached 94%. Gasoline production, however, is running at all time high levels due to the import of blending components and the counting of them as finished production.
Ethanol is also making a contribution, but I would have to check to see if it's enough yet to explain much of the difference. Well, I just checked. Ethanol production is running somewhere between 300,000 and 400,000 barrels a day. On a BTU equivalent basis, that adds around 2 or 3% to the gasoline supply. On a net basis, almost nothing.
How high can the utilization go?
I haven't got a clue, but here's the reaction of one trader after seeing that strong demand number:
I said yesterday that the demand figure was the one to watch. If the rate of demand growth had fallen once again then I reckon the feeling would have been that max summer demand could be met without a big drawdown of stocks, and the gradual build in stocks we're currently seeing would be enough. But the American motorist just doesn't seem to want to stop driving, whatever the cost.
Another quote from the same piece:
Stuart Staniford linked to some research on James Hamilton's blog yesterday which showed just how inelastic gasoline demand is in the short term. The last few weeks have certainly borne that out.
So should I buy sept gasoline futures or what??
In my opinion, no. The situation is very likely to stabilize and settle before then. If you wanted to play against July you might but the main variable here is unplanned disruptions. One hurricane or unplanned refinery outage after Memorial Day and we've got problems. If there are no unplanned issues, then we may muddle through just fine this summer.
Ghawar Is Dying
The greatest shortcoming of the human race is our inability to understand the exponential function. - Dr. Albert Bartlett
Korg, if you are a certified, trained professional psychic go right ahead.Hurricane season peaks in the August/September period, so if you bet on a hurricane gas futures could be great. But remember its gambling, and you aren't the house who always wins.
Colonial Pipeline has put customers in NE on allocation.THings will be tight this weekend!
I have been wondering how long large gasoline imports can be sustained given the IEA's dire warnings about inadequate supplies so far this year and diminishing inventories around the world (not including US crude). Either oil supply has been rising more than we know to supply international refineries or it would seem we would hit the wall at some point.
Oil prices fall amid growing supplies
Wow! MSNBC interprets the news as a reason for falling prices. Later in the story they comment how the price in London futures for Brent slid 3 cents and Gasoline futures plummeted 2.2 cents. Darn I knew I should have shorted this stuff!
According to EIA numbers refinery utilization in 2007 (thru 5/18) is 5.5% below the average for the last ten years.
12.3% Chance of Hurricane Force Winds in Orleans Parish
See Map in article
http://blog.nola.com/times-picayune/2007/05/active_hurricane_season_fore...
Best Hopes (7 chances out of 8) for nothing more than mild summer breezes in 2007,
Alan
http://www.redding.com/news/2007/may/22/jones-valley-residents-consider-...
"A public meeting today at the Jones Valley Fire Hall will focus on the costs of . . waterlines . . . through a pair of subdivisions, said Pat Minturn, Shasta County's public works director."
"He said he expects the cost for each property owner to get reliable water to be around $50,000."
"But that figure could be cut in half, thanks to grants, Minturn said."
Generally, I don't believe in the death of suburbia. There are too many sunk costs in infrastructure to abandon it and start over. However ... here is an isolated area that is planning to ask for federal and state grants to defray the $50,000 per household cost to obtain dependable water supplies. Shopping, schools and doctors are beyond the range of an electric assist bicycle. Plus, hundreds of homes in this area have been destroyed by wildfires in the past 10 years. It would be a big waste of money to spend taxpayer dollars there.
"Believe" as you will. This is what Kunstler talks about as throwing good money after bad - he has a much more descriptive way with words, though, but I cannot recall the phrase he uses.
But you are right there are huge sunk investments. Getting the right paradigm and moving directly to it, rather than ratcheting down step by step and each step trying to maintain status quo - that's what worries me. The decline will be grossly expensive unless we jump directly to the right level of energy use. John Howe thinks it's about 1/8 of what we use now IF we redirect what we have now into sane renewables. How we powerdown matters a lot.
Fat chance.
cfm in Gray, ME
SF: American suburbia will not suddenly become abandoned. However, 2007 might mark the beginning of the end of suburban sprawl development. USA population will continue to increase, probably quite dramatically through increased immigration but future RE development will be urban, IMHO.
I've always wondered what it would look like if FEMA and private property insurance payments after major disasters were premised on simply buying out the property owner and not allowing it to be rebuilt. Over time wouldn't it remove from the path of destruction those buildings that have proven themselves to be in said pathways?
Rule no. 1: Don't fight nuns. When in groups, they're nasty critters.
More Exxon shareholder trouble:
Investors take ExxonMobil board to task over climate change, renewable energy
Dennis K. gave his speech today, on at the same time as the hearings. Its all about oil, and Iraq.
He's stating names of oil company execs standing by before (long) to start the process of Oil companies to take over the oil fields. Much more than that and timeline of the agreement etc.
The transcript and perhaps a replay may be up later today.
Quid Clarius Astris
Ubi Bene ibi patria
I'd much rather see the unelectable 'clowns' Kucinich and Ron Paul get the presidential nominations than the popular K-Street servants which are favored to win such as Obama and Giuliani.
The execs know Iraq will never be stabilized. The Iraqi oil workers union would rather blow the facilities up before handing them over to Bush-colored people.
But all they have to do is sign agreements, and then they can claim those fields as reserves to potential investors.
Does it matter to them that they will never get the oil out?
An "any one seen this?" kind of question.
I am looking for a US state by state inventory of current alternative energy generation and potentialities.
Then I'd like to mash that with general stats like % arable land, consumption numbers, etc., and political partisanship and party delegation numbers.
anyone seen anything out there like that? If not, I am going to start compiling, but I wanted to come to the brain trust that was TOD first.
AWEA has a state by state listing of wind potential (using obsolete technology, but still good from a relative POV).
ORNL.gov has some state by state #s (carbon emissions, perhaps others).
USGS has some hydro #s.
Quick off-the-top-of-my-head response.
Alan
I'll see what I can put together for Florida. On Monday, I attended the Century Commission meeting on P-Cola Beach. Dr. Stephen Mulkey presented some material on alternative energy including biomass, cellulosic ethanol, and bio-digesters. Some of the members were very excited about the prospects for pig poop! This will be a good excuse for a follow-up email to him.
Also, I'm going to a June 7 meeting whereat the local county government (Santa Rosa) will be specifically addressing those issues. I'm riding over with the technical expert in biomass from a local university.
Ed
Dear Prof:
You may want to think about available surface area for solar on a state by state basis (at least in the southwest). Using the "1 cubic mile" of oil post, I noticed that it said that a year's global oil supply was the equivalent of 91,250,000 installations of 2.1KW solar panels for 50 years. So I did the math. One installation is 10 separate 208 watt panels of 5.4' x 3.26' or 17.59 sq ft each. Therefore one cubic mile of oil is:
IMO solar will be down nearly 10x to $.5/w, by 2010.
I earlier thought that fields of cheap solar panels would grow in southwest deserts, but now think early use will be rooftop because 34 states force utilities to allow solar collectors to feed the grid when homeowners do not need the power, and then crediting the owner w for w... in CA we have been paying .14/kwhr for 30 years, so the 'worth' of rooftop collectors is high. Early use will help displace ng generated peak power. All of this could be combined with smart meters that charge based on the utilities actual costs, varying the price every hour, and potentially shifting demand from fossil to nukes. Just 500 nukes would replace the 100 existing older nukes plus all coal burners, say a modest 2/month over 20 years...
Ahaaaa Ahaaaaa ROTFLMAO Oh my God thats funny..
Just 500 nukes!! Only 500??? Well hot damn maybe Ford and GM can roll them off the assembly lines...
If this country build 10 nukes in the next 20 years I will be shocked!!
And...there isn't enough high-grade silicon in the world to produce the amount of panels you are talkin about. Jesus Christ dude, the industry is runnin full out now. Where are the millions of panels comin from????
We are on the fast track to HELL pal.
Let me give you an example: Near my house they are building a 790 MW Natural gas fired power plant. Its fuckin huge! Well it was supposed to be done last year but NOOOO....the previous GC got fired because the piping was AFU and the BIG guys from GE had to come from NYC to fire 'em..now the people ther are hoping it might be done in another yeaar or so. IF we can't even buil a relativly simple NG power plant how are we going to build 500 NUKES?!?!?!? Our construction and engineering guys aren't as smart as they used to be...
Also my keyboard is aafu....
IMHO, the USA could ramp up to completing 4 new nukes/year (our previous record) in 20 years at reasonable cost (i.e. commercial urgency premium as we see today in Canadian tar sands).
Best Hopes,
Alan
JK;
Believe me, I think PV is going to be a crucial component to our future energy mix. I don't think it'll necessarily be a huge percentage of overall supply, but it is a damned useful technology, keyholing into electricity, an immensely flexible power source. Long-lived, portable, scalable in application from Desk-Calc's to multi-megawatt rooftop arrays without much complication at either end..
That said, no matter what they develop as far as improvements to the watts per sq meter, or watts per oz of Silicon, etc.. the demand and the usefulness of this source will dictate the price. I truly doubt it will be going down, leastways by much. Add to that the minimal chance that supply will ever catch up with or exceed demand, and you've got your price graph right there.
Like Clairol. "Sure It's Expensive. But I'm worth it!"
Bob Fiske
Solar prices have actually been going up over the last few years, according to SolarBuzz. But aren't we or shouldn't we be in a state of emergency. We should be seeing a government directed massive shift of resources to silicon wafer production . Did we let the free market dictate our needs in World War II. I know it has become tiring and trite to label every problem a war. But we need something dramatic to crank up silicon production. In the mean time, companies like MEMC have been great investments and should continue to be for the foreseeable future.
Prof G,
Try this one for State of Iowa http://www.extension.iastate.edu/Publications/IAN106.pdf
If not what you are looking for ISU should have it somewhere. They have put together wind maps and solar maps for every county at a seperate site in order to guide installation. The ISU economists are also on the forefront of tracking capacity for biodiesel and ethanol.
Somewhere they will have total capacity as a percentage of usage for the state.
A few sources...
NREL Maps
http://www.nrel.gov/gis/maps.html
Wind:
State Wind Resource Maps
http://www.eere.energy.gov/windandhydro/windpoweringamerica/wind_maps.asp
Biomass:
Milbrandt, Anelia, 2005: "A Geographic Perspective on the Current Biomass Resource Availability in the United States", National Renewable Energy Laboratory, Golden, CO.
http://www.nrel.gov/docs/fy06osti/39181.pdf
Renewable Energy Strategy:
American Solar Energy Society
http://www.ases.org/climatechange/
Prof. David J.C. MacKay; Department of Physics, Cambridge has been working on a book on sustainable energy. The book follows a scorecard approach on consumption vs. potential renewable source.
There is a rough draft and a lot of reference url's here:
http://www.withouthotair.com/
It's UK based but I found even the draft worth reading and it's similar to the inventory concept you are describing.
Plateau Update
I was feeling a bit impatient waiting for Stuart's latest plateau update so I did some of my own investigation.
The following are plots of changes in production of All Liquids and Crude+Condensate using EIA data available from here (t14 and t11d) :
http://www.eia.doe.gov/ipm/supply.html
I've plotted non-OPEC, OPEC-11 and World production as changes from January 2001 so all three will fit conveniently on the same plot.
Production of crude and condensate from the non-OPEC nations is still increasing. The current plateau is due to a decrease in production from the OPEC-11 nations. (Note: Angola and Iraq, not being subject to OPEC quotas, are not included in this group.)
Texas Railroad Commission Announces That Overall Texas Decline Does Not Matter, Because of Increasing Production by certain Geologists and Operators
News Release Follows:
Actually, the "Plateau" in world crude + condensate production, through 5/07, has probably resulted in the world producing about 500 mb less crude oil than if we had just maintained the 5/05 production rate.
Because of the "plateau" in world crude oil production, the average monthly Brent crude oil price since 5/05 has traded between $54 and $74, versus $38 in the 20 months prior to 5/05.
I wonder what effect a "Decline" in world crude oil production would have on prices?
I for one do not find it plausible that a cartel of oil producers which has a history of constraining production to suppport prices would reach peak before those with unconstrained production.
It's entirely possible. It all depends on what they had to begin with. And all we have are guesstimates...
When was the last time the world showed sustained lower crude oil production versus rising oil prices?
We have seen it on a regional basis, e.g., the Lower 48 in the Seventies, but worldwide?
Of course, there is Deffeyes' observation that the world, in 2006, was at about the same stage of depletion that the Lower 48 started declining in 1971.
The cartel has been producing for a long time, the super giants for half a century. Non opec areas showing good growth are entirely those off limits for either political or technical reasons, eg kazakhstan and other stans in the first case, ultra deep off shore brazil/angola in the second. Both cupboards are now pretty much fully exploited, and meanwhile the rest of non opec, under production for a longer time, is going down.
Regarding constrained production, non-sa opec production has only rarely constrained itself, this has always been more sa than the rest. And ghawar is going down... SA will produce for years, but never again imo at 9Mb/d...
There are no more ghawars, no matter than kuwait is claiming one and fools look hopefully at western iraq.
Here's an article by John Stossen titled "The Many Myths of Ethanol":
http://www.jewishworldreview.com/0507/stossel052207.php3
My weekly column —
Unhappy Motoring
At a time like this, I try to remember what the sage Yogi Berra might say about gasoline demand, prices and inventories.
This is like deja vu all over again
You can observe a lot just by watching
If you don't know where you are going, you will wind up somewhere else
A nickel isn't worth a dime today
Slump? I ain't in no slump. I just ain't hitting
best regards, Dave
Well we all saw this coming:
House OKs penalty for gas price gouging
http://news.yahoo.com/s/ap/20070523/ap_on_go_co/gasoline_prices_congress...
Did I read the headline right?
America is sueing OPEC. WTF?
The focus of the headline is that Russia is up in arms!!
Surely thats like looking at the ass of the incontinent donkey and saying "it's teeth need brushed".
Welcome to the Monkey House.
House passed a bill basically stating that OPEC is manipulating prices of oil by restricting their output. Looks like the wagon is getting in front of the horse....anyone wanna make some bets?
Maybe someone should remind the US Congress that it was an official organ of the great state of Texas that served as a model for OPEC.
In 1979 there was a revolution in Iran and gasoline inventories around the world were close to exhausted. President Carter instituted price controls and this led to drivers lining up around the block to get gas, people took newspapers to read as the wait was quite long. They were filling up five gallon plastic containers full of gas in addition to their tanks for fear they might be cut off. As price controls did not work, they were lifted.
http://en.wikipedia.org/wiki/1979_energy_crisis
Recent EPA regulations for low sulphur fuels required enormous investments for refineries. Fuels made in other countries might not be the same high quality fuel and cannot be sold in the US by Federal law.
The law to use ethanol seemed fine when ethanol used to be cheap. Now that it is required for the summer formulation of gasoline it costs alot more. Last summer drivers were shocked when their 90/10 gasoline cost more than the winter formulation. There is not enough ethanol in the world to satisfy demand. The cost of ethanol alone rose to $4.00 a gallon last summer. This year the price of corn is higher and the price of gas might rise again. This is due to legislated mandate. Now that they are planting more corn and fewer soybeans, what happens to the price of soybeans? Then some farmers find soybeans higher in price they want to plant less corn, the price of corn goes up even higher, each year they have to decide to plant corn or soybeans.
Refinery capacity was being added around the world, but not as fast as demand for gasoline and diesel was rising. Since many have advised the official OPEC reserve data was suspect of being fabricated and the world is near peak production of conventional oil + NGL's, soon it might be lack of oil that drives the price up and refinery capacity will be ample. Oil shale and tar sands profits are not high enough to allow for production there to rise fast enough. There are shortages of skilled boilermakers, pipefitters/welders, etc in the Canadian Athabasca Field. The price of nickle went up more than 300% in the past five years. The price of uranium for energy went up 1600% in the past five years. Offshore drilling rates went to $200,000 a day with companies booking rigs for up to four years at a time and rigs scheduled to be built by shipyards are already reserved for work into the next decade.
If the US puts price controls on oil, OPEC will sell it elsewhere. Like Venezuela was being enticed by China for more oil and US corporate customers fear being left out of the equation. If the US gives tax credits for refinery expansions some will use them. There are new projects on the books without tax credits. This will not solve the problem of the world facing the day when conventional oil production + NGL's will peak and the world will have to turn to synthetic fuel and alternate energy sources to meet growing demand or do without.
Memorial Day is coming and some will be heading to the beach. Europeans and others have been paying much higher prices than the US for years and yet there were traffic jams on Monday morning. They learned to chose cars with better than 40 MPG and have not the pain of driving a 20 mpg vehicle.
Question:
Are imported gasoline and blending components traded in US Dollars? Or when ordering a tanker full of gasoline from a European refinery is the order priced in Euros?
It's priced in Euro's based on an exchange value of the dollar/euro. The basis is still dollars though which is where the whole petrodollar hedgemony argument is based.
Thanks for the reply, but I'm still confused.
In order to get the gasoline loaded onto that tanker and sent to the Gulf, we need to outbid UK drivers for the petrol.
I'm wondering if, as the dollar falls against the Euro (or the Pound, in this case), whether that increases the price. Your comment that "the basis is still dollars" implies that we in the US are protected from a falling dollar in gasoline imports as well as crude imports.
The same number of US dollars would buy fewer Euros (or Pounds), which translates to a competitive disadvantage to the European (or UK) driver who wants to purchase that same petrol. Or am I just completely off-base here?
International trade in oil is in US dollars..... If the dollar is weaker against another currency such as the GBP or Euro, it means the country whose currency is not USD can buy more dollars than previously with the same GBP or whatever...so the US is at a competitive disadvange. If a bbl of crude is $60 and the price rises to $66 but the dollar weakens by 10% against the GBP pound, the price of oil to an american has risen to $66 buck but the same amount of GBP's can buy $66 since the USD has lost 10% of its value... I hope that helps
Why is Greenspan still acting like he is the active Federal Reserve Chairman and why is he making these statements?
Greenspan Says China Stocks May Undergo `Dramatic Contraction'
http://www.bloomberg.com/apps/news?pid=20601087&sid=aKAZRfGA3TT8&refer=home
U.S. Stocks Fall, Led by Technology Companies; Intel Declines
http://www.bloomberg.com/apps/news?pid=20601087&sid=azi.rKYP3EPc&refer=home
A. Because he receives large speaking fees.
B. Because the people hiring him to speak do not want to hear his fishing stories.
I notice Greenspan actually mentioned Peak Oil (in the negative):
I suppose if he feels the need to address the question at all that's a step forward. Could have been in response to a leading question, of course.
If we are to believe in things we cannot see or touch, how do we tell the true belief from the false belief?
Ya...well...why do you think we are suing OPEC? They won't give us more oil when we DEMAND it at the price we WANT it.
You mean of course, they won't give us OUR oil when we demand it at the price we want it.
A couple of drumbeats ago there was a news article and discussion about Electricity Blackouts in India (& other places)
Below is a link from yahoo!news
http://in.biz.yahoo.com/070523/137/6g5ug.html
>>Studies show that in some Indian provinces, subsidies on power are much higher than primary health spending. Almost half the power generated is stolen before it reaches consumers. <<
IMO in most shortages are caused by politicians / systems distorting the functioning of the free market.
That's because the functioning of the free market sometimes left people without food, clothing or shelter. Their labor was not worth keeping them alive. So they turned to violence.
Revolution is the blackmail threat by which those people lived to starve another day. Most of the current value of your wages represents the growth in workers' incomes from 1932 to 1980. That was the generation that saw tent cities of broke war veterans in Washington DC attacked by tanks, and Republican farmers in Iowa forming mobs to ward off foreclosure men. The threat of such disorder is what brought the bosses to the bargaining table, redistributed wealth and made America a halfway-decent place to live for non-rich non-bigots. When the generation that remembered that threat died off, the bosses reasserted their power, and the natural polarization of private wealth resumed, except this time it was a giant global siphon.
So I dare you, subject people living on a buck a day to market pricing. Your holy market says they're worthless animals, but they can build bombs as deadly as any "entrepreneur".
chemE, the problem is that if you charge people what it costs to generate and transmit electricity, 70%-80% of the Indians won't be able to afford it. The theft is mostly by people who can't afford to pay the bills.
I don't know about that. Some of that is true but mostly the theft of electricity is by
(1) Senior civil servants running bypassing electricity meters
(2) Small business and manufacturing enterprises paying off the local meter reader
(3) The 100s of 1000s of current & retired employees of the Electricity Distribution companies
(4) Local criminal elements and those with connections to criminal elements - Meter readers do not dare to point out to these guys that the meter has been busted
(5) Senior and Junior politicians and party workers
(6) People in poor neighbourhoods who have illegally tapped distribution lines
(7) Farmers - legally (highly subsidized) and illegally tapping distribution lines
---
IMO in the current societal structure in India these problems are difficult to solve.
Distributed PV generation (for residential use) on every roof-top and balcony is the answer. And IMO it will be there in 5-10 years.
If I were back in India I would go off the grid. And yes it is technologically feasible to do so today.
Look at me! I'm a Big Oil apologist!
A Kind Word For Big Oil
"Federal, state and local communities extract more from your wallet than Big Oil every time you top off your car’s gas tank."
Well hell, spudw, the Federal government needs two hundred billion a year to terrorize Arabs into handing their resources over to Big Oil. The State government needs money to keep its National Guardsmen in Iraq instead of cleaning up disasters at home. And the local government must finance public schools to indoctrinate and monitor poor kids for eventual Army recruitment. Where's the bill to Big Oil for that? In fact, what's the bill for our military artificially keeping the corrupt Saud family in power and the swing producer in OPEC for two generations?
Now if Big Oil's all-time favorite president acted so brutally that much of the global oil patch is now off limits, that hurts you and me, but that doesn't seem to hurt Big Oil very much. My proof? If you asked an oil exec about a cut in federal gas taxes - TO BE OFFSET BY A CUT IN THE IRAQ WAR BUDGET - I bet he becomes uncharacteristically liberal in supporting the bloody status quo.
Cuba to modernize its ethanol production despite Castro opposition
Castro cares about the poor? I thought he was a ruthless, evil , commie dictator? Or perhaps he was just preparing his people for life after PO...
Well, to be fair Cuba grows sugar cane like Brazil, where ethanol production is clearly energy positive and less food-negative than using corn/maize in USA.
But of course Communist party commissars want to have easy transportation, ahem, to ensure their continued service to the revolution of course.
A sure cur(i)e for hunger?
Right now we have Korn (tasty fungal foodstuff); maybe someday we will also have Curin or Cesorn Salad? :-)
It is interesting that some organisms actually seem to like extra radiation in their environment.
Everybody,
You have to read this gem. I found it on the asahi-IHT site in Japan. (NYT associate)
So for all you mere mortals out there:
1) Demand for oil is not growing
2) China and India are not using more oil
So what caused the spike in oil price?
So there you have it. We must not be unduly alarmed.
The rest of the artice is pretty decent, though.
I love that part. Conservation will make Japan less dependent on foreign oil. Ha!
Japan has no domestic energy supplies so what good will conservation do? You'd just do more work per unit of energy. You would actually make Japan more vulnerable to supply disruptions.
Did he really say that?
"Japan has no domestic energy supplies so what good will conservation do?"
??????????????????????????????????????????????????????????????????????????????????????
So the less oil a nation has, the less it should try to conserve?
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
(gee, would importing less possbly save money? Gee, would learning the technology of alternatives or conservation possibly create an exportable commodity? Gee, would reducing the strain on the worlds oil supply possibly make the world (including your own customers nations) more stable?
Gee, would using less give you more options as to who you could purchase (and choose not to purchase from) allowing you at least some measure of political and geo-political self determination?
Gee, could using less make certain alternatives more viable (this is something the AMERICAN doomsters never understand by the way. That is, if you are driving vehicles that get 40 or 60 miles per gallon, then options become workable that simply will not work at 15 or 20 miles per gallon, due to the sheer volume of the liquid fuel required.)
Sheer beauty, the Toyota Hybrid Camry. In a very few years, the plug version of these and a few dozen other models will begin to mix into the fleet:
http://bp2.blogger.com/_HepvDGfL4lA/RkyQrRZfzII/AAAAAAAAAFg/WJ0Ty8zQZ6A/...
The batteries are getting better now by leaps and bounds. PhotoVoltaic electricty has already dropped in price by a factor of 10 per kilowatt output, and still dropping fast, even before the new generation of technology kicks in (completely refuting once more the "law of receding horizons", this has happened while crude oil prices have almost tripled, because oil imput is not a major factor in production of PV cells, and in fact is a decreasing percent factor, just as oil consumption is decreasing in all industrial production.
And the wise sages of America have one question: why conserve?
It's dizzying......
Japan should conserve for exactly the same reason we should. We are in a race against time. If we can buy ourselves another decade, "peak" becomes a non event. But we are on the edge. We waited far too long and now we are taking a terrible (and completely stupid and unnessacary, risking great damage and suffering) chance, proving our incompetence. We now must hope that the systems that make change possible can hold together long enough to get us through this crisis period. We did not have to take this chance. We have only ourselves to blame.
RC
Remember, we are only one cubic mile from freedom
The point the author was trying to make was that conservation would make Japan less suseptable to supply disruptions. When in fact it does the exact opposite.
Think about it Roger (yeah I know, I'm asking a lot of you).
If Japan does X units of work for Y units of oil input. Then they start a conservation progam so they do 5X units of work for that 1 Y unit of input. Now for every shortage of Y units of input they loose 5X units of work.
They are worse off for conserving.
The reason it makes sense for the US to conserve is because they have a large domestic supply of energy. Therefore the more effcient you get the more you can rely on domestic supplies (which are stable) and the less on foriegn supplies (which are unstable)
You comments as to reducing strain on world oil supplies are as asinine as usual. Every barrel of oil Japan doesn't import oil starved Africa would love to take and burn. Remember Senegal? They have 4 more days of diesel left before they go dark. The world is already supply constrained with oil. Conserving won't buy you another day let alone a decade.
And it doesn't really matter who they buy oil from since it is (for the most part) fungible.
I have no idea how using less oil would make alternative more viable. You're gonna have to explain that one to me. I fail to see how my car's milage will effect the EROEI of ethanol.
I disagree.
A more efficient Japan has more exports to pay for less oil that it needs. When the competition gets fierce for a limited quantity of oil, Japan will have more to sell per barrel of oil that it needs.
Japan has a good non-oil transportation system that, outside of Tokyo, can expand to replace much commuting and more freight can also take the non-oil route.
An interesting question is if Japan can function off of the ethanol it imports from Brazil.
Afterall, Switzerland got through a six year 100% oil embargo with ~10 months in storage. By 1945, the average Swiss used less oil that year than the average American uses in a day.
Best Hopes for Non-Oil Transportation,
alan
I don't understand what you are saying. Japan could better aford to buy oil if they conserve?
Maybe, but they'd be just as dependent on foriegn oil as before. They would still have to import 100% of their oil no matter how effecient they are.
I've traveled around Japan quite a bit. My experience has been outside of Tokyo there is almost no non-oil transportation. The population density outside of Tokyo or Osaka is far too low to support rail. Everyone drives everywhere. Very much like America (but with smaller cars). Even Kyoto, a large city, has a dismal rail system compared to Tokyo.
Even if they could, so what? They would still be importing 100% of their energy. Just now they'd be importing from Brazil instead of SA. It won't change their dependence on foriegn energy supplies one bit.
From WSJ yesterday (pain to format). I don't know what to make of it.
TOKYO (Dow Jones)--Japan's imports of crude oil and condensate in April fell 16.4% on year to 19.6 million kiloliters, the Ministry of Finance said Thursday.
The yen-denominated value of the customs-cleared crude and condensate import bill in the same month decreased 16.6% on year to Y884.4 billion, the MOF said.
Japan's April 2007 energy imports and percentage change from April 2006:
Everything except LNG is down pretty big. What gives?
Japan has for the last couple of years been reducing the amount of oil it uses.
I think this is because of 2 main reasons: demographics and manufacturing. (but I'm no expert so take this with a grain of salt)
Recently a lot of manufacturing has been off shored to China so they are bearing the energy responsibilities for Japan in that regard.
Demographics are three parts. One, the population as a whole is shrinking in Japan. Two the population of Tokyo is increasing (the population is shifting from the countryside to Tokyo where you don't have to drive or heat your home). Third is the population is getting very old very quickly and old people just don't use as much energy.
I'm not surprised to see NG buck the trend. Japan has an insatiable thirst for that stuff.
Can you include a link to the WSJ article? I haven't seen it. Strange that they would have newer numbers than the PAJ
That's basically the whole news release, but here is a link
Japan April Crude Import Volume -16.4% On Yr
Offshoring manufacturing to China makes sense.
W: Pretty amazing number. Might explain why crude prices are softer than one would expect (looking at global production numbers). Also, it illustrates how much oil usage can be cut without dropping into recession if urbanization picks up (is promoted).
The higher the ratio of total exports to oil, the more Japan (or anyone else) can afford to bid for limited oil. If Japan were able to cut their oil consumption in half, they could (in a macro economic sense) effortlessly be able to pay twice as much/barrel. And paying four times as much/barrel would be less of a shock.
With a 50% cut in oil consumption, paying even 1000% more is probably doable without severe economic disruption.
Brazil is unlikely to deplete it's ethanol production, so a long term trade relationship with Japan would be more secure than depending upon KSA et al for oil imports.
The Shinkansen is justly famous, and widespread
http://www.jreast.co.jp/e/charge/index.asp
Other, almost all electric, rail lines go into every part if Japan.
Japan built the world's longest tunnel between Honshu and Hokkaido for rail.
Picking a random medium size city, Sapporo (population 2,016,000) has a decent subway system.
http://www.zone81.com/arch_sections/trains/sapporo_subway
Nagoya (pop 3,157.000)
http://www.zone81.com/arch_sections/trains/nagoya_subway
Fukuoka (pop 1.4 million)
http://www.zone81.com/arch_sections/trains/fukuoka_subway (a 3rd line under construction)
Yes, Japanese drive quite a bit, but there are alternatives for many trips, and those alternatives can be expanded in a timely manner given the existing infrastructure.
I noted with interest the 16% decline in oil imports. Much of that is probably statistical variation, but it also must reflect some real conservation.
Best Hopes for Japan,,
Alan
I understand what you are saying now. But you are getting into economics now and subsequently way over my head. Conservation won't lessen Japan's dependence of foriegn oil, but it will allow them to outbid other nations more easily.
You are very correct about the shinkansen. Japanese inter city rail is excellent to say the least. I was thinking commuter rail. The shinkansen is great but limited. Its only good for trips of about 3 hours or less (Tokyo to Osaka for example) after that flying is much faster and cheaper. There is a huge domestic airline industry here. And once you get off the shinkansen your rail options can be very limited.
Those cities you listed do have rail systems. But than again every city over 1000 people in Japan has at least 1 rail link.
Its really amazing and extremely creepy. For example I was up in Gunma prefecture recently, took the shinkansen there as a matter of fact. But once I got off the main line everybody drove everywhere. I walked from where I was staying to a local convience store in search of beer. The little old lady there informed me her store doesn't have it but the next town up the road does. It was only 2-3 Km away but she was floored that I was going to walk up the road to the next town. She thought I was mentally ill or something. As a matter of fact there was a train line that paralleled the road. The train was only 2 cars long, completely empty and only ran 2 times a day. The train stations I walked past looked abandoned. Nobody rides the train, they all drive all the time.
I notice a similar pattern every time I get outside of Tokyo. There is rail everywhere but it is almost useless if not completely useless. Intercity rail excluded.
The subways you listed above are really pitiful even by US standards. The only place commuter rail works well is in greater Tokyo, but that only makes up about 25% of the population.
BTW that honshu hokkaido tunnel was a complete boondogle. Its the Japanese engineering equivalent of NO levees. It leaks constantly and without constant pumping would completely flooded.
Its also completely underutilized as no one in their right mind takes the shinkansen to hokaido anymore. Air is so much better.
Have you ever been to Japan? Because I live here and this is not the impression I get at all.
I wrote above as to what I believe the causes are. Demographics and offshoring of manufacturing. In general there hasn't been much conservation in Japan since the early 80's.
http://www.eia.doe.gov/pub/international/iealf/tablee1c.xls
If Japan does...5X units of work for that 1 Y unit of input. Now for every shortage of Y units of input they loose 5X units of work. They are worse off for conserving.
Like Alan, I disagree with this too. It's a matter of composing the correct economic equation. You are correct as long as the conservation is spread *perfectly* across all economic activity. But that's not how it works.
If you construct the equation as X1 units of work that are oil dependent and X2 units of work that are oil independent then the whole equation changes in favor of conservation.
Honest question.
Is X2 really significant? How much work gets done in any economy that isn't dependent of fossil fuels?
Somewhat philosophical answer. Since Peak Oil per global population happened about 30 years ago all subsequent economic activity has been increasingly oil independent. The X1 has been getting smaller and X2 has been getting bigger -- for over 30 years. If you weren't aware of this, then stop, and read over until it sinks in.
Less philosophical answer. The next stage is to attack X1 with a vengence. Personally I think that the technology to do this has *already been invented*. Hybrid cars and trucks are the first step. Next step, completely electric vehicles. Honestly, within about 5 years no one will question that oil will become increasingly useless.
Ok, bit of a misunderstanding here.
I was asking about all fossil fuels in general. Sure peak per capita OIL consumption was 30 years ago but peak per capita fossil fuel consumption is still rising.
I can easily see X1 getting smaller as X2 grows using coal and natural gas.
But I'm not sure that make a bit a difference in Japan's case as they have no domestic coal or NG. They have virtually no domestic supplies of energy at all (some nuke and a little hydro).
So all you are proposing is switching Japan's energy dependence from one finite fossil fuel to another finite fossil fuel. And they would still be completely dependent on energy imports.
The only time conservation makes sense is when you have a domestic supply of energy. Perhaps if Japan went on a nuke building spree to such an extent that combined with conservation they would be semi energy independent. But I can't see that ever happening considering the sorry state of the existing nuke program here. Not to mention that does nothing to solve the liquid fuel problem.
Well, we'll get Peak "Hydrocarbons" per global population in everything at some point. It's the same story. "Conservation" is just a word for dragging out timelines.
It'll probably all go to solar (and some wind) in the end. Perhaps CSP solar (don't ignore this), PV solar, waves, hydrogen enzymes, fission, fusion, Helium-3, nanotech, DMFCs, endless, etc, etc. You've got to prove that they are *all* void of promise (very hard to do). All the while, efficiency is improving.
DJ Newswires had 61 energy headlines today -- about average. Read PhysOrg, Technology Review, Green Car Congress, EV World, Renewable Energy Access, Cleantech, and so on.
Calculations using *just* CSP solar show prolific amounts of energy are available. This ain't over.
Well, maybe. But that's a whole nother argument.
But in the end without a significant source of domestic energy conservation won't help a nation survive an energy import crisis.
And without a significant source of energy to supply your X2 section of the economy, increasing efficiency on the X1 side of your economy only makes a nation more susceptible to world energy instability.
Well, then the solution is simple: lift all oil taxes, subsidize gasoline! Make SUV's mandatory! Punch a hole in every tank! The more we use, the less vulnerable we are for shortages..
If a country imports 100% of its energy, does conservation make them any less dependent on imported energy? Does it make them less suseptable to supply shortages?
First, I was going to jump back in and defend my own position, but as the string developed, I really didn't have to, in fact it would have been redundant.
But I am going to jump back in and say something that might surprise, and that is, now I understand better what rethin meant, I think.
And from a semantic viewpoint, rethin is correct....if I am 100% dependent on imports, I can by conservation reduce the volume of imports (which I took it rething was attacking the value of) but as rethin says, unless I can come up with alternatives, I will still be 100% dependent on imports, so I will not, as a percentage of consumption, managed to reduce my dependence on imported oil, but only reduced the volume of oil I import. Point well taken.
By the way, what I meant by my point that reducing consumption of oil making alternatives more viable: If I operate inefficient cars for instance, and get 20 miles per gallon, then X number of cars will consume as an example, 40 million gallons of gasoline per year (example only) But, if I can double the efficiency of said fleet, I can get by on 20 million gallons per year.
Suppose I attempted to use some of my nations waste stream, and recapture methane from sewer gas, agricultural waste and animal byproduct, landfill gas and wood processing by product. The volume of said waste product might (we don't know) make enough btu to equal 20 million gallons of gasoline per year.
But, we do know this: It would be harder to equal the BTU of 40 million gallons per year. So in other words, the sheer volume of BTU consumed should drop due to efficiency i.e. conservation, making more options possible.
Rethin is correct in using the ethanol example as a poor replacement, but that is because the consumption involved in ethanol production is so high.
Houses built to conserve can make better use of alternatives such as solar and ground coupled heat pumpts cars and trucks built to conserve can make more use of waste recapture and grid based energy, etc.
It is just damm hard to come up with a good argument against efficiency.
:-)
(I will do a seperate post on this involving individual consumption, because I have become more aware of how much better efficiency can mean in transportation in particular since the recent gasoline price run up and my own experience with an aging Diesel over the last few years!
Roger Conner
Remember we are only one cubic mile from freedom
Actually its very easy.
(contrived example) If a country imports energy (under long term agreements) from, say, Australia, Canada, and Iran then they conserve to the point of eliminating Iran, they are still 100% import dependent -- but security has increased, has it not?
No, because oil is fungible.
LNG contracts are very long term (even if a spot market exists). Other long term contracts exist for oil, coal, uranium, etc -- listen to a Cameco conference call and hear how long customers want to lock in supply (and a spot market exists for Uranium also). It's a very different thing to have a long term contract with Cameco versus a contract with a miner in the middle of Africa. What are the chances that the US will shutoff exports from Iran? Canada? Australia? -- you get very different answers to those questions.
You really don't understand what "fungilble" means do you?
Ask SA about those "long term contracts" to Asia.
I don't get what you're saying (although I do understand fungible).
I'm saying that as things tighten, oil may move almost completely to government negotiated agreements -- the very opposite of what most people believe. Most people appear to believe in a "bidding war" for scarce oil.
Here's your long term contract.
That's *exactly* what I'm talking about! The politicians are protecting somebody else's supply! It's NOT a freely tradable commodity! Asia has been rooked! Think!
Yes. Suppose, the oil available for me to import shrinks from 100 to 90. If I need 100, 10% of the activity that depends on oil will cease. If, however, I only need 80, I can fill my emergency storage.
I am of course aware that there are limits to efficiency: you can't run an economy like Japan on a barrel of oil by increasing efficiency, regardless of the amount of research or reorganizing or investment or time that is available. The goal must be to go without oil altogether. If, however, a single sector switches to no oil use, that increases the overall efficiency of and reduces the vulnerability to shortages.
It might be useful to look at the way of expressing it: if you increase the miles you get out of a gallon, that doesn't reduce your dependency on oil. Decreasing the gallons you need to go a hundred miles does. Technically, both are the same but it reveals another attitude on efficiency: expanding possibilities, or reducing needs.
I just saw that crude oil futures are only $70 for Dec 2011. For light sweet no less! Is this even remotely possible? Could oil go down that much?
In other words, how can I lose buying at these prices??
Korg,
Lets assume 5% inflation until then, and that the market expects 5% return on investment, so the total discount rate is 10%. 110%^4.5yrs = 153%. If oil is $66 today it will be $101.34 then. Scaling gas by the same factor gives $5.35/gal in the U.S., $1.97/l in Canada. You were hoping for more?
Actually, the market should expect more, given volatility.
I trade oil futures especially the CL (Light Sweet Crude) and COIL (ICE Brent crude) contracts. Yesterday after the numbers release I noticed something, which I should have seen way earlier.
The spread between these two contracts keeps widening at an accelerated rate. See my article here: http://globetrader.blogspot.com/2007/05/oil.html
After posting the article the spread has widened another 0.34$. That's a 1340$ profit holding CL N7 short and COIL N7 long since after the release. A position which should show you just marginally movement within a day.
As I show in my article until the end of March both contracts traded with a constant spread of about 1$, but in April that began to change substantially.
And I have no idea why this spread continues to widen. Maybe someone here has an idea.