DrumBeat: June 4, 2007

U.S. cuts back climate checks from space

The Bush administration is drastically scaling back efforts to measure global warming from space, just as the president tries to convince the world the U.S. is ready to take the lead in reducing greenhouse gases.

A confidential report to the White House, obtained by The Associated Press, warns that U.S. scientists will soon lose much of their ability to monitor warming from space using a costly and problem-plagued satellite initiative begun more than a decade ago.

Buyout firms + oil riches = Perfect match

Will oil states awash in cash be the next foreign governments to get in on the U.S. private equity boom?

Could Pipelines Move Ethanol From Iowa to Major Markets?

Iowa Congressmen Leonard Boswell has introduced bipartisan legislation to increase the availability of alternative fuels at gasoline stations across the country. The legislation calls for funding a study to find out whether underground pipelines would be a good way to transport ethanol and biodiesel.

China, US To Sign Pact To Develop Non-Grain Biofuels

China is discouraging corn-based ethanol development because of food security concerns, as corn is a staple food for people and livestock.

Dingell's energy committee proposes increase in fuel-economy standards

U.S. Rep. John Dingell's committee has proposed an increase in fuel-economy standards for cars and trucks, a sign that the U.S. auto industry would rather bargain with Congress than flatly oppose tougher efficiency rules.

Why Gas Prices Will Stay High

The chief economist at gasoline distributor Tesoro argues that a shortage of refining capacity is the culprit for consumers' pain.

Think gas is high? So are groceries

As if soaring gasoline prices aren't enough, consumers also pay more at the grocery store.

Economists say food prices in 2007 have increased more rapidly than they have in years. Most noticeably, the price of eggs, milk, bread, cereals, pork, beef, chicken and fresh fruits and vegetables reflect the increases.

Towns push to get paving projects done

Towns around Saratoga County are pushing hard to get their paving projects done before the cost of asphalt spikes as it did last year.

Depletion, racism and paving the road to hell

A while back a gentleman named Harvey Winston sent me an email, trying to explain why it is that the peak oil and climate change movements are as lily white as they are. I had asked in another post what we had to do to engage poor people, particularly poor non-white people, who are, after all, already the biggest victims of rising energy prices and climate change. Winston sent me some answers that are right on the money. And he kindly gave me permission to quote him and discuss this publicly.

Cartels: Myths and Realities...

It is not only in the Gulf that the issue of a new energy cartel that was making the news, but in Washington too, as the US House of Representatives approved on May 22, and by a large majority, legislation making oil producing and exporting cartels illegal under the Sherman Antitrust Act. The stage is set for a troublesome, legalistic battle of what constitutes a true cartel.

Britain's energy policy fails to stack up, says expert panel

The government has failed to provide Britain with a coherent energy strategy, putting future supplies and climate change goals at risk and falling short of what is needed to help the world's poorest countries adapt to rising temperatures, a top-level panel of experts says today.

India's trade deficit nearly doubles on oil costs

India's trade deficit nearly doubled in April, the first month of the financial year, from a year ago as costs for imported oil jumped, the government said in a statement Sunday.

Yes, it's a Big Deal

Presently, India imports a bulk of its energy requirements of coal, oil and gas; imports of high quality coal have grown at a rate of 16 per cent a year; by 2030, India's demand for oil will raise import dependence to 90 per cent; Indian demand for natural gas is expected to grow by over five per cent per annum and will be met by 70 per cent imports. This scenario is alarming not only because of the pressure it places on scarce foreign exchange resources, but also because it raises energy vulnerabilities that for a large country like India are neither affordable, nor strategically prudent.

Yemen: Skyrocketing prices or tradesmen’s greediness

A friend of mine, who has just returned from Dubai told me that prices of some foodstuffs in Yemen are higher than prices of the same commodities and products in Dubai city. He said he was shocked at the prices of yoghurt, oil, and milk, taking into consideration the big difference of quality between products sold in the local markets and the products of other world countries.

In Yemen, there is neither monitor nor control of foodstuffs’ prices.

China urges local officials to prepare energy efficiency plans

China urged local officials Sunday to prepare their own energy efficiency plans in a bid to save a floundering plan to drastically reduce energy consumption, state media said.

Gazprom May Thwart Putin Drive for Russian Energy Dominance

Last year, Gazprom, of which the government owns just over 50 percent, pumped 556 billion cubic meters (19.6 trillion cubic feet) of gas, slightly less than it produced 10 years before.

Iran says drivers will need cards to buy fuel

Iranian drivers will from Saturday only be able to buy gasoline using electronic cards, a system being introduced as part of plans to ration fuel and cut surging consumption, Iran's official news agency reported.

Russian chill cast doubts over new oil investment

A frostier climate for private investors in Russia, holder of the world's largest natural gas reserves, is likely to stop oil firms from pressing ahead with new projects there.

The collapse of Chavez’s Petroleos de Venezuela

The oil production capacity of PDVSA according to the plan would have been 4,580,000 barrels per day, 75% of this total, this is, some 3,200,000 barrels per day coming from PDVSA’s own capacity. What is the reality? Venezuelan production capacity is below 3 million barrels per day and PDVSA’s own capacity is below 2.5 million barrels per day. We are talking about half of the planned production capacity. This is not a normal deviation or even an abnormal deviation. This is a major collapse and one that would have produced, in normal times, the immediate dismissal of the Directors and managers in charge of the company.

Bypassing the Malacca Strait

Since the 1970s, various plans have been proposed to by-pass the Malacca and Singapore straits by cutting a canal or building oil pipelines through the relatively narrow neck of Thai or Malaysian land that separates the northern entrance of the busy waterway from the South China Sea.

Global warming or not, ocean is rising over Pacific islands

These Micronesians, whose islands spread from near the Philippines on the west to five hours from Hawaii on the east, require no charts or graphs to know that rising ocean water is a critical and constant presence in their lives.

When the moon is full, the ocean waves at high tide are several feet higher than ever in the past, according to longtime island residents.

Cost of gas hobbling area's poor

Eleven years ago, any kind of car -- even an old gas-guzzler -- was likely to be seen as a welcome companion on the journey toward independence and employment as mandated by the 1996 welfare-reform act.

Now, the family friend is part foe.

"Doubling the amount of money you spend on gas changes everything," said Laura Holton of the Fairfield County Department of Job and Family Services.

A couple of weeks ago, there were some stories about a fuel shortage in Qatar. Qatar denied it at first, but has now admitted it:

Qatar imports diesel to meet rising demand

An unexpected demand for diesel triggered by an exploding vehicle population has prompted oil exporting Qatar to import the fuel to meet local consumption.

Qatar Petroleum (QP), in fact, began importing diesel in June last year and the recent shortage was caused by a sudden import of 3,500 trucks last month, senior officials of Qatar Fuel (Woqod), sole distributors of petroleum products locally, said.

Woqod acts to improve diesel distribution

A STEEP rise in the number of vehicles last year, half of which are trucks, caused a spurt in demand for diesel but Qatar Fuel Company (Woqod) says it has built two additional loading stations at Mesaieed and Ras Laffan to ensure smooth distribution.

No plans to increase fuel prices: Woqod

QP plans action against ‘erring’ petrol stations

Though it is prohibited for petrol stations to sell wholesale as they are allowed to sell only in the retail market, he said “unfortunately some of them (petrol stations) have abused the situation and (are) putting much pressure (on the supply of diesel).”

...Asked about market talks that there has been siphoning off of diesel to other GCC countries where prices are high, he said it was not possible since Woqod was in charge of the jetties.

India: Use of cow dung as fertiliser decreasing

The age old tradition of use of cow dung as fertiliser by farmers is decreasing in the northern region.

It is due to the shortage of firewood in the region that has forced local poor people to use cow dung as fuel.

High oil price, supply fears help turn coal to fuel

Fears over energy security and high oil prices have rekindled global interest in technology, once vital to the siege economies of Nazi Germany and apartheid South Africa, that converts coal to transport fuel.

Nigerian unions threaten strike over fuel price

Nigerian labour unions will call a strike in two weeks unless President Umaru Yar'Adua reverses an increase in the price of fuel decided by his predecessor three days before the handover of power, union leaders said on Monday.

Ato Ahwoi slams Government over energy crisis

A report of The Heritage newspaper says Mr. Ato Ahwoi, one of NDC’s most knowledgeable in energy issues, has also challenged the Electricity Company of Ghana to justify the load shedding exercise going on now. According to him, what the country is experiencing is "electricity problem and not energy problem."

Speaking in an interview with The Heritage, Mr. Ahwoi noted that the current problem had exacerbated with the load shedding having moved from 12 hours every five days to the present 12 hours every other day.

High Gas Prices: The Road Ahead - Should we try to lower costs, or learn to live with them?

When fuel prices soared in the 1970s, both Democrats and Republicans embraced government intervention in the energy markets. But many of the measures they tried--including shortage-inducing price controls and the taxpayer-funded synfuel boondoggle--turned into disasters. The result: Lawmakers adopted a more or less hands-off approach toward Big Oil for the next 30 years.

Suddenly, though, intervention in energy is respectable again. The surge in gas prices has energized two types of people. The major group, including many prominent lawmakers, is looking for ways to drag the price of gas back down. A smaller group sees today's high prices as an opportunity to rebuild the economy for a future of permanently expensive energy. What they have in common is a shared belief that today's mostly free market in energy isn't working.

U.S. power stocks charge ahead as risks mount

But along with the resurgence, the industry faces new risks, from the growing movement to regulate carbon emissions to the aging network under ever-increasing pressure from consumers and regulators.

Those issues, as well as the shifting landscape in the global oil markets, the sharp rise in alternative energy systems and the difficulties facing large consumers of gas and power will all be in focus at the Reuters Global Energy Summit from June 4-7.

Oil, The State And Economic Policy In Iraq

Despite the plethora of US and Iraqi government-sponsored meetings inside Iraq, and even more outside, and the numerous documents produced on Iraq’s economy by the government’s foreign advisors and the US administration, there is insufficient understanding of the dynamics of the country’s post-2003 economy and its future direction. Recipes meant for developed stable countries are proposed for Iraq’s fractured economy.

Wyoming's natural gas boom sees growing pains

An explosion of natural gas drilling in Wyoming has given the state a huge financial boost - and a new set of problems

Coal To Liquid Fuel Debate Continues

If someone told you they knew how to improve America's economy, create new jobs, make the environment cleaner, and cut our dependence on foreign oil, you might think this miracle process was too good to be true, but many people believe coal to liquid fuel is the solution we're all looking for.

Big Solar's day in the sun

This is not the same old pipe dream. The economics -- and the technology -- of turning light into electricity have changed.

The 'Mysteries' of Bushenomics

Supposedly we are in a sustained economic recovery and have been since 2002.

Part of this is Bush hot air and the Republican Noise Machine, which the media quotes verbatim.

By a certain measure, however, it's real.

The economy has grown. Corporate profits are at an all-time high. Average income is up. There's lots of money around.

But the recovery has some really strange features. Oddities never before seen in a recovery.

Gas prices are budget busters for many

Drivers across the country are paying near-record prices for gasoline. While there's a lot of griping going on at the pump, for many Americans, higher gas costs represent a minor crimp in family budgets.

But for those living paycheck to paycheck, rising gasoline prices can mean the difference between being able to pay bills and going into debt.

Energy Independent: Maverick oilman Boone Pickens talks about fuel prices and his love for philanthropy

His research convinces him that the price of oil will average close to $70 a barrel this year: "You'll not see oil below $50 again except for very short spikes." The basic reason is that the difference between the world's daily production of oil and current world-wide demand is so tight. "Eighty-five million barrels a day is all the globe can do. The demand is right on 85 million barrels a day. It's quite unusual, but it means prices stay high." Oil-sand deposits from Canada will help, but Mr. Pickens is increasingly keen on alternative energy sources. He views the current ethanol craze as at least partially political--"Bob Dole once told me that there are 42 senators from farm states and that pretty much means the government is going to be into ethanol"--given that the product has a BTU content that's 30% less than gasoline and analysts often don't factor in the cost of the energy and water needed to grow the corn that goes into it.

Managing your risks essential for peace of mind

Even though [Yale economist Robert Shiller] is not ready to forecast oil prices, he does see signs of - you guessed it - a bubble in the crude market. This guy seems to see bubbles even when he professes not to know whether prices are going to be spiralling up or down.

Ireland: Failure to address crucial energy issue

The world is inevitably approaching the point where oil supplies will peak, before declining thereafter at a significant rate. The only uncertainty is when it will happen, and the experts reckon that it will happen almost certainly inside ten years and very likely in five, during the term of the next government.

Kurt Cobb: Road to nowhere?

Last week I attended a hearing on the transportation plan for my county for the year 2030. Similar plans are mandated by federal law for most localities in the United States. Though not explicit, the assumption behind our plan is that liquid fuels will remain cheap and abundant through 2030 and beyond. I suspect that most of the nation's transportation planners share this assumption and that therefore most of the country's transportation plans embrace it.

Moody's reports: Middle East oil companies lead the way on resources

Whilst the overall outlook for international oil company ratings remains stable, the growing longer term challenges to access and develop new reserves is likely to support greater co-operation between the international majors and some national oil companies, Moody's Investors Service says in its new Industry Outlook for the sector.

Sabic borrows billions to buy GE Plastics

Sabic's advantage stems from its access to abundant sources of feedstock from state-owned Saudi Aramco, the world's biggest oil company. The chemical maker exploits the natural gas released during Saudi Aramco's oil extraction to achieve costs lower than U.S. and European competitors.

900 miles per gallon

What if I told you I had invented a vehicle that ran on organic vegetables, got the equivalent of over 900 miles per gallon, was completely carbon neutral, and produced no toxic by products. Would you want one? What if I told you I got the price of this vehicle down to under $500 dollars? Are you reaching for your wallet? What if I told you that using the vehicle would improve your health, reduce your risk of cancer, and make you sexier? If you aren't ready to cut a check, check your pulse!

Indonesia threatened by global warming, rising sea levels

Indonesia is particularly vulnerable to the impact of climate change as global warming threatens to raise sea levels and flood coastal farming areas, threatening food security, according to a report released Monday.

Global warming overheats Australian politics

Australian Prime Minister John Howard, behind in polls ahead of a 2007 election, was accused on Monday of trying to scare voters by saying opposition plans to cut greenhouse gases would cause an economic recession.

Australia: Trading delay could spur power cuts

EASTERN Australia could face blackouts because of the Howard Government's decision to hold off carbon trading until 2012, warns a sustainability investment specialist.

Melting ice accelerates global warming: UN report

The melting of Earth's ice and snow is accelerating the effects of global warming and could trigger wider-ranging impacts on people, economies and wildlife, the UN warned in a report on Monday.

Climate change beyond our control

The basic problem I have with the Kyoto Protocol – and much of the environmental advocacy set to take place when the G8 nations meet in Germany next week – is its promulgation of an illusion of control when it comes to addressing the long-term effects of climate change.


Safety norms apply brakes on Reva

Reva, the only electric car which is exported to the UK market from India, may get a red signal from the UK government, owing to revised safety norms proposed by the UK Department of Transport.

The company has sold 2,000 units of the electric car, branded as the G-Wiz, so far in the UK. It is one of the largest selling mass-produced electric cars in the world.

According to the EU norms, Reva fits into the category called quadricycle — a vehicle with four wheels whose unladen mass is not more than 400 kg (excluding batteries if it is an electric vehicle) and whose maximum continuous rated power does not exceed 15 kw.


“But, due to increasing environmental concerns, new vehicles that qualify as quadricycles have come to the market and are becoming more popular for urban use. Therefore, it is right that we reconsider the regulations for this type of vehicle and make safety regulations more stringent.”


G-Wiz is marketed in the UK by GoinGreen. Because it is exempt from paying road tax, the London congestion charge and central London parking fees, the electric car’s sales in the country really took off. Besides this, other benefits include a grant for purchase of the car by customers, the lowest rate of tax as company car and 100 per cent tax writedown in year one for businesses.

Price of Gasoline

The price of gasoline in America was going up while the value of the dollar was going down.

The graph below shows the Canadian dollar rising. It reached a 30 year highs on June 1, 2007 of over .94 cents.

The once lowly Mexican peso has been rising compared to the U.S. dollar also. The U.S. bought oil from Mexico too.

Years of massive U.S. government budget deficits, debt payments, wage controls, and an unnecessary war have resulted in the dollar taking huge losses compared to stronger currencies.

The decline of easily recoverable light oil reserves and refinery bottlenecks were the major source of woe for the gasoline consumer.

Your average American citizen, who at beast is naive, at worst is an idiot, does not understand currency depreciation. All he sees is that the "greedy oil companies" have doubled the price of gas in the past 5+ years.

Even CNBC and the so-called "economists" have no idea what the actual, classical definition of inflation is - an increase in the money supply. Most think that if prices are rising then that is causing inflation. In fact, rising prices are symptoms of inflation.

...at beast is naive, at worst is an idiot...

Come Quasi, come...


Springs man builds electric pickup truck

The result: “Sparky,” an electric-powered pickup, constructed on the bones of a dinosaur-sucking 1997 S-10 Chevrolet.

The transformation of the ordinary brown truck was a journey of exploration spurred, in part, by the challenge of building his own battery-powered vehicle.

“There were some nonbelievers who asked me why I was doing this,” said Phillips, an electrical engineer with Welkin Sciences. “Because I can. Why climb Mount Everest? Why do anything?”


Jeff Goodwin and his crew at Bud’s Muffler installed extra leaf springs in the rear to handle the weight of 1,300 pounds of batteries. Goodwin and his team also donated their time to pull the pickup bed off and construct bar-steel boxes to hold 16 of the 20 deep-cycle, six-volt batteries that give the truck its juice. They also installed a simple lift system for the bed so Phillips could get to his bank of batteries.


Phillips said he knew going in that the truck would have a limited range — he’s only driven it 38 miles before a recharge, but it’s designed to have a range of 60 miles.

What he wasn’t quite prepared for was hills. He said because of the gearing in the transmission, the truck struggles to do much more than 30 mph up the hilly streets leading to his home. But that’s OK, he said. He’s in no hurry; he stays in the slow lane; and folks seem to give him the space he needs once they read the signs on Sparky saying “100% Electric Vehicle.”

“I see people in the rear view mirror getting in the other lane, but no one’s flipped me off yet,” he said.

On a flat road, though, Sparky can move; Phillips has hit 60 mph on Powers Boulevard, with just the hum of the tires and the spinning of the transmission gears indicating motion.
“There’s nothing more satisfying that driving something you’ve built,” he said. “I understand car guys now.”

All told, the conversion — not counting his time — cost $12,000.

Figuring in the $1,800 he spent for the batteries and the kilowatts used during the six hours needed to recharge the truck, Phillips reckons his cost per mile is 12 cents. His other car is a Chevy Blazer, and the cost to drive that beast is 20 cents a mile.
There’s also an attractive side benefit: He will over several years be able to deduct 85 percent of the $12,000 spent on the project from his state income tax.
Still, he said, Sparky isn’t for everyone.

“It’s definitely a second car,” he said. “I have to think about where I’m going. I can’t just jump in and run a bunch of errands.

Anyone seen any confirmation for the claim in the following column that "Russian oil production is declining dramatically?"

From the Guardian:
Mirror images

Presidents Putin and Bush will meet at G8 next week. But they have much more in common than they think.
Nina Khrushchev
June 3, 2007 3:00 PM

The Russian public, habituated to authoritarianism, wants Russia's rulers to be firm. Yet the true test of a ruler is not to pander to his people's expectations, but to peer into the future and match the country's aspirations with its needs and capacities. In this, Putin's arrogance is failing Russia miserably. His monomaniacal drive to centralise power is driving out the very expertise that the country needs to flourish. Shell and BP are being expelled from the oil industry at the very moment that Russian oil production is declining dramatically. His embittered attempts to counter American power are equally short-sighted: helping Iran develop its nuclear program and selling high-tech weapons to China are hardly in Russia's long-term strategic interest.

Doesn't seem to square with the official position.

MOSCOW. June 4 (Interfax) - Russia produced 202.754 million tonnes of oil and gas condensate in January-May, up 3.2% year-on-year, including 41.469 million tonnes in May, the Fuel and Energy Central Dispatch Center said.

Gas production rose 0.3% year-on-year to 284.929 billion cubic meters in the five months, including 53.241 bcm in May.

Russian oil exports to non-CIS countries rose 5.6% to 90.993 million tonnes in the five months, including 19.003 million tonnes in May.

Oil exports to the CIS fell, by 3.4% to 15.077 million tonnes in the five months, including 3.387 million tonnes in May.

Source: Interfax

This 3.2% increase is year over year for the first five months of the year. Last year, Russia averaged 9.116 million barrels per day for the first five months of the year. For January and February of this year they averaged 9.440 million barrels per day. (The April numbers are due out in a day or so.)

A 3.2% increase this year would mean Russia would average 4.08 million barrels per day over the first five months of 2007. They are already well above that figure for the first two months. This means that the average for March, April and May must be well below the average for January and February.

Of course this all depends on the EIA numbers being close. This is not very likely.

Ron Patterson

Officially y-o-y C&C production was +4.2% for the first quarter, +3.7% for Jan-Apr, and now +3.2% Jan-May. So the rate of growth certainly seems to be declining (it's noticeable that the Energy Ministry used to crow about month-on-month gains but has now started to use aggregated figures).

The Jan-Apr figure was 161.4m tonnes, which implies that May 2007 vs May 2006 was still positive, at +1.6%. Nevertheless, it'll be interesting to see whether Russia goes negative soon.

Last May Russian production was 9.190 mb/d. A 1.6% imporvement on that would put May 2007 production at 9.337 mb/d. That is abour 120 thousand barrels per day below the 9.46 mb/d they produced in February 2007.

Ron Patterson

From the Guardian:

Nina Khrushchev is a professor of international affairs at New School University. Her book Imagining Nabokov will be published by Yale University Press this autumn.

Nina Khrushchev is the granddaughter of Nikita Khrushchev, leader of the Soviet Union after the death of Joseph Stalin.

Nina Khrushchev's work for Cif is copyright Project Syndicate/Institute for Human Sciences, 2007.


It appears that tanker traffic into the Arabian Sea will be halted for at least 5 days! Gonu below 900 mill bars.
Wonder how Abu Dhabi & Dubai will fare with their sand Islands.


--I can say with confidence that this forecaster has never seen the likes of this:

thanks dipchip

I was just writing a question as to whether this had the potential to impact oil production / transport...

According to an entry on the weather underground blog this is the most powerful cyclone (currently Cat 5) ever recorded in the Arabian Sea...

Holy guacamole.

I found this track/strength estimates:

Super Cyclonic Storm GONU TRACK
(It is clickable to zoom in, or click GONU)

I personally have never heard of a hurricane/typhoon going thru the Persian gulf, but that could be for lack of interest for most of my life.

Are offshore platforms in the Persian Gulf any less subject to damage?!?

But it doesn't look like they predict it to make it into the gulf as a hurricane, at this point.

However, it is still a CAT 3 before the coast of OMAN, and given its width, it looks like it will effectly CLOSE the exit from the gulf until it weakens.

A supertanker wouldn't sail into a CAT3 would it?!?

If it made it into the Gulf the water temps in there are about 90 degrees. God only knows what it would do with that kind of energy available to fuel it. Maybe it would be too constrained by the surrounding land to hold together though even with all that available (very) warm water...

One more graphic to add:

12 hour wind field projection

This Super Cyclone will literally block the entire entrance to the gulf in less than 12 hours.

I have no idea what immediate effect this will have on the markets due to transit times from the gulf. I guess we will see.

The Weather Channel said they expect it to make landfall as a Cat 1.

That appears to match the current tracks/projections.

One difference, is the new track barely makes landfall before heading out into the Straits.

They updated it.

It is now on track to go right up the middle the STRAITS OF HORMUZ(sp)...dead on.

But they don't have it intensifying again over the water.

These graphics are dynamic, so depending on when you click the link in my upper post, the track could change.

My favorite FNMOC sites for following these storms are no longer available to the public, starting this season :-( , but the JTWC still makes public some images:

Looks like the straits of Hormuz may be in for some choppy weather.

Oh, and a nice intermediate size IR satellite image from INSAT:

And we were all worried about GOM hurricanes this year shutting down the oil machine. We are perhaps watching the wrong Gulf.

Does anyone have a map of oil assets in the Persian Gulf??


new thread on top, please take ALL GONU resources to that comment thread as well.

Well, I guess the good news is that we don't have to worry about WWIII starting in Iran for the next couple of days. I would imagine that the USN carrier groups are already taking evasive action.

Looks like mother nature did a preemptive strike :P :)

Well now we have a senario that no one has considered. A storm in the Persian Gulf to equal Rita and Katrina.
Will it tear up offshore and loading facilities. Also the empty tankers will not be getting into port. I don't know this but I would suspect that tankers already loaded are off loading for safty reasons.

Hello, $5 gasoline!

Above ground factor!!!

Okay, this is the Car and Driver article I saw at the barbershop a few weeks ago:

Building our way out of congestion.

I’ll bet I know what you were thinking when you heard America’s people counter had rolled over 300 million.

Brake lights, right? Traffic jammed up as far as the eye can see? Mr. and Mrs. America trapped in traffic just as helplessly as those ancient Pompeians were trapped in lava when Mt. Vesuvius blew.
Commuters are coping the hard way. According to the National Research Council, about half of all new commuters since 1990 have shifted their drive times to off-peak hours: 25 percent of them leave for work between 5 a.m. and 6:30 a.m., and another 12 percent wait till after 9 a.m. To serve the early birds, more than 90 percent of McDonald’s open an hour earlier now, at 5 a.m. Some commuters leave early to avoid the traffic and then nap in their cars until their cell-phone alarms wake them for work.

Blue-state wisdom says we can’t build our way out of this congestion with new roads; the concrete will barely have time to harden before they’ll clog up, too. Instead, blue-staters say, we have to limit population growth. It’s a quality-of-life issue, goes this wisdom: more for everybody if there are fewer everybodies sitting at the table.

(population figures ...)

Reducing the birth rate so we don’t outgrow our roads raises interesting questions. Hands, please — who thinks traffic will move faster when we have grandpa in every lane? Because that’s what happens when longevity improves in a country with a declining birth rate. The people, on average, get older. Compared with other developed countries, the U.S. has a relatively youthful population. The median age is 36.3 (the age at which half the population is older and half younger). Those countries in the world we think of as friends and allies, Germany, France, and Japan, for example, all have low TFRs. As a result, their populations are older, with median ages 42.2, 38.9, and 42.6, respectively,


The U.S. is a great nation today because the 48 percent of its people liberated from toil in the fields since 1900 have been doing more important work. The best measure of their cumulative accomplishment is this: American life expectancy during that period has been lifted by 28 years, from age 49 to 77. The question is: Will we get similar benefits from the roughly 63 million additional Americans expected by 2030?

Not if we fritter away their time and energy sitting in jammed traffic. We need to build more roads. We don’t wear the same size shoes we did as kids, and we don’t want the same road system, either, for the same reason. It’s already too cramped for the hale and hearty country we’ve become. The Reason Foundation has been doing original research on highways and mobility for two decades. Reason says we can build our way out of congestion. Details next month.


This is June's article:

Take the car or hop a choo-choo?

For a quarter of what we spend at the Home Depot each year, we could end congestion.

... Congestion won’t be a problem just for megacities, either. Between now and then, cities of 250,000 to 500,000 population will see their TTIs worsen the most, with increases of nearly 50 percent on average. Still, compared with L.A., their projected TTIs of 1.15 look relatively painless.

To fix the problem, we need an additional 104,000 lane-miles of capacity, the study says. That’s an increase of only 6.2 percent over the current system. So much for those who claim we’d need to pave the whole country. The cost would be $533 billion over 25 years, or convenient yearly payments of $21 billion.

Is that a lot? Maybe not. In 2005, we spent $41 billion at Lowe’s home-improvement centers, $82 billion at Home Depot, and almost $14 billion on pet food. The Congressional Research Service added up 16,500 earmarks in spending bills in 2005, for a bottom line of nearly $50 billion.

So the price is hardly shocking, but before it can be budgeted for lane-miles, we have to stop kidding ourselves. Are you going to hop the choo-choo to work? Me, neither. Yet “many planners are crossing their fingers and hoping to get people to shift behavior and leave their cars behind,” says the study. “In highly decentralized Los Angeles, where just 4.8 percent of people use transit to commute, over half of the long-range-plan money, $66.9 billion, is being spent on transit.”

That $66.9 billion, if shifted from transit, which commuters shun, to highways, where they swarm, would almost cover the entire $67.7 billion needed to relieve L.A.’s severe congestion.

When it comes to mass transit, I just happen to be an expert, master’s-degree equivalent, I figure, based on my 19 years of living in Manhattan. Everybody hated the “electric sewer,” as we called the subway, stinky and hot in the summer. Buses were worse—they were paralyzed by gridlock, and when they moved, they had to whoa every block or two for pickups and drop-offs. But we rode these systems anyway, and I quickly learned “the calculation.”

How to get there? For every minute of the day and every location on the island, we New Yorkers calculated our best transport choice. If you were within a block of a subway station, and if your destination were within a block on the other end, good deal. If either distance were more than four blocks, you groaned. If you had to change trains, oh, woe! For a group of two or more, share a taxi? No charge for extra passengers. Buses were hopeless, except after 7 p.m., when traffic was thinner, or if you just happened to see the right one bearing down on you. In the rain, you’ll pay up for a taxi, but so will everyone else, so all the cabs are busy.

This calculation was for Manhattan, where the subways stop every eight to ten blocks and any trip over eight stops is an epic. We chose our apartments and restaurants according to transit stops, and a woman worth a train change was a really special date.

I can still do “the calculation,” and it tells me that once you leave Manhattan and maybe Boston and Washington, D.C., “light rail” is a fraud on the taxpayers. Here’s why. Everyone is more than four blocks from the train stops, and so are their destinations. If you have to drive to the train, well, you might just as well keep driving. Even the worst traffic beats having some pierced-tongue gangbanger eyeing you as you wait on a lonely platform. ...


Notice he doesn't mention the trolley ...

New York, New York, it's a wonderful town!
The Bronx is up and the Battery's down
The people ride in a hole in the ground,
New York, New York, it's a wonderful town!

'Flip This House' star under scrutiny

McGee and others say Leccima's episodes of "Flip This House," A&E's most popular show, were elaborate hoaxes. His friends and family were presented as potential homebuyers and "sold" signs were slapped in front of unsold houses. They say the home repairs -- the lynchpin of the show -- were actually quick or temporary patch jobs designed to look good on camera.


I watched this a few times. It was basically an advert for how easy it was supposed to be to make money in real estate. Like Trading Spaces, etc. all the construction seemed to happen almost overnight, by people working in their spare time.

Well I suspect gas prices will hit $4 as European crude imports are delayed and gasoline imports to the US are in short supply.

Hi Dipchip,

Nice catch on the Gonu stuff.

When replying to other posts, please press the "REPLY" link instead of creating(POST A COMMENT/Star a new thread link) new threads.

It makes the conversations easier to follow.

If we actually had gasoline shortages in this country due to a freakin' HURRICANE in the Persian Gulf, it would be the most deeply ironic event I have ever witnessed!

Regarding food, etc., prices, I suspect that those prices in currencies other than USD are pretty flat. Americans just don't get [yet!] that the global economy and a sinking dollar will be reflected in rising prices, especially when the energy costs are, for petroleum products anyway, three quarters external. In other words, the cost of oil in Euros hasn't risen nearly as steeply. If the dollar drops thirty percent and oil remains flat, prices will still rise. What hasn't been stated is that, in global purchasing power parity terms, the wage rate in the US has fallen pretty fast lately. Nevertheless, it's still really high and most folks earnings are being squandered more on mortgages than groceries.

As to pipelines for ethanol, what would the Prohibitionists have made of it? It certainly would help to curtail bootlegging to pipe it. But I guess the alkies have all died off and the problem now is crystal meth. We've come a long way from running applejack from New Jersey to New York.

"If the dollar drops thirty percent"

USD bearishness is completely out of control -- be careful.

Re that article about peak oil and racism...I'm not convinced.

It's like those posts we used to get here, wondering why no women were interested in peak oil. Actually, a lot of women were and are interested in it. A lot of the posters here and at PO.com who are widely assumed to be male are not. I suspect it's the same with race. The default setting of human is the U.S. is white, straight, male. It's what we tend to assume people are online, when we have no way of knowing for sure. (On the Internet, no one knows you're a dog. ;-)

I would agree that the poor are probably underrepresented in peak oil forums, but not for the reasons given in the article. Rather, I suspect they are underrepresented online, and in the groups who have the leisure, resources, and connections to attend peak oil conferences and talks. Moreover, those who are poor tend to focus on the very short term. Who cares what gas prices are going to be next year when you can't afford groceries this week?

And it's ironic that they think Doomerism is a turnoff for the poor, when many here accuse the so-called doomers of being the poor, who can't wait until it all goes to heck, so they get a chance to reshuffle the deck, so to speak, rather than play the hand they have.

Why are greens so white?

Take cars. In India, it was "like you're earning $20,000 a year and gasoline costs $1 a litre, so they bought the smallest thing that would move their family. That's why you have the whole family sitting on a Vespa scooter."

Here, gas is much cheaper compared to what they earn, so they buy a big car or SUV, he says. "There's an attitude of entitlement. It's sort of like they're saying, `We just got to the same reality that's been happening for years. It's not our fault. We deserve to enjoy it.'"

Kids who bring environmental messages home from school are met with "a sense of indulgence," says G.A. Easwar, publisher of Desi News, which serves the GTA's South Asian community. When one reported he was to be involved in a creek cleanup, his father said, "`Oh yes, this is Canada. You're expected to do that.'"

Observes Easwar: "There are certain things you have to do, so you do it, but a sense of engagement and connection are necessary."

Others note that environmental conditions elsewhere are so poor that newcomers find it hard to believe there's a problem in Canada.

The experience of poor immigrants is far different. Some simply work too hard and long to get involved in any outside activities, and they're too poor to buy energy-saving gadgets.

"Your stomach has to be full to think of the afterlife," Easwar says. "For the environment, you need to have first fulfilled all your material needs."

Hi Leanan,

I guess this is the article you are talking about?

Depletion, racism and paving the road to hell

by Sharon Astyk

Anyhow, I don't think one has to be 'there' to be represented. I think it is more an elitist or unwitting attitude within peak oil or ecological forums that the author was commenting on rather than a lack of physical or online, non corporeal presence.

Running along the line of this instance:

We have a lot of choices, and we need to call our choices by the correct name. If we pick high gas prices instead of rationing, let’s be explicit about what we’ve chosen - we’ve decided to ration by price, and screw the poor again.

I have mentioned gas rationing on the Oil Drum but haven't pushed it, maybe it's time it became a more prominent subject for discussion here, among other items.

As a side note: As far as the comments about Kunstler I think where the article comes so close to being libelous that it is hard to judge where that line lies, the author should have included direct quotes from Kunstler as well as the context they were said in. (I think the author was a bit peevish there)

I think it is more an elitist or unwitting attitude within peak oil or ecological forums that the author was commenting on rather than a lack of physical or online, non corporeal presence.

Yeah, but she was saying that it was keeping minorities and the poor away. I think she's wrong. She's trying to quiet views that she disagrees with ("doomerism") by saying that it's keeping away minorities. When there is zero proof that this is true.

I found that article about PO/ racism / the poor rather patronizing as well.

The ‘whiteness’ of activism / involvement / visible presence etc. in ‘global’ matters, such as climate, PO, inflation, etc. as seen in the ‘expert’ community or online simply illustrates the general class structure (or class-cum-race) as seen from the US. (OK, the narrow focus was explicit.)

The author completely sets aside grass roots resistance / anti exploitative / anti globalization movements / groups / coordinations / etc. (many of which deal with resource use, etc.) world wide. In effect, one could judge that non-whites w-wide are more concerned and more active than Joe 6-pack or Marie-Anne in her designer dress.

Some of his points were very stereotypical; non-whites turned off the ‘issues’ by bigotry, this is really demeaning, as if non-whites / the poor couldn’t distinguish the problems from the bigotry; doomerism as a turn off as it spells disaster for the poor reverts directly back to the stereotype of the poor, black, passive worker who accepts his lowly fate. Ridiculous. Then he goes into a lot of pc. stuff about how the poor are more tied to community and family and have a lot to teach us.... reinforcing the ‘us’ and ‘them’ distinction. Not helpful, except for the fact that he does seem to be for ‘collective action’, whatever that is.


Excellent points. The whole tone of her article was like fingernails on a blackboard for me, and I think you've laid out why.

Okay maybe you are right about the authors intent, who cares what she says, it's what is brought up that is important. Even in this little dialog, the worry is about self image. By this I mean how come neither of you has taken up the point I mention about gas rationing, something that would interest the poor bastard trying to get to work, interest him in this site? Is it because there is no solution here or is it because it wouldn't jive with the yuppie money grubbing Starbuck latte drinking corporate Kabalistic razr phoning class of poster here. As far as protest on the street level I go to my local co-op radio for that. Sorry, but just saying the author is out of line doesn't really do it for me. Me, I'm just your average run of the mill reverse snob and just like slumming here.

Interesting take on the Qatar situation....

Dante says that the reason for the huge increase in trucks is that they are using them to build new energy infrastructure. And the fuel shortage is now impacting that construction.

There is already a shortage of trucks to carry building materials like cement, sand and steel, to cope with the rising demand in the booming construction sector and the diesel crisis has compounded the problem.

As it is, trucks are allowed to move within the city limits of Doha only for nine hours a day and now they have to wait in long queues for diesel, further aggravating the situation.

Building materials continue to be in short supply, but transporting stocks when they are available remains a perennial challenge.

Re: The 'Mysteries' of Bushenomics

Is this what "peak everything" feels like in America? Where the greatest return on investment comes not through investment in new and innovative people-employing technologies but rather comes from (1) cost cutting (off-shoring) and (2) from loaning funny-money to the stumbling middle class.

Asset stripping

While I still haven't made up my mind how severely the comming PO crisis will unfold and how society will morph into its next stage, I'm reminded about the following :

- the oil business is no gentleman's party
- peak oil is not just only about peak energy, the oil business is far too entangled with the rest of the world affairs and thus PO will add strain to quite a number of systems.

Darfur, china and oil

Gas prices are budget busters for many

Local car advertising - Come buy the energy efficent cars we have
And the other variant (one who shows a bunch of individual used transport)- We have a great selection of trucks and large vehicles. Back at $3.50 gas, 10 to 1 low MPG to higher MPG. When gas prices dropped, so did the ratio - now its back up. A clever monkey (or who who cared) could write a script to watch the used car web sites.

Local mid level manager who drives 60 miles one way mentioned last year that he was spending $800 a month fueling his truck. Told 'get a car - save yourself money', Blew that advice off. at the time. In the last month he figured out he could save $500 or so a month by getting a older car for the work commute.

(I leave it to the reader to figure out where that puts GM and others who's highest margin sales were in the SUV/Truck category.)

900 miles per gallon - sure if ferment sugar and burn the alcohol in an ICE. Someone else calculated as wattage and had 120 mpg as his answer.

Book your trips now! Visit these places before global warming destroys them!

The article is also largely about over-tourism despoiling the destinations. Kind of weird for them to say hurry up and visit these places before over tourism kills it ?

Yeah, there's definitely some irony here. Hurry up and book your trips on emissions-spewing jets to places that are in danger of being destroyed by tourism and global warming.


This paper examines tax evasion in the context of the diesel fuel market and the response of evaders to regulatory innovation. Diesel fuel used for on-road purposes is taxed, while other uses are untaxed, creating an incentive for firms and individuals to evade on-road diesel taxes by purchasing untaxed diesel fuel and then using or reselling it for on-road use. We examine the effects of a federal regulatory innovation in October 1993, the addition of red dye to untaxed diesel fuel at the point of distribution, which significantly lowered the cost of regulatory enforcement.

Baghdad Burns, Calgary Booms

Naomi Klein

The invasion of Iraq has set off what could be the largest oil boom in history. All the signs are there: multinationals free to gobble up national firms at will, ship unlimited profits home, enjoy leisurely "tax holidays" and pay a laughable 1 percent in royalties to the government.

This isn't the boom in Iraq sparked by the proposed new oil law--that will come later. This boom is already in full swing, and it is happening about as far away from the carnage in Baghdad as you can get, in the wilds of northern Alberta. For four years now, Alberta and Iraq have been connected to each other through a kind of invisible seesaw: As Baghdad burns, destabilizing the entire region and sending oil prices soaring, Calgary booms.


Now it turns out that the main river feeding the industry the massive quantities of water it needs is in jeopardy. Climate scientists say that dropping water levels are the result--fittingly enough--of climate warming.

Contemplating the collective madness in Alberta--a scene even the Financial Times has labeled "some dystopian fantasy"--it strikes me that Canada has ended up with more than Iraq's displaced oil boom. We have its elusive weapons of mass destruction too. They are out near Fort McMurray, in the jet-black goo beneath the earth's crust. And with the help of trucks, pipes, steam and gas, these weapons are being detonated.

A quick glance at http://www.FuelGaugeReport.com shows there is an historically-high spread between crude price and wholesale gasoline. This implies a constricted supply of refined fuel, not a constricted supply of crude. So, an increase in crude prices caused by adding to the SPR would mostly just narrow the refiner profits and leave retail prices little changed.

It appears that Sen. Ron Wyden is either clueless or playing politics. Seeing as he's a senator, I suspect probably the latter.

Wyden blasts Bush for filling SPR

Senator 'astonished' at transfer to reserve

As American gasoline prices hit record highs, Sen. Ron Wyden (D-OR) on Monday questioned the timing of the Bush Administration's announcement that it will begin transporting 9.2 million barrels of "Royalty In Kind " crude oil to fill the Strategic Petroleum Reserve.

Slated to begin July 1,this would be the first installment of a 27 million barrel transfer to the SPR.

In a letter to President Bush, Wyden expressed concern with the Administration's decision to forego the revenue from the sale of the Royalty In Kind oil - which at current prices could mean more than $1.6 billion for the U.S. Treasury - and further depress the supply of crude oil, which will likely mean higher gas prices for Americans.

Wyden writes: "Unless the Administration has figured out how to repeal the laws of supply and demand, it is economic malpractice to remove 27 million barrels of crude oil from the market when consumers are now buckling under the weight of record high energy retail prices for gasoline. I ask that these purchases be halted to prevent further pressure on oil and gasoline prices when Americans already are suffering from energy costs rising at a far greater rate than their paychecks."

The U.S. Strategic Petroleum Reserve, which was created following the 1973 energy crisis, is the world's largest emergency supply of crude oil, with a current inventory of 690 million barrels.

So why is Putin coming to Maine to yak with Bush? Seems to me Putin holds a pretty good hand. Did he invite himself? Will Osama be there too? Will we mere people be carved into meat?

The beauty of the SPR is, the same senator could bash Bush for not filling it .

Re: U.S., China to sign pact to develop non-grain bio fuels.

I can not let this pass without commenting. There are so many fallacies in this that it boggles the mind. I will list them according to importance:

1. The arable land area of the world and of any individual country is finite. If other crops are planted on it, the area of land available for food is decreased.

2. Infrastructure is critical in ethanol production because of the huge volumes involved. If sweet potatoes, cassava and sweet sorghum are to be used in place of corn, an infrastructure (futures markets, transportation and storage as well as farming equipment) must be developed on a massive scale that already exists with corn.

3. The last I heard the examples given as alternatives to corn are in fact food. Sweet potatoes for sure. Cassava is. And sweet sorghum is a grain if it is similar to the sorghum we grow here in Iowa. How can a grain be an non-grain? Am I missing something?

4. The basic problem with corn used for ethanol is that the market price for corn is still ridiculously cheap when its energy content is considered. The only way to stop corn ethanol is for the price of corn to rise such that it is no longer economic for ethanol. I believe that price is currently about $5.00 per bushel. At such a price corn would still be economic for food in many cases. Some producers such as pork would have to shut down until the price of food rose. We have had a cheap food policy with subsidies being paid to corn growers for so long that a market price for food which reflects the energy content of corn is now perceived as an outrage. In a post peak oil world with a market economy, energy forms should reflect the appropriate energy content in the price. Many here bemoan the amount of oil used in food production and yet fail to see that food and energy are the same thing. What is wrong is that food prices are not high enough to reflect the energy content in it. When that happens food will out bid ethanol and the problem should solve itself. Many will not like it, but IMO that is the way it has be if you don't want a command ecomomy similar to Castro's Cuba.

Yes, I too am a bit confused about calling Sorghum a non-grain.

Here is some background on Sorghum:

I remember the sorghum fields from when I was growing up back in the midwest. It never occured to anyone to call it a "non-grain".

Your point about food prices being too low and eventually the food buyers will out-bid the ethanol producers is well taken... except that on a worldwide basis (and given that food is readily transportable around the world) the imbalances between nations will skew the results into something that may be most unpalatable. E.g., US ethanol buyers still oubidding the food buyers in Africa, even though the US food buyers still outbid the US ethanol buyers.

There are several different types of sorghum: one type for a grain, another for a syrup, yet another for brooms.