DrumBeat: October 31, 2007

Pemex restores much of its oil production

Good news? Well, sort of...

The company, known as Pemex, had suspended 1.1 million barrels of output on Tuesday after too much crude piled up at storage facilities and ships couldn't move it out due to port closures.
That's almost twice as much oil shut in as they originally reported! No wonder crude is over $96 in after hours trading. (And no wonder Pemex waited until after hours to make the announcement.)

UPDATE: Bloomberg's take on it:

Petroleos Mexicanos, or Pemex, resumed some oil exports and revealed that a storm caused more output to be halted than had been assumed.

"The shock of the data is understandable when you consider the news from Pemex that they shut in something like 1 million barrels a day, not 600,000," said Chris Mennis, owner of oil broker New Wave Energy LLC in Aptos, California. "Most of that would have been going to the U.S."

Unsustainable mining harms Australia

Dr Mudd said the statistics were alarming. "On average, 27 tonnes of greenhouse emissions are created to mine a tonne of uranium. That's equivalent to the annual emissions of nine family cars. To mine one kilogram of gold it takes 691,000 litres of water, and it takes 141 kilograms of cyanide to produce a single kilogram of gold.

"There is often talk about sustainable mining, but our latest body of research shows that minerals are being mined at an alarming rate, mining companies have to work harder to source it, and as a result the environmental costs of the process and clean-up are rising exponentially.

Petrobras caught short on gas supplies

Brazilian state energy company Petrobras was forced by a court injunction to restore natural gas deliveries to some distributors today after it had trimmed supplies to feed gas-fired power plants instead, raising fears or energy shortages.

URGENT: China to raise gasoline price

China will raise the prices of gasoline, diesel oil and aviation kerosene by 500 yuan per ton, almost a 10 percent rise, starting from November 1, China's economic planner announced on Wednesday.

...The adjustment was made to shorten the gap between high-flying international crude prices and state-set domestic oil prices, according to the National Development and Reform Commission.

Nepal: Petroleum shortage likely to continue

The Nepal Oil Corporation (NOC) today paid INR 1.5 billion to the Indian Oil Corporation for a new consignment of oil supply but the quantity of oil the money will fetch will still not meet the market demand, said Eccha Bikram Thapa, NOC’s spokesperson.

Wall Street drilling for Middle East riches

NEW YORK (Reuters) - Wall Street bankers are flocking to the Middle East, and it's not for oil or the balmy weather.

Years of raging energy prices have made the states surrounding the Persian Gulf one of the fastest-growing regions and a source of immense wealth seeking investments at home and around the world.

Horizon oilsands project forecast to go $1-billion over budget

Canadian Natural Resources Ltd. expects the cost of its Horizon oilsands project to jump as high as $7.75-billion, nearly $1-billion over budget, as some work gets pushed out into winter, the country's No. 2 independent producer said on Wednesday.

Energy trusts in no hurry to become corporations

Some of Canada's largest oil and gas trusts say they are in no hurry to flip back into corporations by 2011, when they will be taxed at the same rate as the explorers and producers (E&Ps) they compete against.

Memo Mr President: get tough on the black-gold cowboys

THE United States is the best-armed nation on earth and I'm not talking about its army.

It's time to get out the oil rags, clean the guns and check the condition of the ammo.

The great speculators' oil theft has to be stopped.

Leaders lost on a road to nowhere

The price of oil is heading towards a $100 a barrel and within the life of the next Federal Parliament the price of petrol could be twice what it is now. Almost certainly freeways — both those recently built and those likely to follow Sir Rod Eddington's report later this year approving Melbourne's multibillion-dollar East-West tunnel — will become "stranded assets" well before the end of their economic life in 60 years' time.

What is now in question is whether Melbourne becomes a "stranded city" or its infrastructure is planned to take into account the impact of peak oil and global warming.

Gunmen attack Nigerian navy boat, 1 dead

Gunmen in speed boats attacked a Nigerian navy vessel Wednesday on the oil-rich Niger Delta coast, killing one officer and wounding several others, officials said.

The main militant group in region claimed responsibility for the attack, saying it was meant to show that "the presence of the Nigerian military in the Niger Delta can not deter an attack nor provide protection to oil facilities when we decide to attack them."

Get used to $100 oil, OPEC warns

Several leading oil experts, gathered here yesterday for an annual energy conference, sketched a near-term future in which mounting global demand and shrinking supplies push oil prices well past the $100-a-barrel (U.S.) mark.

Consuming countries, they argued, will simply have to deal with the fact that new pockets of oil are getting far harder and more expense to tap. That, combined with years of underinvestment by the industry, has led to a tapering off of new oil supplies that will continue for years, despite rising energy demand in Asia, the Middle East and some industrialized countries.

Emirates get an early whiff of a Western bugbear - energy shortage

The Emirates have an energy problem. It is not obvious to outsiders, who see in the Gulf a bottomless lake of hydrocarbons. Nevertheless, the tiny kingdoms that make up the United Arab Emirates are struggling with energy.

It is not only Dubai, the ambitious city-statelet that is reinventing itself as the Singapore of the region, pumping the wallets of tourists and financiers as its oil wells run dry. The whole region needs more power and, above all, it needs more natural gas to generate the electricity that keeps the lights on, the water desalinated and the air chilled in the hothouse petrodollar economy. Like tigers chasing their tails, the Emirates are in a frantic dash for gas.

Diesel fuel supply low in Jamestown

Dave Vining of Vining Oil and Gas said, prior to this fall, there were occasional temporary fuel outages at terminals, but fuel was arriving regularly enough that he could keep up with demand. However, he said, the situation worsened dramatically beginning about 60 days ago, and he’s been able to purchase only about 60 percent of his usual supply.

Tokyo Electric Predicts 1st Loss in 28 Years on Costs

Tokyo Electric Power Co., forced to shut the world's biggest nuclear plant after an earthquake, predicted its first loss in 28 years to pay for repairs and a switch to costlier oil and gas-fired generation.

"I expect next year to get tougher if oil prices stay at current levels," President Tsunehisa Katsumata told reporters in Tokyo today. He will accept a 20 percent pay cut starting November to take responsibility for the expected loss.

How High Can Oil Go?

Don't be surprised to see a test of $100 a barrel soon, even though that's far higher than what market fundamentals call for.

Pemex's Gas Pipeline Bursts in Southern Mexico

Petroleos Mexicanos's natural gas pipeline exploded in Tabasco state in southern Mexico, Reuters reported, citing Oscar Ferrer, mayor of the city where the blast occurred.

Mexico sees storm-hit oil sector normal by Thursday

Mexico's storm-crippled crude oil sector should be operating as normal by Thursday morning, state-owned energy monopoly Pemex said on Tuesday as one of the country's three main oil ports reopened.

Diesel Shortage Strains Ties in Bolivia

A diesel shortage is aggravating tensions between President Evo Morales' populist government and conservative agribusiness leaders, whose tractors need the fuel to begin Bolivia's planting season.

‘Pakistan should exploit coal for power generation’

Pakistan needs political consensus and political will, it should utilise its indigenous resources of coal for power generation and in other projects for longer run rather than rely on short-term projects. This was the consensus of speakers presenting their views on the first day of a two-day international symposium and open house discussion on ‘Sindh Coal (Lignite) Mining Challenges and Success’ on Tuesday at a local hotel.

BP offers Abu Dhabi green solution to chronic gas shortages

BP is in talks with Abu Dhabi to build a green energy project that would produce hydrogen from natural gas and store carbon dioxide in the Gulf emirate’s oil wells.

The novel scheme could provide clean electricity to the emirate and at the same time help Abu Dhabi to find a solution to a gas shortage in the Gulf, which threatens to undermine the rapid economic expansion of the oil-rich city state.

Is Hydrogen the Answer to Our Future Transport Needs?

Many auto companies are investing heavily in hydrogen fuel cells but battery-electric vehicles are just as compelling.

Waste wafers give solar power a silicon boost

A simple method of recycling waste silicon from microchips that could help ease the shortage of refined silicon for solar energy panels has been developed by IBM.

Supersonic, manta rays or slower planes? The future of air travel

A world without air travel is inconceivable, but what might it be like in the future? Is the jumbo's jumbo, the Airbus A320, a taste of bigger craft to come? And with energy sources in question, will we even be flying?

Engineer guilty of hiding nuclear plant damage

A federal jury convicted a former nuclear plant worker Tuesday of concealing the worst corrosion ever found at a U.S. reactor. A second defendant was acquitted.

David Geisen, the Davis-Besse plant’s former engineering design manager, was accused of misleading regulators into believing the plant along Lake Erie was safe. He faces as much as five years in prison.

Can GM crops end food supply shortage fears?

Predicted bioethanol growth means that in this state alone, corn production will have to increase by 160% to meet the food and fuel demand. Mike Owen from Iowa State University believed GM technology would be crucial to doing this in an environmentally sustainable way.

"Perhaps one of the most important successes has been the savings, environmental and economic, resulting from the change to conservation tillage - particularly no tillage - attributable to GM crops."

Oil reserves over-inflated by 300bn barrels – al-Huseini

The world’s proved reserves have been have been falsely puffed up by the inclusion of 300 billion barrels of speculative resources, according to the former head of exploration and production at Saudi Aramco, and this explains the industry’s inability to raise output despite soaring prices.

Sadad al-Huseini’s presentation to the Oil and Money conference in London went substantially as previewed by lastoilshock.com, but the analysis he delivered may also throw light on the infamous OPEC reserve additions of the 1980s.

Efficiency replaces conservation as the goal of energy saving policies

Governments around the world that used to promote energy conservation are shifting their focus toward energy efficiency as a way to curb global warming without constraining economic growth, according to energy and environmental officials.

Oil industry experts predict supply crunch in coming years: Underinvestment, skill shortages and difficult-to-access reserves, likely to keep oil above $100 a barrel for sustained period

As the price of a barrel of crude oil heads for the $100 threshold, and will soon exceed the real dollar all-time record value reached in 1980,* the annual Oil & Money Conference was told in London on Monday, that shortages of skilled labour and long-term under-investment mean oil supplies are unlikely to meet the expected growth in demand over the coming years.

Analysts play down concerns over UK energy supplies this winter

Analysts have played down concerns that the UK is facing an energy crisis this winter, following an electricity supply warning posted yesterday by National Grid, the UK gas and electricity transmitter.

This Chart Will Scare You

I can't think of a more ghastly Halloween tale than the current situation in oil and gas. Let's start with a few important facts...

Sentiment Grows In Oil-Hungry U.S. For Extended Middle East Presence

Sentiment is growing in both political parties for extending the U.S. military presence in Iraq in order “to ensure the safe flow of petroleum,” according to the Nov. 12th issue of The Nation magazine.

Not only is President Bush protracting U.S. engagement in Iraq but the two leading Democratic contenders for his job, Senators Hillary Clinton and Barack Obama, don’t appear eager to quit Iraq, either.

Monbiot: Civilisation ends with a shutdown of human concern. Are we there already?

A few weeks ago I read what I believe is the most important environmental book ever written. It is not Silent Spring, Small Is Beautiful or even Walden. It contains no graphs, no tables, no facts, figures, warnings, predictions or even arguments. Nor does it carry a single dreary sentence, which, sadly, distinguishes it from most environmental literature. It is a novel, first published a year ago, and it will change the way you see the world.

Cormac McCarthy's book The Road considers what would happen if the world lost its biosphere, and the only living creatures were humans, hunting for food among the dead wood and soot. Some years before the action begins, the protagonist hears the last birds passing over, "their half-muted crankings miles above where they circled the earth as senselessly as insects trooping the rim of a bowl". McCarthy makes no claim that this is likely to occur, but merely speculates about the consequences.

A wake-up call

We are in deep trouble. Yet, despite the fact that we have been toldwe are facing an unprecedented climate crisis, life goes on pretty much as it always has. We celebrate the seasons with new fashions, we employ designers en masse to aestheti cise our environment, we have elevated design to art status and are now reaping the rewards. TV ads tell us that we are doing well by the environment – so, are we?

Building post carbon cities

Record-setting prices for oil are creating huge problems for America’s cities as they struggle to cope with soaring fuel costs. In Post Carbon Cities: Planning for Energy and Climate Uncertainty, Daniel Lerch of Post Carbon Institute shows city leaders how to create their own plans to reduce local vulnerability to rising prices and volatile energy markets.

Don’t Rush It. Dig In: Defining Advice for the Possibilities Ahead

This is not the first time I have grappled with the end of the world. Usually the images that flash through my mind, involve drowning, fire, or thirst; it always ends the same way: I calm down and go back to the work I was doing before the news flash told me the world was ending.

In short this is how I spend most of my crazy “environmental” life. Everyday I work, in my own small ways, to create a more sustainable world; but I oscillate constantly between the practicality of these small daily actions, and the need for large-scale change with the greatest urgency.

TransCanada Advances Keystone Oil Pipeline Project

TransCanada continues to make significant progress on the Keystone Pipeline project. Based on strong industry support, TransCanada has entered into contracts or conditionally awarded approximately U.S. $3.0 billion for major materials and pipeline construction contractors and is continuing to secure land access agreements in preparation for the start of construction in the spring of 2008. Based on the increased size and scope of the project and the executed material and service construction contracts, the capital cost of Keystone is expected to be approximately U.S. $5.2 billion.

Nuclear ambitions fan controversy in Bulgaria

As governments around the world struggle to secure energy supplies, cut carbon emissions and adapt to rising oil prices, Bulgaria has adopted an ambitious solution: Construct a new nuclear power plant, the country's second, near the northern town of Belene, across the Danube from Romania.

Are you ready to pay for light rail to Fife?

The junk mail from "Roads & Transit," the marketing name for the proposed 9.5 percent sales tax, arrived at my house the other day. It says, on one side, "Turns out, it really is ALL ABOUT YOU." A little arrow points to the photo of a car stuck in traffic.

That's you.

Turn the card over and on one half is the 520 bridge. It says: Roads & Transit is all about you. On the other half it says ... and everyone else, too — and shows a light-rail car.

There is the message: You drive, they take the train.

ASPO-China is formed

It was unanimously agreed that ASPO-China should be formed and that Peak Oil research and modeling is essential to China. As seven of the nine new leaders in China have been engineering students it is expected that Peak Oil will feature in future government policy-making decisions.

$3-a-gallon gas around the corner?

Demand for oil has been increasing faster than supply. Iran-U.S. tensions have been growing. Traders have seen more danger in bidding low than high.

Worse, muttering about reaching a global limit on production — "peak oil" — has become increasingly common. Add it all together and predictions of $100-a-barrel oil have gone from beyond-the-fringe to mainstream.

Cause for concern on Main Street, USA

We are rapidly approaching a time of reckoning. What happens when the American people discover that our nation will soon be fighting with Asia and Europe for control of a rapidly dwindling supply of petroleum? When they discover the dollar is becoming an increasingly worthless currency on the world markets? When they discover that other countries are tiring of lending America money to prop up a bankrupt government? When they discover that most of the wealth created over the past decade is based on fraud? When they discover that our current way of life is unsustainable in a world of scarcer resources caused by the double whammy of peak oil and climate change?

Check out the world's largest Oil Reserve

What if I told you the world isn’t running out of oil and that we’ve got more than 3.7 trillion barrels left to burn through?

You’d consider me downright crazy. After all, with oil prices surging to new highs on a weekly basis, it’s apparent we must be running out.

The end of the industrial age

How will the world look when we finally wean ourselves from our oil-addiction – whether because we embrace new low-carbon advances, or just because the oil runs out? The graphic artist who worked on the series, Andy Mosse, reworked Turner's masterpiece so that the Fighting Temeraire, rather than being towed into port by a hardy little tug, is instead towing a clapped-out giant passenger ferry into harbour, through waters strewn with oil drums, shopping trolleys and plastic bottles. The age of coal and steam power has come to a close, and a new age of wave and wind is dawning. Gas turbines now give way to windmills, steam-ships to sail.

Azerbaijan passed quite pessimistic medium-term forecast with GDP growth cutback to 3.5%

In 2009-10 the country is forecasted to reach peak oil production (around 65 million tons a year) to start reducing since 2011-12.

Latest Price Jump Discourages Big Oil Mergers

Major oil companies are more likely to use the extra revenue from the latest jump in oil prices to continue share repurchases rather than undertake costly acquisitions, analysts said.

Foreign oil workers released in Nigeria

The hostages were freed unconditionally and no ransom was paid, police spokeswoman Ireju Barasua said.

The Movement for the Emancipation of the Niger Delta, or MEND, said in an e-mail to The Associated Press that the workers had "poor hostage value" because of their nationalities.

Changing climate haunting tourism

It is often said that farmers are on the front lines dealing with global warming, their livelihoods being extraordinarily dependent on the weather. But tour operators and resort owners are not far behind.

Peak oil: How serious is it?

Oil is the lubricant of our society. Transport is the obvious point of consumption, but the use of oil pervades almost all aspects of modern living. Agriculture (not only tractors, but also pesticides and fertilisers), plastics, pharmaceuticals, toothpaste, clothing, cars, and the generation of power are all, to some extent, dependent on oil.

So, a rising oil price actually means an overall increase in the cost of living. And that is just scratching at the surface of the problem. Our casual reliance on oil as an energy source, aside from wrecking the environment, is about to hit some serious hurdles. If peak oil theorists are to be believed, the end of the Oil Age is nigh.

China fuel crisis spreads

China's worst fuel crisis in two years spread to the capital and other inland areas by Wednesday, and one man was killed in a brawl at a petrol station queue, upping pressure on the government to intervene.

Diesel shortages in China's political heart, which escaped previous supply crunches unscathed, highlight tensions between the government and its increasingly independent oil firms about who should pay for the country's generous fuel subsidies.

Top refiner Sinopec on Wednesday pledged more supplies and bought additional diesel fuel abroad, but it may fall to Beijing to end the stand-off by raising domestic prices, easing taxes, promising another year-end pay-off -- or simply strong-arming suppliers into selling more fuel at a loss.

Why the Economy Can Withstand $100 Oil

Forget the credit crunch and mortgage crisis for a moment. What about rising oil prices? So far, the economy has shaken off high prices at the pump, no problemo. But what if oil his $100 or more? Don't fret, says Jim Glassman of JPMorgan.

£1 a litre is now normal at the pumps

The AA warned motorists last night that they face a “winter of misery” as petrol prices rose to their highest levels.

Rising fear of energy crisis this winter

Britain faces the prospect of power shortages and soaring prices this winter after the National Grid warned of a shortfall in electricity-generating capacity yesterday. The alert coincides with a surge in gas prices, which are now 40% higher than in continental Europe, and the confirmation that a vital import plant in South Wales will not be operational this winter.

East Siberia oil growth uncertain - TNK-BP CEO

Lack of exploration in new East Siberian oil fields means it is unclear to what extent that region can make up for declines in West Siberian production, the boss of one of Russia's biggest companies said on Tuesday.

Iraqis say ready to take control of oil terminals

For the first time since U.S.-led forces toppled Saddam Hussein more than four years ago, Iraqi soldiers are taking charge of protecting the country's greatest assets against insurgents under a plan to hand over control to Iraqis.

World's growing dependence on coal leaving a trail of environmental devastation

It takes five to 10 days for the pollution from China's coal-fired plants to make its way to the United States, like a slow-moving storm.

It shows up as mercury in the bass and trout caught in Oregon's Willamette River. It increases cloud cover and raises ozone levels. And along the way, it contributes to acid rain in Japan and South Korea and health problems everywhere from Taiyuan to the United States.

This is the dark side of the world's growing use of coal.

Transport growth will not increase emissions, government claims

The road, rail and air networks of Britain can all be greatly expanded without undermining Britain's commitment to reducing climate change emissions, a government report claims.

The "pro-green, pro-growth" discussion paper launched today by the transport secretary, Ruth Kelly, wants to see a new high-speed rail linking London, Birmingham and Manchester, wider motorways, congestion charging in more cities, and bigger sea and air ports.

Government 'puts the economy before the environment' with transport plan

Ministers were accused of downgrading the drive to cut carbon emissions from Britain's transport network after revealing a long-term strategy for increased road, rail and air travel.

UK invites private funding for 'green' transport

Britain invited the private sector to play a bigger role in plans to ease congestion of the UK's clogged transport network on Tuesday while keeping a lid on CO2 emissions.

How to Build a Local Energy Economy

Is it possible to get our power from local sources? Yes, and an interview with one expert explains how.

Hello, I’m your personal travel adviser. Can I persuade you to get on your bike?

The doorbell will be ringing unexpectedly in millions of homes from next year as an army of government-funded “travel advisers” tries to persuade people to switch from driving to walking, cycling and public transport.

If you are out, they will keep coming back and will call up to ten times, even in the evenings or at weekends.

Could a Melting Ice Sheet Really Raise the Oceans 23 Feet?

1 melted Greenland ice sheet = 23-foot rise in global sea level

That’s the rough equation behind a frequently cited stat in news coverage of climate change. According to a transcript, Anderson Cooper said in a CNN special report this week, “If the entire ice sheet dissolved, sea levels would rise by 23 feet — spurning a global catastrophe that would flood coastal cities and displace tens of millions of people. Scientists don’t think the entire ice sheet can melt any time soon, but every inch of sea level rise counts. Millions live near coastlines less than three feet above sea level.” The dire 23-feet number also appeared in a CNN.com article this week, as well as in the Washington Post.


The Cornucopian Cemetery

(Happy Halloween!)

There's been a lot of talk about rail here. The latest Global Business podcast from the BBC is about a rail revival or sorts in Europe.

Global Business

On Nov 14th the UK's first high speed railway opens cutting 20 minutes off the time it takes to get from London to the Continent and that is just the beginning of a rail revolution in Europe. By the end of the decade regulation will hit the state operators and many of them have formed a new alliance so train tickets can be purchased across borders. With all this and more and more high speed rail travel making it tempting to jump on the train instead of the plane is transport In Europe being changed forever.

Question and informal poll:

If there are large drops in today's Weekly Petro Report and the Fed cuts rates between .25 & .50, how many believe WTI crude will reach $100 TODAY?

Maybe, but only if in addition to this the Fed lowers by 50 bp and GWB utters the words "Iran" or "democratize" or "nookyaler," preferably in the same paragraph.

Dragonfly, most are expecting a .25 point cut, so that's already built in to the price. .50 point cut probably gets to 93 something again today. No cut and it plummets to 88 or lower.

"No cut and it plummets to 88 or lower."

The DJIA will drop over 300 pts.

Arkansaw of Samuel L Clemens

If it went to $100 today, that would qualify as a Black Swan.

Arkansaw of Samuel L Clemens


By very virtue of the fact its being talked about, it can't be a black swan (unlikely maybe, but its not unthinkable).

If it were to go to $110 that might qualify.....or at least it would have if I hadn't just mentioned it.

I have stated that I believe it will go to 100, if they cut the whispered .50 pts.

.25 may not be that surprizing...but I think it will stay up around 93-95 range.

If they do nothing, bah...they won't.

Still think there is a better than 50% chance we will get .50. But, only G*d knows how these guys think. And, they may have been frightened by the crude run up in the last week.

Then they're telegraphy machine is broken, because
everyone is expecting a rate cut.

The $ will crash if they go 50.

But Goldman will crash if they don't.

Arkansaw of Samuel L Clemens

The dollar will crash either way...just a matter of rate of crash.

The Senate votes to fund Amtrak for a little while longer, without any meaningful expansion:

If we quadrupled Amtrak's budget, that would cost one-tenth of the war in Iraq.

A FAR better use of limited (so far) Gov't subsidies would be to build more Urban Rail faster. Permanent changes to Urban form and long lasting oil savings, the creation of a vital segment of a non-oil transportation system. The GWB administration has cut federal funding for new Urban Rail from 80% to a de facto 30%.


Versus an annual operating subsidy for Amtrak with very limited long term impact. It has been a few years since I calculated "diesel Amtrak" (not electrified Northeast Corridor or Harrisburg-Philadelphia) pax mileage, but in 2001 or 2002, Amtrak got 78 pax-miles/gallon. Southwest Airlines is running close to 53 pax-miles/gallon.

I would MUCH rather see the "Red Line to the Sea" in LA, etc. etc. etc. than an expanded Amtrak, if I have to chose.

Best Hopes for Rational Planning,


So why should the farmer in Nebraska or the rancher in Wyoming want to see federal funds going build light rail for the benefit of urban areas? What is in it for him?

A larger economy (see Millennium Institute modeling) and someone else to help pay the taxes (Hint: Post WW II Germany was largely financed by their farmers, the only people with anything of value left).

Less Global Warming (MI model shows largest drop in GHG combined with largest GDP).

Less competition for fuel.

BTW, electrifying their freight RRs (out in NE & WY) is a slightly higher priority of mine than Urban Rail. Diesel Amtrak is *NOT* a priority (although I took Amtrak to ASPO-Houston for $46).


But what about for funds? Out of curiosity and skepticism, and since there appears to be almost no opposition or criticism to light rail on this site, and my experience with fraud in public projects in Chicago, I’ve decided to be a “devils advocate” on this subject, sort of a sacred rail car tipper. I could be wrong, but it looks like a lot of the projects you promote are financial fiascos.


Now I’m only starting to look at these sources, but again, my experience tells me that projects like these tend to attract hustlers like shit attracts flies. Is this the tip of the iceberg?

The USA has developed a "ration by queue" approach to reduce growth of Urban Rail. The current system is dysfunctional, with excessive studies.

The FTA also has an unofficial rule, only one line at a time. This prevents a build-up of local expertise.

Despite this, a good majority of Urban Rail projects come in on or under budget. Fraud is not a major issue.

New Orleans built the Canal Streetcar Line for $150 million (budget $160 million). $20 million for non-recurring expenses so that we could build our own streetcars in-house. 30% for consultants (<10% would have been proper IMHO). TERRIBLY overbuilt in some areas (just right in others). New Orleans RTA swore "Never Again" will they allow themselves to be raped by the consultants. (It is worse if you do not even realize that you have been raped).

Still, much better than places like Phoenix & Charlotte that have never "seen" a light rail system actually operate (from an institutional POV). IMHO, they are getting gold plated, over built but poorly designed light rail lines. I am unsure if they realize that they have been violated.

The French solved this issue with national design standards (standard tram for two dozen cities, in the USA, each city has their own "tweaks" to the design as one example). The French build new tram lines in 3 to 4.5 years from a hand wave (I want a tram from here to there) to ribbon cutting. A new mayor in Lyon built two new tram lines in 3 years, 5 months.

We need to learn to be as quick & efficient as French bureaucrats !

The Canal Streetcar Line opened two months late, $10 million under budget, 5 miles long, 24 streetcars, 28,000 daily pax seemed to be the trend before Katrina. Over twice the "farebox" recovery of the best bus line in New Orleans, might have broken even.

More Later,


The French did it. I cringe every time I see this statement. The big reservation that doomers like myself have towards large utopian minded projects is not whether they can be done technically, but whether they can be done given the political, economic, and social climate for the country being discussed. That is where the rubber meats the road. Attitudes in France are far different than the United States towards public transportation. The unofficial motto of Chicago, “where’s mine?“ is more prevalent. The old apples and oranges comparison

The USA did it too ! :-)

1895 to 1920s was quite the boom !

Little Hope if GWB levels of incompetence continue,


Not only was the country a much differnt one then what it is today so was the world. to put it bluntly the situation has changed.

In *MANY* ways for the better/easier to build Urban Rail.

Advanced technology, experience, MUCH higher GDP, higher population, etc.

OTOH, we have apparently given up the "Can Do' spirit to the French. I am counting on at least SOME of that spirit returning.


I dont know much about railways, which is why I never chip in


In the 19th Century, rail evolved around steam:

Large , bulky engines
Coal in bulk: pulled by the same engine
Water in Bulk: pulled by the same engine
Huge cast iron Wheels.
Casey Jones.
Water tanks
Massive axels
Butch n Sundance

All pulled by one engine.

Seems to me, nowadays, what with light weight construction, offsite engines (electrical power delivered by power stations rather than generated in-situ), Enabling major efficiencies for both light urban rail and long haul.

Without making it my life's work, seems like a modern no-brainer to me.

The only other comment I can make is I used to like train travel. When I was(rarely) in Britain in the late 70's and 80's, it was really nice.

Could be so again.

Here endeth the last ever comment that MUDLOGGER will ever make on rail: It is a civilised no-brainer...

I don't know much either but I have a few questions.

I understand the practical benefits of rail, especially electrification. But mostly as it would apply to a post peak oil world of stable economic conditions and relatively full employment.

As I see it, post peak oil will probably herald the death of consumerism which will take with it, the economy and full employment.

So my questions are.........
Who will benefit from an expanded rail system in a post peak economy?
What business will be requiring more rail transport?
What people will require more rail transport?
Who is going to fund the expansion, refit and maintenance of the new expanded network?
Won't the populace naturally gravitate to easily accessible transport without the transport going to them?

The questions are likely naive but I just can't get those thoughts out of my mind.

It is best to dig the well before you are thirsty.

They are very good questions. Many of the "solutions" appear to not take into account that the employment landscape is going to change dramatically. For instance, without economic growth, how many people are going to be left in the financial services industry? I’m sure a little imagination could come up with others. I believe this is what scares the cubicle monkeys so much, and why they latch on to technical fixes that will keep their world going - knowing that a declining economy will eliminate their formerly safe jobs. So who is going to be using these fancy trains when the Merrill Lynch building will be used for something else? The walkable neighborhood envisioned by some could just as easily be a street scene out of “Bladerunner”.

The whole concept of a service economy is going to fall on its behind with spine fusing speed. You either have to make something, or work on the support system for the place that makes something, or you learn to knit.

I believe that is correct Cowtipper. Unless some of those buildings housing these defunct businesses can be reorganized to contain smaller ones - I’ve seen this done to old warehouses in Chicago in the seventies and early eighties when there was an exodus of industry, but it never did match the previous tax base and employment - there are going to be some empty buildings. Might be a good opportunity for squatting.

I hate to even bring it up, but 9/11's effect on lower Manhattan is a picture perfect model of what will happen to financial districts everywhere.

The mortgage scam will let go over three quarters rather than three quarters of an hour, but massive white collar employment will be taken out, just like when the World Trade Center was destroyed.

The facility itself supported about 50,000 jobs but a quick Google and a little PDF reading shows a much broader effect and lasting effect that just the loss of the building complex. I read through the one listed at the bottom of this post and I find that from Q1 2001 to Q1 2004 Manhattan lost 150,000 IT, finance and insurance, real estate, professional & technical, management, and support & admin jobs.

Along with the 150,000 white collar jobs I see there are 2,000 fewer restaurant positions and 8,000 fewer construction jobs.

Many of the jobs that were there were destroyed, mine along with them, but the vast majority of larger companies in the area simply decamped for safer territory. There won't be any safe territory in the first two quarters of 2008 and the effects will linger, neatly blending into peak oil demand destruction.

When I was in Manhattan for the clean up Tribeca was a ghost town - streets that had been filled with people the last time I was there were deserted, power lines were still between little berms made of asphalt with wooden covers, and all of the little shops were closed.

This is the fate of most of "service America" as the mortgage scam lets go under a good administration. We're under the worst administration we've ever seen and if something doesn't happen in that area Real Soon Now we may very well end up looking like extras in A Dog and his Boy. Our commercial real estate stands up tall and isn't very well laid out for manufacturing nor is it very energy efficient. We'll see how much of it gets recycled vs. how much is simply stripped and left to rot in place.


If there are new people getting on board, this thread from TOD is a great place to start:

Sacred, you just summarized the 'Produce' part of ELP!

I am satisfied that a rail system has value under almost any scenario. In Cambodia and Liberia, the rails were used by homemade "railcars" (and preserved by the people from scrap dealers in Liberia per an eMail I got). Will we get worse than Cambodia & Liberia ?

In a doomer world, I can see the need to keep the railroad going as a central organizing force to preserve social order.

In the shorter term, there is a LOT of growth for RRs just from switching freight that currently goes by truck, even if the total volume of freight drops by a third and some growth if freight volume drops by half (see Great Depression).

(Some 2002 #s - RRs 27.8% of total ton-miles (40% of that coal, much of the rest bulk freight) Trucks 32.1% of total inter-city ton-miles) LOTS of growth for container trains is possible. The travel patterns for containers are different than for coal & grain.

TOD is the population moving to clusters around available transit. Roughly 30% (per collection of polls by L. Aurbach) want to live in TOD, less than 2% do because of a severe lack of "T".

As to who benefits, I will refer to the Millennium Institute T21 model runs. The largest economy AND lowest oil consumption AND lowest greenhouse gas emissions came fro ma combination of my electrification of transportation via rail (not enough time, etc. to model increased bicycle use) PLUS a maximum push for renewable energy.

Now, who benefits from a bigger GDP, lowest oil use, and lowest GHG ?

As to means to fund and implement these improvements, I have some ideas but have not yet widely publicized them.

Best Hopes,


bruce from chicago raises a completely valid point.
No one knows how a post peak society will reconstitute.
Large urban areas are the most entropic expressions of modern day life, it is likely they will quickly depopulate.
What use will urban transit be then?

HI all,,,,I don't post much unless I think it may contribute in a critical way,,,,,as the oil supply shrinks and supply's begin to get interruped,,,,rail is going to be needed to connect the major food farm supplyers to the populated citys,,,,diesel is not going to be an option,,,and trucks cannot go without it??? why not do what must be done first and not worry about providing transportation for jobs that may turn to vapor at any time now

When diesel grows scarce it is directed to defense usage first and farming and transport in equal measures second. Despite peak oil we still produce a third of what we need domestically and that'll go into tanks, Bradleys, tractors, and combines ... I just hope we can extract our collective head from our collective hindquarters on foreign policy before the Bush administration drags us into the next two hundred year scuffle over the so called "Holy Land".

And have a look - rail already runs where the food is grown:


When I was(rarely) in Britain in the late 70's and 80's, it was really nice.

Could be so again.

It still is, it's all electric where I live, I can be in central London in an hour, for less money than the congestion charge (let alone parking fees) and in half the time, comfortable and relaxed too. I can recommend 1st class on Eurostar to Brussels or Paris as well ... the only way to travel!

But then, fortunately London is where I normally want to go and I am able to travel off peak.

At the moment, for anywhere else, Intercity is completely useless ... massively time consuming, as is all peak time public transport in my experience, as well as crowded and hugely expensive ... if there is more than one person travelling you don't use the train because of cost ... if you're going long distance the plane is cheaper and quicker too.

But all this may pass ... I suspect we in OECD countries are eventually going back to how things were in my grand parents days (and how it still is for 4/5 of the world's population?) ... much less GDP, much less income per person, much less fossil fuel, few cars (6,000,000,000 people in the world don't have a car even now!), busses, trains, aeroplanes ... no hot & cold running water (more than 1,000,000,000 people still don't have access to clean water, let alone from a tap!), central heating, or food from far away etc. etc.


tech: unless your talking mag lev it's still the same old tech.

experence: NO we do not have the manufactuing experence we used too or have you been under a rock for the past few decades as everything got moved to cheaper labor markets and factorys torn down for strip malls.

gdp: in the 1920's and 1930's the united states dollar was backed by gold. todays dollar and thus gdp is fiat and worth less then 3 cents compared to the gold backed dollar.

Higher population: This works against you. to put it in simple terms. more people means bigger and more citys, which in turn means much more rail, trams, stations, etc.

The french: it was not their 'can do' spirit that gifted them with a debatebly better system. what gave it to them was called foresight. forsight that we lacked which caused us to waste resources in a dead end infrastruture.

Your plan on the other hand is neither uniqe nor will it solve what is so commonly and falsely refered to as a 'problem' here. depeletion of our natural resources won't sit idly by while people try your little pet project, it will keep marching on year by year as each of the above realitys eat into you plan. In the end i would be surprised if we would at least end up in the same spot that we are right now, a hair's breath above failure point.

I will give you this much though, rail /should/ of been where we spent the resources. Though hind sight is always 20/20.

Tech: You have *NO* concept of 1900 technology !!

Coal was a primary energy source. One source says a miner, at the face, averaged 1.5 tons/12 hour day. Another says 5 tons for two miners "was a good day" in 1909.


Add labor to haul to the surface (18% of coal used in UK in 1913, Peak Coal, was used in mining coal per stat quoted here), labor to sort, labor to load, labor and coal to carry coal to steel mill, etc.

40 to 45 tons/day for all labor (including office) is more typical of today (Heading Out surely has better stats).

In New Orleans we have an 1897 work streetcar, a 1912 "hanger queen", 35 1923/24 streetcars, 7 1991/2 streetcars and 24 2003/4 streetcars (later ones built as improved versions of 1923 models). There is a DRAMATIC improvement in design from 1897 to 1912 to 1923 ! Substantial improvements from 1923 to 2004 (air conditioning is nice :-) but not as great as 1897 to 1923 !

We have MUCH better metallurgy, switches, backhoes & bobcats vs. shovels. Hydraulic jacks vs. pry bars (BIG delta !) TBMs versus primitive drill and blast for tunnels.

Transport me back to 1908, just about Peak Streetcar, with modern tech and I could cut construction costs by half to 2/3rds (if not more). Just leave modern consultants behind :-)


The French can build new tram lines from 3 to 4.5 years (one at least took 5 years) from a decision to build to opening.

And at 20 to 25 million euros/km. Even at today's exchange rate that looks good. (Remember the French take August off (paid), 36 hour workweek, etc.). At a "comparable cost" exchange rate I think it would look even better.

NO ARGUMENT that French public policy has been much more foresighted than the USA.

Best Hopes for Becoming as efficient (and as far sighted) as French Bureaucrats,


Posters on this site have noted that French bureaucrats are obnoxious, arrogant, and very COMPETANT. These bureaucrats usually hold these jobs for life. They are usually the best in their class trained at the best universities. American bureaucrats? On the state and municipal level they are political hacks who are connected or related to the politicians (I can tell you some stories about getting building permits in Chicago). Affirmative action has made an even worse mess of things. On the Federal level not much better. In both the employees are protected by labor unions and rules that almost make it impossible to fire anyone. Moreover, with the changing of every administration more political hacks are installed and the heads of departments are rarely the best in their field. The Bush administration has taken this to new levels in industry bias and ideological enforcement. So this is what we have to work with. An incompetent bureaucracy that is impossible to fire and beholden to the current administration whatever flavor that might be. Nice.

I understand that they typically retire at age 60 (anyone French can confirm ?).

Perhaps we could offer them a second career over here ? To show us Amis how things should be done ?

The feared shortage of sarconal after January, 2009 could surely be averted with such a program.

Best Hopes for zero lynchings,


USA 1910 GDP ADJUSTED FOR INFLATION was a bit less than 4% of USA 2006 GDP.

We ARE richer today. We have more capital goods & resources.

See 1900 coal prodcution #s vs. today. Same in MANY sectors of the economy.

Best Hopes,


How much of that present GDP was attributable to the inflated and fraudulant housing and mortgage industry? Richer? Whom? The top percentage? Alan, you must have nothing but friends in high places, because in my blue collar world no one doing better.

Compared to 1910. the average American working man is MUCH richer and better off ! Yes, the last twenty years have been "treading water", if that. But 70 of the 80 years before that saw massive improvements by almost every measure.


"to put it bluntly the situation has changed"

TK, truer words were never spoken.

I work for a Dept of Transportation in a midwestern state that shall not be named. In the hallway outside my office sits a row of olive drab file cabinets labeled "Railroad Abandonment Project".
The files date from the early 60's to the 80's, and catalogue the systematic dismantling of the RR system that someday soon must be rebuilt if the U.S. economy is to survive in any meaningful form. How could so many people in positions of power and influence have been so blind?

Meanwhile I spend my days helping plan roads that won't be needed that we can't afford to build.....


Iowa has a tidy rail abandonment history online, complete with nice maps.


Man, I thought my job sucked! :)

Here in Michigan a rail line from Standish to Gaylord was converted this summer to a snowmobile trail!
In recent years, Mid Michigan has hardly any snowpack.

The new line from Boston to Scituate which is opening today, cost double the estimates. (Per the news last night) They are also saying it is going to cost $20 per person for the next 20 years to pay for it.

$512 million for 17 miles. Total Boondoggle.

I am still pro-rail however. I just can't stand the MBTA.


A big part of that cost over-run is one little village would not allow an at-grade crossing (over an old railbed, unused for a dozen or so years) through the center of their town.

It became the "Little Dig". The roof was being used for a dumpster and some parking when I toured the Greenbush line after ASPO-Boston last year. And instead of a station in the middle of the village, it is on the edge.

First quality construction (even granite curbs at new bridges and stations !) that should last 100+ years with minimal maintenance.

This was done 100% with state $. The R's push commuter rail, the D's Subways & the Big Dig in MA I heard. The "T" does have a bad rep, I am afraid.


Portland's first commuter rail line (feeds into Light Rail on "other side of mountain") is on budget AFAIK for $117 million, 14.7 miles, 3 to 4,000 daily riders. Opens Fall 2008.


Hi Alan,

I wish I could speak French fluently as speaking French seems to make more sense than speaking English.(I guess that statement leaves me open to a certain amount of abuse:))

On your mention of France, here is some old news:

JACQUES CHIRAC, the French President, has stolen a march on Tony Blair’s proposed energy review by pledging that no train in his country would be powered by conventional fossil fuels by 2026.


You have previously stated that nuclear should be developed slowly. I don't understand this reluctance to be more enthusiastic about nuclear power for your electrified rail. I hope you looked at that recent article about Lovelock in The Rolling Stone.I realize a transition time is needed but there is little if any time left. Do you expect the electric for rail to come from new coal fired power plants or....?

Along the nuclear vein, have you looked to the use of nuclear/alt energy hydrogen for rail, rather than diesel where electric would be impractical?

Today, 0.19% of US electricity is used for transportation. That would be Amtrak's Northeast Corridor, Long Island RR, NYC subways, subways in DC, BART is SF, Chicago, Boston, Philly, Atlanta, LA (one), Miami (one), Light Rail everywhere we have it now.

Increase Urban Rail demand twenty-fold (2000%) and we are talking about less than 4% of US electricity.

Moving 100% of today's intercity freight by electrified rail has an upper bound of 6% of US electricity (Likely <5%)

Reaching either of these goals is a 15 year project in my rosiest fantasies (and to do either in just 15 years is a fantasy IMHO). 25 years in my 2034 retrospective. Conservation, wind, nuclear (even under a go slow program that I advocate) perhaps solar can each provide this much in 25 years and probably 15 years.

where electric would be impractical ?

France thinks that 100% can be electrified (perhaps battery locos on some short spurs, Yes I remember the New Year Day's message to the nation :-). Switzerland is 100% electrified except a tourist line. The Trans-Siberian is electrified.

I am not sure just where "electric would be impractical". If so, it would be small and short and a trivial use of diesel.

Best Hopes,


Electrical from wind for rail seems to me to be a no brainer for the Breadbasket .

We grow grain here:

And we have class 3 wind pretty much throughout the western half of the region and the eastern portion may make sense, too, if developed with large towers.


The common locomotives I see around here are 4,400 horsepower GE models. 4,400 horsepower * 756 watts/HP is 3.3 megawatts ... or two of these guys with a little room to spare:

wind turbine

When the trains aren't running the turbines can power the communities along the rail lines. Agriculture, population, and the local manufacturing we need will grow along the tracks, just like they first did in Iowa a century ago when rail first penetrated the region.

3.3 megawatts ... or two of these guys with a little room to spare:

You are using the faceplace value and not the normal production value.

Locomotives also do not operate at full load at all times. Electric locomotives feed back into the grid when braking.

Wind Turbines at 32% of nameplate (average). I strongly suspect that locomotives average that or a bit less (LOTS of variables). It does not take that much power to keep a train going at a constant speed on flat ground once it gets rolling. Locomotives are sized for peak and not average loads.

Best Hopes,


Thanks Alan,

I have no problem with your aim to put us on track, it's the only civilized way to go. But that is only part of the solution to the problem of CO2. (It is not Peak Oil that is the problem it is oil that is the problem,at least a good part of it)

Pulled this up some place --United States 20,030,000bbl/d Petroleum consumption. You would know the percentage of that used in transportation better than I but is this what your 6% of US electrical would replace? Not I guess unless Locomotive can fly, eh?

I think we have to look at ways to replace CO2 fuels with those that don't produce CO2 and this means Nuclear as fast as can be, for electrical ground transport and again, energy for hydrogen production to replace kerosene.

I think we are toast but I gave up a 20 year 3 pack a day cigarette habit 20 years ago so I figure anything could be possible.

Keep up the good work but for god sake look dour while you are at it. Dispair is our only hope.

Best wishes for a swift and furious depression to scare the S out of one and all.

"Despair is our only hope" -CrystalRadio

I think we have a motto for this new century of ours.

Not I guess unless Locomotive can fly, eh?

My vision of 2034 is a mix of strategies.

Round #s, transportation is 2/3rds of US Oil use. My electrical use calcs would do more than "replace" oil powered transportation, it would eliminate much of it.

I had a third of Americans living in TOD by 2034 (and a quarter more wanting in). Their oil demand would drop dramatically.

Bicycles (including e-Bikes) would be the default mode for many more. Add NEVs and "real EVs". And some gasoline would be burned in 100 to 125 mpg PHEVs. Plus very small diesels.

Add largely electrified mass transit. And people just traveling a lot less (perhaps back to 1950 levels ?). Note my 2034 vision had more fuel efficient a/c traveling directly from hub to hub (and flying slower) with rail serving the hubs.

In non-transportation oil, I mention replacing oil heat with ground loop heat pumps (or air source heat pumps with natural gas for colder weather).

I assume, but did not state, that disposable plastic use has almost disappeared (remember recyclable glass soft drink bottles ?)

Automobiles also consumed a lot of non-transportation oil use (plastics when built, lubricants, antifreeze, synthetic rubber for tires). These uses will not disappear (bicycles use a small bit of rubber) but diminish significantly.

We can still do a *LOT* with 6.6 million b/day. This is just a slight reduction per capita from the most fuel efficient OECD nations.

Best Hopes,


If you are going to join my sect you must have proper tipped rail car graphics to post when occasion demands it. I have a few to get you started ... and no irony intended, but that black stuff on the ground is powder river basin coal.


My I join? I could be "SacredWolfTipper", or SWT. You know, sweat, as in all the farm labor I may find myself doing in upcoming years... (or Standard Widget Toolkit, or Southwest Trains, or...) I could be the tipper of that much feared wolf-in-sheep's-clothing. Or, tipping the wolf-at-the-door. I can just tip 'em all. Thing is, if I give them too much, I'll go broke. ;o)


graywulffe in CVO, OR

A "sacred rail car tipper" would mention the obvious point that while everyone lobbies for federal giveaways, "light rail" is one of the code words to direct federal money into the inner cities.

Next thing you know, in the near future, the Europeans will take a look at the US system. LOL.

See the Nine Nations of North America for details.

With WY and NE in the Empty Quarter and Bread Basket,

Alliance v MexAmerica, Ecotopia and New England, Rust Belt.

Arkansaw of Samuel L Clemens

The real case for inter-urban passenger rail is not a national case, but a regional case. Passenger rail between NOLA/Atlanta, Atlanta/Charlotte, Charlotte/Raleigh, and Raleigh/DC is not going to benefit the USA as a whole nearly as much as it is going to benefit the southeast (or "Dixie" to use your Nine Nations of North America paradigm - a good book, btw). One benefit of getting away from the idea of a national system with a few long-haul lines toward regional systems with shorter inter-urban lines is that we can achieve a better match between costs and benefits. This requires that the federal government become genuinely helpful, which requires that it bring the states and cities within regions together and facilitates the building and regional funding of these regional networks, and otherwise just gets out of the way.

If the folks in the cities switch from driving alone in their cars to riding on buses, trolleys, subways or other fixed transit options, there will be more oil left over for the farmers (and everyone else) outside the cities. Otherwise, as the price of oil can be expected to continue to climb, the farmers will likely go bankrupt along with the rest of US.

E. Swanson

The farmers will get all the diesel they need.

Just like in 79 and 74.

And the Home Financing Bankruptcies will happen faster
than Farm Bankruptcies.

Arkansaw of Samuel L Clemens

North Dakota has lines for diesel now ... that only has to hit about one other state before the legislative relief begins. I look for that to be in place by next spring given the conditions we're seeing.

It is hard to swallow public financing for rail projects in selected cities. Smells like pork to me.

But then most voters, which benefit from urban rail, have a hard time with the farm bill. I like the old idea of small private streeetcar companies and rail lines, but realize that's hard in today's regulatory morass. Why not look into a RID-regional improvement district to try to finance these?

I'd like to see the freight system upgraded and expanded, sometimes. Then I recall the "good old days" when crops started to rot on the rail siding waiting for a rail car to free up. Seemed farmers were always fighting the RR's. Governors got elected on that. Then there was the cost issue, with rates jacked way up. Every time grain would go up a nickel, rates rise a dime. Or seemingly in transit, so margins were wiped out by shipping.

There's a reason folks started driving their grain over the Bitteroot mountains, from Montana to Washington's river barges.

"Selected cities" should eventually include almost every city. The French have just 5 towns of 100,000+ population without a tram or plans for one. Add electrified rail lines (just electrifying adds about 15% to capacity) and there could be something for most everyone.

Add indirect benefits (see Iraq & GW & larger GDP), and everyone will benefit !

Best Hopes,


Then I recall the "good old days" when crops started to rot on the rail siding waiting for a rail car to free up.

Happens today. Colorado has a bumper crop of wheat this year and the RRs are unable to provide a sufficient number of rail cars to move it.

Because the high-paying jobs are in the urban areas so they can outbid the surprisingly poor Red-Staters for gasoline. And any extra that they pay for gas is money not going to buy corn or beef.

He buys most of his food at the same place you do.He might still be able to get his steak for 4.99 a pound but you might have to pay 15.99.

What we need is not so much an expanded Amtrak as a different Amtrak. For example, instead of the Crescent between NOLA & DC, we need more frequent short runs - for example, NOLA/Atlanta, Atlanta/Charlotte, Charlotte/Raleigh (we've got that one), Raleigh/DC. Rather than sleeping overnight on the train, one might have to sleep overnight at a "station hotel" at one of the nodes. It might thus take a little longer for a DC/NOLA rail trip, but someone traveling that far in a hurry is going to take the plane anyway. The advantage is in running two or three trains per day between nodes, at reasonable daytime hours, instead of one train per day passing through some of the nodes in the middle of the night.

Once the long haul routes have been broken into these smaller runs, then new routes need to fan out from these nodes in a hub & spoke pattern. It is these shorter routes where the real passenger traffic is to be found - routes that would not take much longer to travel by rail from city-center to city-center than what the total trip time would be by air (including terminal and ground transport time). These hub and spokes could in some cases for the backbones around which metro mass transit systems could build (like Paris Metro vs. RPR, or they could be different systems (like Paris Metro/RPR vs SCNF).

The problem is that right now we're just treading water with Amtrak, not really moving forward toward any type of rational long-term goal.

Amtrak is very frustrating to me - 180 mile drive to the nearest terminal, then many hours of riding to get to Salt Lake, then an eight hour bus ride to get to Las Vegas. This is using the Zephyr.

If I take the southern route I have to drive 180 miles, then ride for many hours east to Illinois, change trains to the Southwest Chief, and then hop a bus in Needles for the 100 mile run to Las Vegas.

I would think the folks in L.V. would get real interested in a spur line with service from Needles into the city.

The regional hub stuff is the right way to do it - we have that now for freight and there is a strong correlation between rail access and community economic health, at least here in Iowa:


But passenger service? Things don't look so hot on that front ...

two abandoned passenger cars

I have an Amtrak station 12 miles from my house, with free parking to boot, and I would love to take it on my commutes to Chicago. But with delays often running up to two hours it is not worth it.

The old reply "You can't get there from here" comes back.

Amtrak's biggest problem as I see it is poor service on existing routes. Big problem of solely late night arrival/departure on so many cross country routes could be solved with another train 12 hours later. It's just too much trouble to get off the train in the middle of the night, then drive another 150 miles home. Might as well do that drive in the daylight and get on a plane. Catch 22-more trains=more riders, but too few riders for more trains.

But even with that, it's hard to minimize the service the train provides across N. Dakota and Montana for local trips. It's the only game for many small towns. When the Empire Builder was looking to be slashed several years back, Senator Baucus spent quite a bit of political capital restoring it. 'Course it wasn't seen as pork, just getting what was due...

The Empire Builder is a must for people in that arc from Washington to Minnesota, who often have long distances to drive and high prices to pay for air service.

I wish I were closer to a station ... three hours by car from here.

The Transit Planning Board (yet another planning agency with little power) for Georgia has released their preliminary rail plan. There is no money attached and nothing really new that hasn't been in past plans from other agencies, but I thought you'd still be interested:


High oil prices are good for the economy !

Just ask Yergin !


Love his "demand shock" explanation !

And "the market expects each [integrated oil] company's profits to fall, for which the only plausible explanation would be declining oil prices".

Best Hopes for CERA comedy :-)


At what price do we hit 3 Yergins?

one yergin = $38 USD/barrel
two yergins = $76 USD/barrel [2 X $38]
3 yergins = $114 USD/barrel [3 X $38]

Metric yergins [Yg]?

1 decayergin [daYg] = $2400 per Kiloliter ($380/bbl)?

Today, the front-month contract went up around 109 microyergins [μYg] (3.8c/bbl)

Jaymax (cornucomer-doomopian)

heh i like the halloween pic Leanan. Did you make it yourself?


And why do you have "Lianan 2007" on one tombstone?

I understand the fresh grave for "CERA", but not the other one.

Maybe it's the cornocopian part of her.

Yup. I'm in the cornucopian cemetery for sure. I'm not 100% convinced that peak oil is now, but I know the black stuff isn't going to last forever. Or even to 2040 like the gubmint says.

Leanan, I assume you sold your entire stock portfolio?

It's just my sig. 3D artists often try to make their signatures look like part of the image.

(Yes, I did the pic. One of my many skills that will likely be useless in the post-carbon age. ;-)

One question only:

Will there be enough realists / doomers to go around burying the remains of the Cornucopeans?

Why bury them when they make a good roast or stew?

Mr. McGuire: I want to say one word to you. Just one word.
Benjamin: Yes, sir.
Mr. McGuire: Are you listening?
Benjamin: Yes, I am.
Mr. McGuire: Cannibalism.
Benjamin: Just how do you mean that, sir?

Brings new meaning to way he is eying that leg.

We'll be dismembering their corpses and burying them shallow; bones are a good source of phosphorus.

This seems to lend credence to the suspicion that Doomers believe their pessimism will somehow improve their survival chances, and not instead become a self-fulfilling prophesy for themselves as well as others..

To dis Eleanor Roosevelt's line (Or is it QEII?)
"It takes as much energy to Scream as it does to plan."

- or to extend the idea, I suspect that there are some Cornucopians out there who are actually preparing for energy disruptions, like that industrious little ant.. "Anyone knows an Ant Can't - build an Ethanol Plant, but he's got..." etc, etc..

Happy Halloween!


I think you're confused as to who is doing the screaming or planning. Excuse me for a while as I harvest my crop of Georgia Jet sweet potatoes. Nice and tasty.

I'm not saying doomers AREN'T planning and preparing, just that many people with other philosophies are doing so also, and there's this tone that suggests 'Pessimism=Realism' and that by predicting the darkest outcome is some kind of safetynet against the dangers that are looming, like 'duck and cover' shields you from 'the flash'.. There are real precautions.. and there are dark and brooding attitudes that sometimes seem to act like standins for actual precautionary measures.

'When running rapids, look at the water-flows where you WANT to be going, NOT at the rocks you want to avoid. Focusing on the rocks can have the effect of drawing you into them..'
Old Canoeing advice..


ps; Screaming? There's screaming on all sides. It seems to be a ~little~ quieter in here..

'When running rapids, look at the water-flows where you WANT to be going, NOT at the rocks you want to avoid. Focusing on the rocks can have the effect of drawing you into them..'

That could easily be turned around:

Doomers tend to be planning for something approaching self-sufficiency, where they increasingly realise they want to be going in any event, the 'safe' route.

Cornucopians tend to be focussing on the things that'll squeeze us past peak-oil - be it alternatives or whatever. Things driven into existence by peak-oil, ie: navigating the turbulent bits.

Dunno... I'm hardly a hardcore Doomer, but I've started planning down the self-sufficiency route - I've found focusing on the smooth flows is a lot less stressful than when I was more optimistic about the next couple of decades.

Jaymax (cornucomer-doomopian)

"Doomers tend to be planning for something approaching self-sufficiency.."

and THAT is the assumption that I'm not so sure about.. are they? (we, really .. I'm somewhere in the middle.. Little Hammer, Big Rock, 'Ting, Ting, Ting')

Ahhg.. the labels are killing us!.. (and I know, I started it!) I mean, the glass that is half empty is ALSO half full.. neither statement is any more true than the other,.. and if that devolves into the bicker over whether it's MORE empty or full.. well that's more about the victory of argument over actual work. Which is what I'm going back to do..


The glass is 100% full.

Full of water and air - in normal room conditions

Actually, in my experience, the 'glass' has usually been over specified to at least twice that is required, by some middle manager who's scared to buy a glass that's too small, and much too scared to admit they don't know what size of glass to buy or to ask a person that knows what to buy!


"Its not the size of the glass, its how much water is in it."

I'm just hoping (I hate that word) that the others' planning doesn't eventually involve taking my land to feed the masses and shuffling me off to some interment camp. Yes, this is usually how utopian plans end up - badly. When the planners realize they cannot enact their vision by persuasion they do so by force. History does rhyme

"Yes, this is usually how utopian plans end up - badly."

A Doomer mantra if ever there was one! Some links, please?

"Forget the power of positive thinking, it just doesn't work, and never will!"


"A Problem that was created using intelligence will not be solved using stupidity."


You've never heard of communism?

You should be more accurate. if your refering to what the soviets did then it's totalarinism, not comunism.

Yeah, the communists in college always loved to say "but it was Stalin and Mao that distorted communism!". Yeah, right. So why did no one else make it work? That type of corruption was inherent in the scheme.

It has yet to be proven that anyone has made capitalism work, in the long run.

However, it could easily be proven that capitalism has made me work.

I would say that the Swiss have.


Because on the nation state level neither communism nor capitalism can exist. Too many layers of abstraction between the leaders and the rest to prevent corruption/cronyism leading to fasism(like what has happened here in the u.s.) or totalitarianism/one party dictatorship like what has happened in both russia and china.

But thats besides the point, if you want to give good examples you need to make sure they are accurate.

So if not a nation state level, what are you talking about a tribe in New Guinea?

It seems to me that there are the doers and the procrastinators, the leaders and the followers, the libertarians and the liberals, the socialists and the capitalists, the victims and the responsible, the stupid and the intellectuals in equal measures on both the doomer and cornucopian sides.

I said recently that the only thing that had moved me from cornucopian optimism was the understanding that came with time - I'm sure I'm still the same person.

As with any movement, it's the really annoying or stupid things a few people say or do that stick - just cos a few doomers might spout this kind of nonsense, doesn't make it typical of most. If you want real solid proof of that, go watch "What a Way to Go: Life at the End of Empire"

It's the very epitome of doomerism, and yet a stronger message of hope -- of fundamental belief that, despite all that doom, there is something to fight for, to hope for, to build for -- you'll be hard pressed to find.
Jaymax (cornucomer-doomopian)

Leanan - I just want to thank you for all your efforts in making drumbeat such an important part of my day.

Reading your occasional comments I come to believe you are the Queen Doomer, (I can picture you in your Elvira costume typing away at the keys... oops did I write that out loud?) but you express yourself with such intelligence it never seems to go over the top.

Some day I would like to see a feature post of your summation of the situation based on your unique perspective.

Cheers all

“Halloween is one of the liminal times of the year when spirits can make contact with the physical world” OOOOoooooooOOOOOO


Arkansaw of Samuel L Clemens

Looks like the energy problem in the UK just got worse:

Explosion reports at oil refinery

Emergency services are at the scene of a fire at an oil refinery in Essex amid reports of an explosion.

Crews were called to the Petroplus Coryton refinery, near Stanford le Hope, at about 1130 GMT.

Essex Fire Service said the fire was on the ground floor of a tower and flames were 100ft (30.5m) up a column.

"The Swiss oil company Petroplus brought the Coryton Refinery from BP in May 2007."

Good move BP!

Now if we can just get Thunderhorse up and running.

Arkansaw of Samuel L Clemens

Fellow Brits:Time to fill your tanks...

Close to the M25, the Coryton site is responsible for loading about 700 tankers a day to meet 22% of the UK's forecourt demand.

deleteted as already a link above.


Is it considered NeoLiberalism to outsource/offshore your institutionally-miserable maintenance standards? (IMMS)

I have to chuckle at the story above about power cuts in the UK this winter:


Since our clueless leaders have been badgering joe public to replace their central heating boilers for about 10 years [with data helpfully provided by the people who make boilers..], there is now a large proportion of boilers with gimmicky electronics instead of simple piezo spark lighters.

So any loss of power and [x] proportion of houses wil have no heating either. Gas cookers have done the same. How many non smokers keep a box of matches???


You spotted the critical point failure in the system.

Fotunately we kept our old boiler :-)

We will still freeze in the dark mind, just wont be blown up when the system kicks back on.

And we just bought a cheap 1000w Gas Generator, just to keep our Oil Furnace and Freezer running, in case of a power outage..

If I really have to practice what I preach, I may just have to quit preaching.

(I'm also building Solar HotAir panels, installing PV, etc.. but there's not enough installed to keep the pipes unfrozen yet..)


How many non smokers keep a box of matches???

IME, a lot. The reason? Candles. Candles are insanely popular (at least on this side of the pond). Everyone and her sister has gone crazy over decorative scented candles.

Every year when the Clocks go back, we have had an annual 'end of the world ' ritual. Since before even PO came on the radar since Winters in NE Scotland can , on occassion turn nasty:

Cans and Dried Goods

We now have a very nice selection of:
Propane Gas Bottles (we have cooked xmas lunch on barbeques twice in the last 15 years).
Storm lamps.

Oh how they laughed...

Some time soon I suppose we will have a mad-max weekend of Cross bows, Razor edged boomerangs and fetish-gear :-)

One of the handiest things I have found was those propane torches with integral piezo lighter ( Bernz-o-matic model TS4000 )

I got mine at WalMart for about $40 a couple years ago.

Although it was designed for soldering copper pipe, I use it routinely as a barbeque lighter. It comes in really handy for searing a steak to perfection.

The fuel tanks are robust and plentiful. Refills are easy to come by as it uses the same propane fuel as camping supplies. Its made really nice.

If you are really into the doomsday scenario, you can get the hoses to refill the disposable tanks from a 5 gallon "barbeque bottle" tank, or even a big "propane hog".

As long as I have that thing, I know I won't want for a method of getting a fire started, or be concerned about having some dry tinder. If it will burn, this torch will ignite it.

As for lighting, I love those new LED flashlights.

I have some of the aluminum "mini-maglite" that run on 2 AA batteries, solar cell charger, a dozen AA NiMh cells, and three dozen Lithium Energizer AA hid in the closet if we get the "Big One" earthquake in the Los Angeles area.

I have more lithium than I need because I can probably do just fine if I find sunlight. The lithiums will most be likely used as stock in trade. What I find so appealing about the lithium cells is their shelf life and energy density, albeit they were not cheap.

Another advantage is that I have yet to see a lithium cell leak. It is so frustrating to open up a hard to replace electronic gizmo, such as a remote control or piece of test equipment, after years of trouble free service, only to find out the battery has ruptured and its electrolyte has ruined the innards of the gizmo.


Warning: Lithium batteries can burn out LEDs - and other things for that matter.

The lithium chemistry has a higher per-cell voltage and can overvoltage the things you put them in. Standard alkaline batteries are around 1.5 volts per cell, where as lithium can be around 3.6 volts per cell. This depends on the sophistication of what you put it in but many of these little lights don't have voltage regulation.

I think it was yesterday I saw something about the Government in the UK granting EDF permission to build a new gas-fired power station. Old habits die hard.

Britain's grim outlook regarding energy was one of the reasons I left. I also noticed in the article this:

There has also been uncertainty over the amount of gas coming into the market this winter from Norway's Ormen Lange field in the North Sea. The Langeled pipeline linking the field with an import plant at Easington, east Yorkshire, was opened last year and is taking some gas but it is unclear when it will be at full capacity

What's going on with Norwegian gas? This particular problem has been reoccurring all summer with volumes in the Langeled pipeline falling by some 70% at times.

Who cares if you have a match...without electricity you will freeze if you have forced air systems. (radiant should still be moderately functional - depending on design.)

No electricity, no fans to move the air or vent your furnace...deadly combo.

And worse yet most housing in newer (last 20 or so) are zoned so that you probably, don't, and couldn't have a wood fireplace as back up.


Our new gas stove is set up just that way.

The old stove, we lit with Bic's.

This one has electronics in the way.

I'm looking to circumvent it.

The top burners can be lit with lighters, however.

Arkansaw of Samuel L Clemens

Common Sense Forecaster: $100/barrel For Oil Is Not a Stopping Point

A top official at the Energy Department disputed OPEC's claim that supply isn't an immediate challenge. "We think the market still needs more barrels, as we look toward the next year or so," said Guy Caruso, an administrator at the department's Energy Information Administration. "The problem is we don't have cushions," in terms of spare production capacity and spare crude stocks, he said. "We have relatively low and declining inventories and a refining sector that's finding it hard to get the crude it needs."

This last sentence is counter to what Robert has been saying.

Interesting. Wasn't the EIA blaming "refinery bottlenecks" only a few months ago?

This last sentence is counter to what Robert has been saying.

All due respect to Mr. Caruso, but I guarantee you that I am closer to the refining situation than he is. I already have a TWIP in the queue (it's been on my blog for a couple of hours, and I will update when the numbers come in), and as I point out, the EIA has a pretty crappy track record about these things. Back in August, they were predicting prices to fall, just as they rose 30%.

The inventories he is talking about are worldwide, but the only place that inventories are really low is in Europe. I pulled up some stats in a comment on my blog a couple of days ago for EIA analyst Doug MacIntyre, who said the same thing:


Robert, inventories have gotten quite a bit tighter since that report.

But I hope by now that you have returned to your kids and are finally trick-or-treating.

"Sinopec has raised imports and refining in November, and analysts expect it will get another tranche of cash from the government at the end of this year to offset its losses. Beijing gave it $1.2 billion in 2005 and $640 million in 2006.

An industry source said Sinopec had bought another 30,000 tonnes of diesel for import in November to the hardest-hit southeastern coastal areas. And it will boost refinery runs by 800,000 tonnes next month, a company paper said.

But a Sinopec official told Reuters on Tuesday that its largest refinery will switch off a crude unit in November and process 3 percent less crude than the previous month, sending a signal to Beijing in a move that could worsen the shortage.

"It's ridiculous to shut down plants at a time of razor-thin supply," one source remarked. "I guess it's a silent protest for the central government to raise pump prices."

(Additional reporting by Felicia Loo in Singapore and Langi Jiang in Beijing)"

Somebody's lying.

And I think this is happening here as well.

We'll find out in 1/2 an hour.

Arkansaw of Samuel L Clemens

$3 gas "around the corner"? It's been over $3 for weeks here in Seattle. It's around $3.20 now and rose like $0.20 in the space a few days!

Here in Rochester NY, it has been hanging around $2.98/$2.99 for a few weeks. Today I saw $3.03. I expect some of the reason the prices have stayed low is that, as Robert says, the refineries are refraining from buying crude at these high levels and they are selling their inventory. When they are forced to start buying, the price of oil will go even higher, and higher prices for gas will kick in seemingly overnight and seemingly without explanation.

I saw diesel over $4.00 at one station here in the SoCal/Los Angeles area yesterday. (Seems to be averaging $3.35-$3.65 at most places.)

Yup - we have the most stringent pollution laws on the planet right now. I don’t know how long it can last in the face of the "change"

Summary of Weekly Petroleum Data for the Week Ending October 26, 2007

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) fell by 3.9 million barrels compared to the previous week. At 312.7 million barrels, U.S. crude oil inventories are in the upper half of the average range for this time of year. Total motor gasoline inventories increased by 1.3 million barrels last week, and are in the lower half of the average range. Both finished gasoline inventories and gasoline blending components rose last week. Distillate fuel inventories increased by 0.8 million barrels, and are at the upper limit of the average range for this time of year. Propane/propylene inventories increased 0.9 million barrels last week. Total commercial petroleum inventories decreased by 1.1million barrels last week, but are in the upper half of the average range for this time of year.

And here's what was expected:

In its inventory report, the Energy Department's Energy Information Administration is expected, on average, to show oil inventories rose by 100,000 barrels last week, though the estimates of analysts surveyed by Dow Jones Newswires vary widely.

The analysts expect, on average, that refinery activity grew by 0.5 percentage point to 87.6 percent of capacity last week, while gasoline inventories rose by 400,000 barrels and supplies of distillates, which include heating oil and diesel fuel, fell by 1 million barrels.

Did anyone catch this? WOW!!

Refineries operated at 86.2 percent of their operable capacity last week.

Did anyone catch this?

Well, since you asked. I think that I am going to go into lurker mode, and basically respond to questions, with articles posted on Graphoilogy and elsewhere. Edit: Added info about change to Just In Time inventory system, presumably because of the SPR.

Declining Net Oil Exports Versus “Near Record High” Crude Oil Inventories: What is going on?
Posted by Prof. Goose on September 14, 2007 - 8:18am
This is a guest post by Friend of TOD Jeffrey J. Brown

Given this decline in net exports, It’s interesting that we have “near record high” crude oil inventories in the US, based on the five year range of crude oil inventories. In my opinion, the five year range for US crude oil inventories, as an indication of what is going on in oil markets, is highly misleading.

First, the industry has clearly gone to a Just In Time inventory system. In the Eighties, the industry maintained much higher crude oil inventories, especially in terms of Days of Supply, which have fallen to about 21 Days of Supply currently, from about 29 Days of Supply in September, 1982.

Second, we need to evaluate crude oil inventories based on Days of Supply in excess of Minimum Operating Level (MOL). In the US, the MOL for crude oil is probably about 270 million barrels (mb). At about 322 mb, US crude oil inventories are probably best characterized by Hours of Supply in excess of MOL (about 80 hours). In my opinion, recent fluctuations in US crude oil inventories merely reflect minor changes in a thin margin of supply in excess of MOL.

Refiners are unlikely to let their inventories drop below certain critical levels, and given the expectation of declining world oil exports, refiners will have two choices: (1) Bid the price up enough to keep their inventories up and/or (2) Reduce their crude oil input, thus reducing product output.

My contention is that instead of focusing on crude oil inventories, we need to focus on world net exports, crude oil prices, refinery utilization, product prices and product inventories.

I expect to see crude oil exports trending down, crude oil prices trending up, refinery utilization trending down, product prices trending up, and product inventories trending down.

I hope you don't go into lurker mode.

Your opponents seldom return to acknowledge that your insights were correct, but that doesn't mean you aren't appreciated.

I second that. I knew that you catched it.

I hope also that you stay here in non-lurk mode - I am a lurker mostly because of Leann's noise-to-signal argument - I come here to learn, not to make a bunch of noise

your ELM honestly changed my whole lifestyle - I moved within two blocks of my work (and walked for the last year every day), now I'm looking at moving to the non-discretionary side of the economy, I cut down spending - I cut up my credit cards - I turned off my pilot lights for 90% of the year (Santa Monica stays pretty comfortable year-round) - I put in power strips that I turn off all my appliances so they aren't sucking it down - my gas & electric bills are next to nothing these days

there are a few posters that I consider essential to this site - and Westexas you're one of them! - so stick around please...

I think that you meant ELP--hard to keep the acronyms straight.

I'm going to hang around, but after we finish our Net Exports paper, I think that it is basically going to be a process of chronicling the downturn. I would like to post the net exports paper after we cross the $100 mark, assuming that we do it in the next few days.

IMO, the very lifeblood of the world economy--net oil export capacity--is draining away in front of our very eyes, and 99% of the population doesn't have a clue. Alan and I have kicked around the idea of doing some joint presentations, but I think that all we can do at this point is to have a credible plan in place to make things not as bad as they would otherwise have been, when--perhaps if--the majority of Americans realize that we live in a finite world.

Congratulations on your ELP moves. "Cheap is the new chic."

WT...as someone that has been on this site for almost 3 year now...I've come to realize that there will be no organized mitigation in the US. You and I and Alan Drake down in N.O....the folks in Manhattan after 9/11...the folks in San Diego looking at their burned out property...we are pretty much on our own in surviving whatever random disaster strikes...as the system slowly decays...as the empire struggles and chokes and tries to survive. I understand what you are doing. You've made your case...you are convinced (as am I)...PO is here and is crawling into the public awareness.

The time has come to spend less effort on TOD and more effort on getting things prepared while we still can...each in our own personal neighborhoods and lives. Forget about the federal system...it is not coming to the rescue in the end...it does not matter who is at the helm. What matters are local politics, local food sources, local transportation, local social network, local entertainment, local security measures.

Now, more than ever, WT's advice of simplifying ones' life, getting out of debt, etc...is advice that you should have started several years ago. Starting now will soften the blow, but something wicked this way comes...are you ready for it?

I get this image of WT as Bilbo Baggins, right before he slips on the One Right at his birthday party.

Tell us, sir, do you like less than half of us half as well as we deserve?

ELP changed my life as well. It seems to me Westexas has been fighting the hard fight--for all the right reasons. Every time my students ask what they can do during a PO discussion, ELP is the first thing discussed.

For months I’ve been pondering the discussion between Westexas, RR, and Stuart regarding whether or not Saudi Arabia and/or the world has peaked. RR urges us to be cautious about saying the world has peaked, because of how TOD would lose credibility if current peaks are surpassed. Westexas urges people to prepare with ELP because he sees the peak as being immanent.

My thoughts on the matter gelled when RR posted an anonymous quote that suggests Westexas has an unconscious case of confirmation bias. This idea struck me as a red-herring. Westexas is an exploratory geologist who is used to making heuristic analyses before making a decision. As a result, he is more comfortable using heuristics than those who prefer to rationally analyzing further data as it becomes available. Many people at TOD, though, seem to ignore that heuristics has it's place in scientific discussion. As we all know, we use heuristics when there is a dearth of data and time is of the essence. Also, any scientific model is inherently heuristic. The only perfect model is nature itself.

All things being equal, it seems to me the most rational course for charting our way through PO is to use heuristic analyses to determine what we know today about peak—and plan accordingly for the safety of our families. Once we have done what we can for our families, then we can continue to rationally examine incoming data and contribute to society. Perhaps those who are reluctant to state publically that peak is at hand are comfortably assured that their families are safe. Before the crushing tide of history, what practical difference is there in a variance of five or so years when we are discussing the future of our civilization?

For me, at least, the danger of being wrong about saying peak has occurred is far less than the danger of being right. Given that it takes decades to prepare for peak, I’d suggest the same is true not only for my family, but for society as well.

I'll heartily second those thoughts, Ric.

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

RR urges us to be cautious about saying the world has peaked, because of how TOD would lose credibility if current peaks are surpassed. Westexas urges people to prepare with ELP because he sees the peak as being immanent.

Ric, every so often you come on the board and give us your mythological version of events. And when you do, I address them, and yet you later repeat them. The only thing I can guess is that you aren’t reading the responses. So, more for the benefit of those who may be new to the board, here is the truth.

My position – and I know for a fact that this is the same position as some of the other technically oriented people on the board like Stuart and Khebab – is that the quality of data you use to present your case are very important, and that the data in the case of Saudi gives very, very broad error ranges. Thus, one must be very cautious when making definitive statements on Saudi. It can easily blow up in your face. I won’t say more than that on this point, but you can e-mail Stuart or Khebab and get their opinions.

Second, I will point out that WT and I are on the same page on at least 80% of the key issues. I have long supported his ELP idea, I think his net exports argument is essentially correct, we have both called for higher fuel taxes for as long as we have both been on the board, and we are in agreement that the time for acting is long past. On these things we agree. So when people such as yourself use a broad brush and paint this picture in which WT and I are on completely different sides of the issue, this is highly inaccurate. On some issues, we sharply disagree. And on these issues, there is often a lot of heat. But don’t confuse that with the bigger picture.

Utilization down to 86.2%...full swing.

Demand UP (gasoline) 9.3 MMBPD - 0.3% more than 2006

Still have a way to go to get to 2006 levels in distillates and propane...and WINTER is almost here (Parts of Canada and US getting snow already)

TWO weeks of fairly large misses on the crude stocks!!!

Refiners consuming inventory vs paying high prices, and/or supply crunch? (too hard to tell from 50,000 ft)

Take note: Today's crude oil inventory report of 312,700,000 barrels was the lowest since October 14 of 2005, two years and one week ago.

Ron Patterson

As the inventory watchers over at PeakOil.com noted, it's all about imports this week. Jump in imported gasoline and distillates, but not in crude oil.

Crack spread...might as well just import the finished stuff!

Year-to-date, 2007 v 2006:

- domestic production (crude + NGL) UP 245 kbpd (+3.4%)

- total net imports DOWN 368 kbpd (-2.9%)

Again, partial import substitution via increased production.

Big drop in Cushing crude stocks!!

Well, the weekly EIA petroleum report is out.

Another drop in crude, almost 4 million bbl, but what REALLY got my notice was the change in stocks at Cushing, which is the delivery point for the NYMEX WTI futures contracts we always use when talking about the price of oil (well, almost always)

10/05/07 10/12/07 10/19/07 10/26/07
18.6 18.4 18.2 15.1

Cool, I did a table :-)

Anyway, that's a drop of 3 mbbl at Cushing! Which normally sits around the low 20s...
Jaymax (cornucomer-doomopian)

Bloomberg: Crude Oil Rises After Report of Unexpected U.S. Inventory Drop

Crude oil rose more than $3 a barrel after an Energy Department report showed that U.S. inventories unexpectedly declined.


The Organization of Petroleum Exporting Countries agreed last month to raise output by 500,000 barrels a day starting Nov. 1 to help ease prices that threaten economic growth. The move failed and prices have jumped 17 percent since the Sept. 11 announcement of the increase.

``Global demand for oil largely exceeds the production of non-OPEC countries and the difference is not matched by OPEC, so there is tension on the market,'' said Harry Tchilinguirian, an analyst at BNP Paribas in London. ``Oil-consuming countries will certainly be putting pressure on OPEC to increase output, but in the short term we don't anticipate a production increase above 500,000 barrels a day.''

Folks, how would you react if personal advisers came to your door suggesting you should ride a bike to work or take transit?
(I do ride a bicycle all year and own no car, so this isn't a rethorical question; I'm really interested in your (possible) reactions.)

Ulrich Nehls

I wouldn't answer the door unless I was expecting someone.

Alas, I don't live in the kind of neighborhood where the guy next door knocks on your door to borrow a cup of sugar. If someone knocks on my door and it's not someone I invited over, it's either a politician looking for votes, a salesman trying to get you to buy crap, or, most commonly, religious types trying to save your soul.

Yeah, 'personal advisers' would seem like missionaries to me, too. Advice should be given by request.

Depends. Does "personal advisers" mean thugs and "suggesting you should ride a bike" mean syphon rig filled with gasoline from the car?

Cuz I have a different answer for that than some dude knocking on my door and saying "ride a bike man".

I would love to take transit, if that were an option where I live. Riding a bike really isn't practical. The roads are narrow with no shoulder and too many cars. There are other problems, but the danger is enough to disuade me from biking.

Ask me again after gasoline goes to $10/gal. There will be a LOT fewer cars on the road then. :)

Shargash, bikes are generally much narrower than cars, so any bike should fit on the road no matter how narrow that road is. And if there are too many cars, getting yourself on the bike is "one less car."

If you practice what you preach you surely won't be posting here much longer.

Having riddden extensively in the 80's and just taking it up again in the last year I find the old addage of 'ride to the left of the fog line and behave like traffic' to have fallen out of favor with both cyclists and 'traffic'.

There is no transport anywhere near me so I will continue to ride (to the right of the fog line) but I'm under no illusions. It is still damned dangerous.

Why do so? Because otherwise we just keep on driving/warming, and trying unsuccessfully to outbid/outmuscle the rest of the world for the dwindling barrels of remaining export capacity. That's damned dangerous too. Less sensible long term.

It would be wonderful if managers recognized the need for safe bike lanes, NEV's, RE and TOD but it'll not come fast enough IMO. Cycling is availiable to most folks now and will probably explode like before as fuel and the dollar head in opposite directions.

Pick your poison and may you live in interesting times.

I do recognize that bicycles have faster and more comprehensive "elasticity of supply" than any other mode (including walking in today's America).

Best Hopes for a quick response post-Peak Oil,


Best Hopes for a quick response post-Peak Oil

Hear hear.

Yeah, I think the 'personal advisers' part is throwing up a red flag.. What does that mean? My Mom? or 'Big Brother'?

These days, EVERYTHING sounds like a nefarious euphemism..

To answer, though, I'd say 'Good Suggestion. But mostly I work in the basement.. but boy, it's pretty out there, I SHOULD go for a ride if I can find a minute!' (Of course, when I get a freelance job, I'm flying to Seoul or Tucson.. so there goes my modest footprint!)


Round here the knock from 'personal advisers' is usually the Jehovah's Witnesses or my neighbors letting me know our community well needs attention.

But with $100 a barrel oil looming in the background I'm hoping more of us will become ped-al-philes :) It's one of the relevant 'other arraingements' many folks can do right away to lessen their addiction to the pump.

I'd suggest that they go to our town council to "personally advise" them that our town needs lower speed limits and bike lanes so that it is safe to bike to work.

That the money going into their salary would be better spent on installing some bike lanes in actually useful locations, than on trying to nag people like me who already use transit despite its shortcomings into using transit.

How would he get past the doggies?

If you really want to know, while I have enjoyed using public transit from Moscow to Tokyo with South America and continental Europe in between, I don't expect to use public transit here in the US. I have even stopped using commercial aircraft.

The bicycle might be fun, helps one stay in shape a little.

I think we are entering one particularly nasty period of the peak oil game. The falling inventories and relentlessly rising prices are indicating that we are in competition for declining oil exports as predicted in the westtexas ELM.

Unfortunately prices are not high enough to suppress demand or promote any kind of long-term mitigation action in the developed countries. Actually until US starts competing with countries like China, Germany or Japan on the market I don't expect this to happen - so we are in that area, maybe between $50 and $200/bbl where we still can afford to drag our feet while every importing country with less than $10,000 GDP/capita slowly but surely collapses.

There are several ways out of this:
1) Fiat currency collapse - this is the logical outcome if we continue to insist on printingborrowing our way out of this. It will become especially nasty when US starts competing Europe, when the question "who gets the oil?" may transform into the question "whose printing press runs faster?"

2) Market fragmentation - I expects at some point the international oil market will collapse and oil will become traded on bilateral agreements, probably on barter basis. No more oil for paper. This is likely to happen simultaneously or as a result of the currency collapse.

3) An ordered and coordinated world-wide effort to lead ourselves out of oil dependency. How many of us are willing to bet on this one?

$100 oil in the US doesn't mean $100 oil elsewhere in the world. It isn't so much that oil is rising to $100 as the US$ is rushing down to meet $100 oil.

In the past hour the Canadian dollar has risen above $1.05 against the US dollar. It has risen from 64¢ to $1.05 in the past three years.

As the US economy and its dollar collapses, third world economies that are being crushed by US dollar interest payments are getting a "get out of jail free" card. The failing US dollar is a great boon to them.

If the US dollar index continues its dramatic slide oil costs Americans more at the pump, not the rest of the world.

The US uses something on the order of 35-40% of all the oil produced in the world, either directly or by proxy through products imported from the rest of the world. Should the American economy and its dollar collapse, demand destruction will occur in the US, but not elsewhere to the same degree.

If demand destruction in the US freed up just 10% of the world's oil, peak oil would become moot for the time being. $300 oil may very well be in America's near future. But that may look like $50 oil to the rest of the world.

I'm on thin ice here, but I've been wondering for several weeks why the crack spreads are so narrow in the US. It occurs to me that it may be the US dollar is so weak already, that it is cheaper to import gasoline than it is to refine it in the US.

Every day the US dollar hits new lows against the Euro. It is at a 1960 low against the Canadian dollar. Oil is getting expensive in the US. Elsewhere oil is still relatively inexpensive.

The way things are going, soon the US will be open for business and the world will come shopping, but it will be shopping with hard currencies like Euros, Rubles, and Renmenbi. The US may find itself in serious need some hard currency.

The dollar has been down ~15% so far this year, while oil is up ~50%.

So for the rest of the world oil price has risen by 35%.

In my view the FED and TPTB are relying on foreign creditors to keep the dollar from totally collapsing - a collapsing US will hurt their economies badly. Therefore they don't care about the dollar decline as long as it is not precipitous; they will continue outbidding poorer countries for oil and other resources by expanding money supply, and will rely on the rest of the world absorbing the inflation bill.

How long this could go on would be anyone's guess.

Atlanta Urinals, Fountain Run Dry as UPS, Coke Fight Drought

Urinals without water. Fountains without water. A waterfall without water.

Dry is the goal as United Parcel Service Inc., Coca-Cola Co. and other companies in the Atlanta area rally to cut water use in response to the region's most extreme drought since at least the 1920s. Metropolitan Atlanta, which has added more new residents than any other U.S. city since 2000, may face limits on growth if the shortage persists, business officials said.

"may face limits on growth if the shortage persists, business officials said."


BLAKELY, Ga. — Sammy Prim says he always thought environmentalists were "a little bit nutty."

Then a New Jersey-based utility, LS Power, decided to build a $2 billion coal-fired power plant here, just a few miles across the Chattahoochee River from his rural Alabama home. If built, it could emit up to 9 million tons of carbon dioxide, the primary gas blamed for global warming, every year.


River order may hurt Farley Nuclear Plant

BIRMINGHAM (AP) — Alabama Power Co. asked a federal judge Friday to amend her order temporarily increasing the amount of water flowing from Georgia into Florida by 60 percent, claiming the change could hurt operations of a nuclear power plant.

Sending additional water to Florida would lower levels on the Chattahoochee River and could affect the Farley Nuclear Plant, located in extreme Southeast Alabama, the utility claimed in court papers.

U.S. District Judge Karon Bowdre, meanwhile, convened a hearing on the three-state dispute. Rather than hearing arguments, she sent attorneys behind closed doors and told them to try to reach an agreement on sharing water.

Talks continued through the afternoon."

Arkansaw of Samuel L Clemens

Hello Leanan,

Interesting! I used this same link in my Foundation-themed reply to TODer ChrisN in the now stale thread of Jeff Vail's keypost:
Hello ChrisN,

Thxs for responding. The basic operating mode of Foundation is to let Mother Nature and human nature take its pounds of flesh, but attempt to steer this mode in desired directions by constantly tweaking or ignoring developing trends for optimum effect and control.

For example:
Atlanta Urinals, Fountain Run Dry as UPS, Coke Fight Drought
All these water conservation measures should be expected, and I hope the SE drastically raises potable water prices to promote further water savings combined with Humanure done on a huge municipal scale.

But if things continue to get worse: what is the next step?

Recall my speculative FEMA plan to start relocating SouthEasterners to a rehabilitated Detroit and other areas along the Great Lakes [a tweaking mitigation to reduce possible building blowbacks]. Now I have no idea [need a supercomputer to analyze, or an inside source] if FEMA prefers this possible tweaking, or prefers to 'purposely ignore' the situation, thus accelerating the natural growth of cascading blowbacks. I can't imagine FEMA not being aware of possible SE drought consequences; they have no excuse, no credibility to say the drought 'caught' them unprepared, if the worst comes to pass. Their mission statement clearly requires them to be prepared for such eventualities.

Consider the widely recognized, elevated risk profile of Nawlins and other outlying areas before Katrina: was the situation 'purposely ignored' by the Corps of Eng., and other govt and insurance entities that could have easily forced early abandonment, or the building of heavily reinforced levees, and/or low-level land infill much earlier?

Consider the long, global history of civilizational and ecological Overshoot & Decline, clearly understood by leaders since Malthusian effects were clearly delineated over two hundred years ago: the topdogs, if desired, could have mitigated this long ago by universal outreach [hell, they still could get started today!], but I believe they have other plans. They too have no excuse for plausible deni-ability--thus, that is why I see so much Foundation implementation when I examine the news. Of course, your mileage may vary.

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

The Big Club and you're not in it.

George Carlin: education and the owners of America


Arkansaw of Samuel L Clemens

Nothing terribly new in this report, but this is a detailed look into odd circumstances around the movement (or 'loss') of nuclear weapons at the end of the summer, discussed in earlier threads here at TOD. What seems to tie this to TOD/oil is the connection made to the end point of the flight - the base that 'happens' to be a staging point for Middle Eastern operations.



That article should be in todays drumbeat if you ask me. i wonder if it was missed or dismissed....

Neither. I saw it, and probably would have posted it eventually, except there's no need to, because you've already done it.

Same with the Yergin article Alan posted. I had it in the queue, but when I saw he'd already posted it, I removed it.

This is essentially NO different from the talk on the state of Oil Shale production given at ASPO-Denver. Same rhetoric, same limitations, same set of costs and pointing up the environmental "benefits" of In-Situ production. The big point made at Denver is NOT mentioned--the marginally positive EROEI. Like the Tar Sands, they will likely need nuclear reactors to generate the energy needed to cook and freeze the rock masses.

Actually, EROEI is mentioned in the article, albeit without using that term:

All this cooling and heating, of course, consumes energy. Can it possibly be worth it? Yes, says Vinegar, who estimates ICP's ratio of energy produced to energy consumed will range from 3-to-1 to 7-to-1, depending upon the scale of the project. Moreover, the power needed to perform the heating and cooling will be generated entirely from natural gas produced onsite by the ICP process.

Hmmm, must've been on the third page. The plan to use natgas generated by the same project is a laugher, notably derided at Denver. But those ratios are still real poor, given that it's a pumper/booster-type article. And as commented upon at Houston, shaleoil extraction has no real scalability. As the Shell man said at Denver, shale oil production at anything beyond experimental flows will only happen when oil becomes quite rare and dear, perhaps 30-40 years hence.

Exactly. When we have geothermal energy that's "too cheap to meter" then Oil Shale might be economic.


i am trying to decide if going to the extra trouble of putting a 500 gal tank underground is worth the extra work. the tank is designed for underground. i figure the fuel lasting longer due to cooler temps is the primary info i need. is this more of a factor for gas vs. diesel as i will have a smaller above ground tank too. my supplier says temps don't matter. 1 yr for gas; 4 for diesel. i am aware of additives & moisture pbs.
BTW the ethanol is separating & going to the bottom of tanks & causing problems.

now if i can afford to fill em anytime soon.

I've got thirty gallons put away in containers but I'm wondering about just getting a tank - how much did yours cost?

Aside from being good living spaces for the wandering survivors, SUV's are great for fuel storage. A big tank, read to fill from whoever you you can pillage.
Of course, that is the "soft landing scenario".

We've had such fuel pilfering problems here that we've had to lock up buildings. There are troubles in town as well, as evidenced by this very nicely done "No Gas" sign. I hope it doesn't go from pilfer to pillage, but we do still have a Republican in the White House.

No Gas!

After the loss of 2 tanks in the old volvo, I finally put on a locking cap--
And this is in Mill Valley (Marin County) with the highest per capita income in the State of California, along with the highest real estate values.

They always go for the soft targets.

In a place like CA, while really unlikely that someone living in a multi million$ house is going to shoot someone over 10 bucks in gas, they are probably hoping for it so they can sue in civil court.

They are much more careful with people that are perceived as having no assets.

Potential fuel theft is one reason that I bought a diesel. Storability of fuel is another.


The real funny thing is that I never lock my vehicles and more often then not leave the windows down, on the premise that if they want something they are going to take it anyway and this way they do less damage.

For some reason they never go for it while going for locked cars. Maybe they think it's a sting. LOL.

400 bucks. is a 2/3, 1/3 split tank w/ a cathode???bar
that keeps down rust. i got another for 50 but it is not worthy of undergrd[ i've had a leaker before].

Can anyone point to a source for fuel tanks, above ground or underground? I've been trying to buy one for a while and can't find a source.


look under heating oil local yellow pages & talk to a supplier. u can use 55 gal drums[not undergrd] as well.

It is quite common here to see 55 or 110 gallon tanks on a stand, or more likely two of them, with one containing gas and the other diesel. I find them laying about on abandoned farms all over the place, but I worry about corrosion after they've been left like that ...

Can anyone point to a source for fuel tanks, above ground or underground? I've been trying to buy one for a while and can't find a source.

This might be of some use.



creg -

If you are considering installing an underground storage tank for gasoline, I would strongly recommend that you contact your state environmental agency, obtain a copy of their regulations pertaining to underground storage tanks (USTs), and then very carefully determine what constuction, leak protection, monitoring, and reporting requirements pertain.

There is also usually a certain size cut-off for such regulations, so it is important to determine whether the size tank you are considering is above or below that size.

Leaking USTs have been a major environmental problem in the US, one which has resulted in billions of dollars being spent on contaminated site investigation and remediation. Having one or more USTs on your property can be a big headache and a potential liability, particularly if you should ever want to sell your property.

My opinion as a retired environmental engineer is that the drawbacks of having an UST on your property far outweigh the potential benefits of fire protection and reduced evaporation. If you get the right kind of aboveground tank with a proper pressure cap, and if you build a little roof over it to keep the summer sun off it, and if you locate it a safe distance from your house, you will probably be a lot better off.

Again, don't make a move till you thoroughly determine what are the applicable regulatory requirements pertaining to USTs in your state. They can be pretty onerous.

Good luck.

thanks joule! i think a roof it will have!

If you are considering installing an underground storage tank .... I would strongly recommend that you contact your state environmental agency, ...

How about building a "Celler" about maybe 2-3 feet wider/Deeper than your tank. And store your tank in the "Celler"? It's not buried, or Underground, it's in a Below ground room.


interesting. since i only have a front loader for the hole this is good, but not too deep or would float if empty.


ICE: Brent, WTI, Gasoil Futures, Spread Markets Trade Halted

The Intercontinental Exchange, or ICE, has closed trading in Brent, West Texas Intermediate and gasoil futures and spread markets as a result of technical issues, the exchange said Wednesday.

ICE didn't say when the contracts would begin trading again.

"All unexecuted active orders in closed markets have been held," it said in a recorded message. "For current position or deal reports please visit the ICE website. Issue updates and market reopen times will be available by email broadcast" as well as at the exchange Web site.

Umm...WTF does this mean?

Beats the heck out of me. Except if you're wondering why some of those oil price graphs were flat, that's why.

They want to sneak their bets into Prof. Goose's poll.

"Free market" manipulation?

Is that a little like Plunge Protection? "oops, moved too fast, must have been a computer error, everyone stop..."

Saw this over on Bloomberg:


Intercontinental Exchange Halts Crude, Gasoil Trading (Update1)
By Matthew Leising and Su Keenan

Oct. 31 (Bloomberg) -- Intercontinental Exchange Inc., owner of Europe's largest energy exchange, said trading of crude oil and gasoil futures contracts has been halted since 10:50 a.m. New York time.

``We did close trading in Brent, WTI and gasoil,'' said spokeswoman Sarah Stashak. ``We had to resolve some message issues.'' She didn't have further information on the cause of the shutdown. The exchange expects the markets to re-open at 11:50 a.m. New York time, Stashak said.

There's more to the article, of course... and I suspect more than meets the eye as well...

Franc (penguinzee)

Michael Lynch on CNBC

Michael Lynch says 2.5 million barrels per day of new oil is coming on line next year and it is unlikely that demand will grow by more than half that. He also says crude is being pushed up by "geopolitical elements" and that people are exaggerating the possible increase in demand in the fourth quarter.

Meir says oil will be down to $70 in the next three months.


Discussing whether record oil prices could take a bite out of big oil's profits, with Michael Lynch, of Strategic Energy & Economic Research; Edward Meir, of MF Global; and CNBC's Melissa Francis

Ron Patterson

Yes, I think it was just about this time last year that Mr. Michael Lynch was quoted in the Springfield (MA) Sunday Republican as saying that oil would soon be "in the low $40s." Let's see how close he comes this time.

Personally, if I were so bad at what it was that I was such an "expert" in, I think I'd consider a career change (yes, Michael, I'm baiting you).

I remember a Finnish economist once saying, after his predictions had turned out to be totally wrong, that "it's not the economists' job to predict. Our job is to explain". Yet he still makes predictions all the time, he just doesn't want to be accountable.

And it was a couple of years ago (2004) when he was up on stage with Matt Simmons, and Kenneth Deffeyes (when oil was ~56/barrel) saying that in October 2005 it would be down to $30/barrel. Do these guys forget we have the digital "tape?"

Maybe we should have a unit defined as Lynch-Yergins, rather than just "plain old" Yergins! Ya' think?

But I think he forgot to mention how much of existing capacity will disappear and whether new additions will make up for these looses. How much will North Sea and Mexico will lose next year?

I don't know about $70, Ron, but I am expecting a serious retreat from the $95 level from January to March 2008 and then the run up starts again next summer and fall, probably into the $110-$120 range. While $70 might remotely occur, I'm thinking more like $75-$80. We know the seasonal price cycles are there and the tightening supply should make volatility worse, meaning wider swings, both up and down.

"The greatest shortcoming of the human race is our inability to understand the exponential function." -- Dr. Albert Bartlett
Into the Grey Zone

Forex - Canadian dollar breaches key level of 0.95 to the US dollar

The Canadian dollar continued to surge higher, breaching the threshold of 0.95 to the US dollar as oil prices climbed.

Creates some interesting opportunities for retired Canadians who are looking for houses in the popular Phoenix area for instance.

According to the Case Shiller Index house prices are off more than 8% in Phoenix since their highs in June 2006. The US dollar has sunk 16% and there has been, say, 3% inflation (CPI) since then (more than a year).

So from their peak, houses there are 27% cheaper for Canadians in a little more than a year. It this keeps up (not particularly likely).... some real bargains will be had. (I should probably enlighten my parents on this)

Now when you Americans get around to trading the northern half of California for oil, gimme a call. I love that area.

Is this guy just a pure menace or what?? What an inconclusive piece of cr*p article:


And people rave about this guy like he 'gets it'...
I'm lookin' California, but feeling Minnesota...

Happy Halloween!

While looking around in the EIA data for nuggets I stumbled on changes in API gravity over time for imports.

Yesterday's post by galacticsurfer prompted me to post this plot which I've been working on for some weeks:

This graph is the percentage of imports by API gravity over the last 25 years or so. Please note the recent precipitous decline in crude 30-35 gravity, which has apparently been replaced by crude which is gravity 20-25.

That is, the light green line (20-25) crosses the purple line (30-35) in the last month or two. My apologies for using color if you are not able to see this. Next time I'll code it with line types too.

This represents the most rapid change in the most frequently imported weight of crude in the last 20 years.

The price plots do not appear to show any corresponding changes. While I would expect the price sequence to hold (for example lighter grades to be more expensive than heavier grades) it looks to my first approximation that the price deltas did not shift much in the last couple of months.

We should receive a refresh of this data some time soon, as it is released monthly. Please note that this graph is bezier smoothed data for clarity but the recent points check well to the curve.


Opinion: Many of us have been expecting a decrease in the overall API for some time. We haven't seen any aggregate change. But it looks to me like a major supplier or field has dropped out or changed.

I've looked carefully at the import data and cannot see a per-country change. I'm a little suspicious of the type which was dropping, some very large fields are in that range including Ghawar. I think it will take more data than is posted by EIA or a meta-analysis to tease out the supply change, if it persists.

Does anyone have a relatively complete listing of API gravity vs. field? I think it's in the BP annual but need to go look.

TOD is the first, and last site I check every day. Thanks for all the stimulating conversations!

Best regards

By coincidence, Dante over at PeakOil.com just posted today saying that he thinks heavy oil from Canada is replacing WTI at Cushing.

Could your chart mean that Canada is sending us more tar sands instead of conventional oil now?

The transition took place in the July-August time frame, and during that time we saw the following other changes:

Source July-Aug diff kb/d
Canada +150
Ecuador +68
Mexico -137
UK -195
Algeria +97
Nigeria +302

The numbers are noisy; I picked just ones which looked fairly different from their baseline. This is non-rigorous, just wanted to add the little extra info. Also I think in August we had a 200 kbpd shutdown of the BP line in Alaska.

Also, still looking for tar sands APIs as delivered. Syncrude SSB is 31-33, but there are five other sisters or so and other grades.

From what Dante said, it's not easy to determine the gravity of tar sands oil. It's upgraded at special refineries along the way, and may be much lighter when it gets to the final refinery that it was when it started.

Shouldn't Robert be able to address this question? He seems to know what all the refineries are running these days.

I just bring this up because he has time and time again said that the quality of crude being processed at refineries in the US has not changed much over the last decade or so.

I just bring this up because he has time and time again said that the quality of crude being processed at refineries in the US has not changed much over the last decade or so.

And it hasn't:


Crude gravity in 1997: 30.71 to 31.7
Crude gravity in 2007: 30.27 to 30.86

Crude has heavied up slightly, but refiners have added cokers to process heavy oil. But you can scan the data and see the gravities that are actually input and are required to be reported by U.S. refiners (and the average is still quite light). There really isn't a need, in my mind, to make it complex when the actual gravity fed to the refineries is available.

I will say again, refiners don't buy what they can't process. If they don't have a coker or hydrocracker, they aren't going to buy heavy oil. But a lot of refiners have been installing cokers, as the economics (as I showed in my Assay Essay) usually greatly favor heavy crude.

Crude will continue to get heavier. But it is a slow change. Again, the data are there. You don't need me to interpret it.

Dragonfly41: I just bring this up because he has time and time again said that the quality of crude being processed at refineries in the US has not changed much over the last decade or so.

RR: And it hasn't:

Robert, you are correct in describing the aggregate crude gravity for the last 30 years. Sorry to drag you into this thread from Halloween :-)

My post specifically was not about aggregate crude gravity, it was about the rapidly changing relative contribution of two grades to our imports. The highest category just changed volume by 30% in one month.

To me that says more about the producers than the consumers. Someone stopped shipping a large volume of medium and it was replaced -from somewhere- with a grade two categories lower.

To put it another way, the difference in imports is:
June: 299,477,000 barrels imported all countries
July: 306,950,000 barrels imported all countries

in June, 30-35 deg. API was 27.8% or 83,255,000 bbl
in July, 30-35 deg. API was 19.2% or 61,211,000 bbl

in June, 20-25 deg. API was 26.1% or 83,209,000 bbl
in July, 20-25 deg. API was 31.6% or 100,743,000 bbl

Thus, we imported 22 million fewer barrels of medium,
and imported 17.5 million more barrels of heavy.

Something significant happened -- not in general, but specifically between these two grades -- and I'm just wondering what it is?

We now return you to your regularly scheduled re-manufactured pagan holiday for liminal contacts and other bemusements.


Thanks NR...so you and Robert were talking about two different things?

So we are importing more heavy crude, but Robert is saying that this crude is not heavy by the time it gets to the refineries?

I'm confused by all this. Robert, how can this be? What's missing here?

Seems there are only two possibilities here:

1. Heavy oil is displacing light oil in inventories and/or

2. Heavy oil is being upgraded after it leaves Canada but before it gets to the refinery where is cracked into products.

My apologies, after only 20 proofreads I made a big mistake.

Please change this:

Opinion: Many of us have been expecting an increase in the overall API for some time.

to this:

Opinion: Many of us have been expecting a decrease in the overall API for some time.

Must've spent too long in those gravity inversion boots.


I made the change for you, for clarity's sake.

Degrees API is annoying (I just wrote a bunch of 2004 API code). kg/m^3 is much easier to deal with.

Retail prices automatically take the different oil types and the different refining costs into account. Gasbuddy says average pump price is $2.92 which comes to over $122 bbl.


The article in the link above taken from today's Drumbeat states that...

"Every oil transaction around the world, save for a piddly few done by Iran, is currently paid for in greenbacks. However, that may be about to change.

Check out these excerpts from a story that Reuters ran over the weekend:

OPEC is likely to discuss creating a basket of currencies for oil pricing at its next summit due to the steady decline in the dollar, Venezuela's Energy Minister Rafael Ramirez said on Friday.

"The need to establish a basket of currencies ... will probably be a point of discussion in the next OPEC summit," Ramirez told reporters during an evening event in the presidential palace.

The dollar as a benchmark currency has been weakening quite a lot and it creates distortions in oil markets."

This quote above indicates that excluding the "piddly few" that oil is paid for in dollars, not just priced in dollars.

Is this true? Or is the writer simply conflating "priced" and "paid."

Iran is 4,416,000bpd out of a global supply of 63,666,000bpd or 6.5%. They do 85% of their transactions in currency other than dollars. 6.5% * 85% = 5.5% of global oil settled without using dollars.


It is a small step in dollar volume, but a giant leap(well, a tumble) in the dollar's position - its OK to not use U.S. currency for oil transactions because Iran says so.

Ahmadinejad says "squeal like a pig" and Bush promptly complies. Don't like to see what is happening to our currency but I take some grim satisfaction in the fact that its going to get all over the current administration. Once the roadblock Republicans are gone perhaps we'll get some sensible forward motion on all sorts of things.

Jerome a Paris has a nice DailyKos post on the truth regarding the U.S. interaction with Iran over the last few generations.


Here is Mish’s take on the basket of currencies.

Thank you, thank you. Mish at least knows what he is talking about

One does not need dollars to buy oil.

Furthermore, if one is sure the Yen or British Pound is going to rise vs. the dollar then one should hold Yen or Pounds (not dollars) to buy oil with. Yes, it really is that simple.

I have said this before and I will keep saying it until everyone understands it: It does not make any difference what currency oil is priced in, and that logic can be expanded to include baskets of currencies.

Oil is not bought in dollars, it is only priced in dollars. Oil is bought in whatever medium of exchange is agreed on between the two participants.

"Every oil transaction around the world, save for a piddly few done by Iran, is currently paid for in greenbacks. However, that may be about to change.

This is another case of journalistic ignorance. Every barrel of oil is not sold in dollars, it is only priced in dollars. I have asked dozens of times for anyone to producr any evidence that Europe but oil from Russia in dollars and not one iota of evidence has ever been produced. It is a wive's tale.

What would moving to a basket of currencies change? What would the unit be? All that would happen is that instead of oil going up 10% from $100 to $110 dollars it would go up by a percentage that better reflects the actual cost to consumers weighted by trade. So it might go up from one unit to 1.05 units.

While I agree that this would be a far better way of understanding the change in oil prices, it would have no impact on the currency people use to buy oil. There is no reason, any of us couldn't put the historic price into a basket format anyway.

The following is from Ludwig Bölkow Systemtechnik study Alternative World Energy Outlook (AWEO) (2007). The image is quickly patched together from their presentation:

It's just a teaser and the study offers a solution of one sort.

Useful for those who still think there might not be a solution. It's just one opinion, but worth looking at (even if they tout Hydrogen infrastructure through electrolysis, which I'm not a great believer in, at least not currently).

The article about the Belene NPP in Bulgaria fails to mention that 5 non-Russian Utilities - Electrabel, CEZ, E.ON, ENEL and RWE are competing for a strategic partner owning 49% of the NPP. The tenders were submitted by Oct. 17.

It is notable that 2 of them are German and one is Italian - obviously as Germany and Italy have prohibited nuclear in their home countries, they are trying to "go around it" and acquire nuclear assets abroad.

As for whether the plant is needed, the question is ridiculous. Albania is already amidst severe energy crisis, Serbia is experiencing difficulties, even Greece had blackouts this summer. Turkey is expected to have a shortfall within several years and is also considering nuclear power on its own. If these countries want to ensure their economic growth continues, they will need the electricity. Other options are limited, mainly to low quality coal and imported NG.

As for the growing Russian dependence, which is the main concern of the article; the dependence in the nuclear sector is far less than in any other energy sector. Nuclear fuel can be provided by any other country and Bulgaria has enough of know-how and engineers to run the plants without assistance. We of course become dependent on equipment, but this could also be provided by external parties if needed (though maybe at higher cost).

Overall the article is a bit tedious, but I attribute it to the reincarnated "cold war" against Russia we are seeing lately.

Surrealism In Everyday Life Award: Venezuela’s Gas Prices Remain Low

...from the if-this-isnt-Export-Land-in-action-I-don't-know-what-it-is department


"Motorists in the United States smarting from rising gasoline prices, take note: Mr. Taurisano pays the equivalent of $1.50 to fill his Hummer’s tank. Thanks to a decades-old subsidy that has proven devilishly complex to undo, gasoline in Venezuela costs about 7 cents a gallon compared with an average $2.86 a gallon in the United States.

But a thriving car-buying habit rivaled by few nations is forcing the government here to sell greater amounts of cheap gasoline. Vehicle sales in Venezuela climbed 49 percent in the first nine months of the year from the same period last year.

Domestic fuel consumption is up 56 percent in the past five years, to 780,000 barrels a day, said Ramón Espinasa, a former chief economist at Petróleos de Venezuela.

Perhaps the most coveted S.U.V. of all in Venezuela is the Hummer, an ethical quandary for Mr. Chávez.

“What kind of a revolution is this?” the president said on his television show this month, after a report here that General Motors was planning to import 3,000 Hummers to meet a rising demand. “One of Hummers?"

Maybe, but I would guess that China removing oil subsidies is more than offsets the demand increases from all of the subsidies that oil producing countries have or have added.

WesTexas was right about the current situation, but drasticaally underestimated the abilities of countries to react to the damage the subsidies cause. It is very easy to see how the net export trend could reduce, or at least stop growing.

Supersonic, manta rays or slower planes? The future of air travel

They don't mention in that article the safety aspect of wide bodied aircraft, namely the requirement that a full load of passengers must be evacuated within 90 seconds, using half of the available exits. The safety requirement aligns with commercial requirements, which is airlines want quick boarding times to reduce the time spent at the gate.

With a wide lifting body fuselage, I don't see where you could put sufficient exits. I think it's another case of diminishing returns.

Maybe the struggling airlines will lobby for FAA approval to carry more freight with their passengers. The lifting body doesn't conform to the ideal cylindrical shape for a pressurized fuselage, but the cargo doesn't breathe. So you put the freight and fuel on the outside. It would also eliminate passenger windows, which is a good engineering idea but probably bad salesmanship.

"It would also eliminate passenger windows, which is a good engineering idea but probably bad salesmanship."

Just put the windows in the floor...they'll love it! ;)

California's attempts to fix global warming.


Richard Wakefield
London, Ont.

No one is ahead of their time, just the rest of humanity is slow to catch on.

1/4 Point Rate Cut. FYI.

And the Fed rate cut is a quarter point, as widely expected.

And the dollar is headed to 1.45 against the euro. Oil is approaching $95.

I have always been a saver all my life; looks like I'll never learn that savers are always screwed by TPTB.

Just stash your savings in something other than US$

When did they start taking gold and Euros at the local QuickTrip?

Is the ICE still closed? I wonder if oil trading suspension and the rate cut are related.

No, it opened again about noon.

On the main french financial site "Boursorama", François Lescaroux, an economist from the french oil insitute (institut français du pétrole IFP), has taken an on-line interview with internauts (sorry, text in French).

Basically he says (my translation, sorry if I made any mistakes) :

- prices are going to rise exponantially (the price of crude is like a bouncing ball in a lift), all the prices and for a long time, 10% per year, due to the imbalance between "demand" and production
- the concept of peak-oil has reached a state of consensus among industrials and in the financial world, timing is a more subjective issue - but he doesn't rule out the fact that it could be now
- OPEC has a spare capacity of about 2.5mb/d but this is not significant, OPEC doesn't control the market any more
- a weak dollars boosts world-wide demand which in turn lead to an increase in the price of oil

IFP is our national oil observatory. It is located in Lyon in the same complex as Feyzin's refinery. Their opinion is close to that of the French government.

P.S. I thought Halloween was about fake freak. Today there is some real freak with the broken ICE, a natural gas pipe-line explosion in Mexico, a fire in an English refinery, oil at 94.8$, a strengthening Noel (=christmas in French ...). Happy Halloween though !

Hello TODers,

The more prices rise, the more Mexico gets hammered:

Oil Price Rally Mixed Blessing For Gasoline-Importing Mexico

MEXICO CITY -(Dow Jones)- The sustained rally in world oil prices should be a boon to Mexico's state oil company. Instead, the rising cost of gasoline imports has helped push the company's bottom line into the red even as oil prices soar.

Petroleos Mexicanos reported a net loss of $1.2 billion in the third quarter, compared with $2.6 billion in profits in the year-ago period when oil prices were lower.

Fuel import costs limit the ability of oil states like Mexico to invest in exploration and drilling activities, which in turn pushes world oil prices even higher because it takes longer than expected to get new projects on line.

The cost of importing gasoline, diesel and other fuels for the Mexican market rose $1.8 billion over the year-ago period, according to a company presentation

That effect, plus the shrinking remittances sent back home to families, from Mexicans working in the US, must be really starting to put the big hurt to Mexico.

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

That is the scariest set of headlines that I have yet seen. Leanan, have you kept data on the number of news headlines that crop up under a given search word(s) over the years? I'd like to see THAT graphed. I think we are at the tipping point.

Let your views be known: www.cafepress.com/crashdummy

Now why'd I never think of this before.

the number of news headlines that crop up under a given search word(s) over the years?

How about Google Trends - no actual numbers, but lets see...

for "Peak Oil"

The bottom line is the number of news references - ignore the down tip at far right, it seems to be there for any search term. Click on the graph above to play with your own words.

Also, it's not quite up-to-date, as evidenced by:

for "Wildfire"

Jaymax (cornucomer-doomopian)


Wow, NYMEX is at 95.50. I think it was below 90$ yesterday? With such velocity we could end up at a 100 tomorrow. There are good reasons for the high price, but volatility clearly shows there is a lot of money that moves in and out of oil.

Yes. Also, about 1.25 of that move is the US dollar sell-off of today, so there was a double wham today.

Ya...I may have missed the $100 prediction by a day...I'd say Friday at the latest...I was pretty sure crude inventory would be down...and with the rate cut...that would inflate the price more with more downward movement in the dollar. It will probably hit $100 just for the thrill of it (trader's mentality) and then come back to around 90ish for a week or so.

Then the country will really start getting cold and who knows what will happen.

I agree...I called for $100 today (within a reasonable prob range), but I would say missing by one or two days is in the ballpark.

Tomorrow we may see $100 or at least TAPIS break $100, as one milestone.

$100 is a given at this point...only a matter of how soon.

Hello TODers,

ATTN: I consider this a must read for all TODers! Leanan, could you forward this to Bart @ EB please?

Study reveals that nitrogen fertilizers deplete soil organic carbon

The common practice of adding nitrogen fertilizer is believed to benefit the soil by building organic carbon, but four University of Illinois soil scientists dispute this view based on analyses of soil samples from the Morrow Plots that date back to before the current practice began.

Intuitively, it makes a great deal of sense: it is the height of hubris to think that we can improve the topsoil building and optimization process of Mother Nature by injecting too much synthetic nitrogen for short-term harvest yields. Constant crop rotation maybe the better long-term solution to rebuild soil health & tilth, but global food yields will drop precipitiously until the topsoil re-equilibrates from the much more frequent plantings of nitrogen-fixing species.

The good news is that potash & phosphate minerals still need to be mined and distributed, but companies highly reliant and invested in giant Haber-Bosch natgas facilities may want to rethink investing any more capital.

I anticipate that other soil-scientists will try to validate this research, but I also think we will see other scientists, paid by the PTB, to purposely invalidate and confuse the public [Recall the smoking-cancer stifle agenda, and the on-going global warming stifle agenda].

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

Why me? Do it yourself! You know how to use e-mail, don't you?

Hello Leanan,

Your right. I apologize! But I do not have Bart's email address, so I submitted it to EB the long way.

I don't have Bart's e-mail address, either. I can only see people's e-mail addresses if they've put them in their profiles and made them public. If you can't see it, I can't see it.

I could ask SuperG to track down the address someone registered under, but I hate to bother him unless it's really important.


Or you could 'join them'


(And what you have 'noticed' has been 'known' to the people who study the soil food web for some time. http://www.soilfoodweb.com/ Excess Carbon in the soil is why http://www.soilfoodweb.com/03_about_us/dr_ingham.htm has not endorsed Terra Preta)

Hello Eric Blair,

Thxs for responding. Yep, joining EB is what I did to forward the info to them.

Also, I respectfully submit that you are confused on the meaning of this link: nitrogen fertilizers DEPLETES the soil carbon, therefore Terra Preta might be required to help maintain soil carbon.

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

Holy guacamole. $96!

No fair! Pipped to the post... :-)
Jaymax (cornucomer-doomopian)

Holy Palm Oil? (sorry how do you trump guacamole?)

nearly $98 USD - TAPIS


I've been wondering for a while why the prices were different for the same type of this "fungible" commodity and I just found a nice explanation of both the geographic concerns as well as the business aspects.


sorry how do you trump guacamole?


Hello TODers,

Recall my much earlier postings that documented Mexico as a world-class leader in deforestation and desertification. It now appears that even a non-hurricane rain event can unleash terrible flooding:

MEXICO CITY - A week of heavy rains unleashed massive flooding Wednesday in southeastern Mexico, where tens of thousands fled the rising waters for shelters in Tabasco and Chiapas states.

At least 20,000 people had sought shelter in Tabasco's oil-rich capital of Villahermosa, where floodwaters reached the rooftoops of homes, and Gov. Andres Granier was urging residents to evacuate.

"If they do not leave, I'm going to order them out by force," Granier told reporters in an interview broadcast on the Televisa television network.

President Felipe Calderon flew to the area Wednesday and offered "all help humanly possible" to the more than 300,000 people of the state whose homes were flooded, damaged or cut off.

In the southern state of Chiapas, 7,000 people were evacuated due to floods, the daily newspaper El Universal reported.

In Villahermosa, rooftops barely jutted above the surface of brackish waters flooding the city's streets after at least one major river overflowed its banks.

"Tabasco (normally) has water on 34 percent of its territory, but I can tell you that now, it's more than 70 percent water," Granier said Tuesday, according to a transcript of his comments posted on the state government's Web site. "In 48 hours, our state has been devastated, totally devastated."
The article also mentions a ruptured gas pipeline. Anybody have more info on other possible shutdowns of the Mexican FF-spiderwebs and electrical grid?

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

I know its peak oil and not peak water, but a beating death over lawn watering in Australia?


Hello SCT,

That's nothing, wait till things really get rolling postPeak. I have mentioned this newslink many times before in various postings about water-scarcity:

...The guerrillas opened the sluice gates at Maavilaru releasing water to some 15,000 farming families downstream after a request from peace broker Norway, the Tigers said.

The rebels had closed the sluice gates on July 20, sparking the island's bloodiest battle in four years which claimed over 440 lives and displaced tens of thousands of people.
The fighting is still ongoing....

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