DrumBeat: November 5, 2007

OPEC October Output Rose 1.6 Percent, Survey Shows

The Organization of Petroleum Exporting Countries raised production 1.6 percent in October in advance of the group's pledge to increase supplies starting this month, a Bloomberg News Survey showed.

OPEC pumped an average 31.16 million barrels a day last month, up 495,000 barrels from September, according to the survey of oil companies, producers and analysts. The 10 members with production quotas, all except Angola and Iraq, increased output by 305,000 barrels to 27.135 million barrels a day, the highest since October 2006.

Venezuela: Puerto La Cruz refinery shuts down for maintenance

Distillation unit 1 at Puerto La Cruz refinery of 200,000 bpd stopped for maintenance works, an official at the oil facilities told Reuters on Monday.

The works are estimated to last at least 30 days, but operations could start within 20 days.

Simmons Spells it out - but When Will the Ostriches Get Their Heads Out of the Sand?

"If I was redoing Twilight in the Desert today, I'd sharpen the severity of the warning quite significantly.

"May, 2005, still stands out as the all-time record high for global crude production - 74.3 million barrels per day, and now we're down 1.2 million barrels per day. The IEA shrug that off, saying that if you look back over the last few years, records have been set several times; a peak followed by a falling off, then another peak, and so forth.

"That's an interesting thesis. But as we watch Mexico start into its big-time decline and UK and Norway continue their rapid declines, plus Indonesia, Egypt, Argentina and others besides - you can see several years of relentless decline. Add them up and say, find me one area coming on in the next few years that will halt such a collective decline - it's just not there.

"Major oil companies have quadrupled their spending over the past five years and, other than acquisitions, basically they're in liquidation."

All Peaked out and No Place Else to Go but Do-o-o-w-n

"PEAK oil is now", proclaims a hard-hitting study of global resources by the German-based Energy Watch Group.

Its predictions are dire: global oil output peaked in 2006 at 81 million barrels per day, will slide to 58 million bpd by 2020 and 39 million bpd by 2030.

This is in sharp contrast to the International Energy Agency, which predicts 105 million bpd by 2020 and 116million by 2030, though offline, there is a growing view at the IEA that its projections are too optimistic.

OPEC output rise would not affect prices - Algeria

The world oil market is well-supplied and any decision by OPEC to increase crude output at its meeting next month would not stop prices from climbing, Algerian Energy and Mines Minister Chakib Khelil said on Monday.

Crude economics

Addicts are not always put off by high prices. Sometimes the cost of the drug makes the craving more dangerous. But a world addicted to fossil fuels is in serious need of cold turkey. It could be getting it now from rapidly rising oil, gas and coal prices. The price of crude oil is close to $100 a barrel, up almost $40 since last year and at an all-time high. That has added to worries about a global economic downturn, and if it is sustained the price will have a negative effect, especially in the US. But the real problem with oil's current price is not that it is too expensive, but that it is still much too cheap.

The New New Fuel

BURLINGAME, CALIF. - Turning wood chips into fuel isn't quite like turning water into wine, but it's still a pretty impressive feat. On Tuesday, a company backed by Vinod Khosla, one of Silicon Valley's most successful venture capitalists, will break ground on a plant that will do just that.

Range Fuels, a Colorado-based start-up funded by Khosla Ventures, is building the first commercial-scale plant in the U.S. (and very likely in the world) that will produce the next generation of ethanol--called cellulosic ethanol--in the small town of Soperton, Ga., about three hours south of Atlanta.

Is the Oil and Energy Bubble About to Burst?

With crude reaching for $100 a barrel, one should start being cautious. Here in the US we are still taking these oil prices fairly well, but elsewhere (such as China or Iran) we are already hearing that these high oil prices are slowly starting to create social pressures and increasing tensions turned toward those governments. And stress of that nature could mean that we are nearing a turning point in this "never-ending" energy boom.

Scotland: Thousands 'in 'fuel poverty' as energy costs increase

HUNDREDS of thousands of households are living in "fuel poverty" because of soaring energy costs, campaigners warned today.

Some 600,000 households and 100,000 children in Scotland have been hit by rocketing fuel prices between 2003 and 2006, they said.

Do you know how Oil originated?

Demand for oil began to increase from the middle of the eighteenth century. During the Industrial Revolution, oil was needed for lighting homes and factories. Before petroleum, whale oil was commonly used to make candles and as fuel for lamps.

However, the supply of whale oil was running low and the price had skyrocketed. At that time petroleum was obtained by distilling it from coal, by skimming it from ponds and streams, and by oil shale retorting. None of these processes could meet the rising demand for oil.

Food pantries worry about bare cupboards

Andrea Helms, the food bank's communications director, said several factors have made its work more difficult over the last few years. Some of those include:

The increasing cost of fuel that's needed to transport food.

A decrease in the amount of food distributed to regional food banks by the U.S. Department of Agriculture. In fiscal year 2002, 31 percent of the Tarrant Area Food Bank inventory came from the USDA. In September, that had dropped to about 7 percent.

Grocery stores selling more of their nonperishable foods, like canned goods, to secondary market stores or dollar stores. Thus, they have less nonperishables to donate to nonprofits.

Driven by high energy prices, coal mining makes a comeback in Wales

Two decades ago, Britain was shutting coal mines and coal miners were staging desperate and sometimes violent strikes in a vain attempt to save their jobs.

Now, near-record-high energy prices on world markets are bringing the traditional work of mining back to Wales, one of the poorer regions of Britain.

Canadian oil industry basks in profits, and tax cuts

Crude oil prices are at record highs, and showing no signs of declining. Most of its current production is either conventional or from the oilsands, both at historic costs that are far below current price levels. The oil industry's success in limiting Canada's refining capacity has paid off massively, quietly generating superprofits in the refining and distribution end of the business.

Profits are fattening balance sheets and individual bank accounts at a rate that would make one of the legendary robber barons of the late 19th century blush.

Indonesian fuel subsidy soars amid oil price rise

The fuel subsidy in the Indonesian state budget is estimated to hit 90 trillion rupiah this year (about 9.8 billion U.S. dollars) against the initial projection of 55 trillion (6 billion dollars) due to soaring oil prices, an official said Monday.

Japan's Greenhouse Gas Emissions Rise 6.4% From 1990 Levels

Japan's greenhouse gas emissions rose 6.4 percent in the year ended March from 1990 levels, forcing the government to quicken measures to ensure the country meets its Kyoto Protocol target.

Thailand: Oil Fund starts contribution cut

With immediate effect, the contributions that retailers have to pay the Oil Fund for the sale of every litre of all fuel products would be cut by 40 satang per litre.

South Africa: Oil price heralds gloom

Consumers have little reason for cheer, as rapidly rising oil prices and the prospect of another interest-rate increase by the Reserve Bank look likely to put the brakes on festive-season spending.

Nuclear energy and economic growth in India

An examination of data published by the International Energy Agency indicates that India is the 5th largest producer of electricity in the world. However, while India is amongst the top 10 countries of the world in terms of production of electricity by hydro, coal, oil and gas, it is nowhere near the top 10 with respect to nuclear power generation. For a large country like India with its recognized advanced capability in nuclear power technology, this is an anomaly in need of correction.

Whatever Happened to Fuel Cells?

In 2003, President George W. Bush called for a billion-dollar initiative to make fuel cells the future replacement of the gasoline engine. These clean battery-like devices produce electricity by combining hydrogen and oxygen and giving off only water.

But four years down the road, not many besides California's Gov. Arnold Schwarzenegger have been behind the wheel of a fuel-cell car, and a big reason for this is the paucity of hydrogen fuel filling stations.

Green movement is changing design

Now imagine if you could design your own car to achieve the level of fuel economy you sought and later work with the EPA to certify that the car met your objectives.

That's the kind of validation a growing number of building owners are seeking in Eastern Iowa through a certification program called LEED, for Leader in Energy and Environmental Design.

Richard Heinberg's Museletter: Big Melt Meets Big Empty

If people in the industrializing countries (particularly China and India) continue to burn more coal and drive more cars, they will metaphorically cook the planet. These nations have the highest growth rates for fossil fuel emissions, and China is set to soon become the world's foremost carbon emitter if it has not already done so. These nations are in effect saying to North America, Europe, and Japan, "Agree to reduce your emissions faster than we do, or we won't reduce ours at all and the entire planet will burn."

This Grand Bargain could amount to an unprecedented shift of the world's economic center of gravity. During decades of "development" policy and aid, the disparity between rich and poor only grew; now, however, the poor world has a weapon - even if its use implies a suicide pact.

U.S. dilemma: Targeting Iran's oil industry could hurt America more

"If Iran sees US $100 a barrel oil, Iran is likely to conclude, and it may well be true, that no matter how severe the sanctions ... the regime could sneak by," said Matthew Levitt, a former U.S. Treasury Department terrorism expert, who is now with the Washington Institute for Near East Policy.

Yet long-term, finding some way to target Iran's oil is crucial, some analysts say, because its oil exports generate billions of dollars in hard currency, providing Iranian President Mahmoud Ahmadinejad with strength to defy the international community.

Will Iran celebrate the 100th anniversary of its oil discovery with $100 petroleum?

Oil prices have surpassed a record US$96 a barrel. Given the growing geopolitical tensions in the Middle East involving an imminent war between the Turks and the Kurds over the future of oil-rich Kirkuk and the prospect of an independent Kurdish state, and the current standoff about Iran's nuclear program, petroleum prices may cross over $100 a barrel in coming months.

ExxonWhat? PetroChina Is the New No. 1

It was a record-setting day for PetroChina. With an $8.9 billion debut in Shanghai, the state-controlled oil-and-gas producer laid claim to raising the greatest amount of money of any new listing globally this year. By the end of the first day of Shanghai trading on Nov. 5, PetroChina's share price had more than doubled, to 59¢, up 163%.

Oil Companies Compete for Bahrain Facility Upgrade

"They are bidding for a number of things - the most important thing is to use new technology to increase the level of production of the Bahrain field and also to increase the level of reserves. So the benefit is two-fold - an increase in both the production of oil and gas and the reserves of oil and gas," Dr Mirza says.

Kuwait oil minister quits

Kuwait government has accepted the resignation of its new oil minister, Bader al-Humaidhi, just eight days after he took the job at the world's seventh-largest oil exporter.

US-Canada War Looms Over Energy, Water

Washington's new tensions with its northern neighbor and largest trading partner appear to be over perceived Canadian reticence to support US imperial adventures in the Middle East. But the vast resources of Canada itself—made more critical both by instability in the energy-rich Mideast and by shortages of such basic commodities as water brought on by climate change—may be providing a long-term source of conflict between the two giants of North America. While on the economic front all talk is currently of integration and falling trade barriers, battles are already being waged by the grassroots both sides of the border against resource plunder and mega-development schemes. These could eventually mean war between the two longtime allies if a populist government comes to power in Ottawa and tries to turn off the spigot of south-bound resources—and the Pentagon has already drawn up plans for this contingency. Rumbles are already being felt in such unlikely places as the rolling farmlands of upstate New York, the grizzly-haunted pine forests of Montana's wild Flathead Valley, the windswept high plains of northern Alberta, and the remote passages of the Arctic Sea.

Peak Oil: Alternatives, Renewables, And Impacts

This article examines scientific and government studies in order to provide reliable conclusions about Peak Oil and its future impacts. Independent studies indicate that global oil production peaked in 2006 (or will peak within a few years) and will decline until all recoverable oil is depleted within several decades. Because global oil demand is increasing, declining production will soon generate high energy prices, inflation, unemployment, and irreversible economic depression.

Consumers feeling the helium squeeze

The gas that floats balloons also powers industrial and scientific projects. And it's disappearing fast.

EnCana takes its bat and ball to Texas

In late September, EnCana Corp. chief executive Randy Eresman issued a warning to the Alberta government: You follow through on proposals to sharply increase oil and gas royalties, and we'll redeploy our deep pools of cash elsewhere. Now, it looks like Mr. Eresman is putting his money where his mouth is.

Guangdong passengers fume at diesel shortage

China's diesel shortage has hit the transport industry hard, particularly bus drivers and truckers, who now have to join long queues at diesel stations for a few quarts of diesel each time.

The extra waiting time for buses to fill up on fuel, which is reportedly at least a half hour at each stop, has resulted in a slew of customer complaints. Trucking companies, on the other hand, are faced with service disruption and late deliveries.

Ireland: Motorists warned of rising petrol prices

Topaz Energy, which operates the Shell and Statoil network of forecourts, today warned consumers to expect a significant increase in the price of petrol, diesel and home heating oil.

"While price increases for the consumer are of course regrettable, in the face of the 40 per cent crude oil increase since mid-August, today's decision became unavoidable," said chief executive Danny Murray.

Q: How high must price of fuel go before motorists are driven off the roads? A: £1.86

MOTORISTS are so attached to their cars they would continue to drive until fuel nearly doubled in price, according to a survey published today.

The Philippines: Can voluntary oil demand management save the day?

But years since former President Fidel V. Ramos signed up independent power producers as a quick fix to the country’s supply woes, government forecasts indicate that as the economy continues to grow, an increase in electricity requirements in the next 10 years would result in a “critical period” for Luzon in 2010, for the Visayas in 2011, and for Mindanao in 2009.

Tanzania waives import duty on cement to ease supply deficit

Klaus Hvassing, chairman of the Tanzania Chapter of the East African Cement Producers Association told The East African that recent fuel hikes and growing demand for cement from dealers in the Great Lakes region was the main cause of surging of prices in the local market.

The Switch Has Been Flipped: It's Too Late For Solutions

Tim's comment resonated with my experience in teaching history to college students who incessantly ask, "But what can we do?" when I systematically lay out the reality of the corporatocracy the United States has become, energy depletion, climate change, and of course, the police state in which we now reside. When I answer the students with my perception of options rather than solutions, they tend to sink in their chairs and tell me that they feel overwhelmed not only with the daunting reality of the planetary situation but even worse, that they wanted me to offer them "hope", and are disappointed that I instead offer them responsibility. I tell them that since I don't have any "hope" it would be disingenuous of me to attempt to offer it to anyone else.

Pakistan, the heart of a global crisis

General Musharraf has declared martial law in Pakistan. Chuck Prince is being pressed to resign as chief executive of Citigroup, the world’s largest bank, apparently because of losses on sub-prime mortgages. The oil price has risen to $96 a barrel; the gold price has risen above $800 an ounce. That is the world in a nutshell, an international crisis, a credit crisis, an energy crisis and a dollar crisis.

Pakistan: Locally-produced gas prices should be de-linked from world prices

It is notable here that the price of gas has been raised by Rs 26 per kg during the past 19 months as a result of linking it to the international market.

The price of LPG is on inclining side in the international market and recent hike has passed all previous records. The producers' price of LPG has reached at $ 745 per metric ton from $655 per metric ton. The gas registered an increase of $ 500 in the international market during the last 8 years.

Hawiyah NGL project is now nearly 90% complete

The giant Hawiyah Natural Gas Liquids Recovery Plant (HNRP) Project is on track for completion, and to get all the key players on board for the final push, Saudi Aramco and contractor CEOs met recently for the in-depth review and work progress of the project.

Kurt Cobb: Let's play "Peak Oil Shock Me"

An increasingly popular parlor game among peak oil activists is to see who can serve up the most shocking morsel of peak oil news at any one sitting. There are now plenty of morsels to choose from on an almost daily basis. Here are some recent samples...

'Designer biofuels' may replace gas

The mysterious liquid potions that keep scientists at LS9 Inc. so busy at their crowded lab in San Carlos may be unrecognizable, but they someday might become the world's two most valuable fuels: gasoline and diesel.

South Korean firm exploring nuclear power plant in Philippines

A South Korean company has opened exploratory talks with the Philippine government on the possibility of reactivating the country's mothballed Bataan nuclear power plant, a company official said.

Energy Peril (Review of Renewable City)

In a new book, the author paints a dire scenario but he underestimates the pain of the solution.

The plastic fantastic recycling trap

It's the underlying assumption of modern design: Everything made by human hands will eventually outlive its worth. Consider, for example, the Swiffer. By almost every existing measure, it's better than mop, broom and dustpan. In fact, each single-use cloth is all but indestructible and no recycling program on the planet is equipped to deal with it. Point being: It's not the fault of the Swiffer, the failure is in the design structure of this fossil-fuelled age.

Pemex and Mexico Could Be Drowning in a Sea of Oil

Because of decades of mismanagement, corruption, sloppy planning and excessive waste, PEMEX (the state oil monopoly) is in no position to benefit from the market situation.

Wanted: Any enemy with oil

When Venezuela’s popular and democratically elected leader was removed temporarily in a military coup in 2002, Bush immediately recognized the coup leaders as the new government.

When Hamas won the last elections in Palestine, the United States refused to accept the democratic view of that nation.

Also, don’t forget, we destroyed democracy in Iran in 1953 because the Iranians wanted greater control of their oil.

Oil's Recent Rise Not Result Of Supply Or Politics, It's ...Traders!

Analysts also say that the past 10 weeks have demonstrated the power of traders at investment houses. Deutsche Bank oil economist Adam Sieminski, who spent six months on the bank's trading desk, said it is important not to underestimate the role of sentiment and technical factors, such as patterns of price movements and the need to hedge risks in other markets. Now, when investors hold a large number of options to buy oil at a price of $100, he says, "it's almost like magnetism. It draws prices to that level."

Ethical focus is booming

"Alternative energy has been the flavour of the year. A lot of people have woken up to what's going on in the world. Whether or not you believe in climate change or peak oil, it doesn't really matter. Governments can't afford to dismiss that a lot of smart people are saying.''

The Threat of Agrofuels – Industrialized GMO Monocultures Will Only Hurt Farmers

Modern corporate outfits demand high volume supply from industrial monocultures of corn, soybeans, sugar cane, and increasingly palm oil. Most ironic is to see the vehicles of organic co-ops driving around the Midwest powered by biotech agrofuels. Given how reluctant most people are to consume genetically engineered foods directly, the only other outlet for these dubious “wonder” crops is as high fructose corn syrup, factory farm livestock rations, or agrofuel feedstocks. In the research pipeline are agrofuels derived from yet other food sources – cassava, wheat, barley, as well as cellulosic ethanol derived from switchgrass, crop residue, and even biotech trees. Some scientists are also working on genetically engineered algae for agrofuel production.

Sleepwalking over the oil peak

If you are an avid listener of ABC radio you will hear the words "peak oil" pop out now and then with increasing frequency. Fran Kelly mentions it on Breakfast (John Anderson on food shocks oil dependency and drought), a caller to Australia Talks Back mentions it with respect to food prices, even news stories on oil are introduced with lines such as, "In a world with oil peaking…". ABC TV has broadcast its excellent documentary Crude, The Incredible Journey Of Oil. There are occasional articles relating to it in the Fairfax and Murdoch press. One could almost start to believe that peak oil consciousness is spreading into the Australian mainstream and that we can soon discuss how to prepare to cope with it rather than debate whether or not it will occur. But if you believe this you are wrong. The great majority of Australians have simply no idea that oil production will soon be decreasing, and the few that do mostly do not comprehend the extent to which this will change their way of life.

Kunstler: Ignoring the Obvious

Behind the hoarding dynamics are several clear circumstances. One biggie is the growing export crisis, described by geologist Jeffrey Brown. Countries like Saudi Arabia and Mexico that sell oil to importing nations like the USA and Japan are using more of their own oil and producing less. Mexico's trajectory is so steep (due to the severe depletion of its giant Cantarell oil field) that it could easily go from being America's Number 3 source of imports to zero in less than five years. The anticipated yearly growth in worldwide oil demand next year will equal 80 percent of the USA's entire oil production.

Cheap solar power poised to undercut oil and gas by half

Within five years, solar power will be cheap enough to compete with carbon-generated electricity, even in Britain, Scandinavia or upper Siberia. In a decade, the cost may have fallen so dramatically that solar cells could undercut oil, gas, coal and nuclear power by up to half. Technology is leaping ahead of a stale political debate about fossil fuels.

Declaration of Principles to Be Issued at the Third OPEC Summit

Heads of state and oil ministers from the 12 Organization of Petroleum Exporting Countries (OPEC) members will be meeting in Riyadh Nov. 17-18 for a rare summit, the third in the cartel’s history, at which they will hammer out the details of what is to be a historic “declaration of principles.”

Though petrodollar coffers are overflowing, there is no shortage of ominous clouds on the horizon providing a backdrop to the meeting: The diplomatic breakdown associated with Iran building up its nuclear technology capabilities, the ongoing war on terrorism along with conflict in Iraq, Afghanistan, as well as Nigeria and other OPEC nations, the increasing likelihood of a global economic slowdown and the U.S. dollar losing its grip as the world’s reserve currency among them.

Gore Nightmare Wins as Europe Pays to Ship U.S. Coal

Now that the price of coal is at a historic low relative to oil, there's no stopping consumers and producers alike from embracing Al Gore's nightmare.

A ton of U.S. coal is so cheap at about $47 that European utilities will pay $50 to ship it across the Atlantic, according to Galbraith's Ltd., a 263-year-old London shipbroker. While oil and coal cost the same as recently as 1998, West Texas Intermediate crude is five times more expensive after climbing to a record $96.24 on Nov. 1.

Valero reports L.A. refinery unit shutdown

Valero Energy Corp's 135,000 barrel per day (bpd) Los Angeles-area refinery in Wilmington, California, reported a unit shutdown on Friday afternoon, according to notices filed with state pollution regulators.

...A Valero representative was not immediately available to discuss refinery operations.

Average price of gas rises to $2.96 per gallon

The national average price for gasoline rose about 16 cents over the last two weeks, according to a survey released Sunday.

The average price of regular gasoline on Friday was $2.96 a gallon, mid-grade was $3.08, and premium was $3.19, oil industry analyst Trilby Lundberg said.

Yemeni tribesmen blow up oil pipeline

Yemeni tribesmen blew up a pipeline that carries crude oil to a Red Sea export facility on Monday but export operations were unaffected, security and oil officials said.

Contrarian Currency Trade: The Canadian Dollar

Peak oil aside (which I argued for last year, only to see crude price collapse), arguing about whether crude is worth $100 or $70 is another issue. Fortunately for long crude position speculators, this runup occurred during a time of seasonal weak demand for gasoline and heating oil, primary byproducts of crude which traditionally guide demand for crude. These depressed crack spread margins have enabled a runup to occur without demand destruction to immediately become apparent. Now at $96 crude and with RBOB gasoline cracks widening back from $2 to $6 (note a $37 peak crack this spring), wholesale gasoline levels are back to all time highs. This may put a damper in the bulls' optimism. Outside the US, Chinese are already rationing diesel. Demand is getting hit at these levels.

Tibetans wake up to nosebleeds in super-dry autumn

Moisture has become a luxury in the Tibetan capital of Lhasa where many locals are waking up to nosebleeds in the dry autumn, state media said on Monday as the Himalayan region faces growing threat of global warming.

"As it stands, there is little water component in the air in the Sunlight City which sits at 3,700 meters above sea level, making the weather extremely dry and things flammable," Xinhua news agency quoted the Lhasa Observatory as saying.

Tabasco background info from a human rights site. At least 10 years out of date. More at


The worldwide oil `crisis` of 1973 marked the start of a new era in Tabasco, leading to the intense exploitation of oil fields in Tabasco, Chiapas, and Campeche.

Since the 1970`s, the coastal plains of Tabasco have been blanketed with oil wells. PEMEX has drilled 3,588 wells in Tabasco, of which 1,013 are currently operational. PEMEX also operates 53 separation batteries, 31 compression stations, eight water-injection plants, five drying plants, three storage and pumping centers, and 13 natural gas collection centers.

There are three petrochemical complexes and a network of transportation tubes that travel through 1,249 miles of legal rights-of-ways that pass through heavily populated areas. The pipelines end at the port of Dos Bocas, where an estimated 450,000 barrels of petroleum are exported daily. In 1994, the average production from the south of Mexico (Tabasco and Chiapas) was 654,000 barrels daily, with Tabasco providing over 80 percent of that total. Fifty-four percent of Tabasco crude is high quality `Olmeca` grade, which obtains a premium price in international markets. The volume of natural gas produced by the region in 1994 was 1.946 billion cubic feet per day, with 1.325 billion cubic feet coming from Tabasco. Tabasco natural gas accounts for 37 percent of the national total.

The economic importance of Tabasco`s petroleum production for the federal government is clear. Between 1973 and 1992, approximately 4.864 billion barrels of oil have come from Tabasco wells, or an average of 666,503 barrels per day. In the last 20 years this production has generated $130 billion in profits for the Mexican Federal Government. Currently, petroleum production in Tabasco generates more than $4.6 billion of revenue annually. For comparison,cattle ranching, a traditional economic mainstay of the state that still utilizes seventy percent of state land, generates just $266 million annually. Despite the wealth extracted from Tabasco`s subsoil, the state ranks as the ninth poorest in Mexico, with 61 percent of its population living in areas designated as marginal. Eighty-nine percent of public investment in the state has supported petroleum infrastructure and operations, while only 5 percent of the population finds employment of any kind in the petroleum industry. Growth of the petroleum industry has not generated a multiplier effect in the state economy. Between 1970 and 1980, the contribution of agriculture, fishing, forestry, and cattle raising has dipped from 19.6 to 3.8 percent of state GNP, despite the dependence of 35 percent of the population on these activities. Twenty years of petroleum extraction that has lacked planning, environmental codes, and attention to social well-being have caused abnormal population growth, badly-skewed income distribution, tremendous escalation of the cost of living, forced relocations, andQmost alarming of allQenvironmental destruction and extremely hazardous living conditions for people who reside in petroleum-producing areas.

Some articles have Pemex saying their oil wells were not affected. Not sure how that can be, when 80% of Tabasco was underwater.

Other articles phrase it as, "they don't know if any of their wells are affected," which makes a little more sense.

Yes...this is a tad odd.

Oil is down as well today...expected at least a small movement up, given that no one truly knows the impact yet...ie. uncertainity.

But, nope...down 1.90 at the moment.

Does this mean they are going to be doubly surprized by this wednesday's weekly petroleum report?

The last two weeks have followed a pattern of oil dropping prior to the Wednesday report (oil dropped Tuesday the previous two weeks) - as much as $3-4, and then roaring back to higher highs following the "surprising" Wednesday report.

I don't get why it's a surprise, however. Robert has essentially told us flat out that the refineries will draw their inventories as much as possible in order to wait out these high prices, so why would anyone be surprised when we see another 3-5 mb draw this Wed? But, I am predicting oil will close above $100 on Wed due to this sort of dynamic.

Agree...this wednesday looks good to break that barrier.

Especially with $5 swings.

We will see.

This is profit taking time. In a few days prices will be up again.

Traders are focused on the dollar at the moment, not the inventory report. In trading terms, Wednesday's inventory report is far far far away. Bloomberg headlines quoted Mishkin of the Fed saying that the recent rate cut could be reversed if it turns out that it wasn't needed (this is b.s., but he's fighting to slow down the decline of the dollar). Plus, the dollar's recent descent was very rapid, and some amount of a rally has been widely expected. We saw the dollar come back a little bit today: http://quotes.ino.com/chart/?s=NYBOT_DX

Tell me if I'm out to lunch here, but having watched oil at >$90 the past two weeks and fall on Tuesday ahead of the inventory report, it seems like there's some fear and uncertainty that arrives just before the report comes out that maybe it will show a decent build, and thus people get out of their oil positions on Tuesday. Any truth in that, do you think?

You are not out to lunch. There is also a lot of poker in very short-term moves when there isn't a lot of volume. At record prices (for example in August when crude was approaching $78, or now), longs are always jumpy, and there is always some analyst providing a headline for them to get even jumpier about. When there isn't much volume, it doesn't take much buying or selling to move the price a couple of bucks. You sell enough to trigger selling, and you buy back cheap Wednesday morning for the inventory report. Or vice versa, depending on conditions.

But this kind of stuff doesn't really matter for very long. The longer a price is manipulated or based on bad information, the bigger the breakout once fundamentals are in charge again.

The wells are generally offshore and therefore should be ok even if currently not in production. It would be the loading facilities onshore that would be down for damage, lack of power and workers. Either way, the impact would be similar for the near future.

Hello Leanan,

Yep, it is sure hard to find detailed FF-info down Mexico way. A quick PEMEX google only brought back this:

Pemex and Mexico Could Be Drowning in a Sea of Oil
Monday, November 5, 2007

Recently Pemex’s outdated infrastructure was severely damaged by heavy storms in the southern states of Tabasco and Campeche, where the larger part of oil is presently being extracted. The storm caused total havoc by disabling two oil platforms, resulting in the death of 26 workers who could not evacuate because of inoperative escape pods. The squall also shut down the three main tanker shipping ports, impeding the exportation of millions of barrels of crude oil.
Obviously, the Mexican national priority is currently focused on saving lives, but if the FF-spiderwebs are badly tattered and difficult to repair: many more lives will eventually be lost. An example of this would be transport-fuel shortages so bad that the govt couldn't move essential food, bottled water, and medicine to the devastated areas.

I hope we can find more detailed PEMEX info soon, but maybe it is now a matter of national security; the data is purposely being suppressed to keep people from really freaking out at what might be happening soon. Who knows?

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

Regarding that link in your post, the headline writer obviously did not read or understand the story. From the headline, I got the impression that the story would be some cornucopean fantasy. The story is a pretty good review of the problems in the Mexican oil industry.

Hello Sterling,

Thxs for responding. Yep, my initial impression of the headline was the same, but if one peruses Pemex's sad history of oil & gas leaks leading to explosions and/or enviro-devastation, plus all the people currently treading in chemically and sewage-spicey Tabasco sauce--it makes more sense.

Here is just one example with photos:

The Guadalajara 1992 Sewer Gas Explosion Disaster

The blasts measured 7.1 and 7.0 on the Richter scale at the University of Mexico in Mexico City some hundreds of miles away, according to one report. (16)

About 7 miles of sewer pipe exploded. The worst damage at the street level was at Gante and 20 de Noviembre streets. Varley explains that “Gante Street marked the northern edge of an industrial area and the southern edge of an old, tight-knit, densely populated and relatively poor neighborhood in Guadalajara called Analco, which sat above Guadalajara’s sewer main—a pipe 18 feet in diameter.” (14) When the pipe exploded, several city blocks were reduced to ravines containing 230,000 tons of rubble. The blast hurdled cars and busses in the air, some of which landed on nearby rooftops. Adults, children, and pets suddenly dropped out of site beneath the concrete rubble. Easter vacation explains in part the number of children victims who had been playing on the street.
Imagine what detrito-terrorists could do in a major American city if they stole a gasoline tanker, then drained it into a major and critical sewer pipe.

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

91L is aiming at them again. Hopefully it will burn out over Honduras and Nicaragua.


More water would be bad at this point.

Got to hand it to wiki (the concept) -

Someone has already updated their page with info on the floods of 2007.


They can do a hell of a lot better than that on current events. The recent conflict in Somalia was written up at a quality that puts to shame some military history textbooks, in real time. I've seen pages sprout up with hundreds of newslinks, and multiple chapters, in a few days on current events. Geopolitics, however, is considered more encyclopedic than natural disasters, so it gets more attention.

Probably, the lack of coverage on Tabasco has something to do with the combination of lack of english, lack of electricity, the raw amount of land flooded, and pre-flood lack of internet access.

Geotagged Flickr, however, is relatively good for coverage of natural disasters.

Hello PeakTO,

Pemex's latest bulletin #159 [auto-translated by google]

PEMEX sympathizes with the brothers Tabasco
IMO, mostly aid-offerings--> no detailed damage assessment, nor mention of restored and smoothly-flowing FFs & electrical spiderwebs.

Sure would be nice to have an ASPO/MEX and/or TOD/MEX to post more timely and accurate info.

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

"A 10in (25cm) natural gas pipeline sprung a leak after flooding apparently washed away soil underneath it, but it was unclear if other facilities operated by the state-run Petroleos Mexicanos were damaged."


Tabasco is the NOGC of Mexico.

Mexico's exports go to zero in 5 years anyway.

This is the most censored story right now in America.

Pakistan running a close second.

From your Pakistan article:

In analysing a crisis of this kind, one should always bear in mind that nothing difficult happens unless there is a real pressure for it to happen. General Musharraf would not have instituted the state of emergency if there had been no Islamic militants.

Chuck Prince would not contemplate resignation unless the bank had lost a great deal of money. The oil price would not be more than $90 a barrel if there were no shortage and no threat of war. Gold would not be above $800 an ounce if people trusted the dollar. Real events force painful decisions to be made."

Carolyn Baker:

"Collapse is a multi-faceted word which I frequently use in my writing and speaking. It is important to use the word and not resist it because the entire construct of civilization is collapsing in front of our eyes. For example, the U.S. has not "entered a recession" but rather the first stages of global economic collapse. Our public schools are not merely turning out undereducated students, the entire educational system is collapsing. It's not that energy depletion will make it more difficult to "grow our economy," but rather that in reality, growth is over! Although we refuse to recognize our limits on planet earth, planet earth is setting limits whether we like it or not. As James Howard Kunstler says in "Escape From Suburbia" in response to Dick Cheney's maxim that "The American way of life is not negotiable," if we refuse to negotiate our way of life, then energy depletion will make sure that we get a new negotiating partner called "reality."

When we refuse to accept the fact of collapse, we armor ourselves from endless opportunities for personal and community growth. Perhaps other collapse watchers would prefer not to hear about "opportunities" inherent in collapse, but I feel compelled to name them! "

Thanx for your Good Work, Leanan!

Keep 'em comin.


Arkansaw of Samuel L Clemens

"Interventional Analysis" (www.interventionalanalysis.com) looks for footprints of central bank intervention in the markets.

One metric, the "DIVO", or "Dollar Index Value of Oil" is constructed by taking the daily closing front month Brent contract price, and adjusting it for currency fluctuations using the Federal Reserve's MCDI (Major Currency Dollar Index). A 100 day moving average of this DIVO value shows remarkably straight sections, typically with regression indexes > .99. It is claimed that this is evidence of the markets being steered by computer trading algorithms. Furthermore, the direction often changes on 50 day intervals, one of which is due right now.

I mention this today, because followers of Interventional Analysis was expecting the oil price to dramatically decline over the next two weeks, and low and behold, it started to do that last night DESPITE THE OBVIOUS CATASTROPHE in Tabasco.

It would therefore appear to IA followers that we have a test of wills between reality and the market steering algorithms going on. On the algortihms' side, we have a news blackout, and the usual MSM babble talk about "hedgers" taking profits. On the side of reality, we have refineries and significant oil infrastucture under water at our 3rd most important oil supplier.

I mention this if you are interested - not to start an argument about Interventional Analysis.


Reality has a tendency to catch up to traders, just as it does with Wile E. Coyote. If Mexico's exports really are down by more than half, and the ship watchers are right that there's not as much OPEC oil coming by 11/15 as people expect, the market is going to have a (c)rude awakening sooner rather than later (maybe the next inventory report).

A 10in (25cm) natural gas pipeline sprung a leak after flooding apparently washed away soil underneath it, but it was unclear if other facilities operated by the state-run Petroleos Mexicanos were damaged.


Arkansaw of Samuel L Clemens

Hiaku spasm...

Wile E Coyote
He's a super genius
Sues Acme products

SubKommander Dred

I have real reservations about US Government or US Government funded organization reports. Why would our government, the bureacrats that have suspended publication of M3, rigged the CPI so that food and fuel are not included, and injected many billions of $ into 'self regulating' Wall St schemes to temporarily avoid bankruptcy at the risk of spiraling inflation (currently not showing up in other government reports), stop at fudging on oil inventory reports?

Fibbing and fudging is a slippery slope...

Interesting, thank you.

More, H/T LATOC:

"Villahermosa is the axis of Mexico's oil and gas activities. Nearly the totality of oil and more than 90 percent of natural gas is produced within a 200 km radius of the city. Similarly, due its strategic location and accessibility, Villahermosa is an easy drive to or from the seaports that handle 95 percent of Mexico's crude oil exports.

One of the most relevant attribute of the state of Tabasco is that it is covered by water, and the capital, Villahermosa, is no exception. Nearly a third of Mexico's interior water runs through Tabasco and produces an important share of electric power.

Some of the O&G companies with premises in Villahermosa are: Pemex Exploration and Production (South Region, Drilling Unit, Engineering of Strategic Projects); Mexican Petroleum Institute (IMP), Schlumberger, Halliburton, Baker Hughes, Core Lab, Great Wall Drilling Co., Petrotec, Precision Drilling, CGG, among others.

Clearly, O&G exploration and production activities have been the mainstay of Villahermosa economy. This condition is being reinforced by the important set of exploration and production projects that are being developed both, offshore and onshore, in Southeast Mexico. The triplication of Pemex Exploration and Production (PEP) investment budget in Tabasco (from 2001 to 2002) illustrates this point."


Arkansaw of Samuel L Clemens

PEMEX has a good web site with monthly figures on Mexico's crude oil production, exports, etc.:

The numbers jump around quite a bit month to month, but they show Mexican oil production down 4% from last year, with exports down 4.7%. The latest month reported is September, so none of the recent flooding is reflected yet.

I didn't see this anywhere, and its pretty amazing.


its in spanish, and its NOT Tabasco, its a freak hail storm in columbia.

Under the picture is a link, its a couple of words (red in firefox) "view more" is a rough translation I guess. lots of other photos of lots of ice in Colombia.

And for the space buffs, comet Holmes the little comet that says I think I can I think I can is...

The comet has brightened over a million times.

The corona seems to be still growing.

right now its confusing as the data shows its much bigger than the sun now. It was at least 70 percent the size of the sun two days ago. It does have a "small" tail now, and its composition is under discussion.

This comet was supposed to be only a couple kilometers wide. so where is all this material and gas coming from for it to grow like this.

very strange indeed.

and one wag had a good line.

Comet Holmes has grown so large and is now the largest object in our solar system.

He suggested we rename it "John Holmes" in honor of its grandness.


link to a photo of the comet and its corona.

I'm almost embarrassed to post this, but The Google giveth ...


I think number three shows someone and the ice is deep,

and this is a link to a color photo of Holmes. very pretty and very large


the blue outside the main form is the tail.

Sacred Cow Tipper, LOL, you should be ;)

Though it is right out of "day after tomorrow" kind of event.

Cause follows effect in my experience. I have my own invisible friend delusions, but they agree with this statement.

I went outside to look and it almost seems a bit foggy - I can only see the really bright stars tonight. I think I see something new in Perseus, but I'm not all that up on constellation spotting.

Impacts of an Accelerating Shift from Oil Home Heating ?

Heating oil is currently used by 7 percent of American households, mainly in the Northeast, while about 58 percent use natural gas and 30 percent use electricity. In 1997, 9 percent used heating oil, while 53 percent used natural gas and 29 percent used electricity.

from an earlier DB link.


On the surface good, especially as 25 y/o furnaces are replaced by more efficient models. Electric can mean resistance heat in most cases and ground loop heat pumps in a few cases.

Best Hopes,


Unfortunately, these numbers shift in our part of the country.


"The impact of high fuel prices already is being felt through Maine's economy. Fuel prices are an important economic consideration in Maine because roughly 80 percent of Mainers heat their home with oil or kerosene."

I'm putting my 1st Solar Hot Air Panel up this week, and hope to get a few more put together before snow flies.


Here in the south, if you don't have gas heat, you likely have a heat pump. Certainly more efficient than resistance heating, but it only works well when it's above freezing outside. After that, it switches to resistance heating. Typically we keep the heater at a lower setting of 62F or so, and then have small heaters in the bedroom. At the lower temperatures, the central heat would be using resistance heating anyhow, so there's no loss for using the smaller heaters.

I'd love to have a wood stove in my home for heating, but it won't be happening until I build my next home.
~Durandal (http://www.wtdwtshtf.com/)


When you are ready for wood stove heat, check out Hearth.com for advice and stove reviews. Many active members...I am one with the same name as here.

I have been heating exclusively with wood for about 10 years, and its great. Just acquired some more acreage next door with a lot of oaks, so I should be self sufficient from here on out. I will actively manage the woodlot.

Woodstove technology has come a long way since the 70's. Mine produces no visible smoke, and I can heat 1500 square feet per year with 3 cords of wood in Eastern Virginia. We use it for cooking too!

We switched from a 32-year-old oil furnace to a ground loop heat pump. It cost a bundle, but was worth every penny. In February 2007, when it was below freezing at night for about three weeks straight (mid-Atlantic region, Maryland D.C. suburbs), our heating costs with the geo system were about one-quarter of what it would have cost to heat with oil.

Update on local gasoline jump (regular unleaded) Kansas City Metro (Missouri side):

- Jumped up $0.10 from $2.79 to $2.89 this morning.
- Diesel is at $3.25 (once again, the truckers/construction folks are probably not too happy).

It appears we are playing catchup with the national average. Although, this is not close to our all time high, it is hugely higher than last year at this time. As I recall we were well below $2.50 (I'll try to check history later today).

The Gas Buddy has accumulative prices for each state/large city. Also, current prices at each location and US and Canadian graphs for crude price/gas price.


the gasbuddy.com web site has another very interesting graphing capability:


You can customize the display at the bottom. If you set the chart to display only the cost of gasoline (I used USA Average) and then check the box for "Show Crude Oil Price", you get a display that shows some volatility for either one individually, observable upward trends over time, and an increasing gap between the two. In other words, the delta between the price of a gallon of refined gasoline and the crude oil from which it is refined seems to be getting bigger.

So, I'm a Peak Oil newbie, and I'm trying to parse all the commentary over the last few weeks as crude oil prepares to punch through US$100/barrel. Is this increasing difference due to speculation? Does it suggest a partial decoupling of gasoline prices from crude oil prices? Is the price of crude oil more supply driven and the price of gasoline more demand driven?


Had a significant jump in fuel prices here in Corvallis/Albany, OR. Now around:

~$3.15/gal for 87
~$3.39/gal for 92

~$3.55/gal for diesel

Diesel was as high as $3.59/gal in the Portland Metro area.


graywulffe, in CVO OR

Hey graywullfe - come into Soup Shop, 16th & monroe.

I would love to talk. Thinking of getting a local group together.

souperman2, sure, I'll drop by this week, probably tomorrow...


That's about what we're paying here in Northern California north of Sacramento/Santa Rosa. Except diesel is at around $3.39 and rising.

Yeah, the big price break between the coast and PDX is gone; I paid 3.04 in Yachats, but saw 3.07 as the low just outside Tigard, with most metro PDX at 3.09. The price differential used to be 25-30 cents/gal. I really wish gasbuddy would do the same for diesel as it has for gas. On my return from ASPO-Houston, I went through Death Valley and Yosemite; gas at Furnace Wells was just over $4, while gas at El Portal was 4.09, both regular. Diesel stocks seem to be limited globally, not just regionally. I think $4 diesel before Christmas.

Unleaded regular up $0.14 to $2.92 since Thursday (Nov. 1) afternoon at three branded stations closest to me here in Northern VA. Unleaded premium up $0.17. This is after prices basically held steady or slightly declined for the previous 4 weeks. Owners told me they have been warned of additional price increases of 8 to 10 cents a gallon by the end of the week if oil prices stay above $80 a barrel.

For a quick German comment - gas prices here have been fairly stable, roughly 1.35 euro a liter for regular gas, with a bit of shift up and down, for a couple of weeks. The rise in crude prices has not been reflected in gas prices, which is not very typical here in general. Almost gives you a feeling that something has changed inthe background, actually.

Just did my monthly fill-up with so-called "premimum" (marginal octane rating and chock full of ethanol) here in Sunnyvale California last night. $3.51/gallon. We haven't seen much of a rise over the last month compared to the rest of the country; instead, the rest of the country is just catching up a little.

What I have noticed is that food prices have been getting noticeably higher in the last 3 months. That makes me think that producers and transporters of food are successfully passing their costs onto consumers. That brings me to this question: why would truckers care about the price of diesel? If all transportation increases and transporting by truck is more efficient than by plane, shouldn't they be just fine with higher fuel prices? Are just the truckers with the least efficient trucks the ones who are complaining?

Independents are the ones complaining. The big shipping companies have payroll drivers whose diesel costs are NOT out-of-pocket. The difference being that indy's cannot pass on increased costs as easilly as Corporate shippers. It would be interesting to see how UPS and like shippers rates have behaved for some indication of fuel added costs.

SunnyvaleCA - Not sure what your financial situation is, but if you are shopping at Safeway etc you're paying too much. Good places to know about are:

India Cash & Carry on near El Camino and Lawrence - good for lots of staple Indian foods and especially good for those Tasty Bite meals in a box, except the good ones aren't Tasty Bite brand, they're Vimal and MTR. Those are often $1.25 or so each and add a bit of meat or fish and there's dinner.

That Taqueria & Supermercado on Fair Oaks, you know, that part of S'vale where no one speaks English, good tacos etc., and good meats. Vegs kind of expensive.

Coconut Hill Videos on Murphy near the Lace Museum, - chances are you'd hate Indian videos, but right next door is the coolest little Indian market, open 10 to 10 every day of the year except New Years. Since I no longer live in the bay area they need a token Caucasian and any place you can pick up milk etc after 9 PM in Sunnyvale is worth knowing about.

Lee's Sandwiches is an inexpensive place to eat, another good one to know about is Little Michoacan, a taquiria on Fair Oaks and Arques.

MicDonald's has a value menu, sausage mcmuffing w/egg is $1, get the "meal deal" and you'll spend almost $4 but get it by itself and it's a pretty good breakfast for someone on the go.

The Sunnyvale Farmer's Market is a good place to pick up veggies much cheaper than in the markets, and the Sikh folks up at one end dish up a great lunch for a reasonable price.

The people who are cooking at home and tracking their food costs are saving a TON of money. Can you believe I found it hard to stay down within $10 a day eating out there? That's $300 a month and I was easily spending more than 2X that. Start tracking your food expenses, you may be eating up a min. wage worker's take-home pay without realizing it.

The Journal of the American Medical Society, a leading peer reviewed medical journal, cites Peak Oil as a Public Health Concern

My husband was catching up on medical journals and found an editorial, “Peak Petroleum and Public Health.” (http://jama.ama-assn.org/cgi/content/extract/298/14/1688 ) and said, “Hey look, you guys have made it into JAMA.”

The editorial, which cites Hubbert, Hirsch, Kunstler, Deffeyes, Campbell and the usual; suspects, gives a brief description of the problem then identifies potential problems including medical supplies and equipment, energy generation and heat, food supplies and serious economic decline and potential conflict. It concludes:

“This transition will have far reaching effects across society. Within the health sector, direct and indirect effects will be felt on medical supplies and equipment, transportation, energy and food. Health professionals need to anticipate, prepare for, reduce, and adapt to petroleum scarcity to protect public health in the coming decades.”

Yeah, that was pretty cool. It was discussed in the Oct. 10 DrumBeat. Here's the EB article on it:


It includes a summary of the JAMA paper, for those who don't have a subscription.

It's interesting to see industry journals getting a good grip on the situation well before the politicians have publically. I have seen several articles from supply line and freighting journals talking about the situation.

The JAMA article was mentioned by Steven Leeb of Leeb Capital Financial Management during CNN's "In The Money" over the weekend.

VELSHI: Most folks know, when they fill up gas, what the price of oil, what impact it has on them, if you have heating oil, but it's way beyond that.

LEEB: It's so far beyond that, Ali. Recently, I couldn't believe that JAMA, which is the Journal of American Medical Association, had an article called "Peak Oil and Health Care," and the point of the article was that oil prices, high oil prices raise the cost of medicines.



This is the first time I've seen Peak Oil show up on CNN right out of the blue, and it's interesting that its coming from the financial community.

In the Money has been covering peak oil since about 2004, IIRC. They're a weekend "magazine" type financial show, and are allowed to wander further off the reservation than the straight news.

My daughter is a medical student, and because of the whole Peak Oil debate, a couple of years ago I mentioned in passing that she might want to consider specializing in very hands-on, practical, "old-fashioned" doctoring, as a lot of the super-expensive, high-tech, areas might come under a great deal of "pressure" in a post-peak world.

She's now concentrating on really basic medicine, the kind of stuff one could find oneself doing in rural Africa or South America. So I guess I've had some effect. Though on the other side many of her fellow students talk about nothing else but moving to the US as soon as they qualify and aim to make a fortune doing cosmetic surgery!

that was good advice to your daughter. I've said before that a physician from the third world would be more effective than any american physician stripped of his/ her technology. She's certainly making a better choice than her friends who are, by the way, delusional. They will never get into an American residency in plastic surgery- these programs are too competetive for foreign medical grads.

It's my opinion that the impact on drug/device supplies is understated in this article. True, drug components CAN be synthesized and when push comes to shove the medical products industry will be one of the last forced into rationing for obvious reasons. However, what may be severely affected is the outgoing quality of such products; namely potency, impurity levels, and sterility assurance. In our current, highly regulated industry, it's not just getting approval that's the hurdle. The manufacturing of these products relies heavily on controlled environmental conditions, validated and calibrated equipment and processes, trained and skilled personnel. FDA requires it, particularly when it comes to potency and sterility issues as these characteristics cannot be 100% verified in every tablet or every single use device. And even with all of these regulations, we still have problems. Just read the Weekly Enforcement Report at FDA's website. If any of these support systems become compromised, either safety and efficacy will suffer or availability will suffer. OR we begin to eliminate the unnecessary; the 15 brands of cold medicine available in gum, meltaway strips, liquids, etc...and focus on the 'important' drugs and devices. Now, who would get to make that call?

And then there's blood products....

All true, but in my view the bigger impacts of peak oil on public health will be indirect. Especially so in the USA. With "economic growth" blocked by lack of natural resources, we can expect rising unemployment, and falling real purchasing power for those still employed. (The latter causing more of the former in a re-inforcing vicious cycle called "depression".) The "health care system" we have set up will unravel because it is based on employment and for-profit organizations. Unemployed people will lose health insurance, and everybody will have a harder time affording whatever portion of their health care expenses is out-of-pocket. Even more indirectly but at least as important is that health status depends on a lot of other things besides "health care". Proper diet, for one, and that will suffer for economic reasons. Unaffordable "climate control" too. And the mental-health effects of the Long Emergency, serious on their own, will also have spillover effects into physical-health status.

I no longer receive JAMA. They mostly publish the stuff that NEJM and the Lancet reject. JAMA has a large readership of sorts bc/ it comes "free" with AMA membership but few docs really read it so I'm doubtful that this article will get much attention. Anyway, haven't heard any docs mention the article nor have I seen it in the abstracts/round-ups of the other journals I do read.

Anyway, some of our health problems are bound to improve with peak oil, namely obesity and its attendant morbidity.

Phineas Gage, MD

A couple of days ago I was at a dinner party with some interesting people. One was a journalist with a weekly radio show and another was an influential futurologist.

They were pleasant enough company, but they really didn't in my opinion, have a clue about either the present or the future!

For both of them, living very comfortable, priviliged, and successful lives, the present was forever. They both appeared to believe that we're in a way at the end of history.

One thing they were both in total agreement on was that the material level we have attained now, is only the beginning, there are wonders ahead! Materially, poverty has been overcome for ever. Sure, there will be minor adjustments to the economy, there will be "cycles", ups and downs, but we will never see anything like the Great Depression again. Capitalism is now universal, triumphant, and everything is managable. The only real question is, how rich do we want to be!

The famous futurologist was enthused about the prospect of everything we buy being personalized to fit our tastes and desires in the future, that is five or ten years from now. Soon we'll all have three dimensional "printers" that'll produce everything we need on command. The age of mass-production was over because of the digital revolution which meant that economies of scale wasn't relevant anymore because one could produce one thing just as cheaply as a million! We were at the start of a veritable Golden Age of plenty and freedom.

I must admit I felt profoundly depressed listening to them. They were both highly educated, highly intelligent and influential people. I began to feel like I was going mad, because people like them run the world. I had to leave the party early, as my wife had made me swear an oath not to say a word about oil for the entire evening!

In my experience most futurologists have absolutely no idea of what the future holds. But there is at least one exception, the LEAP2020 team, who've been right so far. This is their view of the near future:

Until June 2007, previous issues of GEAB anticipated and described the system’s sinking down and warned against upcoming collapses. From now on, our team will focus on anticipating the development of the seven sequences of the collapse.

In this month’s issue of the GlobalEurope Anticipation Bulletin (N°18, October 16, 2007), these sequences are desbribed in nature and timing. This timeline has also been gathered in a synthetic chart.

This public announcement provides the full description of the first sequence in addition to the complete list of sequences.

Sequence 1 - US debts infect the financial planet: A century after the « Russian loans”, meet the “American debts”!

Sequence 2 - Stock market collapse, in Asia and the US mainly: between - 60% and -30% in two years according to the regions

Sequence 3 - Bursting of global housing bubbles: UK, Spain, France and emerging countries

Sequence 4 - Monetary storm: Volatility at the highest / USD at the lowest

Sequence 5 - Global economy in stagflation: Recessflation in the US, soft growth in Europe, recession

Sequence 6 - « Very Great Depression » in the US, social unrest and the militaries’ growing influence on public affairs

Sequence 7 - Major acceleration in world’s strategic rebuilding, attacks on Iran, Israel on the brink, Mid-eastern chaos, energy crisis


I have reason to believe top politicians in Europe and probably elsewhere are fully aware of these predictions. What I don't know is how many take them seriously.

Maybe when this happens our interlocutors will have a change of heart:


I tried to find info on electricity in Papua New Guinea but found very little. According to the article you linked to they have power outages whenever a generator fails. Now presumably these are diesel generators. This begs the question how an oil and gas producer - and refiner - has such poor power supply that towers (with ministries in them) in the capital have frequent blackouts. Is this just a sign of how unstable grids in general can be? From the article you do get the impression that blackouts are a new thing, they didn't used to have them.

Writerman - William L. Shirer mentioned feeling like this while hanging out with high-ranking Germans in the 1930s. The most educated and influential people would all gether at these functions and cocktail parties etc., that he was sort of detailed to go to also, and they'd spend all night prattling whatever had been said that day in the German media.

That's a fascinating narrative. I had a similar discussion with the president of my school not too long ago. Your account of their version of the future is absolutely identical to the president's. There is no difference at all. I too held my tongue ... for the most part.

NEW DOE educational posters out:

They look pretty good as a non-technical overview to oil. One poster is all about Peak Oil, though they tend to toe the official USGS "later this century" line. Nothing at all in them about EROI.

The Origin of Oil and Gas
The Energy Revolution
Reservoir Drive Mechanisms
Drilling for Oil and Gas
From Reservoir to Refinery
US Oil Endowment
Global Oil Endowment
Unconventional Oil
Peak Oil - the Turning Point
Oil and Gas Reserves Evaluation

They aren't new. The peak oil one dates from Sept. 2006.

Sorry about that. I saw the mention on the Energy Bulletin, thus assumed they were new.

Nevertheless, they are a good resource to know about.

You aren't the only one. :-)

I'm kind of surprised EB took so long to pick up on these. They were previously posted here in the DrumBeat, and in the PO.com news section.

For the record, it's "Vox_Mundi" who first spotted these. He's a news spotter at PO.com, who spends a lot of time combing government web sites. He's found all kinds of interesting stuff. Dry, government PDFs that show at least some of our bureaucrats are quite concerned about the looming energy crisis, climate change, etc.

Anil Sethi, the chief executive of the Swiss start-up company Flisom,

Has a product he's gonna be selling that will make oil not worth pumping?

Well, bring it on. (Really. bring it) The only thing they did not claim was the film is made from soy bean oil.

Might he be wrong?

Yes, yes he might. Perhaps the copper interconnects to the panels can all be made from melted down phone lines when they are replaced with glass and the power lines are replaced with room temp superconductors to handle all the power coming from the solar paneled covered future.

One of the most fascinating aspects of The Drumbeat is keeping track of all the miraculous ways our future will unfold. It's so much easier to trust the wizards and magicians -- so boring to just work for a living:

The company's hopes center around a secret ingredient, a patented organism too small to be seen by the naked eye. When added to a fermentation tank containing sugar and other nutrients, the organism feeds on the materials and produces a viscous, yellow liquid similar to gasoline.

There are two or three other similar solutions to the apparent crisis that looms in today's Drumbeat alone. It cheers me up --hope it's ready for Christmas

My god, so simple! All ya need to have to do is gather up the sugar!

Bee fight!

(Oh and what do you have when you have a bear who's missing an ear? Yup B!)

...a secret ingredient, a patented organism...

The STUPID... it BURNS!!!!

Looks like their editorial policy is, "what people tell us, we print".

Is LS9 really that crazy? All animals have organisms in their body which convert sugars/food into gas. Don't believe me? Eat mexican food tonight see if you're not blowing methaneout your back end tomorrow. So who's not to say that engineers could not refine and develop these materials to simply convert sugars into gasoline. It not THAT farfetched.

I think the stupid he's referring to is that patents are not secrets.

Thanks speek. And Methane to Gasoline = Fischer-Tropsch = Been There, Done That.

It's really very simple and goes back to the first law of thermodynamics: energy cannot be created or destroyed. In this case it's the created part that applies. Pound for pound, sugar doesn't have the same energy content as gasoline. So no matter what alchemy you have, you're not going to produce gasoline out of sugar in any meaningfull way beyond what is being done with ethanol.


Pound for pound, sugar doesn't have the same energy content as gasoline. So no matter what alchemy you have, you're not going to produce gasoline out of sugar in any meaningfull way beyond what is being done with ethanol.

If you were somehow ADDING energy into the system, you could. But unless this microbe was taking photons and breaking down sugar for its Oxygen, then using the photons to excrete just C and H.....

We can eat and drink a variety of ingredients and produce a yellow liquid that can be added to our vehicles radiators. Does this suggestion warrant 'intelectual property rights' copyright or patent any more than the 'secret ingredient' mentioned above?

The snake oil salesmen are out in hordes...put your money in your sock while listening to their pitch!

If they have engineered a specific highly efficient bacteria for converting waste to biofuels, then yes it is intellectual property.


One can patent any DNA - so long as you are the 1st.

A utility patent on heirloom seeds are an example.

OK, I have to say it: Patents are Evil.

I know they started out as a great idea, but the whole system is today holding back innovation and getting faster evolutionary improvements out into the market. Patenting DNA and organisms was the final straw for me... I'm an engineer and have worked a lot in the patent field for the past 20+ years (I have several patents issued where I am the inventor).

Particularly in the medical device field (my specialty) patents keep prices high and prevent competition and product improvement. BS to the standard company whining about needing time to recoup their investments... it's all about greed and keeping the competitors at bay; NOT about what would be best for patients or consumers. The majority of R&D projects should have an ROI that pays for itself in 4-5 years. I am impatient by nature and a very successful practical engineering manager; most longer ROI's are only pipe dreams. A good start would be to REDUCE the exclusivity that patents grant to something more reasonable like 5-7 years, not the current 17 (in Internet time, 17 years is like a century). THAT would get innovation moving and we would see much more productivity and price reduction in key technologies. While we are at it, make copyrights have a much shorter finite time too.

Go to the Tinaja dot com website and dig around and find what Don Lancaster has to say about patents.

I'd tell you more, but then I'd have to kill you.

There is a distinct possibility that someone could engineer such an organism, but there are going to be a hundred dozen salesmen claiming it for each genius that actually gets the job done.

So this is cause for celebration ... but only when you see a traffic jam on CNN in front of the Capitol as they give away free product from a tanker while their suits are inside arm twisting Congress to pass some laws to help move the stuff into volume production.

Regarding the article about Anil Sethi and Swiss company Flisom, "it is based on a CIGS (CuInGaSe2) semiconductor compound that absorbs light by freeing electrons" or, in other words, we'll need lots and lots of copper, indium, gallium, and selenium. Not a problem for copper, but, AFAIK, the other three are geochemically rare elements (trace elements) that are normally obtained as by-products of mining for other commodities. In other words, their supply is probably inflexible, no matter how high the price for them rises (within certain limits). This factor might make putting such solar panels on every wall or roof a slight problem - they might not be so cheap in terms of raw materials costs, even if they are very thin. (Note: I haven't looked these elements up recently - just relying on my occasionally faulty geochemical memory here.) Comments by anyone with more knowledge would be welcomed.

"This factor might make putting such solar panels on every wall or roof a slight problem - they might not be so cheap in terms of raw materials costs, even if they are very thin."

The law of receding horizons again ??? The same wrong initial assumptions used for the canadian tar sands development are likely being used by this company.

I bet their cost assumptions about the future do not take into account the rapidly declining dollar and what (little) it might buy in the future, or rising costs of material due to competition within the same industry as well as other, unrealted industries that compete for the same materials.

As well as what you point out, the problems with rising cost of material imputs due to rising costs for any fossil fuel inputs for mining and refining materials as well as any fossil fuel inputs for the energy neede for the production process for the semiconductors.

Nontechnical solar is likely to rule the day. Devices made of unobtanium are going to be, well, unobtainable ... but everyone can round up some black paint, a piece of plexiglass, and an old car radiator (or a new one! :-) to build a simple solar heater.

We don't really face a technically complex problem on the energy front - a little black paint, a little weather proofing, and simply dropping all of our vehicles in favor of rail and we'll be there.

Mexico: Oil Reserves for 29 More Years

Mexico, Oct 31 (Prensa Latina) Mexico estimates having 45 billion barrels of oil between possible and verified reserves, which guarantees 29 more years of production at current extraction rhythm, said Mexican Energy Minister Georgina Kessel.

Kessel assured another 55 billion barrels which have not been explored could be added, and this would give Mexico a total of 100 billion barrels of equivalent oil.

This last calculation would raise Mexican oil production possibilities up to 61 years, she stated.

Kessel pointed the urgency to strengthen Petroleos Mexicanos by widening its legal, economic, and contractual resources.

"We have to be very creative, to ensure such oil reserves, and that is the future challenge for Mexican economy, she concluded.



See - there you are. All we need is more creativity.

Yah. I've got several million barrels of oil that have not been explored out under my backyard.

Washington Post article on Oil Prices

Free registration required I think

One key section

What makes the scenario more plausible than ever is that the world is consuming 85.9 million barrels of oil a day, but there are only about 2 million barrels a day of extra production capacity, almost all of it in Saudi Arabia. Much of that excess is a low-quality crude oil that can be used only in the most modernized refineries. That leaves the oil market sensitive to threats that might have been disregarded in earlier years.

Some experts say that high prices will change the balance, creating new supplies and lower demand.

"It's hard to keep in mind that things do move in cycles and that the laws of supply and demand are unlikely to have been abolished," said Daniel Yergin, chairman of Cambridge Energy Research Associates. "High prices, particularly if they become very high prices, will catalyze responses in supply and demand, and innovation," he said ...

But many oil experts say that this cycle isn't like earlier ones. A few argue that world oil is running out. Others note that China and India's economic advances and the growth of U.S. suburbs and exurbs have built in oil demand, even at high prices. Moreover, between 2005 and 2015, China and India's populations are expected to grow by about 240 million. That could soak up new production capacity that Saudi Arabia is currently adding

Hey, we got one sentence in a 3 page article in the MSM. PROGRESS !

Also note our friend Yergin is talking about demand destruction.

Best Hopes for Media Coverage,


The version I posted up top does not require registration.

Re: British survey on petrol prices

Double current prices - they suggest 1.86GBP/ltr!

In USD, this is $3.87/ltr or around 13.52 per GALLON!

In CAD, this is $3.60 per litre.

A couple comments on this:

1) Don't think we will ever make it those prices before other parts of the system begin to melt down or at least a BIG portion of the world will be in horrible turmoil if we are paying this much and its nearly BAU.

2) We are definitely addicted to the stuff. Must have it...at any price.

I live in the UK and focused on this article too. What I would say is that the statement may be true in the current economic enviroment. But if peoples budgets change from now as is expected when we follow the US into a housing meltdown (as our prices are a tad blown too) and the debt collectors start moving in to recoup losses on unpaid credit card bills as wer have a rising problem there too - then I think the situation will be different.

People may accept £1.10, £1.30, etc.... but will they also be a ble to cope when the food bills are rising along with the utility bills?. It is a conclusion wholly missed in the article that the cost of living must also go up for much food and utility bills if the price of oil pushed up the price of refined product!


Those in the UK would be able to deal with £1.86 per litre much more easily than the US would with $13.52 a gallon. Supply constrained pricing is going to hit the US hard, particularly when combined with a falling currency.

This is a good thing.

Well, this is a good thing if you're not in the US.

The world is going to use the US as both an object lesson and a breathing space. While demand destruction eats its way through the US 25% consumption the rest of the world will act to get its house in order and its alternatives scaled up.


Subaru doubles the battery range on its electric car concept

Bucking the industry trend towards Hydrogen fuel cells, Subaru has released a vastly improved second cut at a plug-in a battery-electric commuter car. The 65-kilowatt, 5-seater G4e’s new high energy-density lithium-ion batteries give it a 200km range from a charge (more than double the previous R1e’s range) and using a quick-charger it can be topped up to 80% in only 15 minutes. The new Subaru’s stats make it an instantly viable commuter, while underlining the exciting potential this fledgling sector will offer.

What a sweet looking ride. Plenty of range for commuters. Best hopes for a price under 30k.

Best hopes for a price under 30k.

Under 30k? Who the hell is going to buy these during a recession and with no way to use the atm in their living rooms (home equity) and who the hell is going to take the Lincoln Navigator etc. for a trade in when it is obvious that no one will buy these used? These will be luxury items for the wealthier citizens. The rest of us will be scrambling to get something used or the cheapest possible new car. Making them is one thing, selling them will be another.

An 80% charge of energy in 15 minutes to enable driving 200 miles - hmm! - I'm not sure how many amps that will be? - let's just say it's more than the average household supply can provide - so, 'Joe sixpack' won't have the electricty to charge it up either?


Sigh - this quick charge electric vehicle thing is like playing Whac-A-Mole. It calculates out to many hundreds of amps - It ain't gonna happen at home, and it won't happen in "charging stations" either unless there are major upgrades of our electricity distribution systems too.

Next we'll have a re-hash of the replaceable battery pack idea - if you cannot charge them quickly enough, then how big a facility do you need to store them. And when and where ARE they going to be charged? I know: we'll ship them by diesel truck to a power station where they can be recharged, then ship them back.

There will certainly be electric vehicles for some applications, but they will never replace the present ICE automobiles and allow us to continue business as usual. The fundamental difference that EV proponents miss is that refueling a car is not the same as recharging a battery - it is just moving "already charged" material, which requires very little energy to do.

You dont know how much energy is required to achieve 80% of full charge, so you can not possibly make any kind of 'quick calculations' to debunk the EV idea. Most practical EV scenarios have the consumer plugging the car in and charging it over night for around 6 hours.

Sure you can. If you know the mass and the performance, which one could guess at pretty accurately, then you can figure out how much energy will be required. Not too big a trick to figure what 80% of that is, nor work out the current required. or do you really think Subaru invented some sort of magic?

That is why getting consumption down under 100 wh/mile is so important.

This being America, most of us have AC and washer 220v outlets somewhere. If it's a 20 amp line, then we can push 4000 watts out the charger.

Now over a decade ago, the Solectria Sunrise, a compact-sized electric with a composite body, had a useful range of maybe 200 miles using a primitive 25kwh nickel metal hydride battery pack (http://en.wikipedia.org/wiki/Solectria_Sunrise)
so it must have operated at about 125 wh/mile. That was a 3000 pound car, so we have some room for improvement using modern batteries. Yet that indeed is about a 6 hour charge at home, if you absolutely must go 200 miles every time you leave home. I sure don't.

So the problem is, what will people do when they have to choose between vehicles with shorter ranges than they're used to, or $8 gas? I drive maybe once a week, but I'm glad my late Grandma's Cadillac is parked behind my house. If I had to commute daily less than 50 miles, the Cadillac is a disaster.

Now making these cheaply enough during a long depression is going to be awfully hard, unless we make the car light enough to cut battery and carbon fiber costs, and then we run up hard against the safety regulations. If voters could accept that oil really honestly was going away, then they could accept a speed limit under 50 mph, and maybe special lanes for low-speed vehicles. All sorts of problems are solved at once. I just can't imagine how bad things would have to get for us to do this, as opposed to the Japanese or Chinese.

Well, I've seen some of the silly designs floating around out there. I especially like the 3-wheeled, pointy front thing that was fussed about recently. Many assume perfect pavement, and are unlikely to survive the kinds of abuse a real vehicle must. This is what happens when you must compromise in the design to make up for the fact that your energy storage is limited, and that charging it takes a long time. Electric vehicles have been with us for a long time, and the engineering problems are still considerable, with range and charge time still two biggies.

There are practical limits as to how light a vehicle can be before one must go to exotic and expensive materials. For a 4-passenger car, maybe 1800lbs is about the bottom end. Figure maybe 40hp max is required. Sure lighter and smaller batteries will help, as you don't need to spend so much of your limited energy moving the energy storage media itself. But in the end you need a structure that is sturdy enough and not made out of exotic materials, a suspension that can deal with real life and not fall apart, glass for windows, doors with sturdy hinges, and some basic seats. This is the lower limit, then add your powertrain.

If you have to go to expensive, super lightweight materials to make it work, then you're not making a practical car for the masses.

Compare that to the same 1800lb vehicle with a 40hp common rail turbo diesel. These can be made now with existing technology and manufacturing. Maybe sandwich a small motor/generator between the engine and trans, along with a few batteries, and make it a 30hp engine. Make it a sturdy, inexpensive, and practical design so that people can better afford to replace their SUVs. Add lower speed limits as you suggest. Now spend the major effort on energy conservation (insulation, better windows, etc.), and electric rail.

The reason for the three wheel designs is to get around safety requirements. They are classified as motorcycles in most states.

I drive a GEM electric. It is good for 99% of my trips and uses lead acid batteries which are recyclable. If I have to go farther, I use my Toyota truck but it rarely gets moved.

"Compare that to the same 1800lb vehicle with a 40hp common rail turbo diesel. These can be made now with existing technology and manufacturing."


I don't see how your figures could apply to current auto technology being bought by US drivers. A horsepower (HP) is 746 watts. Most small cars of 3000 lbs require an engine of at least 75 HP for acceleration/going up hills and use about 25 to 30 HP going down the road at 50 to 60 mph. This means 746w x 25 HP equals 18650 watts energy consumption rate, or a 310 watt hours per mile at 60 mph. This could be reduced to your figure if the speed is reduced to only 25 or 30 mph, but how many people would be willing to limit their speed in the typical commute of 10 or 20 miles.

If really small cars are introduced in the US then perhaps cars could get the 100wh per mile figure. But I doubt that many US consumers would want to ride in such light weight cars. We can't even get them to give up their SUV's for smaller cars of present US technology. Then instead of paying for $8/gal gas they might just stay home rather than risk having their family travel in these super light weight cars they think are death traps.

Quickest way to reduce gas consumption in the US: increase unemployment and turn much of the middle class into poor people, just like in the great depression. This would work much faster than waiting for new technology in vehicles to take hold and it is a very possible scenario given the do nothing position of the current MSM and PTB.

Mark in St Louis, USA

Most small cars of 3000 lbs require an engine of at least 75 HP for acceleration/going up hills

The 1976-1979 Mercedes Benz 200D had a 55 hp engine and weighed about 3,000 lbs (slightly over 3,000 lbs per other W123 specs). Sold in Europe.

Strictly in the left lane on the autobahn :-)

Best Hopes for accumulating momentum,


But I doubt that many US consumers would want to ride in such light weight cars.

This is the dumbest thing I've ever heard, and it gets dumber every time I hear it. Not a critique of the poster, but of American society.

If it were a life and death struggle we'd see a $2,000/liter tax on new vehicles above 1.0 liters and a $1,000/liter resale tax. The funds would be directed to rail electrification and it wouldn't take very long before the problem would be solved.

We'll discharge a whole bunch of nuclear weapons all over the ME before we do something so sensible, but its where my head is at ...

Did the list those parameters? No? You don't know either, thats the point :P

Actually, YOU don't know, and that is because you're a party guy.

Sigh.. < Good, Visually Dramatic Writing!

I doubt that Subaru is designing a system that will expect homeowners to have more than a 100-200 amp service. No matter how much you want to roll your eyes, I think you'd have to realize that they're aware of what kind of powersources will be available.. The quickcharge up to 80% is probably starting at a 50% or so discharge, since you never fully discharge batteries if you want them to survive.

Yes, we'll have a rehash of replacable battery packs, since it is an idea with a lot of ways of working. It could be you'd own a second pack yourself that can 'roll-on, roll-off', and charges during the odd-days, or is your spare capacity for when you need extended range.. or you'd rent them, etc. You make it sound like 'replacing batteries' is a ridiculous suggestion, or that it would be too hard to store a bunch of racks of batteries and make them accessible as a roadside shop.

No, it won't replace all the cars on the road, and it doesn't have to to be a potentially viable business. Similar to the guideline for Impalas, who don't have to outrun the Cheetah, they just have to outrun ONE other Impala.. Electric cars don't have to replace the whole transportation fleet, they just have to sell enough cars to justify the business of making them.

"The fundamental difference that EV proponents miss.." That's a big group you're lumping into one obnoxious assumption.. Many EV proponents understand very well that this 'Already Charged Material' is ultimately less efficient and less clean with a weak future than is electricity.. while being simply much more convenient than having to pump up a battery pack again and again. So the need to be more attentive to your state-of-charge, your battery health and your charging schedule is worth the effort as the older alternative gets less and less dependable..



If the range is 120mi, then I assume that includes stopping at the lower charge limit, whether that be 50% or 20%. If the charge time they give does not correspond to the range they are using, then it is BS.

Here is my point: Yes, we'll need EVs for some uses. But fundamentally, we need to move past the automotive personal transportation idea. Substituting electric vehicles for ICE powered vehicles is essentially just switching from one fossil fuel to another so as to continue a failed paradigm, and at great cost of infrastructure replacement. If you want to propose that the electricity will be generated by renewable sources, then we will be WAY too capacity limited to waste it on EV's - and besides, we're going to use coal like there's no tomorrow.

So no, I'm not too excited about a $30k - $50k coal burning toy with a 120mi range. We have real, serious problems to deal with, and they go way beyond having to give up cars. We need to use our limited time to work on those issues, not be distracted by building the next fossil fuel powered cars.

EDIT: Here is my concern with EV's: What are EV's a solution for? They may be a solution for the problem of how to power vehicles after gasoline becomes scarce and expensive, but we have much bigger problems to deal with. It's important to recognize that the entire automotive society was massively subsidized, and that maintaining it and changing it over to EV's would need to be too. Given how far behind the curve I believe we are in regards to preparations, I would hate to see much effort wasted on this.

What are EV's a solution for?

Even from coal fired watts, their Carbon emissions are (as far as I've read at this site) better than ICE's, to start with, and could even the day to night loads for some generation.

'Bigger Problems'.. no, just OTHER problems all coming in at the same time. The role of cars will change, but guess what? Wheels and motors are not going away. Transp fuel is clearly a KEY problem.

'Coal-Powered' .. Uh huh, and Wind powered, and Solar Powered, and Nat Gas powered, Wave and Tide, Hydro ... Electric is actually an ALTERNATIVE to current transport options, with a wide choice of sources for it, many of them clean and proven (just small so far, but not limited by much more than our lack of forethought)..

'Toy'.. if it is used to do work, then it is a tool.

'Wasted Effort'.. electric vehicles are effective, uncomplicated and clean. A good effort, I'd say.

Even from coal fired watts, their Carbon emissions are (as far as I've read at this site) better than ICE's, to start with, and could even the day to night loads for some generation.

I am skeptical of this claim when an EV is compared to a modern ICE vehicle of similar size and performance (assuming one could be found), and the entire generation and transmission cycle is considered. This is why I believe it is just a fuel substitution.

The claim is correct.

When compared to a conventional light-duty gasoline-powered vehicle,PHEVs with 20-mile electric range and charged with 100% coal-fired electricity would reduce well-to-wheel CO2eq emissions by 26% and battery EVs would cut emissions by 40%, based on an analysis performed by the Electric Power Research Institute (EPRI) and the National Defense Research Council (NDRC).
Environmental Assessment of Plug-In Hybrid Electric Vehicles, Volume 1: Nationwide Greenhouse Gas Emissions. EPRI, Palo Alto, CA: 2007. 1015325. http://www.epri-reports.org/Volume1R2.pdf

This is supported by another report to the California Energy Commission, where a well-to-wheel analysis found that CA electricity use for vehicles reduces GHG emissions compared to gasoline-powered vehicles by 48% in plug-in hybrid electric vehicles, and 72% for battery electric vehicles.
Full fuel cycle assessment: well-to-wheels energy inputs, emissions, and water impacts. Alternative Transportation Fuels Plan Proceeding, prepared for the California Energy Commission, REVISED: 8/1/2007, CEC-600-2007-004-REV. http://www.energy.ca.gov/2007publications/CEC-600-2007-004/CEC-600-2007-...

Thanks - I'll read the kinks.

Meanwhile, electrified rail (Urban & Freight) have CO2 reductions in the ~90% to 97% range (vs. 26% to 40%).

Urban Rail includes TOD effects, which are stereotypically larger than the direct substitution savings.

Best Hopes for MASSIVE CO2 reductions,


Yes, if you want to start and end your trip adjacent to a rail line.

For geting from point A to point B, or getting from point A to a rail line, and from a rail line to point B, you'll likely need an EV (be it a car, bus, or NEV).

I walk.

Roughly one third/30% of Americans want to move to TOD. TOD is, by definition, within walking distance of Urban Rail stations.

From memory, the new Greenbush commuter rail line outside Boston will have 20% of their riders walk-up.

Best Hopes for Pedestrian access,


Still reading the first one, but a few things I note right off:

1. This study does not consider EVs, only HEVs (which are ICE powered vehicles), and PHEVs of 10, 20, and 40mi electric only range.

2. They are comparing 3600lb HEVs and PHEVs to a conventional automobile (of same weight) that gets 24mpg. This is not the comparison I was suggesting. The design constraints are much different for a PHEV vs. a pure EV. The former has an ICE, and so has no range limitations, and therefore its design does not need to be compromised in the sames way (witness the 3600lb weight). It also only has a max distance of 40 miles, and so it will be burning gasoline for much of its use.

3. Overall, the assumption is that all the 3600lb vehicles got 37.9mpg, except the CV, which got 24.6mpg. A CV of equivalent passenger volume should be much lighter than 3600lbs, and could get much better than 25mpg.

4. In their data, they show the PHEV20 as traveling 12000mi/yr, and 5898mi of that are on battery alone (nearly 50%!). If one travels to work 230 times, the assumption is that one got 25.6 mi of battery only travel per day. YMMV.

5. Studies funded by so many utilities and other interested parties make me skeptical. There are a lot of assumption in here, and it takes a lot of effort to unwind them all.

I have to read the CA study yet, but I'm still not convinced. I would like to see a well-to-wheel GHG comparison of an EV (which will be small and derive all of its power from the AC system) with a CV (Conventional Vehicle) of the same weight (ballpark 1800lbs) and a very small diesel (certainly should do 50mpg). In this case, the EV will derive more of it's power from coal, and the diesel will of course use diesel.

4. In their data, they show the PHEV20 as traveling 12000mi/yr, and 5898mi of that are on battery alone (nearly 50%!). If one travels to work 230 times, the assumption is that one got 25.6 mi of battery only travel per day. YMMV.

Considering that the average commute in the US is 32 miles, their number does not seem unreasonable.

I would like to see a well-to-wheel GHG comparison of an EV

Tesla Motors has done this for their sports car, and they include a number of other cars, including the 4-cylinder diesel Volkwagen Jetta and the 4-cylinder gasoline 1993 Honda Civic VX, which gets 51mpg.

The EV has 1/3 the emissions of the next-best cars (Prius and Civic VX). And, acceleration-wise, out-performs the Porsche and Ferrari.

One caveat is that Tesla assumed natural gas was used to generate the electricity, and natural gas has about 40% less carbon per btu than coal. Even taking that into account, though, their results indicate that a coal-fired EV sports car emits half as much as even the most efficient CV regular cars.

I think to assume that a car with a 20 mile electric only range gets a consistent 25 mile daily electric only performance is a stretch...... OK, we'll give them the benefit of the doubt and assume that the vehicle made many more trips. But how about hills, or cold weather, or I forgot to plug it in, or long trips, etc.?

Also, a HEV or a PHEV is going to be larger and weigh more than the CV equivalent (must make room for the motor/generator, batteries, and controller). Since this report considers vehicles that are not yet available, and even available ICE powered vehicles can get 50mpg (twice their assumption), then these choices of vehicle specification lead me to think there was an agenda here.

As for the Tesla - honestly, I could really care less about a sports car, nor its acceleration numbers. I cannot imagine anything less relevant to our future. Come back when they've made an affordable 4 place vehicle of similar spec to the Civic or Jetta that can be made in quantity. That little thing weighs 2600lbs even with the aluminum chassis. Build something out of affordable materials in 4 place form, and it will be quite porky indeed. Then power it with the present mix of electric generation, and see how it stacks up.

The original question was whether EVs provide a GHG improvement, and I still have not seen anything that shows they do, when compared to an equivalent CV.

The original question was whether EVs provide a GHG improvement, and I still have not seen anything that shows they do, when compared to an equivalent CV.

Then you haven't read the link I provided; I suggest you do.

Your complaints about the cost of the Tesla Roadster are irrelevant to their analysis of the energy efficiency and CO2 emissions of an electric drivetrain vs. an oil-burning one. They provide all the necessary framework for calculating relative efficiency and emissions for any power consumption level, meaning you could look at the data on any EV, plug it into their equations, and come out with the answer you say you're looking for.

Don't expect the answer to be any different than the one I've given you, though, as their Wh/km are pretty typical as EVs go.

It's pretty simple really - the Tesla is being compared to completely different types of vehicles. If the Tesla were and affordable, 4 passenger vehicle like those it is being compared to, to would perform much worse, if only because it would be much heavier.

If the Tesla were and affordable, 4 passenger vehicle like those it is being compared to

Like the Porsche, Ferrari, and Corvette?

You're just plain wrong, and if you bothered to read their math, you'd see that.

As I said, I did not pay attention to the comparison to the sports cars, which were not designed for efficiency or low emissions, as I could care less and they are irrelevant to the conversation. I looked at the comparison to the Honda and the VW. You have introduced a strawman - OK, so the Tesla sports car is superior to a Porsche, Ferrari, and Corvette when it comes to efficiency and GHG emissions. Who cares? The results do not necessarily translate to vehicles that actually were designed to have high efficiencies.

You apparently do not understand how various constraints must be jugged in designing a product. It is clear what will happen when they try to design a car that must have a much lower price tag and a practical passenger and cargo configuration.

sports cars...were not designed for efficiency or low emissions....I looked at the comparison to the Honda and the VW

Let's break this down into simple pieces:

1) Sports cars are - according to you - not designed for efficiency.
2) The Tesla Roadster is a sports car.
3) Thus, we should expect the Roadster to be less efficient than a non-sports-car EV.
4) Thus, using the Roadster as the EV point of comparison should be on the upper end of energy consumption and emissions for a car of that size and weight.
5) The Honda and the Jetta were selected because they are unusually fuel-efficient, and hence should be on the lower end of energy consumption and emissions for all oil-powered cars.
6) Less than half of electricity generation is coal-fired, meaning using coal's emission statistics for electricity generation will over-estimate the emissions of an EV.

With the deck stacked against EVs three times, they still come out ahead by a factor of two.

Let's make a more direct comparison, though - a 1999 Ford Ranger converted into an EV with a regular 1999 Ford Ranger.

EV: 315Wh/mi
CV: 16mpg

At 34.3MJ/l and 3.8l/gal, the CV is consuming 8.1MJ/mi. At 3600J/Wh, that corresponds to 2,250Wh/mi. So, comparing identical vehicles, the EV is seven times more efficient.

How does that correspond to emissions?

At 73g/MJ of CO2 for burning oil, the gas-burner is emitting 590g of CO2 per mile. By contrast, burning coal for electricity emits 0.95kg/kWh of CO2, meaning that the EV Ranger emits 315/1000*0.95 = 299g of CO2 per mile - half as much - even assuming 100% coal-fired electricity.

As coal represents only half of electricity generation in the US, though, the actual value would be much lower than that; 49% coal, 20% NG, 20% nuclear, 7% hydro, 2% renewable, and 2% oil means the total amount of CO2 per kWh would be 35% lower, or just 200g per mile.

The EV Ford Ranger is 7 times as energy-efficient and 70% less polluting than the regular Ford Ranger.

And, lest you start complaining about performance, the EV Ranger has a top speed of 75mph and a normal-driving range of over 80 miles. It's a more than capable vehicle for the vast majority of people.

You're just plain wrong, and anyone can check these figures and prove your wrongness to themselves.

What are EV's a solution for?

Beyond transportation, initially a means of storage to increase the broader use of intermittent renewable energy.

When the EV market achieves scale, batteries will have come down sufficiently so that sticking 35 kWh at home or larger sizes at community centers and schools, we will have distributed stationary and mobile energy storage, and we can take renewables up to near 100% of enengy demand.

No more FF. The 2050 vision. I'll be dead.

But fundamentally, we need to move past the automotive personal transportation idea.


You appear to really dislike cars, but that really has no bearing on what society will do. People appear to like personal freedom in transportation, and will continue to try to find ways to get it.

Substituting electric vehicles for ICE powered vehicles is essentially just switching from one fossil fuel to another

Or to nuclear, or to wind, or to solar, or...

Electricity can be generated from almost any energy source, meaning changing infrastructure to be based on electricity is likely to be the last fuel change that'll need to be rolled out on a wide basis like that.

If you want to propose that the electricity will be generated by renewable sources, then we will be WAY too capacity limited

Your evidence for this is?

The current trend for wind power (based on fitting a logistic model, which is a standard method for estimating the uptake rate of new technologies; see this thread for data, equations, and references) is for 10% of world electricity to be generated from it by 2020, even taking into account growth in supply. That's about 2,000 TWh per year, or - at 125Wh/km station-to-wheel - enough to drive a billion EVs 16,000km each.

And that's assuming business-as-usual; serious trouble with fossil fuel availability is likely to make adoption of renewables speed up.

The key here is that EVs are simply much, much more efficient than normal cars - roughly 10x - so the amount of energy needed to power a world full of electric cars is much less than you might think.

besides, we're going to use coal like there's no tomorrow.

Even a coal-fired EV releases much less CO2 than internal combustion cars.

What are EV's a solution for? They may be a solution for the problem of how to power vehicles after gasoline becomes scarce and expensive

Essentially, yes. They're a form of personal vehicle we can use without the need for fossil fuels.

It's important to recognize that the entire automotive society was massively subsidized

Please provide evidence that the level of subsidization of cars is unsustainably large. You may not like how society has evolved with access to inexpensive cars, but that doesn't automatically mean it can't stay that way.

[jokuhl] The quickcharge up to 80% is probably starting at a 50% or so discharge, since you never fully discharge batteries if you want them to survive.

Different battery technologies have different pathologies.

Lead-acid you dont drain to the death. Ni-cad you DO go all the way - but don't leave them empty for a long time. If you didn't flatten Ni-cads you lose capacity.

That was the 'memory effect' cure, and as I understand it, is not what you want to do to a NiCd. As Film Grips, we used to grind our Makitas down to the last grunt, but there's a great hazard to killing the cells when doing this repeatedly.


"...Quick charging helps negate the effect of NiCd memory. Second, be sure to fully discharge your batteries to their 1 volt level, under a light load, on a regular basis.

Cell reversal is a condition that can occur with multiple NiCd cells connected in series, such as in a multiple cell battery or a battery pack. Since not all cells are exactly the same, one cell in a chain may use up all of its charge before the others. As the pack continues to be used, a reverse charge is sent through the empty cell due to its charged neighbors. This reacts the water with the cathode, bonding the oxygen to the electrode and releasing hydrogen, which is then vented. This loss of water reduces the life of the cell. To prevent cell reversal, don't perform a deep discharge on a battery pack. It is save to cycle an individual cell to zero volts. In fact, timing the discharge cycle of a cell is one way of determining its exact capacity. With this information, a cell can be matched with other equivalent cell into a battery pack that is less prone to reversal. .. "

So while you can drive a cell to zero, in a series of cells this makes it much more likely to drive individual cells into reversal. As it says in the first para above, 'Full Discharge for a 1.2v cell is considered to be 1.0v

As a homeowner user, I used to kill my Makita packs by charging them up, then using the tool a bit, leaving 95% if the charge still in the battery.

Then I would ignore the tool for months. Then use the tool again, and so on, till I needed to charge it again. I rarely got more than a dozen recharges to a pack.

I dissected a few spent packs and discovered two or three cells of each pack destroyed. I tried to "zap" them with a high current pulse to open their internal shorts, but even then they had little capacity and soon failed again.

Then I discovered that the root cause of the failure was the remaining good cells had a lower self-discharge rate. I recovered those cells and now use them in my Gardner-Denver wirewrap guns, which use two cells each.

I then built a "trickle charger" in the case of an old Makita charger, Its nothing more than a 15 volt DC "wall wart" supply in series with a #327 (28 volt 40 ma) indicator lamp wired to the battery charge terminals. I leave the battery in there, leaving about 10-15 mA going to the cells ( the filament glows a dull reddish orange - no where near rated luminosity ).

Its been working for five years now on the same battery pack. The cells seem to deal with a slight trickle overcharge much better than than dealing with cell reversal due to self-discharged cells.

I no longer used Makita's charger unless I have a freshly discharged pack I knew I had been "equalized" on the trickle charger. The reason is that if I had some weak cells in series with nearly full cells, the whole pack - including the full cells - gets a heavy dose of current until the whole pack comes up to some specific terminal voltage or the pack heats up.

Don't get me wrong. Makita has an excellent design for the tradesman - it will keep the batteries in a frequently cycled tool charged promptly. My problem is how I was using the tool that shortchanged my battery life. Makita did not design that tool to sit in the drawer most of the time - like I do. I figure it would take my charger at least a week to charge the battery.


"Makita did not design that tool to sit in the drawer most of the time - like I do."

You sit in a drawer? Odd fellow :)

I've been reviving my Makitas in a few ways lately. I ended up getting 2 more of the 9.6v guns, since the work I do in my shop often has me using a variety of tips, so I just tool up diff't guns with difft tips. I also use a Makita flashlight, and have plans to turn some other makita tools into Battery Radios, various low-voltage motor appliances like sanders, sharpeners, Kitchen Blender perhaps, jig saw, closet light or worklight (Fluorescent)..

I am using a test circuit from a French experimenter for 'Smart' pulse charging Nicds and other chemistries that has so far been able to rejuvenate some pretty crushed packs, and seems to be a really healthy charge for all the others, so like you, I gutted an old Makita charger (having three).. and fill most of my batts on that now.

I just want to find a way to rebuild the 9.6v packs when it's time to change cells, without demolishing the old shell.


It calculates out to many hundreds of amps - It ain't gonna happen at home

It's not as improbable as you suggest.

The Tesla Roadster - a high-performance sports car - uses 133Wh/km on the EPA highway cycle, suggesting that 100Wh/km is a reasonable estimate for a smaller EV.

At 200km per charge, the vehicle in question here charging up to 80% is about 100km - since I doubt they're measuring from totally empty batteries - or about 10kWh of power. Over 15 minutes, you'd need 10kWh/0.25h = 40kW / 240V = 167 amps.

A typical modern house is wired with at least 100 amps, and can be upgraded to 200 amps for not much (~$2,000), so the notion of quick-charging an EV at home is not wildly outside the bounds of reason. Indeed, it looks like most homes could have a charger installed with relatively minimal refitting, although many of them would have to be careful about turning off any other major appliances during those 15 minutes.

For comparison, central air conditioning systems require 3-20kW, and so the hypothetical quick charger is within a factor of 3 or so of common household electrical equipment. Based on the air-conditioning-needs worksheet at that link, a typical house in Pheonix, Arizona would use about a 10-20kW system, so appliances of this magnitude are not at all out of the question.

it won't happen in "charging stations" either unless there are major upgrades of our electricity distribution systems too.

Based on what do you assert this?

Quick-charging an EV requires about the same amperage as a single house is rated for, suggesting that even pretty substantial EV market penetration wouldn't change electrical distribution needs all that much. If 10% of homes had an EV, that's a 10% addition to the peak amperage needs of the neighbourhood, which is not so enormous. It'd be like 30% of the homes getting central air conditioning.

Actually, it'd be much, much better than that, since people are all going to turn on their air conditioning at the same time - when it gets hot - whereas quick-charging their EVs is likely to be spread out much more during the day, and is for much, much less time.

So your assertion that this can't be done really needs to be backed up with evidence.

The high performance sportscar is also a highly aerodynamic two-seater composed of carbon fiber and priced as a supercar - and you're not getting that number of 133 wh/km from running it at its maximum speed.

Aim for 150wh/km in an average small fourdoor high-safety boring EV. EV conversions of sedans are generally around 200, based on the few cases I've seen. The low end they were aiming for on the VentureOne, a streamlined tandem 2seat, 3wheel motorcycle-class vehicle, was IIRC 107wh/mile, or 67wh/km.

Aim for 150wh/km in an average small fourdoor high-safety boring EV.

Sure, let's take 150Wh/km. That changes absolutely nothing I've said - all it does is tweak the numbers a little. It still puts an EV quick-charger roughly on par with a house in terms of power draw, meaning that there's no reason at all the grid shouldn't be able to handle large numbers of them, just like it handles enormous numbers of houses.

Actually, it's about 100 miles (80 percent of 200 km), but your point is still valid.

I am all over my girlfriend about this - a Blazer with 110k on it that could be sold now for what she owes and enough in the bank to pay cash for a new Aveo if she must have a Chevy. One of these days it will be Just A Little Late(tm) to unload such machines. My SUV (inherited) is six months gone and while I wish I'd bought something cheap and used I'm glad to be free of 18mpg.

Any chance you can talk her into a Toyota Yaris? about 40mpg and very inexpensive.

We drove a Corolla. She thought the Yaris was funny looking. I suspect she is going to be something small and used ... she has lots of cash at the moment, but is country girl conservative about what she does with it.

Being conservative is a very good idea.

Right now I don't go much of anywhere and borrow the truck when I do - overall gas useage is very low.

I kind of have visions of picking up a 250cc motorcycle, Suziki makes a nice little cruiser actually. I'm not a big fan of cruisers but they're practical - easy to carry stuff, don't tip over as easily as rocket bikes, and actually cheaper to insure. I can insure something like that for about $200 for the whole year.

The fuel to run your vehicle is chump change compared to the capital costs of the car. That's why you will see many SUV's on the road even with $5/gallon gasoline. Even with $10/gallon they won't dissapear, just go to London and you'll see.

Phil: You are partly correct. Here in Toronto (like London) it is common to drive your car 7000 miles a year. Supposedly the average USA family has two cars each driven 20000 miles a year (6X as many miles).

We traded in the SantaFe a little over a year ago for a Spectra5 on exactly this logic. Bought 4 snow tires. Our monthly payments are much lower, as are our fuel costs. And we won't be faced with unloading an SUV (even a small one) when everyone else is.

Have her switch to a CUV if she must have a "larger" vehicle. If she must have AWD, Subaru's get respectable mileage for having AWD, and have awesome safety ratings. 28mpg is much better than 18mpg. As you said, unload it while she still can. Heck, just getting out of a car note and into a car that's paid off is a world better. A used Accord or Camry gets you out of a payment and into higher MPG.
~Durandal (http://www.wtdwtshtf.com/)

Not a lot of hope in the short term for under 30K.

That battery pack alone is about 20K using current VOLUME pricing. Of course, it will come down a bit over time...but then there is inflation...so prolly balance out.

Would like to know more about the quick charger?

Regarding quick charging:

AeroVironment (the guys that actually built the EV-1, and some of whom appear in "Who killed the Electric Car") and Altairnano have been working on 10-minute charging systems, demo's in Norway and elsewhere. See the news section of each's website. AeroVironment's is www.avinc.com .

Why 10-minute charging? That get's you ZEV III status, the gold standard. Worth a "ton o' money" in credits.

What do you get out of posting this happy horsecrap? You know damn well that this will never be cheap or useful enough to ever be commercially available. Our near term future, if we don't have complete collapse, is going to be very small gasoline, diesel and ethanol cars, with high end vehicles being hybrids.

What do you get out of posting this happy horsecrap?

A paycheck?

I damn well do not know that and neither do you. You will state here publicly that in 10 years there will not be a substantial amount of electric cars on the road (measured at least in the 100's of thousands)?

a substantial amount of electric cars on the road (measured at least in the 100's of thousands)?

Substantial??? Hahahahahaha!!!

If you want to be an anti-doomer, you'll need to do two or three orders of magnitude better. 100's of thousands would be around 0.1% of the world fleet, practically too small to measure. So who cares?

"So who cares?"

The car owner.
The car maker.
The car maker's employees.

"The whole fleet" .. will be much smaller than today, "It is a mathmatical certainty.." as the Titanic builder said.. so making up a percentage of it won't be ~quite~ as tough..

Other people will be walking,
others on Bikes (Lots of them, I'd say)
others on Mass Transit

and of course, a great mass of people will be retired. We'll probably even hear the BOOM! of those Boomers then.

When gas goes north of $8/gal, and/or gas shortages start, a whole lotta people will care. Good that the groundwork is being laid now, cause tswhtf pretty soon.

Hundreds of thousands of hybrid cars were added to the mix in the last decade, what difference did that make? (Except for the few lucky owners.)

To "solve" the transportation problem in the USA it needs to be 200 million such cars. If only 100's of thousands, or even a few million, are thrown into the otherwise business-as-usual mix while oil declines for a decade past peak, the economy will still collapse, and most of us won't be able to afford any sort of car. (Except perhaps an old SUV to be used as stationary shelter.)

For a real "solution" we have to abandon (gradually) the personal automobile concept, and spend the money on mass transit. And appropriate housing.

Most 2008 car models have an alternative hybrid configuration. I wouldn't be surprised if the demographics change VERY quickly due to this fact...

Cars are no solution - we need to cut our consumptions by two thirds to exist based on our own oil supplies - an average of 75 MPG. We need an 80% cut to match the rest of the world's per capita usage - an average of 125 MPG. You're right on there.

I don't think this is going to be a gradual thing. Gradual would have been leadership immediately after 9/11 and a drive for transit oriented development. Now its going to be forced on us and there will be plenty of "if only we had ..." conversations going forward.

We didn't. That is the end of that.

Um, that's about 5 trillion dollars (assuming a $25k hybrid and no inflation) for American consumers to take out of their rapidly depreciating Mac ATM's.

BTW the percentage of ownership expense for fuel rises as the 'value' of the guzzler drops. ('Hey Honey another slightly used SUV for sale!')

I believe that there are enough fuel tanks in the world currently to account for all the 'affordable' export crude capacity the world has to offer. Was it 10 million new units in China this year?

Someone pointed out the 'expanding user base' value is opposite for cell phones vs. automobiles.

Let the non-negotiable lifestyle negotiations begin.

You know, the happier you get, it just gets them madder.. you ... Morning Person!

I do think there are going to be more electric cars out there in the coming years, and I don't object to many of these posts as much as some here do, particularly since we've had working battery-electric vehicles for over a century, and they are enormously simpler and cleaner than an ICE vehicle.. as much as some of these new models are apparently trying to correct that oversight.. (AND- I really love my Subaru! I asked the Subaru guy last week if he knew whether there was anybody converting the Legacy wagons to electric. He didn't know, and was very polite in hearing out the question.. I had also just been asking about keeping an OBD2 Diagnostic Scanner hooked into the computer to get up-to-the-minute MPG info, which he thought would be ok, but didn't think it was worth the investment.)

Still, I do have to wonder if you are aware of how the Tone of your posts can be so grating to many posters here? It seems like you just want to make sure all the news isn't negative.. and it's not.. but it comes across as one of those 'So there!' statements, with the easily inserted translation of 'it's unnecessary to be concerned about energy, because these projects will fix it!' .. whether that's your belief or not.

I just think that, while I don't court the doomer vote either, the precautionary principle suggests that we acknowledge the challenge that we're facing, and that any number of our proposed solutions still hardly come close to meeting the gap that has to be filled.

I don't think it's useful to run around screaming in fear/anger, thinking that you can predict failure any more than you can predict 'Victory'.. and we do have to be looking at what tools we can find that can be shown to work, and at research that is making progress.. but this game/war, whatever it is.. there's no guarantee how it will play out, and overconfidence towards either outcome I have to see as a form of willful blindness. Neither puts us in our best game.

'I refuse to say I believe in something, because then I stop thinking about it.' - attrib. to Einstein.

'I' m not drowning myself,
I' m just freaking out!!' Gedde Watanabe in Gung Ho!

Bob Fiske

It comes off as far less of a "So There!" post than does almost any of Darwinian's or WT's posts. The difference is in the readership and what they expect and want from posts here - antidoomer is simply not espousing popular ideas (at least not popular on TOD).

For all the hot air that's been spent talking up hybrids and electric vehicles, the actual results so far are pretty unimpressive. In my opinion that's the reality of the situation as it stands.

Yeah, but by 'Actual Results'.. do you mean # of wheels on the road? or actual cleanness, efficiency, durability or effectiveness of the vehicle itself?

PV works really well. One of the biggest arguments against it is that not much has been installed. Well look at the competition it's been up against. Cheap, Abundant (up to.. now?) Liquid fuels with businesses and governments getting fat and protecting these sources of Motive and Political power for all they're worth. Does that mean PV is the loser technically, or just that it had an uphill battle against an impossibly entrenched incumbent?

The 'reality of the situation' was created in an imbalanced (and now toppling) environment. These contributors have to be looked at for their intrinsic, not their relative values.


"I had also just been asking about keeping an OBD2 Diagnostic Scanner hooked into the computer to get up-to-the-minute MPG info, which he thought would be ok, but didn't think it was worth the investment."

Have you heard about Scangauge? http://www.scangauge.com/

A lot of "fuel mileage conscious" people (www.metrompg.com, www.crxmpg.com, www.gassavers.org) use them to track their MPG and try to improve it. Also can be used to clear trouble codes.

cool. thanks for the links!

Yeah, I've enjoyed the 'efficiency game' when I've driven a Hybrid, trying to keep the consumption down. The Subaru guy said there was an older Subaru that had such a gauge come with the car..

Good Times! "Boy, dat old LaSalle ran great!.."


"topped up to 80% in only 15 minutes"

I think they meant 15 seconds: 10 seconds to plug it in when you get home at night and 5 seconds to unplug before you leave in the morning.

For the record, the 15 minute charger is not a home charger.

IF people read the damn article, there would be no need for these dumb arguments.

The Second War of Northern Aggression

Details were also revealed in the Washington Post of Dec. 30, 2005, in an article amusingly entitled "Raiding the Icebox." It revealed a 94-page document called "Joint Army and Navy Basic War Plan—Red," with the word SECRET stamped on the cover.

The document calls for a Naval force to capture the port of Halifax, blockade Vancouver and secure the Great Lakes, while a land invasion starts by seizing the Canadian power plants near Niagara Falls. Army columns are then to advance on three fronts—marching up the shores of Lake Champlain to take Montreal, and across the Great Plains to take the railroad center at Winnipeg and the strategic nickel mines of Ontario

I think that we have tolerated this alien culture to the North of USA for FAR too long ! All documents are published in FRENCH and English, they call Indians "First Nations" and actually negotiate with them ! A N D they are about to raise taxes on US Oil companies ! Add to this the rapid increases in importing our sarconol during the last 7 years, their coddling of terrorists (he!!, they do not even waterboard them !) and their refusal to expand tar sands production fast enough, and I think that we have a causa belli with them funny sounding Canucks 1

BTW, As Southerners know, the First War of Northern (or Yankee) Aggression was from 1861 to 1865. The plans for the second one will need a little updating, since the last update (see above) was over 70 years ago.

Best Hopes for the Cheney-Satan ticket in '08,

Alan imbibing some Fine sarconol

I admit to only scanning the article, but it seemed to overlook one very significant incident in US-Canadian relations. In the 1920s, two Canadian army officers travelled by car through the northern US scouting out possible invasion routes. They later prepared a plan under which Canada would occupy IIRC Seattle and Buffalo as a deterrent to any US move against Canada.

So watch out! Take one step toward Alberta and you can say goodbye to Starbucks and chicken wings!

Best hopes for amicable continental relations,

Laurie of the North

The Pentagon has plans for everything. Their bookshelves are full of RAND Corporation reports with titles like Short and Long Term Contingencies Consequent on an Israeli Blockade of the Faroe Islands. They probably even have a plan for invading and occupying Iraq. How's that whole thing working out, anyway?

Sorry but Michael Moore already fought the Canadian vs US conflict in the spoof 'Canadian Bacon.' Worth a watch for some laughs...imo.

Be careful there or we'll be forced to burn down your Whitehouse again.


Have at it!

Thank godz for the Glenn Berrys of the world.

The folly, egoism and dangers of climate geo-engineering

Is humanity so resistant to change that we will tamper with the biosphere’s workings to construct a “Frankensphere” rather than reducing population, consumption and emissions?

... Two rogue US companies are moving forward with plans to fertilize the ocean with iron to create plankton blooms to suck heat-trapping carbon dioxide out of the atmosphere. They are motivated by profits from the growing carbon credit market, rising public demands for action, and politicians eager to avoid painful reductions in emissions. There is little that can be done to stop them, as no applicable laws or treaties exist. ...


(the article is dated Oct 22, 2007, my apologies if this was posted earlier)

How can they be sure that the plankton won't sink, decay, and burp methane in the atmosphere? Talk about the law of unintended consequences!

But they got their FRN's and can now buy the food and guards to stay alive while you die.

So, its all good. At least from where they are.

That is exactly our biggest fear - the unintended consequences that happen after the (ignorant and greedy) fools rush in where the wise feared to tread.

All I can say is that I hope the moderate, rational voices within the galactic climate change community can keep the wacko-reactionists and the greedy corporate parasites under control.

I wonder if any of the other world's military powers might not see efforts in geo-engineering as threats to their national security. What if any of these efforts appear to pose a threat to their nation's annual rainfall, solar irradiance, etc - will countries down-stream of these "experiments" sit back and just hope for the best?

Or might other nations view such efforts as possible threats to their security or even acts of war?

This may have been covered before, but not to my satisfaction.

A recent article by the Washington Post
opines that traders could be responsible for the run-up in crude prices. I am at a loss to explain how that is possible. I understand how it can occur with stocks and such, and I could even explain how it could happen with farther out future contracts like 2012 or even 2015. Now if these traders cornered the market and actually took the supply off the market, I could see the fundamentals changing, but that's not what the traders are doing. Trading crude futures is a zero sum game, most contracts are sold before expiration. Can anybody think of a way traders could influence the spot price via simply trading futures?


The press doesn't do its homework. Studies have already disproved the notion: http://www.theoildrum.com/node/3183/258355

These are gold links, thank you.

The smart money is getting out of anything even remotely connected to US issued paper because a big portion of it is pure fraud. It isn't so much the trading as the capital flight.

The money has to go somewhere, and it is huge. The speculative money is going to China, but most the value preservation sector is going into commodities, and that means oil and gold. Governments can not print those and the only way to beat the global elitist fascists™ is to get out of anything that can be printed or made up.

Preferably holdings would be in a country not controlled by them.

It just occurred to me while typing that this could be why despite the obvious risks China is now considered the lesser risk.


Maybe it's because those inferior yellow people have had the good sense to stockpile an enormous amount of yellow metal as a backstop.

I would wager that yellow people have a lower percentage of inferior people then other people, but I don't have the socio economic data handy.

In any event, hard to go wrong with gold if held long enough.

This individual should be banned permanently for racist comments (y**w people) - Maybe he should be prosecuted.

Alternately please remove all posts with y**w people and also this one.

IMO allowing such posts to remain will not be helpful to this board's mission.

I'm pretty sure he meant it sarcastically.

Though I really wish people would avoid that kind of humor. It doesn't translate well.

Well, I'm kind of yellow, yellow-brown actually. Example: I lay my arm down on this desk, which is a sort of light brown yellowish color, and it kinda disappears. It's pretty odd looking. Of course I roll up my sleeve and that it's just the darker part of a "farmer's tan" is obvious lol

Leanan, I think that cultures that have survived for many centuries, for instance the Chinese, Indian, Persian, Jewish, etc, have had the experience of being ruled by many governments, over thousands of years, and these different governments issued fiat currencies when they were in financial straights...Therefore, the people of these ancient cultures have learned that gold and other commodities are a store of value when fiat currencies are not. We all know that values of fiat currencies are manipulated by governments for various reasons. The older cultures know it far better than the younger ones. I believe that this is what Musashi meant to say...If I am wrong I apoligize.

I meant Super390, not Musashi.

Musashi you are right on the money (pun intended.) The quantity of credit market borrowing is staggering. Below is a link to the Monday column by Doug Noland and an excerpted paragraph or so. Literally tons of money chasing a shrinking quantity of goods...but not dollars.


...snip...'Admittedly, the Fed has opportunely administered several bouts of "reflation." We have, however, reached the point where another round will be self-defeating. To throw out some numbers, from the Fed's Z.1 "flow of funds" report we know that Total Credit Market Borrowings (non-financial and financial) expanded at a $3.75 TN annualized rate during the first half. To put the immense scope of recent Credit inflation into perspective, Credit Market Borrowings expanded on average $1.233 TN annually during the nineties.'...snip...

'The legacy of years of runaway U.S. Credit excess includes many trillions of dollar liquidity balances circulating around the globe. Chinese reserves, for example, have inflated almost seven-fold in just five years. On the back of unprecedented global Credit and liquidity excess, energy, food, precious metals and other commodities now attract intense demand and virtually unlimited purchasing power. Our economy – our financially stretched consumers and vulnerable businesses - will now have no option other than to bid against highly liquefied competitors for a lengthening list of resources. Failure to recognize that this situation is a major inflationary problem is disregarding reality. The same can be said for suggesting that we can continue on this current course - with massive Current Account Deficits and rampant speculative financial outflows to the world fueling myriad dangerous Bubbles and maladjustment on an unprecedented global scale.

Today's backdrop is unique. There are literally trillions of dollars of liquidity slushing around the world keen to hold "things" of value. Liquidity sources include the massive central bank reserve holdings as well as funds at the disposal of the sovereign wealth funds. Importantly, the more apparent becomes U.S. financial fragility, the keener they are to stockpile real "things". There is as well a global leveraged speculating community, in control of trillions of liquid purchasing power. The speculators are also keen to acquire (non-dollar) "things" as opposed to our securities. Indeed, it should be noted that this is the Federal Reserve's first attempt at reflation where U.S. securities are not the speculators' or foreign central banks' asset class of choice.

Not only is the pool of potential global buying power unparalleled in scope. It is fervidly attracted to tangible assets - as opposed to U.S. securities - and is highly speculative in character. At the same time, an unwieldy global boom is stoking unprecedented demand in China, India, Asia generally, and the other "emerging" markets including Russia and Brazil. Throw in various weather related issues and energy production constraints and the prospect for some very serious bottlenecks and shortages has developed.'...snip...

Too many pieces moving simultaneously. Once the marginal pieces get wiped out it becomes clearer. There is a economic aspect to it, but there is also a warfare aspect to it, and it is 4GW in it's most developed form.

Have you seen this?

At the heart of this phenomenon, Fourth Generation war, is not a military but a political, social and moral
revolution: a crisis of legitimacy of the state. All over the world, citizens of states are transferring their primary
allegiance away from the state to other things: to tribes, ethnic groups, religions, gangs, ideologies and so on. Many
people who will no longer fight for their state will fight for their new primary loyalty.

People think that 4GW isn't here in the US yet. They are wrong. The fur for the most part hasn't started flying yet, but the ideological 4GW is in full swing and there are many factions. In a way yet to be realized we are as hollow as Iraq because the faction in control of government has introduced too many extraneous factions. It doesn't matter if they are introduced physically or politically if they are put on the board. This is how they stay in power.

Musashi, yes I have been keeping abreast of events in 4gw by reading Lind, Global Gorillas, etc.

4gw also includes economic warfare...not mentioned in the quote above but very important. Imo China is very good at economic warfare and is using it skillfully against the US.

'A crisis of legitimacy of the state.' Well, if a state no longer places the needs and wishes of its people first and foremost, then the state fails to pass the test of legitimacy. Would you agree?

Once the oil is gone for most of the people most of the time there will be many breakdowns across our society. Eventually the continuing breakdowns will lead to primary loyalties, ie; families or maybe small communities after they are purged of dead weight. The situation will be very tough for very many people...But some will be smart enough and lucky(?) enough to live through the changes and their children might even thrive in a world that is very different from that we know...But the 'new reality' will seem normal for people a few generations from now. There will be far fewer people. In a couple of hundred years fables about America might spring up and be treated as we treat those stories we hear of Atlantis. If shrub and vader thought that there was a magic bullet to replace oil they would not be fighting so hard for the remainder of the worlds oil.

If you have Power Point you can see a sketch of how and why everything constantly changes in real time.


CNN showing some huevos:

Subprime bailouts: Chump check - Responsible loan payers are crying foul about the breaks that delinquent borrowers are getting.

Still, Scott Keegan, executive director for National Association of Mortgage Professionals, fears that public money will be spent bailing out people and there'll be taxpayer backlash.

"The majority of people I talk to are upset already," he said. "They say, 'I make my payments on time. Why do these people get bailed out?'"

He understands Countrywide's newfound flexibility. "It's self-preservation," he said, and predicts the credit crisis will worsen over the next few years. The leap in foreclosures "is not even close to what's going to happen in the next 12 months."

With some of the refinancing slack being picked up by FHA and the government sponsored enterprises like Freddie Mac, Keegan does not think the funding of these organizations will last without significant infusions of public money.

Some people will get a sweet deal, one that, in the eyes of other borrowers, they may not deserve.

As for Teresa Nelson, she understands the rationale behind bailouts but still disagrees with them.

She said, "The American taxpayer has been paying through the nose for corporate handouts for too many decades now." She does not think we should help cover the losses brought on by business decisions of big bankers or greedy consumers that thought they'd get rich in property speculation.

"Our nation is closer to a recession, and it may be just what we need to get people to tighten their belts and live within their means," she said.

Sure she/they are right, but they have not realized the bigger factor yet.

It doesn't matter what the group is, once a high enough percentage of sub prime people is brought into any group the whole group collapses. Doing the right thing doesn't shield anyone, the only things that do are not to allow the sub prime in or to get out a little ahead of time.

The smaller the equity, the smaller the % of sub prime people required to bring the house down.

It's not much of a bailout anyway - my understanding is it would pay 2-3 months' mortgage at most, which means they're still going down.

Chump check ???

Ask Alan Greenspan who the chumps are. He was the mastermind behind this disaster and the scum bag is still treated like some sort of godz.

It's so sad to see the complete breakdown of professional investigative journalism and it's replacement by the National Enquirer staff. But then again, that is what We The People wanted, and we got it good and hard (to paraphrase HL Mencken).

By the time the dust clears Greenspan and Bush will be in their South American hide-aways, safely surrounded by Blackwater and company.

It is more and more difficult to find informations about energy related news in France and Europe (not as difficult as finding information about Mexico's oil production though).

I already posted about the shortages of heating oil and the rumors of spot shortages of diesel fuel in Bretagne. Leannan posted some articles about the striking fishermen in Bretagne (France). These fishermen are now blocking three oil depots and one refinery. Perhaps this can help to rebuild the tight stocks of distillates at refineries but could mean an imminent situation of shortages for customers (we, the people) because of the already low inventories at retailers.

The french trade-unions for transporters, FNTR are already in the starting blocks for actions in France which could mean a blocking of the main oil depots in France with shortages for everybody.

These actions come about in a period of big social unrest in France. This situation is heavily downplayed thanks to president Sarkozy's political skill which however won't help him any more in the coming days if all the projected strikes do occur.

Perhaps we can overcome this period in 2007, but if Stuart Stanifords warnings for 2008 come about, we could witness some disorganisation in France spreading fast to the rest of Europe next year. Far from having protected us, the nuclear policy has helped to delude ourselves, believing that our energy supply would be infinite and postponing all investments for conservation.

At ASPO-USA, I was talking to a French hedge fund manager, and I expressed my opinion that a US move on Iran was to World War Three as Poland was to World War Two--triggering organized resistance to the aggressor in both cases.

He disagreed. He said a more likely scenario is that the US and Western Europe would work together to direct oil flows from the Persian Gulf to Western Europe and the US, and away from China.

Version 3:

The locals would rather have no one have the oil if it is going to be such a problem and they act accordingly.

What was your reaction to this ?

Did he really think that Russia and China were just going to sit there and letting this happen ? I think he underestimates a bit the strenght especially of China.

Iran is a really high stake. China has acquired a lot of diplomatic and political skills, not at the UN but on the field.

I have talked in Corsica to a person who works for France, and who has first-hand knowledge about the oil and military markets. He doesn't know what will happen but he doesn't rule out at all the possibility of WW III. He is astonished by the speed at which China is currently influencing policy in Africa and Asia towards its interrests. He also told me that there are far more people interested in an ongoing war in Darfur than people trying to settle it, precisely because of the former. The West is definitely loosing steam (his words) and Sarkozy's diplomacy isn't helping us a lot on this one (my interpretation - not his words). We are desperate but still very influent and strong, and a strike on Iran would be a sign of this (our desperation and our strength). Besides his opinion is that the oil business will be over in 2020, he sees unprecedented hardship in the coming years and a civilisation without any resemblance to the present in 2050.

Not everyone is in the same mood as this hedge fund manager. Was he from Société générale asset-management ?

In regard to my reaction, I frankly thought that his scenario was scarier than mine. He is co-manager of a US based fund. Interestingly enough, there were a lot of financial types at ASPO-USA.

China is working very hard on their navy, but their big weakness, so far, is the lack of a large blue water navy. Having said that, tankers make big, fat inviting targets for any kind of submarine. If oil were redirected away from China, it might not be much of a stretch to see China at least threatening to torpedo tankers along the coasts of Europe and the US.

Interesting times.

Interesting times indeed.

I see what you mean. For the present, I think China's strategy is scary enough, selling arms as crazy to anybody offering some crude, along with new subtle anti-western rhethoric. Seeds for a nasty period to come.

It won't come to that as they have a mightier weapon - the $US which they could wield in a number of different ways!.


China seems more interested in creating submarines since they are convinced that 'a large blue water navy' is the same thing as 'ducks on the pond.' Recently a Chinese sub surfaced, undetected, in the middle of our Pacific Fleet.

The following is from 'China Daily' and indicates that China is going to upgrade their strategic missles ASAP.

One fact that seems to elude most Americans and other Westerners is that China is a very old and patient culture/country. China knows very well that as each day passes the US and EU are growing weaker economically, due in no small part to PO. Consequently, it is in Chinas long term interests to wait for the economic collapse that is inevetible for the west. Meanwhile China can depend on Russia and other sources to supply them with enough FF to stave off a popular rebellion of the type that is so common to countries in the throes of spiraling inflation. Also, Chinas leadership is vetted based on intelligence and the leaders are not subject to changes in course every few years by election cycles. The unusual combination of communisim/capitalisim/and totalitarian regime seems to be working out well for China...so far...

Hu urges missile troops to improve capability


...snip..."The SAF, under the People's Liberation Army that consists of 2.3 million members at present, was founded in 1966 to upgrade the army's overall combat strength.

The force has formed its own unique series of weaponry and equipment, comprising both nuclear and conventional missiles of various types and ranges.

It boasts a great number of missile specialists who have been considered "talents" or "special personnel" of the PLA, which accords with the army's long-standing policy of adopting "high-tech means" to strengthen the capability.

The white paper on China's national defense in 2006 says "high-tech means" have been widely adopted to "reform military training" and accelerating the process of "new weaponry becoming combat-ready ones"...snip...

You all are dreaming if you think anyone can stand up to the current US military. We might suck house to house fighter, but we can certainly take on military.

Case in point, Syria put Russian anti-missile jamming equipment around their nuke stuff and US back Isreal took the stuff right out. In fact, both Syria and Iran were publicly barking at Russia about the failure.

China would get it's ass kicked and quickly. A sub does them no good without oil, and for better or worse, "their" oil is currently surrounded by heavily armed US soldiers.

As for the dollar argument, well, China doesn't actually have a trillion dollars. What they have is a trillion dollar IOU from the Treasury. The serial numbers of which could become "misplaced" during any attack.

I realize that our CIC is an idiot, but the Pentagon can still buy some pretty lethal stuff for 600 billion a year.

In fact, both Syria and Iran were publicly barking at Russia about the failure.

I have never seen any official statement by either government about this. It would be rather strange for Syria to complain, as only Iran bough anything close to semi-modern air defenses.

Air defense needs to be layered and have a good reach to be effective. Iran does not have this (and Syria does not have 10% of Iran's air defense capabilities). Iran will not be able to defend against air strikes effectively (by this I mean destroying at least 50% of incoming planes), but:
1. Air strikes are useless by itself.
2. Although useless, they are rather annoying for a receiving side if that side can't retaliate. Unfortunately for the US, it has several hundred thousands of troops sitting in bases just west of Iran, so Iran can retaliate if it forced to. Iran can stop oil flow around it borders relatively easily as well. And many other ways to retaliate.

After a year or so of bloody fighting US society will not stand up to a higher Iraq death toll and a huge death toll in Iran as well. From what I've read Iran also has huge influence in Pakistan, so situation there might change very, very fast.

A sub does them no good without oil, and for better or worse, "their" oil is currently surrounded by heavily armed US soldiers.

- I think China buys more and more oil from Russia and Kazakhstan. In any case US financial system (and more importantly 600 billion for Pentagon that you mentioned) depends completely on China willingness to finance this. China might not be the most powerful country yet, but in 5 years it can easily be. If they figure how to kick start higher internal consumption in addition to being a lead exporter to the rest of the world, there will be no stopping of China.

Governments stand on three legs...not one. No government in history has remained a world power with just a military. Without economic strength and good relations with our allies (meaning a functioning state department that is as equally powerfull as the military), the US is through as a world power. In other words, it takes brains as well as brawn. Brains are not evident anywhere in the current administration.

China is patient and does not feel compelled to force a military showdown with the US. Time, PO, and a fading US economy is on their side. China has a vibrant and growing economy. Perhaps you should brush up on world history?

As far as what was bombed or not bombed in Syria? Perhaps you could provide a link? In any case you are still touting military strength...There is a great deal more to being a world power than $600bn/yr in military expenditure...Well, Iraq is a good example of using it in the wrong place for the wrong reasons at the wrong time.

I think people sometimes forget the strength of the US economy. Yes there could be hard(er) times ahead but the US economy is still 3x larger than its nearest rival (Japan) and is around 6x larger than China. IIRC most economists have been predicting economic parity between the US and China by around 2030. I'd say sooner, perhaps quite a bit sooner, but China faces many of its own problems: environmental issues, and the possibility of severe internal political disruption, a new mass democracy movement etc, to name two.

There is a tendency on this board to talk down the US. Despite what might lie ahead there is always something to be said for sheer momentum. The US is still the world economic gorilla. A bit punch drunk but not quite ready to lie down on the matt for the count just yet.


re "China seems more interedted in creating submarines since they are convinced that 'a large blue water navy' is the same thing as ducks in a pond."

At least one US Navy commander agrees, saying "There are two kinds of ships in the Navy - submarines and targets."


Errol in Miami

I predict that capitalism's catastrophic blunder in concentrating high-tech manufacturing in Asia will bear fruit in a Chinese equivalent of the weapons that helped former industrial powerhouses the USA and USSR win World War II: not the most advanced, not the best-built, but built in such vast numbers that the US Navy, in particular, won't be able to counter them.

Think of a smart torpedo. It is released by the thousands into the Pacific current to carry it to the West Coast. It uses passive sonar, and has enough processing power to discriminate between carriers, oil tankers, and other kinds of ships. When it finds a target, it ignites an undersea rocket engine now used in both Russian and Iranian torpedoes. Its explosively-formed projectile warhead will go through the skin of any ship afloat.

And if worst comes to worst, it can carry a nuke right into San Francisco Bay, Long Beach Harbor, San Diego Harbor.

No carriers, no submarines, no aircraft, no highly-trained sailors. Just a Roomba with fins.

Pardon me, but I still can't understand why the US and W. Europe would be weakened by PO while China wouldn't. It seems to be a common view here on TOD. And China's military might shouldn't be overestimated. Send a nuke to SF Bay or sink a couple of aircraft carriers and within 30 minutes you'll get hundreds of Tridents and Minuteman raining down on your head. The west, and especially the US, will not go down without hitting back. China will be screwed like all the others.

How would this be a loss for Russia or China? Oil is a fungible asset. If Persian oil is redirected to Europe, that reduces demand for Russian oil which could then be sold to China. Granted I'm ignoring the obvious financial investments in Iran that Russia and China have made, but still, if you believe the Russian rhetoric 'plan for being a major supplier to Europe' then there is still plenty of oil there that will be available in the future :P

Our middle case is that Russian net oil exports show an initial decline rate of -8.2%/year plus or minus 4%, hitting zero net exports in 2024 in a time frame from about 2020 to 2029.


Saudi Arabia, Russia, Norway and Iran are likely to be the 'last men standing' in 'Export Land'.

As of now, peak 'Net Exports' was in 2005.

In 'Export Land' at peak there were 41 'Net Exporters', of these 34 have peaked or are at peak and just 7 are yet-to-peak.

What concerns me from a European point of view (where 25 of the 27 states import nearly all their oil) is that all ‘Net Exporters’ will eventually peak and inevitably, as their production and ‘Net Exports’ decline, they will one by one become ‘net importers’ until there are no more ‘net exports’ available to purchase by anybody.

So, won't this process accelerate an already rapid decline in oil available for import (at any price!).

Or don't I understand what's going on here?


Regarding the "last exporters," I would think that a more likely scenario would be Canada, the Caspian Sea area, Africa and depending on their consumption versus nonconventional production rate, perhaps Venezuela. And then there is the Iraq question.

Our middle case is that the top five as a group hit zero net exports in 2031. At their 2005 rate of export, our middle case is that they would deplete their remaining cumulative net export capacity in 13 years, in 2018 (which is why their net exports are declining).

As I have suggested before, IMO the very lifeblood of the world industrial economy--net oil export capacity--is draining away in front of our very eyes, and 99% of the population does not have a clue, while Yergin/Lynch, et al basically urge us to "Party On Dude!"

Oil is really not quite as fungible as some think. There are several factors that affect its fungibility or the lack of it. What is more, natural gas is most certainly not fungible (well, LNG could be in theory), and a lot of Europe is dependent on Russian NG running merrily through the pipelines without interruptions.

Geopolitical considerations may also be much more significant than economists et al. might think. If they stick together, China, Russia and Iran will have lots of clout.

GrandOldPartyguy , you really dont "get" peak oil do you ?

I agree with him - it looks to me like Europe is completely on board with US policy. Maybe not in rhetoric, but where it counts they're right there.

Yes of course.

But the antagonism created by an attack on Iran would be US+Western World against China+Russia and allies. This could still contain the seeds for a world war, whatever form this could take.

Which is why Germany is working so hard on renewable energy sources, because there is nothing the Germans would be more thrilled about than getting into WWIII? The same applies to a few other European countries, Sweden comes to mind, possibly the Spanish and Italians, and notice that the Poles just kicked out their anti-EU and pro-U.S. twins.

Of course the industrial West will do whatever it takes to keep comfortable - it just might be that some people's idea of 'whatever it takes' actually includes something than bombs.

Hmm - and the Germans will have enough energy from renewable sources? And they are not participating in NATO actions right now? Yes, they are pursuing renewable sources - I never said they were not smart. But they're also pursuing dominance over the remaining oil resources along with the rest of Europe and the US - because renewable will not be enough.

Gee, it actually sounds like he completely agreed with you ...

He said a more likely scenario is that the US and Western Europe would work together to direct oil flows from the Persian Gulf to Western Europe and the US, and away from China.

[emphasis mine] ... but was too stupid to realize it.

To be fair, I guess that we were technically discussing whether the entire world would be aligned against the US, or whether the US and Western Europe would be allies in the Oil War(s).

Things aren't going so well for the allies though:

Taliban capture third western Afghan district

Pakistan heading towards failed state status and Iran giving the West the finger. Not to mention Iraq, et al.

The obvious route is for Europe to lean more towards Russia and away from the US.

No one has ever conquered Afghanistan. It is a black hole into which men, machines, and money fall until political will or finances fail the foreign power, then they withdraw. The United States wants things to fit into that standard adventure movie time window of two and a half hours, but the Afghans see things differently. If they don't kick us out their sons will, and if not them their grandsons will have to do the job, but it will get done eventually.

The Brits are scared silly of this outcome and I think with what we see in Pakistan we now know why they were so worried. And it begins on Iran's border as well ... lovely.

It's certainly tough in Afghanistan. Watch the latest BBC Panorama programme to see just how difficult it is (it's a really good view of what's happening on the ground):

Taking on the Taleban -The Soldiers' Story

Panorama followed a unit of British soldiers on a six-month tour to the front line in Afghanistan. It ended with one soldier dead and 12 seriously wounded

Historically speaking, no invading force has done very well in either Afghanistan.

Thanks for that. Reuters now has an English version, so people won't have to be subjected to my lame attempts to translate...

Striking French fishermen block oil depots

Striking fishermen blocked the entrances to three oil depots and a refinery in northwestern France on Monday to protest over the rising cost of fuel.

Around 300 fishermen barred access to a depot in the Atlantic port of Brest shortly before dawn and other protesters sealed off depots serving the ports of Lorient and Douarnenez.

Another group of fishermen set up a blockade at one of France's biggest refineries, at Donges, which is operated by oil giant Total. The company said there was no immediate impact from the protest.

This is scary... it sounds like a replay of the protests that started the same way in 2000:

It started with a few angry French fishermen who found it harder and harder to make a living with the price of gas increasing, and blamed government taxation...

When the demonstrations spread to the UK, protesters blockaded fuel refineries and distribution depots. Within days, the protests created a fuel crisis that brought the United Kingdom to a halt, and nearly destroyed large sections of its economy.


Sarkozy used to be an israeli intelligence asset, some believe he still is.


Sarkozy's popularity has fallen like a stone in France since his election. It's uncanny how these guys can so successfully win elections and yet are so dire at actually governing. Winning elections, is of course, the easy part.

Whilst a few European governments may support an agressive US stance on the "Iranian Question" when it comes to the man in the street, things are very different. I think any European government that supported an attack on Iran would be committing electoral suicide.

The only major country that might back the US is Great Britain, but even that is doubtful. One might get the backing of Parliament, but the population as a whole wouldn't stand for it.

So this time the US would really be out on its own, with only Israel for company, that's pretty isolated in anyone's book!

The ghastly and really frigtening thing, is that we could be on the edge of World War III. It sounds so dramatic, almost hysterical, yet, Bush mentioned it himself recently. Does this reflect current thinking in the Whitehouse, or is he just "talking"? The point is, a US President should just "talk" about World War III! It's way too serious a subject to be talked about lightly.

Maybe... maybe things are actually worse than they seem. Why wait until China gets stronger, why wait until Russia gets even stronger? Instead force the issue now while the US is still incredibly strong militarily. Regime change in Iran, establishing a pro-Western government and gaining access and control over Iran's oil and gas, would be a substantial strategic setback for both Russia and China. This is because both countries want Iran as an ally against US interests. This really interesting question is, how big a setback? How important is Iran in relation to Russia and China's longterm strategic planning? Can they afford to let Iran fall into the US sphere? Can they accept the US setting the entire Middle East ablaze? Will Russia or China come to Iran's aide?

In US public has influence on elections, so it hard to force this issue while ignoring costs. And costs of attacking Iran might be just high enough where internal politics would force US to withdraw not only from Iran but from Middle East at large. Iran is ;ager and much stronger then Iraq was. It has much better weapons and is more willing to fight, but more importantly I think it learned a lot from Iraq war.

In US public has influence on elections...

Evidence for this, please?

"It is up to the most conscious member of the relationship to create the space for the relationship to grow." Ram Dass

There isn't going to be another regime change in Iran as in 1953; the vast majority of Iranians would never succumb, just as the vast majority of Iraqis aren't. WRT oil, Iraq would likely be exporting 3Mbbl/d if not invaded in 2003, perhaps more, and in Euros. Yet, Iraq still exports somewhere between a third and half of that, on good days. So, perhaps as many as a billion bbls haven't been exported from Iraq that might have. How much less would oil be priced if all those bbls had hit the market? US behavior has also led to lesser amounts of oil being exported from Iran and Venezuela, which has also hindered supply; so, where would price be without these overall lesser export flows?

A note about WW3. The US military is quite weak in all its land-based components. Russia could possibly succeed at pulling off the massive combined arms invasion of Western Europe that was feared for decades during the Cold War, not that Russia wants to become an occupier again as it's learned there are better ways. And both Europeans and Russians have learned the hard lesson that it's cheaper to do business than go to war. Europe will finally be subsummed within Asia, with the continent becoming called properly Asia. (Depicting Europe as something geologically separate from Asia has always been a great indicator of Euroexceptionalism/Eurocentricness.) And geopolitics advances as the natural aspects of geographical areas win out as the primary mover of Interest; such might be called, Moving Beyond MacKinder.

Europe is not part of asia, it actually is a completely different tectonic plate then what is called asia. That way they call it that.

Sarkozy is starting to look like Musharraf without a uniform.


Has anybody noticed the PetroChina initial public offering. Up triple in the first hours, which would mean a market capital dwarfing Exxon/Mobil, some say already at 1 trillion for PetroChina....(!!!)

Does PetroChina have oil and gas reserves to support that kind of market capitalization, and if they did, how many barrels/trillion feet of nat gas would we be talking about?

And if so, one would assume that folks buying these shares think they have room to grow....meaning even more reserves from somewhere....

Folks, there is a lot of bullsheit being passed around in the world, watch you damm billfolds!! :-O

Any of our analytical bean counter types care to give us an explanation of the 1 trillion dollar Chinese oil industry....:-)


As the article I posted up top explains, the reason the PetroChina IPO went that way is that Chinese have a lot of money, but they are not allowed to invest it outside the country. So whenever a Chinese company has an IPO, there's a tsunami of investment.

Hello Leanan,

Yep, that is correct, but once ASPO/China informs the investors what is really going on--expect the stock to plummet to a more reasonable valuation. Recall that Warren Buffet just sold his huge stake in PetroChina for incredible profit.

On second thought: maybe ASPO/China members will be thrown in jail for trying to speak truth to power. Who knows?

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

City Oriente, Ecuador and Oil

I wrote this in my diary at the Agonist today.

My perspective of what has happened in the growing conflict between Ecuador's Correa and foreign oil interests.

I did inhale.

I don't like to take the wind out of that article but much of sounds quoted from 'Conmfessions of an econmic hitman':



I read that book, hence the use of the words, economic hit men.

How would that take the wind out of the article if what I said is accurate?

I did inhale.

In case you interpreted that I was saying that it was plagerised (which I am not).

Did you not find the book very vague?

The author was VERY reluctant to give the details of specific deals, I thought.


I do think the guy is "out there" to a degree and probably in some sort of a delusion as to his own importance, but some of what he says jives with what I saw growing up in Ecuador.

Others have written on the situation with the world banks as well, (John Pilger, for one). Most are from the left and I don't necessarily like their solutions, but they do point out effectively that the agreements that left Ecuador saddled with such a massive external debt were not unlike other forms of usury similar to those rent-to-own shops, compound mortgages and credit card companies employ on unwitting Americans.

I did inhale.

Hello TODers,

Mexico stocks drop sharply on US credit worries
Strange how this article made no mention of the flooding problems down south that has basically made a large area of Mexico a welfare state needing massive infusions of money for some time, so that it can eventually get back on its feet [if it ever does].

Recall that all crops were wiped out, and who knows how many cars, trucks, farm-tractors, and other heavy equipment have mud inside their motors. Roads and bridges gone, maybe sewers filled with dirt, or washed away, therefore inoperative. How many electrical motors and appliances are full of sludge? During the blackout periods: how many miles of copper will thieves take, not only overhead, but also by quickly cutting the wiring harnesses out of disabled vehicles, and soggy electrical motors? Can gas-stations be submerged for some time-period, then quickly restored to full operation, or has the 'tabasco sauce' infiltrated the underground tanks through venting pipes, and also made the metering pumps full of goop?

Thus, maybe some of the Mexican stock-market selloff can be attributed to the Mexican topdogs partially cashing out to move their money to a safer location: in anticipation of a big Mex. tax hike as Pemex depletes, and massive wealth-redistribution to help prevent an economic Mex. Civil War.

I wonder what the current, going Tabasco price is for a wheelbarrow, or a sturdy bicycle with mounted baskets? A wheelbarrow could be very useful for moving sludge out of the house, or hauling two five gallon water jugs. The bicycle could be handy if the only open grocery store or govt. food bank is 10 miles away over largely non-existent roads.

My feeble dos pesos.

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

Good catch. It seems that on the secret talking points/censorship list that the Bush administration distributes to Fox/Warner/NBC Universal, newsmen are specifically instructed to ignore stories about natural disasters in the key oil export countries, like the floods in Oman and Mexico. Armed disruptions, like Nigeria and the Mexican pipeline bombings, still get through the filter. Perhaps the public is meant to see "above-ground factors" as being the kind that can be solved by future American troop deployments?

I did a Google search on "Tabasco flooding oil", found this link:

BBC NEWS | Americas | Mexico flooding affects '700000'... and severe flooding in the state of Tabasco in Mexico, authorities say. ... almost all exports and halting a fifth of the country's oil production. ...
news.bbc.co.uk/2/hi/americas/7072554.stm - 45k - Cached

Note the reference to oil production.

But when you go to the actual page - that part has been edited away. Surely it must have been there initially when Google indexed the page?



This version still has the quote about exports and production.

"It is up to the most conscious member of the relationship to create the space for the relationship to grow." Ram Dass

Bob, it sounds like you'd love one of those Dutch bicycles that have a wheelbarrow like box in front. Go to raincitybikes.com for a look. Check out the other workbikes too. Only a matter of time before the forklift bike.

check out: http://www.fietsfabriek.nl/ for some nice examples of these bikes

Farming problems from attepting to do so in a desert as California faces AG income hit: http://news.yahoo.com/s/ap/20071105/ap_on_re_us/farm_scene_california_water

Item provides observation that any grocery shortage would be filled by imports.

"My water manager calls it an impending Armageddon, and I would probably agree with that," said Bob Polito, who grows avocados in Valley Center in San Diego County.

They went from annuals to perennials and now they're stuck - can't not water your orchard for a year like you can an empty field.

The EIA International Petroleum Monthly report is out with the data for August. World oil production for August 2007 was 72,512,000 barrels per day, down 706,000 barrels per day from last month and down 1,786,000 barrels per day from the peak in May of 2005. The average for the eight months of 2007 is down 714,000 barrels per day from the average of 2005.


I will probably post more on the August data tomorrow after I have digested the data.

Ron Patterson


You have to get with the program. I have reworked your post, as follows:

The EIA International Petroleum Monthly report is out with the data for August.

World reserve oil production capacity for August 2007 has been increased by 1,786,000 barrels per day, relative to May, 2005.

Regarding the OPEC article up top:

OPEC pumped an average 31.16 million barrels a day last month, up 495,000 barrels from September, according to the survey of oil companies, producers and analysts.

Interesting the way they wrote the article.

From the most recent EIA data for the OPEC 12:

2006 Average Production: 32.1 mbpd

2007 Average to Date: 31.3 mbpd
(Through August)

August: 31.5 mbpd

If the estimate in the article is correct, I gather that production apparently fell in September, rebounding in October to a level below the year to date through August and below August.

If this reading is right they cut production by 500k/d in sep, which would explain tighter storage and higher price. But, why, exactly? Was there a production problem, was price too low, or did they save part of Sep production to enable them to pump more in Nov?

Or, maybe the figures are messed up.

according to the survey of oil companies, producers and analysts.

Anyone wanna take a guess at the methodology?

I mean, it sounds like they ask a bunch of folk 'how much oil did angola pump this month' and take the average?!?!

Jaymax (cornucomer-doomopian)

That is basically how these things are done (I suppose). If you don't trust the figures that angola releases them self than you can only get a better guess by interviewing the ones that ship the oil out or that buy the oil etc.

The EIA has caught us off guard this month, already releasing the International Petroleum Monthly report (the way it used to).

Shows July/Aug down 640K from July/Aug last year in total liquids.

Don't worry- according to the experts oil will be cheaper (in nominal dollars) in 2030 than it is today. In real dollars oil will be virtually free in 2030. http://www.eia.doe.gov/oiaf/ieo/oil.html

Shows July/Aug down 640K from July/Aug last year in total liquids.

But July to August this year shows a much larger drop:

July 2007 All Liquids .. 84,887,000
Aug 2007 All Liquids ... 83,920,000
Difference ........... 967,000


Ron Patterson

I just received this post from Mike Lynch, thought you might be interested. Actually the post was to a list but in direct reply to a question I asked him on that list. The question was about a speech he is going to give in Houston about the coming oil bust. His term not mine. ;-)

Hi, Ron (and others), this will probably be last comment for a while, I can’t keep up. (And I have a book to work on.)

Yes, Ron, I’m speaking in Houston to the API on the bust and its effects. You are welcome to attend J We’ll see if there’s any press. I don’t know how much of my talk I will release (i.e., the slides, yes, the write up, maybe not).

You say OPEC is in decline, but production has been rising lately, from Libya , Algeria , Iran , countries that would be considered less resource-rich than the Saudis. It’s up about 500 tb/d since January (ignoring the Angola effect.) That was before the November 1st 500 tb/d increase scheduled; not sure how much of that will come about because the market is still relatively saturated. Backwardation has reduced the incentive for US refiners to buy oil, although the high trans-Atlantic arb could offset that.

Projections for next year are: 0.5 mb/d of OPEC NGLs, 0.1-0.5 mb/d of non-OPEC liquids, 0.4 of FSU crude, plus an increase of about 1-1.5 mb/d in OPEC capacity. (From IEA, OPEC, EIA, etc.) Even if you assume that this is optimistic, it implies that supply will grow a good bit, assuming the market is there.


Ron Patterson

"Backwardation has reduced the incentive for US refiners to buy oil,"

This is true, and this plus high price could explain why US stocks are falling vs 05/06; however, reduced demand in the US has been more than compensated by eager buyers elsewhere, driving price to present record level. What, therefore, might he mean by "assuming market is there'? The market certainly wants more than it can get right now.

As noted a few comments above, opec is not producing more, it is producing less, and cutbacks at uae will more than absorb higher announced opec output this month. Something always seems to get in the way of higher world output.

Regarding next year, I doubt we will see even 500k/d more from opec than this year, russia looks within 100k of peak, north sea/mexico and all the other usual suspects will be down, only angola/fsu doing their best to stem 4Mb/d world decline. The 2010 peakers are still expecting new oil that is so far awol. IMO we will be lucky if decline holds under 1%/y.

OTOH, we may well be in a deep recession by mid year, with market bottoming in 2010, just in time for the decline to accelerate. Perhaps this is what Mike is counting on.


Yes, very interesting...and again is a story that is running close to some questions I am trying to resolve....the closing line,
"Even if you assume that this is optimistic, it implies that supply will grow a good bit, assuming the market is there."

The big producers seem to be getting more and more nervous about that, don't they? In the meantime, investment money pours into other places, note the rise of the THAI (Toe to Heel Air Injection) pioneers in the tar sands....

Does somebody know something? I saw a stat the other day that said hybrid vehicle sales were now 2% of new car market, and growing exponentially...
And OPEC suddenly seems to be playing nice, saying that $100 per barrel creates "demand issues"....doh! :-) I still think we are on the right path....let's take it to $130 and find out!

But all these are not my question....my question is this: What would the implications be of a sudden drop, relatively fast, back to a $45 to 50 per barrel oil price?

But, that would be great wouldn't it? Wellll....for the drivers and power boaters, yeah....But how many hedge funds, pension funds, mutual funds, corporate and individual investors have married themselves lock, stock and barrel to an oil price of "INFINITY AND BEYOND!!! :-O

If you think this piddle shiit whipped up mortgage crisis wrecked some hedge funds and investors, imagine a sudden oil price drop of large magnitude....will it happen? Who knows, but let me put it this way....I would give it at least as high of odds as the odds of immediate (5 years or less) peak oil. That don't mean peak won't happen, or hasn't already happened....but one move fast and hard seems about as likely as the other, up or down.

How many people are prepared for that little possibility, eh? Oh yeah, I am signing this one with my full name, because I want credit for it! Damm, this is getting fun! :-)

Roger Conner Jr.
"The deadliest phrase in investing? 'This time, it's different.'

Roger, why don't you worry about what would happen if a meteorite struck your house. In other words, worry about something that has a chance of really happening instead of worrying what would happen if the price of oil fell back to the $45 to $50 range.

Ron Patterson

You may be right, but you dont know to be so sure. See my comment below

"In other words, worry about something that has a chance of really happening instead of worrying what would happen if the price of oil fell back to the $45 to $50 range."

Ron, over the last few months of this "hysteria" I have read people recommending things such training the youth of the land to use draft animals because there will be no fuel, that the military of the U.S. would ground to a halt due to lack of fuel, that there could not be enough aluminum, glass and copper available to build solar panels because "peak everything had kicked in, that the Chinese nation would be exported to Russia due to global warming, and Atlanta would be an ocean front community soon....do you really want to talk about "odds" on TOD?

But, I will hedge and take some protection. I have NEVER seen such hysteria as I see now (well, not since the late 1970's anyway), and I talk everyday to people in the investment community who are basically herded everybody into commodities....and with the collapse in real esatate price growth, that money is now pouring in....it really is incredible to watch. I know several people, many of them older and single/widowed women who can match the doomerism of anyone on TOD just on the tales the brokers are telling them....this has the makings of a wild azzed bubble par excellence! :-)

But, we'll see. You really see the odds of a major price decline as equal to "a meteorite striking my house", Ron? That tells me all I need to know about what is happening in the "rational" investment community.

This really is going to be fun, because I have paid virtually all debt with the rest to be gone by first quarter this coming year....you see, I can stand Diesel prices up to $8.00 or $10.00 per gallon at that point, coming out of money I used to give the banks and credit card lenders....but I can bask in the glory if prices go the other way, because I have NOTHING in hedge funds, investments or pools invested in the oil price....heads I win, tails I win....(I am not trying to be a smart azz, I just learned SO MUCH about these whipped up hysterias, the HARD way, back in the last two to three decades....it's kabuki theatre at it's finist....by the way, did you get any of that trillion dollar Chinese oil company? heh, heh, heh.....:-)


$50 is possible with mass die off, a truly nasty toxic collapse of the US Dollar, or the downthread comment about Force Majure.

Stoneleigh thinks the price of oil may drop, but it will be even more unaffordable than it is now, due to collapse of the money supply.

If the world oil supply is so precarious that the Mexican flood news has to be blacked out, then one can also surmise that we are only days or weeks away from the markets seizing up with no offers to sell oil. Instead oil will be traded between partners and not on the open market.

In such a situation, Force Majeure will be declared, and I believe that the outstanding Comex and Nymex contracts will be settled for cash (i.e. no delivery required) and at some strike price nominated by TPTB. If this is indeed $50.00 oil, then a lot of funds and individuals will be devastated, but the central banks, who are short at least $6 trillion in oil contracts will be the winners. (Per the Bank of International Settlements website).

What is so unlikely about this? How else will the story of ever tightening oil supplies end as far as the markets are concerned?

Do any of us really believe that the present oil price backwardation represents reality? I dont. I think it is a manifestation of market intervention, and I think that once the markets stop working, a $50.00 oil "official" price is as likely as any other price. Of course, to actually buy $50.00 oil, you will need to throw in some bushels of wheat and mayby a few F15 fighter jets....


Response to $45/bbl oil? A lot of non conventional oil projects bite the dust: like very deep water wells, expansion of Canada's tar sands, enhanced recovery that uses CO2 and other gas injection, beside projects like pipelines that bring FSU oil to Europe or China.

All this would then pave the way for a return to $100 or $200 bbl oil a few years down the road as conventional world oil production plummets, unless the world is in an economic depression and 30 million people in the the US are walking the streets looking for jobs.

Mark in St Louis, USA

Back from essential non-gas-wasting pheasant hunt 11/2 - 7/07 in west Kansas.

Photos this year, in comparison to 2006 dead birds, focuses on ENERGY in western Kansas.

On return I read

A combination of factors -- including global warming, a ravenous worldwide hunger for energy, rising gasoline and fuel oil prices, and instability in the Middle East -- has sparked investor interest in energy and alternative energy stocks. But these same factors also appear to have fueled a rash of energy-related stock scams.

Perhaps some oil price history?

From the Simmons article in Leanan's Links above:

"Major oil companies have quadrupled their spending over the past five years and, other than acquisitions, basically they're in liquidation."

This is one of the reasons I am invested mostly in smaller energy companies within the borders of North America.

The international giants of the industry are like dinosaurs nearing extinction due to inability to grow reserves, as well as their dependency on the good will of oil-rich states in this period of nationalization of oil resources.

Finally Bloomberg has mentioned Mexico, but nothing about a flood.

Mexican Output
Mexican oil production was reduced last week because of stormy weather. The country is the second-biggest supplier of oil to the U.S.
``Crude stocks should indicate an additional draw due to an expected modest increase in refinery activity as well as some additional weather-related delays in Mexican exports to the U.S.,'' said James Ritterbusch, president of Ritterbusch & Associates, in Galena, Illinois.


Sort of an odd place for this story to appear wouldn't you say?


Indeed. Arab News is, in practice, a Saudi government paper, and the expat community often calls it the "Green Truth". While it has a history of publishing things, such as articles by the same Gwynne Dyer, that are most likely never published in Arabic, the fact that they are now admitting PO, inflated reserves etc. is big news. And this just a few days after al-Husseini's remarks, oh boy!

Jussi and Pigglywiggly

The Arab News story is very interesing. So suddenly the Arab News (which as Jussi points out would publish nothing without the implied approval of the Saudi Government) is on the Peak bandwagon, eh?

The reference to al-Husseini's remarks is well taken, being so much at divergence with any view of peak, and I have quoted in posts of my own the number of Saudi oil execs giving speeches claiming the the major barrier to investment in oil expansion in KSA is the lack of certainty concerning demand

But if al Husseini sounds optimistic, he can't hold a candle to
Nansen Soleri, former head of resevior management of Saudi Aramco, who makes even CERA and Yergin sound like doomers:

Note his casual claims of 7 to 8 trillion barrels CONVENTIONAL, and 17 or 18 trillion including unconventional (!!!)

So what's the real story, 2 to 3 trillion total URR or 7 to 8? Gee, that could make a difference....:-)

And what story do the Aramco big thinkers actually believe....peak now, peak later, peak after we're dead or in the ancient baby boomer's home? They have "experts", former experts, execs great and small from Aramco out there peddling every version of the story....Could one of them thar' Saudi American friendship lobbies ask them to pick a story and stay to it? And how about them Saudi production numbers....which are up, or down, or about flat, depending on from where you start the count and who you listen to....:-)

Folks, watch your wallet, this is the biggest freakin' dog and pony show in history....the only question is who hopes to come out on top from this 101 versions of the truth.....but if you ever played Texas Hold um' you know the rule...."if after ten minutes of looking around the table, you can't spot the sucker, the sucker is probably you."

But man, what a game to watch....I wouldn't trade front row seats at this one for nothing! :-)


There is an oil formation that contains a very fine grained sandstone with an estimated 200-400 billion barrels of oil in place. One estimated that only about 10% of the total oil in place might be recovered. The oil might be described as conventional, yet given current technology, most of it will remain in the ground.

The Chinese indicated that they had pumped the Daqing field for a year without losing reserves. In fact that year they announced a discovery of natural gas below the Daqing surface area that replaced the equivalent of the oil they were pumping out in a twelve month period, yet it is not clear whether or not they had discovered more oil.

In another case technology that was credited with boosting overall oil recovery percentages in one field has not been shown to consistently boost recovery in other oil fields.

One might dream of 7 trillion barrels of conventional oil, but one does not have proved producing reserves in that category.

The heavy oil deposits of the world contain trillions of barrels of oil in place, projects to extract the oil took years to accomplish. Some of the areas have limited pipeline and port capacity. Commitments of technology, capital, government approval, labor, and time are required to get the oil to market. Instead of development happening faster, typically there were delays.

If ANWR Alaskan conventional oil projects were approved tomorrow, it might take a decade to bring them to fruition. Devon discovered a an oil pool ov several hundred million barrels of oil north of the Mackenzie delta in Canada. It might take twenty years to develop it due to its remote location.

...so what you're saying is....URR is anybodies guess, right?