DrumBeat: February 5, 2008

Minnesota State Legislators Meet To Discuss Oil Reserves Drying Up

Today, state legislators listened to the dire warnings of an energy leader at the Minnesota State Capitol.

The world's oil reserves are drying up according to Matthew Simmons, an energy investment banker from Houston who has recently written a book on the subject.

Simmons says oil production has already peaked and soon supply won't be able to keep up with demand.

"The demand models show that oil growth is just going to continue on straight up and the problem is: if we're peaking now, it's the gap between we needed 115 million barrels a day to -whoops - it looks like we only have 60 to use and it will create social chaos," says Simmons.

OPEC oil production increased in January - OPEC Secretary General El-Badri

LONDON (Thomson Financial) - OPEC production has risen in the first month of the year according to the Secretary General of the group, Abdalla El-Badri.

OPEC member production, including Iraq which is not included in official production quotas, has risen to 32.1 mln barrels a day from 32 mln barrels.

El-Badri said if the market remains as it currently is the cartel will roll over production quotas in March, despite calls from consumer nations for more oil in the market to cool prices from historical highs. A potential cut, which OPEC price hawks Iran and Venezuela alluded to at last week's production meeting, has also not been ruled out.

U.S. on sidelines of Iraq oil law debate-envoy

LONDON (Reuters) - The United States is watching from the sidelines as negotiations stall between the federal Iraqi government and the regional leadership in Kurdistan over two laws to govern oil production and revenue sharing.

"This is essentially and at its core a negotiation between Iraqis about Iraq's own future," Ambassador Charles Ries told Reuters on Tuesday.

Nigeria plans 20 bln usd spending on oil sector - oil minister

ABUJA (Thomson Financial) - Nigeria plans to spend about 15 to 20 bln usd annually on oil exploration and production, junior oil minister Odein Ajumogobia said.

The minister said this "aggressive production capacity expansion plan" will put Nigeria in the forefront of investments in the Gulf of Guinea. This region also comprises Angola, Cameroon, Gabon, Congo, Equatorial Guinea and Sao Tome and Principe. In all, it has estimated oil reserves of about 60 bln barrels.

New oil complex opened in Kuwait

(MENAFN - Kuwait News Agency (KUNA)) A new oil complex housing the Kuwait Petroleum Corporation (KPC) and the Ministry of Oil has been officially inaugurated here Tuesday.

The inaugural ceremony was attended by Deputy Prime Minister, Minister of State for Cabinet Affairs and Acting Minister of Oil Faisal Al-Hajji on behalf of His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah. Addressing the ceremony, the minister hailed the new facility as an "architectural masterpiece" that absorbed the largest number of oil workers in the country.

U.S. sees Russia, China, OPEC financial threat

WASHINGTON (Reuters) - Russia, China and OPEC oil-producing countries have a worrisome potential to use their growing financial clout to exert political pressure, the top U.S. spy chief told Congress on Tuesday.

...In listing top threats, McConnell cited "concerns about the financial capabilities of Russia, China and OPEC countries and the potential use of their market access to exert financial leverage to political ends."

Russia was positioning itself to control an energy supply and transportation network spanning from Europe to East Asia, and China's global engagement was driven by a need to access markets and resources, McConnell said.

He voiced concerns about the impact of a weaker U.S. dollar on global oil suppliers, some of whom have asked to be paid in currencies other than dollars, or delinked their currency pegs to the dollar.

"Continued concerns about dollar depreciation could tempt other producers to follow suit," McConnell said.

Driving Dip: Trend or Blip?

What are Americans going to do if the price of gas stays above $3 a gallon — or spirals even higher?

A. Move closer to the office

B. Buy a more fuel-efficient car

C. Switch to a car pool or mass transit

D. None of the above

Transportation analysts, eyeballing the first shreds of evidence that Americans have begun to drive less, are pushing the envelope to divine the potential implications.

Will Alaska rise again?

Alaska’s oil production peaked in 1988 at 2.02 mb/d. By 2007, production had declined to ~0.75 mb/d. There was a slight increase in production from 2000 through 2002 due to the introduction of the Alpine and Northstar fields, as well as satellites of the Prudhoe Bay and Kuparak fields. Those fieldsstarted declining a few years after their introduction and have contributed to Alaska’s overall production decline since 2002.

The future fate of Alaskan oil production lies in the National Petroleum Reserve-Alaska (NPR-A) and the Arctic National Wildlife Refuge (ANWR).

Nigeria scraps Shell's oil bonus scheme

The Nigerian Government has scrapped an oil bonus scheme that rewarded Royal Dutch Shell in a further escalation of the confrontation over the financing of Shell's operations in the Niger Delta.

Shell confirmed today that it had received a letter from the Nigerian Government notifying the oil company that it intended to cancel a memorandum of understanding between them. The MOU, which was signed in 2000, created an incentive regime awarding Shell a premium of $2.50 per barrel of oil discovered. In its place, the Nigerian Government said that Shell would be subject to the "regular Petroleum Profits Tax Act regime".

Unlike the '70s, energy lessons expected to last

The oil shocks of the 1970s produced a flurry of attention to alternative sources of energy, but it faded once prices dropped in the mid-1980s. Now, with oil prices again high and climate change moving up the list of public concerns, interest in alternative energy is once again at fever pitch.

Is history about to repeat itself?

Texas: Warming hits home

By 2100:

• South Texas gets drier, hotter, and more unpredictable where violent weather is concerned.

• Loss of barrier islands and saltwater creep further reduce freshwater resources in the state.

• Stronger storms and longer droughts abound.

• And (the darling of simplicity) “South Texas’ character as a ‘problem climate’ will be exaggerated.”

The Militarization of Energy Security

Oil, which sits in the foreground of the global energy picture, is a finite resource. Much remains to be discovered about the ultimate extent of global petroleum reserves, and about the economics of their exploitation. In the final analysis, however, there is no disputing that the world’s supply of oil must be depleted sooner or later. This fact casts its shadow over strategic calculations in the energy sphere.

Experts disagree about when what has come to be called “peak oil” will arrive. Some hold that it is already behind us — that we have already used up half of mankind’s natural endowment of oil, and are on the downward slope of a curve whose theoretical bottom represents the absolute disappearance of oil as a natural resource. Most experts reject this idea, however, and in recent years estimates of available reserves have pushed the hypothetical peak of oil farther into the future, generally beyond the twenty- to fifty-year horizon that constitutes the practical limit of even the most ambitious strategic planning.

Wind farms: Blowing money on a fantasy

My electricity company has just sent me a handwringing letter, explaining why, despite its best efforts to keep costs down, my bill is set to soar again this year.

The reason - apart from the usual rapacious profits enjoyed by our power suppliers - is a hidden subsidy paid towards the development of wind farms.

Tajikistan: Cold Wave OCHA Situation Report No. 2

1. Abnormally cold weather conditions in Tajikistan, causing heavy snow fall and frozen rivers, have led to damage of water and electrical supply systems and isolation of mountainous villages.

2. Roads between several districts have been blocked by heavy snowfall, negatively impacting local supplies of food and other basic commodities.

3. Complicating the situation is a sharp decline in the water levels in the Nurek reservoir, which powers the hydro-electric Nurek Power Plant.

4. Government has prioritized major urban areas for electricity supply and continues a strict rationing of electricity with limits for industries, non-essential businesses and street lights. In rural areas electricity supply has already been rationed to one or two hours a day.

5. Despite increased inflow rate into the Nurek reservoir, the water level has further lowered to 5.7 meters above the dead-zone. If all factors remain equal, Norak Power Plant's electricity production may fall to its minimum by mid February, resulting in a loss of about 39% of current supply of electricity in the country.

Ottawa advises against all travel to Tajikistan during energy crisis

OTTAWA - The federal government is advising Canadians to avoid all travel to Tajikistan during that country's current energy crisis, which is expected to worsen in the coming weeks.

Pakistan: Electricity problems dull people’s lives, gears WAPDA into action

Recently, Lahori nightlife has had a dreary, dark look as frequent power outages have brought it to a near standstill. Lives – domestic and social – have both been affected considerably since the onset of load shedding.

Where usually streetlights would guide speed racers along main boulevards, cars have to now find their way through dim thoroughfares. Where customers would swarm shopping malls and open markets, the shopping centres, like the rest of the city’s public places, are dark and empty.

Energy crisis could lead to five-day working week

ISLAMABAD: Pakistan may once again resort to a five-day working week because of an increasing energy shortage, an official at the prime minister’s secretariat said Monday.

"Discussions have begun to cut one working day and start a five-day week mainly because of the energy crisis," the official told IANS.

Tanzania seals petroleum deal with Rwanda

Tanzania and neighbouring Rwanda have signed an agreement that will allow the former to route its petroleum imports through the Dar es Salaam seaport. The move would enable landlocked Rwanda to counter the escalating fuel shortage caused by the events in Kenya.

South Africa: Fuel shortage for Cape airport?

The Airports Company of SA (Acsa) says it is monitoring supplies of aircraft fuel available in Cape Town after a power outage last week caused a local refinery's aviation fuel plant to close down.

Gas may help us save electricity, say experts

Liquid Petroleum Gas (LPG) could provide a ready solution to the energy crisis but bureaucracy is hindering progress.

Experts and gas providers say that if South Africa began to import LPG from overseas for household use, the energy crisis could be eased in as little as six months, much less time than is needed to build another power station.

The Future of Transportation - Part I

In 2005, the world entered the “post peak-oil” era, as predicted by many oil experts years before reaching this situation. The price of oil is dominated by two factors, new discoveries of oil fields and global demand for oil, falsely called production. As the R/P ratio (Reserves to Production) slides we begin to witness sharp price hikes in the futures market for oil immediately affecting the price of fuel at the pump. During the last 10 years, the price of oil shot up from US$ 10 a barrel to well above US$ 80 a barrel, with current predictions more certain of the price crossing US$ 100 a barrel than ever coming back to US$ 50. The oil market is tightly intertwined with the car market, as both products complement one another to produce the “complete product” consumers desire - the freedom of personal commute. With this document we try to project the most probable set of changes in the energy markets and the transformational technologies that exist today and how they will come together to address this emerging oil shortage. The paper will also try to illustrate the potential business, national and regional effects of such transformation to the energy and related industries.

If You Think Gas Prices Are High Now…

The problem isn’t that the world doesn’t have enough oil, the problem is whether new reserves can be discovered and brought online fast enough to both replace depleted oil fields and keep up with growing demand. Some analysts argue that the world is rapidly approaching the point where the pace of oil depletion overtakes the growth in new supplies. Some analysts argue that we are there already.

Australia: The dangers of short-termism

The price of oil could head north of US$100 per barrel, yet peak oil is barely on the agenda in this country, despite the first, grudging, official admissions internationally that it may soon become a reality.

Global Climate Change Response Can Spur $7 Trillion in Clean Energy Investment by 2030: CERA Analysis

CAMBRIDGE, Mass. (BUSINESS WIRE) - Increasing public concerns about climate change -- and its potential economic and political security consequences -- are driving public policy and private investment to bring clean energy technologies from the fringes of the global energy industry to the center of activities as quickly as possible, a new analysis by Cambridge Energy Research Associates (CERA) has concluded.

This Time Around, Bush Recommends 40 Percent Cutback In Amtrak Budget

U.S. Rep. Joe Courtney, D-2nd District, issued a statement pledging to help provide funding for Amtrak.

“At a time of an alarming infrastructure deficit, an energy crisis, and a transportation emergency in our nation, President Bush's proposed $525 million cut for Amtrak is unacceptable,” the statement said. “As we did last year, I will work with my colleagues in Congress to provide proper funding for Amtrak and the vital role intercity rail provides for our region.”

Bush Budget Guts Proven Energy Savers, Gives More Handouts to Coal, Oil and Nukes

WASHINGTON (February 4, 2008) -- The Bush administration’s just-released $3.1-trillion budget flies in the face of common sense in solving America’s energy crisis, according to energy and policy experts at the Natural Resources Defense Council (NRDC).

The same pen that slashed investments in energy efficiency and renewables by 28 percent ups the giveaways to outdated dirty energy like nuclear power, conventional coal, and oil.

The Big Picture: Climate Chaos

Thermal Inertia. Get used to that term, as it drives the relationship between climate disruption and human civilization, now and over the next twenty years. Its meaning is simple: even if we were to stop all greenhouse gas emissions immediately, right this very second, we’d still see continued warming and disruption for the next two or three decades.

Worldwide Peak Oil May Already Be Here - Now What?

We have had plenty of warnings about the consequences of an early peak in global oil production, but no one in Washington is listening. A premature topping plateau in global oil production would wipe out most, if not all, economic and policy plans on offer by politicians and "think tanks" in our nation's capital. Such plans assume continued growth in supplies of generally affordable oil, but a surprised world could instead soon be facing rapidly dwindling supplies of increasingly unaffordable oil.

The U.S. is the world's largest consumer of oil (25% of total world consumption) and could also find its sources of petroleum imports drying up. In the face of supply shortages, it is likely that the oil-exporting countries would begin to restrict the volumes previously available for export, to ensure that their own economies and people will be spared immediate shortages. Shrinking exports will adversely impact the global economy. The aftermath of peak oil will have major ripple effects for everyone on the planet, and these will only grow in intensity.

Iraq accuses Iran of stealing oil

The Iraqi Oil Ministry has accused Iran of stealing oil from a shared field under their common border.

Iraq also accuses Tehran of illegally seizing and capping off wells in a second field that Iraq claims lies entirely within its territory.

KPC to modernize strategy to increase oil levels to four million barrels by

(KUNA) -- In response to changes that the future bears, the Kuwait Petroleum Corporation (KPC) intends to modernize its strategy to bring up production levels to four million barrels per day by 2020, KPC CEO Saad al-Shuwaib said on Tuesday.

Iraqi Oil Exports Hit Record 2 Million B/D In Jan - Oil Min

LONDON -(Dow Jones)- Iraq oil production surged to more than 2 million barrels a day in January Iraq's Oil Minister said Tuesday speaking on the sidelines of a Middle East energy event at London's Chatham House.

"(Output) was about 2.4 million barrels a day for January and our exports were just under 2 million barrels a day," said Iraq's Oil Minister Hussein al- Shahristani. "That's a record since the fall of the regime."

Richard Heinberg's Museletter: The Great Coal Rush (and Why It Will Fail)

The world appears poised for a headlong sprint toward greater dependence on coal. This book's purpose is to examine one crucial question that will shape this next great coal rush: How much is left?

Jeremy Leggett: The great fuel folly

Oil firms' output is down, yet profits skyrocket. It all points to the crisis predicted by the peakists.

Time to Get Back into Oil

The difference between the current oil price and the price twenty-four months out has gone from nearly $10 a couple of weeks ago to only $2 now. And the price in 2015 is now almost $3 higher than the price in 2010. That suggests to me that people are starting to believe peak oil will become the sort of problem I’ve been describing. If they really believed it, the price of long dated futures would be much higher. But they are starting to believe it.

Fragile Dollar Hegemony: Iran's Oil Bourse could Topple the Dollar

So, how important is it that oil continue to be denominated in dollars? Would the United States wage war to defend the dollar's status as the world's “reserve currency”?

The answer to this question could come as early as this week, since the long-awaited Iranian Oil Bourse is scheduled to open between February 1-11. According to Iran's Finance Minister Davoud Danesh-Jafari, “All preparations have been made to launch the bourse; it will open during the 10-day Dawn (the ceremonies marking the victory of the 1979 Islamic Revolution in Iran) The bourse is considered a direct threat to the continued global dominance of the dollar because it will require that Iranian “oil, petrochemicals and gas” be traded in “non-dollar currencies”.

Ice Melt Accelerates Around the World

With atmospheric carbon dioxide concentrations at new record highs and global average temperature now some 0.8 degrees Celsius above pre-industrial levels, the frozen regions of the earth are showing us just how rapidly climate change can take effect. Recent years have seen ice melt accelerate and spread to new, previously unaffected regions. In many areas, the pace of melting has surprised even the scientists studying it most closely, providing a strong early indication that the consequences of climate change could come faster and be more severe than previously believed.

Society depends on more for less

To address the climate challenge we need to reduce the carbon content of our energy by at least half.

But at the same time we must learn to generate a unit of GDP for about half the energy which we use at present.

Energy efficiency and carbon content of energy are equally important, but they require different approaches to achieve them.

Shell's Van Der Veer Gets Refreshingly Honest

So Who says Peak Oil is not about to become a reality? It must be true; Shell's biggest cheese, Jeroen van der Veer, effectively says so.

In an e-letter to staff that must surely be splattered right across the Big Oil community by now, and be doing the rounds of NOCs (national oil corporations), Shell's CEO basically says that conventional oil output will peak in seven years - oh, and gas shortages are on the way, too.

That's not really fresh news. But what is significant is that van der Veer has essentially joined the now growing cadre of upstream bosses who are gradually admitting that the clock is ticking and it's five minutes to midnight.

As Oil Majors Chime In, the Reality of Peak Oil Lurches Closer

One by one, the world's oil companies are coming out of the closet. For years operating under the assumption and public assertion that world oil supplies were plentiful and would be for years to come, now many of the world's most powerful and well known oil giants are talking about scarcity or, even, the dreaded peak in world oil supplies.

For the uninitiated, Peak Oil is not the point where oil runs out but where it becomes physically impossible to grow the amount coming out of the ground and onto the world oil market. For all intents and purposes, Peak Oil is the top of the curve beyond which world oil production goes into inexorable decline. With a world economy largely dependent on oil for transportation, chemicals, and a range of synthetic products, even a plateau in world oil supply spells trouble.

So let's see what some influential people in the industry have to say about oil supply.

BP to cut jobs after profits fall

The oil giant BP has said it will cut 5,000 jobs after reporting "very disappointing" profits as refining margins were squeezed and costs rose.

BP said the jobs were about 5% of its total global workforce, but declined to pinpoint where the cuts would be.

Replacement cost profits for the fourth quarter fell to $2.9bn (£1.4bn) from $3.8bn, sending annual profits to $17.29bn - marking a 22% fall on 2006.

South Africa: Power Crisis Fires Up Platinum, Coal Prices

SA's electricity supply crisis is playing itself out on global markets, with the prices of platinum, palladium and coal hit ting record levels yesterday on fears that Eskom's power cuts to mines would disrupt supplies.

Platinum roared to a record high yesterday, with an analyst saying it could breach $2000/oz, while palladium hit a six-year peak. SA produces four-fifths of the world's platinum and is a big palladium suppler. The two metals are used in jewellery and in catalytic converters in vehicles

The soaring cost of artificial fertiliser and a shortage of supplies are the latest problems to hit the farming industry

Problems have been blamed on many factors – the closure of phosphate mines in Russia; growing demand from biofuel farmers and use of former set-aside land; the rising price of oil; even cynical stockpiling by fertiliser companies. Advice from suppliers is to order now because it will be distributed on a first come-first served basis. This comes just as the price of lamb shows signs of recovery.

Industry experts say the shortage will last at least two years, which may make more farmers consider converting to organic production, with the added bonus of a premium – although on reduced quantity.

Nigerian militants claim they killed 3

LAGOS, Nigeria - The militant group behind a wave of attacks on Nigeria's oil industry claimed responsibility Monday for a weekend attack that officials said killed three soldiers.

The attack "dispels the false impression being given by the Nigerian government to investors that peace has been restored after a fraudulent peace deal," the Movement for the Emancipation of the Niger Delta said in a statement e-mailed to journalists.

Natural Gas Project Planned in Australia

The Queensland Gas Company, an Australian producer of natural gas from coal seams, and the BG Group of Britain plan to invest about 8 billion Australian dollars ($7.2 billion) in an export project in northeastern Australia to tap rising demand for the fuel.

Amazon forest still a global warming mystery

A key question remains unanswered: Does the Amazon work as a net carbon “sink,” absorbing carbon dioxide, or is it adding more CO2 to the atmosphere than it is subtracting, because of burning and other deforestation that have claimed an average 8,000 square miles — an area the size of Israel or New Jersey — each year of the past decade?

Mexico to issue permits for biofuel production

MEXICO CITY (Reuters) - Mexico said on Monday it will issue permits to companies for the first time to produce biofuels in a bid to cut emissions from cars and boost incomes for impoverished farmers.

The energy ministry said in a statement that companies will be allowed to produce ethanol and biodiesel, which can be used as additives in gasoline and diesel.

Record Financing For Biofuels, Not Food

BROOKLIN, Canada (IPS) - Biofuels have quickly turned from environmental saviour to just another mega-scale get-rich quick scheme. Countries and regions without their own oil reserves to tap now see their farms, peatlands and forests as potential "oil fields" -- shallow but renewable lakes of green oil.

However, renewable does not mean sustainable, and in most cases the only green part of biofuel is the wealth they generate.

Biofuels make little environmental difference

New research from Australia and the OECD shows the benefits of biofuels in reducing greenhouse gas emissions are insignificant, at only one to four per cent.

A new Federal Parliamentary report shows there's also no economic case for mandating the level of ethanol in fuel.

Lent fast to cut carbon emissions

Two senior bishops are urging people to cut back on carbon for Lent instead of the conventional chocolate or alcohol.

Bush wants to beef up Earth monitoring

WASHINGTON - After years cutting of budgets for tracking global warming, President Bush on Monday proposed more than a $1 billion increase over the next five years for launching more and better Earth-observing satellites.

Activists want polar bear on endangered list before Alaska oil sale

WASHINGTON (AFP) - Animal activists on Monday pressed the US government to add the polar bear to the list of endangered animal species before the sell-off of oil and gas drilling rights in Alaska begins in the coming days.

"An endangered listing can affect the sell-off of the oil drilling rights," Brandon Frazier, a spokesman for global animal welfare group International Fund for Animal Welfare (IFAW) said.

"Tipping point" on horizon for Greenland ice

OSLO (Reuters) - Global warming this century could trigger a runaway thaw of Greenland's ice sheet and other abrupt shifts such as a dieback of the Amazon rainforest, scientists said on Monday.

They urged governments to be more aware of "tipping points" in nature, tiny shifts that can bring big and almost always damaging changes such as a melt of Arctic summer sea ice or a collapse of the Indian monsoon.

Climate set for 'sudden shifts'

The nine tipping elements and the time it will take them to undergo a major transition are:

● Melting of Arctic sea-ice (about 10 years)

● Decay of the Greenland ice sheet (about 300 years)

● Collapse of the West Antarctic ice sheet (about 300 years)

● Collapse of the Atlantic thermohaline circulation (about 100 years)

● Increase in the El Nino Southern Oscillation (about 100 years)

● Collapse of the Indian summer monsoon (about 1 year)

● Greening of the Sahara/Sahel and disruption of the West African monsoon (about 10 years)

● Dieback of the Amazon rainforest (about 50 years)

● Dieback of the Boreal Forest (about 50 years)

The ~900% increase in the price of benchmark crude oils over the past 10 years indicates that the ~50% of oil that is traded (the ‘net exports’) is near peak supply.

Eventually, to counter this ‘peak’ inconvenient truth, each of us will see our own peak consumption of oil. Our solutions to the problem will likely be a combination of increased efficiency (hybrid cars, car pooling), alternatives (electric rail) or conservation (avoid some consumption altogether.)

The consumption of some countries will peak before others, the most vulnerable are those countries importing ~100% of their needs – ‘net exporters’ will likely not experience a consumption peak for maybe tens of years yet.

According to the EIA statistics, at the end of 2006 have any countries already peaked in petroleum CONSUMPTION? … and if so how many % are they down from peak?

North America , 1 country out of 6 post peak
Mexico (net exporter) -3.9%

Central & South America , 4 countries out of 45 past peak
Barbados -19.9%
Colombia -9.1%
Netherlands Antilles -8.5%
Uruguay -21.0%

Europe , 10 countries out of 37 past peak
Belgium -5.8%
Czech Republic -1.9%
France -4.4%
Germany -8.9%
Italy -10.9%
Luxembourg -4.0%
Macedonia -16.1%
Portugal -10.9%

Eurasia , 0 country out of 15 past peak

Middle East , 1 country out of 13 past peak
Israel -15.1%

Africa , 6 countries out of 56 past peak
Botswana -16.7%
Congo (Kinshasa) -57.0%
Cote d'Ivoire -20.1%
Equatorial Guinea -39.9%
Mauritania -18.7%
Zimbabwe -53.0%

Asia & Oceania , 8 countries out of 44 past peak
Afghanistan -60.1%
Hong Kong -7.9%
Indonesia -4.1%
Japan -9.4%
Korea, South -0.9%
New Zealand -1.2%
Pakistan -5.5%
Taiwan -2.1%

Xer: Interesting post. Thanks.


Out the door, first Zulu Social Aid & Pleasure Club (sounds so very right for a post-Peak Oil World doesn't it ) parade, and then the Societé de Sainte Anne



I have been thinking of Nate's recent article and an appeal for a different "way of being" (often contemplated with the aid of biological consumption of ethanol).

Instead of striving for the biggest SUV and largest McMansion, how about striving for the best costume, best party, coolest set of friends, the best food, the best music ?

We try to appeal to all the senses here :-)

Laissez les bon temps roulez !


In the old days there was an underlying reason for Carnival (or Carne Vale - farewell to meat - in the original Latin), followed by the Lenten fast. It was hard to store enough feed and fodder to keep livestock alive all winter, or to store butchered meat for very long. Remember that salt and cold were about the only preservatives, and keeping the rodent population away from the animal feed or preserved meats was very hard to do. Thus, people would pretty much plan on just being down to their breeding stock by early-mid February or so, and to have eaten all of the preserved meat before the weather started getting warmer. The butter and fats would all have to be used up, too, before they started to go rancid. Thus the big bash to eat up the last of the meat and fat (thus Fat Tuesday - Mardi Gras) (which was also why there would be a big pancake fry-up). They would thus have to subsist mostly on bread and beans until the first of the spring greens (those that they got to before the rabbits, anyway) and the spring lambs would become available and the hens started laying (Easter Eggs, anyone?).

We've gotten so far away from the land and the natural rhythm of the seasons that most people have no idea where these traditional customs come from any more.

Thanks - these little bits of knowledge are one of the bright spots of my day! I love it when things make sense.

We've gotten so far away from the land and the natural rhythm of the seasons that most people have no idea where these traditional customs come from any more.

We've gotten so far away from the land and the natural rhythm of the seasons that most people have no idea where FOOD comes from anymore.

The acorn tree syndrome strikes again


Actually, I’m not all that surprised. A friend once confessed to me her own early ignorance of nature. It’s in one of my books. She had decided that it was high time she learned how to grow her own food. She planted lots of potatoes. They grew wonderfully. Then suddenly, inexplicably, as she related the story, the plants died. Not a potato had been produced, she sadly told her friends. Surveying the scene of desolation, she tripped over a bulge in the soil. What’s this? It was a potato as big as a softball. She examined the soil more closely. Why, the ground was full of potatoes!

Dylan: Idiot Winds

Idiot wind, blowing through the buttons of our coats,
Blowing through the letters that we wrote.
Idiot wind, blowing through the dust upon our shelves,
We're idiots, babe.
It's a wonder we can even feed ourselves.

that most people have no idea where FOOD comes from anymore.

On a business trip out west on the taxi's radio the local station was playing the audio from a town meeting were one of the elected officials stated how she did not feel the taking of farmland for development was a non-issue because she could just go to a different grocery store.

Oh and in other news - Nixon Food Dude dead.

In his time heading the Department of Agriculture, Butz revolutionized federal agricultural policy and reengineered many New Deal era farm support programs. His mantra to farmers was "get big or get out," and he urged farmers to plant commodity crops like corn "from fencerow to fencerow." These policy shifts coincided with the rise of major agribusiness corporations, and the declining financial stability of the small family farm.

Hi Eric, I don't think that elected official would have impressed Wendell Berry either. I came across his 'The Unsettling of America' the other day, talk about being ahead of that oft mentioned curve. The book was published in 1977, before, I am guessing, half of those posting here were born (no criticism of youth intended here, I merely used that as a point of reference, if any criticism then just of self for not having come across him sooner). Very interesting what he has to say about Butz's 'revolution' and the destruction of not only agriculture but community. Good stuff.

And that Mardi Gras, Easter are based on the moon phases.

Pagan rituals anyone?

Laissez les bon temps roulez !

Alan, I like your attitude!

Down here in Panama, Mardi Gras (or "Carnaval") is a very big deal indeed and has been going on for several days now, much like in Nawlins.

A good time to forget the world's problems and just let it all hang out. Tomorrow will deal with itself.

Perhaps, as in the Jimmy Buffett song, this really is "The Party at the End of the World". We shall see, but for now "Let the Good Times Roll !!"

HAPPY Mardi Gras Everybody!

Here is our parade site:


Laissez les bon temps roulez !


Check out Mish's comments about Wickes Furniture's bankruptcy--and the fact the mortgage meltdown is hitting home. His wife, who works for Wickes, will probably be laid off in two weeks.

I'm kind of surprised his wife would be working for a furniture store. Doesn't seem like the kind of job someone who was aware of the mortgage crisis would choose.

Well, I'm not personally surprised by this. Few of us have that "dream job" that is environmentally and socially responsible, rewarding, and financially secure, all at the same time. Sometimes, you take a job because it (a) offers health insurance, (b) is close to home, (c) allows you flex time to juggle family responsibilities, (d) pays a little more than the last crappy job that you had, (e) take your pick...

In my next life, I hope to be one of those entrepreneurial souls that calls his own tune, but I know it ain't going to happen in this life.

In this environment, I think I'd pick job security over all those.

Though lately I've been thinking about what I would do if I had to find a new job. Go to Alberta join the black gold rush? Not environmentally responsible, but it sure would be tempting.

Furniture is definitely not on the non-discretionary side of the economy.

People will need to buy a continuous supply of furniture for firewood after tshtf. I bought a wickes couch twenty years ago and I think they were in financial trouble then.

This story does illustrate the quandary of having a current job on the discretionary side of the economy.

Do you start over in another industry, probably at a lower pay scale, or do you try to hang on as long as you can, while perhaps training to do something else?

Training time is over.

Do what you were planning on in the fifth grade.

Right 90% of the time.

"The bonds show Apollo's equity in Realogy ``has no value right now,'' said Sabur Moini, a money manager in Los Angeles at Payden & Ragel, which oversees $50 billion in fixed-income securities. ``If bonds are trading in the 50s or 60s, the market is saying that these guys are headed toward bankruptcy.''-mlimplode

And start watching for potholes. Seems to be a Leading Economic Indicator.



February 4, 2008
It began with a few potholes in the roads, the odd interruption to the water supply in the suburbs, a couple of days with strike action preventing the delivery of municipal services – no garbage collection, protest action disrupting the mining industry and picketing & toy toying at shopping malls…It continued over the next couple of years, largely with disregard for the disruptions, a little irritation to daily commercial and home life by the lack of service provision in food, gas, water and power.

Still, the key question is do you try to hang on (on the discretionary side of the economy) or do you try to find another job on the non-discretionary side, frequently taking a pay cut?

In the example cited (Mish's wife works as an accountant for Wickes), she could have applied for accounting work in something food or energy related.

Training time is over.

Do what you were planning on in the fifth grade.

Right 90% of the time.

So there is still real demand for astronauts then?

An anecdotal story from our oldest daughter. Her best friend from childhood had, untill two days ago, a high dollar job as a rep for one of the large pharma companies. She traveled a lot and earned big bonuses in addition to her high salary and many fringe benefits. Her hubby is a contractor and has had little or no work for over a year. The couple is upside down on a huge McMansion and have one son, age 15. Tough sledding ahead for this family.

I have been hearing a lot of similar stories recently. Depression stories certainly are depressing.

Not affiliated with this in any way but perhaps your daughter's friend might consult You Walk Away.com.

If I understand it the idea is you use your good credit, while you still have some, to purchase a new Bernanke-helicopter low rate fixed mortgage on a new bargain priced property. You fix settlement date for 8 months in the future. Then you just stop paying your current mortgage and let the old lender foreclose.

Result: 8 months mortgage free with all hassles eliminated by a bunch of legalisms filed by youwalkaway.com on your behalf. On settlement day you pay off your credit cards and car loans, mail in your old housekeys and move into your new home. Of course you kiss your credit rating goodbye. But then who needs credit when the banks are burning?

Caveat: despite the recent press this business sounds like some kind of fraud to me. So it's your damned fault if it gets you broke, convicted, and trying to flip from Cell Block C to Cell Block D.

The last I had checked, the credit reports that mortgage lenders rely upon have a limited lifespan - maybe a month or two. If you don't close within that time frame, they need to pull a new credit report. If you start missing mortgage payments, that WILL show up.

That has come here, too - Manwarren Furniture has been a perennial radio advertiser for half a century - family owned, low overhead, and the only game in town for Spencer, Iowa. Their "going out of business" sale was the real deal, with the display floor stripped and store fixtures being sold along with the goods. Across the highway and a bit north the Ready Mix cement plant went the same way, and at the other end of town the Ace Hardware also pulled a disappearing act. I drive down Hill Avenue in Spirit Lake and the spec built mixed shop/residential restored building remains empty and a few of the other shops have joined it. I talked with the book store owner and she says there are four more in the area that are ready to let go after a miserable December and January. This is a city with a population of 5,500 ... and there are five hundred empty houses and condos, and the empty condos are never occupied spec housing.

The funny thing about all this is that between the ethanol plant build in Superior, Iowa, and wind farm construction is southern Minnesota you can't find a rental in this area to save your life - the biggest real estate place in the area has one rental at a less than desirable location with a city sized price tag associated with it.

Oil in a few years at at $12-15 a gallon, according to Maxwell, a senior analyst, with shortages in 2010 after draw-down of stocks and a US recession or slowdown, peak conventional oil in 2012 or 13, peak of all liquids including unconventional resources in 2015, oil $180/barrel in 2015 and $300/barrel in 2020.
Plug-in hybrids and cellulosic biofuel do not help mush until 2025.


Sounds about right to me, although I question how big a part the cellulosic biofuel will play - I don't know how much waste material we have to feed it.

What was most interesting to me though was his timetable - he obviously has detailed knowledge of oil stock availability and depletion rates in oilfields, so his estimate should be taken seriously.

shortages in 2010 after draw-down of stocks

In a free market there is never a shortage, just high prices! - listen to what the OPEC ministers repeatedly say, they tell the truth, the variable price balances supply with demand.

Whenever the global 'all liquids' peak is ... the 'net exports' peak will be even sooner and it's post-peak decline rate will be even steeper - if you live in an importing country that's the most important peak.

Xeroid, I'd like to agree with you here, that "there is never a shortage, just high prices" because I'll most likely always have the resources to buy very expensive fuel. But I'm witnessing around the world the advent of rationing to distribute fuel, especially transportation fuel, to those with the greatest need, not those with the most money. Public services such as health and safety take first priority, commercial users are next, then come us folks that just want to drive down to the beach or grocery store.

Edit: I understand you're talking about the world market, but the end result for us common folks is as I've stated above. The only "free market" will be the black market.

Oh, I agree there isn't a free market.

My opinion is that there will be 'free market' ELM based trading between countries and rationing within 'net importer' countries once peak oil is definitely apparent to TPTB.

This is a sort of ELM with 'knobs on' - and bad knobs, at that, if you aren't in one of the protected parts of society such as agriculture or emergency services or energy!

The real world exporting nations behavior now (from study of the EIA statistics) seems to be just the ELM (without fail!) but will IMO probably eventually migrate to a more rapid 'ELM+rationing+above-ground' rate of decline for most of the population in 'import land'.

Something like this has to happen anyway if we are to meet the UN proposed 20% - 30% reduction in CO2 emissions by 2020.

"Something like this has to happen anyway if we are to meet the UN proposed 20% - 30% reduction in CO2 emissions by 2020."

Umm, was that just added for its comic effect? Well, I got a good laugh out of it anyway, thanks.

sorry ... I should have put /sarcasm

In a free market there is never a shortage, just high prices! - listen to what the OPEC ministers repeatedly say, they tell the truth, the variable price balances supply with demand.

Before Fuel gets anywhere near that price, the gov't will enact price controls. I supppose Fuel supplied from the black market will reach or exceed those prices.

Yup, that's what the gov't will do, play to the populist grandstand. And still the price will be whatever it takes to clear the market. OPEC will say, pay the price or get nothing. When things are tight, then except in the very shortest term, there are just two choices:
(1) High prices
(2) High prices plus massive corruption plus physical shortages
Of course, since option (2) will give The Great Unwashed that warm fuzzy feeling of Sticking It To Somebody, Anybody, they will demand it. Consider, however, that even amidst the alleged solidarity of World War II, so fondly misremembered by today's romantic nostalgia buffs, it was a roaring success mainly as a cesspit of corruption. Then imagine how it might play out amongst a well-armed population when it grinds on and on even while there is nothing, no Nazi Germany, to unite in "solidarity" against. Sigh.

They won't do price controls, they will do rationing. The rules and regs are in place for rationing, it can be rolled out on a moment's notice. They'll do rationing to assure that adequate supplies of fuel are reserved for the military (top priority) and for emergency services, ag, and freight (secondary priorities).

There is no way we'll have rationing on GWB's watch. I doubt that we'll see it prior to 2010. I'll be surprised if we get past 2013 and still don't have rationing.

I don't know what the initial ration will be, but as an exercise, just give some thought to what you will do if you are limited to 10 gallons per car per month. Then think about what you will do with half of that.

Since my goal in 2008 is 60 gallons of diesel (and >3,000 kWh), a 5 gallon/month ration (with my existing full tank and 5 gallons in storage, since I would fill up before) would suit me just fine :-)

Odd rationing issue. Hurricane evacuation, just 42 hours warning (like Katrina). Rationing would be waived to get people out (of Miami, Tamps Bay, New Orleans, Houston, Charleston, etc,.). How many people would stay, with full tanks, rather than evac and end up in ??? with an empty tank ?

I wonder how many are "Drive or Starve" Americans ?


"Odd rationing issue." Yes indeed. Just one of countless ways in which people will expend great effort and/or take great risk to game the system, instead of expending effort to work out ways to adjust.

"Drive or Starve". Well, as I've been saying, that's a tricky one. They're usually commuting because the job far away pays a lot more than the job near home, or is better in some other way. Or because the schools near the job are dangerous or don't bother to educate anyone. Not too many drive in rush-hour traffic for the sheer joy of it. So they'll make a tradeoff when they're entirely out of options.

Oh, and who's to say everyone gets X gallons a month? Maybe long-distance commuters will be rewarded with extra rations. At least for a while, our Congresscritters might prefer that to taking the economic hit from leaving lots of folks so strongly inconvenienced that they feel they must quit and take the inferior job closer to home. That would reduce incomes, in turn reducing the tax receipts that are of supreme importance to Congresscritters, who live and die by dispensing largesse. And even the tiniest reduction will show up in the statistics and will be blared in the headlines.

"...give some thought to what you will do if you are limited to 10 gallons per car per month."

Buy an extra junker car as soon as the political talk looks like it might get serious?

I have been trying to think out some implications of oil at the prices suggested.

It seems to me that rises in oil, although not gas, prices would hit America harder than Europe, and also that demand and hencew prices may be surprisingly sticky.

I think that the figure of $12-15 gallon is arrived at by taking current prices of $3, and when the oil price per barrel goes up to $180 just doubling to $6 gallon, with the figure of $12 coming in in 2020 for oil at $300/barrel.

I am not familiar enough with US figures to know how much of the cost of a gallon is due to refining, or the tax.

In Europe though price signals are going to be pretty confused due to high tax rates.

For example, in the UK cost to the motorist is $8 gallon.
If you assume that all the difference in cost to the US is due to tax, then you have $5 tax on a gallon.

To raise a constant amount of tax revenue you would just need to add that $5 to the $6 actual cost in 2015, plus a bit to allow for the decrease in demand caused by higher prices.
You might come out with $12 a gallon in the UK when it is $6 in the US.

This 50% increase when the oil has increased in cost by 100% means that you would not get as large a reduction in use as you would expect, putting further upward pressure on prices.

This would apply to Japan as well, so you have major areas of the world having larger demand than would be expected for the price.

I don't know if the original analysis allows for that, although it may be partly counteracted by countries which distribute oil at below cost being forced to up their prices.

Yep, you've got it right.

I split the world into three regions:

- subsidised
- low taxed
- high taxed

Those in the subsidised region are OK while it can be maintained, but can suffer instantaneous large rises when things break. If they are net producers then the steady state may continue, but otherwise they transition to ...

Low taxed feel the full force of percentage rises, thus higher real world effects than would be expected. Although the absolute number might be lower, its against a backdrop of no spare funds and profligate usage. This group hurts.

High taxed have had time to get used to high prices. Not only are any oil price rises cushioned, there is the scope for the government to reduce fuel taxation to further smooth and manage the price.

The US hurts because of its low tax status, its wide income disparity, and its societal reliance on oil and transport. Europe has much more scope to manage and survive transitional times.

This is also why I think the oil price will plateau at the point were US lower income families have to stop travelling. There is an extreme amount of demand to be eaten through before other's demand has to drop significantly. If Europe is smart it can use this time period as an additional time period to transition. Totally it up and it could be 10 years worth if played right.

I don't think oil prices will plateau, precisely because of false price signals, arising from the high tax rate on petrol in many areas and because oil is not readily substitutable, or at any rate not before around 2025 when measures like plug-in hybrids and possibly things like algae biofuel can kick in.

Europe, although it won't suffer from high petrol prices to the same degree as America, will be hit far harder by rising gas prices as a lot is used for power generation, and supplies of coal are not so great and costs are higher than in the States.

If they try to use wind-power to supply an even higher proportion of their use, they will go bust, as the numbers do not add up, even before you allow for building a bigger grid and more back-up such as very high rates of penetration would demand:

Solar is worse for many areas of Europe, although Spain and Greece might do OK, together with the southern part of Italy:

Greater conservation and as soon as it can be built nuclear power is the only way we could realistically meet our needs:

Although it should not be assumed I advocate this, I think in reality America will increase it's coal burn, and so economically at least will be less affected by short supplies off natural gas and higher prices.

In many areas they could also install wood-burning heating, and of course the economics in many areas of the States of solar energy would improve, although not against coal, but rapid technical improvement might even make it economic against coal in some areas.

I think petrol costs will mean that house prices in the suburbs in the States will crash, and that the purchase of City houses with a view to splitting them into flats would be a smart investment there.

Oil will plateau precisely because there is no replacement. People will attempt to keep up with rising prices, eventually eating into savings to continue to buy. However eventually they will crash, unable to get to work or to take part in productive society.

When that happens there is a knock on effect, forcing others into crash and bankruptcy. That spreads further and faster than would otherwise be the case. Millions of barrels a day get taken out of demand as the US economy grinds to a halt.

That's what forces a lull in the upward path of oil prices.

Frankly I don't see anything gradual about US situation, things are to optimised around the car and oil based transport, with too little work on alternatives.

While I'm not happy about the position of Europe and gas, it is something I think will not have the dramatic impact that US and oil will have.

I can't see how they will be stopped getting to work.

They wouldn't like it, but they could get to work on some sort of moped, which do huge numbers of miles to the gallon.

Not nice, but a lot better than being without a job whilst they save for their plug-in hybrid or a flat in town.

The way roads are financed there would have to change though, as decreased traffic would dry up tolls.

a) There wouldn't be many jobs to commute to in the kind of deep depression implied by another $50 to $100 increase on top of current oil prices.

b) In some parts of the US, 50-mile each way commutes are almost the norm. Do-able (ish) on a 125cc but never a moped.

..a lot better than being without a job whilst they save for their plug-in hybrid or a flat in town.

Presumably this massive recession with huge destruction of blue and white collar jobs is being art-directed by folk who produce the kind of TV ads we get for, well, plug-in hybrids?

No. It would be horrible and cut swathes of currently working, commuting, car-owning families out of the economy for a long time, and by no means only in the US.

As a result, the oil price would drop back quickly - quite possibly below today's level. That'd help recovery. The nasty aspect of Peak Oil, though, would be that as soon as people started to pull themselves out of the hole and get some kind of recovery going, oil demand would move upwards, smack into declining flow rates again and...WHAM! The cycle repeats.

That would be the kind of wild oscillation in prices described by David Hackett Fischer in "The Great Wave: Price Revolutions and the Rhythm of History."

The good news is that DHF viewed this behaviour as characteristic of the end of a "wave" or upswing in population, consumption and prices, which would be followed by a period of peaceful equilibrium, good conversation and a revival of quilting.

The bad news is that the population gets a forcible downward reset on the cusp of the wave and equilibrium.

In the words of one of Eddie Izzard's best routines: "Cake? Or death?"



Half Empty said:
'b) In some parts of the US, 50-mile each way commutes are almost the norm. Do-able (ish) on a 125cc but never a moped.'

No-one said that there would be none who would miss out, and those with exceptionally long commutes certainly would.

This is far from an average figure though.

That is why GM is designing the Volt to have a 40mile electric range, as that would cover most commutes.

As for the rest of your post, I can't see why some people seem to get pleasure from panicking.

Sure, there are likely tough times coming, and we may screw up and blow it completely, but I don't see any reason to assume so yet, or any point of so doing even if that were the likeliest outcome.

Even if Stuart's hypothesis about huge price reductions in solar cell production are false, as I believe them to be, there is every reason to think that we can provide most of the power in the southern part of the US with solar energy, and that should give things a bit of an economic boost.

That is why GM is designing the Volt to have a 40mile electric range, as that would cover most commutes.

1. No Job, no new electric car. We are headed for a major recession and probably a period of stagflation as prices for energy continue to rise, wages remain stagnate, and unemployment soars. No Cheap energy means a lot fewer jobs. By the time this mess is sorted out, we will be too deep in to oil and natural gas depletion to dig ourselfs out.

2. Mass use of electric cars would bring the US grid to its knees. The US now gets about 25% of its electricity by burning natural gas. It won't be too long before North American Natural Gas reserves are depleted. The price of electricity will soar once natural gas becomes too expensive to burn. Even if Solar or wind was 1:1 (watt per watt) with Natural gas, Its still going to take decades to replace all of the existing watts produced from Natural gas. We don't have decades, five years at best. Solar and Wind are in the range of 1:5 (meaning for every watt replaced by a traditional base load plant (Coal, Natural gas, or Nuclear) it will take at least 5 watts of Wind or solar to match it. (the wind does blow 100% 7/24/365 nor does the sun shine 7/24/365). Oh, there won't be any capital available for massive construction production because of the Credit crunch, and the mass of boomers ready to suck the capital out of the Federal Gov't to pay for all the entitlements promised to them.

Executive Summary: We are totally screwed.

Wow, thank you for succinctly stating that one - I talk to people who're on the wrong side of the ELP line and they always say "I'll just buy a hybrid/electric/whatever". I say "With what job?" and they promptly change the subject.

As you well know, in this context I was quoting the range of the Volt just to give the average distance for daily commute, and to counter your absurdly inflated claims of 100mile round trips by a substantial proportion of the population.

Your point 1. - undoubtedly high oil prices would cause economic pain, but that is a long way from saying that no-one will have any jobs - plenty of people had jobs even in the Great Depression.
Your tendency to wildly exaggerate is being indulged again. Neither you nor I can know for sure how deep a depression would be caused, for the simple reason that it partly depends upon what actions are taken.
If it were to be countered with a vigorous program to conserve energy and bring on line new resources it might be shallow.

2. Mass use of electric cars would not bring the US grid to it's knees. Studies so far indicate that since most of the power would be used off-peak, it would have little effect up to a high level of penetration.
In fact, if your chosen method of power generation were sources like wind and solar, it would greatly improve their economics s it would smooth out fluctuations, one of their major flaws:

The DOE projects wind power costs on a levelised basis of 3.5cents kwh

In the event of a major downturn such as you project costs should sink lower, since there would not be so much demand for the materials.

The price of electric power will also not soar as natural gas supplies run out, Regrettable as it might be from a GW perspective, should rates start moving up too far then more coal burn would be brought unto line.

Presumably since your perspective seems to be exclusively based on the US that meets your requirements as you have plenty of coal.

Not running a car is an inconvenience only for most people in Europe, so high oil prices would hardly be the end of the world there, but as I said areas outside the US seem to largely escape your attention.

Amorphous silicon and solar thermal should be cost competitive with conventional power anyway across much of the US in a few years, and installing that should employ a few people.

And yes, I am well aware that the sun doesn't shine at night or so fiercely in the winter.

For some strange reason you really seem to enjoy making the most extreme predictions, often with very little evidence.

Perhaps a placard? :-)

To my way of thinking, the only way that EVs (whether PHEVs or NEVs or whatever) make any sense as a commuter car is if employers erect PVs in their parking lots to power metered recharging stations. By metering the recharging stations, the employers turn their parking lots into a profit center instead of a cost center - an attractive proposition. Using PV panels (maybe with a net metering tie-in to the grid so that excess solar power isn't wasted and any deficit on cloudy days is covered) should minimize the impact on the grid. Parking lots are ideal sites to erect PV panels.

If we're not going to do this, then I agree that EVs are a waste of time. We might as well all count on just walking.

I take it most posters here have at least a rudimentary understanding of peak oil and what it means for our economy. My question is, how in the world could someone still be fixated on how we are going to be motoring around in our personal automobiles?

Aren't you more worried about how we're going to feed our children when we no longer have a job? How about how we're going to replace our family's shoes once they wear out and they're no longer being shipped in by the boatload from Asia? 7 years down the line, do you really think we are are going to be thinking about manufacturing personal transportation, when the nation is scrambling to resurrect a domestic, local manufacturing base for essential items like clothing, farm tools, and food production?

I don't mean to sound derogative. But it just blows me away how at this stage of the game (2008), when essentially nothing has been done mitigation-wise on the federal level, people could possibly still be worrying about personal cars.

I thought it was pretty clear that I was trying to answer a concern that people would not be able to get to work.

The rest of the post is just your assumptions.

I don't know how bad things will be an neither do you.

I prefer not to panic though, and to try to work out the best strategy, and that includes figuring out whether it will still be possible for most people to get to work, and they will be able to.

I, for one, will believe that GM is actually going to sell a Volt when I see it in the dealer's showrooms. As far as I can see, right now it is still a "concept car". Vaporware.

I will also be surprised if the base model comes in a penny under $25K. More likely it might start well above $30K. Rather than being the salvation of the masses, this is likely to be another affluent person's plaything. Just the thing for someone that can't quite swing the payments on a Tesla.

Yes, but do you have a flag?

Did you hear about Englebert Humperdink? Yes, apparently, he was in some sort of thing and he died. Tragic, really.

"...they could get to work on some sort of moped..."

I infer from this that you are writing from winter-free coastal California or someplace else where an inch or two of snow shuts everything down for days. As I look out the window, I see snow falling on top of a bit of an ice glaze, to the tune of, so the weather folks say, 8 inches (20 cm) by tomorrow morning. These conditions are not suited to the safe operation of mopeds and motorcycles. Long before midnight, they will not be suited even to unsafe operation. Mopeds and such have been pretty much large doorstops from first day of December, and may well remain so until mid-April.

So "they" will drive a car or else "they" will not be holding down a job, nor saving for anything at all. With only a few exceptions, one cannot just take the winter off. Now, "they" might carpool, but that may pose other problems, such as making the logistics of holding down "their" second job essentially impossible. Or "they" might take the bus, except that it's fairly likely that either their home or their workplace(s) receives no service - and if their job is not 9 to 5 the bus route is probably closed down at one end of their workday or the other. Or "they" might move into town, but it's just too bloody expensive, plus "they" may not want their kids in those schools.

On the whole, "they" still have some options left (even though a few don't.) For example, there's an awful lot of vacation travel, plus countless soccer-mom miles for sports and extracurriculars. If and when push comes to shove, all that is expendable and unnecessary. So are a great variety of consumer upgrades. Until those options are exhausted and something breaks, "they" may well hold on, unless a layoff forces the issue. All in all, this thing is going to be rather messy, as none of the propounded "solutions" (including mopeds), short of a rapid supply-side buildout, can really replace what is now.

I said 'they' because I live in the UK, and for most here not using a car would be an inconvenience not a tragedy.

As for safety concerns, weather etc prohibiting the use of mopeds, I was replying to an extreme scenario which had been painted of mass lay-offs and huge poverty - rather than that you would be surprised by what people will risk or the conditions they will endure.

Of course, in practise a whole variety of solutions would be employed. US houses are around twice as big as European ones, and city centre housing could be split into apartments, which those who lived the furthest away would be the first to seek, of course.

One person at my work whose house is some distance away lives in lodgings during the week, returning home at weekends.

No one is saying the adaptions would be easy, just that there are alternatives other than total collapse.

they could get to work on some sort of moped, which do huge numbers of miles to the gallon.

Actually not. About 150 or so mpg# from reports. Very poor thermodynamic efficiency engine coupled with very poor aerodynamics of upright human beings.

Carpooling in a Tata Nano would get roughly comparable #s.

# Mpg will vary with rider. A four and a half stone woman will certainly get significantly better mpg than a 2 meter tall obese man.


Correct me if I am wrong, but I believe 150 mpg is significantly better than the current average of the US car fleet?
Perhaps around 6 times better?
Is it OK to call that 'huge'? :-)

I don't think that is the solution which would actually be adopted in any great numbers, I was just seeking to show that in extremis getting to work would still be possible.

Dorms and weekly commutes for some would IMO be much more likely, or car-sharing, as you say.

RE: Climate set for 'sudden shifts'

Here is another article on the PNAS study.

The lead author, Tim Lenton, also has an research article posted at his web site on the same subject:


E. Swanson

There is no mention of the paper on the PNAS site. Not published yet?

Sorry. It's here

U.S. Service Industries Unexpectedly Contract to Lowest Since October 2001

(Bloomberg) -- U.S. service industries unexpectedly shrank in January at the fastest pace since the last recession as the housing slump deepened and consumer spending cooled.

The Institute for Supply Management's non-manufacturing index, which reflects almost 90 percent of the economy, fell to 41.9, the lowest since October 2001, from 54.4 the prior month, the Tempe, Arizona-based ISM said. A reading of 50 is the dividing line between growth and contraction.

``This is a stunning fall,'' said Michael Moran, chief economist at Daiwa Securities America Inc. in New York. ``If accurate, it's dire news on the economy.''

It's like standing on a pier watching as the supports that hold it up are kicked out one by one. There are so few left it's just amazing that it's still standing. Even more amazing are the people wandering around on top of it completely unaware. Get ready to get wet - it's coming.

Dow down over 200 points.

We are still in "float" territory, Leanan. Please review the Dow over the last several months since its autumn record high. What you will see is a wave structure moving downward. We get a fall, then we get a retracement of 30%-60%, then some brief float inside that bracket, then we restart the cycle with another fall. Each retracement establishes a new lower "high". The last one appeared to be about 13,500 and we fell to 11,900. The 30%-60% retracement took us to just shy of 12,700. We'll be back in "falling" mode again once the Dow crosses back below 12,000 or thereabouts. Each retracement is caused by a belief that we've hit bottom and further falls erupt as that realization is dashed. Eventually, it will be true but not yet. Not when there may be as much as $3 trillion in losses to be absorbed yet (and that's just directly in real estate, nevermind derivatives).

Try: http://finance.google.com/finance?cid=983582

Click on the 6 month view. You will need Adobe Flash player installed and enabled to view the Google dynamic graphs. This is the simplest way to see the repeated wave structure.

Now why does it have this form? Beats me. When do we really hit bottom? Beats me. I'm on the sidelines in everything except my 401K where my options don't let me get out of the line of fire entirely.

Make that 300 points.

I'm not worried. I'm in it for the long haul :-)

Make that 370 points! ~3%

It's like standing on a pier watching as the supports that hold it up are kicked out one by one. There are so few left it's just amazing that it's still standing. Even more amazing are the people wandering around on top of it completely unaware. Get ready to get wet - it's coming.

And at the entrance of the pier stands one Jim Kramer, ranting and raving, soliciting the gullible to "hop on board."

Re: Iraq accuses Iran of stealing oil

a new Iran-Iraq war?

But not a word about Kuwait stealing Iraq's oil.

And the pipeline between Kirkuk and Bayji has just been
blown again.

There can't be an Iraq-Iran War.

It would be an "Occupier of Iraq"-Iran War.

And then, it wouldn't be a war. But a route.

Bush budget launches new Israel aid

Published: 02/04/2008

The Bush administration launched its new $30 billion defense aid to Israel in its proposed 2009 budget.

The $3 trillion budget, released Monday, includes $2.55 billion in defense assistance for Israel. That will increase in increments until 2013, when it will settle at $3.1 billion a year until 2018.

Israel this year received its final $2.4 billion payment in a $24 billion defense assistance package launched in 1998.

The Bush administration increased the amount partly as compensation to Israel for a planned $20 billion in U.S. arms sales to Saudi Arabia and its Arab neighbors.


"It might start with a minor incident, possibly involving an American Marine patrol operating out of the new base at Badrah near the Iranian border. The Marines are surrounded by superior Iranian forces claiming that the Americans have strayed inside Iranian territory. The Marines refuse to surrender their weapons and instead open fire. The Iranians respond. Helicopter gunships are called in to support the Marines, and artillery fire is directed against Iranian military targets close to the border. President Bush calls the incident an act of war and, in an emotional speech to the nation, orders U.S. forces to attack. A hastily called meeting of the UN Security Council results in a 17-1 vote urging the United States to exercise restraint, with only Washington voting "no." In the UN General Assembly, only the U.S., Israel, Micronesia, and Costa Rica support the military action. The U.S. is effectively alone...."


"Recent intercepted diplomatic communications indicate that Israel is frantic enough to “go it alone” in the matter of Iran and is planning to attack that country with atomic weaponry (they do not have the manpower for military ground actions and the United States cannot assist them) in the very near future.

Their recent attempts to starve out Hamas in Palestine by shutting off electricity and food shipments were foiled when furious and desperate Palestinians broke through Egyptian barriers and flooded into that country for food and the necessities of life. The United States government immediately demanded that Egypt reseal their borders at once but as this would have meant taking drastic military action against masses of fellow Muslim civilians, Egypt demurred.

When it was obvious that Murabek (Mubarek) would not obey Washington , (no one obeys Washington anymore) Israel felt that the time had come for it to act unilaterally. One “dragged anchor” severing an underwater cables is entirely possible but the degree and extent of the damage is not any kind of an accident.

The answer to the question as to who was responsible is: Que bono? (‘Who benefits/’) Only Israel benefits and no one else.”-VoftheWH


4 in a row tells me The small Israili sub force {3 boats }has been busy

It's hard to say, that area is rift with subs from US, Russia, China, England, and Iran. It would be hard to pull that off with a submarine and not be detected by the other players.


"The cause of the damage has not been officially confirmed but there have been reports that the breaks were related to a tanker dragging its anchor along the sea bed.
However, the Egyptian communications ministry has denied any ships were in the area at the time of the break."

Why aren't the Egyptians on board with this thing? They have no love for the Persians, and are terrified of their own fundamentalist movement.

The Egyptians are aware of America's dreadful track record of leaving allies in the lurch. If they went to war now, they'd be like the Czar in 1914, trying to start a war to keep the peasants in line. As the war goes bad, the Moslem Brotherhood would be able to recast itself as a peace movement and cross over into broader appeal like Lenin's Bolsheviks. And you know this war would go bad pretty fast.

5th possible cable cut now...


That's one hell of an anchor! Cuts all the way from Alexandria to Malaysia!

There's another possibility: that this kind of failure is very common. Maybe the only reason anyone's paying attention this time was that the first couple of breaks caused such disruption.

In a way, this is scarier than a convert attack. It suggests that it might be very difficult to keep our telecom infrastructure up and running when the cheap energy is gone.

Maybe, but I'm not really buying that. There is a lot going on that we will likely never know about, but you can see things moving around out there in the fog. I think the maneuvering in the New Great Game (TM) is constant, and this smells like part of it.

The whole point of the TCP/IP networking protocols is that they are supposed to be very robust and continue to route data even with a badly damaged network ... it's a military requirement, computer networking was originally designed for the US military ... if it doesn't actually work as advertised best we learn about it now so we don't base our company's just-in-time globalised business strategy on it ... ooops ... too late!

BTW, I wonder if they can cut the satelite links as easily?

In an ideal world where every ISP/backbone provider had equal access to every possible route (only limited by available capacity) then the network could be much more robust. However commercial considerations also limit the ability to just chuck the data down another pipe - ie who do you have backup arrangements with? Unless network routing allows it another physically possible route will just chuck the data away unless the transit networks are allowed to act as a third party forwarder for the end node points.

However it's still true that Internet access is still up in virtually all the affected areas - it's just degraded, so redundant routing is working. Multiple cables are down yet we can still access Iranian websites (although noticeably slower IMHO).

Unless network routing allows it another physically possible route will just chuck the data away unless the transit networks are allowed to act as a third party forwarder for the end node points.

This is a grammatically correct sentence but I can't make head or tail of what you mean by it.

Carriers connect to each other and share routes using Border Gateway Protocol (BGP). The smallest atom in the global IPv4 routing table is a /24 - a block of 256 IP addresses. If you've successfully advertised your prefix through a given upstream provider the whole world can get back to those addresses via that provider, unless there is some filtering happening somewhere.

My multihomed networks are used predominantly by people in the United States and Europe. We have older routers in many places and rather than frightfully expensive upgrades we do things like pitching all of the specific details for the Asia Pacific region - this would be filtering in action. The network I am thinking of in this case can still reach APNIC stuff via a default from one of our upstreams, its just a less than optimal approach and it may result in path asymmetry.

The troubles in the Persian Gulf run deeper than IPv4 routing - that is carrier transport stuff breaking. When you lose an undersea cable there are IP streams for more than one provider in there as well as voice circuits. All of that traditional TDM stuff will end up riding in MPLS (and thusly IP) some day, but we're not there yet ... especially in the hinterlands.

unless there is some filtering happening somewhere.

That's what I meant.

Filtering implies unreachability via a given path. You wouldn't have degradation or a sudden failure, you'd never have access in the first place. This can happen when you "punch a hole" in a larger prefix by offering a /24 that goes a different way than the home AS of the parent prefix.

And this has become a discussion for NANOG, not TOD ...

I don't disagree with you. I was just trying to make the general point that commercial considerations can and do dictate whether a path is available without going into specifics. I wasn't referring to the middle east cable cuts in particular.

But you're right that particular discussion isn't for TOD.

Have you read any description of the physical damage to date ?

Forensics (?), I'd guess I'd call it

unless the transit networks are allowed to act as a third party forwarder for the end node points.
This is a grammatically correct sentence but I can't make head or tail of what you mean by it.

On the top level - peering may or may not be paid for. Aldephlia used to peer with almost anyone at the MAEs and other large cross connects for free. But AT&T wanted to be paid for direct peering. (at one time - eventually Aldphia got big/bought as part of the fraud thing) So, if the way Aldephia got to AT&T was via Time Warner, if TW went 'poof' Aldephia would need to pay AT&T for the honor of getting traffic to AT&T.

Is that more understandable?

TCP/IP does work, but like any other physical medium, each cable that carries this data has a maximum capacity. So things either slow to a crawl, or the connections begin to time out, or experience unacceptable levels of packet loss, as the signals are rerouted around the globe. If you have 4 channels, and 3 are cut, the 4th cannot really handle the load by itself. You can see this for yourself by doing a request to Iran or India now using tracert in windows, or traceroute in Linux/BSD/OS X. First make sure the actual web server is located physically in the area you are wanting to trace the TCP/IP packet path to by checking the location of it's IP address globally.

You can see what this looks like when a local region broadband router or switch (the big ones that handle all the connections, not your consumer one) belonging to the infrastructure of your ISP begins to fail. The signals still go through, but at a snail's pace, until the various parts begin to signal failure due to the long transmit receive times, or the high levels of packet loss.

You can rest assured that if you cut any major data trunk lines between any parts of the world, communications will begin to break down and fail because the remaining lines simply do not have enough capacity to carry the demand, although tcp/ip will still do its very best to handle the failures, but there are limits. This concept shouldn't be that alien to TOD readers.

Actually, it is fairly common, but it's still above statistical average. According to ABC:


There were about 50 repairs done in the Atlantic last year, so say about one per week. However, that's in an area with tons of cables, and redundancy is high, so no one really notices. The ME cables were in areas where much traffic flows through only a few channels (or even just one) so having four or five cut in that region in a little over one week I'd say is, statistically speaking, very significant, if not outright suspicious. Sort of the difference between accidentally shooting the side of a barn and accidentally shooting 5 tin cans at 200 feet.

Malaysia is a country that the US should have treated better when it had the chance (like Turkey). It did everything the US officially claims it wants 3rd world and Moslem countries to do; build its export sector, industrialize, prosper. But it did not do one thing the US unofficially demands: obey the US. US contempt has seemed to stoke militancy and now an increasingly authoritarian rule.

And Malaysia is definitely no friend of Israel.

With Saudi Arabia making moves to support the mildly conservative AKP government in Turkey and Nawaz Sharif in Pakistan, perhaps in defiance of the US, I wonder what the Sauds have in store for Kuala Lumpur, one of the bright lights of Islamic banking? Even if the King's advisors have only taken Geopolitics 101, they should want friends in control of the Bosporous and the Strait of Molucca.

China has the most attack submarines. They can build as many more as they chose to at any time. China is the world's manufacturer.

And in other rumors:

Recent intercepted diplomatic communications indicate that Israel is frantic enough to “go it alone” in the matter of Iran and is planning to attack that country with atomic weaponry (they do not have the manpower for military ground actions and the United States cannot assist them) in the very near future.

Weeeeee! Its a good thing radiation issues are overblown Eh Levink!

eric blair -

Well, I'm glad you said that, because it just further drives home my point that if you want to worry about dying of radiation poisoning, you'd spend your 'worry budget' far more effectively worrying about the radiation from a nuclear war rather than the possibility of some radiation escaping from a nuclear power plant.

Over 100,000 innocent people died as the result of the atomic bombing of Hiroshima. Since that time, some 62 years ago, how many people have died as the result of the operation of nuclear power plants, including the disposition of radioactive waste materials?

It all gets down to a matter of perspective.

Nobody knows, is the answer.

Some estimates from "Eastern Bloc" countries put it at over 100,000 in the last 20-odd years (mainly from Chernobyl)... but since those studies were not in western peer reviewed journals they must be false, right? And other concerns about pollution from mining, milling, storage, etc., and conflicts of interest from the industry are nothing to worry about, either. All kneel and give thanks!

Yep, Greenpeace estimated those kind of figures - and the day Greenpeace make a forecast or a report with anything favourable to say about nuclear power, I will eat it.

Several prominent figures have severed their connection with the organisation because of that.

WHO estimates are centred on about 100 people, as it appears risks from low-level exposure to radiation are lower than we thought, and those are now the figures which are used in risk assessment for medical exposures as well as in the nuclear industry.

I know which estimate I give more credence to.

There was also a steam driven explosion at a reprocessed fuel waste dump in the Urals that had severe local effects and unknown (the Soviets did not bother to measure) longer range effects. Several villages were severely affected, deaths direct (within days) and longer term unknown.


Well, I'm glad you said that, because it just further drives home my point that if you want to worry about dying of radiation poisoning,

If there is a nuke war, and this place exists, and I've somehow survived long enough to post, I'll be sure to ask you how your radiation burns are doing.

Cuz, well, you don't seem to mind the extra mutigens added to an environment filled with http://www.chemicalbodyburden.org/whatisbb.htm

how many people have died as the result of the operation of nuclear power plants,

The Navaho nation has had many deaths, documented in many books/papers. Kosovo, Iraq, Afganistan and other places are seeing effects from the heavy metal Uranium. But I'm betting you don't consider the mining or the post-processing of the fuel as an 'operation externality'.

If you opt to educate yourself, you'd know that. And you'd know the numbers you are seeking.

And if you opted to educate yourself, you'd know that coal plants release FAR more radiation - but taking advantage of an education is not a strong point of many.

I'm still waiting for justification of fission power - given the failure modes of fission power. Thus far, not a single advocate has shown how man can build complex machines that do not fail. In fact, people like LevinK lie about the topic, posting pure bullshit. But hey, perhaps *YOU* can do better and show how the tools of man, built by man and managed by man do not fail.

Israel cannot go it alone. It must at the very least have the tacit support of the US, because it must over fly US controlled airspace in Iraq.

It is as much in the interests of the US as the rest of us in the world that Israel not be permitted "to go it alone". The US must inform Israel that any unauthorized flights over Iraq will be intercepted and if necessary shot down.

Similarly the US should warn Israel that the US will counter strike in the event of a missile attack.

Uh? Dream on. That is what the US, if it was wise, would do. Instead it will no doubt connive, thereby allowing a major regional conflagration, that may even go nuclear. The US could also lose a number of capital ships. Iran will immediate mount an attack on the Gulf based US Navy and regional oil installations if Israel does attack. Things would unravel very quickly.

Jerome stuck a lot of pins in the Iranian oil bourse concept almost two years ago:


I wonder how much of his argument still stands - the United States ceased to be a rational actor in world affairs several years ago and Iran, as a regional power right on top of the supply might be in the position of guarantor now that Russia has explicitly backed them and the Chinese, while being more discrete, could have said the same thing in private.

Iran as a proxy for Russia and China in the Persian Gulf, backing away from confrontation as the United States is already bankrupted by events, and instead taking on the role of the local muscle for a revived Sino-Russian arrangement? This is one potential face of the United States' imperial collapse. Bush will be more than the mere embarrassment he has been thus far when a scenario like this comes to pass, and not even the nuttiest wingnut will be able to deny it.

People always post that link when the topic comes up, but IMO, it doesn't really address the concerns of the petrodollar crowd. Those concerns are made clear in another hoary old link, FinancialSense.com's Island Economics.

The question really comes down to whether it will ever become difficult to convert dollars into other currency. And I think that is simply unknown at this point.

"...will ever become difficult to convert dollars into other currency."

Like the Renminbi/Yuan?

The Dollar loses it's fungibility and the World will crash.

With Asia the first to rise out of the ashes.


"France has warned rebels in Chad that it could intervene if they continue to threaten the capital, N'Djamena.

Foreign Minister Bernard Kouchner said he "hoped" the French troops in the city would not have to intervene.

President Nicolas Sarkozy said France would "do its duty" if it must. The rebels have reportedly accused the French of bombing them already.


I recall Jerome's and other's comments attempting to refute the viability and potential threat to the US of the upcoming Iranian OIl Bourse. For the most part, those comments appear to be valid, but only from a purely economic and financial standpoint. I think what they seem to insufficiently consider is the geopolitical dimension to this whole thing.

I think certain countries hostile to the US will deliberately use the Iranian Oil Bourse as a symbolic extended middle finger in the face of the US, and the Bush regime in particular. Sort of, "We've got our own store now, and you imperialistic Yanks can go to hell!"

As a sort of parable, in Delaware there is a small chain of pizzerias called 'The Grotto.' Well, a few months ago an Italian immigrant, using his life savings, opened up a family-owned pizzeria, which he named 'The Grottino' (little grotto in Italian). The owners of The Grotto chain immediately filed suit, claiming copyright infringement. Evidently, this was a big public relations mistake, because people started feeling that the owners of The Grotto were being a bully by pushing their considerable weight around against the little guy trying to make a go of it. As a result, many customers stopped going to The Grotto, and the Grottino's business is now booming.

Never underestimate the long-lasting power of resentment and spite.

Yes, and also...peak oil. If oil actually is in short supply, then it will be in people's best interest to suck up to oil producers.

Iran clearly hopes this will grow to be more than the Iran Oil Bourse. The original plans were for oil to be sold in e-dinars (an electronic currency backed by gold in a vault in Abu Dhabi). It's supposedly a Muslim currency, so presumably Iran is hoping the rest of OPEC joins in.

The need to import natural gas should ensure that within a few years Europe will not be able to disagree with Russia.

I doubt China has any intention of falling out with any of the oil producers, and may be prepared to fight a war to support Iran or Saudi.

I think China's just entering that sweet spot right now where it can sit aside and watch other great powers bleed each other in wars, then choose to join in late to profit from an easy victory. It worked great for Britain and then the US, until they gave into the temptation to control events permanently via rigid alliances. There's a lot of money to be made exporting wheat, weapons and loans to both sides until you've decided who you want winning.

Since it needs to import vast amounts of critical materials, including increasingly oil, China is in no sort of sweet spot.
That is why they are frantically buying up resources in Africa and elsewhere.

In its golden age of "no permanent alliances", Britain also had to import resources. Everyone did business with Britain because it had money. Attempts by the early United States and Napoleonic France to embargo it went badly. The longer you go before you declare sides, the longer you avoid embargoes and blockades. China will not be fast to officially enter wars. Officially it never entered the Vietnam War, but it appears a lot of young Chinese men died in it. Money is a much sneakier substitute for "volunteers".

China is also frantically buying resources to build up large stockpiles of strategic metals. In wartime those will be traded for oil a lot longer than America can trade bad mortgage bonds for oil.

All China needs to do is print paper. The American solution to the trade deficit is to have China dramatically increase the value of their paper (Yuan). China won't have a problem buying oil-eventually they might start importing oil from the USA.

super390 said:
'In its golden age of "no permanent alliances", Britain also had to import resources.'

Yep, and it was also the golden age of gunboat diplomacy.

They had the world's biggest navy to back up their trade, and never hesitated to use it whenever 'the natives got restless'

The British empire in India for example started as a purely commercial venture, but the British got more and more dragged into government and military conflict to protect their trading interests.

From a commercial point of view, the whole business of governing those territories was an added expense.

When the extra cost of government and military conflict became unsupportable after the WW2, the whole structure unravelled, just as today the cost of obtaining oil from the Middle East is becoming unsupportable due to it's military cost, and the military option had to be exercised to ensure supplies.

China will also, however reluctantly, have to exert military power if that is the only means of keeping needed supplies flowing.


I have the opportunity to give a short presentation on Peak Oil to a very influential crowd. I would like a few basic images (graphs most likely), and I'm not real good at manipulating stuff between formats. I'm not sure what technology I'll have, I'll find out today. Where can I grab: World oil prod., a couple Hubberts' for various countries, world oil discoveries, and maybe Hirsch"s mitigation/time graph ALL IN EASY TO COPY/TRANSFER form?

Thanks, I'll let you all know how it goes.

Fate of Humanity
Download and convert the pps slides to ppt foramt (power point format)

Good luck

go to www.energywatchgroup.org

Under menu->publications->reports they have an oil report with most of the above. That report addresses discoveries, EOR, USGS reserve estimates.

You can use the snapshot tool in Adobe Reader to capture the Hirsch mitigation graph. (good choice).

Thank you for the suggestions. I am using a Macintosh, after a lifetime of PC's. I'm having trouble grabbing an image or a page. I can't find the right commands.

I apologize for using space for such mundane learning, I just want to get a couple good slides/charts to show while I am speaking. So far no luck. If I select a chart I nevertheless end up with the whole document/pdf.

I'm off to find out what technology will be at the presentation site, then I'll come back and go from there. Worst case I can just print a couple selected bits and hold them up/pass them around.

Thanks again.

I just recommended Open Office to someone else here at TOD via email. It is an excellent office suite. The word processor is great and the presentation graphics package is solid. The weakest piece may be the spreadsheet and even it is good. Open Office can also read all Microsoft documents from Microsoft Word to Powerpoint to Excel. Open Office runs on Windows, Linux, Solaris, various other Unix flavors, and MacOS. It's also free although they accept donations.

I am aware of multiple businesses that have phased out Microsoft Office in favor of Open Office instead. It's for real and answers the needs of the vast majority of Office users.

I've been using it for quite some time. I never did get Powerpoint or non-bundled MS Word. Been thru several versions, and like its pdf or doc conversions.

How to capture an image (part of the screen) in OS X:

Hold down the *Command* key (4 leaf clover) then press shift-4 (the $ symbol) - the cursor will then become cross-hairs centered on a circle.

down button drag the cursor across the image you desire to capture. It will be saved as a PNG file, usually on the desktop and given the name
*Picture #*, the # incrementing up as you grab images.

Control, shift, and number 4 activates a little crosshair cursor and one can make screen shots that end up on the desktop - at least on my Mac they do.

Thanks SnB and SCT - that works great.

I'm going to end my talk with a big dose of ELP!

Control shift 3 will capture the entire screen.

Wheat futures up 30 cents thru Dec 08.
May wheat $10.19

The conversion of corn to ethanol made the price of corn triple. Farmers switched wheat acres to corn and then the price of corn dropped and the price of wheat almost tripled. Government plans to enforce ethanol use might lead to another tripling of grain prices. Am not sure if the Federal government has a research department or merely public employees surfing the internet trying to book vacation reservations and other trivial pursuits.

With all the hoopla about cellulosic ethanol and converting forests and peat bogs to biofuels, one cannot find a single cellulosic ethanol plant that is turning a profit. The whole concept is too reliant on having cheap natural gas to distill the unprofitable ethanol. If this cellulosic ethanol were a good deal, you would not need a law to force people to use it. Same thing with grain ethanol. Grain ethanol is not the only compound that safetly oxygenated gasoline. Alkylates were refinery byproducts that were safe and are currently in use as MBTE was denounced.

In Germany the price of gasoline is $7.09 per gallon. Sales of natural gas cars in Germany were growing at double digit rates. As more people are expected to switch to natural gas cars, natural gas prices are expected to rise towards parity with gasoline prices. If the uranium shortage will materialize, then natural gas prices might rise again as they may need it to replace shut reactors.

They won't need to shut down any reactors in the States or the UK anyway die to fuel shortages.

They could just reprocess current 'waste' stocks - there is enough in Britain to power a new reactor program for 60 years, and the States would be similar.

Fears that fuel might run short are usually held, strangely enough, by those who are most opposed to the use of nuclear power.

Fortunately such fears are entirely unfounded.

How would a system of Reactors and their fuel supply fare with an increasingly unstable supply of Diesel? (Or Bunker-fuel, or Gasoline, or Labor?) Even with an ultimately-positive EROEI (and I'm just hypothetically accepting claims made by proponents), the chain of events required to mine, refine and transport and fission that fuel is dependent upon a great many other systems, which it seems to me would put Uranium into the same shakey supply potentials due to 'Above Ground Factors' as Oil.

If the Uranium fuel-cycle is prone to so many layers of possible hiccups, then it's not all that funny that the Opponents are concerned about putting a lot of time, material and money into what could easily become an unsupportable source.

To put a slightly finer point on it, if Peak Oil will really reveal itself initially as becoming a Transportation Bottleneck, then the complicated systems that have been developed in these glory days of Oil-supported Highways, Fuel-stations, abundant Vehicles and all the other fat that has made the First world so magically resilient and unprepared to compromise- will have to be viewed in the light of shortages, interruptions and a more volatile working environment. I don't think nuclear power can survive with any real level of even current safety standards (such as they are) in such a case.

Bob Fiske

Well, it would fare a lot better than some alternatives, for instance wind turbines.

In a future resource constrained world and with the economic breakdown many are hypothesising, the copper in the cables from the turbines would be a very tempting target to the poor, and we are told there will be many millions of them.

They are also indefensible due to their distributed location, unlike compact nuclear plants.

It also takes a lot more material to build windmills, or solar thermal, so their difficulties would be even more pronounced.

Of course, if there were some hiccup in uranium supply, you could always reprocess the 'waste' instead of mining any more uranium at all for many years, around 60 in the case of Britain.

That should give you plenty of time to build thorium reactors, which is 4 times as abundant as uranium.

Or you could mine the waste from coal mines, which contains lots of uranium.

the copper in the cables from the turbines would be a very tempting target to the poor

A fanciful worry I beleive (you appear to be looking for every conceivable way to attack wind).

India has plenty of poor people and 11,000 km of electrified rail lines and building more (two electrified double track all freight lines, East & West).

India also has 7.3 GW of installed wind turbines (with 8 domestic manufacturers). Would that Britain had as much installed today.


All I have time for ATM,

Been a good Mardi Gras,

Best Hopes for a Limited Hangover tomorrow :-)


Of interest on the site is capital costs of 4 to 5 crores (million rupees from memory) per MW. Convert to $ and pounds later...

I was simply responding to a post which seemed to me equally invidious in singling out nuclear power.

Security aside, a breakdown such as hypothesised would make it just as difficult to get the large volume of materials needed for construction of windturbines.

A crore is 10million rupees.

At and exchange rate of $0.025 that is $1 million for 4 crore, just over half the US figure of $1.8 millions MW (DOE) but costs have been rising sharply in the US recently so care would be needed to ensure the Indian figures are up to date.

The site also makes clear that substantial subsidy is required at those prices to be competitative, but other energy prices in India are also highly regulated so comparisons are difficult.

Let me provide you with some wheat and corn data per the USDA.

2007 wheat crop: 60.4 million acres planted, 51.0 million acres harvested, 2.007 billion bu. Harvested, 40.5 bu/acre.

2006 wheat crop: 57.3 million acres planted, 48.8 million acres harvested, 1.812 billion bu. Harvested, 38.7 bu/acre.

2007 corn crop: 93.6 million acres planted, 86.1 million acres harvested, 13.168 billion bu. Harvested, 153 bu/acre.

2006 corn crop: 78.3 million acres planted, 70.7 million acres harvested, 10.534 billion bu. Harvested, 149.1 bu/acre.

Some of the acres planted are not harvested do to flooding, drought, and grazing.
This data is easily accessible here under US & state crops data.


Corn futures are currently above $5 Bu.

China winter wheat trashed by the storm.

Snow cover is usually a good thing for winter wheat. Are you aware of a specific problem with the Chinese wheat crop?

Found this graph in the EIA's
Jan 2008 Short Term Energy Outlook. Yipes!

RBS, one of the ten largest banks in the world, has a $25 billion funding deficit. One can only imagine what Citigroup's deficit is.

I would like to see what the consensus is to declaring Economic Peak Oil as May 2005.

Economic growth depends on growing energy supply or increasing efficiency. Reliable expansion of crude oil supply peaked in May 2005. There may be subsequent peaks, but I believe those peaks will have little meaning to the economy. Stability seems more important than a specific number of barrels per day.

May 2005 crude's steady upward growth broke into a steady downward plateau.

Re-tooling to increase efficiency or market response for Post Peak Oil will likely take 50 years.

I don't believe you can declare peak yet, and may not be able to for some time if we are truly entering an extended recession (or worse). Consider that we have had other extended periods of relatively flat or even falling production.

Using basic EIA global production figures, we hit 55.68 bbl million in 1973, 74 was 55.72, 75 was 52.83. Three straight years of "plateau."

In 1979 production was 62.67. That level of production was not surpassed until 1996 (63.70)

Production in 2000 was 68.37. That amount was not surpassed until 2003 (69.23).

In each case you can argue that there were mitigating economic factors that explain the plateau, and in the case of the long plateau of the 80's their were also significant geopolitical factors.

But this is precisely the reason why you can not definitively claim that 2005 was peak. It may have been, but we won't be able to say for awhile.

One observation about that long plateau that might be instructive, it was initiated by a dramatic spike in oil prices, not unlike what we have experienced in the last few years (and, yes, I'm cognizant that there are differences). Price run ups (as well as recessions) have a way of destroying demand. While we in the developed world have not seen any significant demand destruction as the result of the recent price run up, other parts of the world have. So, while those with the wealth to purchase at the higher prices continue to do so (grumbling all the while) we don't seem to notice that their are 100's of millions, if not billions who have been priced out of the market. In some cases entire nations have simply not purchased oils, or have greatly reduced their purchases.

So we should be cautious when pegging peak, we may be looking more at market forces than at geologic.

But what BJ suggested was declaring "economic peak", and whether we declare it or not it would be pretty easy to make a case for that.

There is no way to separate market forces from geologic forces. And now there is no way to separate out the effect of hoarding as a market force.

People want to separate out market forces from geologic forces because they think that market forces might be easier to change than geologic forces. But it won't be easier to change. We drill in one way rather than another because we are using oil in one way rather than another. The structure is organic, all parts of the structure grew up together, and no part makes sense without the others.

Not sure I understand what you were trying to say.

But here's the short of it - we don't know with certainty why production has been flat the last few years. Until it is clear that production will never be going up again, we can't say we have peaked. Organic or not.

Throttlin back on the turf builder and the lawn's lookin' kinda puny.
High energy prices and falling house values caused consumer spending to be flat last month.
(household spending accounts for 70% of GDP) and from news

Coal deliveries interrupted, intermittant electrical, pipelines sucking air, spot shortages, .....

"Scotty more power!" Federation ship (economic) Enterprise listing slightly

I not only 'throttled back' on the turf builder, my lawn is now a 'Darwinian Delight'. It is strictly survival of the fittest out there. The St Augustine is holding its own in spots. I still mow it occasionally and it is still green...well, sort of green. It also gets much less to drink than in years gone by.

My days of wasting water and fertilizer on a lawn are over...Some of the natural plants that are taking over are interesting to look at and are very draught tolorent. I admire their tanacity.

My definition of a lawn:

That which you mow.

I couldn't care less what's growing out there, and I only mow it fairly lightly. I just want a bit of a moat around my house.

I'm pretty much the same, though hope to gradually convert more of it into food production. I am also going into beekeeping, and am thinking about maybe just scattering some clover seed around to give them a little something more to feed on.


I can just see you casting a few sprinkles of moisture to the competing species with a hearty "good luck here's your post peak diet"
Same routine I do while feeding the cat nowadays. Dry cereal and just a whiff of the canned stuff as I observe "you are considered a delicacy in many parts of the world"

Economic Peak Oil is what might be considered. Economic expansion requires energy and/or efficiency increases. Economic health is measured by growth. A plateau is stagnation.

Peak Oil would make no more difference than Peak Wood if we were transitioning via efficiency or other power source.

The 1973 Oil Embargo gave people an event to key on that energy is going into constraint. With Peak Oil we are the proverbial frog in the pot of cool water set on a fire. People measure events by having a date. We can only know Peak Oil in hindsight.

The mortgage crisis is growing as more and more people cannot afford their commute and house payments. Pakistan, South Africa, North Dakota and others have experienced shortages in the last year. All indicators that the economy is past peak.

Try putting a trendline through the production data to smooth out the 'noise'.

As you say, it cetainly isn't the BAU 1.6% per year IEA predicted growth - and that little spike up at the end of 2007 may be an attempt by somebody to save face/manipulate the market - these data are not as robust as you might expect and are often subject to later quiet revisions.

Hmmmm! ... Let me think about this! ... a LOT more oil (about the same growth we would expect for a whole year in just two months) is suddenly added to the market and the price goes UP 10% to RECORD LEVELS! ... To be explained in economics 101 ... or not!

You have to remember the order of things - first you need an affordable excess of oil waiting to be supplied, then the world economy can grow by consuming the excess.

No excess oil supply? ... No growth! ... and because the financial system nowadays is almost completely debt based and must have growth to pay the interest (CDOs based on NINJA loans were just the last throw of the dice by desperate bankers attempting to keep the exponential debt growth going) ... a collapsing financial system!

How long do wind projects take from initial proposal to finalizing construction? Started a topic on whether Wind power in the US [has] stalled? at po.com and haven't dug up a solid answer on my own. I notice the AWEA only lists 3506.38 MW of projects at the moment, as opposed to last year's record breaking 5,714 MW. Can 2K MW of proposals get drawn up by spring and finished by early next winter, just to (roughly) achieve zero growth?

KevO has started his own po.com thread on the fact that the UK MILITARY says NO to Wind Farms. Turns out they jam radar...

There is a 22 month lead time on the turbines above a megawatt. The top of the line gear these days are 2.0 to 3.0mw systems and they cost roughly a dollar a watt.

You need at least fifteen months of wind data from a location to evaluate it properly. This is micrometeorology at work - air above 30m moves as "parcels" rather than the Brownian motion we know at the ground level. The national wind maps tell you were to start looking, but you sure can't place a turbine based on such information.

There are choke points associated with construction equipment - there just aren't enough big cranes to put up all of the planned turbines even if we had the manufacturing to make them.

Those are the "inside the ballpark" issues. Get those problems solved and you've still got NIMBYs, grid interconnection, financing, and all of the other stuff that comes with doing a large scale project. We've got roughly half a billion dollars in wind farm construction scheduled within a six mile radius around my house ... we'll just have to wait and see if turbine bases start going in this spring. One of the companies involved is owned by Iberdrola ... and I hope we're all aware that Spain is the only country with worse mortgage antics than we have here in the United States.

Friend of mine works in the Steel Industry and due to backlog cannot commit to building the high number of turbines required by the large entity. Large entity wanted four digit commitment and the company committed to ONE!

Thanks guys. Looks like wind will be...taking a breather for the year!

Kansas ranks #11 for this year, a good round 100MW. In my po.com post I also linked to some business regarding provisions in story:

In addition to specific policy sessions, WINDPOWER 2007 attendees can expect updates on policy developments taking place on Capitol Hill. One these much anticipated and controversial developments affecting the U.S. wind industry is the anti-wind provisions of H.R. 2337.

As reported in Wind Energy Weekly last month, provisions in the bill would burden the wind power industry with new requirements that have never applied to other energy sectors. Specifically subtitle D of the bill would direct the U.S. Fish & Wildlife Service (USFWS) to review every existing and planned wind project, a mandate far beyond the agency's resources and capabilities, and criminalize operation of wind energy facilities not formally certified by USFWS. Under the legislation, landowners and farmers with wind turbines on their property would be subject to invasive inspection requirements at any time; landowners and farmers could face one year in jail or a $50,000 penalty for constructing or operating an uncertified wind turbine, regardless of whether it is for personal use or on a commercial scale.

From to policy updates on bills such as H.R. 2337 to a turbine vendor forum to U.S. project development overviews, WINDPOWER 2007 will include more than 250 speakers and moderators, 175 poster presentations and 50 sessions organized into tracks that—along with policy—include business and legal issues, utility and transmission, global perspectives, radar and siting updates, and small wind and technical focuses.

How's things looking for the future on the production side? Are turbine manufacturers looking to expand production for 2009 and beyond?

I'd be interested in your source for the $1 a watt.

Here in Britain it runs at £0.9 a watt for on-shore, almost double.


I'm not saying that you are wrong, just that it would be difficult to account for such a large difference and I would like to access the figures to try to figure it out, and to give me a better handle on US costs.

I am not so familiar with US sources, so it is more difficult for me to find authoritative figures.

I've tracked down authoritative sources for wind power in the States - the Department of Energy.

It seems your figures are a bit out of date - the $1 watt you quote was about right in 2003, before costs shot up.

It is currently around $1.80 - about the same as in Britain.
See page 15 of this pdf:

This is also installed nameplate cost, not cost per watt generated.

For the calculations of watt generated costs, see my calculations in my blog above - I used a high figure of 30% capacity for the UK, which fits very nicely with the US's better wind resource.

At 30%, it works out at $6 watt.

That does not include back up, grid connections or money for strengthening the grid.

Just the same, what I don't understand is that they come out with a levelised cost of 3.5 cents kwh - far lower than nuclear, which apparently they give as 6.1 cents.

I will have to study how they arrived at those figures, and whether they include subsidy.
More work, as those costings can be complex.

The prices are moving up and this is an ongoing thing - inflation at work, I guess. The faceplate power of 2.0 megawatts will produce 680kw average on an ongoing basis right here in my corner of Iowa. The rule of thumb would be closer to 500kw - we're very lucky with the sort of wind we have.

We are unlucky in that our peak usage is in July or August ... and those are the months with the least wind. That 34% utilization isn't evenly distributed across all 365 days.

Thanks for the response. It is pretty difficult for an average guy like me to work out what is going on, and there are so many ways of looking at costs.

I have got my head around levelised costs though:
And at an installed cost of $6 MW you do indeed come out to around 3.5 cents over 25 years and at 7% interest.

The problem is you still haven't paid for the grid connections and back up and so forth, so all in we are probably still talking in multiples of the levelised costs of coal and gas.

My real problem with wind though is that you can't rely on it, and you need to have coal or gas plants running continuously to jump in at a moment's notice.

It kind of builds in fossil fuel use, and in fact Germany and Denmark where they use a lot of wind power have been very unsuccessful in reducing emissions, whereas France which uses a lot of nuclear has much lower emissions.

Oh well, they probably won't ask me what to do anyway!

You vastly overstate the FF required for wind. Please note that my UK plan included 6 GW of pumped storage, 5 GW new, 1 GW existing). The additional FF burnt to support wind are likely little more (and possibly less) than the FF to support nukes.

Nukes requires a MASSIVE spinning reserve in case the largest plant (2 or 3 large nukes) goes off line in 1/50th of a second. OTOH, a cold natural gas unit can get to half speed in the time it takes for a geographically diverse wind generation to die down. In reality, they just tap the spinning reserve required to support German nukes.

France also is permanently wedded to fossil fuels with their nuclear program. An irreducible 10% FF (it would be higher were it not for 10% hydro and their over the border trade (via a large EU grid) where they dump nuke power late at night at give away prices and sometimes buy peak power.

Luxembourg has a 1 GW pumped storage plant and the Swiss (and Austrians less so) hold back water at night (using cheap French nuke power) and sell peak power later.

Nuke requires FF back-up (more than wind) and also requires major grid enhancements (to wheel surplus power out @ night and wheel power in during outages). Nukes have two faults, they are steady output and demand varies and they come in VERY large units that are either OFF or ON and the grid most accommodate both.

Elsewhere you accused me of being anti-nuke. FAR from it ! If you remember, I advised HM Gov't to contract with EdF to build 3, not 1 EPRs in France and contract them for 35 years with options for more. The fastest new nukes that England (and Wales) can get !

Why 35 years ? In an optimistic world, it would take 35 years for wind and new nukes to come into conflict. The UK cannot build enough nukes fast enough to displace

1) Retiring nukes
2) Coal fired plants
3) Natural gas fired plants
4) New loads such as ground loop (geothermal) heat pumps

in less than 35 years, where one would not welcome any new non-GHG generation.

Building 5 GW of pumped storage to help wind will also be quite useful in 40+ years if the UK decides to build more nukes and not replace 2021 era WTs.

The time horizon for "enough nukes" in UK is close to 2050 (certainly past 2033, the expected lifetime of any WTs erected this year).
You have created a false choice. It is NOT wind or nuke, it is Wind AND nukes for the next decades.


What about, the UK

1) Translates German insulation & other conservation regulations and enact them into law as is.

2) Starts building out Urban Rail as fast as the French (Leeds and the other tram canceled by Brown built first)

3) Start building the 12 GW of on-shore wind in process (and change permiting dramatically)

4) Start building the 33 GW of off-shore wind

5) Build 5 GW of pumped storage

6) Dramatically scale back wind incentives when the 5th UK new nuke goes commercial (with Windscale B, this should give UK about 9 GW of nuke). Focus on new nuke instead of new wind from that time forward.

The time scales of new UK wind and new UK nuke do NOT overlap.

I just came across this add-on feature to Google Earth. Apologies if this has been previously posted. It's a terrific visual aid to understanding world oil consumption.

World Oil Consumption

John Jason Fallows
It's said that about 80% of the world's data has a geographical element. In this representation, John Jason Fallows uses data from the CIA World Factbook to create polygons which illustrate the country's oil consumption, where one foot equates to daily oil consumption per barrel per day.

If the link doesn't work, you can just go to Google Earth Gallery, scroll down the left column to the bottom.

There's also a World Energy Consumption layer (bottom of right column), but it's very incomplete and not as visually useful.

The link to The Big Picture: Climate Chaos actually goes to the Jeremy Leggett article.


Thanks. Fixed it.

Feb. 5 (Bloomberg) -- MAN AG, Europe's third-largest truckmaker, said fourth-quarter profit rose 33 percent as vehicle deliveries surged in the booming economies of Poland and Russia.

MAN's Polish vehicle deliveries more than doubled in the last four years, while Russian sales tripled in 2007.


Russia is on track to be the largest market for new cars in Europe within two years.

Recession is here - economists

NEW YORK (CNNMoney.com) -- A growing number of top economists believe that the U.S. economy has now toppled into recession.

Dow is down over 300 points.

There is one thing economists can always be counted on to predict with reasonable accuracy: the past.

About time for another rate cut - hell, it's been a whole week.

Russian oil output has grown in 2007 and is expected to keep growing in 2008

Oil output to grow in Russia

RBC, 05.02.2008, Moscow 19:30:58.Russia's Industry and Energy Ministry has projected that the country's oil production will increase 1.8 percent to 500m tonnes in 2008, RBC was told at the ministry's press office. According to its estimates, oil output stood at nearly 491.5m tonnes in 2007, rising 2.4 percent from a year earlier. Exports of oil and gas condensate are expected to reach 256m tonnes in 2008.

As reported earlier by the Federal State Statistics Service (Rosstat), Russia's oil production grew 2.1 percent to 491m tonnes in 2007.


Based on EIA data, Russian crude oil production (C+C) has basically been flat since October, 2006, varying between 9.4 and 9.5 mbpd. And as I noted yesterday, preliminary Russian data show year over year and month over month declines in production and exports for January, with similar projections for February.

Our outlook for Russian (total liquids) production and net exports:

Published on 7 Jan 2008 by GraphOilogy / Energy Bulletin. Archived on 8 Jan 2008.
A quantitative assessment of future net oil exports by the top five net oil exporters
by Jeffrey J. Brown and Samuel Foucher

Russia’s initial 10 year projected production decline rate is -5.1%/year ±2%. The projected rate of increase in consumption, which is heavily weighted toward recent consumption and therefore on the low side, is +0.3% ±0.8%. The initial 10 year projected net export decline rate is -8.2%/year, ±4%. Our middle case shows Russia approaching zero net exports in 2024, within a range from 2018 to 2029.

We believe that Russia’s recent rebound in production was primarily a result of Russia making up for what was not produced following the collapse of the Soviet Union, and based on our mathematical model, Russia has now “caught up” to where its post-1984 cumulative production should have been.

This summer Alfa Bank warned of problems with mature Russian oil fields because of rapidly rising water cuts. Just recently, Renaissance Capital brokerage said that excluding the Sakhalin-1 Field, daily crude output in Russia has been down year-on-year since May. There have been recent warnings that new fields in Eastern Siberia are too small and being developed too slowly to offset the production declines in Western Siberia, and the most recent Russian oil export data show a 6.7% decline in total Russian oil exports in December, 2007 versus December, 2006.

Sounds like EIA was wrong (or unprecise) is it failed to notice increasing oil production in 2007.

We'll see if 2008 predictions of smaller oil production in Russia will be wrong again in the beginning of 2009.

The EIA shows annual crude oil production up about 2% (through October) for 2007 versus 2006.

However, as I said the data also show that monthly production has basically flat since October, 2006, between 9.4 and 9.5 mbpd.

And recent Russian reports show production declines. Given the age of key Russian oil fields--and reports that many of them are watering out--I am not at all optimistic about Russian crude oil production.

Alfa Bank and others have been warning that Russia's production is in trouble because they're watering out. Here's one link among many: http://www.themoscowtimes.com/stories/2007/07/10/042.html

Russia will probably show another small annual net export decline in 2007, versus 2006, but as noted above, monthly year over year comparisons (December, 2007 versus December, 2006) show a pretty good drop in exports.

In the link that started this conversation I posted an official statistics showing that oil production has increased in 2007 and that it keeps on growing (thus the prediction of higher output in 2008).

No argument about annual 2007, but the monthly data since October, 2006 show flat production, and the latest Russian data show lower production. We shall see what happens in 2008, but I agree that the Russians are projecting higher production for 2008.

In any case, it is very likely that the Russians are going to show another slight decline in annual net oil exports in 2007. When the Russian production decline really kicks in, the net export decline is going to vastly accelerate.

Russian Oil Output Falls
Tuesday, February 5, 2008

For the first time in several years, Russia has seen a year-on-year drop in crude and condensate production.

This may be of interest

Sakhalin 1 'past its prime'

ExxonMobil's Sakhalin 1 development will cut production this year by more than 25% - much steeper than expected - as the field passes peak production and falls into decline, project partner Rosneft said.

"Peak production of 11.2 million tonnes (225,000 barrels per day), which we saw last year, has passed," Lev Brodsky, the head of Sakhalin projects at Russian state-run player Rosneft, told Reuters.


That's a big drop for Sakhalin 1, about 65,000 barrels/day!

Here's the article from Reuters:

UPDATE 1-Exxon's Sakhalin output to fall sharply in 2008


"Russia, the world's second-largest oil exporter, increased output by 2.3 percent last year to 9.87 million bpd with the growth coming mainly on the back of higher Sakhalin-1 production.

But January output fell by almost 1 percent to 9.78 million bpd due to lower production in West Siberia and a 22 percent slump in output from production sharing agreements (PSA), of which Sakhalin-1 is the biggest by far."
"We view the disappointing January output as a result of problems that continue to pile up in the Russian oil sector," Troika Dialog brokerage's Valery Nesterov said in a note.

"These include swelling production costs, the deteriorating quality of Western Siberia's reserve base, a lack of large greenfield project launches last year and, more importantly, a very tough tax regime."

Note that Russian production, excluding Sakhalin One, has been down year over year since May, 2007.

Following is a comment I made to the HL Analysis of the Top Three Net Oil Exporters article from two years ago (January, 2006). Note that at the time, both Saudi Arabia and Russia were showing increasing oil production.


The following is based on Khebab's excellent work (as noted above, Khebab has some doubts about my conclusions).

The Hubbert Linearization (HL) method--using only data through 1985--predicted that Russia would produce 61 Gb in the 19 years after 1985. In reality, Russia produced 57 Gb. Actual production was 93% of predicted. As I noted above, I think that it is significant that actual production is 4 Gb below the HL prediction, given that everyone is so mesmerized by the recent increase in production.

Can anyone think of any other method that would have been this accurate? Remember, the data cutoff, used to generate the plot, was 1985. Currently, it appears that production is about 5 mbpd above where it should be based on the HL plot, but 5 mbpd is 1.8 Gb per year, so we could actually see a year or two of rising production before production reverts to the curve (assuming that it will). For what's worth, my bet is that Russia will start a steep decline no later than next year. If Russia is going to revert to the curve, if it started right now it would probably require a decline rate of about 11% per year.

Note that if Russia had followed the curve, and if current production was about 4.5 mbpd, total cumulative production would have been 4 Gb higher than current cumulative production. I suggest that you read that again.

I guess my basic question is if the HL method was 93% accurate in predicting the incremental cumulative production from 1985 to 2004, why are we so distrustful of the predicted production in the next couple of decades? The model predicts that production in 20 years will be down to about one mbpd.

IMO, this plot reinforces my concern that we are facing an immediate crisis in net export capacity. What if the Saudi plot is 93% correct?

Russian Plots are shown in this article:

In Defense of the Hubbert Linearization Method (June, 2007)

$3/gal? Here's reality in the US:

A. Move closer to the office

B. Buy a more fuel-efficient car

C. Switch to a car pool or mass transit

I think a move back to car pooling or mass transit coudl happen a lot sooner than that.

Having lived through the 1970s energy crisis, I can remember lots of people carpooling where I worked, and lots of people taking the bus. If the price of gasoline squeezes the household budget tightly enough, people will do what they have to do.

I should also point out that in the 1970s, it took quite a few years before many decent fuel efficient cars became available. The few that the Big 3 came out with were pretty bad. Car pooling, however, could be and was implemented almost overnight.

Relocating closer to the office makes sense, but is actually the MOST DIFFICULT thing to do. Also, if a lot of people want to start doing that, it will only happen for those that have a house to SELL that is also close to SOMEBODY's employer. Those that are located pretty far from just about all employers are going to be stuck in a house that just about nobody wants.

Agree. When gas prices spiked after Katrina, several of my coworkers inquired about my spare bedroom. They were only half-joking. There are actually a couple of guys in my office who do that: rent a motel room nearby for $100/week, and only go home to see their families on weekends.

Some also started carpooling. The ones who lived an hour away or more, mostly.

However, most no longer do that. In one case, a fight over what music should be played during the drive ended a friendship.

We have "commuter rooms" here in silicon valley. You get the room Monday evening to Friday morning, and on the weekend you go home. Some people shower at work and sleep in their vans.

I predict that company parking lots are going to be the final resting place for all of those gas-guzzling RVs.

How does weekly commuting affect their marriages? Somebody has to mind the kids, and that can't be very "equal" in the current sense if one parent is away all week and some Saturdays, and half-dead the rest of the weekend. Also, if they need to commute that far, it suggests something about the job market near home; the more stay-at-home spouse (is it usually the wife?) might get rather irritated working at a comparatively dead-end job rather than pursuing a career.

The weekly commuting isn't ideal, but you do what you have to do. I've done it, my wife has done it, I'll bet that most of the guys on here that have worked a spell in the oil patch have done it, and anyone that has worked on an oil platform has definitely done it.

Kids do make it a lot harder on the spouse left to care for them, though, agreed. Getting a divorce isn't going to improve the situation any, though.

The one big problem with relocating close to the job: what if the job goes away, and what if the housing market is lousy and you can't sell to relocate to the next job? That might, in fact, account for some of these weekly commuters. They might have had a job closer to home at one time, but now that job is gone and they have had to take what they could find. If they are living in what is a depressed area (which happens if a major employer shuts down), they might be stuck.

One thing different from the 1970s is that now we have the internet. There are several websites set up to match people up for carpooling. It really was a pain to try to find people living in the same general area and working in the same general location. With the web sites, it should be a snap to match people up.

I think you are missing the big picture...

This will NOT happen in a void, it will happen at the same time we have a recession/depression.

People's threshold for pain may/will be much lower.

Plus, at some point talk of prices becomes irrelevant. Peak oil, especially for importing nations, most certainly means shortages. Just as was seen in the 70's.

D. Unemployed and collecting food stamps


Seriously, what do you mean? If you mean that $4/gal would collapse the economy to the extent of making unemployment normative, we may well find that out at the height of this summer's driving season. (Now, at (C) $14/gal in real 2/2008 dollars, I admit that my crystal ball clouds up, but that's more than three times higher.)

My ideas on talking to people about Peak Oil.
The key to broaching a subject like Peak Oil is the way you present the topic. If you try to 'ram it down their throat', that is telling them 'this IS what is going to happen' most people immediately go on the defensive. Humans hate know-it-alls. I believe it is important to be neutral about the topic when telling someone about it for the first time. First of all, almost no one knows anything about the world's oil supply. Nothing at all, not even the current price, let alone concepts like sweet, sour, light, heavy, where it comes from etc etc. So the first time you mention it just have one key idea that you want to broach with them.
Say to them that you read an article about gasoline recently, and it mentioned that the worlds oil supply has hardly gone up in the last 2 years.
Then ask THEM if they know anything about that. Act uncertain. They wont know anything probably, so ask them if they do read or hear anything about it in the future to let you know, because you think it could be a problem for your community, and if it is going to be then maybe we should start planning for it now. From the very start try to make the idea sound like a potential exciting challenge for society.
Then every time you next see that person say you have learned a bit more and give them another fact about Peak Oil. But never preach. Get them accustomed to the concept gradually. Make them interested in it. Preaching doom from the start just triggers fear which a person easily avoids by never ever thinking giving the idea any brain time at all. They just Alt+F4 it.

The way you regard events is just a spin put on to them by your mind, according to your perception of life. If you believe life is serious then Peak Oil is going to suck. If you think life is just a game, then PO is going to be one hell of an exciting Level. And if you think the purpose of our life is for a species to populate all the stars in the universe, then, oh well, those planets will just have to evolve their own versions of Homo Foolians for themselves!

I think I remember there being a link to a downloadable version of A Crude Awakening from a few days back but I can't seem to find it in the archives - could someone point me in the right direction ?



thanks alot billp - I'll check it out...