Discussion Thread for CNBC's America's Oil Crisis

A show on CNBC tonight at 8p and again at 11p EDT, called America's Oil Crisis, may be worth discussing. Here's an open thread for you.

The first real segment of the show is John Kilduff v. Dan Yergin. It was a contrast in styles and substance, shall we say?

Very interesting, in the context of what was said and what was not. One key point for me was Treasury Secretary Paulson's comment on whether speculation is causing the recent spike. In essence, he said no, speculators are following the upward trend, not setting it.

The main take-away: more attention is going to the supply/demand equation, where it belongs. The host signed off by saying the world has reached a tipping point, and that big changes are afoot.

Very interesting, and, I thought, rather well done for what it was.

Paulson's comment about the speculation explanation was refreshing coming from a government figure. It deviated from the standard moron line that we attack the problem by attacking speculators and oil companies.

There are only 3 things that can happen to a barrel of oil when it is bought:

1. Contract delivery is taken and it is used
2. Contract delivery is taken and it is stored
3. It is sold before contract expiration

There is no speculation in #1. There is only short term speculation in #3. That leaves only #2, storage, as a playground for serious, persistant speculation. And storage isn't something you have to guess at or solve with charges about evil manipulators behind the curtain. Just look at a historical chart of oil storage (they keep track of it!) like the one I'm going to be posting next week with a look at all the shorting and "spec" longs that so many people use as an oil price prediction. If you look at such a chart, you find that there is a solid link between supply concerns and inventory levels. In the 70s, the run up in oil price was accompanied by some significant stockpiling of oil, which was undone in the mid 80s as the massive switch to smaller cars and a very bad recession finally cooled a runaway demand surge. This speculation aided the downdraft in oil that occured in early '86, when the high inventory level came sharply down and oil quickly went from $30 to $15.

In the 1990 Gulf War there was a much milder version of this. So what does this storage chart show now? It shows the oil price straying far away from any stockpiling activity. You here it often said that inventories are at their highest level in 5 or even 8 years. What these people fail to mention is that stocked oil, in terms of days of import disruption coverage, has been flat as a pancake at historical low levels for over 8 years now! There is nothing like the stockpiling episodes of the past going on. In fact, there is a strange disconnect between the historical lock-step movement between oil price and oil storage over the last 5 years. This point about speculation is further discussed by Gary Lucido at investingminds.com in the article "Oil Prices Not Driven by Speculators".

But what about all the wild gyrations in oil price we have been seeing the last couple of years? Has fundamental demand really doubled in a year? Doesn't this prove it's all just speculation? Econ 101 says that demand doesn't have to double for price to double. But as for the sharp price changes both up and down that don't seem to be linked to any fundamental like a production surge or demand ramp up, we may well be entering the condition Kenneth Deffeyes discusses in one of his books where, as demand approaches capacity, pricing becomes chaotic and volitile. It becomes a bidding war where a barrel of exported oil is worth whatever someone (or some government) is willing and able to pay for it similar to bidding on rare paintings at an auction. Here the price becomes disconnected from the normal supply/demand adjustments - you can't make up another batch of rare paintings just because more people want them. We are getting to the point where we can't whip up more oil supplies just because the demand is there. Predicting the gyrations in oil price may become like trying to predict what a rare painting will go for in the fickle hard-to-analyze minds of the bidders present.

Nicely said, Netfind. Unfortunately, I believe no one has the absolute answer(s) to your question(s). It smells like History (with a capital "H") is unfolding as we type...

I was not impressed at all with the show. No one seemed to have a clue as to what the problem really is. The Term "Peak Oil" was not uttered once and only Secretary Paulson had any indication as to what the problem really was. He correctly identified "Supply and Demand" as the culprit. The poll CNBC conducted did not even have that as one of their options.

The nation, nay the world, is about to enter a crisis of biblical proportions and only about one person in a hundred seems to have a frigging clue as to what the problem really is. We are in a world of crap.

Ron Patterson

...only about one person in a hundred seems to have a frigging clue as to what the problem really is.

You give too much credit. In my experience working at a truck stop and hearing a truckload of opinions/rants on a daily basis, I'd have to put the figure at closer to one in ten thousand who actually are knowledgeable on the subject.

This is why the CNBC special was important: it lays the ground work for easing Joe Sixpack into Peak Oil awareness.

Joe Sixpack watch CNBC!?! You've got to be kidding. If they were watching anything, it was the NBA playoff game.

Sometimes when I have a spare moment, I post at the forums at gasbuddy.com. It amazes me the nonsense that people come up with. Talk of gas boycotts, adding acetone or some other crap into the fuel. Lots of those folks are hurting, but they don't know who to blame. Thus you get rants against OPEC, Exxon, the Government, Hippies, Environmentalists. Many of these don't make any logical sense, but if you consider that most of the people in the country are apparently ignorant of how supply and demand actually work, I guess it shouldn't surprise us..

I wouldn't say that everyone over there is that ignorant - there are a handful of people who try and keep the discussions reality-based...

Joe Sixpack watch CNBC!?! You've got to be kidding.

Of course not, heh. What I was attempting to communicate is that this opens the door for more discussion in the media -- and in the general direction that it needs to go. Once it saturates the media, it will become the new "Global Warming." Not everyone will be an it-getter, but it will be more prominent in the Collective Conscious.

Sort've a trickle-down effect, if you will.

Well, I was trying to tune to the game when the remote went dead and the TV was stuck on CNBC. I was too lazy to get up and change the channel. While I was waiting for the wife to go to the store and get batteries, I watched the show long enough to learn a few things.

When you travel, don’t put stuff on top of your vehicle. This causes drag and uses more fuel.

There is some web site I can go to that will give me the location of the cheapest gas prices in my area. Forgot what it was.

Keep the tires in your vehicle fully inflated to reduce road drag. I will have to have the little lady check that….

Just a lot of high decibel screaming and shouting, it seems to bear out what James Kunstler says, most people believe we will either "organize" our way out of the problem; example, use "gasbuddy" to find the cheapest gas on our route or technology will save us, example "coal to liquids"

A few years ago there was a rather sensible Australian government move to create a CNG (compressed natural gas) vehicle infrastructure. Then they lost interest. One reason might have been an important bureaucrat testifying before parliament, and saying that the oil price can't go much over $40/barrel because "at that price coal to oil becomes profitable". Well that's a long way back in the rear view mirror. I presume it is profitable at $130/barrel. So why are the South Africans so grumpy. I presume that fear of a collapse in the price of oil has stopped others from doing it. Now that there is a wider expectation that the oil price will stay reasonably high, why won't CTL projects spring up everywhere that has coal? It is surprising how fast American business moves when it senses a profit. The rest of us try to catch up (or, in the case of bio-ethanol, try to avoid the mistake).

Which brings me to another coal question. There seems to be a lot of coal that is too deep for coal miners. Surely we can replace humans with robots in underground mining?

CNG is a sensible medium term option for Australia because its clean(ish) and we have a lot of gas.

why won't CTL projects spring up everywhere that has coal?

Oh I don't know, maybe its this climate change thing people keep talking about?

The first fully automated (read remotely operated or robotic) longwall was run in the United Kingdom in the 1960's. It was called ROLF . The deepest mine was apparently at 5,000 ft in the UK, though until I looked I hadn't thought they mined deeper than 3,000 ft, in Kent. The main reason that mines don't go deeper, at present, is that there is enough coal, closer to the surface, that is a whole lot cheaper to mine. It is only when the coal is exceptionally good, or the country is desperate for the resource (e.g. Ukraine which now has mines that I seem to remember go down to 4,500 ft) that mines start to go very deep.

Slowly remote and robotic control are coming to mining, but the changing geological conditions make it more difficult to program machines to work effectively, and in the varying geometry (seams can go from 5 ft thick to 18 inches in less that 150 ft) human miners are just that much more flexible.

I think a review of the ethanol financial debacle is in order. Great interest and government mandates and subsidies still can't make these companies profitable. Look at PEIX. The own the west coast for ethanol and can't earn a dime. Most plants on the board for 09 and out have been cancelled due huge losses in the industry.

American business moves fast when is senses a profit is correct.

Maybe they don't sense a profit.

To respond to your last question first: Yes, the coal industry (at least in the US) HAS gotten away from the old deep coal mining using human labor scheme, and they've done it rather destructively by using a technique known as 'mountain top removal'. It's fairly self-explanatory: they dynamite the tops off of mountains in Appalachia, pull the coal seams out using heavy equipment, and dump the remains in nearby rivers and streams. Real nice solution.

That aside, I think the coal industry is already poised to make a resurgance. Every other side ad in CCN's website lately tends to be from this Orwellian thinktank called "America's Power" (http://www.americaspower.org/). Their point for existence seems to be to try to remake the coal industry's image with a load of "greenwash". Look for a lot more of this as the coal monster awakens.

hey come on. just the use of the terms supply and demand and saying that it's NOT speculation is a big deal.

they probably had an agreement beforehand--no one utters the words "peak oil"!

I agree that it's slow, but understand...Joe Six Pack isn't anywhere close to being ready for any of this knowledge or change in mindset.

That only 15% of their poll blamed the consumer says it all.

Hell is anyone, really?

Well if you include Congress with us consumers, you get up to 45% in the poll. Still an awful small number.

Frankly, I was disappointed in the show. The Glenn Beck segment with T. Boone Pickins was much more informative I thought.

Agreed. T Boone and Beck at least echoed a lot of the sentiment I read here on TOD.

Agreed. Ironic that Beck's show was much better than the show on the same day presumably dealing with "America's Oil Crisis."

Boon talked about PO and oil decline -- says he thinks we reached PO in 2006 or 7. Beck in agreement, and mentioned PO as well.

Beck's show had some great video clips of a couple of members of Congress (Democrats) laying into the oil companies, clearly pandering for re-election, and not telling the truth about PO. Boon keeps repeating that they are not working to solve the basic problem -- oil supply is dwindling. Congressional leaders could have started promoting renewable energy decades ago, but didn't, and still ain't. Amazing.

Boon is investing over a billon on wind farms in TX. Very basic message: we have a problem, let's start working to solve it. I really like Boon's calm, "just the facts, mam" straight forwardness. Quite a contrast to the histrionics and near-sighted spin on CNBC. The degree of mania almost looks like an unconscious reaction to mounting anxiety. And, were I a Freudian (I'm not), one might suspect that this is reaction formation. They know about peak oil "theory," but are afraid of it.


Michael, the contents in the page you link are excellent! I have a long history of peak oil and energy research in the Internet and this is going to be one of my favorites! Bravo!

"Agreed. T Boone and Beck at least echoed a lot of the sentiment I read here on TOD."

Is that the new measuring stick of informative, that it "echoes" what I already believe?


Well ... no. But I am leaning towards information that I am reading and learning here...and seems they hit the nail on the head for me. This thread was about our opinions on some TV events dealing with the Oil crisis. Nothing more.

So tell me, PG, what happens after you actually convinced Joe Sixpack that this is a problem? Let me ask that another way - what utopian dreams do you have that are about to get smashed by red clawed apes?

GZ, I am not advocating the convincing of Joe Sixpack--and that's never been the goal of why we do this (at least not for me), in fact I fear the day he starts coming to grips with the problems that confronts him.

Surely we all understand by now that it will be the elites who learn about resource depletion first, and they will do all they can with that knowledge to exploit it to feather their own beds. After they're done, that's when I become worried. It will be an odd game of king of the mountain, but with resources.

I have no utopian dreams GZ. I am merely compelled by the potential transitions of our culture, the potential destruction of our middle class, the potential devolution of our institutions and rights...to what point? Do you hear me expressing hope? I think not. I see ways that the culture that emerges from this transition will be better, and I see ways that it will be much much worse.

In other words, something will come out the other end of this cow--it's just a matter of what goes in and what comes out after going through all six stomachs...

Then why worry about whether Joe Sixpack ever understands this? In a world of population overshoot and resource scarcity, luxuries like "human rights", "liberty", and "democracy" will very probably all be sacrificed on the altar of "save my ass", so why does Joe Sixpack learning about this matter at all?

Remember, you were the one that raised the issue of Joe Sixpack learning about this stuff, not me. Why does he even matter?

of course, taken to its logical extreme, yes.

actually, I was responding to tongue-tied and twisted up above in his parlance...but (and I get where you're going) of course JSP matters because he is what keeps the machine running, GZ. on the other hand, the elites can obfuscate for as long as they wish...until they can't...

At the end of the day, this is still human life we are talking about...and the amount of suffering that this could bring absolutely haunts me. That's why I do this...because we have to try, even if it's futile.

Some think that foolish.

The tsunami is visible in the bay. You can grab the hands of those nearest to you and run inland and for higher ground right now, hoping that at least a few of you make it, or you can stand on the beach sounding an alarm that will get ignored and go down with all those others on the beach with you.

No one here is yet willing to use the word triage. And I mean that literally. We're past the point of no return. If we really wanted to save global civilization, we'd have to let the weakest parts of it die to focus on those we choose to save. Since we (collective we) are unwilling to make that choice, the entire structure is in trouble instead. Instead we (collective we again) keep lying to ourselves, telling us a hero's tale that we can actually save everyone if only, if only, if only... something (choose your favorite remedy here).

We (collective we) will have finally grown up when we realize that we do not have that option and instead must make very hard decisions. We're not yet willing to make those hard decisions and if we wait too long, the decisions will be made by nature for us. I've seen this immaturity before, in young soldiers who think they can save the world and all their squad buddies too. Then they finally wake up and when they do, the depth of pain in their souls is truly harrowing as they realize that someone, someone they know, may have to die that others may live.

But carry on. Keep pretending that everyone can get through the coming bottleneck. Keep lying to yourself that trying to shove everyone through actually matters. Triage. That word means real pain, personal and otherwise. Until global civilization faces that word squarely we don't have a chance in hell.

In regard to the tsunami allegory:

You could also run like hell whilst yelling the alarm and get the best (worst) of both worlds.

PG GZ both your perspectives are valid, so why not do the tango (or contango if you prefer)

This life is temporary for all beings, so it becomes a question of what choices one is comfortable with ethically/morally for oneself.

Myself, I can't wait for the riots to begin so I've got some moving targets to practice on, my wife tends the critically ill and thinks I'm The Devil, we still love each other very much.

Transience - There is no pain, only disappointment knowing that great potential has been wasted.

All must be swept away so a new cycle can begin. Rejoice, Mother Nature is composting in preparation for a fresh planting in spring.

If we'd all stop eating meat right now, did a crash programm on solar, wind, dam projects and "nucular" plus a railroad building programm we could nearly make it. Conservation is as well important. Also, free condoms and free sex/contraception education for everyone. Hell, we should play the Bartlett video to anyone on earth at the age at 15.

Given the influence wishful thinking, stupid planning and religion/ideologies have, this won't happen. :-((


Frankly I don't think you get it either. What you are proposing is that if we piss around the edges, we can maintain business as usual (BAU). I would suggest it is BAU that has to go which gets into the areas of economic systems, governance and societal philosophies. To me, this is what GZ is suggesting with triage.

I've posted numerous times that I have lived in the boondocks for a long time since I left the chemical industry. I live in a different reality than urban and suburban people. I know this is the case because I've lived in both worlds including time near NYC and other large cities. I want to emphasize that this is a different reality. In fact, I've been working on a post I've tentatively titled "A Sense of Place and Your Future" because of the large numbers of negative responses to a post I made on Monday's DB. I've held off posting it since there have been a bazillion posts about the increased price of oil.

As someone noted down thread, most relocalization efforts are also pissing around the edges. GZ'z triage is coming and people will be either on the bus or off the bus. The ones who will most likely make it are those who have already come to grips with what will come down and made concrete changes yesterday or the year before. The laggards are doomed.


No one here is yet willing to use the word triage.

Interesting point. While digging up the ground on the property to get seeds in the ground I was pondering my experience with the local Peak Oil group.

In the tradition of 'lets solve a problem' - they wanted us to visualize what the city will be like in "the future". Ok fine. At the end, I came to "If we do not know the population level or the overall energy aviable - how can one have this vision?"

Tonite, while digging, I thought about attending the screenings of some movies they are going to preview. And my thoughts came back to the meeting - to a point about "if electrical power stops for a week in the -40 deg weather - what's the plan?" And Alan/New Orleans.

And I used the word triage in my head. And pondered:
1) if 25% of the citizens work directly for the government - where do they fall in triage?
2) If one has a criminal record?
3) If one does not have tax payments under X? Over Y?
4) Gender, race, religious belief?
5) How about simply free booze/drugs so that many just kill themselves via their use?
6) Various illnesses?

Do keep mentioning Triage in drumbeats - and any ideas you have on how to do that.

Peak Oil triage will be self selecting. In medicine the doctors do the selecting, but in the Post Peak Oil world individuals and coutries do their own triage selecting. The world just has to let it happen. That is the best thing to do and is the reason doctors do triage.

Haiti has decided to self destruct. So has Zimbabwe. Egypt subsidizes food for urban residents and imports it as well. Bangladesh: need I give more examples?

Individuals do the same thing all the time: drug users, cigarette smokers, over eaters like myself, and many others have evils and vices that self select the next to die.

Some Peak Oil aware also self select to die. They are called doomers. They reject mitigation with ethanol. They reject using the U.S.'s considerable resources to its own best advantage in the name of vague benefits that supposedly accrue to the starving in other countries or the environment. Some insist that conservation is the only solution which imposes even more stringent constraints on mitigation. In effect they are selecting death.

Others overgeneralize that the problems in some parts of the U.S. are true throughout the country. Regions that are trying to deal with the situation by rapidly developing wind energy or ethanol are dismissed as too small to mean anything in the big picture.

Maybe so, but for certain parts of the country it will mean survival. Locally, Winnebago Industries is practically shut down during its normally busiest time of the year. Corn is no longer exported. It goes to the ethanol plants. Giant wind turbines are being erected. My place will have about half a dozen a quarter mile across the fence. It is changing the whole feel of the countryside.

Hopefully northern Iowa has self selected to be surviver of Peak Oil triage.

Ethanol is self-selection to ecological catastrophe. This has been demonstrated multiple times over yet you, kdolliso, and the other ethanol propaganda pushers keep pushing your lies, just so you can feed at the public trough.

I realize that the original discussion of triage was in regard to population, but here is my August, 2006 discussion of the topic in regard to the 'burbs. I frequently call Alan Drake my Peak Oil Tranquilizer. At least he has a plan for making things "Not as bad as they would otherwise have been."

Net Oil Exports Revisited
Published on 21 Aug 2006 by GraphOilogy / Energy Bulletin. Archived on 21 Aug 2006.
by Jeffrey J. Brown

A Proposed Triage Plan

I believe that vast expanses of American Suburbia are going to become virtually abandoned in the years ahead. Alan Drake has noted that a good deal of suburbia was so poorly constructed that a lot of it is biodegradable. Alan has outlined how we can go back to what we used to have: electric trolley cars connected to electric light rail lines.

CBS Sunday Morning, on 8/20/06, had a segment on "tiny houses." They profiled a home designer and builder who specialized in building very small functional homes of about 100 square feet. You can find more information on his website.

What this builder has realized, and what millions of Americans are just beginning to also realize, is that anything over 100 square feet or so per person is not a necessity; it is optional consumption, a want, instead of a need.

The US is not Switzerland, but Alan Drake has described how Swiss per capita oil consumption in the Second World War was about 0.25% of current US per capita oil consumption. They did it primarily by electrifying their transportation system.

I propose a sort of triage operation: "tiny" homes and multifamily housing along electric mass transit lines. In my opinion, it is the only way that we can preserve some semblance of a civilized society. The suburbs are, by and large, a lost cause.

Triage sounds great -- until you realize that YOU might be the one to be "triaged".

I think the Americans with Disability Act is going to fall by the way side pretty quickly. The capital needed to upgrade streets and buildings is already disappearing.

I was once a Joe Sixpack, and have voiced umbrage at that misleading, sterotypic, moniker. There was once a time in my life where I had to work two full-time jobs to earn enough cash to provide for myself and pay my debts during which I had no opportunity to remain informed unless I forced myself. When I worked 60-70 hours per week as a restaurant manager, my leisure time consisted of going to the beach, getting high and making love to my wife, not trying to figure out how the world worked. I look back on those days as blissful. It turns out I was lucky enough to attend upscale public schools at a time when they actually taught something, even though my behavior caused my expulsion. Circumstances allowed me to embark on my collegiate career in a self-taught, self-directed manner while still working 50+ hours a week. I then re-entered college and graduated 4.0 Summa Cum Laude by making sure I treated every course as grad level by piling on additional texts, and used semester breaks to self-learn subjects I was interested in, like microbiology, that my educational plan didn't have room for during the regular academic year. My point is that if I can do it--understand the world's intricacies and parse its problems--then any Joe Sixpack can--even the brain damaged, 70 IQ men that worked for me, and the ADHD college students I worked with. You put us down, count us out, and treat us with the sort of contempt Orwell did of the Proles in 1984. That's unacceptible.

Rant over. The program stunk, although I admit to watching only a few minutes when it was about half over and the admittedly felonious stock-price manipulator Jim Cramer appeared.

By the tale of your very interesting life's story, you're obviously not joe sixpack, a moniker for one who lacks the will to learn the depth of complex systems.

Wow. I haven't been reading TOD much and comments like this only support my decision. Not everyone has the capability or time to learn the depth of complex systems to the extent of most readers here. But what I do see with many people who lack a formal education, work two jobs, etc... is that they have skills that many elite, educated folks lack AND an attitude to roll up their sleeves and get things done when needed. Best to be in camp with them...

My experience with so-called "progressives" - and I consider myself a progressive - has led me to the conclusion that I need to be "in camp" with working class and devout folks in my neighborhood. Most progressive "activists" I know couldn't organize themselves out of a paper bag and have no idea how to nurture community or do much of anything productive.

Get what done? Build a bigger McMansion? A bigger SUV? Without at least a half-witted attempt at intelligent planning, all the workers can roll up all the sleeves they want. They wont accomplish anything. And as we have seen over the past 20 years, their efforts might only worsen the crisis. A million SUVs on the road means a million tons of steel being hauled around as mostly dead weight. Millions of tons of coal wasted to produce that dead weight. It just goes on and on and on. McMansions collectively require millions more tcf of gas to heat. Just cutting down on those two things, McMansions and SUVs, would go a lot further towards solving our energy problems than a crash program for ethanol, solar, and wind. But if the right decisions are not made right now, then people are gonna be "rollin up their sleeves" and digging holes to bury themselves and their families.

This rang a bell with me.

I was reading the comments here and feeling uncomfortable with the "Joe Sixpack" label. It often seems to be used in a denigrating sense. I argue that this is contrary to the best interests of those who want to spread the understanding of peak oil as widely as possible. If someone who may self-identify as a Joe Sixpack happens by, they may feel unwelcome and move on. We need everyone to understand.


As a first generation college student of humble origins myself, I will attest that I am put off by the JSP term as well--and probably shouldn't be using it. Too many assumptions about class and educational mobility, etc., etc.

When I used it, I meant it in the sense of those unable or unwilling to learn--whether or by choice or by circumstance--about the world around them. I should be defining my terms more clearly.

Yes, it's still way too broad of a brush, but I was trying to make points about the complexity of the systems involved and how difficult it is to learn about this stuff...and how some just cannot or will not ever have the chance to "get" these ideas and in turn will be the ones to suffer for it.

But people can learn and people can change...I see it every day.

I have often used the terms sheeple, shmucks, etc.-my thinking has always been that if you are reading these comments you are logically disqualified for those descriptions. IMO the JSP term is the same-if you are truly JSP, what are you doing reading TOD? Was it somehow linked accidentally to some porn site? I always felt the term implied a lack of intellectual curiousity, not a lack of money or status-clearly many prominent posters on this site aren't flush with cash.

The people most likely to survive a catastrophic end to our civilization (if that is what actually happens) will be those who are least dependent on it now. Joe SixPack, Herman Hunter and Tammy Lee TrailerDweller may be better able to survive being cut off from the fuse box of modern life than degreed nincompoops such as myself. (Can I trade my sheepskin for an actual sheep?)

I hope what is more likely to happen is the musical chairs approach, where things just keep getting worse and worse, people make up all sorts of clever and frightening tales to explain what’s going on and in the mean time, they just adapt or die. Those that adapt get to keep living (your results may vary.)

What’s the best advice you can give somebody? Expect things to get worse and plan accordingly. And if they don’t listen? Well, you can lead a horse to water…


Maybe I misinterpreted the term 'Joe Sixpack'. Are we talking a six pack of Hamm's or six pack abs? ;)

the potential destruction of our middle class,

Compelling arguements can be made that the 'middle class' is already gone.

I hav'nt seen the show yet but the other day, while flicking CNBC on as I walked passed the TV doing other things, I heard them mention peak oil twice.
Although Matt Simmons has been on there many times I think they are actualy starting to get the situation now.

mostly hype & hot air; i turned it off the last few minutes.

as hirst said the other day re the peak oil problem & our lack of addressing it:

"as massive as one can possibly imagine".

yep ron ,we are in deep doo!

Since I watch CNBC daily for the crude and RBOB prices I figured that this show would be a waste of time and didn't watch it, and from some of the comments here it looks like I was right.

I don't get CNBC because I have basic cable. However, Paul Krugman, in the NY Times wrote of Peak Oil on Monday 5/19/08. He doesn't get the seriousness of the consequences. He believes we would be ok if we drank oil the way Europeans do.

I got bored with it and turned it off and went and did something constructive. They seem so preoccupied with hopping and bopping from one quick interview to another, with little of any substance to the conversations, that it just seemed like so much fluff. With all the advertising of that special I thought they had organised a set of ideas relating to peak oil, and would lay the groundwork for where we are today, and the where the market is potentially headed for in the future. Unfortunately not. Mostly what we got was, "Ok then, what stocks do you recommend then?!" "So what looks good to you? What sector, come on give me something!" As if to say the whole problem could be solved with the right stock picks.

America's oil crisis....now how can we get rich off this? Morons.

Interesting that the first suggestion for investment was a Canadian oil and gas trust fund, I missed the first part, being out at the farewell Departmental Dinner for the semester, but didn't see anything in the second half that you couldn't have picked up here (apart from the stock picks, and the price of houses in Houston).

Yet I think that there is a growing sense that this isn't just a debate among academics, but that there may be a little more of a problem than realized, and to get that message across you have to start getting the MSM to understand this. This is a step in that direction.

Here's a nice animated cartoon on Peak Oil in the Daily Telegraph - English MSM


CNBC showed bits and pieces all day long. No matter how crummy it was, at least it heightens awareness. Isn't that good? Would you rather have no programs than poor programs? Save perfection for the next lifetime. We ain't gonna find it here.

Joe Six Pack don't mind if you call him that.

America's oil crisis....now how can we get rich off this? Morons.

I recall the last words that actor George Saunders left behind for the rest of us. Something about us keeping our sweet cesspool. I thought it odd at the time, and maybe old George was just bitter, but then again, he was a sharp guy.

Over a year ago I attended "A Conversation on Energy" put on by ConocoPhillips in my town. Being well aware of peak oil I expected frank discussions on the issue. The Conoco representatives gave a very brief intro, significantly understating the problem, then solicited input. I was amazed. Some angry comments were: "We are tired of paying your high prices", What are you doing to prevent the Chinese from getting OUR oil?", others were "Biodiesel is the answer". People had no grasp of the scale of the problem. The driver that delivers my fuel oil told me "there is plenty of oil in Oklahoma, they just aren't allowed to pump it". Alice in Wonderland. If you add climate change to this, and the impact converting coal to liquid fuel will have on it, we're toast. Most people are even more clueless on this issue. We need a massive WWII scale effort to combat climate change and a Manhattan Project approach to alternative energies and eliminating CO2 emissions from coal burning power plants - otherwise coal isn't an option. We're just fiddl'n while Rome burns.

Well put and all, I think Rome is going to be burning for quite a while, the real question is how much will be left of it?

I agree Curious Tom. Get all the best minds together and come up with a new energy game plan on a mass scale.

The new energy game plan is that shortly, due to the mounting entropic forces of social decay, environmental devastation, system shutdown, and population overshoot, there will be drastically less energy to go around for most everyone.

Drastically less pharmaceuticals, insecticides, transportation, food, and potable water for the majority of 6.7 billion people.

That's our new energy game plan on a mass scale.

What is it about the MSM (CNBC this time) and the American people that feels compelled to assign blame to every change that comes along. This crisis, PO, is so much bigger than any of the institutions or groups involved that it seems naive to assign blame. Blame assumes that there is negligence or wrongdoing. Perhaps this is just something that happens in the course of human events -- bigger than all of us.

There is always blame of the elite institutions for not taking care of us in times when we look for help, isn't there?

Imagine a post-Katrina survivor looking to government for help and finding none coming in time to save them. Or imagine a depression-era person who lost it all, looking to government to get them back on your feet.

Government came, in different ways, and to different levels of effect. There are many other examples, some local, some federal, all tragic.

We blame those we believe are "taking care" of us when we are not taken care of. I am not saying it's correct, or even efficacious, but it is what humans do, and have done, for a very long time.

"Imagine a post-Katrina survivor looking to government for help and finding none coming in time to save them. Or imagine a depression-era person who lost it all, looking to government to get them back on your feet."

A observation that we humans seem to be oblivious to sound warnings seems all too apparent regarding the event you highlighted.
Why would you live in an area that is below sea level?
Why would you live on an earthquake fault?
Why would you live in the shadow of a volcano?
It seems to me that for the most part we have been sold a bill of goods by our parents, teachers, politicians, et/al that it won't happen to us because we are special. Our education system is not designed to teach us to really think for ourselves and to consider others or their well being in my opinion. It seems that greed and climbing to the top of the hill is our modus operandi, (let me get set up before the masses finds out that the scam is up) I have to agree that Bartlett needs to be tought to every person as soon as they are able to comprehend the concepts. But then the "rulers" would have a hard time subjugating the peasants. Every once in a while I read or watch some MSM and am often suprised by the complete lack of substance, or flip flopping that occurs. I can only hope that the next few years are not as dire as some predict, that the world population can somehow get through the comming changes without totally destoying itself, through wars of greed and selfishness.

The continuing energy crunch will I hope force those who are responsible for building codes, come to their senses, where I live above the 53rd parallel the smallest house one can build is 750 square feet. Urban planners seem to pay little attention to solar gain, the only reason for cramming houses so tightly together in my neck of the woods is to reap as much profit as possible from the development (greed).

I am not too optimistic about my childrens future, but at leaste they will have a place to get to if things get too tough. My well insulated passive solar house will operate on minumum energy.

Worried up north.

Speaking of TV specials, there was a lousy one on sundance regarding coal vs the people of West Virginia.

Lot of party line and tears, boo hoo, but there was a funny line.

The coal companies were having focus groups to try to figure out why the residents really hated the coal industry. There was an anecdote that one person in the focus group said, and I quote from the show,

"Why do we have to use coal anyway? Why can't we just use electricity?"

Gotta love it.

My grandson of 8 had a similar revelation. He looked at his father one day and, all excited, said " Dad! You don't have to go to work anymore. All you have to do is get money out of the ATM machine"

Gotta love the Cargo Cultists.

Hurricane Season Countdown

9 Days 1Hrs 51Mins 33Secs until the beginning of
the Atlantic Hurricane Season
June 1, 2008

I wish I could say that I was looking forward to it.


It says it's very likely we'll have a good number of major hurricanes, a lot of anxiety, but luckily little damage to the GOM infrastructure.

Of course, they can predict that now too. Really well.

(hat tip Luis on this one.)

If the hurricanes are of a high frequency and intensity this year it is because of global warming. If there are very few hurricanes this year (like the last 2 years) it is because of global warming !!

Thats it, lets set ANY conditions to mean global warming! Then it will definitely be true.

Radio talker Mike Malloy spent some time talking peak oil tonight. He has long discussed it, and not in a hokey conspiratorial sense like the Coast-To-Coast show. As always, he had some interesting takes, especially concerning the religious right's belief in abundant oil. His response was "Well the Lord giveth, and the Lord taketh away".

Radio talker Mike Malloy spent some time talking peak oil tonight. He has long discussed it, and not in a hokey conspiratorial sense like the Coast-To-Coast show. As always, he had some interesting takes, especially concerning the religious right's belief in abundant oil. His response was "Well the Lord giveth, and the Lord taketh away".

Hi, this is my first post here but I've been following TOD for a year or so. Pardon my english as I'm not from an english speaking country.
I'm seeking views on global crude oil supply demand scenario from TOD'ers. I noticed that when people talk about global demand(future) or consumption(history) of crude oil, nobody really linked them to total global economical refining capacity (plus very small percentage for storage and direct burning in power plants). These are the direct consumers for C&C and not the people on the street.

What I'm trying to say is that as long as there's no new refining capacity additions, the C&C consumption/demand and thus supply will stay flat at maximum feasible refining utilisation(which is probably happening now as global capacity is about 87 mbd at 95% utilisation).

This is probably the reason global C&C consumption/supply being flat at around those numbers for the last two years or so. Not because supply already peaked. OPEC might be telling the truth when they say they are pumping up to demand. I know this will not however explain the current high prices.

It's only when new refining capacities coming up next year in India, China, Vietnam etc that the real party will start....

Art, try posting your query over in the drumbeat today. it's a good question.

I often look at the crude oil stocks on hand figures that are put out fairly regularly.
Lately, Most of the time, they are in the lower range from average.
To me, that looks like they are having trouble getting crude supply.
One question I have not checked is, what is the availability of oil tanker ships, to keep up with demand at this time ??


( http://www.angelfire.com/in/Gilbert1/tt.html )

It is almost comic.
Treasury Secretary Paulson has been called virtually a liar on every point he has discussed regarding the "sub prime" crisis, but now when he assures the world that "speculation" in the oil business is a non factor, he is hailed as wise man of virtue and his words are taken as holy writ! :-)

Why of course there is no speculation! The price of oil moves 10% up and down in a matter of minutes because supply and demand moves up and down 10% in a matter of minutes, and those wise asses running around Wall St. and the NYNEX in Mercedes and Hummers are...what, well paid janitors?

And of course the fact that we have still spent more time at war in Iraq than it took us to win WWII has no effect on price...we all know that right...after all the neo-cons were very clear in their planning..."a war of weeks, not months".

Oh, the dollar decline has nothing to do with anything, despite the fact that we have poured a trillion dollars into this losing expeditionary force mess in Iraq with no budgeting for it whatsoever, because after all, it was going to be weeks, not months, right? But a trillion dollars ain't snot nowadays, put it on the tab...

So I go back to Rembrandt Koppelaar's "Oilwatch Monthly" posted just the other day on TOD and look for the "collapse" that could be driving these oil prices to the moon, and guess what? I can't FREAKIN' FIND IT! And don't think most folks here would regard Rembrandt as a cornucopian, do you? What I do see are bigger, in some cases notably bigger, declines, "plateaus" and and sideways movements in any one of at least a half dozen prior periods and in many producing nations that went by virtually unnoticed at the time, but that are now proof that the collapse is here, today, and proof to all that oil needs to be three or four hundred bucks a barrel! Incredible.

I have said it before and I'll say it again, and history bears me out on this: PRICE IS NO PROOF OF PEAK. That works both ways by the way. Low prices are no proof that peak is not already here either. Price is proof of sentiment, nothing else. The sentiment that we have reached peak may very well be correct. It has to happen sometime, why not today. Or the sentiment that peak is here based on price may very well be incorrect, and the price may be driven by sentiment that is driven by war and a weakening currency caused by massive loss of money in the corruption that has become Iraq. But price tells us NOTHING about what is beneath the ground and beneath the sea, and how much of it can be EXTRACTED. I only wish that it did. That would be so much easier than geology and engineering, wouldn't it? Want to know how much oil is available for extraction, don't drill, don't explore, just look at the price!


What are you ranting about? Are you saying there may be another North sea/middle east in the offing? Well it better come quick!!!

You have to ignore price fluctuations, as they are virtual and really don't follow any physical laws. I use the example of phase speed, which can in many cases apparently exceed the speed of light. Of course, no one really believes that anything real exceeds the speed of light because no information gets transferred purely by phase.

I can see the price fluctuations perfectly well - I posted a few days ago that my price graph which I look for elliot wave stuff in see a guessed price of $85-$95 in the next "crash" but you would have to be blind/stupid to ignore the underlying upward trend!

As a side note i'm an engineer in defence and sometime "do" a lot of RF (radio frequency) stuff where half battle is separating the noise from the trend.


Price fluctuations do, in fact, follow the same complex and chaotic rules found in many other complex and chaotic physical systems.

So I go back to Rembrandt Koppelaar's "Oilwatch Monthly" posted just the other day on TOD and look for the "collapse" that could be driving these oil prices to the moon, and guess what? I can't FREAKIN' FIND IT!

You might check out his net exports graph. With the recent news from Russia, Venezuela, Mexico, etc., I suspect that the recent downward trend in net oil exports is continuing.

Roger: You're the one that is holding your breath waiting for your predicted implosion of Chindia-it isn't happening. Check out a chart of US dollar/Yuan-all US politicians agree that they want the Yuan much stronger-jeez you think maybe that might help drive oil prices? Of course, price is not proof-all price reflects is the marketplace starting to accept reality. I do agree that when (if) the price drops below $90 oil depletion will be pushed to the back page and stories of 400 years supply will predominate again.

Roger, for starters I have never criticized Paulson for anything so I have a perfect right to praise him for being right here. Second, I have stated over and over again that traders are indeed responsible for the short term swings in the market. However the long term trend depends entirely on the fundamentals.

Roger, that is not that difficult to understand. Think of a boat pulling a skier. The path of the boat represents the fundamentals, the wide swings back and forth represent the traders swinging the prices up and down over the very short term.

Okay, once again: Wild swings up and down are the traders and speculators trying to guess what the fundamentals will do. The long term trend represents what the fundamentals are actually doing. See how easy that was?

As for the collapse, check out this gif:

Ron Patterson


The boat pulling the skier is not a bad anology actually. So we are assuming that the wild swings of the skier are no indication concerning the condition of the boat.

Regarding the chart you linked, let's say that if the little spike down out there at the tail end is what indicates the "collapse" then everyone should have been absolutely hysterical back at that 2001-2002 drop. Of course you will say (correctly so) that 9-11-01 had a lot to do with that, and so would I, which indicates that there are a lot of mitigating factors driving oil exports, peak or no peak (and take note once more, I am not denying the possibility for a second that peak is not here now, it very well may or may not be, but price is of no value as an indication.


I think you miss the point about the boat. Skiers usually always swing back and forth over the wake of the boat. That is just what skiers do. But they must follow the boat. They have no choice in that matter. Likewise markets always swing up and down, above and below the fair price of the commodity. But they must always follow what the fundamentals dictate. Ignore the swings, look at the trend. The trend is dictated by supply and demand.

Concerning the drop in 2001-2002. If you look at a chart of Non-OPEC production during that period, you will notice there was no dip whatsoever. Non-OPEC during that time just kept on increasing production. The only time Non-OPEC has dropped off was due to the collapse of the Soviet Union. Non-OPEC production turned down in 1989, when Russian production collapsed, and did not turn positive until 1995, when Russian production bottomed out.

The drop during that period was due entirely due to cuts in OPEC production. We all knew this was the reason. We all knew that OPEC caused the dip and that there was still some new Non-OPEC production coming on line. that all stopped in 2004. That was the year Non-OPEC reached its present plateau. Non-OPEC production, C+C, has for just over 4 years now, produced right at 41,000,000 barrels per day.

We have been over this before Roger. We KNOW what caused the drop in the early 80s, it was the Iran-Iraq war, the Iranian revolution and the resulting tanker wars. We KNOW what caused the drop in the drop in 99, 01 and 02. It was OPEC reacting to $12 a barrel oil. They cut production dramatically while Non-OPEC just kept right on increasing. Now Non-OPEC is producing flat out and has plateaued. OPEC, at least everyone except Saudi, is producing flat out and has also plateaued. But because of internal consumption in producing nations, exports are declining while demand is still extremely strong. And that, Roger, is what is driving prices so high.

Note: Russia and Mexico are both down steeply in March and April. It is likely that Non-OPEC production will be down quite sharply in the last two months. That is one factor driving oil prices. I am predicting that we fall off the Non-OPEC plateau this year.

Ron Patterson

Roger never "gets it", Ron. He comes to a conclusion, warps facts to fit his preconceived notions, then writes 500 line essays that say nothing to try to obfuscate his point.

Roger is claiming that there is no "collapse" in production so he sees no basis for the run up in prices. Yet Roger conveniently overlooks that production is nearly flat while China/India combined have doubled their consumption in roughly 5 years (pretty much the same period as the flat production).

Well, if China and India are consuming twice as much but the production number has not increased then someone else is consuming lots less. And Roger, in case it escaped your fogged brain, the way that flat production (supply constraints) get resolved in the global market is via price.

Recently the IEA estimated that global production would have to be about 12 mbpd higher to have maintained the roughly $40 per barrel price of 4-5 years ago. That 12 mbpd is the shortfall that has been resolved by price increases.

Now tell me Roger, where is the 12 mbpd to resolve the price increases that have occurred so far? Where is the 8-10 mbpd needed when China/India combined pass US consumption in the next decade? Where is the 15mbpd needed when China alone is projected to pass US consumption by 2025?

In other words, Roger, production could do exactly what some cornucopians say - stay on a long flat plateau - but prices are going to skyrocket anyway, because 2.3-2.4 billion people are trying to join the 1.1 billion who are already in the middle class.

P.S. The fact that speculators swing the "tail" of the price is why playing day-to-day moves in oil is risky. But the underlying supply/demand problem is why everyone who has played oil longer term has either not lost money or made lots of money. The long term oil play relies upon scientific fact, not on market opinion, that supply will remain constrained while demand continues to rise faster than supply can change (if it can even rise at all much now). The only mechanism left now to significantly lower prices is demand destruction, aka recession/depression.

P.P.S. Where's that flood of KSA oil you promised, Roger? We're all still waiting.

China and India won't pass US consumption in the next decade. It is a pipe dream dictated by the same supply/demand dynamics that have made the ascent in demand possible. Simply put, subsidies will bankrupt these developing economies in the long run. Their comparative advantage to the developed world is cost of labor, but with input prices escalating their edge will quickly disappear.
Look at the percentage of income spent on food in India and China per capita. The real population driven energy demand drivers can not simply afford *unsubsidized* product in the long run with current CPI/consumption balances taken into consideration.

The whole Chinese and Indian labor/export model (which is the foundation of their rampant growth) does not work if the governments stop picking up the tab.

For examples, look at Indonesia. They just raised the price of gasoline (it is subsidized) to the equivalent of $2.45/gal. At a long run breakeven for refiners of $7-8 on the crack spreads (of $3.33 avg product price at $133 crude +$7 crack), that is still 27% below market clearing price.

And even with that, there are bloody riots.

Take a look at these China statistics:

The Urban consumer in China in 2006 has about $1469 of income annually. How much unsubsidized oil (at $3.33) can he afford with food already consuming probably in excess of 26% of his expenses (imagine these #s with the price increases in commodities/inflation) ?

The Chinese rural peasant (most of the population) has $448 of income. He spends 34% of his income on food in 06 (probably a lot more right now). How much $3.33/gallon product can he afford to be economically competitive in the rest of the world [only justified by his willingness to work for rock bottom labor rates]?

If you are the average Chinese or Indian, this is not the time to buy your first car. Any new buyer is on the margin, a very very slim margin.


You China+India demand pipe dreamers need to get over it. This is an Olympics diesel stockpiling blowoff top and will not be sustainable in the long run.

As long as Arab oil princes are running AC to 50 degrees F in their 5 million square foot palaces 365 days a year off oil fired power plants, they are quickly sowing the seeds of demand destruction and eventual replacement of energy sources (nuclear, wind, solar, etc).

Relax, there is no oil problem! Anatole Kaletsky, associate editor of Britain’s The Times and a leading commentator on economics, has tagged it as a little bubble, no more.

Confuscious might have said: Humankind chase oil around world, like termite chase wood around floating log at sea.

Both predicate their existence on a fininte resource, and neither scenario can end well. The termite is not evolved enough to row to shore to find more wood, and only time will tell if Humankind is evolved enough to find a replacement for oil.

Humankind is evolved enough to find a replacement for oil.

Humankind has plenty of replacements for oil.

Just not in the volume that man is used to, nor at the low level of processing that man is used to with oil.

Finding a "replacement" for oil would be incur the greatest amount of human suffering in the long run because it would continue population growth and deplete all resources even faster and make the earth uninhabitable from runaway climate change (not that we haven't already lit that fuse). Again and again, posters on this site fail to see the obvious: human population is growing by 70 million resource-eating people per year. Continuing the current setup of profligate and decadent resource consumption is about to end. Yet most people are wishing for ever higher amounts of human suffering by trying to continue business-as-usual. The only human mitigation possible is through a 1-2 punch:

1)reduce population (by not slugging out larvae like we're trying to populate 10 planet earths)

2) permaculture, natural farming, new culture of minimalism, etc. (organic polyculture, plant-based diet)

Natural methods of farming is much more efficacious and sustainable than myopic monoculture farming and insanely destructive and resource-intensive livestock raising. Though the earth appears to be crippled by the deluge of unforeseen consequences let loose from the clever little ape's Pandora's Box - I think it's still theoretically possible to support the current population if the right actions were taken. But realistically, like all organisms on earth, humans will reproduce as long as females are eating enough energy to do so. And people eating high on the food chain will continue to do so, their own health, the health of the planet be damned! I think this is why population growth isn't given proper focus when discussing the myriad problems humans face: because deep down we all know that nothing is so powerful as the sex drive and the love of children. Because of all these things, in my opinion the higher the price of oil, the sooner humans reduce their overall burning of fossil fuels - the LESS suffering for humans in the big picture. Yes, the simple fact is the more humans we make, the more humans will suffer in the future. Because we've started a set of chain reactions that will be reverberating it's negative consequences for a long time.

Or, bumper sticker style:
"It's the population, stupid." ;)

The steep discount rate of humans, and the general inability for big-picture thinking, is hard-wired into our DNA. Most people won't even remove animal products from their diet to reverse artery disease, etc (despite the mountain of scientific evidence) - even when they understand the evidence. And yet somehow we're supposed to control population voluntarily? Sex is an even better drug than food! The only real hope is that civilzation will be FORCED to make changes by nature as fast as possible...

Looks as though as its the Democratic party's fault that oil prices are so high at least according to this person http://www.powerlineblog.com/archives2/2008/05/020571.php Which begs the question, I know how much is estimated in ANWAR, could someone tell me the estimate oil reserves on both continental shelf's?? Does this person have a rational arguement??

I wouldn't take anything that a right-wing blog has to say as all that meaningful. They seem to just be parroting the line that the big oil companies are spewing right now.

My understanding is that ANWAR is estimated to hold about 10 billion barrels. That's only a rough guess - could be a bit more, could be a bit less. The world uses 30 every year, so it would be a 4-month supply. We would need to find and develop 3 ANWAR every year just to hold our own....

According to projections released yesterday by the Dept. of Energy, ANWR would reduce crude prices by 75 cents/barrel:


I.e., peanuts.

Now I'll post this over in today's Drum Beat....

The total quantity of technically recoverable oil within the entire assessment area is estimated to be between 5.7 and 16.0 billion barrels (95-percent and 5-percent probability range), with a mean value of 10.4 billion barrels. Technically recoverable oil within the ANWR 1002 area (excluding State and Native areas) is estimated to be between 4.3 and 11.8 billion barrels (95- and 5-percent probability range), with a mean value of 7.7 billion barrels (table 1).


This is my first post here at the Oil Drum after trolling for quite some time. I too made this CNBC segment "Must See TV". I then caught the T. Boone segment on Beck and thought what a waste of time the CNBC was. I agree with one of the posters above that it devolved into "How Can I Make A Quick Buck In Chaos Land?"

But here is something that I see very little to no discussion of. The Baron Rothschild reportedly stated that the best time to invest is when "There is blood in the streets." Simply put, when there is chaos in a land, a region, a state, or a market segment that has something of value, that usually drives the price down for a time until the chaos ends and recovery begins and the price of that valuable goes up.

But.....(and this is a very big Fat Lady but) if you are a pretty far seeing person, and many memes are coming together in some fashion of Super Alignment, and you know your market, then you realise that certain valuables (ie OIL) are best purchased now and locked in price for the future because the chaos will be long lasting and counter-intuitively will NOT suppress prices but accelerate them.

What do I mean by a Super Alignment of Memes vis a vis the price of oil? Well consider these....

1: The Peak Oil Meme is now seeping into the mainstream thought collective. Just as it is very hard to turn a huge ship on a dime, you still must make the turn knowing it will eventually respond. The ship is just now showing some signs of turning. And money that is languishling in money market funds, and dwindling real estate, and staganant equities are pouring into the oil market to chase the profits. Most of these folks don't have a clue to the disaster that is coming, but they know enough about dwindling supplies and price increases to know that they need to park some money there in order to make up losses from other investments.

2: The Falling Dollar Meme: With 55 trillion dollars of aggregate U.S. debt and climbing ever higher, with interest rates falling and will fall some more (yes, they will fall some more, because this economy is not built for the high energy prices we have now and the Fed will still be more concerned with greasing the wheels more so than inflation in the short term), this just drives the price of oil higher so that the oil producing economies can make up for their losses when they are being paid by more and more worthless dollars.

3: The year 2014 Meme: I turn 50 in 2014. So what, you say? Well, I'm the last of the Baby Boomers (born in 1964). And although I will have a few years left until I can draw from retirement, the Government states that in 2014, we "officially" go into deficit when it comes to Social Security payments to us old farts. Not that the acutuality has a lot to do technically with the price of oil, but it will serve to further the notice that we are bankrupt as a country and a bankrupt country has an ever increasingly worthless currency. Which feedback loops into Meme #2 above. Also the 2014 Meme serves to dovetail nicely into.....

4: The Land Export Model Meme: This is the real culprit that will forever seal the doom of the smiley-faced, ever optimistic, green-eye shade, "Peak Oil is a Malthusian Conspiracy Theory designed to kill growth" group. (Like Kudlow & Co.) Most of the major exporters of oil, such as Iran, Russia, Venezuela, etc. according to this model, while having oil reserves out to the 2030's +, will have cut their exports to near nothing in the 2018-2025 range because of hoarding for internal use. This knowledge will be common by the 2014 year range which means a further acceleration in the buying up of the last vestiges of anything remotely "cheap" (a very relative word at this point) oil by this time.

5: The Israel 2020 population implosion meme: No matter how you come down on the issue of the right of Palestinians and Jews to the land of Israel, this is a clear fact, Jews are dwindling in numbers vis a vis the population of Palestinians internally and Muslims externally. This is why the Israelis are so desperate to help form a Palestinian state so they can legitimately deny immigration into the new Jewish state boundaries and they can legitamately take action against a new Palestinian state and not just a group of stateless refugees. Blood is in the water and the Muslims smell it and are getting ever more agitated. Hamas in Gaza, Hezbollah in Lebanon, The Muslim Brotherhood in Egypt, etc. How do you spell CHAOS in the 2010's....M I D D L E E A S T! And this of course just helps drive the price of oil up as well.

6: The Chindia Growth Meme: 'Nuff Said!

There could be other memes out there, this is just some that I see all coming togething in a short amount of time that will drive oil to $400+ and $12+ for gasoline during the early to mid 2010's.

Oh yeah....don't forget the odd natural disaster like another Katrina like event, or the Big One in California, or another 9/11 during this time frame. 2009 marks the end of the first 21st century decade. That year will be remembered as the "Awakening" year. For in the 2010's all things old will begin to pass away and something new will be formed. And it may not be good at all. In fact, while being no fan of the Mayan civilization, their prophecy of the world ending on Dec. 21, 2012, may prove to be correct. Certainly by the end of 2012 most of us will have realized that the world that we have known and our father's and grandfather's have known is coming to an end.

But to what?

Google Inc., Chevron Corp. and Goldman Sachs Group Inc. build Mirrors in Desert to Beat Coal With Solar Thermal


I missed the first few minutes but otherwise caught the whole show. It reminded me that this equipment is best used for viewing DVDs. I thought, ‘what a bad production’ and went to bed. After sleeping on it, it settled in; this wasn’t a bad show, it was much worse.

The fact that the term Peak-oil was not used is classic newspeak. The term is actively discredited because the concept illuminates as it leads to more useful understanding; while the concept of supply & demand can be applied to anything. Just like a couple of referrals to a ‘weak’ dollar; whatever that means to a Carl’s Junior public.

Although speculation was disclaimed (so to speak) a couple times, only the informed would pick up on it. In the closing comments of the show, the host refers to speculators as the last word. And this directly after the Secretary of Treasury, Paulson (ex Goldman) highlights supply & demand with no mention of a collapsing dollar.

And that brings me back to this point; supply and demand (or better yet, the affects of peak-oil) have not caused the high oil price – for the most part, to date. It is the collapsing dollar, which is due for another drop in weeks, if not days. Price-hikes due increasingly to constriction of supply, is a barrier coming into view now through diminished exports as Brown has lain down.

But this show was not meant to educate; from the host standing outside yelling, to the human interest tips, to the big names, to anecdotal truths lost in a frantic pace – this show was not intended to ‘ease’ Joe six-pack into peak-oil, it was created and choreographed to obscure. This program is your one stop shopping for America’s Oil Crisis. No need for books or TOD; consummate blame-shifters tell you what you need to know; may as well name it the War on Oil. I kind of like that slogan – because it’s meaningless. The show is further evidence that this train goes into the wall, by design.

Stranger - I like the term War On Oil also - it is less of an oxymoron than War On Terror, but just as meaningless.
There will be many people trying to understand what the news is obscuring. Some of those will be here. I am one of them. After 20 years in computer networks, I can tell when people are putting up a smokescreen around something complex, and all the shows on oil price just scream that. Now I would give anything to understand the real how-it-works of oil purchase. Complexities of options and futures and government subsidies all come together in an investment-uneducated mind, to make me think I will never know what money actually changes hands, and who owns a barrell of oil in reality at any give minute, not just on paper, at every step from field to refinery. Educate us newbies, please! we are sorry you have to go back to kindergarten to explain what money actually changes hands, and who actually owns oil at each step. But a knowledgeable public will do the right thing, I am sure. Thanks for any help.

Please educate? Hey, thanks for the compliment. But the truth is I come to TOD to learn, that’s why I rarely comment. But, as someone stated earlier, this post was about our opinions on TV peak-oil coverage.

There is no site quite like TOD; it’s valuable the way it is and I wouldn’t change its focus. But that focus naturally leaves other perspectives out-of-focus; and two relevant grey areas are the financial system and the main stream media. Peak-oil can’t be separated from these two, when the focus shifts out.

I’m no professional trader or wall-street guru, more of a contrarian Joe six-pack – but I do maintain some subscriptions to financial info and try to comprehend it; The Hat Trick Letter, The Privateer, Zeal and some others (Zeal is worth the subscription price for access to the charts alone). The sense I get from studying the foundations of our current monetary system, is that it’s inherently unsustainable, and now terminal. The sense I get, from those that are experts on the markets, is that the concept of speculators being responsible for $130 oil is laughable. There is manipulation, of course, but effective only short term due to the size of the market.

The complexities of options and futures are beyond my ability to comment; but I do think that in simplest form these inventions have benefited society. It’s the over leveraging, lack of visibility, and corruption that have served forces on the side of destruction.

I used the term, ‘the sense I get’ for a reason. Often when I get a question on peak-oil, the person posing it won’t accept my answer – they often shoot back, ‘why do you think that’ or ‘can you prove that’ or some such thing. I want to say, ‘here, read these three articles by Nate Higgins’ or ‘read these seven articles by Jeffrey Brown’ but I can’t get away with that – so I just try to sum it up. That’s feeling I get with the scope of the Financial System Pillar; there’s a lot to it.

And I think the Media consolidation of the last few decades is a change for the worse. I see it as devolution, not right or left – conservative or liberal, but serving commercial interests. And now commercial interests are merging with government, serving an Authoritarian Business Model. In this model, ‘the public’ are farm animals and have no place in the management of the farm.

Well, I hope this was a good place for these musings, so they do not clutter up the more serious discussions.

Well thanks for replying. I agree about the consolidation of news 'providers'. However it is greatly mitigated by the internet. I have sometimes seen a tv news theme dissolve into fact when major blogs addressed it, and the pundits scrambling for a new slant to put on something real-time. This theme about the price of oil makes me feel like I lost 30 years, literally. I'm sitting here, and they are saying it AGAIN: "We are almost out of oil, it is our fault, and we must conserve. Conserving will solve the problem, that's all we need to know." I'm glad it wasn't true back in 1978, I don't know if it is true now.

I agree with your positive thoughts on the internet, but my optimism in this area is balanced by a sense of risk - much disinformation in this arena too. I think it’s a small percentage of us that use the internet to understand what is going on.

A last comment about the show; it had the same structure as an infommercial. Well, I guess my spell check didn’t like Hagens, no disrespect intended to Nate.