DrumBeat: June 23, 2008

Bitten by the deal that once fed us

If Mr. Obama wins in November and brings his issues - labour and environment standards - to the table, Canada should prepare its own list. At the top should be getting out of the "energy proportionality" straitjacket that mandates that Canada must offer a majority of its oil and gas to the United States, even if Canadians freeze in the dark. Proportionality is "unique in all of the world's treaties," writes Richard Heinberg, a noted California author on energy. In no other developed country are citizens denied first access to their own resources. "Canada has every reason to repudiate the proportionality clause," Mr. Heinberg continues, "unilaterally and immediately."

A legal case against the OPEC cartel: Decades of putting up with OPEC have not reduced oil prices.

As the national average price of gasoline raced toward $4 a gallon and airlines laid off workers by the thousands because of rising jet fuel costs, the US House of Representatives took action: It overwhelmingly passed the Gas Price Relief for Consumers Act of 2008.

The bill would have made it illegal for foreign states "to act collectively" to limit the production or distribution of oil. Put simply, the bill permitted the Justice Department to charge the Organization of the Petroleum Exporting Countries with violating American antitrust laws.

Apache says full gas production in Australia may take six months

SYDNEY (AFP) — Energy company Apache said on Monday it expected Western Australian gas production to be partly restored by mid-August, but that it could take six months for full production to resume after a blast at its Varanus Island plant.

Oil prices: No cause for panic

The US Department of Energy explains, “The national system of energy intensity indicators captures the changes in intensity due to efficiency improvements relative to the influence of other explanatory factors unrelated to efficiency improvement. One example of such an ‘other explanatory factor’ is the shift of economic activity out of the industrial sector and manufacturing, that use large amounts of energy per unit of output, into service industries that use only very small amounts of energy.”

In other words, energy costs less nowadays to produce one dollar GDP compared to the 1970s and this is due to the fact that 70 percent of the total activity in the US economy comes from the non-goods producing sectors such as retail trade, wholesale trade and services sector, which account for 55 percent of the United States economy.

Planning ahead for an L.L. Bean winter

Just several days into summer, Americans are already worrying about winter and the much higher fuel bills they will pay, up perhaps 50 percent to 60 percent over last winter.

Americans learn to sip, not guzzle, without a carbon tax

"Sure is hot in here," I repeat.

"Sorry, no air conditioning," responds my driver, a stoic sort from Vietnam who isn't breaking a bead of sweat in the swelter. "Gas prices too high, now. Air conditioner uses gas. So I open windows, okay?"

I've noticed lots of San Franciscans using the same low-tech AC these days. Gas has hit almost $5 a gallon (about $1.30 a litre) here, a U.S. record. Yikes, it's almost as high as Canada. Conserving fuel -- or at least conserving the greenbacks it takes to guzzle gas -- is suddenly at the top of the American mind.

The five-day workweek isn't written in stone

Kudos are in order for the most imaginative proposed idea to enhance county government in years. With significant enthusiasm, I relish reviewing a four-day workweek plan for county government at the board's next meeting.

The Money Squeeze: Colleges look at curbing student commute

Katoya Palmer missed a day of class just about every week last spring but not because she was too busy or too lazy.

She missed class because the price of gas -- $73 last time she stopped to fill up her Ford Explorer -- is making it awfully hard for the Kent resident to justify her hourlong commute to Bellevue Community College.

Untapped weapon in energy crisis

MY car can get 55 miles to the gallon, sort of.

Is it a hybrid? Something experimental? Nope. It's a stock 2001 Nissan Sentra with 67,000 miles on it.

How can this be? The answer is simple, and thousands of people use it. It's telecommuting.

Adverts urge world to axe CO2 to 1980s levels

OSLO (Reuters) - The world should cut the level of carbon dioxide in the atmosphere to below that of 20 years ago, more deeply than most government plans, to avoid the worst of climate change, a group of 150 advocates said on Monday.

"We've gone too far -- in a dangerous direction," scientists, politicians, business leaders and others said in full-page advertisements in the Financial Times, the New York Times, the International Herald Tribune and two Swedish dailies.

The bright side to high oil prices

There’s an interesting little piece by Sumit Paul-Choudhury in this week’s New Scientist. He talks about American journalist Daniel Gross’s 2007 book, Pop! Why Bubbles are Great for the Economy. In the book, Gross argues that bubbles aren’t necessarily a bad thing. They leave financial carnage, but they create the infrastructure of the future. For example, the internet boom and bust left us with a global fibre-optic network that would never have been built without the irrational exuberance of the dot.com era.

Paul-Choudhury quotes physicist-turned-risk specialist Didier Sornette’s argument that “it is only during the reckless abandon of bubbles that individuals and companies take the foolhardy risks needed to develop technologies with large social impacts but low financial returns.”

In other words, it takes ridiculously high prices to persuade individuals to take the ridiculously large risks needed to make big changes in the way we do things.

Is 'Peak Oil' Already Affecting the Stock Market?

If I were asked to recommend an energy advisory team for the next President I’d start with Robert Hirsch. Hirsch is a defense planning expert who has headed up major consulting assignments for the Defense Department among other clients and in 2005 he published a major study of the impacts and potential mitigation of Peak Oil. It famously forecast that a successful transition from oil dependency would need to start 20 years before oil production peaked.

Who wants oil prices to fall?

On one side, the oil producers cartel Opec yells that there's plenty of the black stuff available and the price is being forced up by "speculators".

On the other side, the big oil consuming countries shout back that the real problem is supplies have failed to keep up with demand - so would Opec kindly start producing more.

In fact, the two arguments are both partially true.

What works?

There is a finite amount of available fossil fuels and even if we find more in Alaska or off our coast, it will eventually run out. No one knows for sure when that will happen, but some energy experts believe we have reached the point where the world has already used the easy-to-find and retrieve petroleum. They call the problem peak oil.

Even people who don’t believe the global warming argument for turning away from fossil fuels can’t ignore the reality of peak oil.

'Big three' look at big losses

The individuals who bought those gas-guzzlers have been pawns in a big marketing game. GM, Ford and Chrysler knew a good thing by positioning the large vehicles as status symbols with big price tags and profits over $10,000 per unit. They co-opted the American and Canadian government CAFE standards to allow large vehicles and SUVs a pass on fuel economy. The big three automakers are now fighting a wintertime retreat from Moscow. They are getting massacred by Honda and Toyota among others, who have had a better strategic vision over the years.

Bring back Zeppelins and create an air way to heaven

THE best thing about the peak oil apocalypse, which I predicted in The Australian last month (Bleak at the peak but the slick shall survive), will be the return of dirigible travel.

Oil rises despite Saudi output pledge

VIENNA, Austria - Traders again shrugged off a pledge by Saudi Arabia to increase its oil production if needed and oil prices rose Monday, with the focus on disruptions to Nigerian supply and heightened Middle East tensions.

...Saudi Arabia's pledge fell far short of U.S. hopes for a specific increase. The United States and other nations argue that oil production has not kept up with increasing demand, especially from China, India and the Middle East. But Saudi Arabia and other OPEC countries say there is no shortage of oil and instead blame financial speculation and the falling U.S. dollar.

Analysts said the meeting helped provide some clarity as to the size of spare OPEC capacity available. Saudi Arabia said it is willing to invest to boost its spare oil production capacity above the current 12.5 million barrels per day planned for the end of 2009 — if the market requires it.

Jeddah deepens oil price dialogue, but no quick fix

JEDDAH, Saudi Arabia (Reuters) - World energy powers embarked on a new level of dialogue to try to rein in runaway oil prices at an emergency meeting in this Red Sea city, but were unable to come up with a quick fix.

Host Saudi Arabia vowed to pump still more oil in response to consumer countries' requests, but said that alone would not be enough to calm a market driven to a record close to $140 a barrel last week by an array of factors.

Nigeria Oil Output At Lowest In 25 Yrs - Official

JEDDAH, Saudi Arabia -(Dow Jones)- Nigeria is pumping oil at its lowest level in 25 years, following militant rebel attacks on facilities in recent days operated by Royal Dutch Shell PLC and Chevron Corp., a senior Nigerian oil official said Sunday.

Nigeria, which has in recent months been overtaken by Angola as Africa's biggest oil producer, is now estimated to be producing oil at between 1.2 million and 1.5 million barrels a day, the oil official told Dow Jones Newswires, the lowest level since around 1983.

"Things are very bad now in Nigeria," he said on the sidelines of a major oil summit here between producers and consumers.

Nigeria militant group offers cease-fire

LAGOS, Nigeria - Nigeria's main militant group declared a unilateral cease-fire Sunday, saying elders in the restive southern region had asked the fighters to allow peace efforts to go ahead.

The Movement for the Emancipation of the Niger Delta said in a statement that it would halt attacks starting at midnight Tuesday.

World has enough oil supplies for 'many decades': Nuaimi

JEDDAH, Saudi Arabia (AFP) - Saudi Oil Minister Ali al-Nuaimi said on Sunday the world has enough crude to last for "many decades" and that his country will invest massively to be able to produce 15 million barrels a day.

"The world has enough petroleum reserves, both conventional and non-conventional, to meet oil demand for many, many decades to come," Nuaimi told a summit in Jeddah of top consumers and producers.

Saudi proposes oil-for-poor initiatives, vows loans

JEDDAH, Saudi Arabia (Reuters) - The world's largest oil exporter Saudi Arabia proposed on Sunday creating a $1 billion OPEC fund and offered $500 million in Saudi soft loans to help poor countries cope with high oil prices.

Speaking at the opening of a meeting of world oil consumers and producers, King Abdullah also urged the creation of what he described as an international energy-for-the poor initiative and called on the World Bank to arrange a meeting to discuss it.

"I call for the launch of an energy-for-the-poor initiative, the purpose of which is to enable developing countries to face the rising cost of energy," he said.

Aramco sets Khursaniyah date

Saudi Aramco is set to bring the Khursaniyah oilfield project - capable of pumping 500,000 barrels per day - on stream in August, Amin Nasser, the senior vice president of exploration and producution at the Saudi Arabian company, said today.

Russia's Gazprom CEO opposed to "Gas OPEC"-report

MOSCOW (Reuters) - The head of Russian gas giant Gazprom said on Monday an OPEC-style gas charter is not feasible as its oil equivalent is failing in its original task of regulating prices.

"This organisation no longer has any real influence on the world oil market. Lately OPEC has not made one decision that could actually affect competition," Alexei Miller told the weekly magazine Itogi in an interview.

No blood for ... er ... um ...

You'd think the Times might have slapped some kind of "we wuz wrong" label on the piece. I mean, remember when the mainstream media, the Times included, seconded the idea that Bush's invasion, whatever it was about - weapons of mass destruction or terrorism or liberation or democracy or bad dictators or ... well, no matter - you could be sure of one thing: it wasn't about oil. "Oil" wasn't a word worth including in serious reporting on the invasion and its aftermath, not even after it turned out that American troops entering Baghdad guarded only the Oil and Interior Ministries, while the rest of the city was looted. Even then - and ever after - the idea that the Bush administration might have the slightest urge to control Iraqi oil (or the flow of Middle Eastern oil via a well-garrisoned Iraq) wasn't worth spending a few paragraphs of valuable newsprint on.

Caltex chief says Australians must use less fuel

The head of Australia's largest petrol retailer has suggested motorists use less fuel, saying it is one way to reign in skyrocketing petrol prices.

Caltex chief, Des King, says all motorists can do now is reduce their demand.

Honolulu Advertiser

"I've been in this business for 22 years and I've never seen anything like this. ... They have dropped like rocks," Caliri said.

"Three years ago, people who didn't even need a truck were buying trucks. Now they're getting rid of them."

Americans save on gas in Mexico, but costs may hit later

Mexican gas is made with a different formula -- containing more sulfur -- which could hurt your car in the long run, according to Stephen Mazor with AAA's Automotive Research Center.

That fuel mixture can ruin the emission control equipment on American cars and cause them to fail emissions tests.

Beijing to take half of all government cars off the road

BEIJING (AP) — Beijing's city government on Monday said it ordered half its cars off the road ahead of the Olympics in an effort to clean up the air for the games and save energy.

Half of all government and Communist Party cars will not be used from Monday until July 19, the city said in a notice on its website.

Underground Coal Gasification (UCG) Potential Eases Peak-Coal Fear

At least 20 nations including the UK, Germany and Japan have already passed peak coal. Some major coal-producing nations have a relatively young coal industry that is only in the beginning of their production curves.

Some analysts are pessimistic about future world coal production, while strong arguments are also made that world coal resources and production potential are underestimated. Underground coal gasification (UCG) can remove the uncertainty.

Are we really ready for this financial storm?

What has spooked them is a complex of factors, of which the doubling of the price of oil is only the most obvious. The oil spike is viewed as a consequence of low interest rates and the decline of the dollar, which has ignited a speculative boom in commodity prices, similar to the dot.com bubble which burst in 2000 and the real estate bubble which has been imploding since 2006. This is a highly unstable situation. It has arisen just as inflation has returned with a vengeance to Asian countries such as China and India, the countries which manufacture most of what we buy. Inflation in Vietnam is 25%.

Obama Camp Closely Linked With Ethanol

Mr. Obama is running as a reformer who is seeking to reduce the influence of special interests. But like any other politician, he has powerful constituencies that help shape his views. And when it comes to domestic ethanol, almost all of which is made from corn, he also has advisers and prominent supporters with close ties to the industry at a time when energy policy is a point of sharp contrast between the parties and their presidential candidates.

McCain proposes $300M prize for advanced auto battery

PHOENIX — John McCain hopes to solve the country's energy crisis with cold hard cash.

The Republican presidential nominee-in-waiting is proposing a $300 million government prize to whomever can develop an automobile battery that far surpasses existing technology.

Time to cut the knot: Security and greenness are two separate goals

The common ground between those who want to import less energy and those who want to pollute less turns out to be quite small. Witness the fuss about corn- and wheat-based ethanol, which are great for farmers, but of dubious benefit to the environment and of serious detriment to the poor, who find themselves paying more for their food. As these drawbacks have become apparent, the political consensus in Europe and America in favour of ever-bigger biofuel mandates has evaporated.

The divide is even wider in the case of coal, the foulest of fuels as far as greens are concerned, but one of the fairest in the eyes of energy-security types.

“Mountains of the Moon” Glacier Melting

Uganda’s fabled Rwenzori icefield may disappear in decades because of climate change, a new study reports. A British-Ugandan team says an increase in air temperature over the last forty years has contributed to a substantial reduction in glacial cover.

James Hansen: Prosecute oil companies, top scientist says

James Hansen, the leading climate change scientist who made a ground-breaking speech about global warming exactly 20 years ago, will today reprise his seminal address when he calls for fuel companies to be tried for crimes against humanity.

A great video, very early this morning by Melissa Francis on CNBC Ms. Francis was, in my opinion, completely snowed by the Saudis. Ms. Francis said:

The price is not high because of supply, that's for sure. Saudi Arabia threw absolutely everything it had at the market from every angle. They said, “look we are going to give you 200 thousand barrels a day right away. We are also going to raise the capacity of what we can produce by the end of next year another ten percent to 12.5 million barrels a day.” That’s more oil, more capacity, than they have ever had in the past. Then they went on to say “After that we can go to 15 million barrels a day.” They outlined for us which fields they are talking about, where the oil is coming from so people couldn’t say “Oh it’s too big, I don’t know, is that you know peak oil, is that field dry?” No, they outlined for us where it’s coming from and said “it’s there, we don’t know for sure we are going to have the customers but we are going to build the infrastructure and we are ready to bring it to the market if you want it.”

The 12.5, I have to correct, is coming for sure by the end of next year. Now I talked to the Saudi Oil minister. They are putting 2 million barrels a day of refining capacity around the world right now for heavy sour…..
He said their biggest fear right now is demand destruction.

I think the Saudis are producing every drop they possibly can and are making great plans to produce more. I, for one, do not believe they will be producing 12.5 million barrels per day by the end of next year, or even have the capacity to produce that. But time will tell.

All that being said however, it looks for all the world to me that the Saudis realize what a damn mess the world is in, concerning the supply of oil on the market. And, they are doing what they can to help. It is just that they can’t do very much. I believe their promises are a lot bigger than what they can actually deliver. However I may be wrong.

Ron Patterson

Some interesting comments on CNBC at about 8:25 Central time--lots of Shocked! Shocked! realizations that the Saudis have very little ability to significantly increase production, especially light/sweet.

From May, 2007 to May, 2008, oil prices increased at about 6% per month. In June, we are on track for a 6% range increase:

$125 + 6% ($8) = $133

For the time being at least, a price increase of 6% per month appears necessary to balance demand against declining net oil exports. What is happening now is a continuation of what started in 2005 in poorer countries: a smaller number of consumers paying a higher unit price for a smaller volume. It's just that forced energy conservation has moved up the food chain, and it is now having widespread effects in wealthier countries.

I expect to continue to see a parallel 6%(+) per month rate of increase in delusional thinking.

Regarding post-peak delusional thinking by former swing producers, the following comment was in response to a question from me, in 2005:

Texas has enough oil supplies for 'many decades': Tinker

(Dallas, Texas) Texas State Geologist Scott Tinker said, in 2005, that while Texas may not be able to match its peak production rate, it could, with the use of improved technology, significantly increase its production.

Baghdad Bob has taken up residence in Saudi Arabia. Or is he dressed in drag and working for CNBC?

The markets, apparently, see this as so much noise. But wasn't most of the world, excluding the U.S., taking action on global warming? And how does increased supply and consumption fit into that overall scheme? Only if the intent is to avoid substituting coal for oil.

How predictable that the world's "leaders" would panic at the reality of higher prices and lower supply. As usual, they are subsituting the magic of wishful thinking for a real energy policy.

It is past time to set a floor on oil; the longer reality is avoided, the worse things are going to be.

Obama is coming to the rescue, however, with his support of ethanol. We'll worry about food later, maybe sometime next week.

The big story this year (with some important exceptions, still largely ignored in the MSM) is the ongoing export decline from Russia, Norway, Mexico and Venezuela--key nearby sources of imported oil for Europe and the US respectively.

I estimate that Mexico's net oil exports fell from about 1.4 mbpd in 9/07 to about 1.1 mbpd in 5/08. At this rate, they would be at zero in about three years (from 9/07), the Fall of 2010. At half this rate, they might make it to the Fall of 2013.

BTW, Mexico might be an interesting model for another top 10 net oil exporter that is highly dependent on one field, Saudi Arabia. It appears that the big decline in Mexican production kicked in four years after their final peak, which would mean 2009 for Saudi Arabia.

The real kicker is that after they reach zero exports, they quickly become a net importer, which then increases the competition for the globally shrinking supply of available exports.


Like the UK & Indonesia

I used the ELM's 28% per year and Matt Simmon's 8% per year to current world exports. Does this seem reasonable?

Also estimated is the oil deficit from export decline since 2005 compared to the deficit from the 1973 Oil Embargo. Losses from the Embargo likely over stated, are based on 4 mbpd for the entire period of the Embargo. Even if 73 Embargo is over stated, deficit for the last 3 years are 3 times greater than those of the Embargo.

Our middle case is that the top five net oil exporters (about half of world net oil exports) collectively approach zero net oil exports around 2031. My guess is that total world net oil exports in 2031 will be down by at least 75% from their 2005 peak.

Any predictions for when we hit peak delusion?

Evidence suggests the more delusion is consumed internally, the more is exported, clearly physical supplies remain abundant.

"I look at it this way... For centuries now, man has done everything he can to destroy, defile, and interfere with nature: clear-cutting forests, strip-mining mountains, poisoning the atmosphere, over-fishing the oceans, polluting the rivers and lakes, destroying wetlands and aquifers... so when nature strikes back, and smacks him on the head and kicks him in the nuts, I enjoy that. I have absolutely no sympathy for human beings whatsoever. None. And no matter what kind of problem humans are facing, whether it's natural or man-made, I always hope it gets worse." George Carlin (May 12, 1937 – June 22, 2008)

If only the ones doing the defiling and those receiving retribution from nature were the same, I would agree with this statement. Unfortunately, that's not how it works.

Those who have gotten rich raping the planet will be the most able to afford to protect themselves from it's counter-attack.

Peak delusion? I think it has peaked. What was it Dylan Ratigan said on CNBC last Fri. when the markets were plunging? Something like "Oh ... about the Saudi oil meeting and Bernanke meeting at the Fed? It doesn't matter who's meeting with who. Nothing changes the (bear market mentality)."

Dylan is looking a big depressed these days. He's a quick study I think. He and a number of the other CNBC staff are no longer as deluded as they once were.

Peak Delusion has a direct relationship with Peak I Told Ya So's. About the time we are tired of the told ya so's, the delusionists are tired of hearing it.

Hi WT,

That would be a hard act to follow...here's hoping you are wrong :P

July would be avg 141 (+8)

Aug would be avg 149.50 (+8.50).


However it still would be only 21 cents a cup then, for possibly the most precious substance in the history of mankind. Not smarter than yeast definitely.

So if we continue what PeakTO and WT have written :-

Jul = $141.00
Aug = $149.46
Sep = $158.42
Oct = $167.93
Nov = $178.00
Dec = $188.68
Jan = $200.00
Feb = $212.01
Mar = $224.73
Apr = $238.21
May = $252.50
Jun = $267.66
Jul = $283.71

Yikes x 2 !!!

If you use the 70 rule then 6% means oil will double in price every year (assuming %6 holds true)

Those figures are averages for each month - if you watch the daily data it fluctuates up and down in a range - so, which month do we see $150 oil. $150 Tapis in June?

If the price goes up by 6% every month, you will see $150 oil by August (Sep contract).

Hello Suyog,

I would expect I-NPK pricing to rise just as fast, or even faster, too. It depends on how much total [and depleting] FFs are dedicated to this very long and complex global supply chain.

Remember: the depleting P & K ores [just like oil-- first guano, then on to the next lowest fruit!], the depleting sour natgas & sour crude [cheapest sulfur source], and the Haber-Bosch nitrogen are essentially free--it is just the huge energy requirements and total global infrastructure that determine the supply, and obviously the demand for food won't shrink as long as the population is still increasing at 70 million per year.

Has anybody found that Ghawar-sized batcave full of guano yet? Oh wait, ..I forgot.. they are experiencing dieoff from white-nose fungus. I suggest the big ramping of O-NPK recycling instead, because I don't see people everywhere racing to build bat shelters, and making bat biologists the highest paid people on the planet.

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

Any idea what carrying capacity/crop yields in the U.S. would be without I-NPK? How much food could we make using manure/rotation etc.?

What would be the U.S. carrying capacity using only organic methods?

Hello Consumer,

Thxs for responding. I am pressed for time, so no supporting links.

No expertise here, but what I have read seems to indicate that commercial harvest yields would drop by more than 50% instantly [if no O-NPK is recycled back to the field], and the subsequent additional crop rotation to nitrogen-fixing plants [to be totally plowed under] would reduce the grains available by an additional significant percentage [20% more?]. Good luck trying to stay above a Liebig Minimum.

If O-NPK is used abundantly & immediately: the commercial yield is still expected to initially decline, but then as the topsoil becomes organic over time, healthy with micro-organisms, and full of mulch--the yields are equal or better than using I-NPK. I recall that the conversion process takes about 5 years or more [Rhodale Institute?].

Lots of people can starve during that 5 year conversion process. :(

You might want to check out rice. Seems I read that it gives back almost every nutrient taken. One of the reasons that the Asians can plant and grow it so well with little commercial NPK inputs.

As I drove back from Oklahoma today I noticed a huge increase in rice plantings in the bootheel of Missouri. I thought that NE Arkansas was the big guys on rice but now it must have qualities to make it able to compete favorably with the normal corn-wheat-soybean mantra.

Also once you plane and setup your ground for rice I think you are pretty much locked into it and will then go with just that crop on that prepared acreage.

Myself I love rice and even eat it for breakfast with milk,butter and sugar. With soysauce the rest of the time or with Beans(ala 'hopping john')


The problem with rice is water. It requires huge amounts of water to grow, and water shortages are actually causing many Asian farmers to switch away from it.

Most of the water used in commercial rice growing is to control weeds. Methods are being developed to do away with the flooding stage http://www.sciencedaily.com/releases/2007/10/071014202450.htm. I discovered this when I looked into the possibility of growing a small rice field on my property. The instructions from the seed company in which I located rice seeds: http://www.organicaseed.com/rice.html

Have you tried growing any rice? I, too, have been thinking about growing some. I recently read an article in the NY Times about SRI (System of Rice Intensification)promoted by Dr. Uphoff of Cornell. Have you heard much about this? I would love to be able to grow some basmati rice in my backyard.

I think it depends on what kind of rice you are growing. Lowland rice needs flooded paddies while upland rice can be grown on dry ground.

Apparently with lowland rice the water isn't just for weed control. The rice plant needs it to grow.

For innovative techniques for rice growing, check this out:


This is strange. I replied to bruce's post when there was no replies. But Now it looks like my reply is attached to sandiego's post.

This must be a bug.

Also, I was wrong in my post, rice doesn't need the water to grow, but that type of cultivation has the highest yields so is the most common. Sorry bout that.

Well, looks like its formated correctly when I look at the whole db. But if I just look at the subthread its formatted incorrectly.


My girlfriend is from Issan (Northeast Thailand) and has been growing rice since before she could walk. She tells me that people do grow some varieties of rice with little water - like sticky rice, red rice and black rice. She says that often they don't grow that rice due to insects and birds which are much more of a problem than when the water is deep. Also there is a real problem with seed. Over the years planters have stopped collecting seed and just planted the cheaper hybrids. The old seed varieties are only maintained by a few people and for most growers it is difficult to get nowadays.

Hi Bob,

An idea/realization hit me last week, and I've been waiting to run it by you. It appears to me that we already have a system that centrally collects human waste streams--Sewage Treatment Plants, and that with some modification they could collect the nutrients they try so hard to wash out of the water they're suspended in. Are there any Waste Management engineers reading TOD?

Whatayathink Bob?

They are already doing this. Last week I watched the Fertilizer episode of "Modern Marvels" and there are sewage plants that do this. They separate the solids, add some bacteria, let it mulch, and sell it as fertilizer.

Disclosure: I am not Bob.

But there is a problem with your idea. The stuff that goes down our drains is not just bodily excreta. There are all kinds of household chemicals, heavy metals, pharmeceuticals, soaps/shampoos/cosmetics. All kinds of lovely bioactive estrogenic crap. Etc.

I would never put anything from a sewage treatment plant on my land, period. We're just not set up for it.

never put anything from a sewage treatment plant on my land

That used to be Milwaukee's Milorginate recommendation - do not use on food crop.
Now they say its OK. Your mileage will vary.

In addition, you are adding energy to the process in the form of:

1) Processed drinkable water moved to your home
2) moving water+waste to processing
3) handling the water+waste - where eventually you have to allow the material to settle out
4) de-watering the settled out matter

Now, it used to be that man handled their own waste via an outhouse. Today it could be done with say 2 machines like the naturesmill. Or other methods documented in the book on humanure.

Yeah, I thought about all that other crap as I was writing, and afterwards remembered the book Toxic Sludge is Good For You. Oh well, I was trying to come up with a use for a system already in place. I was thinking about the mandating of composting toilets, and how it would be easier to use the system already in place. Sigh....

"Sigh" is right, karlof1. That's my take on a lot of things :-)

We are just not set up for real recycling, either of human waste or industrial waste or consumer waste. The fact that I'm even calling it waste is revealing.

I'm thinking that real recycling has to be designed in right at the start, right from the, um, manufacturing stage.

The notion of closing that circle is the right idea, but we're just not set up for it...

Yep. This should be another Manhattan Project sized push, but Alas! Pooh and sewerage isn't as exciting to think and talk about as cars :)

Hello Bob,

I'm sure you saw this article about phosphorus consumption and the potential troubles ahead. Although the topic is out of most peoples vision, it seems certain to have large influence on our global survivability for the future. I suggest you continue your efforts to bring better understanding of this topic to the masses.

It looks like the average WTI spot price for the first three weeks of June was around $134.

It looks like retail gasoline prices are currently about one dollar per gallon more than the spot price of crude per gallon. So, at $284 per barrel, we would presumably see gasoline prices of about $7.80 per gallon, which is less than the current price in Europe. But consider what an oil price increase like this would do to food prices.

Have I mentioned ELP in the last 30 seconds?

ELP Plan (April, 2007)

Expect to see more stories like the one from Circuit City last year. From the ELP article:

ELP: Economize

For some time, I have suggested a thought experiment. Assume that your income dropped by 50%. How would you change your lifestyle?

Many employees of Circuit City don’t have to imagine such a scenario. Many higher paid employees at Circuit City have been fired and then been told that they are welcome to apply for their old jobs, subject to about a 50% pay cut.

In my opinion, the unfortunate new reality is that we are going to see a growing labor surplus--against the backdrop of deflation in the auto/housing/finance sectors and inflation in food and energy prices. By reducing your expenses now, while you can do it voluntarily, you will at least be better prepared for whatever the future may bring.

we are going to see a growing labor surplus

Agreed. Here in the West we are moving from a world of cheap resources and expensive labor to one of expensive resources and cheap labor.

In the East they are moving from cheap resources and cheap labor to expensive resources and even cheaper labor.

Either way, we need to reconstruct our economy to minimize the capital required for projects and maximize the people required. Right now we are willing to spend millions more to purchase highly advanced machinery that takes people out of the equation. This will no longer work going forward because capital will become scarce and it will be in our collective interest to employ as many people as possible.


For the time being anyway, here in Western Canada we can't get enough workers. Of course, we don't need many senior Circuit City people, but there are continuous job fairs and recruitment events. (And that action by the company sucks for many reasons. So tell me folks, how is the American Dream comin' along these days?)

Will the vastly unemployed, fiat currency deprived (or over inflated) Americans become our Mexicans? Ohhh, this doesn't go over too well in the land of the free and the home of the brave (on credit mind you). But think about it, think your reaction to the insinuation and the possibilities?

That's the part that hurts. Now Peak Oil is starting to get a visceral feel.

Circuit City may not be the best example. When they did that they discovered that some of those highly paid people had earned their raises. Those were the ones who didn't have to take the pay cut. CC took a big profit hit, followed by a big stock price hit.

From Drudge:


2,500 people line street in Milwaukee for food vouchers; crowd becomes unruly...

An oil well is a hole in the ground owned by a liar...and, it doesn't matter what nationality the hole is.

Sir, I am personally offended by what you have posted. I will expect an apology.

I would be interested to hear your opinion of this article, Ron. I especially like the part where the Fed passed regulation to 'allow CITI to take possession of crude aboard tankers...for the benefit of the public good'...and, would it not be interesting to find out why those tankers loaded with Iranian crude are sitting around in the Persian Gulf when oil is in such short supply world wide? Link at bottom. This is a long read and not for those with short attention spans...nitwits can simply click the DOWN ARROW.

...snip...'Let’s say the CFTC was not a compromised regulator, was not an audition stage and revolving door for million dollar jobs in the (commodities) industry it regulates. Let’s say it genuinely wanted to report back to Congress on just how big a player Citigroup is in the oil markets. According to a February 22, 2008 filing with the Securities and Exchange Commission (SEC), Citigroup has over 2,000 principal subsidiaries (meaning it really has more but it’s not naming them). Of these, a significant number are secret offshore entities where records are unavailable to regulators. (For a mind boggling look at this sprawling octopus click here: http://www.sec.gov/ )

So the CFTC can’t get its hands on all records and even in jurisdictions where it can, it first has to know under what names, out of a possible 2,000, Citigroup is trading oil and then aggregate the positions.'...snip...

'Next comes what can only be described as an act of insanity on the part of the Federal Reserve. After allowing for the repeal in 1999 of the depression era investor protection legislation known as the Glass-Steagall Act in order to let Citigroup house retail bank deposits, investment banking, insurance, stock brokerage and speculative proprietary trading under one roof (the perfect storm that intensified the Great Depression) the Federal Reserve decided on October 2, 2003 that Citi wasn’t scary enough. It needed to allow this company that had already been named in hundreds of lawsuits for securities frauds and manipulations and could not remotely manage itself as a financial firm to ramp up its oil trading business by allowing it to take possession of crude oil on tankers because it would “reasonably be expected to produce benefits to the public.” Here are excerpts from the Fed’s release suggesting the expansive plans Citi had in the oil storage and transport business'...snip...


I guess the question is quantitative -- how many spare tankers are there, and how much oil could CITI take possession of? Enough to corner the market? Or is this just conspiracy delusion again?

Sure, this is just 'conspiracy delusion again.' Just like the Enron manipulation of energy prices in California was a conspiracy theory. Did you bother to read the link?

...snip...'Combing through government archives, the first noteworthy appearance of Phibro occurs on April 6, 2001, when the Wall Street law firm of Sullivan & Cromwell sent a letter to the Commodity Futures Trading Commission (CFTC), the Federal regulator of oil and other commodity trading, acknowledging that it was representing “the Energy Group.” The letter was noteworthy because it delineated just who had teamed up to grease the oil rigging in Washington: namely, two investment banks (Goldman Sachs and Morgan Stanley); a house of cards that would later collapse (Enron); a proprietary trading firm inside a Frankenbank (Phibro inside Citigroup); and two real energy firms (BP Amoco and Koch Industries).

What the Energy Group had long lobbied for and finally received from its Federal regulator was the breathtaking ability to trade oil contracts and oil derivatives secretly in the over- the-counter (OTC) market, thus avoiding the scrutiny of regulated commodity exchanges, their CFTC regulator, and Congress. The April 6, 2001 letter was essentially to say thanks and interpret the new rules as favorably as possible for the Energy Group.

The change in the law occurred via the Commodity Futures Modernization Act of 2000 (CFMA) and is called the Enron Loophole. (Since Enron’s trading room went belly up along with the company, and Phibro is still trading oil secretly all over the world, it should perhaps now be called the Phibro Loophole.)

What the CFTC also granted the big Wall Street trading firms was a license to sneak under the radar by using computer terminals located in the U.S. while trading oil on foreign exchanges like the Intercontinental Exchange (ICE) located in London but owned by an Atlanta, Georgia outfit that was funded and launched by Wall Street firms and big oil.'...snip...


Yes, I read the link. When it first appeared, even, since I read CounterPunch regularly. My question was mainly rhetorical -- I know nothing about commodity trading except at a very theoretical level. And I am inclined to believe the CP line.

BTW, I gave you a greenie for your post.

Thanks for reading the post NLNG. I am not using the greenies but it was a nice gesture. Thanks.

I indeed read the story (twice), and it sure looks like conspiracy delusion to me. There are ZERO facts in the story that have anything to do with energy manipulation. The author goes to great lengths to make Phibro sound scary, but never associates them or CITI with much of anything, or than trading energy (though she archly points out that they refer to themselves as an "energy trading corporation", just like Enron did .... wink, wink, nudge, nudge).

The author seems to believe that energy trading is the same as energy manipulation, and that OTC trading (the "Enron loophole") is somehow proof. Other than that, we learn that Phibro was part of a failed oil venture years ago, and that they now trade oil (oh, and that they pay their CEO a lot). That makes them a "juggernaut", despite only providing 2 billion to CITI. How much was Enron making trading only in California, compared to what Phibro is making manipulating the entire world? 2 billion? Sheesh. Hedge funds are making more than that with exchange-traded oil futures.

If you're going to manipulate the oil market, you have take production off the market. Enron did that in CA. However, the world is not CA. To move oil prices as much as they have moved, you'd have to take whole percentage points off production. 1% of production is about 750,000 barrels of oil per DAY. To move prices and keep them there, you'd have to take at least that much offline every day for the past 6-8 months. That works out to be 130-150 million barrels of oil CITI would have to be sequestering somewhere. That's several times the oil at Cushing, OK.

Where's the evidence of this? Not surprisingly, the author gives none. According to standard conspiracy theory format, the author recites a bunch of mundane facts about the company, points out that the company is doing a lot in secret, and then invokes Enron repeatedly.

Hey, I'm all for closing the "Enron loophole". Just don't expect it to have any effect on oil prices.

From my post up the thread:

I expect to continue to see a parallel 6%(+) per month rate of increase in delusional thinking.

BTW, oil prices went up about 1,000% from 1972 to 1980, without the benefit of the "Enron Loophole."

I think that conventional wisdom is wrong. I think that the physical market for crude oil is driving the paper market higher. This is basically a "Shoot the messenger" effort.


The markets are not paying for storage.

Farmers encounter this all the time.

Mac, better go read the link. If CITI is taking possession of oil aboard tankers....

'Citigroup also has represented that it will have in place specific policies and procedures for the storage of oil… '


'In addition to the secretive Phibro oil trading unit, Citi has formed Citigroup Energy and moved it to Houston. In a help wanted ad placed in Canada it described itself as follows: “Citigroup Energy is a global energy trading, marketing and risk management company based in Houston with offices in Calgary, New York, London, and Singapore. OUR GOAL IS TO BECOME THE PREMIER GLOBAL ENERGY COMMODITIES MARKETING AND TRADING ORGANIZATION. cURRENTLY OUR CAPABILITIES INCLUDE TRADING AND MARKETING DERIVATIVES/STRUCTURED PRODUCTS IN POWER, NATURAL GAS, CRUDE AND CRUDE AND CRUDE PRODUCTS" (caps mine)

Enron also called itself the “premier” energy trading organization. Apparently impressed with that model, Citigroup Energy has hired a significant number of former Enron traders.'


If Citibank starts storing huge amounts of oil anywhere, the market will know about it, just as the market knows about the Iranian tankers, and the price will take a dive. Nothing scares an oil trader more than large amounts of inventory--it doesn't matter who owns it.

Yeah Moe, you small time traders are privy to all the rumors that the talking heads and blogs can dish out. You are really well informed.

...and Enron was doing fine till it wasn't...

Speculators can store oil by hiring tankers. One supertanker can hold 2 million barrels. They fill the tankers and park them by refineries. When they think prices have peaked they steer them in to the refinery for unloading.

I think that you may well have hit upon a fantastic scheme for turning a large fortune into a very small one.

Supertankers aren't exactly cheap to hire and there are a whole host of other fees and costs involved in parking a supertanker next door to a refinery that might, just might, say, "no ta 'guv, we've got another delivery scheduled for 3 days time for $10 million less, but we know a bloke, for a small fee of course, in Rotterdam who might do you a deal."

Speculators can store oil by hiring tankers. One supertanker can hold 2 million barrels. They fill the tankers and park them by refineries. When they think prices have peaked they steer them in to the refinery for unloading.

Wow, what a super dumb plan. I have a much better plan. They buy futures contracts on 2 million barrels of crude. When they think prices have peaked they sell the contracts. So simple and they save all that hassle of renting tankers and paying to park them.

Of course they must be correct in guessing that the price is going up. Otherwise they lose money. But they do not lose nearly as much as if they had rented those damn tankers to store the oil.

Ron Patterson

The clever thing is that by taking millions of barrels of oil off the market it forces prices up. In he last crisis of 1981 there were several tankers parked outside a refinery in New York watching each other like hawks.

The price of oil trebled in three months - it made sense to leave the tankers at sea while prices were increasing that rapidly. The thing was the rate-of-increase, not the high value of the oil on board.

It is not enough to take 2 million barrels of oil off the market, because those extra two million barrels will be replaced the very next day. The effect of the loss of supply diminishes each day and becomes negligible after a short period. 2 million barrels is a vanishingly small percentage of annual oil production.

If you want to manipulate prices, you need to take the 2 million barrels (or some significant amount) off the market every day, and keep them off the market. Otherwise, the effect dissipates like ripples in a pond.

Oil prices have been going up for almost 2 years. If that was a result of manipulation, then someone has been stashing hundreds of thousands of barrels of oil a day for two years.

That's a staggering amount of oil to store. To take 1% of the world's oil production offline and store it would mean someone is sequestering about 275 million barrels of oil a year. That works out to about 137 VLCCs. And 1% probably isn't enough to account for the past year's rise in oil.

No one is cornering the market on oil. Oil is too bulky, and the scale of oil trading makes it pretty much impossible.

Moe - in your opinion what is a "large amount of inventory" that might "scare traders"?

And is large inventory a sign of huge surplus or pending shortage?

I think inventory needs to be analysed along with / in context of price and the available storage facilities.

River, you asked for my opinion and I will give it to you. The article is total absolute nonsense! The Fed does not have legislative powers. They are not an arm of the law.

Can't you just see a group of bankers boarding a tanker and saying: By the powers vested in us by the Federal Reserve Bank we commandeer all the oil on this tanker! Yeah Right! Read it again River.

Here are excerpts from the Fed’s release suggesting the expansive plans Citi had in the oil storage and transport business:

Citigroup will require that the owner of every vessel that carries oil on behalf of Citigroup be a member of a protection and indemnity club and carry the maximum insurance for oil pollution available from the club.

Methinks Ms. Martens needs a course in reading comprehension. The oil, in this case, is already under contract to CITIgroup. They do not need to take possession of it, they already possess it or are under contract to buy it. They have every right to say that tankers that carry oil on their behalf to have proper insurance against pollution take necessary steps to prevent spills or pollution.

Ron Patterson

Ron, that is exactly what I expected you to say. It is you that need a course in reading comprehension. But, some people take longer than others to 'get it'. Perhaps if you re-read it? Or, you can simply push the 'down greenie'...Yeah, that is probably the ticket for you.

After all, gotta stay on topic.

Gee Ron, since oil has increased 697% one would not think that spare capacity would be sitting around in tankers in the Persian Gulf.

Well, after being wrong about the 'no 1979 gas lines' and the 'there is no discrimenation in the South' and 'there are no conspiracy theories'...What was I to expect from you? The unseen hand must be working hard to acheive an almost 700% rise in crude while spare capacity sits around in tankers. Meanwhile the head of OPEC states flatly that 'refineries are not calling for more crude'...Whats up with that? BTW, you should know that the SEC, FED, Treasury, OCC, CFTC, etc are joined at the hip with Wall St bankers. Paulson at Treasury was head of GS. These guys rotate in and out of fed regulatory agencies and Wall St firms. They are the same thing!

'And while the Wall Street firms of Goldman Sachs and Morgan Stanley have been fingered by Congressman Bart Stupak (D-Mich) for gaming the system, Phibro has completely escaped scrutiny during a seven year period when crude oil has risen an astonishing 697%.'

'On May 6 of this year, Tyson Slocum, Director of the Energy Program at the nonprofit watchdog, Public Citizen, testified before Congress on yet another roadblock preventing a meaningful investigation of oil price manipulation:

“Thanks to the Commodity Futures Modernization Act, participants in these newly-deregulated energy trading markets are not required to file so-called Large Trader Reports…These Large Trader Reports, together with the price and volume data, are the primary tools of the CFTC’s regulatory regime…So the deregulation of OTC markets, by allowing traders to escape such basic information reporting, leave federal regulators with no tools to routinely determine whether market manipulation is occurring in energy trading markets…The ability of federal regulators to investigate market manipulation allegations even on the lightly-regulated exchanges like NYMEX [New York Mercantile Exchange] is difficult, let alone the unregulated OTC market.”...snip...



For the discussion in general.

I don't consider it a worthy discussion. I think this River guy is trolling this group and wasting everyones time.

Great handle!

I would be interested to hear your opinion of this article, Ron.

Ron, that is exactly what I expected you to say. It is you that need a course in reading comprehension.

Sorry Charlie! And sorry for the corny commercial reference, but I think River gets it exactly right. However, the data and the facts tend to overwhelm us, (me included), and the scheme - whether intentional or not - seems too grand to be real.

And there lies the crux of the problem. We are exhausted by information and by current events. This creates a cognitive dissonance. Had one today, thank you. It takes a sublime mind to look through and summarize the various data points. I believe we call this "connecting the dots" these days.

Things are f*#%ed up these days - more than we care to contemplate.

"We choose to listen to the fool on the hill after the catastrophe has ruined our homes and lives." - quote, "Me"

I keep asking this question and I wonder if you can answer it:

I understand that a manipulator with deep pockets or control of the source can game the price of a commodity by keeping it off the market so if CITI had significant storage capacity they could do this. What I don't understand is how someone without the storage capacity could game the market since they will need to close out each contract before it expires.

Is it your understanding that the speculators are storing the oil and if so where? There are a few tankers in Iranian hands and CITI may have bought some existing tank farms but I have not heard of significant new storage and if there is any it is being hidden from the various agencies like IEA since they are reporting decreasing stores.

I expect the numbers are too big for that to work very well. Let's say you wanted to offset an added 200K/day increase by SA. So if SA produces 200K more then you want to keep the prices from falling, which is at least what someone would have to do to get prices up to where we are anyway. To do that you would buy up and store 200K/day. At 2 MB per tanker you'd fill a tanker every 10 days. So in the last year you would have stockpiled about 36 tankers. Where would you put them and people are going to notice that, whether in a tanker or a tank farm or somewhere. I just can't imagine it won't be noticed. And I think that's at the low end. We're not talking diamonds here - not so easy to hide the flow rates we're missing.

All that being said however, it looks for all the world to me that the Saudis realize what a damn mess the world is in, concerning the supply of oil on the market. And, they are doing what they can to help.

Yeeaah, right. Either: 1) the Saudis had a gun put to their head by you know who -OR- 2) a deal was cooked involving Iraqi oil coming thru SA -OR- 3) the Saudis are simply buying time, hoping Jan brings someone to the WH who's less inclined to bare knuckles -OR- some combo of the above.

UAE Business Magazine: Oil set to surge past $150 after divided Jeddah meeting  
By Peter Cooper  on Tuesday, June 24, 2008

The adhoc summit of oil producers and consumer nations held in Jeddah over the weekend appears to have backfired with prices now set to head higher rather than lower as a consequence. Host Saudi Arabia is convinced that speculation is behind the recent hike in oil prices. But ironically the conference designed to unmask the speculators has given them more to play with this week. . .

. . . The problem is surely that both the Saudi Arabian argument that oil is not fundamentally in short supply, and the argument against speculation propounded by Sam Bodman from the US are wrong. At the moment the oil market is horrendously tight, at least in terms of light crude and refined products. Meanwhile, speculators have taken increasing positions in the market and are forcing prices higher and higher. Only the US could have the bare faced cheek to suggest otherwise. Money has been pouring into commodity futures, doutbtless borrowed at cheap rates courtesy of recent Federal Reserve interest rates cuts. This might be money intended to prop up the US banks and bail out the housing market but it is going into commodities.

Too much money pursuing limited goods and services is the monetarist recipe for inflation and nobody disputes that oil price inflation is happening. That the main actors can not agree on the reason for this price inflation is reason enough to think that it will continue for quite sometime to come, and that we will be debating the reasons for $250 a barrel oil within a year.

One of my character flaws out of many is I love to be right and I get the Cupie Doll prize on this one! I'm sure like many of the other TODers that the Jeddah Bong Party wouldn't help in conventional peak oil conditions or global market price.

The lack of simple arithmetic skill across all avenues of society is alarmingly disquieting. 200K of oil = 0.24% increase. Whoopee!! We're saved! Armageddon averted, thank friggin' Christ! Move along folks, nothing to see here. I believe Dr. Bartlett got it right on so many different levels.

It seems the MSM has taken its math lessons from Bingo Hall 101. Keep placing those dots and everyone gets to win folks!

I despair for the species...

I thought she was damn near hysterical touting the fact that we can continue to suck from the oil teats of the Saudis for the next few years.

21 April
Saudi Arabia has kicked off production at its 500,000-barrels-per-day Khursaniyah oilfeld, Abdullah Jumah, head of state oil company Saudi Aramco said.

23 June
Saudi Aramco is set to bring the Khursaniyah oilfield project - capable of pumping 500,000 barrels per day - on stream in August, Amin Nasser, the senior vice president of exploration and producution at the Saudi Arabian company, said today.

Do you think Abdullah and Amin speak much?

I caught that as well. I wonder what they'll be saying in August.

May I interest you in a camel?

If you're committed to driving nice and slow these days, consider this for a bumper sticker. Don't worry, you'll give them plenty of time to read it..

"Have you ever noticed that anybody driving slower than you is an idiot, and anyone going faster than you is a maniac?"
- George Carlin (1937-2008) .. A good American idea, finally driven into the ground. Thanks, George!


There's the one Carlin quote that comes up in the random quote box on this page. If the TPTB can swing it, that should be set on that comment for today as a tribute.

What a loss...

Now...back to your regularly scheduled energy programming.

I think Carlin may just have been an energy-source.

In the vein of 'Monsters, Inc', where the onetime fuel-source of SCREAM was found to be less powerful than its psychological neighbor of Laughter, I have to contend that such comedy and smart social commentary work to leverage our fears and pain towards a common-direction and sympatico, while fear and rage get us spending our energies pushing against one-another, cancelling out many of our efforts.. albeit this is lucrative for the middlemen, those who can tap the energy between the opposing forces by selling guns, painkillers (or other drugs) and insurance-contracts.

It's almost the difference between fission and fusion..

OOH, very deep! (..but for a clownfish, he's not that funny..)

Not so far off base as you think. Once I explain the theory of the energy/consciousness transform, your conjecture makes perfect sense. But then, the fact that we arrive at similar consciousness points also substantiates the theory.

For the record, nothing new here. It's been known for thousands of years; I've only re-contextualized it. And the great wheels keep turning...

Good idea. I'll see what we can do.

The quote is:

“Where ideas are concerned, America can be counted on to do one of two things: take a good idea and run it completely into the ground, or take a bad idea and run it completely into the ground.”
—George Carlin (1937-2008)

Rest well, George.

The loss of someone like Carlin is a loss for Humanity in general. His passing lops a fair few IQ points off the average Westerner.

RIP George.

"That's why it's called the American dream, you have to asleep to believe it"
Bye George

Jim Borgman just coincidentally penned this oil-related tribute to Carlin just before he died. Perfect.

carlin cartoon

Obama Camp Closely Linked with Ethanol

Obama's support of the corn-to-ethanol boondoggle, along with McCain's call for a federal gasoline tax holiday, shows what a world of dodo we're in.

Boone Pickens hits the nail squarely on the head when he says that we just have no leadership in this country.

You do know he is a senator from Illinois, right?

The sum over all time and space of every individual following his or her own best perceived interest will be the maximum happiness for all.

I guess you can take that on faith -- Obama appears to share the faith of Adam Smith.

That is one reason he had his first big win at the Iowa caucuses.

If McCain does not support ethanol, he will lose Iowa just like Hillary.

Opposing ethanol is a vote loser.

I have a very simple concept and I'm not the first to iterate it. Stop looking to leaders and start leadership in the home and in the community.

We should be giving them the big communal flipping of the bird. If I could encapsulate what I know about the American Spirit, this is the core.

I've lived among you and I still have a house in the South, so I'm not talking out my a$$.

Robert Hirsch seems to be losing his caution. He used to refuse to give forward projections, now he is throwing out big numbers and small time frames. Is this really wise?

Do you really think oil could go to $500?

At what point would price fixing / rationing be implemented?

At what point would a massive economic downturn destroy demand?

I think Matt Simmons has also been somewhat wild in his predictions. I have a great deal of respect for these guys, and yet I am afraid that some of these predictions aren't going to come true if demand falls off for whatever reason.

Saying oil could go to $500 a barrel within 3 to 5 years seems extreme to me. I can see it happening but I hate to see Peak Oil advocates end up with egg on their face.

Yes, it is extreme, and probably irrelevant.

I would think that by the time $300. a barrel is reached, the world economy would be in a tailspin along with the resultant evaporation of the global money supply.

$400., $500.,, $600. ...it won't really matter anymore.

Hisrch said it could go to $500.00, however if oil "only" hits $250.00 in the three year time frame Hirsch will be off the mark by $250.00 and Yergin will be off the mark by "only" $200.00.
To the MSM's way of looking at things Yergin will be closer to being right than Hirsch,

As you say irrelevant. The economy would be wrecked either way.

Hirsch said $500 was a worst case scenario, not his primary expected outcome.

My overly, vastly and unreasonably simplistic curve fit hits $500/bbl in two-and-a-half years (January 2011)


The question of how high prices can get is best answered by consideration of what we're doing with $100 oil, $150 oil, $200 oil, and $500 oil.

The market can support $500 oil if we get enough benefit out of it and use it efficiently enough. But $500 oil won't be going to maintain, for example, mass long commutes, or plastic bags in grocery stores. That type of demand will have been destroyed long before $500.

I've been wondering lately about how oil will get to $500. I can see it happening mainly through depreciation of the US dollar.

In my view one of the worst housing crashes in history is just getting started in the USA and the UK, and I expect both housing and stocks to plunge in tandem over the next 3-5 years.

Given the scale of the economic fallout (Great Depression Mk II), I could easily see confidence in the dollar evaporating in a "peso moment" as foreign investors desert the dollar.

The interesting thing about this scenario would be that demand destruction would be overwhelmingly concentrated in the USA. US incomes would be plunging in global terms, forcing the rapid adaptation of fuel-saving methods such as carpooling, moving closer to work, taking the bus, riding scooters, sleeping on the brother-in-law's couch. Third-world patterns of fuel use.

This could cut demand by several million bpd over the course of a few years. Thus sparing the rest of the world much of the pain of adapting. If the situation in the US was bad enough, it could even free up some fuel for further growth in fuel use in China and India - making things even worse in the long run, of course.

The key thing here is that it would actually be a downward spiral. As the dollar dropped, Americans would suffer the most painful increases in fuel costs. Which would hit the US economy particularly hard. Which would lead to further falls in the dollar, and even higher fuel costs, etc

The rising cost of oil in US dollars could fuel a cycle of US currency collapse, US economy collapse, and further rises in oil (measured in dollars).

And the worse the implosion was, the more oil would be freed up for other countries.

As noted up the thread, what we are seeing is a continuation of a trend that started in 2005--fewer consumers paying a higher unit price for a declining volume of exported oil. It's just that now forced energy conservation has started to move into US suburban neighborhoods--with a vengeance.

As Ayn Rand said, "You can evade reality, but you cannot evade the consequences of evading reality."

(Continuing irony, she was an energy cornucopian. Of course, the economists and cornucopians are, to some extent, correct about alternative energy sources; the problem is trying to meet anything like current demand with alternative energy sources.)

That strikes me as a great post -- the Cornucopians must be given their due if they are to be included in the solution to the giant problem of declining resources.As the Quakers say, "everyone has a piece of the truth."

Supply will always balance demand in the medium to long term. The trick will be to balance it in a way that doesn't result in misery for the multitudes.

I believe (take on faith, that is-- no citations) that such a thing is possible-- there is plenty of everything to go around if people can only learn to share.

One example -- I am driving I-5 from Anacortes to Portland, and there are hardly any motorhomes on the road! This can only be a positive first step.

I believe (take on faith, that is-- no citations) that such a thing is possible-- there is plenty of everything to go around if people can only learn to share.

Apologies for the semanticism, but I think it matters: Do you believe that such a thing is possible IF people can only learn to share, or do you believe that people CAN learn to share (in a sufficiently generalised way that doesn't result in those people who still don't learn to share ending up with it all).

My realisation (call it a reluctant faith based belief) that people (generalised humanity) can't (sufficiently) learn to share is what makes me think the 'balancing trick' will not be achieved.

Short answer -- people seem to be able to share scarcity, the example being all the stories of people during the Depression, etc., helping each other out. They don't seem to be able to share wealth very well -- watch the BBC series Fall of Eagles about the decline of the great European Royal families at the end of the 19th century. Even if it isn't great history, it is great metaphor.

I take it on faith that we can learn to share wealth. But I admit there is no historical precedent

What a marvelous articulation of this truth.

I'm very impressed.


Hmmph... I got pithier fer ya: People are greedy, but misery loves company (and needs it to survive.)



During the great depression, many (most?) towns had signs up telling the unemployed to keep moving ("We can't take care of our own"). There were numerous instances of hobo camps being raided by local townsfolk, who arrived with guns & baseball bats. People were beaten, some killed, the shanty towns destroyed.

The mists of memory have a way of fogging the distant past. Years later people want to tell stories of helping their neighbors, not stoving in someone's head with a baseball bat.

I don't mean to sound one sided. The Great Depression brought out the best and worse in people. I just think it is important not to bury the worst and romanticize the era into something it was not.

I am reminded of the first law of Economics:

Self Interest.

There it is in all its naked forms folks. It's not "supply and demand", those are causal effects. Wealth is not shared because it does not serve self interest. Disparity is shared because it does serve self interest. We are the selfish gene I guess...?

Clearly Dr. Hirsch was frustrated with the "BAU" attitude.

He did not predict the price of oil, but noted the very real possibility of the relatively high prices.

Unfortunately, this is a bit of a media trap, in that the MSM often quotes such statements as some sort of firm prediction rather than a statement that we "Could" or "may" see a very high price.

Saying oil could go to $500 in five years is not a prediction that it will. But I know the MSM does not do that kind of nuance.

I'd welcome a little egg on the face if such "wild" predictions don't materialize because drastic action was taken now.

"Wild" predictions are often necessary to change public perception:

With Hirsch and Simmons now both getting notably more anxious, it could suggest that they "know" things through "connections" we can only guess at.

I'm sorry, but what's to guess at?

(Insert bug-eyed emoticon here.)


Given that the credit crisis 'Round 2' is about to hit us during the next 3 months, possibly causing oil to fall below $100 for a period of 12 months or more, talk of $500 oil does seem to bit a bit irrelevant at the moment.

Not at all. If oil eventually hits $500, it may be thanks largely to the US dollar falling in value - as the credit crisis, housing crash, stockmarket crash, and the ensuing breadlines and riots cause people to lose faith in the future of the American economy.

Americans aren't the only people in the world who buy oil. Oil may end up at $500 because $500 isn't worth much anymore.

Look at the last 7 years. The US dollar is worth half what is was, measured in Euros, Swiss Francs, or Australian Dollars. I expect that trend to continue.

I have no doubt that there will be a drop in US demand. But other countries may take up the slack. The price may be lower measured in Year 2000 dollars, but who is to say what it will be in Year 2015 dollars?

The mystery story of the Maya slowly reveals new twists

The research paints a picture of the classic Maya civilization as one big connected society from antiquity, and the "collapse" looks more like a series of local catastrophes, rather than a single apocalyptic event (apologies to Mel Gibson for the Apocalypto reference.) "The public needs to understand that the so-called Maya collapse was not an overnight affair that resulted in the total disappearance of the Maya people. The collapse took place over a period of more than 200 years," says Bey. "The result was the breakdown of elite culture and the abandonment of their cities. However, millions of Maya continued to live in Mesoamerica, especially in the northern Maya lowland, as they do so today."

If the Maya took 200 years to collapse, I don't think it's going to be an overnight deal for us.

Also, the comments under the article are scary:

The biggest and best archaeological lesson we can learn from the Mayans is that all pagan, godless society's eventually die and are lost forever. The ruins of their cities stand as tombstones to a dead, godless society. If America does not remember where she came from, repent of her sins, and return to her first love, Jesus Christ, then someday people will be snooping through the ruins of THIS nation.

We're doomed.

We may not notice for centuries, but we're doomed. ;-)

Rolling down a hill is a gradual affair that takes a while.

Falling off a tower is a much less incremental event.

Both end up in the same place, but the degree of resilience and the level of interconnection in a civilisation have a strong effect on how steep the gradient is.

Hard to say which analogy applies, though.

Easter Island appeared to take maybe 50 years to collapse, Rome over 400. Scant data points indeed, but it suggests the bigger they are, the slower they fall.

Hi Leanan,

I suspect it is a little of both. As a much more complex society, there may be more larger increment falls from the peak (of current civilization).

So, it won't be overnite, but there will be many smaller horrifying overnite changes, IMO.

Depends how integrated, dependent, and 'efficient' they are.

Easter Island crashed because they were so dependent on their limited local resource. The Roman Empire (rather than Rome) took 400 years to collapse because of a fairly distributed nature where parts could survive without the head.

We've built a structure which through 'efficiency' is extremely non-resilient. It depends on what you classify as civilisation, but the expectation should be a fracture and dissolution on the basis of cascade failures from minor causes. Before there is 'no oil' there will be impacts of 'no cheap oil' that cause the system to breakdown both in its higher level functions and in its geographic connection.

In short, I don't think its size, I think its interconnections that determine the rate.

In short, I don't think its size, I think its interconnections that determine the rate.

But those are not unrelated. The larger the society, the more interconnections. Interconnections can mean resilience as much as dependency.

I found it interesting that the archaeologists see it as "not one big collapse, just lots of local catastophes." Makes me wonder if that's how our collapse will look, too. They'll see local disasters, like Katrina and the midwest flooding, and assume those were the "cause" of our decline.

Leanan - "Interconnections can mean resilience as much as dependency."

The "interconnections" that currently bind the world together are a series of production and distribution links. As most readers of the Oil Drum will agree the Ghost in that Global Machine is Oil.

Herman Scheer in his seminal book The Solar Economy correctly points out that "The resource base is far more fundamental to economic development and stability than questions of political and social order"

Since our globalized economies are all tethered to that same resource when disruptions to that resource occur the unwind will be terrifyingly quick and for vulnerable populations: fatal.

Since our globalized economies are all tethered to that same resource when disruptions to that resource occur the unwind will be terrifyingly quick and for vulnerable populations: fatal.

I just don't see how it's possible to say that. There's no evidence.

It's not like all oil is going to vanish overnight. We will switch to more expensive oil, and probably to coal, solar, nuclear, etc. And there will be a lot of conservation, if only by price. I don't expect that those sources will keep the happy motoring going, but they will keep society going, in a Great Depression kind of way. Lots of people suffering, some doing quite well, everyone waiting for the recession to end like they always have before.

Think of it like this. Someone in a boat in Nigeria raids a site on Monday and on Wednesday someone is paying 10c more in the midwest.

The interconnections connected to oil are strong and permeate many systems of society.

Now, thanks to efficiency, we tend to have very much just-in-time rather than just-in-case systems. Buffers and redundancy is taken out, timelines are shortened and there is less scope for things going wrong.

As the systems of society are placed under stress (such as during a recession) the scope for any one area to fail and have no knock effect is reduced. At an end point the positive feedback systems are such that very small perturbations 'cascade' to have very large effects.

The boat in Nigeria means the petrol station shutting up shop, means the power worker not being able to refill and get to work, means the lack of maintenance at the power station resulting in an outage, that spreads through the overloaded grid to cut power over a wide area, results in riots from a disenchanted populous, results in the withdraw of insurance from wide markets, results in fracturing of all input/output chains across all systems and the end of civilisation in that region.

That's a cascade type failure, and although we haven't seen exactly that instance, we have seen many of the parts of this chain actually happen.

'Interconnections' is a simplified term to represent the dependency relationships in system dynamics that have had their resilience to being part of positive feedback loops reduced by 'efficiency improvements'. Where there is no 'outside' to sustain and effect a rescue activity the entirety can run away; and there is no outside to oil dependency in this context.

Yes, but I don't see that the failure of JIT will be sudden and catastrophic. Indeed, we are seeing a trend away from it, as organizations start to fear for their supply lines. The cascades might be smaller than you think.

It seems quite simple still to shut down a manufacturing line especially because labor sees how much power they have to disrupt the system.

From this description it sounds like on a micro level the whole line would have to be reworked to put in place buffers. But I think the biggest issue is the complete loss of a single part, without which the line cannot start up again without an engineering workaround, a substitution or the part arriving again from the supplier.

On a macro level, I will give you that although lots of warehousing would have to be built, new warehouses can be erected quite quickly now if there is space available for it.

Yes, I think we'll see an increase in hoarding, due to price spikes, even if there are no shortages.

But the most interesting example may be Boeing and their 787. A global supply chain seemed like a good idea at the time, but has turned into a nightmare. I think a lot of people have looked at that and seen it as a black mark on globalization.

Higher fuel costs are also turning the globalization tide.

And even if production has to be shut down for awhile, it's not catastrophic. It happens all the time in Africa and Asia, where we get a lot of raw materials and manufactured goods. Energy shortages, raw material shortages, transportation issues, etc.

Leanan, do you have a favorite description of the 787 situation?

Not really. I've just been watching the story over the past year or so, and the reaction to it. Here is a quick overview.


I wonder what the conversations were when the executive settled on the plan to use suppliers from across the world. Having worked with many business people, my guess is that the potential problems were brushed off.

Contrast that to the approach Steve Jobs used when designing and rolling out the Apple stores:

Apple has no misgivings that it is moving into an area where a tech company can get into trouble.
"Our attitude is retailing is really hard," Jobs said. "We're from the high-tech industry, and we don't know much about retail." For this reason, Apple wanted to "surround ourselves with experienced people in retail," he added.

He didn't use "it's hard" to stop him, just to make sure that people really, really did their homework before launch.


Reminds me of someone who did not do his homework before launching a certain resource war...


Hello Leanan,

Your Quote: "Yes, I think we'll see an increase in hoarding, due to price spikes, even if there are no shortages."

Imagine if, back in the early 1900s: you had hoarded potash before the price spiked from $15/ton to $350/ton [$14,500/ton in today's dollar].

Might we be seeing the same process going on now, or starting soon in sulfur & I-NPK? Job specialization depends upon food surpluses, but I don't see evidence yet of world grain reserves increasing plus everyone going to bed happy with a full tummy.

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

Leanan - "they will keep society going, in a Great Depression kind of way."

I don't see any paralell of the coming collapse to The Great Depression. My Grandparents on my fathers side went through the Great Depression. My Grandfather was a finish carpenter and my grandmother besides raising four kids tilled an acre of land with help from the kids providing a large amount of their food. The Great Depression was not about resource shortages. The current collapse in waiting is.

Today we get our water from a tap and our food from a store and our information from a group of talking heads who are even more clueless than we are. The mono-crop industrialized farms without massive inputs of fossil fuel fertilizers will fail. I don't know anyone who could raise their own food.

Our current dependence is too great to hope for a soft landing.

The Great Depression was not about resource shortages. The current collapse in waiting is.

I don't think the problem is resource shortages per se. The problem is the system that requires constant growth and ever-increasing consumption. The demand destruction that would accompany a depression might make any resource constraints fairly invisible.

So much of our economy is devoted to things we don't need...things we won't be able to afford when the Grand Depression starts.

So much of our economy is devoted to things we don't need...things we won't be able to afford when the Grand Depression starts.

Yes, and too many people are employed/depend on are being able to buy "things we don't need." It is this part of Demand Destruction few seem to understand, as if they'll be immune to its effects. This report contains a lot of information about the US Service Sector, and there are several categories of data. Look at employment in the big chart and then scroll to the bottom to read its specifics, especially which industries reported growth or reduction. My interpretation is a lot of seasonal hiring took place while a substantial number of longterm permanent jobs declined, which is what one would expect to see given declining discretionary spending. The inventories section is also interesting.

This report is issued monthly:

The full text version of the Non-Manufacturing ISM Report On Business® is posted on ISM's Web site at www.ism.ws on the third business day of every month after 10:10 a.m. (ET).

The next Non-Manufacturing ISM Report On Business® featuring the June 2008 data will be released at 10:00 a.m. (ET) on Thursday, July 3, 2008.

Oh, I understand it. That's why my comparison is to the Great Depression. I think peak oil will be experienced as an economic crisis.

Thanks for that report karlof. Thats exactly what I am trying to keep an eye on.

By the way my friends that work at HP here in Cor say they are being told that up to half the workforce is being let go. OUCH!

Grand Depression - interesting term. WWI was called "the great war" until WWII came along, and we all have WWIII to look forward to. Why not just number the depressions too, and call this one D-2 ?

How about "The Depression to End All Depressions"?

The Mother of all Depressions?

It's not like all oil is going to vanish overnight.

No, but for oil importing-nations, a huge amount will vanish quite rapidly. And Lord knows how much the available oil will cost.

As westexas wrote upthread, oil exports from Norway, Mexico and Venezuela are declining precipitously. Plummeting. Mexico's exports could fall to zero by 2010. Furthermore, Matt Simmons expects "the Great Oil fields of the Middle East" to soon fall into a North Sea-like spiral. If that happens, exports from the Middle East could reach zero in very short order. Also, as famine and social disarray rise, levels of violence in oil-producing regions (e.g., Nigeria) will also curtail production, perhaps drastically.

The picture is grim for oil-importing nations. Especially when you factor in the future of natural gas.

I don't expect that those sources will keep the happy motoring going, but they will keep society going, in a Great Depression kind of way. Lots of people suffering, some doing quite well, everyone waiting for the recession to end like they always have before.

Drawing comparisons between present-day America and 1930's America seems a tad ridiculous. In 1930, the U.S. had less than half of its current population. Many of those people could still feed themselves. The country hadn't yet paved over the good farm land and destroyed its rail system. The list of differences goes on and on.

It will be much different this time around. Most of our farming equipment now runs on petroleum. That food is distributed by petroleum. And society is simultaneously being slammed by climate change, fisheries collapse, and a host of other problems.

a host of other problems.

Yes - like how much tribute Washington DC needs. How can the present tax load be supported without oil?

We will switch to more expensive oil, and probably to coal, solar, nuclear, etc. And there will be a lot of conservation, if only by price. I don't expect that those sources will keep the happy motoring going, but they will keep society going, in a Great Depression kind of way. Lots of people suffering, some doing quite well, everyone waiting for the recession to end like they always have before.

I don't understand making such predictions/formulating such scenarios with energy as the only variable. Infrasructure plays no role? Climate change plays no role? Etc.? What if we have a massive climate flip in the next ten years? Do we just keep motoring along in our New Depression?

I strongly suggest people stop thinking and even discussing in such simplistic terms. If we just keep motoring along, Leanan, in any sense, we will very, very possibly bring on massive climate changes sooner and more ferociously than most think possible. (The Arctic is melting and the methane is seeping...)

As for interconnectedness, when that interconnectedness = redundance, then I can accept your argument, but in the current case can we make that claim? The Anasazi, for example, thought they built in complexity and redundancy, but kept all their extra grain in a central area. When that area went belly up, the outlying areas couldn't hold the center. But, hey, they had food growing everywhere...

It only takes one critical component.

With regard to Rome, the complexity lie in supporting Rome, not the Empire. Each area of the empire was nominally free, but had to support Rome. When Rome could no longer get what it needed from the various areas, collapse ensued. But those areas, themselves, were still functioning states within the Empire. There was a great deal of redundancy built into the empire's model.

One could try to argue the same now, except that the support of Rome (The US primarily, OECD inclusively) is done with the same basic commodity in every nation: oil. Thus, the underlying redundancy is a sham. The areas are nominally independent of each other, but all rely on the same depleting resource(s), so when one falls, all fall - or nearly so.

No, if there is collapse, even if it is catabolic, it will not take anything like 400 years.


With regard to Rome, the complexity lie in supporting Rome, not the Empire. Each area of the empire was nominally free, but had to support Rome. When Rome could no longer get what it needed from the various areas, collapse ensued. But those areas, themselves, were still functioning states within the Empire. There was a great deal of redundancy built into the empire's model.

Rome collapsed as more and more provinces were overrun by Germanic tribes thus the taxing power crumbled but the army had to be kept at more or less the same size. There was not much redundancy built into the model - except for having multiple provinces. When the Vandals took out North Africa 435 the Western Empire was in severe difficulties. A different outcome to Leo's disastrous fleet operation against the Vandals in 468 quite likely would have given the Western Empire at least some decades if not centuries more breathing space...

Being overrun I don't believe the British provinces to have been governed by King Arthus' "functioning state" thereafter... Apologies for being sharp here but I do not see any value in discussing the implications of peak oil using force-fitted historic examples.

I don't know where I read it, but I'm sure it was through links here at TOD, but the food system and the ability to mine silver in Spain (flooded mine) were both contributors, it seems.


I think that the amount of time an Empire takes to collapse depends a lot on your perspective. To those living at the time the failure of Rome to protect them from the invasions was probably quite a shock and most likely appeared to them to be sudden. From our vantage 1500 years later we can research at our leisure and find the seeds of Rome's destruction over those 400 years. Part of the problem is defining when the collapse started and when it was finished. If Rome had been able to battle back and maintain some amount of empire through today would we say that it was collapsing or that it had contracted and stabilized?

To those living at the time the failure of Rome to protect them from the invasions was probably quite a shock and most likely appeared to them to be sudden.

I doubt it. Tainter points out that one reason Rome collapsed is that the people started preferring the barbarians to the Romans. That suggests that they did notice. They were not passive victims of collapse. They made it happen, because they were not getting what they wanted from the existing system.

Well that's being discussed and I can't believe that anyone who was right in his mind would have exchanged Roman rule for barbarian rule. Which barbarians is he referring to? Huns???

There are not many documents left, but the way the people in Noricum tried to maintain a Romaness lifestyle whist the heartland could not support them anymore (460-48x) is quite fascinating. They continued to do so even as they could not get any subsidies from Rome.

I once read an exerpt from the biography of an Eastern Roman general who had left Italy as a boy and returned as an old man when Justinian tried to reconquer Italy from the Ostrogoths. He was shocked at how the population of Italy had collapsed, and how the well-tended farms had returned to wilderness. This happened in about 50 years.

Would that be Bellisarius?
I would be interested in any reference you might have to the biography.

Which part of the Roman empire took over 400 years to fall? As the Roman empire expanded until about 110 are you referring to the Eastern part? The crusaders' sacking of Constantinople in 1204 should qualify as an external event and from there it took only about 250 years to its ultimate fall. Also, I'm not sure that (west) Rome's decline was caused by internal forces. Heather points primarily to the increase in capabilities of the Germanic tribes and the arrival of the Alans and later the Huns. There are no indications for resource related constraints in the downfall of the Roman empire.

the arrival of the Alans

We Alans are a fearsome bunch ! Easily a match for the finest Roman Legion !


Leana, that 400 years figure for the collapse of Rome is imaginative. The beginnings of collapse of Rome, as opposed to Constantinople - the Easter empire] started in AD ~425 with the first sacking by the Goths, and it was done in ~495 the second sacking and final push into oblivion. After that it was never more than a backwater city on the Tiber. Meanwhile, the Easter empire lasted until the late 15th century when Constantinople was captured by the Turks [after being first sacked in ~425 by the crusading Christian nobility looking for treasure].

ImSceptical that any one of the mentioned dates is correct. Crusading Christian nobility in 425 is off by some 700 years...


There are contrary views of the Easter Island story.
I have in the past used the Easter Island analogy to describe the path we are taking, I don't now subscribe to the popular belief.

Speaking of the Mayans, it is interesting that P.O. is hitting as their calender is about to to end. The last day of the Mayan calendar is December 21st 2012.

And we should remember that we look at the Mayan civilization from the perspective of another highly complex urban oriented society. We envision the loss of complexity and the failure of cities as "collapse." From another perspective this might be viewed as a positive change toward a more decentralized culture. The Mayan people did not lose their culture during the "collapse." (Indeed, they have lost more since another urban based culture stole their lands and forced them to rejoin another centralized "complex" society.)

This is not to say that people did not die, that many did not lose their economic well-being. Any transition from centralized complexity to decentralized simplicity requires such hardship. For the urban dweller whose city fails, there is "collapse." For the rural dweller who no longer feels the yoke of the cities power elite... .

Will there still be cities 100 years from now? No doubt. Will there be bustling metropolises driving the economic and cultural life of the planet? This remains to be seen.

Lenan, there are many theories concerning the Mayan collapse. Before I retired I worked near, and was a personal friend of Dr. Tom Sever, who's main job was researching the Mayan collapse at NASA. (Google Tom Sever Mayan Collapse and you will get hundreds of hits.) At any rate, we had many long discussions concerning the Mayan Collapse. But several points must be pointed out:

First, the Mayan Collapse did not take place everywhere at the same time. The Petan was the first to collapse. The coastal Mayans in Belize and on the Yucatan Coast collapsed much later than the interior Mayans. So it would be accurate to say that ALL Mayan Empires took almost 200 years to collapse.

Second, and this is very important, there were several Mayan Kingdoms and they were not connected, except by warfare, to other Mayan Kingdoms. Though great Mayan cities like Tikal, had satellite smaller cities, there was no trade or communication between major cities or kingdoms. Therefore the collapse of one city would have no effect on other major Mayan cities, unless of course they both had the same environmental cause. The same cannot be said of the world today.

There is very strong evidence that the collapse of places like Tikal, in the Petan, happened suddenly and quite dramatically. That is there was a sudden and violent overthrow of the ruling class and the priestly class. The actual dieoff of the population, to about ten percent of the original, took almost 100 years however.

Around 800 A.D., after two millennia of steady growth, the Mayan population reached an all-time high. Population density ranged from 500 to 700 people per square mile in the rural areas, and from 1,800 to 2,600 people per square mile near the center of the Mayan Empire (in what is now northern Guatemala). http://earthobservatory.nasa.gov/Study/Maya/>Mayan Mysteries

But what caused the collapse?

Archaeological evidence shows that by A.D. 800 the Maya had cut down most of their trees -- they used the wood to build large cities and monuments. Signs of drought and a dramatic drop in population followed this destruction of the forest. Making Sense of the Mayan Collapse

The collapse of the Mayan, in the Petan anyway, was triggered by a three to four year drought after the destruction of the rain forest. The top of the empire collapsed very suddenly but it took a century for the total dieoff to take place and longer for the coastal cities to collapse.

The Mayan civilization was 100% agrarian and not dependent on trade with other nations for any part of their resources or survival. They were totally dependent upon human power for all their energy needs. That is totally different from the world situation today. Therefore there can be no comparison to the speed of the Mayan Collapse and the probable speed of the collapse of the world as we know it today.

Ron Patterson

Ron - "there was a sudden and violent overthrow of the ruling class and the priestly class."

Thanks Ron for some great insigts. I wouldn't anticipate any signnifigant revolutionary activity in the USA though. Main-stream Americans are dumbed down, spoon-fed junkies.

I watched a film last week: The Battle of Algiers a 1966 black-and-white film by Gillo Pontecorvo based on events during the 1954-1962 Algerian War against French rule. One of the keys to the overthrow was a massive reform of the native population prior to the overthrow.

Can you ever imagine modern Americans, the bumbersticker culture, reforming themselves?

If and when the collapse in America occurs expect Lou Dobbs to run for President. "A candidate for the Sheeple"

modern Americans, the bumpersticker culture

That would make a great bumper sticker.

"I wouldn't anticipate any significant revolutionary activity in the USA".You could be in for a nasty surprise.It is very hard to predict how individuals,let alone groups,will react to stress.

While history has many valuable lessons the coming collapse is without precedent.This is because it will be global.There are also several severe stressors - a global population well beyond the carrying capacity of the planet;an energy crisis which will be extremely difficult to escape even with good leadership;a looming shortage of vital inputs into food production on the present scale;an environmental crisis due to land and ocean degradation leading into the deep unknown of climate change.All these are interlinked and have to be tackled simultaneausly.It is a big ask.

Couple all this with the possibility of resource wars waged with huge stockpiles of weapons up to and including nuclear and we get well and truly into the realm of unknown unknowns.

thirra - "You could be in for a nasty surprise." I fully expect violence. Americans have a long and storied history of violence. Revolution, however, requires organization and commitment and standing for something larger than ourselves.

Don't hold your breath waiting for that to occur.

"Revolution, however, requires organization and commitment and standing for something larger than ourselves."


But riots and anarchy, rape and looting, and violence and death don't require anything but guns,insanity, and despair

Items not in short supply!

The fuse is already present. All that's missing is the flame.

The probable collapse may be fast. It may be slow. It WILL NOT be pretty.

Best to observe from safe distance.

Nice to meet everyone here.

Thanks for speaking to long-held fears. Glad to know I'm not alone.

Be aware that The Battle of Algiers is very loosely based on the Algerian War of Independence. Very, very loosely.

One of the things that it omits is that the "reform of the native population" was composed of a years long campaign of random murder against the Arab population for no reason except to demonstrate that the French government was unable to prevent it.

I wouldn't anticipate revolutionary activity in the US, and am grateful for that. Pity any nation that dives into the abyss Algeria went into.

Yeah, because our last rebellion and the one before that were SUCH failures...



Edited for stupidity. Mine.

There are rebellions and then there are rebellions. If you support'em all, you wind up supporting real ghastlies.

Which means that industrial society will collapse faster. Mix in some positive feedback loops like climate change and there you are.

Collapse is inevitable.

And the fact that we've put so much energy in sustaining the unsustainable
means that collapse will be rapid.

Imagine Iowa with no one coming in to help.

"But finding an older town (which tend to be more in the East), that’s far away from any major highways (which tend to be in the West), with abundant fresh water, lots of organic farming and ranching going on nearby, sharing a generally progressive mindset (which is fairly rare in small towns at all), with a diverse age range, not upstream or downwind from any major chemical plants or the like, and having a diversified economic base that isn’t reliant on any one (or even a handful) of industries (which is next to impossible; even major cities tend to be reliant on one or a few industries) … that’s a lot of criteria to consider. Of course, they’re all reasonable criteria, and the very fact that it’s so hard to find one suggests all the ways in which small towns are liable not to survive collapse."

The most significant killing stroke for most of the United States will be the fact that almost no land in North America is left that is naturally arable.


"Imagine Iowa with no one coming in to help."

Well, that's New Orleans, right?

That said, except for a particularly vicious and otherwise-concerned administration, there usually ARE people who will risk hell and high-water to come and help. To what degree FEMA let them, many did for NOLA, too. People do this, so 'imagining' that they won't doesn't give us a very realistic set of conditions to make predictions around. As soft and unprepared for hardship as the American people have somewhat been in this age of oil, our genes have not changed much from those people of much harder times.

Not that it will be easy or guaranteed.. not that there won't be absolute disasters in the mix..

I'm just saying.

That can work for localized catastrophes. When there are problems everywhere, there won't be enough rescuers to go everywhere. In other words, do-gooders will help within their locality, but that won't be enough.

It is likely the the first areas of die-off will be in the "third world", and we in the "first world" countries will wring our hands but not help them enough to make a difference. Far fetched? Look at the current situation in Zimbabwe or Myanmar or North Korea or Sudan or Somalia or Bangladesh. Yes in most cases one can lay blame at the local corrupt "authorities", but that's a cop-out.

On the turning away
From the pale and downtrodden
And the words they say which we won't understand
"Don't accept that what's happening
Is just a case of others' suffering
Or you'll find that you're joining in
The turning away"

It's a sin that somehow
Light is changing to shadow
And casting its shroud over all we have known
Unaware how the ranks have grown
Driven on by a heart of stone
We could find that we're all alone
In the dream of the proud


Pink Floyd, 1987

That song has two more verses that are more hopeful, but I don't feel hopeful today.

A Malthusian "die-off" will be global,very likely.However,in those third world countries where subsistence agriculture is currently practiced some people will have a better chance of surviving.They have the skills and knowledge and the least need to adapt.

However,in those third world countries where subsistence agriculture is currently practiced some people will have a better chance of surviving.

I'll say no.

1) In the marginal places there is already a high death rate - thus to say a 'better chance of surviving' would think that the odds are already good.
2) In the marginal places deserification has been held at bay by using fossil fuels for cooking. Go back to wood for cooking, then toss in shifting rainfall and higer temps - the trend does not bode well for the carring capacity of these places.

Older town - Check
Not too close to Major Highway - Nope
abundant fresh water - MAJOR League !
lots of organic farming and ranching going on nearby - A fair amount, including fishing. Rice farming is the most sustainable of the major food crops.
sharing a generally progressive mindset - Fairly
with a diverse age range - Yes
not upstream or downwind from any major chemical plants or the like - Several fairly close, but none close enough for a spill or fire to affect us
having a diversified economic base - Yep, Tourism, port, oil & gas production, refining and petrochemical, food processing, shipyards, medical & educational

Best Hopes for New Orleans,


You know, Alan, before I started hanging out on TOD I had no particular desire to visit New Orleans. No particular un-desire either, just never really thought much about it.

But now I feel like I really need to come on down and check y'all out. I'm just an old Yankee, but I must say that reading some of your culinary posts have left me quite hungry... :-)

Best Hopes for being able to visit your fair city some day...

Please let me know when you come on down :-)

As a preview, check out http://www.nomenu.com

Written by host of a 3 hour drivetime talk show about eating in New Orleans. No other US city has such a show, and perhaps only San Francisco and New York City might need such a show.

Best Hopes,


"Please let me know when you come on down :-) "

Oh, you can bet I will!

Best Hopes to visit your Fair City SOONISH!

sgage--Based on my experience last year, you'll need 7-10 days minimum to see a good fraction of the sights, not just of NOLA, but of the whole region from Pcola to Houston.

Thanks for the tip. I suspect I know what you mean - when I visit a region that I've never been to before I try to have at least a full week to devote to it.

But I'm curious... why is it that whenever I think of visiting New Orleans, I instantly become hungry?

Gumbo or shrimp? Aha! Emerils in the Warehouse District. Or one of the immense Sunday Brunch spreads and jazz to go with it? Cajun blackened redfish? Oyster poboys?

Just go down this list :-)

And tell me you are not hungry !


Best Hopes for Fine Dining,


You forgot the rising seawater and major storms that can level the town.

Is the plan still to tax all of the US of A to save New Orleans no matter what?

Of course not, our taxes are explicitly for the purpose of bailing out GM and giving KBR and Halliburton no-bid contracts.

It wouldn't take taxing the 'whole USA' just to make some reasonable safeguards for NOLA.

One man's "reasonable" is anothers 'failure to plan'.

How much does one spend in defense?

Methane, ice... gurgle, gurgle...



The Maya were not dependent on oil and technology, nor were the Romans or Easter Islanders. I believe that world population will decline to what is sustainable with less oil and technology. 'First world' (stupid phrase) counties will decline faster, naturally, because they have further to decline and have populations that are less prepared to cope with third world circumstances.

When the economy goes then there will be no more oil for fiat dollars and no more purchases of treasury issues. The western world will change very fast then.

The SCO is working in very stealthy ways to destroy western economies. Hell, they are simply giving western economies enough rope to hang themselves along with a gentle nudge here and there.

I think the SCO's interest is in destroying America's untrammeled power. They read the Project for a New American Century manifesto and recognized our threat. However, China is at this very moment trying to expand its markets in Europe and just about every part of the West that doesn't use dollars.

Their ideal end game (which I think has low odds of occurring peacefully) is for bankrupt America to have to bring its forces home, leaving Europe and the Arab kingdoms exposed and looking for a strong new buddy. This makes a lot of sense; these countries between them make most of the things that they need to trade, just as they did in the era of the Silk Road. The Chinese and Russians are not interested in making big changes in Germany; they like their Mercedes and the highly-educated population that is required to build them.

I agree with you S390. The SCO will slowly bankrupt the west and force the troops from their soil.

The west will have only the option of nukes in the end game. That is no option at all.

Gotta go now...lots of T storms and lightning...shutting down. Ron will miss me. :)

One thing seldom mentioned is that there are some very powerful interests based in the USA that are also in favor of a dramatically weakened USA government. China didn't go from infancy in the 70s to today's status without a lot of help from USA interests.

Sure, but sometimes very powerful interests are very stupid. The US needed large amounts of British investment in its factories and railways to become powerful enough to eventually displace Britain as global hegemon. Did the British investors consider the long-term consequences of their actions? Did they intend to transfer their power base from London to New York? If there's a case that those tycoons had an interest in weakening their own empire, I'd like to hear it, because I'm concerned about our businesses' own plans for America's future. Otherwise I have to conclude they just didn't care about Britain being turned into a service economy.

Investors and businesses aren`t burdened with the responsibility of providing for America`s future-the guv is (LOL).

Are you talking about the future of the American people or the future of the US hegemony? They aren't the same thing.

If China gets rich and provides a bigger market, the average american is better off, just as the average brit is better off from the development of the US economy.

For those wondering about the references to 'SCO'

The Shanghai Cooperation Organisation (SCO) is a permanent intergovernmental international organisation creation of which was proclaimed on 15 June 2001 in Shanghai (China) by the Republic of Kazakhstan, the People’s Republic of China, the Kyrgyz Republic, the Russian Federation, the Republic of Tajikistan and the Republic of Uzbekistan. Its prototype is the Shanghai Five mechanism.

The SCO was created on the basis of the Shanghai Five, which came into being after signing in 1996-97 the agreements among Kazakhstan, Kyrgyzstan, China, Russia and Tajikistan on building military confidence and mutual reduction of military forces in border areas.

... making joint efforts to maintain and ensure peace, security and stability in the region, to establish a new, democratic, just and rational political and economic international order"


The key thing, I think, regardless of one's take on their raison d'être, being Russia and China getting much closer. Potentially significance also in the context of US moves against Iran, which has applied to become a full member.

So do you figure this commenter:

a. believes that Rome was still pagan when it finally collapsed

b. believes that Catholics aren't Christians so Rome doesn't count


c. believes that Rome's collapse wasn't a failure because the Dark Ages were also The Age of Faith, and thus exactly the sort of condition we should bring to the entire world?

If the Maya took 200 years to collapse, I don't think it's going to be an overnight deal for us.

I don't think you can assume that a modern civilization collapse will happen like the Mayan collapse. I doubt it will take 200 years for our collapse to happen. It could happen in a matter of days (Global Nuclear War), months Exporters horde remaining reserves, or decades (exporter keep on exporting to the last drop). I think our biggest issue is that just a very small portion of the population feeds the masses, and that virtually everyone has become too specialized to adapt to fast changes. In Pre-industrial societies, 90% of the population was directly involved in food and energy production. Most of the Population back then was self-reliant. Should the supermarket shelves go bare and if they stayed that way, the majority of the population in industrialized society would be dead in a month's time.

I think in the not so distant future:

1. Economic depression: High energy and food costs cut consumer demand for everything else, unsustainable trade inbalances, record gov't, business and consumer debt. Aging populations with expensive entitlements promised in the West, and Exploding populations in th East. The West is already entering a recession which will progressively get worse. The East will probably lag the west from year to three years.

2. Energy and food hording. The Haves will stop sharing with the have-nots. This is when things start to get difficult for the West and the industrialized East. 50-50 chance of regional wars. The odds of Energy hoarding will soar once global oil production slips off the plateau (probably within a couple of years)

3. Collapse in the worlds poorest regions, resulting in mass migrations of starving populations. Some nations will use force to stop the flow the refugees (including genocide). This appears to be underway in Africa.

4. Explosion of disease and illness. First in the poorest regions as food, clean water, and medical services become scarce. Then it will work its way up to industrialized countries. Disease carriers fleeing collapsed regions will spread the disease. I doubt neighboring countries will be able to stop the spread of collapse do to lack of manpower and resources.

FWIW: Its been over four years since the price of oil started to shoot up. Yet nothing has been done to mitigate for energy deleption. In many cases the policy changes have exerbated the problem. I see no change of direction from this path. Its business as usual, full steam ahead. Damn the Torpedos! It you think Regime change in 2009 for the US is going to make a difference, Ha! your living in fantasy land! Washington is full of a bunch of Lawyers and private sector dropouts.

I don't think you can assume that a modern civilization collapse will happen like the Mayan collapse.

Neither do I. I think you can assume it wont. Its far more dynamic, adaptable, and agile than agrarian civilizations. It responds to supply shortages much more smoothly and doesn't have the boom/bust cycles of drought/harvest thanks to international trade.

We're barely in a recession, and people are talking about the fall of industrial civilization.

This sort of alarmist nonsense sure is popular here.

FWIW: Its been over four years since the price of oil started to shoot up. Yet nothing has been done to mitigate for energy deleption. In many cases the policy changes have exerbated the problem. I see no change of direction from this path.

Theres been lots done. Many new large capital projects are in the works now but they have years of lag time before they come online. Theres been more nuclear power plant applications in the past 4 years than the previous 30. Large CTL plants are being constructed in India and China. Its the start of a multiple decade infrastructure adjustment cycle.

The Jesus freaks who first came here tortured, raped, enslaved and murdered the previous owners in cold blood. Then they stole their property. The may have loved Jesus but they loved the loot more.

I've got three words to describe the present and potential rate of decline Leanan:

Peak Entropy Rate

If we look at the complexity of society, the technology that enables the rate of Entropy transformation, and it's sustainability with said technology, then we understand our rise and fall in the grand cycles of things.

Otherwise, I'm waiting for the hand of the Great Bearded One to come save me from the scourage, or I can find the Faith and rise bear bottomed to Heaven in the Rapture. Life sucks until you know it will end! What a bargain, who thought that one up?

This isn't necessarily a reply to BC_EE but a continuation of the thread...


I don't understand atheists or theists. God, Allah, Jesus, Buddha, or Rama is NOT a big hand in the sky. He or she is not anything that the rational and dualistic mind can comprehend. It is not a matter of A or B. It is a matter of "A and B" AND "A and not B".

Please get your undergarments in order (untangled and unbunched).

The issue of Peak Oil is one of the preservation of knowledge (scientific, religious, philosophic, etc, etc, etc) and more importantly, the sad, sorry, and somehow beautiful human fucking race. You know, everything that we've learned and recovered since the last fucking collapse. It's coming. You know it. I know it.

To quote a strong woman from a certain Hollywood film "I'm sick of your shit, Hudson. We need need you and I'm sick of your bullshit. Now stay frosty and stay alert!"

You know, if anyone gives a shit, that is. I don't know about you, but I care.

If not well, again, from the same film, we "Can take all of this bullshit, all of this bullshit we think is so important, well...we can take all of it and kiss it all GOODBYE!".

- Bob

While I somewhat concur with your philosophy, can I suggest that attempting to get others to view the state of humanity/earth/whatever in a shared philosophical light is little more than a surefire way to both self-aggravation and futility.

If you give a shit, and you care, it's much more productive (and respectful) to try and reach others through their incumbent philosophy/religion/conceptualisation/rationality/mindset/whatever, than attempt to adjust their perception of God to align with your own.

? :-)

You're right.

I was just trying to bring the topic back to hand via a little cage-rattling.

You know. Being a n00b with a fresh voice and all.

In this lifeboat of ours, religion, philosophy, and politics take a back seat to cooperation, survival, and general well-being.


- One of many Bobs

Peak Entropy Rate

Thats some time in the future, to turn all the 6000 degree photons from the sun into 300k photons on earth.

Playing the other side for a moment, let's assume they world adds 2 million in capacity to process the heavy sour stuff, that would certainly allow them to pump, and sell, more oil and I suspect in large quantities.

For all the reading I've done on this site, so far the best argument against them increasing output is Jerome's they always say that. I would suggest that argument be abandoned in light of the fact that Peakers "always say" the peak is here. I also made the connection this weekend that most of our predictive graphs slope down starting from now at approximately the same angle IEA and EIA graphs slope up.

It's difficult for me to believe who is really correct in this argument if anyone. I'm a reasonably talented engineer, can do math better than most, and try to keep an open mind. I don't see a novice can possible believe in Peak Oil based upon the content of this site contrasted with the MSM. The chasm between the two groups is overwhelming to the point I would think a rational person would conclude there is no consensus.

Lastly, I'm not a bubblevision fan, except that I watch them and do the opposite. However, Melissa Francis actually spoke to the Saudi's face to face. Has anyone else on this site done that? Perhaps she's not stupid. Perhaps she just has an opinion that isn't yours.

At least we have a new rating system to distract us while we wait for whatever it is we are waiting for. Please click the down arrow on me if you are inclined to play along.

I'm going for a bike ride today. And not because I have to, either.

An excellent example of a post with an opinion that challenges my own and makes me stop and think for a bit.

Thank you for your comment. I suspect our opinions are closer together than apart, it's just that neither side seems to be able to present proof sufficient to my standards.

I just saw Melissa Francis on Bubblevision with Yergin. It was not pretty and I found myself choking now only on their discussion but my weak defense of her as well. But still, it's hard to have a baseless disagreement to a baseless argument.

Have a nice week. It's summer time.

Now see I was being nice and you come back with your hemispherist assumptions and predjudice!

It's a wet, stormy night outside... I hope you get sunburn! ;-)

it's just that neither side seems to be able to present proof sufficient to my standards.

Thus did Big Tobacco get away with poisoning so many for so long with no repercussions.

Thus has Exxon/Big Oil/BuCheney succeeded in making Climate Change seem to be controversial and unknowable.

Sometimes the worst thing a person can be is learn'ed. Discernment and insight do not come from education.


I do not see the MSM as disregarding PO today. Maybe I can't see enough of the Fox and CNBC stuff since I work out in the field, mostly. I do wonder how significant speaking to a Saudi is given the contradictory remarks linked in an earlier post with respect to the latest "propaganda", if I may, regarding their latest supposed field start up.

By the way, I have noticed that when my wells get down to about a barrel a day, they do not decline noticeably. Will the Saudi's have the same observation?


By the way, I have noticed that when my wells get down to about a barrel a day, they do not decline noticeably.

Interesting. Are these oil or water? If oil how much energy are you using to get one barrel per day?

When it's one barrel per day, it sure makes the EROEI math easier.

Those wells are on electric and the monthly electric bill through a coop is about $16 per month. Little wells like these make up a remarkable amount of the US domestic production. There is an organization which publicizes the amounts, but I can't recall the name. I'll look it up, but it is probably known to others on here. They have a bumper sticker that reads "Save our Strippers."

Edit: They make some, but very little water, and very little gas.

Actually, the fact that there is no consensus doesn't mean that you should act as if there is no consensus.

There is an optimal way to behave in our present situation.

You need to look at fields of study deliberately designed to deal with problems where the truth cannot be known. You should take a look at game theory.

the prisoner's dilemma always depresses me - zero sum game....

Actually, it is a non-zero sum game. It is depressing because the outcome is usually negative.


you seem to have a sensible approach to this: always work with multiple hypothesis, until real world data sufficiently well excludes the likelihood of most of them and you are left with one.

Yes, there is sufficiently large uncertainty and even confusion associated with some of the data.

Even more so with 'opinions'.

Based on this, I recommend for you a thought exercise that I'm playing myself.

If opinions are not backed by real world facts, discard them. Talk is cheap. Forget post-rationalizing causal reasoning and conjecture. There needs to be verifiable real world measurements and pref. also a basic theory of how the system works (that gives useful/predictable results).

If the opinion is not based on these AND esp. if the subject claiming these opinions as facts has a vested interest, I just disregard that opinion. I don't have a crystal ball, they could be right/wrong, but if they are too stupid/lazy/whatever to prove their point, I'm not going to do it for them. I will not spend too much of my time speculating if they are lying, if they are right, what are they motives, etc. I could spend a lifetime doing that and get nowhere.

As for the Saudi production boost, yes, it could happen. We don't know, because real verified data out of KSA is impossible to get.

We will see when we see.

However, one must evaluate this potential upside against known and proven downside. World current oil production capacity reduction is c. 3-4% p.a due to depletion. We need that amount of new capacity just to stay even. Also, net exports for many big regions are now in decline and there are fuel shortages all over the developing world. We don't know if these trends will continue, but even less we know that they will reverse.

These are all downside facts.

They don't require any conjecture, hypothetical thinking or forecasting.

"Everybody's entitled to their own opinion but nobody is entitled to their own facts"

The Wall Street Journal has several articles about the problems of banks obtaining more capital:

Investors Hide as Banks Come Knocking"

Financial Firms Struggle to Get Capital From Big Players Burned Once Already

"The window for capital-raising is closing," says Brad Evans, a portfolio manager for Heartland Advisors Inc., a money-management firm in Milwaukee that invests in small, regional banks. "Investing in a bank right now means investing in a large portfolio of loans that are essentially a black box."

More Bank Bailouts Ahead?

If Lenders Can't Find Buyers Or Raise Needed Capital, FDIC Could be Overwhelmed

The Federal Reserve's decision to take on $29 billion of Bear Stearns's assets may soon look like chicken feed. If problems at U.S. banks worsen, the federal government -- in other words, taxpayers -- is likely to be on the hook for sorting out much of the mess.

And on a related topic:

Capital Flow From Emerging Nations To U.S. Poses Some Risks

The U.S. has to import, on net, almost $2 billion in capital a day to cover its enormous trade gap. Of the $920 billion that foreigners pumped into U.S. stocks, bonds and government securities last year, $361 billion -- a stunning 39% -- came from emerging-market nations, according to calculations by Bank of America, using Treasury Department data.

Wonder what would happen if the citizens of those emerging-market nations had a voice in whether their savings got shipped overseas? I bet they don't believe the US is a very good investment right now - much less its Treasury.

This June 20 piece by Edward Hugh, a Catalan economist of British extraction based in Barcelona, is along the line of Gail's recent article on Hawaii. Although it has more emphasis on the finance side and less on the sustainability side (the author is not PO-aware), it shows that Spain is also a canary in a coal mine wrt PO:

The article is based on a June 14 post on the author's blog (scroll down a bit):

"the undelying issue now is basically Spain's lack of competitiveness in exports, and its very strong external energy dependence at a time when oil prices are rising substantially, and when the high price effect looks like it could be long term"

"Spain could soon become seriously short of money. At the end of the day, if you are sending money out every month to pay for your oil, where are you going to get the funds from for new lending? Desperate situations require desparate acts." (My own comment here: you don't need any new lending because you don't need any new houses, at least the current variety.)

"on top of the credit-crunch property issues Spain also has a huge CA deficit one, and the problem is only likely to get bigger if oil prices keep rising. Spain shares this CA problem with Greece (deficit 2007 13.9% GDP) and Portugal (deficit 2007 9.4% GDP) within the eurozone and these deficits have largely been masked by serving up "all eurozone" data where the large German surplus (surplus 2007 7.6% GDP) covers a multitude of sins. But German citizens are obviously NOT going to pay for Spanish oil (they may lend the money, but how long can this can continue to go up and up is anyones guess, it looks like an extermely exaggerated version of the US funding depence on Japan and China in some strange sort of way).

So the bottom line is that Spain is headed straight towards a crash on the two biggest global issues of the moment, the credit crunch and oil. The proverbial double whammy. Not pretty, which perhaps explains why the average Spanish citizen, just like Artemio Cruz, prefers to keep his or her eyes closed rather than gaze on what might be there to behold with the eyes wide open and a mirror held up to their face."

Every person I debate PO with who chant "drill, drill, drill" seem completely unaware that if oil should be produced by all that drilling said oil will be sold on the open market.

Everyone believes it's ours and it won't leave our fair land. So please correct me if I'm wrong, but won't said oil be sold on the open market to the highest bidder?

A better way to say this is that the oil will be offered on the market at the going rate. It may stay in the US, but it will be priced by the oil markets.

That still doesn't answer an important question because the debate is primarily about being less dependent upon foreign sources of oil. And it does matter, anyway, because of the potential impact on the trade deficit.

There was a similar debate when they were opening up the North Slope of Alaska and I am not sure whether or not that was either definitely resolved. In any event, this isn't likely to do very much to lower oil prices and won't kick in for about ten years.

IIRC, there was a limitation on North Slope production imposed in the 1970's which outlawed export of that oil.

woodychuck writes:

IIRC, there was a limitation on North Slope production imposed in the 1970's which outlawed export of that oil.

It will be interesting to see if that also applies to new drilling in the US. Also I image that if the producer pays for freight (FOB) they'd want to sell it to the closest buyer. That would mean the US.

Actually, Japan is about as far away as Southern California, but the US West Coast could not, once upon a time (before SUVs and depletion) absorb all of the North Slope oil and some of it had to go in small US flag tankers through the Panama Canal and into the US Gulf Coast.

This depressed the price for all of the North Slope oil. Selling a % to Japan could have raised the overall price by an entire $1/barrel (back when that mattered).


Everyone believes it's ours and it won't leave our fair land. So please correct me if I'm wrong, but won't said oil be sold on the open market to the highest bidder?

Not necessarily. If the extractor of the oil also operates a refinery then it is cheaper for them to refine their own oil (they have only to outlay the cost of production) than it is to buy oil on the market and refine that.

I posted recently the idea that the market price doesn't represent the value of oil, but represents the value of "surplus" oil. That is, you use all of your oil that you need before you sell any to the rest of the world. This is basically the same idea expressed in the Export Land Model.


There does seem to be an unstated (and untrue) assumption, that since it is "our" oil, we can sell it to ourselves at a large discount. The effect on the trade deficit depends upon who captures the price paid for the oil. Presumably this will be shared by employees, shareholders, and perhaps the government. To the extent that these groups are located within the country, the domestic economy is helped.

There does seem to be a large psychological and political mandate, that we not export it. But economically such restrictions can only decrease the efficiency of usage.

I wouldn't bet on it-currently we have Iraq as an example. The USA taxpayer has spent a fortune to seize Iraqi oil for the large multinationals. There has not been a clear return on investment as of yet, there might eventually be, there might not be.

The funny part is how we won't call it a "subsidy" or "handout" the way we do when Venezuela does it.

The Bright Side to High Oil Prices

"Nothing new has happened in the past 12 months in terms of supply and demand that could justify a 100% increase in the oil price."

What? Is this guy completely deaf and blind?

Why is it that I see all these monumental changes going on around me, and he sees nothing?

Let's take a look at just a few of the things that have changed in the last year:

☺It has become evident that Mexico's production is in a sustained, irreversible decline

☺It has become evident that North Sea production is in a sustained, irreversible decline.

☺Russia's production has plateaued and in recent months has began to decline.

☺As these very words are being typed, the leading news story is that it is much less clear (could we even hazard to say that it is incresingly doubtful?) that Saudi Arabia can increase oil production. Face it, the only substantive thing Saudi Arabia did over the weekend was to let a big fart.

☺Oil exporting countries have become much more defiant, stating in no uncertain terms that they will produce their oil when they want to, on their terms, and how they want to.

☺The United States has finally started to respond to higher gasoline prices. Miles driven and gasoline consumption have started to level off and decline.

UK: Inner city flat prices fall sharply

Prices of new-builds in city centres have collapsed, with many sold at auction for a fraction of their value only two years ago.


This looks odd at first sight, as it is the exact reverse of what would be expected from rising transport costs.
Most of these are rental properties though, and in the UK most city dwellers can get into work by public transport, even if with some difficulty and expense.
At this stage property price falls are the result of a fairly conventional credit crunch at this stage, and the rise in petrol prices has been a lot more modest proportionately than in the US due to high taxation.
Perhaps as high energy costs bite and smaller, easier to heat modern premises which also minimise transport costs might be the first to rise, relative to other property prices at least.

It is difficult to see how they could continue to sink more than bigger, less central and draughtier properties anyway.

Blair and co pushed development of high density brown field sites as a housing 'solution'.

Developers saw the opportunity to put loads of flats on the sites of older housing, calling them something stylish, pricing accordingly and raking in large profits.

Fast forward to now.

BTL landlords are beginning to get hit by margin calls, having to sell.

Most people don't want to live in one or two bedroom poky flats, the aim is still the three bed semi. In addition the market is awash with them after the boom in building. When the market was going up people bought 'to get on the ladder'. Now they don't want to know and if last time is anything to go on soon they will be bypassed as prices fall and people go direct to the 3 bed semi stage.

All of which means there will be some real bargains on the flats market in two or three years, just as transport prices really bite. Some creative and in the know people could make a killing...

RE: Dr. Hansen -- prosecute oil companies -- article above in DB list.

What a great voice! Hansen is right on target. The oil industry as a whole has behaved just as "Big Tobacco" behaved all along, with criminal intent and effect: making money from deadly products while lying about it.

Big Oil makes Big Tobacco look like small potatoes. Big Oil has devastated the planet's health as well as our own.

We've made air, water, and soil toxic to the very web of life that makes our own niche in the biosphere possible. It will take a massive effort to salvage a place for a remnant of the next generation to live.

We need to understand the implications of the lies we've been told so that we can make changes to avoid making things even worse, and to try to help adapt to the toxic environment we leave behind.

This starts with a full-on look at the criminal lies told to us to keep us from making the necessary changes for the last three or four decades.

An hour-long interview with Dr. Hansen just wrapped up on the Diane Rehm show. It will be available on line in an hour or so at wamu.org.

"Big Oil makes Big Tobacco look like small potatoes. Big Oil has devastated the planet's health as well as our own."

What a line of garbage, people chose to smoke, and people chose to drive....neither tobacco or oil is the first substance to be discovered harmful after widespread adoption. Blaming your forefathers for making your life easier than theirs is just silly. There are alot of toxic chemicals in a computer, but I see you don't obstain so you're just as guilty as "Big oil" and the rest of us.

If you have two feet, you can walk or ride or horse so there is your alternative. The thought of punishing everyone who gave you free ride from reality is just plain ridiculous. Life is hard, and not fair, perhaps you should get used to it and accept some personal responsibility.

I imagine your attitude will change when you are starving and freezing in the dark. Perhaps then you will understand why your grandparents were grateful to have oil and electricity.

...when you are starving and freezing in the dark. Perhaps then you will understand why your grandparents were grateful to have oil and electricity.

jrc9596 - I was pretty much with you until your last paragraph. You made a leap in logic that simply doesn't stand up to scrutiny. People don't starve because they don't have oil and electricity. Nor do they freeze for that reason (in fact, a huge portion of the world lives in places where freezing isn't a concern).

I generally agree, however I do believe the oil companies should be held accountable for deliberate lies. Oil companies are not required to lie about AGW or PO. They could conduct their business perfectly well and be truthful. To the extent that they lied, and the lies caused material harm, they should be liable for damages, just like any other company.

"To the extent that they lied, and the lies caused material harm, they should be liable for damages, just like any other company."

I don't think they lied, they just said what they believed to be true. Liable for damages? What damages? Oil spills and ground water problems are the only thing I can think of that would be that would be their fault. That they should pay for. Open the door to lawsuits for other damages and you'll just put them out of business or they'll stop doing business in the states. Talk about creating an instant Mad Max scenario or survialist fantasy, that would do it.

Please educate yourself. The Fossil Fuel Industry has purposefully funded those enterprises who have conducted widespread AGW denial campaigns. Many of the same actors involved with denying the harmful effects of tobacco are involved with AGW denial, people like Singer et al.

Since you are touting the AGW-denialist line, I would have to ask: How much are you getting paid or are you working Pro Bono?

don't think they lied, they just said what they believed to be true.

That's why I used the qualifier "to the extent they lied". If they honestly believed what they were saying, then there is no liability.

As for putting the oil companies out of business creating a Mad Max scenario, I don't think so. Is Russia having a Mad Max scenario? Or Venezuela? The IOCs are dinosaurs. The sooner they are gone, the better. To the extent that oil is on private property, I don't care who pumps it. But oil on public property should be controlled by the public through contracts with oil service companies. In other words, the oil companies should be paid for services rendered, not granted a percentage of profits.

If the IOCs have done the same sort of things the tobacco companies did, they should be held accountable. If that causes them to go out of business, then it just means the US will manage its energy resources the same way most of the rest of the world does.

There will probably be some criticism of Dr. Hansen's call to prosecute the oil companies at The Oil Drum, on the grounds that they do indeed have to have a profit motive to drill, and on the general squirreliness of the concept of a "windfall profits" tax.

Fair enough. The thing that needs to be investigated is whether that windfall is a result of happenstance, or of a crisis that a competent resource extraction industry should have foreseen decades ago. If the latter, then the industry's conspiracy of silence about the risk of peak oil was a criminal act.

If that conspiracy included the President or Vice-President, then it meant that during 2000-2003, when the public and Congress might have been informed about the need for greater conservation and (to pay for expensive fuels) personal savings, we were being led into a corner from which the invasion of Iraq and Iran would be the only attempted solution, while the President's oil industry donors obtained maximum benefit.

I still want to see that Cheney energy task force documentation.

I was thinking more along the lines of the Canadian PM's remark about "freezing in the dark", but you're right it is bit of a reach. That being said, I wouldn't want face life in Minnesota city during the winter without electricity. The country folks will be fine since they have woodstoves, but without wood it would be pretty rough. Sorry if that came off a little abrupt, I lose my cool when people try to blame everyone but themselves for things like this. Our forefathers gave us a world full of wonderful technology with sometimes harmful side effects, but hindsight is 20/20 and I'm sure that if they would have known that we would turned out to be such ungrateful spoiled brats they wouldn't have bothered feeding us at birth. I'm sure the primary engineers behind TV have plenty of regrets.

I think all of us would like to see the task force notes, but without access to the official Opec reserve data how could they make a legitimate guess as to flow rates/reserves. My guess is that until Cheney's task force, noone every really thought about the big picture because they were too busy running their companies etc.. Considering the national/strategic interest is the government's responsibility, ie the energy department, I don't see why a private company should be concerned with this. Peak Oil has been known about by the CIA for a long time, so noone in the government can plead "we weren't warned". Someone has to have been studying this for a long time, Tom Whipple immediately comes to mind but I'm sure he had a successor.

As far as blame, I would like a refund on the salaries paid to the Dept of Energy/IEA the last 6 years because they clearly haven't been doing their job. I hold them responsible, not Big Oil whose main job is to make money and not spill anything.

Hansen's call to try the CEOs of Peabody and Exxon-Mobil has nothing to do with windfall profits but rather the deception used be these people to hide their funding of a disinformation campaign on global warming. http://dotearth.blogs.nytimes.com/2008/06/23/are-big-oil-and-big-coal-cl...


So Hansen wants to repeal the first amendment because well-funded people are arguing with him and have won some debates? And you wonder why some people question the scientific objectivity of him and his adherents, when he wants to criminally prosecute those with opposing viewpoints. The IPCC itself was very equivocal in the early reports, and somewhat equival until the latest edition.

Uh, there is no such thing as the first amendment in Science. However if you are referring to astroturfing, PR campaigns etc then you may have a point. I certainly think that those that funded PR campaigns to deny AGW, should have some accountability for the consequences of their actions - namely purposefully avoiding timely interventions to AGW.

Its all very well saying that its your right to dissent, but there are limits. Its like not shouting fire when you see smoke because you cannot see fire.

"I certainly think that those that funded PR campaigns to deny AGW, should have some accountability for the consequences of their actions - namely purposefully avoiding timely interventions to AGW."

There certainly is a first amendment in Science, say whatever you want but prove it. Global warming has been adopted by the publicity hounds in search of a Nobel Prize and unfortunately, has taken the tone of a religious crusade and anyone who goes against the "group speak" gets dragged through the mud. Kinda like anyone who doesn't like Obama is called "racist", even if they couldn't care less if he was purple.

Despite what some think, science is never settled, neither Sir Issac Newton nor Einstien ever said the "debate is over, we know everything". Research the Uncertainty Principle, which means there is always a chance you have no idea what's going on. Considering the planet is a very complex system there is a decent chance we don't really know what's going on since the models being used aren't very old.

You want a mitigation plan? Move away from the coast, plant a garden and don't invest in insurance companies. What else are we going to do? Ideas like seeding the oceans have Unintended Consquences written all over them. Its best just to roll with it because the FF are halfway out the door anyway.

Researching the "uncertainty principle" might reveal to one that there's a limit on the joint precision of noncommutating quantum variables (or indeed classical noncommutating variables), not that "there is always a chance you have no idea what's going on". If you're going to try and use buzzwords it helps to use them in roughly the right way.

(I'm not weighing in either way on your larger debate.)

You're right, I was thinking on the system level instead of the individual variables, but for a system the size of the planet a small change in a bunch of individual variables results in an extra large change in the system output response.

You don't know what you are talking about with the Uncertainty Principle or AGW. Please do not repeat the lies you have been told.

Chaos/Complexity Theory (which is what you seem to be trying to talk about) have nothing to do with the Uncertainty Principle. Of course, given the context of your initial statement you might be thinking of Godel's Incompleteness Theorem.

Your post is both confused and confusing, like most AGW denialist scribblings.

My point about scientific speech is the same one you pick up on - you can say anything, you just need to provide a rational hypothesis (you mention proof - you're confused, again) as a framework for the statement. A some point you will need to develop your hypothesis into a theory with supporting evidence and some powers of prediction.

On the other hand, you have a set of entrenched powers that have NOT developed a scientific theory, who do NOT publish peer-reviewed papers and who are acting in their OWN monetary interests. On one side you have a scientific community and on the other side you have economic interests. Sure, the moneyed interests will win out in the short term, but nature will win out in the end. Earth abides.

Now your statements about settled science - that's just bunkum. And the Uncertainty Principle has absolutely nothing to do with this at all. The AGW theory is extensively researched and each of the fields interlock with the findings from other fields. So dendochronology ties with paleogeleogy with ice core samplings. Botanical observations match Zoological findings which match with long term oceanological finds. When you have a theory like AGW that agrees across so many fields of study and research then you have a compelling body of evidence. So if the experts in their fields are compelled but you are not, that simply means that you are not an expert and your *opinion* can simply be discounted like a flat-earther, intelligent designist or a phrenologist.

So, unless you can point to a set of compelling evidence, you can simply step off the soapbox, because in the realm of science you DO NOT HAVE a 1st amendment right to speech.

"In questions of science, the authority of a thousand is not worth the humble reasoning of a single individual." -Galileo Galilei

Copernicus' Corollary: And yet, if a thousand humble researchers agree upon a single thing, then we can reasonably expect it to be true.

Thats what is so hard to convey to the poorly educated - until the AGW theory gained its pre-eminence, it was the underdog. Arhennius was widely ridiculed, and yet the body of evidence has grown and has provided multiple reinforcing lines of argument toward a SINGLE point of argument - Humanity is singulary responsible for the rise in CO2 and that rise in CO2 has an effect on our climate.

That awesome. I will be bookmarking that!

"On the other hand, you have a set of entrenched powers that have NOT developed a scientific theory, who do NOT publish peer-reviewed papers and who are acting in their OWN monetary interests. On one side you have a scientific community and on the other side you have economic interests"

To my knowledge, the discussion about the AGW issue is far from being one of science-on-one-side vs economic-power-on-the-other, because there exists significant dissent in the international scientific community with the predominant view on AGW. It is best reflected in the open letter by 100 prominent scientists to the UN Secretary General dated Dec. 13, 2007:

Some of these dissident scientists propose that an important factor in short term changes (in the order of decades) of global temperature is the variation of solar irradiance modulated by the short term (11-year) solar cycles. If this hypothesis is correct, and the solar cycle 24 that started in Jan 2008 and the next are weak as some forecasts indicate, there could be considerable cooling starting in the next decade (certainly not a fully-fledged Ice Age, but in the order of XVII-century Little Ice Age, whose deepest trough coincided with the Maunder Minimum of solar activity, which of course does not prove causality but suggests it.)

A couple of these scientists are:

Roy Spencer (Ph.D. in Meteorology, principal research scientist for University of Alabama in Huntsville, and one of the 100 scientists that sent the Dec 13, 2007 letter to Ban Ki-Moon)

Nicola Scafetta (Ph.D. in Physics and Research Scientist at Duke University)

Additionally, the following study shows that the predictions of current climate models regarding vertical temperature gradients are completely at odds with observations:
Douglass, D.H., J.R. Christy, B.D. Pearson, and S.F. Singer. 2007. A comparison of tropical temperature trends with model predictions. International Journal of Climatology, DOI: 10.1002/joc.1651.
(The author is Douglass but the filename has Dougless.)

Finally, one of the authors of the above study, John Christy (Ph.D. in Atmospheric Sciences, Professor of Atmospheric Science and Director of the Earth System Science Center at the University of Alabama in Huntsville, Fellow of the American Meteorological Society, member of the Intergovernmental Panel on Climate Change (IPCC) wrote IMV one of the best summaries of the whole issue on November 1, 2007:

There's certainly scientific uncertainty (and to my mind very little attention paid to the decision theory aspects of the problem), but it's worth remembering one of the 100 "prominent scientists" is Dr Lubos Motl. You can draw your own conclusions about his accuracy in impromptu climatology and which of his views stem from ideological convictions:


(He redacts some of his most offensive ad hominem attacks and obvious calculational errors once they're noticed so the historic archive isn't truly representative.)

Some people on both sides of the issue are approaching the issue with an agenda.

There is very little dissent within the scientific community QUALIFIED in the relevant fields.

In a survey of CLIMATE scientists (and not by any left- or enviro- leaning organisation either:

Eighty-four percent say they personally believe human-induced warming is occurring, and 74% agree that “currently available scientific evidence” substantiates its occurrence.


I actually looked at Nicola Scafetta's webpage,

Sun and Global Warming

Finally, our study focused on developing a phenomenological multiscale model to estimate the solar contribution to global warming during the last century. Current energy balance climate models seems to underestimate the solar impact on climate by 1.5-3 times. It seems that the increase of solar activity during the 20th century might be responsible of approximately 50% of the global warming, but this contribution was not uniform during the century. The sun might have contributed 75% of the global warming during the first half of the century (1900-1950) but only 30% during the second half of the century (1950-2000). Thus, our findings would confirm that the sun played a dominant role in climate change in the early past, as several empirical studies would suggest. However, anthropogenic-added climatic forcing might have progressively played a dominant role in climate change during the last century and, in particular, during the last decades.

So it appears that he does *NOT* deny AGW. I will bet that most of the publishing climate scientists on your list are of like mind.

By citing that "list of 100" you have become a case example of what Dr. Hansen speaks - namely, you've been influenced by an effort to obfuscate the reality

For example, by citing Dr. Spencer, you must not be aware of the controversy around him and some of his previous work, or his castigation from the larger scientific community for his views on Intelligent Design.

By citing S.F. Singer you show that either you are not aware of his own very controversial past, or are supporting it.

Overall, it is also clear that when several of these critics have been pinned down by honest climate scientists regarding the effect of adding CO2 to the atmosphere the inevitable (because it is well understood physics) is that the net effect is of raising the energy (and thus the mean temperature) of the Earth's surface. However, you will not get that from reading the one page adverts placed in papers such as you have quoted. Why would they hide that from you?

Again, your citation of that letter/advert shows that you are indeed the victim of what Dr. Hansen speaks.

because there exists significant dissent in the international scientific community with the predominant view on AGW.

Wow! You have a letter from a bunch of people paid to lie or to reinforce their own delusions? Great!

... but, silly me, I thought this was about science... I see you've got none to share... what a shocker!

For chrissakes...


See all that dark blue? That's open water. See all those lighter shades of blue? That's all semi-open water/melting ice. Open up the hi-res version... note all the blue at the North Pole region...

The following news should be a real "gas"...





The only reason corporations are considered to have any right to free speech is because they are considered persons. This was not the case when this country was founded and rests on very shaky legal foundations springing from a later court case. Corporations have used free speech (Nike) to squelch criticisms of their labor practices. This, while not technically criminal, should be.

We cut it close a few years ago when the beef growers tried to sue Oprah for publicizing allegations about their product. If it had been an actual journalist the beef guys probably would have won.

One day a president will simply proclaim that since America's economy is a giant stock bubble, any public criticism of any corporation could potentially cause a stock market crash, which is as much a threat to national security as any act of terrorism, ipso facto it will be forbidden. I'm sure the White House's Council on Competitiveness or whatever it's called has already made the argument.

If you think about it, claiming that countries have the right to go to war if their survival is threatened practically guarantees that some country will intentionally stake its survival on high-risk, high-profit financial scams and overseas deals, then threaten to bomb any state that does not cooperate.

"National security" and "survival" are so closely tied to growth & compounding profits now that it's only a matter of time when we must chose between them and liberty, or even peace.

Intentionally lying for financial gain at the cost of others' health and/or lives is not covered by the 1st Amendment.

If it were proven they knew Climate Change was real, but didn't think anyone would die, then they could be charged for manslaughter or negligent homicide, I suspect. If they knew the real effects (and how could they not, so strenuously arguing agains them with lies?) then they could be charged with murder/crimes against humanity.

BuCheney, also, as they have actively done just as Exxon has done, and in tandem. This is yet another impeachable offense. Funny thing is, to know they were lying all you need to know is one simple thing: What kind of house does G. Dumbya Bush live in?


JH Kunstsler in his latest post on Clusterfuck Nation references The Oil Drums Jeffrey Brown: "As Jeffrey Brown has pointed out on THEOILDRUM.COM, the Kingdom will still show a steady three-year decline over their 2005 production rates even if they're able to goose current output as much as they say they will in 2008."


He was also derisive of the Katy Couric (MSM) disconnect which sees rising oil prices as a lifestyle issue.

Another classic from JHK-the womens pages comment was right on.

I did not see these referenced.

A tip-of-the-hat to westexas - and TOD - from JK!


Also on the "meanwhile" front, the OPEC meeting Sunday at Jeddah, Saudi Arabia, was simply a desperate dodge, a mummery, a kabuki theater of powerlessness. Once again, the Saudis are pretending that they can increase their production -- in essence, pretending that they actually have some power in the game. As Jeffrey Brown has pointed out on THEOILDRUM.COM, the Kingdom will still show a steady three-year decline over their 2005 production rates even if they're able to goose current output as much as they say they will in 2008.

Also, a curious quote from Denninger I believe has been echoed here from time to time re: oil as currency.

Boom-Boom Monday

There was a monstrous spike downward in gold prices at about 7:15AM. There's no official news on what caused it, but the rumor is that there was a forced liquidation of a hedge fund. They sold their gold but held the oil.

Why is this important? Because it tends to ratify what I have been saying, which is that oil has turned into a currency. Why? Because it has utility value - it is stored energy and cannot be debased.

it is stored energy and cannot be debased.

Seems fewer investor/purchasers are drinking the Kool-Aid these days and will go ahead and bid the BTU's instead of the 'other' purveyors of wealth. (bailing out by rolling into oil) Up again today despite tamping speculation, China hikes, KSA promises.

With comments out of this latest summit like KSA being "the Federal Reserve of Oil" and this Saudi prince talking about "structural changes in how economies function"
methinks that the Bakhtari T1 shift is in full swing.

We have indeed been saying around here for some time that oil is a currency. Perhaps it could be said now that it is fast becoming THE currency.

This is only tangentially related to peak oil, but I thought I'd post it since we do discuss climate change, sea level rise and apocalypse here occasionally:

Ebb and flow of the sea is the primary cause of the world's mass extinctions over the past 500 million years

But a new study, published online June 15, 2008, in the journal Nature, suggests that it is the ocean, and in particular the epic ebbs and flows of sea level and sediment over the course of geologic time, that is the primary cause of the world's periodic mass extinctions over the past 500 million years.

"The expansions and contractions of those environments have pretty profound effects on life on Earth," says Shanan Peters, a University of Wisconsin-Madison assistant professor of geology and geophysics and the author of the new Nature report. In short, according to Peters, changes in ocean environments related to sea level exert a driving influence on rates of extinction, which animals and plants survive or vanish, and generally determine the composition of life in the oceans.

Better hope those ice sheets don't melt... Oops.

*edit* (Incidentally, I'm not so sure I believe this -- that crater in the Yucatan is pretty convincing. I think it's an interesting idea but I think that NSF is doing what most science reporters do, which is blowing it way, way, way out of proportion and exaggerating the claims of the author. If you read down near the bottom of the article, the author does actually say that he's not suggesting that sea level rise and fall is not the only possible extinction mechanism.)

Like other things, it may be a positive feedback on other conditions. For example, with the asteroid hit on the Yucatan, the heat from that could have led to unexpected melt (if there was ice then, which I believe there was), thus adding to the troubles of organisms not in the blast zone. One would be able to argue this chicken-and-egg.


Business News Network, a Canadian cable news channel carried an interview that sited the Oil Drum commentary that responded to the weekend meeting in Saudi Arabia. The commentator repeated that while an announcement was made of a production increase, the overall production level was no higher than it has been in a while. The obfuscation of what is being reported was also noted.
Not news around these parts by any stretch of the imagination, but a pretty clear kudos to the contributors here at the Oil Drum.
Great work guys!

It is proving a very difficult project to teach the American people that when it comes to the House of Saud, just watch what they do, not what they say.

It will take the work of many to hammer this lesson home.

I think that works well beyond the house of Saud.
Talking to an economist who is certain that the current oil price is a bubble.
Are you sure? Absolutely, you will see, there will be a major correction soon.
You know, the Saudis are not the very transparent with respect to any production issues...
He totally agreed.
So the first sign we would have that a decline is imminent would be the price going up...
Again he agreed.

I left it at that, I enjoy cognitive dissonance. Other peoples cognitive dissonance. :)

Thanks for all of the kudos folks. This wouldn't happen if you all a) didn't come here to hang out and teach and learn and b) help us spread our work around.

That's why we hit the spreading of stuff, reddit, digg, etc., so hard. We know it's asking a few moments of your time, but it really does help. It gives more people the chances to get here, and it really helps our ad revenues in the sidebar too.

I was helping you spread the word professor G, but I can't help ya anymore until someone takes the duct tape of my mouth and lets me participate in the forum.

Antidoomer, who is taping your mouth shut?

Your mouth seems to be working fine, AD. What duct tape is that?

The fact that you get roundly criticized for posting the way you do is surely 'participating in the forum', while your end of that discussion seems perpetually immune to a reasonable level of 'Internal Negative Feedback', so others provide a disproportionate amount in 'equal and opposite reaction'.

Unless I missed it, Have you been banned?

Please pay attention to the feedback, not the green numbers, the actual comments.. I try to be constructive with mine so that someday you'll take a few hints on how to make your contributions part of a more TWO-WAY conversation.

Many people on this forum are not unequivocably opposed to 'optimism and hopefullness', and looking at helpful tools, but not when it's running blindly at full tilt, which is how much of your writing/linking comes off to me and others..


He had a post repeatedly deleted which linked to some reporter going OMG it's AMAAAZING over some brilliant ALL NEW technology...

It was a parabolic mirror for concentrating sunlight... IT COULD MELT STEEL!!!!11!eleven!!

To be fair, what was clever about it was the modularity of the system making it affordable, but the lengthy article AD linked didn't even mention that aspect, other than perhaps, this memorable quote:

a dish the size of the RawSolar team's design costs only a third of what a larger dish would cost

Perhaps had he dug around for a while, and pulled up this link instead, his post might have stuck around...


MIT Sloan School of Management lecturer David Pelly, in whose class this project first took shape last fall, says that, "I've looked for years at a variety of solar approaches, and this is the cheapest I've seen. And the key thing in scaling it globally is that all of the materials are inexpensive and accessible anywhere in the world."

Pelly adds that "I've looked all over for solar technology that could scale without subsidies. Almost nothing I've looked at has that potential. This does."

Thanks for the explanation, Jaymax.

Now I hope your post doesn't get deleted, while I doubt it would, since you put the report of HIS link into context that can be discussed, etc..

I'm sure it's frustrating for him to get so much guff, but what would you expect?


I hope he reads and learns from this. Having someone on the site who is so dedicated to bringing us news of all the small techno advances is a GOOD THING. But the way he goes about it, with so little consideration, counteracts any value he might otherwise bring.

This is a perfect example. When I saw the article, I thought "what is WITH this reporter, is he/she just going gaga over one of the students or something?" but ALSO - "if MIT students have done something that results in press interest, then there's probably a real story somewhere."

It took me about 10 minutes on google to find a relevant link that satisfied my curiosity, and (hopefully) worthy of TOD drumbeat... When this subthread appeared it seemed sensible to share it.

It's just lazy and rude of AD to post the kind of twaddle of the initial link.

It's just lazy and rude of AD to post the kind of twaddle of the initial link.


Especially since, if I let him, he'd post a dozen such links, many previously posted, at the top of the DrumBeat every day. Which would then attract dozens of replies telling him how stupid he is. It gets tedious fast. All noise, no signal.

However, I'm willing to make him a deal. Pick ONE of these "somebody's science project" type posts per day, and post it after 11 am eastern time, so it doesn't derail the DrumBeat into stupidity.

Talking about letting a big fart, after all the hyperbole about how shale and other resource plays were going to unleash untold amounts of new production, have you seen what's happening to the Barnett Shale?

Newark, East (Barnett Shale--Monthly gas well gas production

Jan 07 70.0 BCF
Feb 07 65.3
Mar 07 75.4
Apr 07 75.2
May 07 80.4
Jun 07 80.0
Jul 07 84.3
Aug 07 86.6 Number of wells = 7787
Sep 07 83.7
Oct 07 86.5
Nov 07 81.4
Dec 07 80.1
Jan 08 76.8
Feb 08 68.8
Mar 08 69.8
Apr 08 63.7 Number of wells = 8002

(Source: Texas Railroad Commission)

That's a whopping 26% decline in only 8 months!

The production will probably level off at about 24 BCF per month after a couple of years, but this points out just how treacherous producing from this poor reservoir rock can be.

This the "Red Queen" problem--running faster and faster, in order to stay in place. The problem with increasing total oil & gas production from unconventional sources is the vastly greater requirements for capital, personnel and equipment of all types. What unconventional production will allow us to do is to slow the rate of decline of total production. And one more time, the fact that oil & gas companies can make money (and provide jobs) in a post-peak environment does not translate into making a material difference.

A lot of the Barnett Shale acreage (and specifically acreage in Wise County) is undergoing a major change. Wells originally drilled on 160 acre spacing had the spacing requirements reduced several years ago, and current actions before the Railroad Commission of Texas are seeking, and getting, 40 acre spacing according to my attorney in that area. While this will increase the production, and will increase the ultimate recovery, it is at great capital expense. This will accomplish better drainage of the acreage, probably shorten the time which is required to get that production, and is only justifiable by the present value of a dollar - A dollar today is worth a dollar and tomorrow it is not.

The annualized net decline rate, from October, is about 60% per year, with more wells on line.

Did you all hear PG on NPR's All Things Considered on Saturday talking about China?


"All Things Considered, June 21, 2008 · China, the world's most populous nation, also holds the top spot in another category: carbon dioxide emissions. That's partly because China produces and consumes more cement than the rest of the world combined. Kyle Saunders, a professor at Colorado State University and editor of the energy blog "The Oil Drum," talks about how cement production relates to global warming."

Cement post was here: http://www.theoildrum.com/node/4162

I'm not sure if this story got posted yet (apologies if it already has - no time this morning to read all the posts):

Sen. McCain offers $300 million prize for new auto battery

My opinion - a great new auto battery would be nice, but hardly necessary. Existing nickel-metal hydride batteries are adequate (if not perfect) for producing plug-in hybrids or even all-electric cars. The $300 million subsidy would be better spent in kick-starting a light-rail program. If McCain wants electric cars, how about supporting a law like California had in the late 1990s (before it got nullified) that required an increasing percentage of cars sold to be all-electric. Or maybe he should just spend a few dollars at Netflix and order the movie "Who Killed the Electric Car?" - he might learn a few things.

WKtEC is one of the best docs ever made (right after A Crude Awakening)...

www.SonyClassics.com/WhoKilledTheElectricCar and www.WhoKilledTheElectricCar.com

Well the people at blacklight power were claiming they'd have a battery the size of a briefcase to provide power for 1000 miles, so no prize is needed.
(That battery ship date was going to be in 2007 when they got press in 2001)

I think that McCain has it right. I had a previous post advocating that the US set up a scientific panel that would identify, e.g., 250 different prizes at any point in time, for important energy related inventions with about a $100 million prize for each. And, although it pains me to say it, fund the prizes from a conventional energy tax.

The best thing that ever came out of the California mandate was not the GM, but the cars from Solectria and AC Propulsion, which pushed nickel-metal hydride performance to a remarkable level before Chevron shut down the development of large NiMH batteries. I don't see any electric for sale today that is any better than the Solectria Sunrise or AC Propulsion's Honda Civic conversion. That's 10 years we've lost.

Regarding ..

Sen. McCain offers $300 million prize for new auto battery

lifepo4 batteries are here and may come down with mass production but will still be too expensive for most folks.

Again ... offering a technological fix that not enough people can afford to make a difference

ALSO ... Why is Sugar rising more steadly than anything else


MarketWatch is currently running the large headline "Could gas fall to $2 a gallon?" with the tag "If Congress acts to curb market speculation, crude may fall to $65 a barrel and gasoline to $2 a gallon, according to analysts."

Looks like things are setting up for either a huge blow to the peak oil movement (if this were to come to pass) or a huge disappointment and backlash (if it doesn't). But could you blame Congress for not trying, with constituents screaming at them every day? Don't they need to look like they're taking concrete action? How does this end?

Well, if they can do that, I hope they will also use their powers to make my little dog fart rainbows, too. We could use a little color around my house...

Looks like the Iron Triangle is working hard:

"Could gas fall to $2 a gallon?
Analysts tell Congress speculators have doubled the price of gasoline"


How about some discussion of the role of speculators? Seems like a very Ameri-centric view. Also no one seems to believe the explanation of speculators not effecting the market that Rick Santelli offered on CNBC last week.

As noted up the thread, expect to see a parallel increase in delusional thinking, as oil prices increase.

The ironic thing is that if you could manipulate the price down to $65 it still wouldn't increase supply by one drop, in fact it is likely supply from OPEC would contract dramatically in self-defense. Meanwhile, all alternatives would now be in trouble and in a very bad competitive position. Not to mention the gutting of the profits of one of the few sectors of the S+P 500 that is still profitable. OTOH, if Rick Masters says do it, it must make sense. He was great in To Live and Die in LA.

Bingo!! Someone in a position of power, somewhere, please stand up and tell the truth. We need these high prices. And besides, which was admitted on CNBC this morning, if we shut them down in the U.S., they will just take their money elsewhere. The so called problem, which I call an opportunity, cannot be solved. If you cannot increase supply or reduce demand, then STFU.

Oh, let's bring the price way the f**k down, so we can increase our consumption and become even more reliant on OPEC.

"Get that price down and all will be well."

Isn't it incredible that they think price is the problem? Price is but the symptom.

Does anyone know where I can find a version of todban that works with the current incarnation of TOD? The version I'm using is unpredictable in who gets filtered - it takes out huge swaths of messages.

Firefox 3.0.

Are there people that still use it? I had no idea. I quit using it after our famous three got banned (a couple of weeks after I wrote it).

It's summertime and I have RL things to take care of, but I'll try to have a look at it.

Some Drudge Report headlines, from just today:

2,500 people line street in Milwaukee for food vouchers; crowd becomes unruly...


Fuel Costs May Force School Kids To Walk In DC Suburb...


CITI to Slash Investment Banking Jobs World-Wide...


Good thing they bought a big one then...

David Roberts over at Grist points out that the Mustache kicks ass today. Roberts says of Friedman:

He says it's "hard for [him] to find the words to express what a massive, fraudulent, pathetic excuse for an energy policy" Bush is backing, but he manages fairly well. Extra kudos for highlighting the absurd refusal of Republicans to renew the PTC and ITC.



I will never understand the logic of "offshore drilling won't completely solve the problem, therefore we shouldn't do it". That's like saying "going to the gym today won't make me lose 30 pounds, so I shouldn't bother".

How is that useful? Yes, we know it won't solve the whole problem, but it is better than not doing it.

Because it's being represented as solving the problem, and is a distraction from what we need to face up to.

It is not necessarily better than not doing it. To develop your lame analogy, let's say you're 100 pounds overweight, continue to overeat cheese doodles and big macs, but go to the gym and feel good about it. Right up until your fatal massive heart attack.

First of all, I didn't think the analogy was so lame, but to each their own.

I know that demand reduction is where the big savings are. But I still don't see the practical logic of continuing the ban on offshore drilling.

More so than the practical issue, I think a huge political opportunity was missed by the environmentalists. Two years ago, they could have probably negotiated big efficiency/conservation measures in a bill that would allow OCS and ANWR drilling. Now they may have lost the opportunity and may be forced to accept the drilling with little demand legislation.

Well, I think the analogy is instructive if you add my piece. :-) But to each their own, indeed.

It doesn't matter what the environmentalists want - it's all going to be drilled one way or the other. Environmentalists have no power at all in a down economy.

Taking care of, or indeed even thinking about, our environment seems to be considered a luxury for good times. I feel certain that as the economy goes down the toilet, we will eat the planet, and there's nothing anyone can do about it.

Oh well.

Put aside the fact that drilling off shore is presented as some sort of cure all and is a distraction from the fact that it will do next to nothing with respect to delaying the peak.

The fact still remains that this very shaky enterprise requires billions of dollar worth of investments in an era where we are running out of time to address the necessity of conserving and moving away from oil and fossil fuels in general. The oil companies don't own the ocean; it is part of the public domain. As such, the public as represented by their government has a say in how and when those public areas are exploited. Given the myriad of other investments possible, is this really the best use of billions of dollars in capital, the product of which will eventually be burned up and lost forever. The oil companies and their supporters would maintain that it is none of the public's business. I think it is and I don't think this investment is the best way to transition us to a post oil and fossil fuel future.

We don't know with a high degree of certainty if a low carbon, low consumption, renewable future is possible. But we do know that the amount of oil available to us is declining and will probably decline more rapidly in the future. We should take our chances by investing in a future that will make us less reliant on fossil fuels.

On a personal level, I am using my limited capital to go after low hanging fruit like insulation. Or I could just put my money in the bank and take my chances with propane prices next winter. Yes, I will still need to be dependent upon fossil fuels. But it's a start.

"But I still don't see the practical logic of continuing the ban on offshore drilling."

Well one angle to consider would be that what remaining fields we have should be held onto as an extension of the SPR, and only doled out VERY carefully, like Anne Frank's little square of chocolate. Using it now while we're still in the worst of our energy habits would not, in fact 'Help a little bit' .. We would just burn it off like giving a drunk a couple dollars outside a package store..

The other day, one of the Simmons videos had him referring to a shoreline spill in California that let the 'Greens keep us' from getting that oil. Well no, Matt, it was the spill that did that, wasn't it?


OR we could start adapting to the fact that oil production WILL decline (and soon) - start attempting to mitigate the results of that decline and save some of that (rather pathetically small amounts in the world scheme of things) oil remaining on our turf

I would think having a very small reserve of oil for an uncertain future would be a good thing for the US - Lord knows we've been spending like drunken sailors ashore for far too long - hell, we've been spending the NEXT sail's cash and our kids' while we were at it - what's the hurry? why not use other people's oil now and have some waiting at the end of this binge?

Some very interesting videos. I had never seen the 1979 video.

Yergin and Hubbert on the same side US Govt video 1979

Yergin predicts oil around $50 for 2008, some very interesting Saudi comments:

Daniel Yergin - Oil Feb 2007

Yergin predicts oil around $60 for 2008:

CERA's Yergin Predicts 2008 Oil Prices (August, 2007)

And a link to Daniel Yergin Day article:


In a column in Forbes Magazine, published on 11/1/04, Daniel Yergin, in response to a question about the future direction of oil prices, dismissed concerns about oil supplies and asserted that oil prices on 11/1/05 would at $38 per barrel. Note that oil prices exceeded $60 in the summer of 2005, prior to the hurricanes.

In my opinion, Mr. Yergin serves as an excellent symbol of the major oil company/major oil exporter/energy analyst group. And since oil prices are now trading at close to $76 per barrel--twice Mr. Yergin's prediction--I hereby designate July 13, 2006 as "Daniel Yergin Day," in honor of Mr. Yergin's continued efforts to, in effect, persuade Americans to continue driving large debt financed vehicles, on long commutes to and from large mortgages.

And Dan Yergin late last week, speculating on the outcome of the meeting yesterday, and not committing to any price forecast!


I like that piece about the US Congress passing a bill to sue OPEC. Plain crazy.

Last week there was a brief thread about the costs of oil infrastructure centering on steel and steel pipe. Well, it's now going to be even more expensive and harder to get thanks to "tariffs of up to 700%" on such products. I found this amazing:

"China's steel industry has grown so fast that its total capacity is now more than the entire capacity of the US, Japan and European Union combined."

I guess our "infant industries" need protection once again.

CBS Evening News was fun tonight!

The best I can tell, the whole country is moving back to the city, and America is to be completely restructured because we have to pay half as much for gasoline as the Europeans do. James Howard Kunstler will be so happy!

In the meantime, Congress looked just like TOD today, with multi-colored charts everywhere! Apparently a bunch of Congressional people believe the Saudi's about the speculators, with promises that if we take the speculators out, the price of gasoline will drop by half in the next two weeks! Cool, no need to build refineries, no need to introduce new technology or efficiency! The charts showed the massive flood of money and "speculative" investors that has poured into the energy markets, amazingly starting just after the dot.com crash! Funny coincidence huh?

Of course, this leaves a bit of a conundrum. Will the price really drop when they ban the speculators that we all know cannot possibly exist? And if it does, what happens to everyone's pension fund money, university endowments, city and state retirement money and other "safe" investments that have been poured into the energy markets over the last eight years by hedge fund and mutual fund managers? Can anyone spell "collateralized debt obligation"?

Gee, peak oil is boring compared to this show! :-)


I wonder what the global demand is for $65 oil- 120 million barrels? Maybe they want a global rationing system run through their Wall Street cronies' hands.

'We're toast' without action on warming says NASA scientist


It is the BURNING of hydrocarbons that is causing problems.

Drill all you want just stop burning the fossil fuels ...especially in internal combustion engines which is the most polluting.

just stop burning the fossil fuels ...especially in internal combustion engines which is the most polluting.

Considering that coal is a 'fossil fuel' and introduces heavy metals, radioactive elements and CO2 to the air and can not be used in internal combustion engines, I'd say that your statement is incorrect.


And the methane just keeps comin'....


Update on the Volt.


1. Lutz alluded that there may be photovoltaic roofs on the Volt after all. A very striking new fact as that has been one item people have requested more than anything else since the concept was first unveiled. I guess GM couldn’t resist the public demand.

2. He confirmed 10,000 Volts on calendar year 2011, a few will slowly ramp out in late 2010. 60,000 Volts in 2012, and the sky is the limits after that

3. He said the Volt will be priced at "just under" $40,000

4. He talked about dealers servicing abilities and said people might have to come in every 3 months to clean out the fuel tank.

1. I think the author is confused on point 1, as a solar panel on the roof of the car makes little sense. He must have meant on the roof of your house.

2. Only 10K cars in 2011?

3. Looks like it'll cost $39,999

4. Does gas go bad in 3 months?

Of course this is all dependent on if there still is a GM in 2011.

a solar panel on the roof of the car makes little sense.

Marketing gimmick - an option to let buyers show off their 'greenness' - doesn't have to make sense in any other way.

Solar panels on the roof work fine to run ancillary load, especially air conditioning in hot, sunny climates - SoCal, for instance.

Still makes no sense. If your ancillary loads are so trivial that it can be run by a solar panel the size of your car roof, then the added load to your already humongous batteries will be insignificant.

How much would the roof solar panel generate? 200w? 250w? The volt has a 16kwh battery. What would be the point?

And the car already has a generator on board.

How can you justify the extra cost of the solar panel? Especially when GM is already struggling to keep the car under $40k.

The costings should be done properly, of course, and not implemented if excessive.
It is unclear how much they would be as solar panels have only been used in one-off and prototype builds for this purpose.
In hot climates like Australia though they have proved effective in keeping the car cool - suppose you drive to work, and park up your car for 9 hours.
During that time the solar panel keeps the car cool as the 100-200watts/hour have continued to be available.
Every watt counts for electric cars, so providing it could be engineered at reasonable cost it would contribute.

There is no point in including an expensive solar panel for a tiny ancillary load when you already have enormous batteries and even a generator on board.

And no, not every watt counts since this is a hybrid vehicle not an electric vehicle. That means you can recharge your batteries nearly instantly on demand if somehow your tiny load made any sort of dent in the battery level.

Your solar panel is just pissing in the ocean. There is no way you can justify it.

It would make a lot less sense on a hybrid than on a pure EV.
Since we have no idea of the likely cost or specifications, reaching a definitive judgement seems hard at the moment.
If it is just a case of a relatively inefficient thin-film technology being used, then the cost may not be high.
Perhaps it is a good idea to wait and see what they propose before deciding whether it is any good.

Dave its very easy to see its useless, there is no need to wait and see.

Its an expensive part that has absolutely no value.
It makes no sense on a hybrid (and very little sense on an EV which is irrelevant since the volt is a hybrid).

And if you use "a relatively inefficient thin-film technology" then you are getting even less power from an already tiny solar panel making it even more useless.

Give me a break.

Solar power currently costs around $4/watt, so a 100watt system might cost $400 - you need to install it, or perhaps just print it on the surface, but costs are dropping rapidly - to $1.29/watt in the case of First Solar's audited accounts for the first quarter of 2007.
Lithium batteries currently run at $1000/kwh
So if you run the air con for 10 hours with solar panels the costs should be at minimum comparable, and you would not have to lug around the extra batteries.
It's usually best to try to see if things can be made to work, in the experimental method, rather than making a priori conclusions which are necessarily based on incomplete information.
The engineering department of GM perhaps deserve the benefit of the doubt.

The GM engineering dept already nixed the idea. *BUT* the Volt is being built as a PR exercise (PR guy involved from Day 1 concept) and the public wants it.

Oh well, better than tail fins, and excessive chrome.


One small advantage, it would prevent self discharge when a Volt is left parked for weeks.

With a self discharge rate of 4-5% per 30 days it really wouldn't be much of an issue anyway.

Ahh, but pay the extra $2000 for the combination sunroof/solar panel option, and you can leave the park lights on for weeks, and still not discharge the battery, while impressing your neighbours with your green credentials. Indeed the alarm system can operate for a full year if required* [*providing vehicle not parked in shade]

People forget that a very large chunk of the cost of a SUV is basically for stuff that adds no value in any way other than the drivers perception of how others perceive them. It just makes sense to me that if you were selling an all electric vehicle, offering a 'solar' model would likely increase sales and profitability.

What good is a 100watt solar panel?!? What difference could it possible make?

You already have 16kwh of batteries and a generator. Your solar panel is just a rounding error.

A 100 watt solar panel is completely useless. I don't care how much its costs. It could be free and it still wouldn't be worth putting on the car!

Good grief you're dense.

And as usual you refuse to refrain from personalities.
Why are you so special that you are privileged to be rude?
Since you obviously know more than the engineers at GM, and your company is not pleasant, I will leave you to your prejudices.

If GM engineer the car well (it doesn't have to be brilliant), then it'll use something like 200wH/Mile. A 100W 'sunroof' parked in the sun at your workplace will give you an extra two and a half Miles of travel (assuming five hours of effective 'full' sunlight in a day). That's about 6% of the average US Commute, so not huge, but nothing to sneeze at, given that it's basically free. Or as mentioned upthread, you could use it to keep the car cool/warm.
If you're stuck in a traffic jam every day to and from work and do 10mph, it might just power the car by itself. :D

Fine, so if you park in the Mohave desert the generator would kick in at 42 miles instead of 40. That hardly seems significant. Since the average commute is less than 40 miles having an extra 2 miles of range via a solar panel is pointless.

And the only way it would power your car by itself is if you drove at 0.5mph since it takes 2 hours at full sunlight to generate 200wh. If you drove at 10mph as you said, you would need a 2kw solar panel. Or about 20 times the size we've been talking about.

Almost pointless, but not actually so.
You also don't need to park in the Mohave Desert either. Anywhere within about 30 degrees of the equator gets a few solid hours of sunlight a day.
And besides, as others have said, you could use the panels to maintain a trickel charge, keep the car cool/warm, etc.
For driving, it'd probably be better to just buy some more Cells, but a 'solar roof' does have its own advantages. Personally, I wouldn't bother, but some might.

In '56 or '57, which was over 50 years ago for the math impaired, GM and Jr Scholastic Mag put on a school assembly behind JS's car designing contest.
The guy from GM puts a model car on the table. Sez "This is the way cars will run in the future". Flips on a sun lamp and the solar powered car runs across the table.

Isn't 50 years "in the future"? Where is that car? Somewhere in the bowels of GM, locked up in a safe, is a model car...

Of course this is all dependent on if there still is a GM in 2011.

Yes, I noticed this on Mish's blog:
GM Deathwatch

Of course, whether or not GM makes it, the cat is out of the bag. Pretty soon, folks will be driving their own "hacked" Prius',
and Toyota has committed to the factory plug hybrid Prius by 2010. Daimler Benz has already tested a pilot version of a plug hybrid C class Mercedes.

What I am waiting for is for A123 to start selling the battery pack to hobbyists for full electric conversions, much the way the Altair and original Apple were sold as kits to home computer geeks.

A123 has never gone public and probably never will. The insider venture capitalists, hedge funds and big banks will never let this one into the hands of the public, and the equal of Vanderbilts and Carnagies and Mellons will be born out of what will be the greatest revolution in energy and transport the world has ever known.

Sorry for GM if they can't stay up, but we have to give them credit, they are running at nearly wartime pace in the implementation of the Volt. They know how dire their situation is. But, the revoulution has started, and whether GM gets to the starting gate in time is of interest only to GM shareholders and employees. It has no effect on the revolution, which is now past the point of being stopped.

Brief aside, if KSA actually has the oil they say they do and can produce it, they have made a horrific error. They waited too long. We have probably already seen the peak in crude oil and gasoline demand in the United States, Japan, and Western Europe. China and India will have to rise some, but the curve will begin to flatten very rapidly. Peak demand has always been a fear of the Saudi's. In the developed Western nations, it is here. French Total Chief
Christophe De Marjorie famously said a year or so ago, "100 million barrels a day...never." He was more right than even he probably knew.
The oil and gas industry has been running a TV ad in which they claim the world will need twice as much oil and gas in 2030 as now. To which I say..."never".

What I am waiting for is for A123 to start selling the battery pack to hobbyists for full electric conversions, much the way the Altair and original Apple were sold as kits to home computer geeks.

You don't need to wait for A123, there's plenty of other LiFePO4 battery manufacturers who are willing to sell to the individual. Some are even quoting as little as 60c/wH (plus delivery), for batteries the equal of A123's.
Of course, they're all manufactured in China, but what do you expect (Valance I'm not sure about).

Yes, Valance manufactures it's batteries in China. I don't care about that, most computer components are made in Asia and I use them everyday.

If you happen to read this reply, Bellistner, do you have a good list of the LiFePO4 and L-ion manufacturers selling to the individual?

I have been trying to build just such a list, but you may be far ahead of where I am on this, any assistance would be greatly appreciated. You can also reply to my e-mail at admin@irvingtondesign.com

Thanks, RC

Ian Hooper here in Oz has been testing some LiFePO4 batteries on his website: http://zeva.com.au/tech/LiFePO4.php

I don't have a list of manufactueres (the names come and go), but there's fairly constant discussion of battery technology if you follow the Electric Vehicle Discussion List (EVDL). I need to start reading it again (I'm about two and ahalf months behind. :) ).

From the link up top:

World has enough oil supplies for 'many decades': Nuaimi
"The world has enough petroleum reserves, both conventional and non-conventional, to meet oil demand for many, many decades to come," Nuaimi told a summit in Jeddah of top consumers and producers.

I notice that he didn't say current demand. ;)