 | Performance Governing: Getting Lucky and Staying Lucky | The Oil Drum | Abundant Skies: 8 Principles for Successful Rainwater Harvesting |  |
DrumBeat: July 5, 2008
Posted by Leanan on July 5, 2008 - 9:04am
American Energy Policy, Asleep at the Spigot
|
|
Over the last 25 years, opportunities to head off the current crisis were ignored, missed or deliberately blocked, according to analysts, politicians and veterans of the oil and automobile industries. What’s more, for all the surprise at just how high oil prices have climbed, and fears for the future, this is one crisis we were warned about. Ever since the oil shortages of the 1970s, one report after another has cautioned against America’s oil addiction. |
Oh, no, they told us, Iraq isn't a war about oil. That's cynical and simplistic, they said. It's about terror and al-Qaeda and toppling a dictator and spreading democracy and protecting ourselves from weapons of mass destruction. But one by one, these concocted rationales went up in smoke, fire and ashes. And now the bottom line turns out to be ... the bottom line. It is about oil.
UK: Beleaguered Brown may scrap fuel duty increase
In the week that a barrel of Brent crude oil climbed by nearly US$4 to a record high of over US$146, British prime minister Gordon Brown hinted that the 2p a litre increase in fuel duty due on October 1 would be scrapped.‘‘You’ll find that in most years since 2000 the duty has actually been frozen,” Brown told the Commons liaison committee. ‘‘It is clearly a matter that will be looked at very, very carefully over the next few weeks.”
Nigeria's first oil well is still a source of woe
OIL WELL NO. 1, NIGERIA -- Three decades after pumping its last drop, the first oil well in Nigeria is marked by a decrepit signboard bearing what would seem an uncontroversial statement:Oloibiri Well No. 1, drilled June 1956, 12,008 feet.
But this well, its wellhead furred with rust, is at the center of an increasingly vitriolic feud between two villages over who owns the land it's on. The conflict is fed by hope that soaring prices will tempt big business to squeeze more oil from the well and give a pittance to the village that owns the land.
How China’s thirst for oil can save the planet
The pioneers of green energy report a ‘gold rush’ mentality as soaring oil prices speed up the search for alternatives.
As Gas Prices Soar, Elderly Face Cuts in Aid
Faced with soaring gasoline prices, agencies around the country that provide services to the elderly say they are having to cut back on programs like Meals on Wheels, transportation assistance and home care, especially in rural areas that depend on volunteers who provide their own gas. In a recent survey by the National Association of Area Agencies on Aging, more than half said they had already cut back on programs because of gas costs, and 90 percent said they expected to make cuts in the 2009 fiscal year.“I’ve never seen the increase in need at this level,” said Robert McFalls, chief executive of the Area Agency on Aging in Palm Beach, Fla., whose office has a waiting list of 1,500 people. Volunteers who deliver meals or drive the elderly to medical appointments have cut back their miles, Mr. McFalls said.
As oil prices soar to new heights and nationalist feelings start to emerge about "national assets", many companies across the globe are starting to feel the pinch and are looking to brace for a possible backlash, a move that could cause headache to Thai companies expanding outside the safe borders of Thailand.The latest to join the bandwagon is Vietnam, which is facing an economic meltdown after having witnessed robust growth over the past few years. Activity in Vietnam comes after Mongolia undertook its move and talk started to appear in Indonesia of ways to control exploitation of "national assets".
Spying claim may be new snag for Mexico oil debate
MEXICO CITY (Reuters) - Mexican President Felipe Calderon's efforts to get a divided Congress to back an oil reform proposal are facing a new snag as a key opposition lawmaker accuses the government of spying on him.
Pakistan: Landikotal students damage WAPDA office
LANDIKOTAL: The students of Landikotal Degree College on Friday stormed the Water And Power Development Authority’s (WAPDA) grid station and damaged its administrative block during a protest rally staged against continued power outages in the area.“Our annual BA/BSc examinations have been started and we are suffering due to unscheduled load shedding,” the students said.
Is Chennai fuel crunch harbinger of pan-India crisis?
But the reality goes beyond Chennai. Oil companies say it will be difficult to sustain supplies if demand continues to grow at the current levels.
Talking Points For An Energy Crisis
Airlines are cutting back on water for plane toilets to save weight and fuel. They had better come up with a better business plan than that. And in the face of the burgeoning oil-price crisis, America had better come up with a plan as well.Single-issue fixes -- like John McCain's plan to grant consumers a summertime gas-tax holiday, or Barack Obama's proposal for a windfall profits tax on oil companies -- just won't do it. America needs a comprehensive plan to deal with post-peak oil -- and that is going to involve some serious long-term thinking. To get the thought process going, here's a list of ideas -- some good, some not so good -- about how to address political, technological and social dimensions of the planet's most pressing issue.
Obama will have to avoid Carter trap
So is Obama the new Jimmy Carter? One has to hope not. For all President Carter's integrity and intelligence, he has gone down in history as a weak president. His period in office was marked by foreign policy disasters in Iran and Afghanistan. If Obama is elected president next November, there will be ample opportunity for fresh disasters in both places. There are three Carterite failings that Obama will have to watch out for: panic, pessimism and naivety.There is no doubt that America faced an energy crisis in the 1970s. But Carter embraced an almost apocalyptic vision of the problem that now looks ridiculous. In 1977 he solemnly informed a national television audience that: "We could use up all the proven reserves of oil in the entire world by the end of the next decade."
It was a July Fourth like many others. There was nothing overt to signal anything was wrong. The Red Sox had traveled from Boston to play a weekend series against the Yankees in the Bronx. In Washington, the National Independence Day Parade made its way along Constitution Avenue.And yet, there was an undercurrent of anxiety in the land. Vacations have been curtailed because of the price of fuel. Since the holiday fell on a Friday, the monthly unemployment numbers from the Bureau of Labor Statistics were released a day early, on Thursday. They weren’t good.
The King of Saudi Arabia talks about oil; we should listen.
One astonishing aspect of the energy crisis is the western media’s preferences when it comes to sources of information. They love western speculators, economists, oil company executives, and politicos. Others go to small articles in the back pages, including statements by leaders of oil producing nations - even the King of Saudi Arabia, home to the world’s largest reserves. No wonder the American public gets surprised by every new development.
The myth of energy independence (audio)
Ridding ourselves of foreign energy sources is nothing but a myth according to "Gusher of Lies" author Robert Bryce. Host Bob Moon talks with Bryce about setting realistic energy goals for the U.S.
Israel: Do the Arabs gain from the energy crisis?
An energy crisis is upon us again.As Israeli gasoline prices this week broke the psychological barrier of NIS 7 a liter, while the truckers threatened to paralyze traffic across the country in protest against gas taxes, it became clear even in this prospering economy that there can be no escaping the tumult that has already made Egyptian, Haitian and Yemeni mobs storm stores, while India and China slashed oil subsidies and Pakistan said it will not be able to pay for its signed oil contracts.The crisis is simple: There is too little crude around and too many people on queue to buy it. Understandably, then, many suspect that this crisis, like the oil embargo of the '70s, is good news for the Arabs.
It isn't.
These are booming times for the oil industry and the sector's workers are reaping the benefits as a lack of qualified labour has led to soaring wages, experts say. At this week's World Petroleum Congress in Madrid, recruiting and retaining personnel emerged as a leading concern for oil company chiefs as they search for geologists, engineers and project managers in a limited pool of talent.
UK new car sales down, fuel a factor
Sales of new cars fell 6.1 per cent in Britain in June compared with a year ago, an industry group says...."We are now seeing concerns about rising fuel bills and household costs dampening consumer confidence, leading to slower demand for new cars," said Paul Everitt, the society's chief executive.
The energy crisis and its effects on the airline industry are putting a damper on fun in the sun, and the Caribbean is being particularly affected. The high cost of fuel is leading the airlines to increase their prices, cut back on expenses and even cancel flights. The result is that fewer people are traveling, as they are unable or unwilling to pay the increased fares, and the ones who do fly are suffering the consequences, as are small Caribbean nations.Tourism is vital to the economy of this region. Many of the islands rely on tourism to keep their economies afloat.
A new corporation looms on the smoggy horizon: The Air We Breathe Inc
THE greens might not like to think of it this way, but the carbon emissions reduction regime that Ross Garnaut recommends and the Rudd Government will adopt amounts to the corporatisation of clean air.
I'm going to go out on a limb here with a couple of bold predictions. I think we are at a pivotal point in history; that we are witnessing the early stages of a massive shift in the global economy, in the balance of power and in the way we live.Australia has become a barometer for these far-reaching changes. We are being pulled in opposite directions as we send vast quantities of resources off to China while a virus that started on Wall Street and spread across the US and Europe has infected our financial system.
In years to come, it's quite probable we will look back at 2008 as the year in which everything changed. And most of the changes being wrought upon us relate to energy, our use of it and its cost.
World must brace for oil beyond $150
LONDON (Reuters) - Oil's meteoric rise since the start of the year to nearly $150 has distressed consumers and policy makers the world over, but the stark reality is prices are likely to rise higher still.For two decades, prices were relatively stable, but then they rose seven-fold from a trough below $20 in 2001. Since breaching the $100 mark on the first trading day of this year they have risen around 45 percent.
Given such momentum, politicians' efforts to bring the price down could well be a waste of energy.
"It rose so fast it's got a bubble feel, but bubbles can go on for very sustained periods, and underlying that is an extremely tight fundamental position," said Stephen Thornber, head of global energy research at Threadneedle Asset Management.
Oil minister: No country dares to attack Iran
TEHRAN, July 5 (Xinhua) -- Iranian Oil Minister Gholam-Hossein Nozari said Saturday that no country will ever dare to carry out an act of aggression against the Islamic Republic, Iran's satellite Press TV reported."Iran's capabilities are such that no country can conceive of attacking it," Nozari said.
"If Israel dares to engage in a military conflict with Iran, it is not clear what would happen to oil prices," Nozari warned, adding that even empty anti-Iran rhetoric "pushes oil prices up by10 to 15 dollars."
U.S. investor: Oil reserve decline is major reason behind oil price hike
U.S. investor Jim Rogers has said that the decline in known oil reserves across the world is the main reason behind the skyrocketing oil prices that have already topped 145 U.S. dollars a barrel.While admitting that factors driving up oil prices are various, Rogers insisted that short of oil supply was the fundamental factor pushing oil prices up all the way.
Companies begin quest for oil, gas off Florida
PENSACOLA, Fla. - Oil companies once viewed drilling in the deep waters off Florida as cost prohibitive. Politicians feared even the slightest sign of support would be career suicide.No more. Record crude oil prices are fueling support for oil and natural gas exploration off the nation's shores. In Florida, movement was underway even before President Bush called on Congress last month to lift a federal moratorium that's barred new offshore drilling since 1981.
Iran and Brazil Can Do It. So Can We.
Is energy independence a pipe dream? Hardly. In the electricity sector, the mission has already been accomplished. Remember President Jimmy Carter in his cardigan during the oil crises of the 1970s, urging Americans to save electricity? It took us just one decade to wean the electricity sector from oil. Today, only 2 percent of U.S. electricity comes from oil, according to the Energy Department. Could we do something similar with transportation, where American cars and trucks still gulp oil-based fuel greedily? At least four very different countries -- dictatorships and democracies alike -- are already making serious headway toward that goal. It's past time to pay attention to their example.
Big Oil poised to make triumphant return to Iraq
When Big Oil excutives and U.S. Vice-President Dick Cheney met for secret energy talks in the spring of 2001, one subject that weighed on all their minds was the potential loss of Iraq's bountiful oil reserves.After more than a decade of hostile U.S.-Iraqi relations, Iraqi dictator Saddam Hussein had negotiated deals with oil companies from a range of countries, including Russia, China and India, to develop Iraq's largely undeveloped reserves.
That meant U.S. oil companies were to be denied a stake in developing one of the last oil bonanzas left on Earth. It also meant that the U.S. risked being denied access to this vast new source of petroleum – the commodity it considers essential to its continued status as an economic and military superpower.
Pemex seeks site for new refinery to cut gasoline imports
Petroleos Mexicanos, the state-owned Mexican oil company, may begin construction of a $7-billion refinery by the end of 2010 to reduce imports of gasoline and diesel fuel.A study has been commissioned to determine the site of the new plant, according to a filing with the U.S. Securities and Exchange Commission.
If we are truly reaching the end of petroleum production -- a scenario known as "peak oil" -- there are all kinds of gloomy predictions one could make. Facing the future of $200-a-barrel oil, analysts are already using terms like "financial tsunami." They predict that inflation will skyrocket with the price of gas, creating a flashback of mid-70s stagflation. Commuters will become energy refugees, abandoning their homes and their SUVs and invading the cities. In the meantime, production costs will cripple manufacturers, a scenario that would turn Central Canada's factories into a scrap heap of rust. "I can't think of any upside to $200[-a-barrel] oil," former EnCana chief executive Gwyn Morgan told the National Post.Yet if history is any example, ingenuity can trump disaster. After all, we live in a market economy that can adjust, innovate and progress. After Malthus's famous end-of-days scenario, necessity mothered invention: diversified agricultural techniques appeared, legislation led to cheaper food imports and the Industrial Revolution made for greater efficiencies. Almost two hundred years later, the same thing happened. Paul Ehrlich predicted in his 1968 bestseller The Population Bomb that exploding demographics and an imploding food supply would literally decimate the United States, leaving only 22 million survivors. But the so-called "Green Revolution" stepped in. Pesticides, irrigation projects and synthetic nitrogen fertilizer contributed to a massive agricultural advance. And population-wise, there was another significant development: The Pill.
Out for a bike ride in Northern California, whipping down some rural road where the cows far outnumber the cars and the only energy actively being consumed is generated by the home fries you had for breakfast, it's easy to feel, however fleetingly, that you've escaped from the gas-price peak-oil climate-change rat race. The world simplifies. Head winds and hills are straightforward challenges, easy to parse, in contrast to such mysteries as to how much speculation contributes to the cost of oil, or how to calculate the net energy-efficiency of biofuels.But then I read, in this morning's edition of the Road Bike Rider newsletter, that WTB, a high-end bike component manufacturer, raised prices on its tires and tubes 20 percent as of Monday. Michelin is following suit, instituting its own 15 percent price hike on Sept. 1.
There is no escape.
Venezuela calls on OPEC to subsidize oil for poor countries
CARACAS -- Venezuelan President Hugo Chavez Thursday called on the OPEC cartel to absorb the costs of the oil import bills of the world's 50 poorest countries, predicting that the price of crude is "going to continue rising.""OPEC, or some of its members, should take the responsibility to supply these countries through special mechanisms, subsidies, donations, agreements. It is not going to make us any richer or poorer," he said at a meeting of the non-aligned movement at Isla Margarita on Venezuela's northern coast.
Backing off on the gas : Teens alter summer plans amid soaring prices
Squires, 18, attends San Diego City College. He wants to transfer to the University of San Diego. He wants to study medicine. More immediately, though, he wants to volunteer at a hospital so he can start preparing for a future in medicine.But he can't do that.
Squires' summer plans have changed due to the rapidly-rising cost of gasoline. He can't afford to make the trek to volunteer at the hospital. Instead, he stays close to home, working a part-time job because it's what he has to do now.
Traditional fishing lifestyle in south Thailand under threat
PATTANI, Thailand (AFP) — Idling on the muddy sands of Thailand's coastal deep south, fishing boats hand-painted in lurid primary colours languish while their owners look on helplessly.Traditional fishing, once a thriving industry in southern Pattani and Yala provinces, has been reduced to a dwindling niche activity as fishermen lose out to large commercial firms and soaring fuel prices.
European utilities building up uranium inventories
Utilities in the 27 European Union states have started to rebuild their inventories of uranium, according to the Euratom Supply Agency. Plutonium recycled in European reactors saved the equivalent of over 1000 tonnes of natural uranium.
Changing Environment - Dealing With Disaster: 'Climate refugees' on the increase
The number of migrants is rising so quickly that it might destabilize the world.
Only seven years left for global warming target: UN panel chief
PARIS (AFP) - The head of the UN's Nobel-winning panel of climate scientists on Friday said only seven years remained for stabilising emissions of global-warming gases at a level widely considered safe.
There's another carbon problem, which will profoundly affect our oceans, that has received scant attention beyond a small band of marine scientists and is largely independent of global warming.
UN chief to G8: climate change, food crisis linked
AMSTERDAM, Netherlands - The global food crisis will only worsen because of climate change, the U.N. climate chief said Friday, urging leaders of the world's richest countries meeting in Japan next week to set goals to reduce carbon emissions within the next dozen years.Food security and soaring oil prices are likely to overtake climate change in the priorities of the G-8 meeting starting Monday, though global warming was the theme set by the host, Japanese Prime Minister Yasuo Fukuda.
Contact
- Content: editors at theoildrum dot com
- Tech support: support at theoildrum dot com
License
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.
Fuel Prices give pause to Anti-Rickshaw Restrictions
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/27/AR200806...
In the Amsterdam photo essay yesterday, I saw a couple of "bicycle taxis". Western versions of rickshaws.
Best Hopes for Non-Oil Taxis,
Alan
http://www.citizen-times.com/apps/pbcs.dll/article?AID=200880516153
Pedicabs bring leg-powered locomotion to downtown
Nanci Bompey • • published May 17, 2008 12:15 am
I live in Asheville and have seen them downtown. Also I have been a competitive cyclist all my life, am in fantastic shape, and have 20 years of serious cycling behind me. Still I cannot imagine riding a 200lb thing + passengers up these hills.
Many a time I have seen pudgy tourists having to take a break just walking up some of our streets.
Commuting to work 5 miles to by bike is not bad except bringing a complete change of clothes for 'professional office attire'.
I'm a veteran Hike-Biker. Asthma nails me sometimes and there's no benefit on staying on the wheels for some of the steeper hills. I used to do it A LOT while mountain biking when all I had was a Huffy 12 speed that was geared well - if you lived in a world that was perpetually downhill in all directions. That was back in the day when suspension systems only came on the front of the bike, were a total novelty, and had all of about 1" of travel - 18 speeds were common enough, 21 speeds were like some holy grail, and if the bike was under 30 pounds you were doing well. I used to pass people by walking the bike up steep grades...moseying by people pedal standing and spinning their tires. As far as the pedicabs I've yet to see one and I walk around downtown quite a bit. I imagine if it's geared well enough the weight isn't going to matter so much, no minimum speed is required to keep them upright, but you'd better be ready to accept SLOW. 100watts can only move a heavy object up a hill so fast.
Bicycle taxis are relatively common in places like Cambridge (UK) with young people looking for part time extra income (ie, students) but the current economics mean that they're more a novelty for tourists rather than a day-to-day transport system. (The other problem is that the width of the carriage means they've got much more width than a bicycle so they get stuck in traffic but don't have the speed and "endurance" of a fossil fuel vehicle.)
Somewhat retated...gas guzzling taxis cutting into the owners profits. Duh.
Rising gas prices hit taxi drivers
http://www.contracostatimes.com/ci_9788772?nclick_check=1
Seems like everyday my local newspaper is getting more like reading TOD. There are at least a half dozen energy fueled articles (pun intended).
http://www.contracostatimes.com/business/ci_9789078
this is why I also think that oil is a mini-bubble. every day high gas prices are on the tv. every day there is a story in the paper about high gas prices or about local pizza joints beings squeezed by high prices. kunstler's article was even in the newspaper's sunday section.
O John, we know you're weakening. Come over to the Dark Side (dark crude, that is!)
Hate to burst your bubble. We've got you hooked. That's why you read TOD everyday. Bit like a narcotic - you can't do without your daily fix.
Cheers!
Mmmm Sprinkles..
*drools*
Hmm, in my case I stayed away for about four months and came back and not much really had changed, although admittedly john15 was new.
I go in phases of my own version of denial. Or rather trying to grasp onto life outside of an addictive blog setting :) . But for now, my computer way of life is still totally unnegotiable! (though something I consider eventually doing intellectually... somehow I lived a nice chunk of my life without instant access to information).
They exist but it's still a crazy expensive novelty at this point - you can get a ride around Central Park in NYC for $60 ... they're not competitive with the ICE cabs ... yet.
I saw one in Boston yesterday ... a single, lonely tourist attraction on a pier where lots of tourist cruises and one MBTA ferry dock.
http://www.ft.com/cms/s/0/7a16ab6a-49f9-11dd-891a-000077b07658.html
Interesting. I hope it get picked up by a site without a paywall.
Hmmm ... I don't pay to access the site! I can copy more if you can't access it ... it is an interesting article.
FT.com has really funky rules. Someone said you're allowed to view 5 articles a month, and if you go over that, you're blocked. You can get around it by deleting your FT cookie.
And like the WSJ, you can see the article if you go in through Google News. So I can read it. I just wish it were at another site, because it's a lot easier to share the story if you don't have to jump through so many hoops.
Yahoo and MSNBC sometimes pick up FT articles, so there's hope.
There's an option to register with FT free of charge which allows viewing of 30 articles per month. Above 30 per month and it's necessary to subscribe.
I just copied the article off the FT web site, but am hesitant to send it to you as a post. Or, I can send it in as a post, and you can take it off before it goes up live...
I can copy it myself. I just want a free link I can post elsewhere, without telling people to clear their cookies or go in through Google News.
Here's a link:
http://siliconinvestor.advfn.com/readmsg.aspx?msgid=24731662
I'm stunned.
Thank you.
"And like the WSJ, you can see the article if you go in through Google News."
I usually copy a sentence from the article and paste it into a yahoo news or a yahoo web search and that often works.
I just google the headline, which is most often just carried over from the original article. Works 90% of the time...
I also can see it. I am logged into Financial Times with my free login though.
That article is a funny-sad story ... :-)
from the article
flashback regarding Kashagan (discovered in 2000)
Kashagan is the giant oil field in the Caspian Sea that was supposed to start producing oil in 2005
Kashagan- first oil- is now postponed to 2013.
Is there a virus ?
But this one was worrysome -
How much corrosion has the platform itself suffered due to this ?
My own favorite quote from the arrticle (last paragraph):
"While commissioning some of the wells, we encountered problems with some industry-standard equipment that we will repair," the company said. "We have time in the schedule to resolve these issues and the project remains on schedule."
They must have something which enables time travel back to 2005, at least, if the remain "on schedule."
With great hopes for Jack # 2, someday. Or Son of Jack # 2?
The thing shows Gigantism meeting reality.
BP has thrown multi billions at this thing and will not quit.
It's cursed. You can see it. Nothing has worked right from Day 1.
And I'm still waiting for pics from August 05 to Mar 06.
I expect nothing.
Pix like this ? Google Thunder Horse
almost. Right after Katrina. Like this:
http://mceer.buffalo.edu/research/Reconnaissance/Katrina8-28-05/01concra...
An offshore oil platform dislodged by Katrina’s high winds slammed into the Cochrane Bridge over Mobile Bay, damaging its cable system and concrete structure. The federal funds will reimburse the state for repairing the Bridge and for new ramps connecting U.S. 90 and Interstate 10, replacing or repairing damaged traffic signals and highway message signs, and the cost of clearing downed trees, sand and other debris from roads immediately after the storm.
The pics you show are all from Dennis damage.
problems with 3 wells ? what sort of problems? the article doesn't say.
problems with wells are the norm.
and finally from the ft article:
"We have time in the schedule to resolve these issues and the project remains on schedule."
well, in reality the "scedule" has already been pushed back at least 3 yrs.
give them a break, this project is on the leading edge of technology.
"...give them a break, this project is on the leading edge of technology."
Excuse me?
Well why doesn't BP give us a break.
You need details on Prudhoe Bay leaks, Texas Refinery killings (court docs on request), cornering the US propane market, and fuzzy math on reserves.
I can tell you there is severe dissent going on right now in BP over this.
TH project will have to downsized. And this is the point.
huge doesn't work any more, if it ever did. De centralization is the MEME
now. Multiple doable projects scattered, hitting critical mass.
Like the planet works, eh?
"You need details on Prudhoe Bay leaks, Texas Refinery killings (court docs on request), cornering the US propane market, and fuzzy math on reserves."
maybe bp SHOULD provide that information.
that has nothing to do with inventing technology that hasent been used. do you lack an understanding of the difficulty and complexity of bringing an oil or gas field large or small into production?
as long as motorists demand gas for their gas guzzling suv pleasure barges bp will try their best to provide it, $hit will happen.
would capt hazelwood have been drunk at the helm of the valdez if there wasnt demand for gasoline ?
"that has nothing to do with inventing technology that hasent been used."
I respectfully disagree.
If BP could, it would. Because it's having to turn to gangster type
activities to cover the fact that it's cutting edge activites
are turning into bleeding edge.
Technology is only a manifestation of the type of energy in use.
No more increasing of that energy, then no more increasing of that
technology.
"...would capt hazelwood have been drunk at the helm of the valdez if there wasnt demand for gasoline ?
Strange way to put it but I'll go along.
This is exactly why us Dirty Phuckin' Hippies scream to stop.
We know that a "Hazelwood" will happen. And betting the farm on a tech
like nuclear or shipping toxic waste (to an otter and it's food chain), which has a necessity of near perfect tolerance levels
spells Cascading Systems Failure.
Sobering implications for Petrobras, I would think.
Better spread that risk around.
I'm skeptical US refineries ever see one drop from Tupi.
sldulin : "I'm skeptical US refineries ever see one drop from Tupi", they will at $ 500-1000 /barrel in the holy year of 2030.
But then again I may be wrong b/c according to the BERR report discussed the other day , oil will only cost some $ 105 in 2030... 22 years from now.
More BERR : 22 years from now COAL will stay flat costing just the same .... and NAT.GAS will double its cost during these same 22 years. We have a NAT.GAS problem in other words, but if I'm not wrong there are forces in action dealing with this right now ..... the FORCE will bring the price down (again) to align with reality , forgodssake
I recall comments or a link on the Drumbeat when Tupi was announced, and haven't seen any updates, that the discovery well was gassy and fairly heavy oil - like 26 gravity - but no verification. If that is what they have found, 150 miles offshore, it is not necessarily something which they can produce, so don't look for the 2030 timeframe either. The cold ocean depths and increasingly acidic oceans are going to make producing some of these deep wells and getting that production to shore dicey. It is hard enough to maintain the integrity of production facilities on dry land.
Will the EPA try to enforce Spill Prevention Control and Countermeasure (SPCC) regulations in the deep GOM? If you don't know about SPCC plans, they are strictly formatted written documents which every producer has to maintain for every production facility, or will have to pretty soon. They used to apply only to tank battery type facilities, but the law has been expanded to cover the production facilities, flow lines and all other well or lease facilities as well. Heavy fines ARE levied if they are not developed and maintained current. They do not strictly prevent leaks, but do provide guidance in the case of problems, often to the lowest guys on the totem pole.
Thought I would post this, nicest story I've heard in awhile.
http://www.worldnetdaily.com/index.php?pageId=68065
The Swiss are mean fighters.
And Germany needed a place to store wealth internationally.
Kinda like getting past a bouncer. A fist in one hand, $500
in the other. Which do you want?
To move funds in and out, say from Brown, Harriman, into German Divisions
of Ford, IBM.
As Prescott Bush used to say, "If you can't beat 'em, buy 'em."
Bush Tours America To Survey Damage Caused By His Disastrous Presidency
http://www.theonion.com/content/video/bush_tours_america_to_survey?utm_s...
LOL! Check out the Miley Cyrus/peak oil video there.
I missed the China Air Pollution one last April, too:
http://www.theonion.com/content/video/china_celebrates_its_status_as
"Switzerland doesn't HAVE and army, Switzerland IS an army." - John McPhee
As I recall the Swiss had half a million men trained and armed. Some German official asked "What would happen if we invaded tomorrow with a million men?" The Swiss official deadpanned "Some of them would have to shoot twice." The point was taken and the invasion never happened.
The Swiss aren't neutral 'cause they're sissies, they're neutral because the rest of Europe got tired of facing Swiss mercenaries.
How high will gas prices go? Looks like at least $6.15 a gallon, based on peak percentage of expenditures in the 80s:
from today's New York Times.
If we're currently at 4% of expenditures on energy with gas prices of $4.10 a gallon, 6% would be around $6.15 a gallon. And that contributed to two of the worst recessions since the Great Depression.
Gas prices are going down around here. I made a point to check when I went grocery shopping this morning. It was 12 cents a gallon cheaper than last week.
Interesting that there are declines in prices at the pumps while the US is exporting finished product, crude prices continue to rise, tankers loaded with heavy/sour crude sit idle offshore Iran and now SA, and the consensus cry from OPEC is 'the market is well supplied with crude'. Add odor of dead fish.
Of course all the above and more beg the question: What is really behind the current run-up in crude prices?...Which itself leads to another question: Is the current run-up in crude prices, for whatever reason, a good thing for the world in the long run?
I believe that the answer to the second question is a tentative 'yes'... But, it is going to be very painfull for world economies, and people, in the short run.
The world will emerge from the current slow motion economic train wreck a very different place. Oil prices will adjust to the new economic realities.
To shed some perspective on the current situation we can take a look at what is happening, and has happened, to some countries that have faced oil price shock and adjusted. Notice that in these countries the populace did not riot and begin living in caves in the hills. The populations did adjust to the new prices and are continuing to adjust. Of course when 'the real' peak oil comes countries that have adapted gradually will be better prepared to face it. That is why I said the answer to question two was a 'tentative yes.'
To view the charts, EIA Country Profiles, click on the link below...
1) Japan oil consumption declining since 1996.
2) Israel oil consumption decling since 2001.
3) Germany oil consumption declining since 1998.
4) Italy peaked in 1995 and is now down 14%.
5) Sweden hit peak in 1996.
'Savinar says a 10-15% drop will put your economy in the hospital -- shatter the economy and reduce the population to poverty. Apparently Italy didn't get the memo.'
'It's such a shame because these graphs hold the important clues about peak oil. Yet they get almost none of the airplay. The fact that oil production will peak is just a truism -- a statement of basic logic. The fact that a country can reduce it's oil consumption without duress is like a miracle...'
http://peakoildebunked.blogspot.com/
Thursday, June 26,2008... Scroll down to number 364...
The key is debt creation.
you cannot create debt w/o the promise of future energy growth.
And that is the reason for the Financial Crisis and why TPTB are lying
up to today.
I've started noting "Counterparty Risk Increasing", tied to monolines.
These transactions were shams designed to offload liabilities to increase
"credit", to allow more leverage(32-1!).
Now well over $692 Trillion.
The Central Banks are terrified that this derivative monster will
come out(reason the Fed went illegal with JPM) with unwinding due to
bankruptcy.
All we're doing now is finding where the Feds TBTF line is.
At 11,200 hedge funds(offshore tax havens), are getting imploded
like subs diving into a Pacific Trench.
The PPT is doing everything to hold the status quo. They will fail.
Mac, there are several ways that this financial train wreck can end and many possible black swans that none of us can see. I suspect a blow up in the bond markets will do it. Prior to what happened with Bear Stearns I would have guessed a blow up in investment banking. It is now obvious that the Fed will not allow a blow up in the banking sector but the Fed cannot stop a blow up in the bond markets.
Central Bankers of the world are becoming very anxious about the rapidly falling dollar and what that is doing to their dollar reserves and SWFs. The Fed has shown that they don't have the moxy to raise rates with the US Economy on the ropes. Why some people are continuing to buy Treasury Issues is beyond belief when rates of return are well below rates of inflation. How much longer will the $2 billion per day of foreign money continue to flow into the US to float the current account deficit? Already there are articles in the WSJ stating that foreign central bankers and SWFs are starting to invest heavily in SE Asia because the US does not want their money flowing into 'sensitive areas of the economy'...Meaning, foreign money is to flow into the already defunct banking sector or nowhere.
2008 will definitely be the year that 'Everything Changed', and some of the change will be for reasons that we do not now see.
"Why some people are continuing to buy Treasury Issues is beyond belief when rates of return are well below rates of inflation."
I can tell you exactly why because that's all I own.
And I've made more in the last year than 95%+ of traders.
People want the promise of return of principle over return on principle.
With debt destruction trillions are being vaporized now.
Deflation masked by inflation of food/fuel.
Americans at $167 crude will be divorced from both. And farmers are getting squeezed now, believe it or not.
Imagine having to put out an insecticide/fertilizer app that you weren't counting on. On 2500 acres you'll need a loan from the bank.
Mac, if you decide that treasuries are the best thing for you, fine. I own physical gold and have since the late 60s, along with some S&P stocks that I trade when necessary. I am now out of all stock. I sold quite a bit of gold at $1,000 a while back. Bought some back in the low $800 range and will hold for the next big run up which will happen as the collapse of the dollar occurs. I do not make money on gold...all I attempt to do is preserve what I have.
I don't know who said it first, but whoever said 'Get a bag of popcorn and whatch the show in the second half of 2008' was right on. This show is going to be spectacular.
I think you are right about the debt monetization. It is true that we are in a long-term deflationary trend, and ultimately it will overwhelm all efforts to overcome it. However, those who think that the Fed & US Treasury are just going to sit there powerless to intervene are very much mistaken. The debt monetization & hyperinflation card is the last card they can play, but if (when) things get bad enough, they WILL play it.
WNC Observer...
The debt monetization card is already being played but to little effect. Real M3 is now about 18-23%. At 23%, using the rule of 72, the M3 money, credit supply is being doubled every 3 1/2 years. I don't know your definition of hyperinflation but a doubling of M3 every 3 1/2 years makes me damned uncomfortable. Perhaps that is why I have always avoided fiat currencies as much as possible. BTW, the best performing fiat currency of the 20th century was the Swiss Franc...it only lost 80% of it's value.
I believe that the Fed is doing all the inflating that they dare. I say this because the very low interest rates are causing the inflow of foreign funds to diminish. What foreign funds are going to rush into a market where the interest rate is well below the rate of inflation?
I will repeat once again...The Fed is between a rock and a hard place. If they cut rates any more they will scare foreign money away from US treasury issues. Without the foreign funds the current account defict cannot be serviced. If the Fed raises rates they will crash a very weak US economy.
The Fed has no magic levers to avoid the train wreck that we are all part of.
When debt monetization starts in earnest, then interest rates will be entirely market driven and the rates that the Fed sets will become totally irrelevant. The only thing the Fed will be doing at that point is buying US Treasury obligations, probably with a massive unloading of them by China and OPEC nations playing out at the same time.
You think 23% for M3 is high, you ain't seen nothin' yet! That could become a DAILY increase rate before this is all over.
Mac, River,
I've been doing well with the ETF's that short the S&P Financials, the Dow, the S&P 500, etc. I've certainly been doing better than the rate of inflation and feel inclined to let them run for now.
Do you see something I don't that would lead me to change my strategy?
Errol in Miami
stocks nominally could go up while in real terms going down. the dow in the mid-70s rallied from being down 50% to finish basically unchanged(went sideways) for more than a decade. I am not saying that it will happen, just that it could.
John,
Thank you for your thoughts.
I agree that gains can be smaller than they appear due to depreciation of the dollar. But even if no investment were able to appreciate faster than the dollar deprecitated, I would still consider a smaller loss of purchasing power to be better than a larger loss.
When adjusted for dollar depreciation, t-bills are in the red, gold is in the green and oil has done even better.
While paper assets make me nervous in the long term, I believe that I can still convert gains from shorting equities into gold or whatever six months from now. If I can't, I will have bigger problems than that on my hands.
Errol in Miami
Your strategy, like all strategies, will continue working until it doesn't.
It seems reasonable to assume that the bulk of the movement will be to the downside for a while, but we had that bear market rally after the Bear Stearns bailout, and if you were invested then you probably noticed your Financials short doing poorly then.
In a bull market everybody looks like a genius. In a bear market, it's tough to make money and concentrating on preservation makes a lot of sense. As long as you can stay ahead of the trend you should do OK. Your risk is that you stay short for too long, thinking the start of another bull market is just a fluctuation, and you may lose 10% or 20% before you decide you are on the wrong side and switch over. That could eliminate much of your profit. In other words, getting out 20% too early costs you no more than getting out 20% too late.
Your exposure to shorts should reflect your confidence that that market or sector or company will continue to decline. As it declines, you should be less confident that it will continue to do so, not more. Think about gradually pulling money off the table as things decline, and putting it in T-bills or whatever you feel is safe.
A bird in the hand, and all that.
GreenMan,
You're right that the shorts when briefly into the red after the BSC bailout. But I held pat because I was pretty sure the Fed cannot stop the debt unwind.
You wrote:
"Your exposure to shorts should reflect your confidence that that market or sector or company will continue to decline. As it declines, you should be less confident that it will continue to do so, not more. Think about gradually pulling money off the table as things decline, and putting it in T-bills or whatever you feel is safe."
Again I think you're right; the Financials are so beaten down that most of their downside potential is probably done. You've motivated me to get off my posterior and put trailing stops under my positions.
Errol in Miami
notintodenial, greenman, I do not see any upside for the stock market. Of course, there will be a few stocks that will make one money but why try to pick a needle in a haystack while at the same time playing against the insiders? I don't like that game. There might be a dead cat bounce to the upside but, imo, the fundamentals are not in place for a return to a bull market.
Watch the P/E ratios for the financials...when they get to about 7 or 8 to 1 then the game will become more interesting. But, keep in mind that the P/E ratios will only be known by us when the banks have once again become transparent and trustworthy...it will take some years.
The banks are insolvent.
Even JPM.
But TPTB will do everything, including discarding democratic institutions
to keep the game going.
See UBS/Parmalax conspiring to offlaod/hide debt ala Enron via
SIV's for details.
The Stock Market is being held up by the PPT. Note that we never get volume/
Advance/Decline Ratios anymore.
I have to watch the Big Board when the various MSM's show the Dow.
Amazing numbers like 5 to 1 declining vol yet the Dow is still positive.
Want to play trader? Watch the Baltic Dry Index. DryShips a proxy.
"We're seeing ships leaving Asia that are not full. We are living through a real economic slowdown. It is a latent crisis that will take time to disappear. I don't see it getting better before the end of 2009." "America is importing less, so is Europe. After a record year in 2007, where we had more offers than we could take on our ships, traffic between Asia and Europe has now fallen to a 94pc occpancy rate," he said.
Mr Saadé, who has just ruled out a bid for Hapag-Lloyd, said the oil spike was a scam. "This boom is artificial. Only speculation can explain the run up in price. One way or another, governments must put a stop to this." He said fuel now made up 60pc of his shipping costs. "We're cutting the average speed of our container ships from 22 to 19 knots. It's our only possibility," he said.
Lloyds List said the shipping industry will know when the first Asian loads begin for the pre-Christmas season in a month as whether this is the start of a serious slump. The anecdotal talk is that the picture is deteriorating fast. Note too that the Baltic Dry Index measuring freight rates for coal, corn, grains and such has dropped 23pc over the last month. A false alarm?"
Again h/t Ilargi TAE
"...the Financials are so beaten down that most of their downside potential is probably done."
We now have a neg savings rate in America.
There is no capital base.
The value of the $ must be maintained or the US fractures.
Here's where long term history works.
I keep returning to the Panic of 1907.
And when did we recover from it.
I argue August 1914.
The Depression? Dec 7, 1941
" "Central banks are paid to cause a recession now and then," said Fortis Investments Chief Investment Officer William De Vijlder. "Maybe it's a shock to put it like that, but that's reality."" h/t Ilargi, the Automatic Earth
We are now sliding into the Olduvai. The Gov't will be confiscating (gold-
maybe wheat!).
We've used cheap energy to paper over systemic problems (pushing debt forward)
since the Fed was created (XMAS Eve, 1913).
As we are not now increasing energy use (which we must to amaintain our debt structure, cash will be king and debt will mean slavery).
ETF's are derivatives.
You should constantly be moving into actuals.
As the Fed is working night and day to stop your shorting indexes.
Irrigated farmland, gas leases, cash.
And shipping, whichever way you think it will go.
Dryships a proxy for the Baltic Dry Index.
http://www.investmenttools.com/futures/bdi_baltic_dry_index.htm
Greetings to South Louisiana,
the problem with gold is that you only profit when you sell.
I have been in and out of gold since 1980.
I'm glad you own it and are doing well.
I'm trying to figure why I got a neg rating here.
The word "deflation"?
That I made $ in Treasuries?
People are worrying hre about the price of gasoline when they've lost $100k
in housing deflation.
Maybe the word "derivatives." They don't think there is more than $692 Trillion
vaporizing before our eyes?
Maybe it's only $10 trillion? Would I get a positive rating then?
;}
yours from Arkansas,
James
Conventional wisdom say so. Now, with the all those creative souls on Wall street and beyond, there will always pop up some new schemes based on derived derivations invested in Lala-land. Just wait see. And shouldn't that work, than you can always buy some debt - that's bankers.
Paal...You can put a fork in the 'new schemes base on derived derivation invested in Lala-Land...' CDOs Squared, SIVs, etc, will be remembered as the 'Tulip Bubble' of the first decade of this century. That model is over and we are headed for the biggest credit unwind the world has ever seen.
Get a bag of popcorn and watch the second half of 2008. The upcoming election will be about the economy, not Iraq.
River , can you still get popcorn in your neck of the woods ?
Over here it's a total ban on eating those salty little crackers , they are for the 15% efficient wrrrrooooooooom's only.
Sorry Paal...I must have missed something in your post. Yes, we can still get many brands of pop-corn, many of them microwaveable.
This works for a while, but eventually the creativity will find no more buyers.
I'm reading The Great Crash by Galbraith right now.
There were some very creative leveraging schemes back then, too.
aangel...I have read several book about the great crash and Gailbraith is by far the most entertaining. I really admire his command of language, writing style and witticisims.
"you cannot create debt w/o the promise of future energy growth."
link? remember it is supply AND demand, not just supply.
River: Look at Germany as an example. Since 1998, oil consumption down maybe 12%-oil price up 14X-money spent on oil up maybe 12-13X. I keep hearing that this shows a transition away from oil expenditures-sounds like USA fed guv accounting-maybe Henry Blodget can explain this one.
Germany is an interesting case, because of heating oil, which has been in a decade long process of being phased out. In the past, German homeowners/landlords in total had a noticeable effect on the oil market, merely due to the timing of filling their tanks - not small tanks, I might add.
Much of that heating is now done with natural gas, better insulation has played a role, increasing co-generation/district heating, along with increasing biomass heating (not merely wood stoves in a house, but district heating), and of course, solar hot water heating has become increasingly common.
And in turn, much of the fuel 'saved' has been burnt in larger, heavier, more powerful cars. That era may just be drawing to a close, roughly in time for people to buy newer, lighter, smaller cars now.
Or just returning to how they lived a couple of decades ago - walking, bicycling, taking the train. Germany can sink its expenditures much more quickly without people living noticeably worse off, something that most Americans may not realize.
Your comment on German conversion to Nat. Gas is spot on. Compare these two graphs from the Energy Export Databrowser:
Perhaps a nation can continue its economic growth while reducing its consumption of oil. But can it continue while reducing its consumption of oil and gas at the same time?
(I wouldn't count last years one time drop as a trend.)
Or, more generally, "can it continue economic growth while reducing its aggregate consumption of energy in all forms"?
The answer to that can also be "yes" if energy-intensive industries relocate to other countries and the country in question creates wealth using less energy (e.g. technology and finance), then buys those essential products from that other country. The energy is still consumed, but is accounted for elsewhere.
The greater question would be "can the world as a whole continue economic growth while reducing its aggregate consumption of energy in all forms"?
To a degree, by using energy more efficiently. I am sure diminishing returns set in at some point.
I am pretty comfortable with a general statement that "real economic growth requires growth in aggregate consumption of energy in all forms", but that allows a great deal of variance in the particulars, as in a specific country during a specific time period for a specific energy type.
Exactly. All those solar panels from China do not use German natural gas for manufacture, but they do use energy.
Cleveland wrote an interesting paper on this in 1984. The total energy savings due to efficiency improvements were shockingly low.
http://www.eroei.com/pdf/Energy%20and%20the%20U.S.%20Economy-%20A%20Biop...
good point. but don't you think that the solar panel factory might use solar panels to power their plant? also, show some figures. how much trade does germany or denmark do with china and does that make up for a drop in energy use in germany and denmark. a chinese worker/citizen uses a lot less energy per capita than a european.
between 1979 and 1993 oil usage didn't grow at all and yet world real gdp just kept on moving along.
THE BIG GLITCH
http://peakoildebunked.blogspot.com/2007/12/324-big-glitch.html
unless it's place where the sun shines 24/7/365 they can't
the factory's they use to make the silicon for the pannel's require such a constant supply of power due to the similar clean rooms and methods they use when compared to the silicon chip factory.
what if they use batteries and only run the factory during the day? or they use a combo of power systems. or they drastically cut how much power they use?
"then buys those essential products from that other country."
This only works with cheap shipping.
And the Baltic dry Index is having cardiac arrest now.
The Second Law of Thermodynamics kicks in.
Using energy more efficiently means using more energy -Jevon's Paradox.
right now there is a shortage of ships, but there was a glut some time before. shortages aren't forever.
using more efficiently doesn't mean using more energy. how did germany and denmark and italy reduce their oil consumption if jevon's paradox is true?
"Perhaps a nation can continue its economic growth while reducing its consumption of oil. But can it continue while reducing its consumption of oil and gas at the same time?"
what, are you trying to rebut the claims made by JD on his site?
BrianT...'I keep hearing that this shows a transition away from oil expenditures-sounds like a USA fed guv accounting...'
Well, it is. Germany is probably buying oil denominated in dollars. Check out what has happened to the value of the dollar since GWB took office. Purchasing power of dollar against a basket of commodities down over 40%. Of course there are those on this sight that will tell you the run up in oil prices has been caused only by demand. I will call BS in advance on that reply. If demand was so strong there would not be tankers full of crude sitting in the Persian Gulf, finished product being shipped out of the US (worlds largest consumer), and prices at the pumps dropping on the 4th of July, etc. If demand were so great there would be refineries going up to handle the 'unwanted' sour/heavy crude. The oil industry is not stupid, they saw an increase in demand coming and had an opportunity to build out refineries to handle heavy/sour crude long ago. Instead the number of refineries in the US has roughly halved. Why?
How long do you think that the US $ can remain the world reserve currency when it is declining rapidly and the US economy shows little sign of life? If the dollar decline continues at some point all foreign central banks are going to head for the exits and the dollar will crash rapidly. The reason that foreign bankers have not already done so is that no one has a solution for a new world reserve currency...but that will be solved.
River: Why all the effort on spin? The incredible increase in money spent on oil products in all the countries you mentioned (including Germany) since 1998 isn't something to be debated. The rate of increase isn't sustainable-a 40% price cut doesn't help when price is up 12-13X-it just changes it to 8.5X higher. The transition starts when expenditures on oil products as a % of a country's wealth/income starts to decline. It hasn't started yet (at all).
BrianT...No effort was put into 'spin' on my part. The 40% drop in purchasing power of the dollar is spin?
The dollar is going to continue to decline because the Fed can do nothing to stop it, namely raising interest rates, without crashing the entire economy.
Oil prices will come down. There is now evidence of real demand destruction...not just in the US but in many oil consuming countries. In the face of real demand destruction the games being played in oil commodities will soon end.
Go here and do a bit of reading:
http://peakoildebunked.blogspot.com/
Especially, read this:
#366 Futures Prices Dertime Physical Oil Prices
...snip...'Dated Brent, which acts as a price marker for many international grades, is physical crude traded on an informal market, rather than a regulated futures exchange. This lack of regulation poses problems for oil producers and consumers seeking a fair price, said Robert Mabro, director of the Oxford Institute for Energy Studies and a leading Brent expert.
"There are regular squeezes in the Brent market," Mabro said. "In the trading community, people are fed up. This general view that you can do whatever you like in an informal market is okay, as long as you regulate the market a bit. But if it's a free-for-all, you're back to the cowboy age."
A typical Brent squeeze involves a company quietly building a strong position in short-term swaps called contracts for difference, or CFD's, for a differential not reflected in current prices. The company then buys enough cargoes in the dated Brent market to drive the physical crude price higher, which boosts the CFD differential, Mabro said.
The company may lose money on the physical side, but it's more than compensated from profits on its offsetting paper position in the short-term swaps market, Mabro said.
"The whole trick is to collect more money in CFDs than you lose on the physical squeeze," Mabro said. "People seem to do it in turn. It depends on who's smart enough to move in a way that nobody notices until it happens."Source'...snip...
That scheme will have precisely ZERO long-term effect on oil prices, unless they keep the oil off the market. Whatever amount oil goes up when they buy physical cargoes will go down when they sell. At most that is a scheme for insiders to make money churning the price up and down a bit.
If keeping the oil off the market in that fashion were responsible for the run-up in oil prices, they would need to be sitting on more oil than the US strategic petroleum reserve. They aren't. In fact, they don't need to. You've just explained how they can make money without having any long-term effect on the price of oil.
Oil prices are set by supply and demand. Any scheme that takes oil off the market temporarily will have only a temporary effect.
River,
would you address these questions I made:
http://www.theoildrum.com/node/4253#comment-374517
if you have time.
I don't understand the argument that assumes OPEC has capacity, but it is not willing to normalize the price.
Can you elaborate (please read the post I linked, quite short).
Sure. And go back up. And jump all over the damned place. Say something useful. WHEN will it fall? How much? For how long?
FYI: demand destruction in one nation does not equal demand destruction globally. Show me any proof of a global drop in demand. None? OK, thanks.
FYI: Even if global demand destruction occurs, and it will someday as economies continue to fall apart, that won't matter if production is falling faster.
FYI: Latest decline #? 5.2%. And I'd bet that's low. The difference in production from Russia's increasing production yearly to now declining is nearly 1,000,000 barrels a day in and of itself. That's new. This year. Funny, but I haven't seen OPEC, or anyone else, step up and say they've got it covered.
NOTE TO STAFF: Why is JD II allowed to spam the site with that BS website? I've spent time there. Anyone who has knows two things: logic dopes not reign and JD runs from a fight when he's shown to be wrong. So, it's one thing to have his blog in his profile, it's another to spam the site with it, isn't it?
Cheers
I'm beginning to agree.
It's one thing to have a critical discussion with people who don't agree.
But having people shouting, spamming and using no data to back up their arguments.
I've tried to ask for clarifications and refutations to some counter-arguments (in civil manner, mind you) - but nothing appears to be forthcoming.
I though this was supposed to be a dialogue - and not a shouting match.
The only point of allowing trolls is that they strengthen our resolve and for that they are good :)
Bull. Almost no one on this site argues demand is the primary driver. Peak oil isn't demand-based. Your entire argument is a straw man.
And how many times do people have to explain to you why oil is sitting in tankers in the Persian gulf? If there is so much extra oil in the world, why are the tankers only in the Persian gulf? Once again, the tankers aren't there because of over-production. This isn't Lucy in the Candy Factory. The Iranians know how to turn off the assembly line. If they didn't want the oil mobile, they wouldn't keep pumping it and putting it in tankers. Just because you don't understand what is going on, doesn't mean there isn't a reason.
Finished product is still being imported to the US at greater rate than it is being exported. The argument about "finished product being shipped out of the US" is completely bogus.
It is small wonder that we have fewer refineries now. The refineries we do have are under-utilized. Only a moron would build more refineries when they don't use the ones they already have.
Yes, the oil companies and anlaysts did see the demand increase. What they didn't see was the net energy decrease (supply less declining EROEI less net exports). There's that straw man again. You are never going to understand what is going on if you try to explain it by demand.
The oil companies clearly got caught with their pants down in capacity for heavy crude. They are scrambling now, as is clear from any number of projects, from installing cokers like mad to huge refineries belated being planned in Asia. If they saw the demand increase coming, and there's so much oil out there, and the prices are high only because of speculators, then why did they get caught with their pants down? Clearly, because they didn't see the decline in light sweet crude coming. And if you understand that net energy supply is declining, then everything else falls into place as well.
Iran is reducing the amount of floating storage:
Tehran cuts number of supertankers idling in Gulf
Bloomberg
Published: July 02, 2008, 00:08
Tehran: Iran, Opec's second-largest oil producer, cut the number of tankers it has idling in the Arabain Gulf to 11, from 15 a week ago, ship-tracking data show.
The 11 very large crude carriers, or VLCCs, have a storage capacity of about 22 million barrels. They are floating near the Kharg Island crude-oil loading facility or the nearby Soroush Terminal, according to AISLive data on Bloomberg.
http://www.gulfnews.com/business/Oil_and_Gas/10225264.html
Same here. When I looked closely it was everyone was switching over to E10.
That's not the case here. We only have E10, and it's been that way for years. (Environmental reasons, presumably.)
I expected the price to increase because it's a holiday weekend.
But the same thing happened over Memorial Day weekend. I was expecting an increase, which is what usually happens, and instead, the price went down.
Obviously you didn't look closely enough. What you have done is derail a detailed post meant to make intelligent people think a little more in depth about the problems and possible interim solutions to PO.
Ethanol is not a solution unless one considers starvation of large portions of the world population a solution.
Why don't you place your pro-ethanol posts where they belong? We are well aware of your agenda.
Ethanol is not a solution unless one considers starvation of large portions of the world population a solution.
If I were Intelligent I might know of what you speak; but, inasmuch as I'm, merely, a cerebrum-challenged ethanol supporter, maybe you can give me an example, or link, or something to back up this claim. You know, something like: Thousands die in Bangladesh due to high cost of field corn, or Corn to Ethanol kills hundreds of villagers in Zimbabwe, or some such.
Oh, puhleeze, K, let's not be utterly bonehead stupid about this, shall we?
I realize that, at least judging by your posts, you seem to be shilling for people who thoroughly enjoy suckling parasitically at the luscious Federal subsidy teat instead of contributing usefully to society in their line of business, or else finding a line of business that they are competent enough at to earn money instead of losing it, but, still, this is just too much.
Of course you're not seeing those headlines, and most likely neither you nor the rest of us ever will no matter how many people might starve. Why? Because field corn is an utterly boring bog-standard commodity that goes into a big pool, a pool which very substantially overlaps other big pools of other equally boring bog-standard commodities. So all that the Byzantine, overcomplicated, expensive, corrupt, stinking, oil/gas/coal-to-liquids program called corn ethanol can ever do is to drain all those interlinked pools, all the grain commodity markets, together.
So people in Bangla Desh or wherever will never be malnourished or starve "because they can't buy field corn." They will be malnourished or starve simply because the grain pools are drained due to burning huge quantities of whatever grain for fuel, driving prices out of sight.
Because that's not a complicated concept at all, I think you know it perfectly well. It's just that you and/or the folks you seem to shill for are so busy enjoying your wholly undeserved free luxury ride that you simply choose to ignore the massive problems it's causing. Shades of that saying about the guy who won't understand something when his
livingfree ride depends on not understanding it.This is for you, the repeater of disproved ethanol facts who seems to think that repeating them will make them true.
Insane U.S. Ethanol Policies
And before you try to twist this into a weak dollar problem, those foreign investors can only acquire those plants because they are not profitable now.
Also take note of this little gem:
Biofuels behind food price hikes
If the food shortage caused by ethanol becomes great enough then I hope that anyone who advocated this boondoggle is tried for crimes against humanity. Stuart did the math a while back and showed that in a very brief time period (a few years), biofuels would begin to force an "eat-or-drive" question into the open. It appears that time is coming.
I find it odd how nearly everyone here agrees that oil is critical to food production and yet when it come to food prices the major factor is ethanol.
Something doesn't ring true in that argument.
I also find it odd that it is okay for anti ethanol posters to have an agenda, but ethanol supporters are not allowed to have an agenda.
I also resent the repetetion of the "crimes against humanity" bull shit. Crimes against humanity should be well defined and not some vague concept to be thrown willy nilly at someone you disagree with.
The eat or drive decision will have to be made. Some will choose to eat and some will chose to drive. What is wrong with that?
Are we going to force farmers to accept less than the energy value of their crops? All corn can go for animal feed if that is what is wanted. Just price it appropriately at about $12-15/bu. (where ethanol will be too expensive if gasoline doesn't go up more).
Go to the grocery store and see how many items are corn related. Not many. The produce section hardly has any corn except when corn on the cob is in season. Canned vegetables same thing except for cans of corn. No corn in the canned fruit aisle either.
There is corn starch and corn meal in baking supplies but that is about it. Of course the meat counter is where corn has a large impact, but for now the impact is positive as hog and cattle feeders liquidate their herds due to feeding losses. Soft drinks are full of high fructose corn syrup, the nemesis of all diabetics and the overweight.
Eggs are directly related to corn and have about doubled in price. But compared to everything else in the store, they are still the biggest bargain there. Dairy is somewhat related to corn, but cows mostly eat grass and hay.
Why is it that when oil doubles, triples or quadruples no one accuses oil producers of "crimes against humanity" when clearly oil is a major factor in food price increases? Could it be that those who ignore oil's impact on the cost of food have an agenda? Or can oil producers "commit crimes against humanity" with impunity by pricing oil out of reach of the world's poor?
The fair thing to do is try them as well as speculators, refiners, oil executives and share holders of oil companies. Let's throw in OPEC which is an illegal cartel and try them for "crimes against humanity" too. Why single out ethanol supporters for prosecution?
Spite?
"I also find it odd that it is okay for anti ethanol posters to have an agenda, but ethanol supporters are not allowed to have an agenda."
All you're saying is that ethanol supporters and anti-ethanol posters disagree.
Your post was a long pathetic whine. You throw the word "agenda" around like some incantation.
The price of oil is high because of peaking production. The price of corn is high because of a government subsidy to a possibly negative EROEI project - making ethanol from corn.
The price of food is high because of acreage going into corn to supply this subsidized project. So not only does the price of corn spike, so do all the crops whose acreage went to corn.
Nobody is singling out ethanol supporters for persecution. You are paranoid.
I'm sorry your ethanol investments didn't pan out.
I hope that anyone who advocated this boondoggle is tried for crimes against humanity.
This seems a lot like "singling out for persecution," to me.
Step 1 -
Eliminate the $4.5 billion/yr corn ethanol subsidy.
Alan
“Go to the grocery store and see how many items are corn related. Not many. The produce section hardly has any corn except when corn on the cob is in season. Canned vegetables same thing except for cans of corn. No corn in the canned fruit aisle either.”
My Dear X,
May I suggest a bit more research about the role of corn in our food supply.
“If you are what you eat, and especially if you eat industrial food, as 99 percent of Americans do, what you are is corn.” Michael Pollan
http://www.ecoliteracy.org/publications/rsl/michael-pollan.html
King Corn is also a good video introduction to the role of corn.
http://www.pbs.org/independentlens/kingcorn/
Are we going to force farmers to accept less than the energy value of their crops?
How about we treat them like other business owners, and if they plant too much of a specific crop, prices fall and the market signals for them to plant less, or plant something else. That's how other businesses tend to work. But in the U.S., we have a glut of corn, so the farmer has to be protected, so we mandate an artificial demand for corn, and now everyone is scrambling to grow corn to meet the artificial demand. In the mean time, corn supplies got squeezed and consumers, ranchers, poultry farmers, etc. got hosed. But the guy who farms 250 acres in Iowa saw the value of his land increase by a million dollars. Wealth transfer from the rest of us to him, courtesy of the government.
Go to the grocery store and see how many items are corn related. Not many.
This pro-corn site begs to differ:
http://www.ontariocorn.org/classroom/products.html
Why is it that when oil doubles, triples or quadruples no one accuses oil producers of "crimes against humanity" when clearly oil is a major factor in food price increases?
Because oil prices are going up for reasons other than government-mandated demand. Ever hear of Peak Oil? If Peak Corn was at the heart of the price increase, nobody would be complaining about people like you trying to defend having your hand in our pockets.
X, the regulars here are "Oil" Guyz. They ain't never going to love us, Pal. (Remember, it's hard to make a Man/Woman understand when his/her economic "interest" lies in Not understanding.) But, there are probably a lot of "Readers" that are interested in what you say; so don't "give up."
I am not an "oil guy". I have no economic interest in oil or ethanol, other than my own budget.
So "don't" characterize this as some sort of "agenda", because "some readers" actually think, on the evidence, that ethanol is a "rat hole" down which we don't want our "tax dollars" tossed.
I.e., people are down on ethanol, because it's a distraction and not a solution. No agendas, no conspiracies, no oil guyz.
The whining of the "ethanol guyz" today makes me think that it's hard to make someone think straight when they've made crappy investments that they're desperate to recoup.
Also, peak "quotation marks"?
Those cattle producers, and hog farmers didn't mind when my tax dollars were Subsidizing "Their" Feed to the tune of about a Dollar a bushel, did they?
Nor do they count the $700 Billion, and 4500 lives lost in Iraq as a "subsidy." They, also, don't seem to care much about the $70 Billion, or so, that the American Motorists are saving as a result of having Ethanol available.
As for the bankruptcies? Yep, you can bet on it. The Oil Companies are, almost certainly, going to end the year in violation of the mandates (although Verasun, for an example, has 300 Million Capacity ready to go;) but, the "fine" will be miniscule compared to the possibility of wrecking an industry that will cost them hundreds of Billions over the coming years.
It doesn't really matter, X. Gasoline is still $4.11/gal, and it's not going to be appreciably cheaper for any prolonged period of time. The Die is Cast.
"Nor do they count the $700 Billion, and 4500 lives lost in Iraq as a "subsidy."
I TOTALLY do consider it a subsidy, though I am not a farmer. In fact, I consider fully half the military budget a subsidy to the petroleum economy, indeed, our "way of life", and have said so repeatedly. Indeed, I teach it to my students, right along with the idiocy of the ethanol subsidy.
Ditto the subsidies for feed to cattle and hog producers. There is no free market, nor has there ever been.
But that doesn't negate the issue of the subsidies to corn ethanol, and the very marginal, if not negative, EROEI.
I am rather skeptical of your "$70 billion saved" remark. Do you have a {reputable} source for that?
sgage, this Iowa State Study was completed when gasoline prices were a bit lower than at present. They found a savings of between $0.29 - $0.40 gallon. We could assume, I'm sure, that the savings would be a bit more now.
http://www.card.iastate.edu/publications/DBS/PDFFiles/08wp467.pdf
Also, Branchi, at Merril Lynch studied this subject quite extensively, and came up with 15% which would put us about $0.60 gal ( about $84 Billion.) I kind of split the difference between the two.
this Iowa State Study was completed when gasoline prices were a bit lower than at present. They found a savings of between $0.29 - $0.40 gallon.
So they found a "savings" that is less than we pay for the subsidy. In other words, if we add the $0.51/gal subsidy into the mix, then there is an overall cost (ignoring things like the impact on corn and natural gas prices) of between $0.11 and $0.22/gal. You would hope that the savings was at least as great as the subsidy.
But there are several problems with the study itself (often the case with these non-peer-reviewed studies). Among the more serious:
So, what does that mean? If gas prices fail to keep pace with oil prices - and demand has definitely softened as oil prices has skyrocketed - that is credited to ethanol. There was no attempt to quantify the impact higher oil prices has had on refiners margins. That's one reason their r-squared values are only in the 0.6 to 0.7 range.
And you have to love this piece:
The availability of ethanol essentially increased the “capacity” of the U.S. refinery industry and in so doing prevented some of the dramatic price increases often associated with an industry operating at close to capacity.
Yes, thank goodness there have been no dramatic price increases.
No Bubba, the $0.51/gal "tax credit" (remember when you wrote on this blog that a "tax credit" isn't really a "Subsidy" when applied to the oil companies) applies to only 9 Billion Gallons of ethanol. The Savings that Ia State, and Merril Lynch found applied to All 140 Billion Gallons of Gasoline sold in the U.S.
Ex. $0.45 X 9 Billion = $4 Billion. $0.50 X 140 Billion = $70 Billion. Big Dif.
Any savings in oil product prices attributed to ethanol have been more than wasted by the shameful way the auto-companies have been able to use the flex-fuel exemption to cheat on the CAFE standards. IMO we really are in a situation where the consumers have to feel plenty of pain near term, in order for the preparations for PO to be started. Had we drilled ANWR ten years or so ago, such that it was now near peak production, we might not have had hybrid cars (which have saved us as much demand as this extra drilling would have satisfied), so we would have roughly the same prices as today, but an fleet that is even less efficient than is current today. The only cure for out liquid fuel crisis is to make an agressive a substantial transition away from dependence on liquid fuels. If we are going to incorporate biologically derived fuel as part of the solution, we need to pay attention to the thermodynamic efficiency of the overall solution. Ethanol is a poor choice on these grounds. If we are to propose agricultural inputs as energy solutions, lets make sure we get the most bang per bushel out of them.
Nor do they count the $700 Billion, and 4500 lives lost in Iraq as a "subsidy."
It is a subsidy for the corn farmer as well. Or have you forgotten that they are as dependent upon petroleum as the rest of us?
They, also, don't seem to care much about the $70 Billion, or so, that the American Motorists are saving as a result of having Ethanol available.
LOL! I have heard that one before:
http://i-r-squared.blogspot.com/2008/07/show-me.html
The Oil Companies are, almost certainly, going to end the year in violation of the mandat
Care to back that allegation up? Or is this like so much of the other mud you threw out there about oil companies, and then couldn't back it up when I called you on it?
Sure, as soon as you back up your assertion that E10 is 2.5% less efficient than regular unleaded. No "Opinions," or writings from Your Blog. Show me where it was tested. I showed a test from the Univ of N. Dakota, and Mn State at Mankato that says it isn't. You didn't like it. Where's yours?
As for the oil companies: they are not, at present, using enough ethanol to reach 9 Billion Gallons at year-end; and, since they are allowing capacity to sit idle, it doesn't look like they intend to. HINT: we started the year with about 8.2 BGY Capacity, and we've slowly built to 9.2 BGY capacity. They would, obviously, have to use every drop of capacity from now till the end of the year to make their mandates; but they're not doing it.
NOW, about that 2.5%?
HINT: ethanol has ~60% of the energy density of gasoline. Get over it.
Ethanol is 113 Octane. Gasoline is 86. There's more to life than BTUs. Hint: The "Blend" makes a world of difference in any individual engine.
Were the ethanol to be used in engines designed for 113 Octane (i.e. higher compression), that would considerably improve the thermodynamic efficiency considerably. A big part of the problem is that ethanol is being touted as an easy replacement for gasoline for existing gasoline designs. It is basically part of the distraction that BAU can continue. Distraction while heading off the cliff can have fatal consequences.
I showed a test from the Univ of N. Dakota, and Mn State at Mankato that says it isn't. You didn't like it. Where's yours?
Are you kidding me? I have linked to plenty of studies that were not paid for by a vested interest as yours were. Consumer Reports?
http://www.consumerreports.org/cro/cars/new-cars/news/2006/ethanol-10-06...
How about Car and Driver?
http://www.caranddriver.com/reviews/hot_lists/high_performance/features_...
Or how about the DOE? Do they just have their facts all screwed up? Check their ethanol mpg ratings:
http://www.fueleconomy.gov/
As for the oil companies: they are not, at present, using enough ethanol to reach 9 Billion Gallons at year-end
I didn't ask you to repeat your claim. I asked you to back it up. Making claims is not backing it up. Source it.
They would, obviously, have to use every drop of capacity from now till the end of the year to make their mandates; but they're not doing it.
Yes they are. They are using far more than required to meet the mandate. (See, I can do it too).
NOW, about that 2.5%?
You really do lack scruples, don't you? Slander is just fine from you, as we have seen in the past. You will back it up only if I provide something I have already provided. OK, back it up. Don't worry, I know you can't. Just like you couldn't the last couple of times you threw out gratuitous slander against oil companies. Of course that's just what I would expect from an ethanol lobbyist: Ignore the facts, present only one side, and slander the opposition.
No, Robert. NOT e85, E10! We're discussing E10. I challenged you to put up a study that shows E10 had 2.5% less efficiency than gasoline.
You promptly put up links concerning E85. Concentrate. It's E10.
I'll Wait.
I challenged you to put up a study that shows E10 had 2.5% less efficiency than gasoline.
No, you challenged me to put up a study backing up "my assertion" that E10 had 2.5% less efficiency. Now you try to concentrate. It wasn't my assertion, it was a claim in a report I quoted. And if you read the actual report, you will see exactly where they got that number.
But, having said that, there aren't a lot of straight tests with E10 versus ethanol. The theoretical drop with E10 is around 2%. As I showed with E85, the actual drop there is substantial. The EPA says:
With regard to fuel economy, the theoretical change in fuel economy as a result of the addition of oxygenates to gasoline is in the range of a 2% to 3% reduction in fuel economy. Existing research indicates that real world fuel economy changes correspond to changes in energy content.
Link: http://www.epa.gov/oms/regs/fuels/ostp-3.pdf
Even the ethanol lobby admits to a 1.5% drop on E10:
http://domesticfuel.com/2005/09/19/ethanol-fuel-economy-study/
So, while you grasp at straws (run the numbers - 1.5% from the ethanol lobby versus 2.5% in the paper - and let me know if that substantially changes the conclusions of the report I quoted), it is par for the course that you have refused to back up the slander that you made. It was your claim that refiners were going to end the year in violation of the mandate. As I predicted, you wouldn't back it up. You feel like I should be more responsible for digging up evidence of a claim from a story I quoted than a claim you personally made. Pathetic.
RR, although the ACE study is almost a decade more recent than the other study it's still three years old. However, I've stated on this blog that I will accept 1.5% decrease with E10. That's NOT 2.5%. It's 40% Less. It, also, puts Missourians "ahead of the game."
The BIG way we all win, of course, is: that's 600,000 Barrels of Gasoline/Day that we don't have to ship $78 Million/Day overseas to get. What's that? $36 Billion Yr that stays in OUR economy?
And, I don't know how much that six hundred thousand barrel reduction in gasoline demand affects our price of gasoline; but, I bet it does, don't you?
http://www.bloomberg.com/apps/news?pid=20601072&refer=energy&sid=aj.h0co...
the regulars here are "Oil" Guyz
HARDLY !
Alan
Again, as usual, you totally ignore facts inconvenient to your agenda of lies and propaganda.
In Vermont, we call it cow corn. It has to be knee high by the 4th of July:) Hay and grass only take you so far.
http://www.ext.vt.edu/pubs/beef/400-012/400-012.html
edit: not sure why this posted so far down. The quote was from X's post quite a bit higher up.
That's the way threading works. Your post is further down because it's underneath other replies that generated a lot of their own replies.
Your post is in the right place. You can see what each comment is in reply to by click on the little icon with the single speech bubble and the up arrow (above each comment).
A few factors are driving up food prices:
1) Higher costs of oil and natural gas. This is due to both dwindling resources and industrialization.
2) Population growth. Why don't the baby makers come for as much criticism as the ethanol production lobby?
3) Tax and regulatory support for biomass energy production (both ethanol and biodiesel).
4) Industrialization. Rising East Asian living standards shift them up on the food chain. More meat consumed. Funny, the people who eat meat do not criticize themselves as much as they criticize the ethanol producers.
While corn ethanol subsidies should stop we also have other problems that ought to get more attention.
That happened around here as well, seven cents off the peak of a couple of weeks ago. It did seem pretty counterintuitive to me, in a week where the oil price range seems to have jumps from mid 130's to mid 140's.
Perhaps, it's the "Diesel"/gasoline conundrum playing out. ie: If you produce enough Diesel, you have an "oversupply" of gasoline.
What are Diesel prices doing in your neighborhood?
Can't be too many places dropping that fast. Nationally the prices are still slowly rising. Gasbuddy.com shows it just went above $4.11 nationally. Around here we've been $4.18, except that the cheapest stations have been rising. That may change after the weekend.
No drops here recently. In the past I have often noticed that gasoline prices around me aren't always doing what they're doing in the rest of the country. It is better to go by national averages than anecdotal stories about specific localities.
I will say that a drop in price over the holiday is not out of the question. If refiners over-estimated the demand and refined too much gasoline, they'll need to get rid of it somehow. Gasoline has a pretty short shelf life. But that's really only a temporary blip. Best not to make a big deal out of a short-term trend, as some people clearly have.
What makes you think the price will stop there?
I think the caveat 'past prices are no guarantee of future performance' applies here...
Well, I did say "at least" :-)
I agree on the caveat. I think it gives us one idea about a price that may "break" the economy. OTOH, IIRC there is a good deal more debt than in the past. If this chart were adjusted by people's ability to pay for a greater percentage assuming their debt service is non-negotiable, we may end up with a lower peak price. It's good to know where things ended up last time. Too bad the reasons are different this time.
but the % spent tends to decline during a recession so that lends more credibility to my oil price mini-bubble...
At $6+ per gallon the resulting demand destruction would lower the percentage of income spent for energy. But the economy would shrink and so would personal income and that would tend to raise the percentage spent on fuel.
The link uptop The year everything changed (The Sydney Morning Herald) summarizes everything in a plain for everybody-to-understand-way.
I could not have put it better myself. Imagine if politicians read that article and at the same time understood its future implications. In reading the news nowadays in conjunction with “the numbers” I am in perfect agreement with Mr. Ian Verrender of The Sydney Morning Herald : THIS is the year everything changed.
Furthermore the MSM talk about Peak Oil in a much more straight forward manner.
The only thing missing right now is a perfect hurricane or some more saber-rattling in ME.
My first thought was "the year everything went downhill".
Otherwise +1
I'm seeing a lot more articles like that. Expressing the feeling that something fundamental has changed, forever.
Though public opinion hasn't caught up. CNN had a story about the surge in homelessness. Many of the new homeless are families living paycheck to paycheck. Paycheck to paycheck doesn't just mean they spend everything they get; they spend everything they get on necessities, with no discretionary income. High gas prices are killing them.
They interviewed one young mother who had been living with a roommate to save money. She was working and going to school in the evening. Then the roommate got sick and couldn't work, and they all ended up being evicted.
It ended with the young mother saying that it would be different for her child. That her daughter wouldn't have to worry about money, and would have everything she needed, and the things she wanted, too.
Sure feels like it. Ran into this quote on anther forum, seems appropriate.
I agree with all this, and then you go on to say ..
Rule of thumb says that almost 90% of all infrastructure on this planet has been buildt since WW2, due to the energy booms,ingenuity, et al, but global population has "just" DOUBLED+ over the same period. In other wortds there are more than enough living space in readymade homes and housings to accommodate us as is, e.g roof above or heads.
I predict that in the years to come more and more families will join other families to buy ONE ALREADY EXISTING HOME and split the expenditures. Some refurbishing and rearrangements, common kitchen and bathroom, more ... My point here is that 100 years back people lived jam-packed, and I see that come back again. (5 cents only)
People still live jam-packed in many countries. Including many countries with a fairly high standard of living. Even NYC is thinly populated compared to other large cities of the world.
I expect people to jam into city apartments, as they do in many other countries. And for homes to house several generations of a family (as is still custom around here, especially in Italian neighborhoods). The brother in law on the couch may not be such a nightmare...if he's paying rent, and you're having trouble paying the mortgage.
Personally I see the jam-packing taking place in the countryside, back on the land if you will. I have trouble to see so many millions of people “shine each other’s shoes” or “cutting the neighbors hair” for a living. The variety of various works we (in the west/ big cities) enjoy today will dwindle, it will boil down to : is you work important for the greater society or not ?!?
Primary needs like, farming and food handling will always be in high demand as I see it. NYC is a very bad place for all the logical reasons IMO, in a future scenario.
No, the best place to be will be in the city, the bigger the better! Yeah, that’s the ticket, the city. All you folks who want to survive just flock to the city. The country’s full of bugs and nasty critters and stuff, no reason to want to go there. Yeah, that's it.
That may be where we eventually end up (if we're lucky), but I don't think it will happen that fast. We may even have a resurgence of factory-type jobs, as globalization unwinds.
Obviously as globalization unwinds your city/factory scenario will return, but...
100 years ago some 3/4 of the Norwegian population lived on the countryside and a 1/4 in cities/urban. Today this is flip-flopped.... due to globalization and the agri-boom. I believe these numbers go for the entire industrialized world.
Now if I have learned anything here on TOD , it must be that (cheap) energy is turning against us , and with some latency thereafter it will even shrink ....... and further down the line it’ll get really scarce.
In such a setting there is no way 3-5% of the population (farmers) will be able to feed its nation, and those new urban high-raised greenhouses popping up in MSM now and then are just a stupid fad, I won't even bother to venture into the winding explanations of how costly such a system would become ...... The sun is only yielding the equivalent to that building’s rooftop area no matter how tall they are. Photosynthesis yields/area/insolation intensity.
The idea of high-rise farming is so off the wall that it makes one wonder what idiot would propose such a system. For starters, the building would need to be higher than all the other buildings to the south (in the NH) and the buildings/people to the north would need to allow the shading of their structures. This illustrates the big problem of solar in the city, which is, who gets the sunlight? the question of "solar rights" must be addressed before there could be any serious large scale use of solar, else your neighbor could defeat your efforts by building higher and shading your system.
Living in a city may be "efficient" for the individuals, who can use less energy per person, but that energy must be supplied from outside the city. The same is true for food, as the population density is so high that food (which is a form of solar energy, after all) must be imported from elsewhere. Were it possible to build with the requirement that each parcel of land had access to sunlight, thru solar zoning or height restrictions, then high density living could be made to work. But, doing so would imply something like a limit in building heights to 50 feet and the placement of streets along an East-West and North-South grid, much like the older small towns of the Midwest that were built on the rectangular grid pattern of the Philadelphia model of urban planning. Forget life in suburbs with lots sprawled out along winding streets ending in cul-de-sacs (like the place where I live).
E. Swanson
BD thanks for elaborating the "winding explanations" of these "architectural-stupid-stunts". For the most part I see those urban-farm-houses as architects-wanna-help-to-save-the-world kinda thing. But they fail to have the reality-skills necessary to pull it through (IMO)
I saw a reportage the other day, someone willing to reconstruct an old worndown building ..... it was supposed to go break-even within "short time" ............ from the revenue from the produce ... :-) ...man
Those dopey "vertical farms" are a boondoggle. I don't expect they'll ever be more than a toy.
However, I think Stuart is right - at least in the short-to-medium term. The Green Revolution will probably be among the last things we give up as energy gets more expensive. Energy will become scarcer and more expensive, and I expect there will be rationing of some sort. And the privileged industries will be "guns and butter" - the military and agribusiness.
Mirrors and grow lights. If lights work for MJ, why not everything else? We are planning to going virtually all electric, are we not?
Also, why would they be inside (different poster)? If you're growing food in the building, why keep exterior walls?
Cheers
WTF??? Have you utterly taken leave of your senses??? Did you think about your post for even a femtosecond???
Now, I admit that once, I actually saw luxury vegetables growing under electric lights inside the supermarket in what is now LaLaport, near Tokyo at Funabashi on the Keiyo line. That was only because a series of hurricanes had entirely destroyed the crop (so much for the prognosis of ultra-localized ag, that foolishly risky holy grail of some around here, but that issue is for another day.) So, yes, it can work temporarily in an upscale market for luxury vegetables.
But who, besides Bill Gates, could possibly afford MJ prices for basic grain??? Do you have any idea how much energy grow lights consume for how little energy is returned as plant material??? No, I didn't think so. Please think about it for at least another femtosecond. And please remember that we may be needing food plants to be at least a modest energy source rather than the sink they seem to be now.
People are getting scared. Look at the vociferous reactions to simple comments. Wow. Here's yet another that pretends I'm not basically a doomer. It also assumes I see no problem with the energy side of the idea. It assumes a lot.
Leanan stated she saw little chance of them being possible. Another poster made a comment about growing inside. I made two points: no walls or artificial light. Of all the problems to solve in growing food, I'd be willing to bet getting an efficient grow light made is one of the easier tech issues to tackle. I also mentioned mirrors.
But the poster above responds, vociferously, to grow lights and ignores knocking out walls and using mirrors.
People are getting scared.
Cheers
Anybody here tried to grow plants indoors? I have. And so have a number of my friends. Can you say: aphids, white flies, spider mites? We all gave it up. It is a very complex procedure requiring adequate ventilation, light, temperature, humidity, etc.
hydroponics has been done commercially and in Arizona no less.
http://en.wikipedia.org/wiki/Hydroponics#Commercial
Looks easy enough here:
http://www.uclick.com/client/wpc/wpswi/
And having those who harvest in tuxedos and evening gowns makes farming oh so hip!
I have extensively. You are right about ventilation. The setup I once a few years back had six 1000 HPS watt lights and 2 400 watt metal halide lights for seedlings. Without air cooled sealed hoods the temperature became unmanageable once the outside temperatures rose above 70 degrees Fahrenheit. For general ventilation a Dayton 3500cfm fan used for HVAC purposes and twelve inch diameter galvanized duct was used to exhaust the stale air. Intake to the room was large - 48X48 with an electrostatic filter to block dust and insects. The nutrient was also chilled using an aquarium chiller since temps above 60 degrees would hurt the roots ability to uptake oxygen. And yes, insects could be a pain! Neem oil is your friend, also for mold and mildew. Forget about predatory insects, expensive and a pain in the ass. The idea is not to let bugs in. Never bring a plant in that is from another site that is absolutely clean or you are courting disaster. Also very important is quality metering for PH and EC (I prefer EC over dissolved solids, I think it is more accurate and the meters last longer). General Hydroponics three part solution is the standard - very consistent and holds it’s PH well. You could also try soilless mixtures with peat or coir as a base but it is too messy and the dust is uncontrollable
Its hard to imagine that from out here in the far burbs. There are just too many unoccupied houses. Clearly, but for want of a rationalized transportation system, and the still uncomplete repricing of the housing there is room for more even at one family per house.
My wife and I have two housemates in our 2000 sq ft home in Oregon. Prior to our move to Oregon we both owned our own homes and had never lived with housemates. We made a conscious decision to make an effort at "microcommunity", and so far it has worked well, although we still have a lingering hankering for our own "private" space. Main points in our decision process:
> expand our skill set by learning to live closely with other people
> make money on the non-discretionary side of the economy (housing)
> generate under the radar cash flow
> lower carbon footprint by better infrastructure utilization
> look for candidates to support our "age in place" plan
liferaft, thx for sharing. I'd say you have done the smart thing. But a little unclear, is your house two selfcontained "flats" or do you share some rooms ?
Thanks. We've changed some pretty fundamental things about our lifestyle, yet live in a fairly conservative working class neighborhood. We're lucky in having great neighbors, and they are very interested in the great food we're producing on our .4 acre plot.
We live in a conventional house with three bedrooms and 2 1/2 bathrooms. Most of the living space (kitchen, dining room, living room, sunroom, garage) is shared space. Since my wife and I both work at home, we have an office that is not shared. We also provide most of the kitchenware (plates, utensils, pots, etc) to keep confusion about what belongs to whom to a minimum.
I can recall living like that as a student, six to eight renting a house, and sharing bills. And cooking meals for the whole house etc.
Have you read"He Died with a Felafel in his Hand"?
Jeez in half of half the developed world ppl already live like that. Or have for the past 30 years.
In poorer countries, it's like 15 people in a 3 room flat, etc.
???
From the link up top,
"Pemex seeks site for new refinery to cut gasoline imports"
Are they kidding?
With their depletion rate, how can they justify an investment like that?
What will they refine?
They've got plenty of oil. They just need to open up to investment.
That's their story, and they're sticking to it.
Honestly, I think the idea that there might not be enough oil to go around is just beyond most people's comprehension, at least for now. They're worried about high prices, not shortages. This refinery is probably meant to lower prices.
I had figured WT would have been all over that - surely they wouldn't just build a refinery and not use more of their own oil domestically. I think it portends, with the increase in the Mexican Peso vs the Dollar, more problems.
Maybe I am becoming a doomer after all. Transforming one sad realization after another, right here on TOD/DB. I still think that our own existing domestic production, supplemented to stay somewhat stable with new GOM production, will mitigate the impact(s), however. I'll just build a tornado shelter, not a bunker.
If you're looking for a pithy statement about the current psychological/political problem, that's about it. People think high prices is the problem, whereas it is just a symptom.
Venezuela has figured out a way to stop the production slide, just name a new production chief.
Petroleos de Venezuela to Name New Production Chief, People Say
The company that really needs a change of regime is Exxon. Bunch of slime. There will be quite a return on their lie and deny anti-science propaganda on global warming, but it won't be what they are expecting. The EIA number on Venezuela is not credible as has been demonstrated by simple summing up of their oil revenues for 2006. Since Chavez is supposed to be evil incarnate for not being a good little bootlick like the death squad juntas of the 60s and 70s he is "personally responsible" for the oil production drop in Venezuela. The figure 2.4 appeared on the scene after the 2003 strike where the oligarch crony union at PDVSA was trying to help "regime change". When the EIA starts reporting real decline rates based on geology and not imperial politics it will have some credibility.
We've seen this all before. Chavez continually reminds me of Huey Long, a tyrant who was still better than the racist aristocracy that he tried to destroy. Like Long, Chavez presides over a bunch of poor people and a lot of oil. Unlike Long, Chavez has sovereign power.
I recently saw a documentary about the Long family. I was suprised to discover that when Long was assassinated, power did not simply revert back to the oligarchs. His henchmen tried to protect parts of his legacy, and eventually his brother Russell became one of the civil rights pioneers in Southern politics. Time caught up with the essential rightness of Huey's vision while rejecting his methods. Except that under corporate rule and Reaganism, Louisiana has since reverted back to its past, from David Duke to Bobby "The Exorcist" Jindal. Even Katrina didn't speak as loudly as Huey Long once did.
So there's a hope that the idea of social justice will endure in Venezuela for at least a generation, perhaps when Chavez's personality cult has been replaced by the radical community organizers he encouraged. Unfortunately, long before then Venezuela will have to develop its tar sands. All the arguments against Canada's tar sands can be applied to Venezuela's, and what businessman would go through all that hassle in Caracas until he shoveled every last drop out of Calgary?
I think a huge swindle propagated on the fossil fuel science establishment has to do with the
reserve growth analysis promulgated by USGS geologists. In turns, the establishment has labeled the
reserve growth issue an "enigma" or a "puzzle".
The big technical issue that they have historically had with their analysis has to do with using "censored data". This essentially says that you have to be careful of extrapolating data backwards considering you have only a truncated data set.
Note that they use the term dispersion. I plotted the same data as a fractional yearly growth below, and the huge dispersion remains. Arguably you can see a 1/Time dependence in the curve. The red is a moving average and the green is 1/Time.
This dependence can be modeled by applying the dispersive discovery model on a region and then applying an autocorrelation to pairs of points along the discovery profile (basically a histogramming exercise). If the dispersive discovery has a 1/Time^2 dependence on incremental discoveries, then the autocorrelation has a 1/Time dependence. The blue curve superimposed shows this.
The swindle with all this has to do with when the original estimate is made. Conceivably you can make estimates that are very early in the lifespan of a reservoir, and you will get very low estimates for estimated discovery size. Now if that estimate grows at all, you can get huge apparent reserve growth factors. In contrast, you can wait a couple of years and then report the data. The later years' growth factor will be proportionately much less. Now if you consider that in other parts of the world, the reporting of reserves is not as conservative as in the USA, then the reserve growth factors can be all over the map.
The actual enigma I think has to do with the cluelessness of the USGS. You would think they would have figured this out long ago.
Very interesting. I think this should be an independent post, outside of the Drumbeat.
Middle East oil Consumption Shows Strong Growth
This looks like more ammunition for the ELM. And note, these are BP numbers, not IEA or EIA.
Ron Patterson
Right on Ron...If it isn't the fault of increased consumption in China then it must be the fault of increased consumption in the ME. Makes more sense than many of your posts.
To see graphs/charts visit site:
'Massive drop in US demand in April' #365
http://peakoildebunked.blogspot.com/
'On Monday (6/30), the EIA reported a gigantic drop in U.S. oil demand. And the figures are for April -- way back in the good ol' days when crude prices ranged between $110-$120.
EIA revises down U.S. April oil demand by 4.2 pct'
'So it strains credulity in the extreme to say Chinese demand is behind the run-up in prices since March. The drop in U.S. consumption in one year (April 2007 to April 2008) was more than twice the rise in Chinese consumption from 2006 to 2007 (325kbd, according to the BP Statistical Review 2008). In other words, the April drop in U.S. consumption wiped out one year's worth of growth from China (325kbpd), Saudi Arabia (149kbpd) and India (168kbpd) combined, and then some.
Furthermore, Chinese demand can't be fingered for price rises in April because Chinese imports were down year-on-year, as I noted earlier:
A decline in China's oil imports in April, the first year-on-year drop in 18 months, also raised questions over demand. China is the world's second-largest oil consumer after the United States. [...] China's April crude oil imports fell by 3.9 percent from a year ago to 3.47 million bpd, and were also down from the record of 4.07 million bpd in March, official Chinese data showed.Source
There's been no serious decline in supply. We're on the same old plateau, and in fact the IEA reports that supply was up considerably in the 1Q 2008'...snip...
There has been no reported serious decline in production.
Plus I've figured out whats behind the recent large price hikes and its not pretty. We have had a second phenomena occur thats of the same order of magnitude as export land but a lot more insidious.
Everyone for the most part recognizes something happened I'll repeat my challenge.
We did something in the 1980's thats come back to haunt us now and its not oil but it will result in the US being is serious trouble within I'd say four years at most.
What have we done to ourselves ?
Your seeing the fruits of our stupidity right now. And in my opinion we made a fatal error.
And the second hint its really a simple Econ 101 problem.
Why don't you just say what you mean?
Isn't the US in serious trouble now?
What point you are trying to make with this semi-reticence escapes me.
If you have something to say, for goodness sakes spit it out, or stop banging on about it already! :-)
Oooo....oooo... I know! We elected Reagan!
Memmel, I am not really fond of grade school guessing games. I agree with Undertow, why don't you just say what you mean?
And there has been a decrease in supply. Net oil exports are down about 1.3 million barrels from their 2006 peak and about 1.5 million barrels below their December 2005 peak.
Ron Patterson
You are of course referring to the effort by William Casey and the Reagan administration to engineeer an oversupply of oil on the market in an effort to cripple the USSR oil industry / economy.
I dont get the part where it is coming back to bite us today.
Francois.
we disconnected the dollar from oil somewhat like the disconnect from gold but more complex.
It's all about debt BABY!
And as river is pointing out its the economy stuped.
How did I do teach?
Well, yeah, it's all about debt.
I'd be happy to buy a contract to purchase oil for $150 per barrel 10 years from now simply because I don't expect the US dollar to be worth much in 2018.
I'm expecting the stock market and the housing market to perform so badly over the next 5 years that people will still be talking about it in 500 years - along with the South Sea Bubble and the Tulip Mania and 1929.
I don't expect this to be good for the dollar. Look at Argentina by way of illustration.
Comon Memmel tell us, or else ....
(sorry couldn't help myself ..)
I'm not sure what you are driving at. The connection may be obvious to you, and only you.
What "we did" in the 80s was to shift to a service, finance and debt based economy while the capacity to produce material goods was exported to Japan, Korea and later China.
Reagan abandoned any attempt to reign in spending, in fact the new matra was that we could borrow and spend our way to prosperity.
The result of easy money and easy debt policies was that the US (and the UK, and others) took on more and more debt over the course of the 80s and 90s, had several waves of asset based speculation, and now runs and enormous trade deficiet sustained only by the willingness of foreigners to lend us more money.
This game is now over. House prices and stock prices are likely to crash over the next 5 years until both yield returns in excess of 15%. This implies falls of 70% in asset values. Commercial credit rates are likely to go to 15% or more as lenders demand more compensation for risk. Unemployment will be desperately high.
I understand this - but I still don't get your point. Perhaps it is not as obvious as you think.
Not sure what you are driving at but a couple of things come to mind:
1) Declining EROEI - as we drill in deeper water, as we tap smaller fields, as each well yields less oil and more and more wells are required in declining fields, we will use more oil to produce oil. So even if supplies have not declined, we are burning more oil during the process of producing oil, so less is available for consumers.
2) Future production of drilling rigs in already committed years in advance, and it will take years just to build the factories to produce drill rigs at an increased rate. So as declines in offshore fields set in and an accelerating number of wells are required for infill drilling to reduce decline rates, we simply will not have the rigs available, or the capacity to produce extra rigs. We will struggle just to replace equipment nearing end of life.
So we will be effectively powerless to slow down decline rates once declines really set in. We won't have the rigs to do anything about it.
I can't really back this up, except to refer to Simmons. I suppose this is a consequence of under-investment during the 80s as we believed oil was super-abundant.
3) Discount rates. When interest rates are high - for example, 20% back in 1980 under Volker - investors will demand a risk-adjusted return on investment of at least 20%. This means that the value of all current income streams is marked down until you get a 20% return on investment. It means that the FUTURE is discounted at a rate of 20% - hardly any projects with a 5-10 year lead time are worth undertaking under those circumstances, because a risky project needs a COMPOUNDED risk-adjusted return of 20-30% to get off the ground.
If you announce that oil is in short supply, and prices are about to rise dramatically, this implies that growth in the world economy is about to stop or go into reverse. It implies that economies based on consumption and cheap energy such as the US and UK will see a drop in consumption, and reduced profits , and unemployment, etc. So it is negative for the stoock market and housing market. And it is negative for credit risk. And the for safe return of funds lent to the US goverment.
So once the end of cheap oil, and the fact of a declining supply, is publicly know, investors should demand a much higher return for lending funds - somewhere north of 15% - to compensate them for the risk of lending in an economy that is likely to be flat or declining in the long term.
Once a 15% return becomes the norm, all stocks, bnds, houses, projects etc must be discounted until returns match or exceed 15%. This implies a catastrophic revaluation of the stock market - down to DIVIDEND Yields of 15% and P/Es of about 7.
It also means that all future infrastructure projects must make sense even when funding costs are 15% or higher. And it means that the future is discounted at 15% or higher.
A project with a 5 year lead time, which then returns income for about 15 years before ending, must produce returns of better than 15% compounded over 20 years including the 5 year dead time.
So if the project costs $1 billion, it must return $16 billion by the time the well runs dry in 20 years just to break even. At least $20 billion to get funding.
So unless the value of the oil produced over the lifetime of the well is 20 times the initial cost of the project, it is never going to happen.
If interests rates go to 20%, the project must return 50 times the initial cost over 20 years in order to break even.
In other words, once you start discounting the future at 20%, there are , for all practical purposes, no long-term projects that make economic sense. None. Zero. Nada. We've already done everything with a 50 to 1 pay-off in the easy oil days.
So there will be no commercial funding for oil projects.
Why would rates go to 15-20%? Because investors realise that the party is over, they have to re-evaluate their understanding of risk and demand returns of that rate of loans because they are lending in a very dangerous economic environment.
Maybe memmel is insuating that the Saudi's saw what 20% interest rates did under Volker and figured that in a situation of permanent shortage those rates would be normal, which would kill the world economy. So they way out was to make oil abundant by opening the taps, and keep people from ever realising that shortgages would one day inevitably return.
Or maybe he was thinking of something else.
Anyway, if expensive oil tanks the US economy, and the stock market crashes down to P/E's of 7 as people realise growth is not coming back any time in the forseeable future, oil projects will have to make sense even with debt funding at 15% or 20%. Which means they won't make sense - deep water will be a loss-maker unless there is a 20-1 or even 50-1 payoff, thanks to the magic of compound interest.
Which means the western majors will be looking at 15% decline rates on offshore rigs, but won't be able to justify funding the projects to slow that decline.
In other words, the low interest rate environment of the last 20 years existed because investors believed growth could go on forever. The belief in growth led to low rates, which created growth. A self-fulfilling prophecy.
Once investors stop believing in growth, they will demand higher rates of return to compensate them for risk. Which means the future will be heavily discounted. Which means little or no funding for energy projects. Which kills growth stone dead. And worse than that, cuts off the funding for new projects which might slow the decline.
4) Localised demand destruction. Once America is seen as a basket case, the declining currency will force US (and UK) consumers to shoulder most of the burden of demand destruction.
The economies most dependant on the "finance economy" will see big falls in their economies and currencies when the "finance economy" model fails, this will make oil very expensive in local currency terms, causing demand destruction and accelerating economic decline.
TenThousandMileMargin---
Great analysis!
Here in a outlying suburb of Tokyo I've noticed JUST the phenomenon you describe!
Several real estate projects here CANCELED in mid-dig. Eyesores now. Gaping holes or half-finished buildings.
Rising materials costs drove the projects into the red before they could even open.. There was no way they would ever recoup their costs so they were abandoned.
Yesterday's Asahi Shimbum had a headline "Nationwide (Japan) 15% of started construction projects are cancelled due to rising costs"
For the past three years there has been building of condos like there was no tomorrow. Now indeed there is no tomorrow, at least for the projects in the pipelines now.
And, not coincidentally another headline is about the Nikkei avg, down 12 days in a row, a record not surpassed since 1953. Monday, if it goes down again will be unlucky 13.
Narita airport is, according to other reports, strangely QUIET this summer with bookings to N America and Hawaii down 40%. Airport traffic is generally down 10-15% perhaps, since people fly to closer destinations instead. Perhaps the Chiba Prefecture sweet potato farmers who had their land appropriated for the runways years ago will get their land back in another few years. I am hoping they will get their land back! I like a good roasted sweet potato!
just an anectote to the quiet Narita airport info.
Hiroshoma Airport got "a little bit" more busy this weekend, as a regular tourist-flight (747) commenced form here to Bergen/Norway ...."to see the fjords". I reckon that "regular" charter rout will last this summerseason only ... due to ....
I think Memmel may have also been referencing WebHubbleTelescope's idea of Overshoot - peak may be delayed for 7-8 years after the light sweet crude peaks through a flat out effort to extract everything possible, which shows up as a plateau, but this ends in production going off a cliff when it does decline as the most recent projects have very high extraction/decline rates.
I think Memmel has also suggested that some of the oil that has come online in the last few years is very sour and takes a lot of energy to refine, so industrial demand for oil goes up as your feedstock becomes more sour - which is similar to an exportland effect.
But the main problem, as Memmel has previously pointed out, is that once your growth-dependant financial system hits the wall, and risk adverse investors start demanding high rates of return, it simply doesn't make economic sense to extract hard-to-get oil.
"Hard oil" can never give you the 50-1 returns that are necessary to make a long lead time project viable in an enviroment where interest rates are 15% to 20%. Any oil company run to make a profit will not make such an investment - they'll just pay cash out as dividends instead. They'll have to, to support their stock price.
Thus you have a situation where oil supplies are falling dramatically , but you still can't justify new projects on economic grounds. The worse things get, economically, the more risk-adverse investors get, so only projects with exceptional prospects will get funding (at 20% interest).
But there won't be any projects like that. We've already implemented them.
TenThousandMileMargin - this analysis is simply put : fantastic. Thanks. There are after all quite a few TOD contributors with in-depth-knowledge: You are definitely one of them.
Receding Horizons explained in a nut-shell.
I’m having a flash-back to Bakhtiari’s claims were mega-projects started before the SHTF will have to be abandoned due to ramifications similar to what you here explain. Obviously the world is in Stage ONE as predicted by Bakhtiari. PI's reply just up here indicates Japanese Receding Horizons ...
Any analysis based entirely on production numbers is faulty. The anlysis must take net energy into account. EROEI is declining. Net exports are declining. The amount of energy available on the world oil markets is declining. That really isn't that hard to understand. Plateaus don't cut it.
River, I am sorry but your posts are really quite silly. My post, above, was a simple observation, no attempt was made to place "blame" on anyone. No one is to blame.
I am not surprised that demand is down in China. When the price gets high enough, fewer people can afford to buy oil or oil products. All this is covered in Economics 101. You need to study it River.
If oil is priced too high, this would lead to enough demand destruction until there is a glut of oil. this has not happened. Inventory numbers are dropping, both in the US and OECD. (There are no way to guage non-OECD inventories because most countries take no inventory.) But US inventories are 54,200,000 barrels below the same week last year. And OECD stocks saw a huge draw in April in contrast to their usual huge build in April.
IEA Oil Market Report
Demand is down because prices are up. Prices are up because supply is down. Again, economics 101. We don't have reliable numbers for supply past March yet. The EIA April numbers should be out next week. All production figures are just a guess but they do get more accurate the further back you go. The IEA has just made a huge downward revision in first quarter production numbers.
But not to worry River, if speculators are indeed causing this huge price run up, then a glut will be the result, driving prices way lower. That should burn thos damn speculators....right?
Ron Patterson
Actually, the speculators are net short now. It just got harder to blame them for high prices (it was always really hard, of course).
Right! I heart that they were. Most speculators are betting that prices will fall and if they don't, the speculators will get burned. On average, speculators are right about 50% of the time, exactly what one would expect.
I simply cannot understand why so many people who believe in the law of supply and demand believe that the law has been repealed when it comes to crude oil. The price will always rise if supply does not meet demand. The price will rise until it destroys enough demand that supply and demand are equal.
If prices are sky high then it makes perfect sense that demand will be dropping all over the world. Why can't people like River understand that simple economic fact? It is just down in the dirt dumb to say there is no supply problem problem when prices are going through the roof. And it is equally dumb not to expect demand to drop if prices over five times what they were just a few years ago.
Ron Patterson
Because that is not their core belief. Their core belief is that the "free market" is a supernatural force which creates goodness and eliminate badness. High prices -- BAD -- thus there must be some ideological impurity at fault. Once that sinful impurity is driven out, commodities of all kinds will return to their natural course of becoming ever cheaper and more abundant. Everything else is just spinning evidence to fit the conclusion.
it is. why such contempt for something that's given you everything you have?
Why such religious worship of something that has given us the ruined planet we must deal with?
As if there is a free market, anyway.
"Why such religious worship of something that has given us the ruined planet we must deal with?"
personally I don't worship the market like some do but to me the market is like gravity. it just is. the market hasn't ruined the planet and anyways the market can help fix the planet.
Which market is that, john15? Global corporatism? Competing lemonade stands on Main St., USA? You don't think that laissez faire free market globalism has trashed the planet?
You think the market is going to help "fix the planet"?
You are breathtakingly naive and simple about the state of the world. You clearly have total faith in the so-called "free market". You equally clearly have no idea what you're talking about.
Or else he has some idea about other's buttons.
The technical term is "troll", as I have pointed out previously :-)
global corporatism blah blah blah. your computer was probably made in china.
we have polluted the planet, but we've also made tremendous strides in cleaning up. countries like china as of right now have limited resources to control pollution but soon it will be big business. china is more worried right now feeding the people than about pollution. it's unfortunate but they were desperately poor and many still are. it's unfortunate, but that just seems to be the cycle and the US went through that.
well please prove it. what is your alternate explanation for markets and supply and demand? show me I don't know what I"m talking about. tell me what I don't know.
This post is proof enough.
No more feeding the troll.
I believe the technical term is re ipsa loquitur - the thing speaks for itself.
Everything sounds cool in Latin.
give me the alternate explanation for how the economy works other than Austrian Economics. nothing explains what is going on right now better than the Austrian School.
federal reserve
effects of fiat money
ethanol boondoggle
housing bubble
inflation
"your computer was probably made in china."
sgage, where was your computer made?
Upon being unable to marry the married man she loved (a practicing Catholic who shunned divorce), a man whom she met on regular but infrequent occasions, apparently for sex but they couldn't mention that on screen back then (so much for dogma, eh, if true), Bette Davis, in "Dark Victory," a film from a previous era, at the end quipped, "Don't let's ask for the moon. We have the stars."
Well, they really had neither if truth be known, but that didn't matter because it was an ersatz happy ending. Perhaps the alternative life worked out better for all concerned within the constraints of culture of their day, but I imagine they were fooling themselves. People do that, you know.
I think it was a rationalization to put the best face on a rather grim situation that was the true reality of the scale of their problem. When I hear "Walmart is going green!" I think we are pretending to have the stars, when we don't even have the moon.
Seeing it as face value and being happy for them was easy at the end. Delving deeper and considering evidence that it was a shallow happiness was not. I suggest you go rent the movie (or else Netflix it or however you rent movies nowadays). It will give you something to do for a couple of hours. A diversion from diversions. There might be a pop quiz later.
what's wrong with wal-mart going green? that's probably the best thing for green considering the effect it'll have on wal-mart's suppliers and competitors. it is possible for wal-mart to go green.
Yes, yes, of course it is possible for them to cease operations, but I doubt seriously if that's in the business model. And I'm afraid local substitutes would be hard pressed to spring up quickly enough to fill the void of destruction they've wreaked across the economic landscape. Such a labyrinth of short term self-deceit we weave, isn't it?
Anyway, I'm glad you're thinking about what being "green" does and doesn't mean. It's got to be awfully daunting being so cheery these days in the face of evidence to the contrary.
If you get too down, just sing along: http://au.youtube.com/watch?v=PufkuY-jEg4&feature=related
you're just guessing though. wal-mart says it'll spend $400,000,000 on more local food. wal-mart hasn't wreaked any economic landscape. that's just wrong. we've been getting goods from different places for hundreds of years whether the catalyst was cheap oil, canals or railroads. its' called creative destruction and it works. we tend to focus more on the winners than the losers though when it comes to creative destruction.
Creative destruction is a new one for me. Have a movie. I think I get the concept!: http://www.youtube.com/watch?v=tAVYYe87b9w
The market doesn't do anything. We can, however, use market mechanisms to encourage goods and discourage bads. This, however, requires intervention in the market. Just because the market can be a useful tool to accomplish certain things doesn't mean we just lie back and wait for magic to occur. The magic of the market will not change the basic reality that peak oil is here or will be here shortly. We can wait for mass suffering to occur by relying on the market absent any sort of intervention. Or we can give people incentives and disincentives now to minimize their need for oil through mass conservation, restructuring of cities, and alternatives. Waiting for the market to do all that will mean that most of us will have gone over the cliff in the mean time.
Just relying on the market by allowing mass overconsumption has caused us to overshoot the ability of the planet to provide sufficient natural services for us to continue much longer given the current population and consumption patterns. Relying on the market will only reverse this in the sense that mass dieoff will bring the ratio of needs to nature's available services into equilibrium.
"The market doesn't do anything."
I strongly disagree. the market does just about everything.
Yes, the market has trashed the planet.
we're making good strides in cleaning it up.
The contempt is for the dogmatic religiouslike quality of the belief. All things that we believe in need to continually tested and retested in the light of new data as it comes in. Rigidities of thinking lead to serious blindspots. The reality appears to be the the world in just starting into a transition between eras. The old era of exponential growth of resource consumption is slamming to its inevitable end. We are beginning a new neo-Malthusian era of the world economy. We need to develope the technologies, and mindset for the new era. A lot of old thinking is inhibiting this process. The way to minimize the pain of transition is to not fight against it, but to recognize it, and embrace and adopt the paradigm shift needed for the new era. This doesn't mean that markets won't be a major part of the new paradigms of the neo-Malthusian world. But if we make reliance of markets the only response we will be in for some nasty times.
Clearly the fact that none of the accepted official predictors of future energy/commodity prices predicted the current state of affairs should be prima-facia evidence that the current paradigm is seriously flawed. Literally trillions of bad investment decisions have been made as a result of using these faulty forecasts for industrial planning. Think of all the SUVs which may never be driven until they wear out. Similarly for jet airliners. Factories for the same products. Airport runway expansions... Billions spent designing future products that still haven't reached the market, and that will probably be cancelled and never come to market. So much scarce capital being wasted on futile attempts to continue BAU. We can't afford this waste. How far we fall before reaching the bottom of the transition will be determined by how smart and timely our response is.
note that it's your opinion that we are in a neo-Malthusian world. that is, for now, your opinion. how can you be sure that the same stresses that prompted limits to growth thinking in the 70s isn't the same thinking we're having today. maybe it's not a neo-Malthusian situation but a consequence of under investment in food, energy and other commodities for the last two decades? time will tell.
then you risk a boondoogle like ethanol subsidies.
capital is always scarce.
the continuing BAU thing is getting to be yet another TOD straw man. BAU is nothing. BAU is constantly changing. I don't even know what the TOD definition of BAU is. whatever is sustainable is what BAU will be.
is this BAU?
Wal-Mart Now US' Largest Buyer Of Locally Grown Produce
http://www.treehugger.com/files/2008/07/walmart-largest-buyer-locally-gr...
note that this is exactly what people like kunstler should be rooting for but they're so blind that they just want wal-mart to go away. if wal-mart has such low prices maybe are doing something right. how can we assume that local is always the best use of resources?
I don't discriminate. I'm an equal-opportunity contempt-orator. I have contempt for belief in any supernatural force.
If a Zeusist were to try to convince me that all we needed to do to solve overpopulation/resource depletion/environmental degradation was to sacrifice the correct livestock at the correct festivals and let Zeus' "invisible hand" handle the rest, I would be contemptuous as well.
So much of this site seems to be matters of faith of one form or another, I feel a song coming on...
(sounds best when consuming non-trivial amounts of overproof biofuel)
Give me That Old Time religion
Oh gimme that Ol' time religion,
Gimme that Ol' Time religion,
Gimme that Ol' Time religion,
It's good enough for me.
Let us worship Dionysus
Perun, Shiva, Frey, and Isis
(We'll forgive their little vices)
They're good enough for me!
Let us worship like the Druids
Running naked thru the wo-ods
Drinking vital body fluids
It's good enough for me!
O they say their God is comin'
Yes they say their God is comin'
Our God came six times this evenin'
And that's good enough for me!
Then there is the Horned One,
Of all the Gods, he's most fun,
He likes to hunt in woods and run,
And that's good enough for me.
It was good enough for Isis
She will help us in a crisis
And she's never raised her prices,
So she's good enough for me!
When you worship Jesus
Don't you DARE to try and Please us
'Cause in hell his dad will freeze us
And thats no place for me and thee
Here is one thing I do know,
Jove's favorite is Juno;
Cause She's awfully good at you-know;
And that's good enough for me.
We will read the Kama Sutra
The positions are quite 'outre'
But as long as you're not 'neutre'
Then that's good enough for me!
Let us all go worship Loki
He's the Nordic God of Chaos
Which is why this verse does not
rhyme or sync or scan or nuthin'
It was good enough for Odin
Though those omens were forbodin'
'Til at last the giants rode in,
And it's good enough for me!
It was good enough for Pan
He's half goat and he's half man
But he does the best he can
That's good enough for me
Let us worship Quetzalcoatl
A live sacrifice we'll throttle
And put his innards in a bottle
(Well, better you than me!)
Let us honor Ra Hoor Khuit
And his lovely mother Nuit.
If it's not your will, then screw it,
But it's good enough for me.
Let us worship like ol' Sappho
With her lady on her lap-o
She put Lesbos on the map-o
With her pagan poetry!
We'll be met by Aphrodite
She'll be out there in her nighty.
Though she's kinda wild and frighty
She's good enough for me.
Pete Seeger, if I'm not mistaken---
supernatural force=straw man alert. having contempt for "faith-based" economics is like having contempt for science. it's not supernatural it just is.
You are either the most naive person on the planet, or a very shameless troll.
The uncritical belief that "the market" (whatever the hell that is) will right all wrongs (that it created) is absurd in the extreme.
Judging by your handle, I suspect you are vulnerable to such scams.
I think our friend john15 is neither naive nor a troll.
I think he is a believer / free-market fundamentalist. As such, he has a great deal of company. This is a common affliction, particularly in the US, particularly among those who are influential in the public and private sectors.
"I think he is a believer / free-market fundamentalist."
To the extent that he is a true believer, he is naive.
Well, there is that...just not more so than a distressingly large portion of our fellow-persons.
Alas, yes.
so you got a better explanation or system?
you say that but you probably live in the same western style of living that the rest of us live in.
"you say that but you probably live in the same western style of living that the rest of us live in."
Well, as it happens, I don't live the in the same style that most people in this country (US) do. But that is neither here nor there.
The point is that we are in a really big mess, one brought on by the unbridled functioning of your holy "free market". Which is in no way free, anyway.
I said "unbridled". The market is good at what it's good at, but it's not the highest authority.
It needs to be bridled.
that scares me.
the market is the worst system, besides all the others.
The market is not a form of government. The market is reasonably good at allocating resources and optimizing production. This says nothing about equity, distribution of resources, and the negative externalities like pollution that are created if there is not intervention in the market to force the pricing of those externalities. Many saw our current situation of high oil and gas prices coming for years and warned that we needed to intervene in the market by, for example, increasing CAFE standards or imposing gas taxes. Instead, we decided to rely on the market. Ford, GM, and Chrysler, having waited for the market to do its magic, are now on the verge of bankruptcy. Yes, the current market has been and will change behavior, but at a serious disruption to our economy. The market sends it signals, but unfortunately, after the barn has burned down and the horses have escaped.
While it is useful to rely on the forces of supply and demand, we should not be enslaved by the ideology that says that the market can do no wrong.
That is, indeed, a fundamental problem. The price signals are not generated for resource issues until the crisis is upon us. That limits the market's effectiveness to things which can be responded to in a very few years. We needed 20 years or more to prepare for this situation. We didn't get it.
Well, it's more fundamental even than that. Our Congresscritters and Presidents didn't do us much good on this point either; their real job is only to make sure that anything bad happens on somebody else's watch. Governments are very good at tyrannizing and bullying people (it's interesting how often the high school bully and cut-up winds up on some town board that has the job of telling people what they can and cannot do), but not so good at deciding for the long term. Then again, most crystal balls are pretty cloudy anyway, as life is much more about adaptation than about successfully laying out and executing rigid, inflexible long-term plans.
Which reminds me that, as we see around here, the engineering and scientific types who dominate the 'factual' side of oil and climate discussions often seem to have a very low tolerance for the dance of adaptation (or perhaps in some cases any dance or artistic activity at all) - they tend to demand Plans Guaranteed In Perpetuity, or at least until the sun goes out. Just look at how James Hansen has gone completely off the rhetorical deep end. Maybe that legalistic demand for Plans Guaranteed In Perpetuity is the epitome of Wishful Thinking. And also of arrogance, since it essentially assumes that we now know everything there is to know.
I do suppose it could be claimed that Jimmy Carter tried, but then again he just came off as a sort of wimpy ineffectual crybaby unwilling to do anything that could be conceived of as useful. Certainly forcing people to waste countless billions of hours waiting in queues by having incompetent Federal poobahs badly micromanage oil distribution was not useful, it was just a gargantuan waste of human resources.
Likewise, the futures market is now sending signals, but apparently that just brings all manner of conspiracy theorists out of the woodwork to tell us that once all those mean nasty oil execs, or speculators, or other bogeymen du jour are jailed, Earth will resume its proper orbit and the oil price will drop like a stone. With oil back at a proper and "fair" price, the frivolous and entirely unnecessary act of flying from New York to Los Angeles merely to listen in person to a mind-numbingly dull dinner speech at the latest and most fashionable convention, given by a supposedly important but nonetheless inaudibly mumbling poobah over a howling and buzzing loudspeaker, will once again cost nothing, as of course it must in a just and humane world.
OK, so it's just not clear to me how to "win" on the point of timely signals. The problem seems not to be not a lack of signals, though it might be too many conflicting signals. But what I do know is that "power tends to corrupt, and absolute power corrupts absolutely." So I see little reason to trust monopolies, and government is by definition the granddaddy of bullying, overbearing monopolies, and I figure that the world already has a vast surplus of that sort of thing and does not need more.
Prepeak oil has had a shortage/glut cycle for a very long time. The time lags for both demand destruction/creation, and for investment in production infrastruce are long enough that corrections for either condition tend to overshoot. The question for the next few years is "is there enough of a downward corection possible to ovecome the effects of depletion, and (nominal) demand growth?". Most who read TOD, think not. But perhaps that is not the case, although it is hard to imagine any future period of price relief being deep enough or long enough to have much of an effect.
Ron, I seldom make 'silly' posts. You, on the otherhand, often make 'silly' posts. In the past you have proclaimed that 'there is no conspiracies', 'there were no gas lines in 1979' (when I cornered you on that one you apoligized, reluctantly, and 'there is no racial bias against blacks in the south' (when I cornered you on that by pointing out the 'Jena 6' schoolyard incident in Louisiana you muttered a half-hearted apology. With such a record how could you accuse anyone of being 'silly'. If you live in a glass house don't throw stones!
We all make mistakes. I make them everyday and so does everone else, including you. My suggestion to you is that you 'unstick your head' as Taleb suggests in the Black Swan. What happens to all of us is that we hear an idea and seize on it, sometimes without propere evaluation and due consideration. Once an idea is in one's head it become nearly impossible to dislodge, even when compelling new evidence comes to light. Once a person adopts a thought or position they are extremely reluctant to evaluate new data and change their mind. It is relatively easy to see this effect in others but difficult for each of us to see it in ourselves. As the old saying goes 'If we could only see ourselves as others see us.'...But, we do not.
I have attempted to get posters on this board to consider what is going on in the oil futures market and have been met with a storm of criticisim, deragatory personal attacks, and numerous 'nitwit button negatives'. I don't care about any of that baloney. If I cause one person to question the rediculous run up in crude prices in such a short time span they will conclude that something other than lack of crude supply is at work. Anyone with any common sense, especially those that have seen many bubbles come and go, as I have, will know that there are other factors at work in the oil commodities markets.
I have no position in any futures markets and I have never have, never will. If I feel the need for that type of adrenelin rush the wife and I get on a flight, go to Vegas, and play black jack or craps for a few days...In my life I have learned a couple of things. Work hard, spend less than I make and save, invest wisely, and avoid fiat currencies as much as possible. I know that many that post on this board have ulterior motives for doing so. I do not hold that against them unless they begin stretching the truth to sell a product to the gullible. Many that venture onto this board know nothing of economics or the oil industry and are easily taken in by charlatans. It is to those the neophites that I wish to communicate. Do not be suckered by bs claims about the reasons that the oil has advanced so rapidly in price. Do not believe that the 'price of oil is going up indefinitely'. If you avoid stepping into the 'futures game', or any oil 'investments', the best thing that can happen to you is that you will miss an opportunity to make some money. The worst thing that can happen to you is that you will get your head handed to you on a platter. I will leave potential neophite investors with one more thought...If it sounds too good to be true, then it probably is.
Here's the breakdown of the 811,000 bpd drop in April consumption that the author of the peakoildebunked article didn't appear to investigate. In my opinion he should have, as 448,000 bpd of the demand drop was in the NGLs and Other Liquids categories. I'd liked to have seen some discussion on this, as surely some technical factors are at play.
Note that these numbers aren't strictly “oil demand” as stated by Reuters and in the peakoildebunked article, but “liquid fuels and petroleum product demand” - a subtle difference.
If I understand correctly, propane comes from that NGLs + LRGs fraction. From last Wednesday's inventory report, we learned that inventories of propane have been increasing relative to those of the other fractions. Can we thus conclude that demand for propane has been declining faster than for other liquid fractions?
less BBQ's?
what is the demand break down for propane?
I suppose you would have to compare it to seasonal norms. Propane is a domestic heating fuel (though I don't have any figures about whether that is its primary use). One would expect inventories to climb in the spring.
NO! Propane demand is highly seasonal. Current propane inventory is well below the five year average. Right now we have 39.8 days of supply. This week last year we had 45.2 days of supply. Average imports of propane are well below their average of last year.
This Week in Petroleum - Propane
Ron Patterson
It seems, you did not get the May data regarding China Crude imports?!
China crude imports leap 25 pct, fastest in 10 mths
Reuters, Wednesday, June 11 2008
BEIJING, June 11 (Reuters) - China's crude oil imports leapt by 25 percent in May to their second-highest ever, reversing a rare fall the month before as refiners restocked supplies and stepped up runs to keep fuel flowing ahead of the Olympics Games.
Fuel imports by the world's second-largest oil consumer also jumped last month, reflecting robust demand in one of the only big Asian countries where pump prices haven't risen this year.
May crude imports rose about 10 percent from April to 3.81 million barrels per day (16.2 million tonnes), a rate second only to March's 4.07 million bpd, data showed on Wednesday. The growth was the strongest in 10 months, and appeared in line Morgan Stanley's argument last week that stronger Asian demand was drawing Middle East crude exports away from the Altantic basin, which it said could drive U.S. crude futures to hit $150 barrel within the next month.
You can also check for clarification http://www.forbes.com/reuters/feeds/reuters/2008/06/11/2008-06-11T111436...
You are not up to date, my dear! My advice: Simply check the latest data and then only post a comment. You are 100% discredited. I don't believe you one single word anymore.
JD is allowed to spam the site with propaganda because....? Look at this excrement:
First, it's a non-sequitur. The post he responded to was about the ELM and the applicability of the information to that model.
Second, given #1, he's propagandizing, not discussing. One need not twist a conversation to suit one's ends unless spinning to some other desired end.
Third, why the pointless insult?
Fourth, linking to yourself? Using your own opinion to support your opinion?
Cheers
I hate to wade into other people's arguments, but using the initial data from the monthly IEA oil market reports for the first quarter of this year really wrecks your credibility. Lots of people used those reports as "proof" that world oil production ascended significantly from its 3-year bumpy plateau. But the EIA figures, which are more reliable, show that at least as far as March-April, we were still in the 85 million barrel/day production range. I still think we are going to fall off the bumpy plateau this year.
wal-mart may be the one who makes our agriculture sustainable!
Wal-Mart Now US' Largest Buyer Of Locally Grown Produce
http://www.treehugger.com/files/2008/07/walmart-largest-buyer-locally-gr...
when you get a wal-mart contract it's all about price. so you're going to have to squeeze out costs. what does that mean? use less oil! wal-mart also uses less oil because they won't be trucking food as many miles as they used to.
Over the past five years or so, I've noticed an increase in the amount of hydroponically-grown food in the stores - mostly tomatoes and lettuce. I think that the producers were catering to people who were will to pay a premium for fresher and better-tasting produce in the winter.
The trend started well before the recent rise in energy prices. Now, it wouldn't surprise me if local greenhouses are nearly cost competitive with imported tomatoes from Mexico.
There are always the issues of reduced sunlight and high heating costs during the winter. However, a while ago, I saw a report on an immigrant from Mongolia who was running a successful greenhouse in northern Manitoba. He had piled up earthen walls on all but the southern side of the greenhouse and he could grow crops year round with very minimal heat sources.
Anyway, we can certainly learn a lot from pre-industrial solutions to thriving in extreme climates.
Goodness. A summer rerun of a post not even two dozen messages earlier. I remember when the sitcom season lasted for more episodes before the reruns kicked in. That reminds me, my damned teevee is going to stop working in a few months.
Oh well.
Is that a bad thing? Since moving out to a very rural area I have not had either a cable or antenna hooked up to my TV set. The only thing I miss is Nova and Frontline or the occasional football game. I must confess to using Netflix; at my location there is a three day turnaround for movies - nice! If my set and my spare in the barn burn out I ‘m not sure if I’ll get another. I prefer reading anyway. Just about finished with “The Black Swan”. Next is some fun reading by Terry Pratchett.
I use television for two things: I fall asleep to it and risk insomnia.
I like to watch just a tad of the morning news until I get angry and leave it behind for the day. (Nova isn't as good as it once was, IMO.)
Used to watch some of the televangelists and laugh myself to sleep; nowadays the pickens are so slim late night on broadcast teevee, I don't know if it's worth a converter box, even if the government subsidy made it essentially free.
I had cable about 1985-1992 or so, then decided it was a scam (for my limited needs) so that's not in the stars... and, I, um, cut all the cables loose and snipped it off where it comes into the apartment (me bad) once upon a cleaning frenzy, though that was several mergers of local cable company ago, and I probably won't go to TV jail for it. At least not this week.
I gave away my last TV a couple of months ago, and haven't turned one on in years.
I just watched a Frontline about pensions by streaming over the net. I don't know if all shows are available or just some. I manage to watch things like the State of the Union streaming as well. Depends on how fast your connection is.
Iran Says Nuclear Policy Is Unchanged
.... Now what ? my stance is still : It's their ethical and moral right to do so, if they so choose. Israel/US just have to sit still - priod -
I've always felt that the US and Israel have no right to preemptively strike Iran. On the other hand, I feel they do have the right to inform Iran that if Iran strikes Israel first, that we will completely, utterly, totally remove Iran from history forever. In other words, if you play nice, I'll play nice but if you play mean, I'll play meaner. That's classic M.A.D. doctrine and hopefully if Iran's population also knows it, they won't let their government do stupid things. There's nothing wrong with reacting defensively. In fact, that's the morally correct way to handle this. That way Iran gets to prove that it is really a member of the international community. And if Iran fails that test, then an appropriate response is the surest way to make the next such nation reconsider such folly.
Before George Bush, the US didn't start wars and the US said we would never use nukes first. We need to get back to that position.
The USA is the only country that has attacked with nuclear weapons-there is no position to get back to.
GZ...'Before George Bush, the US didn't start wars...'
I can only assume that you have been in the land of Nod for your entire life.
Are you related to Darwinian? Sounds like the sort of comment he would make...
Try a little Smedly Butler...From 1933, no less...
'Smedley Butler on Interventionism
-- Excerpt from a speech delivered in 1933, by Major General Smedley Butler, USMC.
War is just a racket. A racket is best described, I believe, as something that is not what it seems to the majority of people. Only a small inside group knows what it is about. It is conducted for the benefit of the very few at the expense of the masses.
I believe in adequate defense at the coastline and nothing else. If a nation comes over here to fight, then we'll fight. The trouble with America is that when the dollar only earns 6 percent over here, then it gets restless and goes overseas to get 100 percent. Then the flag follows the dollar and the soldiers follow the flag.
I wouldn't go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket.'...snip...
http://www.fas.org/man/smedley.htm
I am on the very same page as you Grey Zone. Well said.
***OBSERVATON / EDIT : Interesting thing this rating concept. I simply agree to Gray Zone's reply, but I'm having more minus than him :-) as of 3:45 PM
I turned off the rating system. I recommend that more of you do likewise. All it takes is Firefox, Adblock, and Adblock Element Hider. Then just specify the appropriate rule and it will vanish the next time you refresh the page.
Hello TODers,
http://www.upi.com/Top_News/2008/07/05/Aid_workers_Famine_growing_in_Zim...
------------------------------
Aid workers: Famine growing in Zimbabwe
...Effie Ncube, who runs a small aid agency in the African country, alleged the government has only offered food supplies to members of the Zimbabwe African National Union and has left all others to slowly starve, The Times of London reported Saturday.
-----------------------------------------------
Imagine postPeak Democrats starving Republicans, or vice versa, depending upon the political makeup of where you live.
VERY easy to imagine in New Orleans.
Alan
Hello TODers,
I am not familiar with this area, but this strikes me as being real bad timing as we go postPeak:
http://www.chicagotribune.com/news/chi-ap-mi-railwayclosing,0,675079.story
-----------------------------------------
IONIA, Mich. - After more than a century of use, a railroad line between Ionia and Lowell is being shut down.
...Plans are in the works to convert the Ionia to Lowell section into a recreation trail.
------------------------------------------
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Well, at least maybe they'll be able to bicycle between the two towns down that trail. They could also keep the rail and do spider web riding or whatever you call it.
re "The rise of nationalism".Whatever it is called - nationalism,tribalism,localism,parochialism,this is a natural human response to the vicissitudes of life.It can be tempered by education and communication but never abolished,thankfully.
We have to protect our own local/regional/national units because it is certain that nobody outside them will.That doesn't mean that selfishness has to reign supreme either.
Globalism,carried to the extremes of the last few years,has never been desireable or viable.
Globalism has suited the purposes of the powerful and the wealthy but is contrary to the interests of the middle and working classes.With globalism we have been sold a pup.
thirra -
You bring up a good point and touch upon a fundamental principle of human nature: groups of people will naturally band together and self-organize into arrangements that they believe will offer them the most short-term protection. As with most things involving people, the more ambitious and ruthless take advantage of such situations and generally rise to the top, with abuse and corruption soon to follow.
When you get right down to it, modern urban street gangs are not much different than the tribes or clans during those ancient times when there were no strong central governments to maintain order. While the average Joe deeply resented paying tribute to what were essentially extortionist thugs, he did so semi-willingly to protect himself and his family. To a modern poorly educated immigrant urban dweller, the Law is but an abstraction, something for the rich people, but he knows that if he pays tribute to the local gang, warlord, or whatever, he might get some protection. That's the way things work at the lower levels of society.
That is essentially how the now-fabled Mafia came into being. In the Old World it started out as a sort of vigilante dispenser of justice and a source of 'people power', but once in the US it soon morphed into a corrupt organized crime syndicate. Ditto the situation in the former Yugoslavia and Afganistan, not to mention a good number of countries in Africa, a place whose development appears to rapidly be going into reverse.
So, if things in the US should eventually descend into outright economic and political chaos, it would not be too hard for me to envision a situation in which local 'bosses' become the de factco government, while all the while the official federal and state governments go on pretending that they are still relevant.
One sign of this taking place would be the black market economy. In some of the worst Third World countries the black market economy is said to exceed the supposed 'real' economy.
People will always find a way to make do, though it usually ain't pretty.
Hello TODers,
http://www.commodityonline.com/news/Food-crisis-leaves-50m-more-people-h...
------------------------------
Food crisis leaves 50 million more people hungry
....Cereal production by low-income food-deficit countries, excluding China and India, declined by 2.2 per cent in 2007, and may fall further in 2008 as poor farmers are unable to pay for adequate inputs at ever increasing prices, he warned.
------------------------------
We never solved the food problem when energy was cheap @ $10/barrel, what chance do we have when global depletion and ELM kicks in?
If 100 million globally are dead by the end of 2009, will Murkans still be riveted to Britney Spears, sports, and videogames?
Have you hugged your bag of NPK today?
hi bob
I sort of disagree. I believe the food-situation was contained worldwide in the 1990's when oil was at some $20. Global cereal-stocks have more than halved since Y2K (from 120 days , down to under 60 days) ...... and (probably) dropping more as time goes by. The Bio-stunts has to take a lot of the responsibility for this in recent years and I believe there is a broadening consensus for this.
Regarding your find on dropping cereal production in Chindia , THAT is a sad situation. I’ve read that 100.000 Indian farmers have committed suicide since Y2K or thereabout, for a variety of reasons. Often due to impossible debts to fertilizer agents in combination with failing harvests ….
India and China have, both, instituted "Export" controls. Export Controls, invariably, lead to high prices, and shortages - just the opposite of what the "regulators" envision when they come up with these ideas.
Quite frankly, my guess is "yes."
What will you burn this winter?
Another glance forward to the coming heating season, this time from neighbouring Nouveau-Brunswick: http://telegraphjournal.canadaeast.com/opinion/article/342424
For the metric challenged, $1.43 per litre = $5.41/gallon.
Cheers,
Paul
essentially electric in the coldest weather.
Not true with the availability of fossil fuel kits. But that does add complexity to the consideration.
Hi RBM,
That's an important point -- a dual fuel system (heat pump + propane/fuel oil/natural gas) would alleviate much of the stress placed on the utility system during periods of extremely cold weather. For those applications where an all-electric solution is preferred, a heat pump combined with electric thermal storage is a great way to go; not only would it shift these high demand requirements to off-peak hours (flatten the curve), it could also help boost air supply temperatures, thereby addressing the "cold blow" complaints sometimes associated with these heating systems.
Cheers,
Paul
I thought this would have been picked up by now. Looks like we are now getting reports of the pending demise of the outlying tourist regions such as Las Vegas and the Caribbean (see article above). According the The Independent UK (The American media conveniently avoid articles such as this), Las Vegas is seeing fewer and fewer visitors and it's beginning to suffer. Cities like Las Vegas are doomed to evaporate in the desert as peak oil grinds on year and year.
http://www.independent.co.uk/news/world/americas/down-and-out-in-las-veg...
I make no judgments...
http://www.thesmokinggun.com/archive/years/2008/0702081gas1.html
When she arrived at the gas station, did she say, "fill 'er up". Sorry, couldn't resist. Me bad.
How the MTV generation will cope in a low-energy future....
http://youtube.com/watch?v=mEmnpSHe8F4&watch_response
het beste !
Paul
Wow ! Never knew such things were made !
Fourth with Friends, Family and Fanatic Republicans
For some reason, I was the lone liberal. So I got an earful of Republican talking points:
* As for Peak Oil, no worry mate, we're the Saudi Arabia of coal. We'll simply switch to coal. Heck the Germans did it in WWII. CTL is well worked out. Carbon dioxide? Well first, AGW is a hoax. But be that as it may, we'll simply sequester the stuff.
* Now about this Global Warming (AGW) stuff, not only is it pure hooey but most respectable scientists have serious reservations about it. Sunspots are responsible for what we've been seeing and lately we're seeing cooling because the sunspots have disappeared. The only reason Arctic sea is melting this year is due to underwater volcanic activity.
* If Obama gets elected then it's TEOTWAWKI because the Iranians will take over. They'll shut down the Straights of Hormuz and bring USA to its knees. We need to show them whose the boss by bombing them to the stone age now. Only McCain is man enough to do what must be done. Supreme Court? There's nothing wrong with Roberts and Alioto. So what if Roe v Wade is overturned? The market will provide for them who can afford it. Habeous corpus? It's always taken away in time of war. Nothing new or alarming there.
* After a couple of more beers, they (we) switched to talking about why Hillary must be a lesbian and Bill had to seek action elsewhere. Good clean fun was had by one and all.
_____
Hey don't shoot me. I'm just your lone liberal reporting from the front lines. Happy Fourth of July to all my fellow Americans, be you liberal, raging bull republican or agnostic. Peace and bombs bursting in air ore our land of the free and the home of the dispossessed Injuns (oops, I meant braves). The fireworks were awesome as always.