 | Countdown to $200 oil (12) - betting on Yergin | The Oil Drum | Obama's Energy Policy: Listening When We Disagree |  |
DrumBeat: November 12, 2008
Posted by Leanan on November 12, 2008 - 9:33am
International Energy Agency report on oil gets angry Opec reaction
Opec has made a scathing attack on a report from the International Energy Agency which says that the world's existing oil producers face a “huge challenge” to keep up with a projected rise in global demand....Abdullah al-Badri, Opec's secretary-general, gave a withering verdict on the study. “I don't trust this report,” he said. “I don't think the IEA is equipped to review these oilfields...I don't see how it will be useful.”
He said that Opec, the cartel of 13 oil-exporting countries that produces 40 per cent of the world's oil, had not been involved in drafting the study, which he dismissed as alarmist. “We have the reserves, we have enough oil for the foreseeable future,” Mr al-Badri insisted.
Oil Falls to 21-Month Low on Forecasts of Lower Global Demand
(Bloomberg) -- Crude oil fell to a 21-month low on speculation that the International Energy Agency will cut its global demand estimate tomorrow and the U.S. will report that stockpiles gained.The IEA is ``more than likely'' to lower its oil-demand forecast for next year in its next monthly oil report, according to Executive Director Nobuo Tanaka. The U.S. Energy Department cut its oil-demand and price forecasts today. A department report tomorrow may show that crude-oil supplies rose last week.
``It's hard to see what will stop this slide,'' said Tom Bentz, senior energy analyst at BNP Paribas in New York. ``It's more of the same. The market is moving on continuing economic concerns.''
Crude oil for December delivery fell $3.17, or 5.3 percent, to $56.16 a barrel at 2:46 p.m. on the New York Mercantile Exchange, the lowest settlement since Jan. 29, 2007. Prices have tumbled 62 percent since reaching a record $147.27 on July 11.
Credit crunch risks world oil supply
The warning came as Brent crude slipped $2.50 to below $53.21, a 20-month low.The report – the World Energy Outlook 2008 – said warned that there was a real prospect of global demand growth outstripping supply as the credit crisis hit investment.
A peak oil warning from the IEA
What does it mean when a usually conservative International Energy Agency (IEA) issues a gloomy report?It means that recent cheap oil isn't going to last - and that $100 oil will soon be a part of our daily lives ... again.
Slump's varied effects present mixed opportunities
HOUSTON -- The varying effects of economic troubles on exporting countries and national oil companies present a mixed slate of opportunities to international oil companies with cash to invest.Lew Watts, chief executive officer of PFC Energy, told the RMI Oilfield Breakfast Forum in Houston Nov. 12 that most Persian Gulf members of the Organization of Petroleum Exporting Countries can weather the slump in the price of crude oil.
Pickens Tells CNBC Oil Near Bottom, Forecasts Another OPEC Cut
(Bloomberg) -- Billionaire hedge-fund manager Boone Pickens told CNBC today that oil prices are near a bottom and will be back above $100 a barrel within a year.``We're in a global recession now, and you've got to be close to the bottom because OPEC is going to cut supply and support the price,'' he said in an interview. ``Within a year from now, we'll be back above $100 a barrel.''
(Fortune Magazine) -- As soaring oil prices enriched the Persian Gulf region in recent years, the United Arab Emirate of Dubai became the embodiment of global exuberance. Now even this boomtown has fallen prey to the credit crisis.
Chavez Says Sustained Drop in Oil Prices Will Affect Venezuela
(Bloomberg) -- Venezuelan President Hugo Chavez said his country isn't immune to a global recession and will be affected by falling oil prices should they remain low for a prolonged period of time.Chavez said Washington was to blame for the world economic slump that has contributed to a decline in crude prices. The country will confront the situation by strengthening its international reserves, he said in comments on state television.
Government lowers 2009 gasoline price forecast to $2.37 a gallon
WASHINGTON — Prices at the gasoline pump will average $2.37 a gallon for regular next year, the U.S. Energy Information Administration predicted today.But the slowing economy and volatile energy markets are making price forecasting a tough assignment. Just a month ago, the agency predicted regular would average $3.56 a gallon next year.
Chevron chief calls on Obama to create energy policy
NEW YORK (Reuters) - The head of oil giant Chevron Corp on Wednesday called on President-elect Barack Obama to create a national energy policy that promotes efficiency, opens up new areas for oil production and sets a clear policy on carbon dioxide emissions."The new administration has an opportunity to make realistic changes to our approach to energy and to create a comprehensive energy policy," David O'Reilly, chairman and chief executive of Chevron, said in a speech to the Council on Foreign Relations.
Does Natural Gas Have an Ally in Rahm Emanuel?
New hope for natural gas fuel interests may be on the way: When President-elect Barack Obama chose Representative Rahm Emanuel of Illinois to be his chief of staff, he chose one of Congress’s biggest proponents of compressed natural gas cars.
Norway plans more gas exports to Europe
BRUSSELS (Reuters) - Norway plans to increase exports of natural gas to Europe, which is trying to wean itself off its dependence on Russian energy, Prime Minister Jens Stoltenberg said on Wednesday.His pledge came as Russia threatened to scrap a pipeline to Germany if European squabbling continued to delay the controversial project.
Gas well burns out of control in northeastern B.C.
A ConocoPhillips Canada gas well is burning out of control in a remote area of northeastern B.C. near Chetwynd, the company says.The company said in a news release that it doesn't know how long it will take to get control of the fire, which broke out early Tuesday morning.
The flames are visible from Highway 97. A rig crew has been removed from the site, but no injuries have been reported.
Obama to Act Quickly on Global Warming in 2009
(Bloomberg) -- President-elect Barack Obama will act quickly on a campaign promise to address climate change upon taking office in January, his environment adviser said.Obama will borrow from initiatives in place in Europe and some U.S. states to control heat-trapping emissions, Jason Grumet said today in Washington. While he avoided talk of new policies today, the adviser last month said Obama may continue international climate negotiations endorsed by his predecessor, George W. Bush, former U.K. Prime Minister Tony Blair and others.
Pickens' wind plan hits a snag
NEW YORK (CNNMoney.com) -- Billionaire oilman T. Boone Pickens is scaling back his massive Texas wind project, citing a drop in natural gas prices and the tightening credit market."The capital markets are problematic for everyone and...may lead us to scale back a bit," Jay Rosser, spokesman for Pickens' company Mesa Power, said in a statement.
On Tuesday, Pickens, who has spend millions promoting his "Pickens Plan" to wean the United States off foreign oil by switching to wind and natural gas, told a utility trade group falling natural gas prices were responsible for the changes, according to a report in The Arizona Republic.
UK steps up wooing of oil-rich Gulf states
LONDON (AP) -- Britain stepped up its attempts to woo oil-rich Gulf states on Wednesday, with Business Secretary Peter Mandelson urging leaders in the region to bring investment here as a delegation of Saudi businessmen toured key British finance centers.
Russia looks to reserves for budget cash, stocks fall
MOSCOW (Reuters) - Russia's financial crisis will last at least another year and the government will have to dip into reserves to plug gaps in next year's budget if oil prices remain low, Finance Minister Alexei Kudrin said on Wednesday. His comments came as stock markets slumped, and dealers estimated the central bank had spent $2-3 billion to support the rouble around the 30.70 mark versus a euro-dollar basket -- seen as the central bank's new support level.There were also signs that some banks were delaying withdrawals and state bank VEB said companies and banks had asked for 50 percent more in aid on foreign debt refinancing than allocated for the purpose.
I'm participating in a webcast with some of my Standard & Poor's colleagues later this week. As I was preparing slides for it, I wanted to highlight some of the large-scale capital projects that have been delayed because of the combination of lower prices, weaker refining margins and the credit crunch.I figured I had enough for the slide when I got to five. To find five, I had to go back all of...one week.
Putin says Russia may scrap Nord Stream pipeline
MOSCOW (Reuters) - Russia may scrap its Baltic Sea gas pipeline project, Nord Stream, and build gas liquefaction plants instead if Europe keeps delaying the pipeline, Russian Prime Minister Vladimir Putin said on Wednesday."Europe must decide whether it needs this pipeline or not," Putin told Finland's Prime Minister, Matti Vanhanen, at a meeting in Moscow.
"If you don't we will build liquefaction plants and send gas to world markets, including to European markets. But it will be simply more expensive for you. You are free to make the calculations yourself," he added.
No Bailout Needed for Oil and Gas
Finally. Thanks to the recent trillion-dollar bailout of Wall Street, the public has found a group of corporations they hate worse than the oil industry. You can say a lot bad things about Big Oil, but you can’t say it needs a bailout. Surely, the American people will now begin to express their gratitude in a spontaneous outpouring of cards and letters to the nation’s oilmen. Allow me to provide a template, just in case spontaneity is lacking.
Petrobras Falls After Credit Suisse Cut, Oil Decline
(Bloomberg) -- Petroleo Brasileiro SA fell the most in two weeks in Sao Paulo trading after Credit Suisse Group cut the Brazilian state-controlled oil company's stock to ``neutral'' and oil prices tumbled to a 20-month low.``We are becoming increasingly concerned with the company's deteriorating cost structure and earnings outlook'' with oil prices at $60 a barrel, analyst Emerson Leite wrote in a note. He previously had an ``outperform'' rating on the shares.
US shipping fuel to North Korea
WASHINGTON: The United States says it has shipped 50,000 metric tons of heavy fuel oil to North Korea as part of a nuclear disarmament deal. The fuel is scheduled to arrive in the North in late November and early December.The announcement comes as North Korea complains about a delay in energy aid shipments. North Korea said Wednesday that it has slowed disabling its Yongbyon nuclear reactor in response.
Obama administration to ratchet up hunt for bin Laden
WASHINGTON (CNN) -- President-elect Barack Obama wants to renew the U.S. commitment to finding al Qaeda leader Osama bin Laden, according to his national security advisers.
IEA Says LNG Underinvestment May Lead to Shortages After 2012
(Bloomberg) -- Underinvestment in liquefied natural gas production plants may boost gas prices from 2012, the International Energy Agency said.``Shortfalls in the availability of LNG could push up prices and encourage the faster development of indigenous resources in importing regions,'' the IEA said in its World Energy Outlook 2008. Up to 2012 there will be a ``massive expansion in LNG supply.''
Greenhouse gases could rise 45 per cent, IEA say
The world is on course for a 45 per cent increase in greenhouse gas emissions by 2030, the International Energy Agency (IEA) has warned.This would lead to a temperature rise of 6ºC when scientists have warned that this must be kept below 2ºC to avoid catastrophic climate change.
OPEC mulls further cuts as oil falls to US$57
LONDON -- Oil fell almost 4% to nearly US$57 a barrel on Wednesday, its lowest for 20 months, on expectations of weaker energy demand and as global stock markets headed downwards.The fall in oil prices prompted OPEC officials to say they might decide to cut oil production further in an attempt to adjust the balance between oil output and demand.
U.S. crude for December delivery hit a low of US$57.04, down US$2.29 and its lowest point since March 20, 2007, before rallying to around US$57.59 by 1500 GMT.
Credit crisis adds to risk of oil supply crunch: IEA
LONDON (Reuters) - The credit crisis increases the risk the world's oil reserves will not be drilled fast enough to meet global demand growth, the International Energy Agency said on Wednesday.The agency's World Energy Outlook for 2008 stopped short of sounding the alarm oil supplies could have peaked.
But it highlighted obstacles to accessing new fields that include the increasing dominance of national oil companies as well as dwindling amounts of credit.
Running on empty, GM's fate is debated
As General Motors burns through cash, edging its way toward possible financial collapse, a growing number of analysts have said bankruptcy might be inevitable. GM insists such a move is out of the question, and as the debate roils, people on both sides point to two past scenarios for lessons.
Russia rejects U.S. missile proposals
MOSCOW (Reuters) - The Kremlin on Wednesday rejected U.S. proposals aimed at easing concerns over a missile defense system in Europe and said it would try again to resolve the row once Barack Obama is in the White House.Russia says the planned U.S. system will threaten its national security and that the administration of George W. Bush, which leaves office in January, has failed to allay its concerns.
Uganda: 4-axle truck ban causing fuel shortage, agents say
“Unlike the transporters of dry cargo, reducing the axles from four to three for fuel transporters has called for redesigning the sizes of the tankers, to fit the recommended three axles,” Mololo said.He said when the Kenyan government enforced the rule three weeks ago, his clients’ transporters went on a sit-down strike.
“The Kenyan government did not relent, saying the tonnage carried by the four-axle trucks ruined the roads.”
Hamas relying on underground supply lines, cut-rate fuel from Egypt
Although Hamas has reported a fuel shortage that was hampering its power facility, the military has determined that Hamas, despite increasing tension with the regime of Egyptian President Hosni Mubarak, was receiving most of its fuel requirements from Egypt's Sinai Peninsula.The sources said that in July 2008, Hamas constructed at least two pipes from Sinai for the transfer of diesel oil and natural gas to the Gaza Strip.
Three days of deadly blasts rattle Baghdad
BAGHDAD - A series of blasts struck Baghdad for the third consecutive day, killing nine people and wounding more than 30 others Wednesday, police said. The attacks underlined the fragility of recent security gains in the Iraqi capital.
Michael Pollan: Eating Is a Political Act
Michael Pollan has got people talking. His recent books, The Omnivore's Dilemma: A Natural History of Four Meals and In Defense of Food: An Eater's Manifesto, have captured the public imagination, setting off countless coffee shop discussions, dinnertime arguments, and oh-so-many blog posts.Even more impressively, his exploration of modern-day agriculture and the dysfunctional American diet has prompted his readers to look at their own eating habits with a new sense of understanding and often a desire for change.
California's car tax may be on the road again
The vehicle license fee that got Gray Davis recalled and Arnold Schwarzenegger elected looks like a good idea again.
Bolivia holds key to electric car future
High in the Andes, in a remote corner of Bolivia, lies more than half the world's reserves of a mineral that could radically reduce our reliance on dwindling fossil fuels.Lithium carries a great promise. It could help power the fuel efficient electric or petrol-electric hybrid vehicles of the future.
But, as is the case with fossil fuels, it is a limited resource.
Thieves make off with church furnace oil
St. Mary’s Roman Catholic Church in Newcastle is facing a sudden oil shortage On Nov. 8, they reported 1900 litres of oil was stolen from the church. The big red tank was located at the back of the building.
Ex-official says Mexico may have to halt oil exports
The U.S. could soon find itself scrambling to make up 11 percent in lost oil imports.Mexico, the third-largest foreign supplier of U.S. oil, faces the real possibility of having to halt oil exports in four years, a former top Mexican energy official was reported as saying Tuesday in Mexico’s El Universal newspaper.
Rogelio Gasca Neri, the former head of Mexico’s federal electricity commission, blamed the inability of the nation’s oil industry to produce enough oil to meet rising demand.
Neri’s comment, made in Mexico at a business forum on reforms in the nation’s energy industry, also joins that of a growing number of energy experts who see an end to Mexican oil exports coming soon.
Study Points to Major Source of Natural Gas in Alaska
Federal scientists have concluded that Alaska's North Slope holds one of the nation's largest deposits of recoverable natural gas in the form of gas hydrates, a finding that could open a major new front in domestic energy exploration.Researchers have speculated for years that gas hydrates -- a combination of gas and water locked in an icelike solid that forms under high pressure and low temperatures -- could provide an important source of natural gas in the United States and worldwide.
Today the U.S. Geological Survey will release a study estimating that 85.4 trillion cubic feet of natural gas can be extracted from Alaska's gas hydrates, an amount that could heat more than 100 million average homes for more than a decade.
Putin Denies Plan of OPEC-Style Gas Cartel
Prime Minister Vladimir Putin sought to ease fears Tuesday over the possibility of Russia joining an Opec-style cartel of gas exporting countries, he said in talks with his Egyptian counterpart Ahmed Nazif."We support this idea. But we know about apprehensions and even fears voiced by certain energy consumers," Putin was quoted by news agency Interfax as saying. "I wish to state once and for all: there are no grounds for such fears."
Australia: Handouts fuel a destructive course
THE federal Government's $6.2billion Car Industry Rescue Package is a lifeline to industry and our skilled workforce, but given that for years governments have tossed good money after bad into the automotive money pit, taxpayers will want results. Positive aspects include more than doubling the Green Car Fund, and the $3.4billion Automotive Transformation Scheme, which one can only hope will do just that in the next decade.The real problem we face - and in the US it's far worse, with car makers bleeding money - is that the car is unviable and has been for a long time. We have all known the need for change since the first oil shock of 1973, but almost nothing was done about it. We know oil is a finite resource - we may already have hit "Peak Oil" - just as we have long known that the petrol-driven car contributes to global warming. As such, it is a double-whammy evildoer: polluting the skies while guzzling a scarce resource, and that's not to mention its daily toll of death and mayhem.
Mass-Transit Projects Fared Well at Polls
U.S. voters approved billions of dollars for mass-transit projects, highlighting a growing desire to overhaul the nation's aging transportation systems.The increasing political support for transportation investment comes as Democratic leaders in Congress are pushing for a second economic-stimulus bill that could include tens of billions of dollars in additional spending on infrastructure projects. It also signals a potential boon for companies that provide everything from locomotives to collision-avoidance technology.
Saudi Arabia to Export More Oil to China
BEIJING (SinoCast via COMTEX) -- Abdallah S. Jum'ah, CEO and president for Saudi Arabian Oil Co. (Saudi Aramco) yesterday said in Beijing that the Saudi Arabian state-owned oil producer intended to export more petroleum to China, so as to further strengthen their energy cooperation.
World needs to tap oil reserves more quickly - IEA
LONDON (Reuters) - The world is not about to run out of oil, but there is a risk its reserves may not be exploited fast enough to meet global demand growth in the years ahead, the International Energy Agency said on Wednesday.The agency's World Energy Outlook for 2008 stopped short of sounding the alarm that oil supplies may have peaked, but highlighted obstacles to accessing new fields that include the increasing dominance of national oil companies.
"Some 30 million barrels per day of new capacity is needed by 2015," said the IEA, which advises industrialised countries.
"There remains a real risk that under-investment will cause an oil-supply crunch in that timeframe."
IEA Warns of Energy Supply Crunch
LONDON (AP) -- The International Energy Agency on Wednesday predicted world energy demand will rise 1.6% a year on average between 2006 and 2030 and called for massive investment in energy infrastructure to prevent a supply squeeze.The IEA's base scenario for energy demand has fallen because of the global economic slowdown and higher oil prices, but the agency stressed that a delay in spending on new projects because of the credit crisis could lead to a "supply crunch that could choke economic recovery."
The IEA expects demand for oil to rise to 106 million barrels a day in 2030, 10 million barrels a day less than projected last year, from 85 million barrels a day currently.
Oil supply-demand gap to widen sharply after 2010: IEA Outlook 2008 news
London: Dismissing fears of peak oil, the International Energy Agency has however warned that the world runs a risk of failing to match supply and demand. Releasing the full version of its World Energy Outlook for 2008 today, the IEA has highlighted obstacles to accessing new fields and increasing supply.
IEA doesn't see peak oil by 2030
LONDON (MarketWatch) -- The International Energy Agency on Wednesday dismissed fears about peak oil, but the group said under-investment could lead to production troubles...."Although global oil production is not expected to peak before 2030, conventional crude-oil production is projected to level off toward the end of the projection period," it said.
From credit crunch to energy crisis?
OTTAWA -- Global oil companies are sowing the seeds of a new supply crisis and a return to record-high prices by cutting back on current investments in response to the global slowdown, the International Energy Agency warns.Four months ago, economists warned of "demand destruction" as record prices and a slumping economy slowed the growth of global crude consumption. But now, the IEA is worried about "supply destruction" as producers delay expensive projects, including some in Canada's oil sands, that would bring much-needed supplies to market.
World Needs a Kuwait a Year to Meet Demand, IEA Says
(Bloomberg) -- The world must find an extra 64 million barrels a day of oil production by 2030, equivalent to replacing Kuwait's output every year, to meet demand growth and counter the decline of existing fields, the International Energy Agency said.
Costly oil, gas drive world to burn more coal - IEA
LONDON (Reuters) - Coal, already the world's second-most used fuel after oil, will grow more competitive after 2015 as oil and gas prices are expected to rise, the International Energy Agency said on Wednesday.Coal's share of global energy demand would rise to 29 percent in 2030 from 26 percent in 2006 -- driven by booming power generation growth mostly in China and India.
Sub-Saharan Africa energy exports on sharp rise - IEA
LONDON (Reuters) - Energy exports from sub-Saharan Africa will rise significantly as the region opts to maximise foreign currency earnings rather than attend to domestic fuel needs, the International Energy Agency said on Wednesday.Oil exports from the region would hit 6.4 million barrels per day (bpd) by 2030, out of the 7.4 million bpd expected to be produced, the IEA said in its latest World Energy Outlook.
Oil slips below $59 on global growth pessimism
VIENNA, Austria – Oil prices slipped below $59 a barrel Wednesday as investors grappled with the prospect that global growth next year will slow more than originally feared, cutting demand for gasoline and other crude products.Expectations that a snapshot of the U.S. inventories will also show reduced consumption of oil and derivatives also acted as a drag on the market.
Oil below $60 "overshooting" to the downside - IEA
LONDON (Reuters) - The price of oil, which sank below $58 a barrel on Wednesday, is "overshooting" to the downside, said the head of the International Energy Agency.
OPEC must consider if further cut needed - Nigeria
"I think we need to look at the market and see if there is need for cut, because we took out 1.5 million barrels per day but to no effect," Oil Minister Odein Ajumogobia told Reuters.
Russia-China oil loan talks suspended on differences
MOSCOW (Reuters) - Russia and China have suspended talks over $25 billion in loans to Russian oil companies due to disagreements over interest rates and state guarantees, two Russian sources close to talks told Reuters on Wednesday.
China boosts oil storage capacity
China will add 26.8 million cubic metres of storage capacity in the second phase of its strategic oil reserve build-out, the National Development and Reform Commission said today.It did not provide details about where the bases would be located or how much investment would be involved, wrote Reuters.
The world's second largest oil user will complete the construction of its first phase, including 16.2 million cubic metres of capacity, by the end of this year, but it has remained tight-lipped about when these bases would be filled.
China's economic stimulus plan targets its infrastructure
"China will be under a lot of pressure to come up with more money to rescue the global economy," says Frank Gong, a Hong Kong-based economist at J.P. Morgan, ahead of Saturday's summit of the G-20 group of countries."But this plan helps China stand by its position: To stabilize the Chinese economy is the best contribution China can make," he says.
Paul Krugman + Al Gore = The Way Forward
Nobel Laureates Paul Krugman (2008, Economics) and former Vice President Al Gore (co-recipient with the Intergovernmental Panel on Climate Change for the 2007 Peace Prize) contributed wonderful op-ed pieces in the New York Times which, taken together, provides a way forward out of the economic malaise along with solutions to America's energy problems and to the global climate crisis.
TEHRAN, Iran (AP) — Iran has successfully test-fired a new generation of its longer range surface-to-surface missile using solid fuel, making them more accurate than its predecessors, the defense minister announced Wednesday.
Obama's plan for Iraq about to meet reality
Some outside observers say that like other U.S. presidents who have taken office in wartime, Obama may have to improvise to a degree that neither he nor his advisers can fathom."Obama is going to find he has to chart a different course in Iraq than he campaigned on," says Reidar Visser, who runs the Iraq-focused website historiae.org.
As Exxon Valdez checks near, fishermen resigned to disappointment
After a nearly 20-year wait, thousands of commercial fishermen and other plaintiffs are on the brink of collecting punitive damages for the Exxon Valdez oil spill of 1989.The checks won't be anything like the blockbuster payments many hoped for after a federal jury awarded them $5 billion -- an amount the U.S. Supreme Court this summer cut by 90 percent.
Still, dozens of fishermen can expect checks for more than $100,000. And a few will range up to around $400,000.
Norway Statkraft buys UK wind farm developer
OSLO (Reuters) - Norway's state-owned utility Statkraft bought the 50 percent it did not own in a developer of a Wales wind farm expected to produce 65 gigawatt hours of electricity per year, it said on Wednesday.
The US nuclear waste issue – solved
Nashville, Tenn. – President-elect Barack Obama supports nuclear power to increase US energy independence and fight global warming – but only if a path to safe nuclear waste disposal is opened. Fortunately, there is a two-step plan that can open that path and lead to an effective waste solution within eight years. And it embraces citizen consent.
TOKYO (Reuters) - Japan's greenhouse gas emissions rose to a record high in the year to March, putting the world's fifth-largest carbon dioxide producer at risk of an embarrassing failure to achieve its Kyoto target over the next four years.The increase of 2.3 percent last year, largely due to the closure of Japan's biggest nuclear power plant after an earthquake, will ratchet up the pressure for it to give up its efforts to control emissions through voluntary measures and adopt tougher limits on industry like the European Union and Australia.
IEA stokes doubts over world's climate fight
LONDON (Reuters) – The world will have to bet on extreme measures to avoid serious global warming, the International Energy Agency said on Wednesday, adding to growing worries that governments have under-estimated the problem.The world will have to suck greenhouse gases out of the atmosphere because it was too late to rely on gradual curbs in heat-trapping greenhouse gas emissions, it said.
World leaders need an emergency backup plan to stave off catastrophic climate change if cuts in greenhouse gas emissions don't work, says climate scientist Ken Caldeira of the Carnegie Institution in Washington, D.C.
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.
China is in a depression-retail sales are only up 22% YOY http://www.bloomberg.com/apps/news?pid=20601068&sid=abM29KiepBow&refer=home
Don't worry, they've got a stimulus package in the works. I think it involves building storage tanks for oil, so they can stock up while it's cheap.
Better yet, just buy a bunch of oil barges. Much easier to fill up, move around, and let sit somewhere for storage. I'm sure that with the recession and lower demand for oil there are a few barges they could snap up real quick at fire sale prices...
Their government is trying to make an overnight jump from an export-driven economy to a retail-driven economy. So a collapse in export growth might accompany the boom in retail, and even more so next year with their stimulus package. Based on the shipping rates, Chinese goods are staying at home.
Re: The IEA Report
With the rather dire predictions in the IEA Report, the price of oil is still going down. Must be that old invisible hand of economics. Ever heard the sound of one hand clapping?? That invisible hand slapped the World in the face last summer as the price of oil neared $150 a bbl. The corpse of Reaganomics continued to sleep walk toward the cliff...
E. Swanson
The report isn't yet officially released, but there's a bunch of stuff at their web site:
http://www.iea.org/
Including a press release, fact sheets, and key graphs.
I've taken this morning since the press release, etc. was put out reversing the one useful graph to look at the assumptions.
This graph:
yields the following for the contribution from new fields not yet developed and new fields not even found yet.
Please excuse the noise, its not easy to pull those figures off the graph.
The immediate reaction is to compare and contrast these assumptions with the megaprojects data, particularly in the short to medium term. An extra 2-3Mbpd from totally new fields every year from 2010-2015 doesn't come anywhere near matching up. Not only that but from 2016 we are supposed to start seeing contributions from fields not even found yet, by 2020 a good 1Mbpd every year from totally new fields.
Sounds like someone has sprinkled the fairydust over this report
I removed the "width" tag, because for people with large screens, it blows the image up to unreadable size.
If the low price is causing hesitation in the short-term, like the first two links on IEA indicate, but we are OK out to 2030, although demand is outstrripping supply, why are we not all a little confused?
If we have the shortfall, and supply fails to meet demand for the next 12 - 18 months, supply would have to grow faster than projected to make up for that shortfall, spurred by the higher prices brought about by the shortage, but without extreme expansion of infrastructure (like way more rigs, etc) which will be worsened by the low prices in the short term, we can't possibly catch up.
All that, and I don't think a word of it is true. My opinion, like everyone slse's, does not matter though. The shortages are going to hurt the lower income folks in developed countries the worst. The population in sub-Saharan Africa will not be hurt as bad because they do not use fossil fuels at anywhere the rate, per capita, western populations do. Whether we have peaked or not, the demand has been here in the past and will be again in the future, and we will not have another Kuwait to add each and every year as another article linked to Bloomberg suggests.
Wow, that puts it in perspective. They'll be screaming there's no peak all the way down the long descent. Just the way every market commentator was calling for people to buy buy buy with this bear market downturn. As for those retail sales for China, in a few years they'll be well below where they are today.
Some other points that fall out of the graph:
Judging by the other comments they make, they still seem to rely on a magic middle east to develop new untapped fields and find more. That's despite the Saudi statement of leaving fields for future generations. I'd love to see their 800 field database justification for that - just where are these uptapped reserves they are so sure can be tapped in 5-10 years?
How much of this magical new production is supposed to come from Iraq? There are supposed to be gazillions of barrels of oil out there-- they just haven't been explored or developed. And by destroying the country, TPTB have effectively destroyed domestic demand, so "export land" models are not applicable there.
That's an interesting thought... Instead of acquiring oil supplies to ensure our energy future, destroy other countries, and implicitly their demand for oil. Imagine the oil demand in France if we nuked it. Repeat this for other countries, and viola! if world supply is only 20 mbpd, and your country demands 15 mbpd but is the only country that has a functioning economy and needs oil, then there's no problem with Peak Oil.
Hardly a new idea. Alexander of Macedon was a pioneering thinker along those lines.
Pakistan's next in line for infrastructure-destruction-enabled demand destruction.
Yep, and they might just be the first country in the world to nuke themselves. This'll be fun...
Pakistan is nearly bankrupt; see http://www.thenational.ae/article/20081111/FOREIGN/370875226/1002.
They have barely enough money to import food & fuel for another 2 or 3 weeks.
My guess is that US will bail them out again; otherwise we will not get "cooperation" from Pakistan in the war on terror.
You are putting the cart before the horse. When oil production stopped growing, the economy stopped growing. Oil prices skyrocketed and these two factors sent the economy into a deep recession. And it will get a lot deeper. TPTP had absolutely nothing to do with it, unless you think they somehow have control over world oil production. And it is the world economy that is being destroyed, not just this country's economy.
High world oil prices have destroyed world world demand and consequently caused world oil prices to fall. These low world oil prices will increase world consumption and cause prices to rise again. This in turn will cause .....
Folks must stop thinking "country" and start thinking "world". Whether you think globalization is a good thing or a bad thing, it still exists. We are all in this together.
Globalism is far from complete at the moment, which is one reason why no Chinese banks have failed. They are still under heavy Government control, as is the exchange rate.
That is not to say that there will be no effects on China, but a substantial degree of disconnectedness still survives, fortunately, and the effects of the Global recession may not be quite as universal and especially not as uniform as you imply.
China depends on global exports far more than most other countries. And they hold a huge chunk of the US debt. When the world stops buying Chinese exports China will be in deep doo doo. And China is almost totally dependent on imports for iron ore and most other raw materials. China has the the very epitome of "globalists economy".
China Iron Ore Imports to Stall Next Year, Group Says
A $586 billion bailout plan! Sure as hell looks a recession to me.
All banks in all different countries have different regulations and different levels of government control. Nothing concerning the global recession dictates that all banks in all countries must fail at the same rate.
China is toast, but you can bet that the Chinese army is going to strenghten.
I wouldn't want to be in their neighbourhood (especially in the Russia).
Unlike the US, China has been running a budget surplus, and so has the money available to counter a recession, and although it won't be easy can switch to producing infrastructure, hopefully with a healthy amount of that going to energy, railways and battery technology.
It's situation is more similar to the US in 1929 than to the US today, as it can deploy resources given the political will in a manner the US no longer can.
I was not attempting to argue that China or anywhere else will be unaffected, merely that the situation of various countries is diverse, and that will continue to be the case.
I hope they won't build too much infrastructure (or rather I hope oil prices will climb and stymie their plans)...why? Because here all kinds of infrastructure is turning into huge pieces of cement waste. There is even a huge train station one hour away from Tokyo--on a famous old train line that has been running into Tokyo for over 100 years--it is all shuttered as of this past July, you can still board a train there but you can't buy anything (the station shopping center is 7 stories high and two blocks long). I think this train line is getting ready to significantly cut service---I am sure passenger numbers are down. In Japan the built infrastructure is huge. They've been using stimulus schemes to finance all sorts of building projects ever since the bursting of the bubble, all to keep people employed.
And now it doesn't seem to be paying off at all. The economy is still tanking, even the railroads (some are way overbuilt I guess) are feeling the pinch.
But the government announced yesterday that everyone will get a sum to "stimulate" the economy--about $120 per person. So I am planning to buy some socks to keep warm!!
Chinese infrastructure is not anywhere near as developed as that of Japan, and hence has more possibility that further work will be useful.
It is not clear how the money will be split, but further investment in the wind, nuclear and residential solar thermal markets would be useful, as would continuing development of battery technology by companies like BYD.
Over here (U.S.), we have bridges collapsing, roads not being repaired, schools still using "temporary" outbuildings some 30+ years later, zero miles of high-speed rail, and no new nuclear power plants built in 20 years. The only new "infrastructure" we've been building here lately is empty McMansions no one except speculators wanted to buy --and all the speculators have left town.
We could really use an infrastructure WPA-style rebuilding program here. At the very least, it would be a FAR better use of the $2 Trillion+ that our Treasury has already blown on the Black Hole of Wall Street bailout programs (TARP, nationalization of Fannie/Freddie, AIG, Bear-Stearns), not to mention our war of choice, unworkable military boondoggles (Star Wars missile defense systems, next-gen ships/planes for a technologically advanced enemy (USSR) that no longer exists), etc. etc...
Having 'too much' infrastructure is quite a nice luxury. Please remind me, who "won" WWII again? ;-)
What line/station is this?
It is clear we (USA) are going to go for a large Keynesian stimulus as well. Of course that sets up a race condition, will we reach recovery before the debt reaches ruinous levels. I'm not optimistic about the outcome of that race, but we will soon be charging out of the starting blocks.
Prices will rise again, but will be constrained by the availability of US dollars (as long as oil is priced in dollars). We saw the Fed recently provide $30 billion dollars to each of four G20 nations via currency swaps. The demand for oil will be there, but it's hard to fathom where emerging market countries will get the money to pay for oil (unless the Fed keeps shipping hundreds of billions of dollars to them).
I'm wondering if we might see more bartering in the future. Like Thailand trading rice for oil.
I think you are right that we will be back to carts and horses.
TPTB created this financial system knowing full well it would "fail." I don't believe there is a "conspiracy." Just a lot of people thinking along the sames lines....
My sources are folks like Illargi and Naomi Klein -- they could be wrong, of course. I don't have any personal knowledge of any of this-- just experience, and a gut feeling that if something seems wrong, it probably is wrong.
But wait, I'm reading the sentence "And by destroying the country, TPTB have effectively destroyed domestic demand," in the above posts this way:
And by destroying the country (IRAQ), TPTB (us, the USA) have effectively destroyed (IRAQ's) domestic demand,
Given that, the poster's sentence made sense to me. Plenty of evidence of this in other places in history.
havent read the report, but doesnt it appear that they pull new discoveries out of ........um......uh...... somewhere to make up the difference between demand and supply.
Exactly right. As I said in my post over on the IEA report thread, this very much looks like it was simply made up out of thin air to fill the gap between projected supply and demand, rather than being built on any real data.
"Demand creates its own supply" - interesting concept. Too bad the real world doesn't actually work that way.
Looks like the report has to be purchased which I guess makes sense.
As a non profit TOD could get 30% off.
I'd be happy to buy the report for the TOD staff if that helps.
2-5 copy pdf looks to be $300USD if I have the currency conversion correct.
http://www.iea.org/w/bookshop/add.aspx?id=353
Pete (ptoemmes at bellsouth dot net)
Thanks, but we're covered. ;-)
I can't wait until oil is free.
And just when do you think governments and their taxes will cease to exist? (Great Big Grin)
From the perspective of the peak oil community, the IEA report is actually not dire at all.
The key is to focus on their projections for conventional oil production. They say roughly mid 70s million barrels per day in 2030. i.e. a slightly upward-slanting plateau.
The EIA in the US has released scenarios that are considerably less optimistic. Consider their high price case in their International Energy Outlook 2008. They don't break out conventional oil separately. But even including NGL's, they see the plateau sloping down. An early release in April projected conventional oil at only 60 mbpd in 2030.
As a general rule, it's wise to never pay attention to the adjectives used to describe a report. Just look at the numbers.
Some people are starting to realise the cliff that UK energy supply is going to go over:
UK experts give blackouts warning
Unfortunately they are relying on gas which may not be available to bail us out:
http://news.bbc.co.uk/1/hi/sci/tech/7723239.stm
Meanwhile estimates of the cost of the projected off-shore wind projects continue to escalate:
ScottishPower plans wind farms with Swedes
http://business.timesonline.co.uk/tol/business/industry_sectors/utilitie...
At a 35% capacity factor, that comes out to around £9 million MW of actual generating capacity.
The only reason that companies can even think of building at that rate is by massive Government subsidies.
With the Government of the UK's finances disappearing into a black hole does anyone else think that the projected 33GW of off-shore wind, costing something of the order of £99 billion, just will not happen?
At that cost you could build coal or nuclear plants and gold-pate them and still have change.
That figure is before considering back-up costs - here is the cost of one plan to provide back up in Holland:
Energy island to supply green power when wind drops
http://www.timesonline.co.uk/tol/news/environment/article5119585.ece
It seems to me that what will actually happen is that old coal plants will be kept open, and perhaps new ones built to go with the nuclear plants.
EDIT: Sterling may have started to creak so that plans to boost the economy will simply not be financeable:
Jeremy Warner: Sterling crisis threatens Brown's reflationary plans
http://www.independent.co.uk/news/business/comment/jeremy-warner/jeremy-...
In my view this would result in a rapid collapse, as mass job losses would result in house prices and commercial property prices going into free-fall, leaving the banks with vastly reduced capital bases, but without the Government having the funds to bail them out.
We will be lucky if we can keep out current coal plants fuelled, as we may not be able to fund coal imports, never mind building new capacity.
This is looking like Iceland, without the cheap energy.
Yesterday I went to UK Parliament to listen to an 'expert's' opinion on what the Government should do to adequately insulate UK housing, as usual, IMO wildly over-optimistic as she doesn't see the big picture of several simultaneous system failures.
IMO, as our UK FF declines rapidly and ELM cuts in, the UK will easily be able to meet the required 80% reduction in CO2 by 2050 (probably much sooner!) - sadly the economy will also be reduced appropriately and many will be cold in the winter since the fuel will be much less affordable than now.
In Europe, it mainly seems to be a question of who will collapse first, with the Baltics and Greece in a strong lead, but Britain coming up fast on the rails.
Check out these figures on the needed financial roll-overs though:
http://blogs.telegraph.co.uk/ambrose_evans-pritchard/blog/2008/11/11/sp_...
$2.1 trillion in European roll-overs in the next 3 years is daunting in this financial climate.
Just name the names: All of the so called G7 are bankrupted! All! You forgot to mention France, Belgium.
It was the article I linked to which did not highlight France and Belgium, as in this respect at least they are not the worst offenders.
Your contention that all the G7 are bankrupt may be accurate, but I have not seen the evidence to support it, which is not to say it doesn't exist.
Do you have such evidence? I find it too confusing and time consuming to try to compare European countries.
An interesting idea. I have been following this guy for a while and I believe he makes a lot of sense. He only leaves out one thing.
The US Military.
"Time for G-7 to count its oil barrels"
By Chris Cook
http://www.atimes.com/atimes/Global_Economy/JK13Dj02.html
"The outcome of such a market would be "energy dollar" units initially based on natural gas, but capable of being extended to other forms of energy and thereby of becoming a global means of exchange. Such an energy dollar could come to replace as a global reserve currency the US dollar, which is currently being temporarily propped up by the continuing process of massive de-leveraging, whereby dollars are necessarily required to repay dollar loans."
"Bretton Woods II
The great producer nations must be looking on in amazement as the G-7 rushes to press the "reset" button on the deficit-based financial system, thereby wiping out trillions of dollars worth of the value that producers received in exchange for their production."
Cook's comments remind me of the old Technocratic idea of an Energy Theory of Money. Others, such as Howard Odum, have put fourth similar concepts. I've tried to write about this as well, although I've not published my thoughts.
Well, if the oil and gas producing nations are so worried about their savings, they could turn those dollars into hard assets, like gold or real estate. They might even buy their own car company (or 2). Just now, GM is trading at $3.23, so it has a market cap of less than $2 Billion. Ford is a little pricey at $4.6 Billion today. Maybe Paulson should just buy the company(s), instead of propping them up long enough for the management types to collect another fat bonus check and grab their golden parachute on their way out the door. Naa, that's too much like SOCIALISM!!
E. Swanson
I agree 100%.
If the government could buy controlling shares of these companies, restructure them, and then sell their shares, the cost to the taxpayer could be negligible (since we can hopefully get the money back when we sell the shares). However, if we bail them out (again) then we've got ongoing corporate welfare cases. And maybe they both need to be merged... GM + Ford. Might help.
Black_dog - Then when oil becomes scarce we move to the human energy unit of exchange aka the Slavero.
P.S. Our local movement currency is called an Hour.
Buy GM and turn ownership over to the UAW.
Is this the same Chris Cook that was the consultant/advisor for the Iranian Oil Bourse on Kish Island?
Ha! Yes I believe so and that has not really taken off has it.
The only answer to all this mess is: Short the stock markets. I have been shorting the broad stock market a long time ago. And I have made good money with that. I'm still shorting and I will short till the S&P 500 is near 400 points.
Man accused of stealing communion wafers. I wonder if he's crazy, or just hungry.
Stores are in a panic. And applications for holiday retail jobs surging...but the chances of getting hired are slimmer than of getting into an Ivy League college.
Denninger thinks we're nearing the point of no return. He's predicting a brief rally, then Great Depression II, starting early next year.
Ugh, I hope this isn't true...
I hope the guy living in the cardboard box on Denninger's site had his rabbitt ears hooked up to his government purchased HDTV box. If not, he will miss out on all the "wonderful" news that will be happening around him. I tell ya, if you are not sober when you read Denninger, you will be once you finish reading today's entry. John
Totally off-topic, but I just bought one of those boxes (yes, my home has no cable, no satellite, no internet) and surprise surprise, the antennae I have results in zero digital signal. I suspect thousands (millions?) will face the same results and will lose TV reception completely when the analog signals cease. Then what? I am all for less TV viewing, but I like getting PBS in my home and watching Dave Letterman now and again. Sigh.
I've done without TV since 1975. You won't miss it.
I have TV as a background. Some people listen to music, but I actually prefer TV. It even works for me, so that I can get asleep faster.
TV is a magical drug ;)
I haven't had one full time sense the late 1960's. I was a product of the UC system of the 60's, and the only thing more despicable than TV was drinking or going to Vas Vegas (LSD and cannabis were quite appropriate).
During the 70's and 80's I lived with various women who occasionally had one, and finally put my foot down while living in Maui in the early 90's. Been totally free since.
I wrote syllabi for some neuro researchers, and they found that even the content was not that important, as TV put one into high alpha (a very pleasurable state) almost immediately. It's the medium itself that is the problem.
Of course, as a propaganda tool. TV is unsurpassed, with high alpha being a very easy state to influence.
I read somewhere that the brain is using less energy when watching TV than when asleep.
ROTFL! But, I don't (quite) believe it. But I will admit to the anecdotal observation that many people can sleep quite soundly with the TV on, but instantly awake the moment you turn it off.
Check out AntennaWeb.org . Hit the "Choose an antenna" button to get started.
One difference between analog and digital reception is that analog picture quality degrades gradually as the signal gets fainter whereas digital picture quality falls off a cliff. That said, with a mere $30 indoor directional antenna I get a nearly flawless signal from several stations that are about 40 miles away. Pretty amazing.
The interesting thing is that two really smart guys have taken polar opposite views on the US dollar. Denninger sees major difficulties in financing the looming deficits (2009 is now forecast at 2 trillion) while Mish feels the US dollar is a safe haven because of deflation and the fiscal deficit cannot weaken it. IMO Denninger is right, but Mish has been right on so far.
Apparently the Wise Men and Women of the American Establishment have decided that this village must be destroyed in order to save it. It's hard to fathom how this may play out except badly -- and yet, these are people of wisdom, experience and vast means. They have been to Ivy League colleges, and they must have information that we just can't tap into, trapped here in our little hidey holes.
We must trust our leaders!
?
Re Summers, I realize Obama is just starting but his teflon coat is already impressive. Imagine if Hillary Clinton, for instance, had aggressively pushed the bailout scam and then chose this grifter as head of the Treasury-IMO there would be a lot more outrage.
Obama's Bailout Bunch Brings Us More of the Same
Not even one Spitzer to cause some trouble-Obama hasn't even been sworn in and he is already a huge letdown.
You guys are expecting too much of Obama. His "miracle" was to be the first person of color elected to the US presidency. He may yet prove to be the right person for the job and the times but he's going to have to ease into it. Don't forget that a signficant portion of the American population believes he's in cahoots with Karl Marx and Osama bin Laden.
marx as he said before his death was no Marxist using it in the version that it became in his lifetime.
Summers is down big (six points) on Intrade today, Tyson is up 10.
What I find interesting is that it's taking him so long to pick one. A lot of the talking heads were expecting him to do it right away, perhaps as soon as last Friday.
But he's put it off, which suggests to me that he's having trouble making up his mind.
The really interesting race on Intrade is Sec of State. It's wide open.
Richardson, Hagel, Holbrooke and Kerry are running best, but all are between 15-20.
Al Gore is trading at 10, up four points on the day. That's an easy short in my book.
I feel that the delay may be a deliberate ploy. If he had had someone in place, then they would at least have to comment on the results of the meeting of the heads of Government.
Not having a prospective Treasury Secretary in place means that the Bush administration is cornered into taking the full blame, and can't pass any of it on.
I think he knows that there are no good solutions out there.
Got bullets? From reading the article above, we'll need them if this guy Summers gets the job.
Atleast one section of the economy is thriving, maybe Armalite will takeover GM.
http://edition.cnn.com/2008/CRIME/11/11/obama.gun.sales/index.html
http://www.kgw.com/sharedcontent/APStories/stories/D94D9T0G4.html
Denninger has another entry up:
How Do You Spell "Liquidity Trap"?
Well, there's no doubt then, Weimar Germany-style printing it is. It is a logical consequence anyway.
Karl is angry, but being angry doesn't help at all. I am trying to stay calm, focused and as much positive as I can.
I think it is time to hide ourselves and stop saying anything that might hurt. I was telling people that they made mistake to buy homes on credit (and other), but I am not going to be a smart ass anymore. Good that I am not a member of minority. I wanted to emigrate, but I feel safer at home.
The only question is now: will I join the masses when they get angry and they want somebody to blame/kill? I probably will. It is better to kill than get killed.
I intend to remain a moderate, and argue to spare their families as the bankers are lynched.
That could prove dangerous however.
Ever hear the song 'Golden Country' by REO Speedwagon?
...Golden country your face is so red
With all of your money your poor can be fed
You strut around and you flirt with disaster
Never really carin just what comes after...
...Mortgage people you crawl to your homes
Your security lies in your bed of white foam
You act concerned but then why turn away
When a lady was raped on your doorstep today...
I'd love to hear a modern band cover this song and rerelase it.
Bankers are not important. Angry people will go after minorities. Mexicans are stealing jobs to hard-working American and so on.
Regarding religion, I will probably start to practice it, although I am an agnostic. Agnostics won't kill religious, it is going to be the other way around (IMHO).
May we live in interesting times.
Sprechen sie Deutchmark, baby.
Mish is convinced that the US dollar will stay strong-if TPTB believe that, then the Weimar is the way to go-it is a magical money machine-just print up as much as you feel like.
Wow, the Dow is down almost 300 points. I guess they didn't like what Paulson had to say.
Nevertheless, I am long on the s&p 500. Down 500 bucks for now, but still holding.
I think that the market doesn't care about Paulson anymore, lately it is tanking when any important politician is giving a speech.
WHY would you be long S&P, or ANY broad index in this market?
bear market rally expectation =)
Would you believe minus 411 and change?
and that banks won't buy smelly mortgages :(
and also Starbucks hits the skids (at least there is some good news) :)
http://news.yahoo.com/s/ap/20081112/ap_on_bi_st_ma_re/wall_street
Hey, did you read that new sex survey by Cosmopolitan Magazine?
Yeah, turns out there are no more virgins in American anymore.
We've all been screwed by Henry Paulson.
Actually, I read something similar about the VP and the current prez. It was titled 'Dick and Bush: Screwing America since 2000'.
Long ago we were all f$%^$ed by Bush and Cheney.
The article about Mexico reeked of ELM.
Yeah, wait until ELM hits the KSA. Then, TSWHTF ASAP.
KSA has a looong way until ELM starts to dent their exports. they consume something like 2 mbpd and produce 9, and also have some spare capacity?
they can get away with increased consumption for a loong time, long after most of today's exporters will be importing oil
But here's the Million Barrel hypothetical...
If they produce 9mbpd but consume 2, then there's 7 to go around.
If let's say (hypothetically) they are able to ramp up production to 10, but consume 3 1/2 then there's only 6 1/2 to go around.
It's not necessarily the point at which they consume more oil than they produce that's the problem. It's the point where their consumption increases more than their production that's the problem. At that point, they've essentially peaked (with respect to the rest of the world).
On a total liquids basis, I estimate that Saudi Arabia will produce about 10.9 mbpd and consume about 2.5 mbpd in 2008, resulting in net exports of about 8.4 mbpd, versus 9.1 mbpd in 2005. Our middle case has them approaching zero net oil exports in about 23 years.
Then, in a sense, Saudi Arabia has peaked? I mean, their exports will now continuously decline...
I've read that Saudi Arabia has been increasing the size of its petrochemical industry, taking advantage of its access to crude oil at below the world market price. If it exports these chemicals does that count as consumption of oil or exports of oil?
They are counted in the "net exports" category. Oil used as feedstock in the making of these products are not counted as exports but the products themselves are counted as exports when they are exported. They are not counted as consumption of oil. You simply take gross production and then subtract net exports in order get net consumption.
'Net Exports' Peak Oil is primarily an energy problem, specifically for transport in importing countries, there has to be more energy in the oil than is used to obtain it for transport uses but there is no need to worry about EROIE for chemicals and plastics.
There is enough known oil to last hundreds of years for chemicals/plastics - URR reserves of oil economical for energy uses are much smaller than total reserves.
When an oil well's production for energy is energetically uneconomic the rest of the oil (the majority?) left behind can still be extracted some other way if somebody is willing to pay the price - Canadian Tar Sand mining is an example where the deposit is close to the surface.
That is an absolute crock of donkey doo! The same oil that makes gasoline also makes asphalt and plastics. When an oil well depletes what is left is water, not something you can produce asphalt or plastics from.
That is true only to the extent that we can prevent the oil from being squandered by being burned up as fuel. Our record at that hasn't been too good.
Darwinian, to quote you ... that is an absolute crock of donkey doo ... most of the oil is left insitu by extraction using oil wells, they are VERY inefficient, depeleted oil wells still contain a very high grade hydrocarbon ore ... if the oil is required for uses other than energy, if profitable, it can be mined some other way (just like things like gold, silver, iron, aluminium etc etc).
There is no reason coal could not be used either, and we are not going to run out of all resources of that.
It would cost more, is all.
Might I caution that the 23 years is like saying BAU. Any negative Black Swan surprize and we are into negative ELM damn quick.
The recent history seems to imply that demand side blackswans (which cut demand), are more common that supply side blackswans (which destroy supply).
The concept of Mexico becoming a "net importer" of oil is confusing at best and misleading at worst. Mexico has no significant demand for domestic OIL consumption today. It has little refining capacity and has been a fuel importer for some time. And they buy these fuel products with revenue from their oil sales. If they don't export their oil they'll have to shut in most of their remaining production: they have very limited refining capacity. In order to meet domestic fuel requirements they must continue exporting most of their oil production to fund fuel imports as well as fund a major portion (40% as last stated by the M gov't) of all gov't services.
But those oil exports will continue to decrease dramatically as Cantarell Field quickly approaches its late stage depletion stage. If one takes his statement as accurate what he is actually saying is that Mexican oil production will just be sufficient to supply their limited refining capability. I’m not sure what that volume is but recent efforts to change the constitutional laws allowing foreign investment in refining failed. Regardless of that fact, who would build additional refining capacity when even the mid term ability to produce oil is questionable? As bad as the Mexican economy is today, wait 5 to 8 years when the gov’t has lost 40% of its income. What does it do then? Reduce its very limited social safety net 40%? Lay off 40% of all gov’t workers including police and military? Mexico may become something close to the worst doomer’s vision of a Mad Max world
No, it is really quite clear. If Mexico were to export 1 million barrels of crude oil or petroleum products per month and import 1.5 million barrels of petroleum products per month then they would be a net importer. It is really that simple. Being a "net importer" in no way means that you cannot also be an exporter of oil. It simply means that you import more in petroleum products than you export in crude oil.
It simply does not matter what the refining capacity of Mexico is. That is, even if Mexico could refine only one half of their crude production and must export the other half while importing more than that half could possibly produce, they are still a net oil importer.
Darwinian, what Rockman was saying, is that Mexico needs to remain an exporter because it needs the foreign exchange. If you grant him that (I am dubious, as they have been getting remittances from their workers in the US), then they must cut their consumption to stay below the level of their production. It's all a matter of affordability. If they can *afford* to consume more than they produce, they will become a net importer. If they cannot afford it, then their consumption will collapse even faster than their production.
Amy Jaffe:
And if the UK's North Sea production platforms had not been seized by tofu wielding Vegan terrorists, the UK would still be a net exporter, and don't get me started on the tragedy of the Midland, Texas based Communist takeover of Texas oil fields.
Westexas, you da bomb. Keep up the good fight.
Encouraging drumbeat today, seeing that Paul Krugman + Al Gore = The way forward article just made me smile, I love it! ;)
Re: Mass-Transit Projects Fared Well at Polls I can comment in Atlanta we passed a revision to the state constitution to allow funding the beltline project with Tax Allocation Districts, which were formerly only allowed to be used for education funding. So, we might get our tram after all. They've started groundbreaking on it already.
What is perhaps slightly more amazing is that the agents of sprawl, real estate developers, tried to slip through an incredibly obfuscated amendment:
Does this mean anything in actual English? No. We were very fortunate and it wasn't passed -- it was basically a way for real estate developers to make subdivisions however they pleased and issue their own bonds and tax people as if they were a municipality.
I don't know Gwydion...it seems like clear language to me. The Gen Assembly would be free to design new taxing entities without voter approval. No tax payer control over the tax rates, their structure (property taxes...business/personal income taxes...etc) nor how they would be spent. I'm sure your real estate developers were gone to be very willing to help your elected official (who are always looking for campaign contributions) to figure out those details.
Giving the falling tax revenues of all taxing authorities I would expect to see many more such efforts especially where state constitutions prohibit such matters.
NYT has a fun poll up about who their readers would pick for various cabinet positions.
Unfortunately, they don't have the Secretaries of Energy and the Interior up there, maybe we could do one like it on TOD just for fun? I'd probably vote for Al Gore for energy secretary. I still have fond memories of Bruce Babbitt as Sec. of the Interior, I'd probably vote to bring him back.
Is this really true? Study Points to Major Source of Natural Gas in Alaska
I thought the consensus was that gas hydrates were too unstable to produce? Did something change in the last six months??
AFAIK the problem with instability refers to undersea deposits, at least primarily, as a fast release there would result in huge inflammable bubbles of methane exploding through the sea, wrecking equipment and endangering lives.
I was interested to note in the article that they say that tapping on-land fields needs essentially present technology.
The fields in West Texas and Wyoming may be exploited earlier than Alaska, I would have thought, as they are more accessible.
and, of course, methane is 30 times more potent as a green house gas than CO2. It has a shorter lifetime in the atmosphere, but quite long enough to make methane hydrates very dangerous.
but what happens to the methane in the atmosphere ? doesnt it just oxidize and form co2 and water ?
It does. IIRC the atmospheric lifetime is on the order of ten years. Of course molecule for molecule the warming capacity is much more than the widely quoted 23 times figure. The figure of 23 compares the net warming from releasing a molecule of methane, versus a molecule of CO2 would have over a century. The methane contribution is much greater the first few years, but will be negligible long before the century is over. A good part of the CO2 will still be in the atmosphere at the end of the century. If the "averaging" time were shorter than a century, the relative effectiveness of the methane would increase. If the averaging time were made longer, the relative importance of the CO2 increases (as CO2 is the global warming equivalent of the energizer bunny -the gas that keeps on warming).
Palin sent word upon high,,,and was rewarded with a gift from above. Methane Hydrates instead of the Vice President's job.....
May she be cursed by the gods to emit methane from both her state and her body.
Earlier this year I questioned the truthfulness of this EIA report, expressing my belief that the EIA had come under the spell of Aubrey McClendon and Boone Pickens and the "from shale to shining shale" panacea they were peddling:
http://tonto.eia.doe.gov/energy_in_brief/natural_gas_production.cfm
Amongst other things, the EIA claimed that U.S. natural gas production experienced an "exceptionally large 9% increase between first-quarter 2007 and first-quarter 2008" and that "more than half of the increase in natural gas production between the first quarter of 2007 and the first quarter of 2008 came from Texas, where supplies grew by an exceptionally high 15%."
At that time I cited the following data from the Q1-2008 financial reports of the ten largest U.S. natural gas producers, which shows only a 5.5% YOY increase for that period, and pointed out that according to a Helmerich & Payne report that 17% of the increase in reserves of these companies from Dec 31, 2006 to Dec 31, 2007 was due to acuqisitions of previously existing gas production. So if we take that into account--adjust for the increase in production due to moving the chairs around on the deck--the YOY increase for the period amounted to only 4.5%.
United States Natural Gas Production (MMCFPD) Q1-2007 Q1-2008 Conocophillips 2.31 2.06 Anadarko 2.20 2.14 BP 2.16 2.15 Chevron 1.72 1.67 Devon 1.62 1.88 Chesapeake 1.56 2.06 ExxonMobil 1.51 1.31 Shell 1.16 1.11 Encana 1.22 1.55 XTO 1.26 1.71 TOTAL 16.72 17.64I also cited Texas Railroad Commission (TRC) data that did not support the 15% YOY increase EIA claimed for the period:
http://webapps.rrc.state.tx.us/PDQ/home.do
Gail the Actuary called the TRC. They indicated they had a work overload and were lagging behind in getting the data entered into the Prodcution Data Query system. However, we are now 7 months past March and TRC data is still indicating only a 9.3% YOY increase in Q1 production.
Here's the latest data from Q3-2008 quarterly financial statements for the ten largest natural gas producers in the U.S.:
That is only a 2.8% YOY increase for the third quarter.
For the first 9 months the data looks like this:
United States Natural Gas Production (MMCFPD) 1st 9 mos. 2007 1st 9 mos. 2008 Conocophillips 6.97 6.26 Anadarko 5.64 6.00 BP 6.52 6.38 Chevron 5.12 4.69 Devon 5.10 5.82 Chesapeake 5.13 6.34 ExxonMobil 4.46 3.75 Shell 3.38 3.15 Encana 3.91 4.85 XTO 4.15 5.46 TOTAL 50.38 52.7That's only a 4.5% YOY increase for the first nine months.
Meanwhile, according to an article Leanan linked to yesterday, EIA in its Annual Energy Outlook is still making what seems to me like an overly optimistic projection of 6.8% increase in natural gas production for this year over last year and is under political pressure by industry insiders to revise even that overly optimistic projection upwards:
Another piece of fiction the EIA is peddling concerns U.S. natural gas reserves data from this article Leanan linked to some time back:
The Helmerich & Payne study, however, showed that natural gas reserves for the 20 largest natural gas producers, after removing reserve additons due to acquisitons, to have increased only 4.4% from Dec 31, 2006 to Dec 31, 2007.
The Helmerich & Payne study was made by examing the financal statements of those 20 companies.
It looks to me like the EIA also has an abundant supply of the "fairy dust" that garyp talks about in his above comment.
Let me tell you what may be the problem with your analysis. If we look at US total numbers based on EIA data, total marketed natural gas production per day is as follows:
What is happening is that there are the oil companies, whose natural gas production is decreasing. In your list, it is Conoco Phillips, BP, Chevron, Exxon Mobil, and Shell. You could add up their production, and get an indication as to what their change in 9 month production is. There are also the primarily natural gas companies. Those are the other 5 companies on your list. It would be worthwhile getting a percentage change for them as well.
If you look at the data on the graph, it comes to about 60 million cubic feet per day. The data you are showing comes to about 17 million cubic feet per day. (Your first three quarter numbers need to be divided by 3, since they are on a per day basis.) The 17 million a day production you have calculated is not really a representative sample of the total. The oil companies you have are pretty much all of the oil companies out there producing natural gas, while there are a lot more independent natural gas companies (all small) which have ramped up production, and are not in your sample of 10 companies.
Last year, one could guess that the oil majors produced something like 10 million cubic feet of natural gas a day, and independent natural gas companies last year produced something like 45 out of the 55 million cubic feet a day. (If you have a different breakdown you like better, use it). Apply the percentage increases you get to these two groups separeately, and add them up. I think you will get something closer to the EIA indications.
I believe all the units should be in BCF a day, not millions a day
Sorry, you are right.
I'm not buying it, Gail.
While these 10 companies may produce only about a third of all natural gas in the United States, according to Texas Railroad Commission statistics in Q1-2008 they produced 64% of the natural gas from the Barnett Shale, which is by far and away the largetst and most prolific of the shale plays.
If you look at the 20 companies that Helmerich & Payne used in their sample, while they produce 46% of total U.S. natural gas, they produced 76% of the natural gas produced from the Barnett Shale during Q1-2008.
If anything, either sample--the 10 largest or 20 largest--is overweighted to non-conventional gas.
http://docs.cpuc.ca.gov/published/Report/54256.htm
Here's a different and more recent study from the EIA. It says that the top 10 natural gas producers produced 41% of the total in 2006 and the top 20 produced 58% of the total.
http://www.eia.doe.gov/pub/oil_gas/natural_gas/data_publications/crude_o...
But the point still remains--either sample is still overweighted to non-conventional gas production.
And by the way here's a link to the study I cited above. And it's not Helmerich & Payne but Williams Companies that did the study:
http://www.williams.com/investors/docs/1Q08_slides.pdf
Given the low price of NG a drop in production is very likely. But the industry is pushing that "abundant natural gas" story hard! They need those CNG vehicles to prop up prices. They should fund "anti-coal" campaigns instead.
What will be interesting to see is how steel prices (tubular steel in particular) react as production drops. Will drilling costs go down? Are they high because of demand? Or are they high because dropping EROI is working its way in a wide circle back to drilling costs?
Snap Shot of a ToD reader:
I have two jobs. I work for Sams Club and a 501c3 non profit shelter. I have 2 roommates and I indulged a little too much in credit cards in the last 2 years. I am also a renter who has seen his rent jump 25% in the last 6 months. I am moving to a nearby city which is larger and has cheaper gas prices (for now). I plan to now commute for the first time ever 40 minutes each way to both of the jobs I work now. The upside is that my rent is substantially lower with the move and I get a boost from a 50% drop in fuel costs. For the first time I feel as though I am starting to circle the drain. I watched for the last 14 months as this forclosure mess started and did not really feel an impact until now. All of the part time jobs I wanted to replace Sams Club with have evaporated. The point I am trying to make is that I feel that this is all going to get substantially worse as we stair step our way over the gorge. I had made plans to pay off my debts by 2010 thinking that the real calamity wont befall us until around 2012. You know what they say about best laid plans. Either way I am working very hard to adapt to a new paradigm that is working its way in on fast forward. I am joe american. This is all becoming very real. I cut up my credit cards but I am still unwilling to default on anything. I feel now the same as I always have, That you make good on your promises. Best of luck.
Good for you on having cut up your credit cards. They are a terrible scam perpetrated on the people. I never wanted a credit card but needed one in order to bring a vehicle into Mexico. For several years I used it to order books online and so forth, paying off the balance at the end of each month. Then I unwisely used it to finance a trip to Brasil, and soon after used it to pay for expensive & unexpected vehicle repairs. I ended up with around $4K cc debt, which took me a year or so to pay off. It burnt my ass to be paying that exorbitant interest but I had no choice. Once I'd paid off the debt I cut my card up and haven't had one since. If I ever go back to Mexico I'll ride public transportation, which provides for a more authentic travel experience anyhow.
ZeroNerve,
I have a credit card. It has slowly risen over the years. I pay the minimum each month religiously but not a cent more.
You will not be defaulting if the CC company goes bankrupt and can't collect debts on CCs. You only have to pay the minimum due each month.
I suggest its far wiser to use excess funds to further your sustainability plans.
I will state that I live on the land I own outright. No one can take it from me. I live free. I pay my debts , but I intend to pay no more than I am billed. The rest is mine to use as I see fit.
I have had CCs almost forced on me. One for just opening an checking acct at a bank. I signed nothing for it as I recall. I don't use it either but the one I use I have had for many long years and have never been able to clear it and intend to do just exactly as I have done in the past.
BTW many it appears are just walking away from their home loans. It seems even our government is assisting in this matter and almost seemingly to encourage this. Then give out tax dollars to the very same firms who created this morass. Strange.
My advice. Get a plan. Work on it daily. Let it consume you. Make it happen. I am talking about moving to a sustainable lifestyle.
IMO life in a urban or suburban dwelling place is definitley very dangerous to your life if TSHTF as expected..be it slow or fast.
People are not to be trusted these days. They have changed.
I have lived in the burbs with people I would hesitate to turn my back to if things went awry. And that was a looong time ago.
Airdale
PS. Yeah yeah, I know..go kill a possum(as my detractors tell me)
Well too many possums have already been killed by idiots driving iron penie on our back roads. Now its the infamous bambi-killers come to leave their 'field dressings' scattered about so our dogs eat rotten remains and sicken...yeah city folk big game hunters....too much time spent in Gander Mtn or Cabelas watching ignorant videos ...were they to even come and ask first and do it right then I would mayhap let them hunt my land but nooooooooo.....several more weeks of not riding horses and keeping a careful watch on stock...And if they climb a tree and your dog sniffs them out then guess what? They shoot your dogs. Sheeeesshhhhhh!
If only it worked that way! In reality the bankruptcy court would sell the accounts recievables to someone else, who has the legal right to force you to pay up. He might even hire Rocky Balboa to break your legs if you fall behind!
Oh you mean like the broken legs of those who just 'walk away' from their McMansions? This is far far greater than CC debt.
I don't see this 'force you to pay up'...happening nor do I read about it.
The number of CC holders , and add the multiple cards, is got to be enormous and IMO when the dam does break NOTHING will stop the flow of blood,or set it aright.
This along with AG is going to be the next pieces of the merry life we lead that will fall to the ground and may never recover.
Already I would bet that the upcoming Christmas shopping season will spell the very end for many many merchants. The ties will go right back to conglomerates/huge corporations , who will likewise falter and fall to the ground, never to arise again.
Trading chits of paper will not make it happen either.
Real physical work by humans is the only thing of value and then only if you produce something of value that someone else desires and can bargain you for it. All else is folly. We have been riding the 'folly car' for far too long and now comes reality.
I suspect when the CC companies decide to increase rates to unreasonable levels that this is when the dam breaks.
They really can't do anything about the people who walk away from mortgages. They can't freeze your bank accounts, garnish your wages, or put a lien on your other property. (Assuming you never refinanced.) Basically, all they can do is take the house back. Once they foreclose, the debt is considered discharged, and they can't send anyone to break your kneecaps.
Credit card debt is different. That's why Denninger says stop paying your mortgage today. But not "stop paying your credit cards today."
(State laws vary, so you should of course consult a lawyer before doing anything drastic.)
There's even a business that helps consumers walk away from their homes - for a small fee, of course: YouWalkAway.com.
2008: The year of global food crisis
Contrary to what even some on this list believe, the upward spiral of hunger has already begun. World food prices have risen by 75% since 2000, while wheat prices have increased by 200%. People who once lived on the very edge of starvation has now been pushed over that edge.
High fuel prices and falling water tables are causing famine and despair in India. It costs more and more to irrigate less and less land. At a time when every ear of corn is needed to feed hungry people we are using it to make biofuels instead.
Ron Patterson
I am in complete agreement with you, but let's admit it: nothing can be done about hunger in 3rd world countries. Even more - I believe that Western influence can be even harmful, not helping.
Jay Hanson's goal is simple: reduce human suffering. We are unable to do it though.
EDIT: Of course, biofuels are making thing worse now, but maybe it is better than n people suffers in 2008 than 1.2*n people in few years time.
Past government policies in the United States resulted in artificially low grain prices. Recent shifts in the grain markets have increased grain prices. Rising grain prices mean some people go hungry. Dropping grain prices either means farmers will stop producing because they have gone broke or government payments(your tax dollars) will be required to keep production artificially high.
I do not see an easy solution that keeps food prices low so everyone is fed. That does not touch the issue of long term stability.
High grain prices may over time increase production in some of the countries referenced in the article but that would involve changes by the governments of those coutries.
Approximately 40% of the world’s grain harvest is fed to animals (1). It's an extremely inefficient and harmful practice that causes staggering animal and human suffering, not to mention environmental devastation - 18% of anthropogenic CO2 equivalent emissions are from livestock, compared to 13% for all of world transportation (2). So the next time you make fun of someone driving an SUV, think about whether the food digesting in your stomach caused even more damage, because the likely answer is yes if you eat meat and dairy.
If people and goverments actually cared about the starvation of others they would be eating a vegan diet while viewing animal products as the grossly unethical products that they are. Nothing causes more suffering and environmental damage than the fork and spoon of meat and dairy eating people (just ask someone who lives next to a hog lot, with their "lagoons" filled with waste that seeps into the groundwater). And you have 100% control of what you put into your mouth, so there is no excuse other than laziness. Energy descent is going to destroy factory farms and mass livestock "production" - the sooner, the better for human suffering, animal suffering and the health of the planet. This is somehow one of the most controversial assertions possible, yet the facts are blindingly obvious to critical thinkers.
1. Leitzmann C. Nutrition ecology: the contribution of vegetarian diets. Am J Clin Nutr. 2003 Sep;78(3 Suppl):657S-659S).
2. 2005 UN report "Livestock's Long Shadow."
Do you eat rice, veganmaster? Then stop it immediately. Rice fields are major producers of methane.(1)
Better we all return to eating oat groats all day and night, like the old vikings did.
1. http://www.ciesin.org/TG/AG/ricecult.html
If food prices are sky-rocketing, why are farmers desperate?
One would think that more biofuels would be a good thing, as it would give more money to farmers.
I think the problem comes mainly from the difference in purchasing power between hungry people and producers. Farmers in rich exporting countries feel that prices are too low, and are ready to cut production/make biofuels, while poor people are unable to buy grain.
I'm not a big fan of biofuels, but urban sprawl and parking lots taken up much more farmland than biofuels. While paving up farmland is easy, I'm not sure that reconverting foreclosed houses back to farmland is.
Corn=corn syrup=fast food= obesity
We should consider the calories from corn going into corn syrup. If we quit manufacturing that, there would be a lot more corn grain to distribute world wide. And fewer obese Americans.
Proceedings from the National Academy of Science, to be published on 11/18/08
Carbon and nitrogen stable isotopes in fast food:
Signatures of corn and confinement
A. Hope Jahren1 and Rebecca A. Kraft
Department of Geology and Geophysics, The University of Hawaii, Honolulu, HI 96822
Communicated by Steven M. Stanley, University of Hawaii, Honolulu, HI, October 2, 2008 (received for review July 3, 2008)
Americans spend >100 billion dollars on restaurant fast food each
year; fast food meals comprise a disproportionate amount of both
meat and calories within the U.S. diet. We used carbon and
nitrogen stable isotopes to infer the source of feed to meat
animals, the source of fat within fries, and the extent of fertilization
and confinement inherent to production. We sampled food
from McDonald’s, Burger King, and Wendy’s chains, purchasing
>480 servings of hamburgers, chicken sandwiches and fries within
geographically distributed U.S. cities: Los Angeles, San Francisco,
Denver, Detroit, Boston, and Baltimore. From the entire sample set
of beef and chicken, only 12 servings of beef had 13C < 21‰; for
these animals only was a food source other than corn possible. We
observed remarkably invariant values of 15N in both beef and
chicken, reflecting uniform confinement and exposure to heavily
fertilized feed for all animals. The 13C value of fries differed
significantly among restaurants indicating that the chains used
different protocols for deep-frying: Wendy’s clearly used only corn
oil, whereas McDonald’s and Burger King favored other vegetable
oils; this differed from ingredient reports. Our results highlighted
the overwhelming importance of corn agriculture within virtually
every aspect of fast food manufacture.
Have you noticed the corn industry is now pushing back on high-fructose corn syrup? They're running a series of TV ads where people who think HFCS is bad for you are ridiculed by their more-informed peers, and end with a pointer to this site.
Yes- the Sweet Surprise campaign is a premptive strike against a corn syrup backlash. They saw the writing on the wall with ethanol. Corn syrup will be exposed as the next huge waste of corn energy disguised as "food."
Just read about Picken's plan falling through... (posted at top, but here's the link:)
Pickens' wind plan hits a snag
So, what is needed to make a major switch to renewables viable are as follows:
1) High/increasing cost of traditional fuel sources
2) Cheap and easily available credit
3) A stable or growing demand for energy
4) Proven and financially competitive technology
And... with the upcoming recession, we just witnessed items 1-3 just drop off the table. Wind still is neck and neck with coal for being competitive, but unless there's demand for it and credit to build turbines it just ain't gonna happen.
The new STEO is out. Consumption exceeded supply through 2007 and through Q1 of 2008. In Q2 and Q3 OPEC production increased and consumption declined. Traditionally consumption is lower in the summer. The STEO forecasts that consumption will exceed demand in Q4 of 2008 and in Q1 and Q2 of 2009 before supply again exceeds consumption. The STEO assumes that KSA is essentially the market setter in their scenario:
EIA expects OPEC surplus production capacity to rise above 3 million bbl/d next year for the first time since 2003, which would provide Saudi decision makers with a cushion large enough to provide a capability to dampen the impact of future disruptions or geopolitical uncertainties on oil prices.
Hints of what is coming:
This months electric bill was meaningful. Last month I used right at 700 KWH. The bill was for about $90.00.
This month(octobers bill) was for 400 KWH and the amount was about $78.00
So my going to wood heat didn't help much. When I spoke to the supplier about this immense increase I was told that the TVA had set the new rates for this last quarter and everyone was increased that was served by this particuliar co-op.
I figure it as about a 30 to 33 percent increase.
For those who are full time users they are surely in for a big suprise.
Not only did the KWH rate increase but they told me the Basic Rate had also increased by about the same percentage. Meaning that even if I used ZERO kwh for the month I would still be billed and now even more.
TVA uses primarily hydro but mostly coal. Those who are served by TVA are going to be angry. I know I was but I was prepared for it anyway and have made sure I was not locked into to primarily electric heating and cooling costs.
Airdale-one doesn't need a Chinese Fortunate Cookie to tell the future
Note to self: lay in two more large containers of kerosene,start building my hives for this spring and planning on beeswax for candles,whatever.........
Does this mean the price of power fluctuates with streamflow? Note of course that export prices of coal have plummeted since the summer peak. But perhaps the utlities commision bases their price on a running average of the price? In which case, you are now paying for last summers expensive coal.
On July 8th Boone Pickens predicted the price of oil would hoover around $150, then drop to about $100 in two years.
http://www.cnbc.com/id/25564736
Russia having difficulties giving up lucrative windfall profits export taxes making some oil production projects unprofitable.
http://www.reuters.com/article/rbssEnergyNews/idUSLB46205420081111
Global warming has yet to put winter apparel retailers out of business. The warming trend has been ongoing for up to 20,000 years. As the ice melted in Siberia ivory collectors searched for the tusks of woolley mammoths buried in snow as much as 40,000 years ago. Maine was buried under a mile of ice. What a catastrophe the ice age was, how nice it is to have warmer weather at northern latitudes. I do not suppose the Paleolithic tribes had massively exploited deep coal seams to cause this natural round of warming.
Warren Buffet About Debt:
"It is not debt per se that overwhelms an individual, corporation, or country. Rather, it is the continuous increase in debt in relation to income that causes trouble." Washington Post, 9/14/1993
Someone got out their calculator and the grifters have soaked the USA taxpayer for 5 TRILLION so far (and counting)http://www.forbes.com/home/2008/11/12/paulson-bernanke-fed-biz-wall-cx_lm_1112bailout.html
Unbelievable.
Even CBS Evening News was talking about how there seems to be no one who knows where all this money is going or what it's being spent on. There is zero accountability and zero transparency.
I am struck by the brazeness of Paulson. The man has no shame.
Here is a link to a map showing the voting results for President on a county by county basis for the WHOLE USA.
Before you click on the link I advise you to be prepared for a very big shock. I was,shocked. I had no idea.
Now for those who disbelieve the map then please submit some modicum of proof that its wrong. Not just opinions or assumptions,,proof.
After viewing it then tell me that the country folk are anywhere near the same as their city cousins, in their political viewpoints. Yet they take a huge amount of flak over the issue.
Here is the link:
http://images.newsmax.com/misc/2008_Election_Map.jpg
Airdale
Here's an interesting set of maps, too.
Scroll down for links to similar maps from other presidential elections (2004, 2000).
Here is an animated .gif file of elections from 1960-2004. (warning, large file)
What's your point, exactly? If land could vote, yes, John McCain would have been elected President. But those blue bits -- though they take up less of the map -- are where a majority of the people live.
I think that Airdale's point is quite evident: that there is a city/country divide in the USA and that geographically speaking most of the country remains in the red column.
Long range, for sure, and potentially even short range, I suspect this will have considerably implications for US social peace, particularly when the economic dirt hits the fan in the coming months.
Like most outsiders, my bias was (and is) towards Obama over McCain, but I would be foolish not to recognize the formidable challenges the man is facing as he sets out to govern. These voting patterns will likely prove to be a very useful guide to showing where the most opposition and resentment is likely to arise.
Yeah, but this is news? How can anyone be surprised by that map, when it's looked that way for the past several elections?
So what is it about Wisconsin- largely rural, smaller farms, more animal agriculture (in the pasture and milking kind of way-- not confinements), more culture. Wisconsin is the place to be.
I've also noticed that blue follows the riverways- even in rural areas. In Minnesota, blue aligns with the Red River Valley and the Minnesota River. If you looke down the Mississippi you will see that the adjoining counties are blue. In Minnesota this is NOT related to population levels or cities. Some of those blue counties are the least populated in the state. I wonder if our socialist/Scandanavian dominant base pervails even after a few generations.
Could be. Though a friend of mine who lives in Minnesota credited proximity to Canada.
As for the rivers...my guess would be that that's a remnant of our industrial past...and the unions it spawned.
Good theory about unions and rivers. But I can tell you there is not one single industry/union in this rural democratic county and we are democrat- as are our neighbors. Also, Minnesota does not have the Democratic party. We have the DFL the democratic farmer labor party.
Peshaw! Aboot Canada having an influence on the politics. We have a long heritage of progressive politics here aboots.
I've seen those maps before ..
They're misleading ..
Acres don't vote ... people do ..
Triff ..
Today I became aware of a Mr. Michael Pollan.
I believe I followed a link via a post someone made on TOD.
In any event I went to a site and viewed most of a 59 minute video he gave last year at a Google gathering. I found then that I very much admired his treatise , and likely his books, on FOOD as well.
I then went to his website (michalepollan.com) and read the introduction to two of his most recent books.
How is this meaningful to me? Simple. I was raised in the country on a farm where we grew and used just about everything we ate on the farm.
Pollan states that we have forgotten and the huge food industry has hoodwinked all of us into eating food that is not real food but just pretends to be.
Well I ate real food and as he suggests strongly it makes one very heathly. He suggests that what our grandmother recognized as real food was 'REAL FOOD' I did indeed eat what my grandmother cooked for us. Be it country cured bacon,white breans, potatoes and all other sorts of fresh and home canned vegetables.
To this I have always attributed my very good health and no need of drugs or medications..as opposed to my wife raised in a town who has had 10 or more major operations, heart stents and triple bypass heart operation and takes about $300 of prescriptions drugs per month and is six years younger than I.
So I feel that my beliefs in this area have been justified by Michael Pollan as I am exactly the type of person who consumed this type of food for most of my growing up years. And in fact currently eat in mostly exactly the same manner.
My pantry is stocked with my own homecanned vegetables. I have a wheel barrow of home grown potatoes.Lots of open pollen corn I raised. Etc and so on. My only sin is Coke. And some fine bourbon but even back then we consumed some moonshine!
Here then is much wisdom. The man has pointed out quite clearly much of the malaise that is inherent in our current culture. We have moved far beyond what is healthy for us and relied on the huge conglomerate and corporaton food industries to 'feed' us.
A return then to a more healthy and sustainable type of lifestlye will be beneficial to our health and livelhood. The sooner IMO the suburban lifestyle falls the better.
On a different but similiar note:On TOD I am aware that many of those who once posted on TOD when I was most active are no longer present with the exception of a few. (Todd,Doug Fir and others).
Many now are names I do not recognize and I wondered just why that was so. I believe that the older posters decided that the message as to our future was plain and left to go begin their own sustainable lifeboats and eschewed future postings on TOD since it can easily become a great time-sink for those who may not have the freedom of that time.
Myself I am far far along in my endeavors so I can spend a bit here as yet but I find that the newer group includes a very large number of what we called 'cornucopians'. A term I find being used very little of late here.
I suspect that many of the newer ones were once just readers and not active posters but replaced those who left off posting to do more productive work, having clearly gotten the message.
IMO maybe many came over from SlashDot or other sites when TOD became more and more visible. Perhaps being cornucopians they came to fight for their views and were mostly negative in attitudes as to the belief that the future was indeed very bleak. At least it seems to me that many express a lot of ,IMO, misplaced optimism.
Not wishing to step on too many toes but thats what I sense after several years of reading and posting on TOD.
They are welcome to their views as I am to mine HOWEVER these books and videos by Michael Pollan seem to ring very very true to me and I think he has definitely nailed it.
So I feel justified in my gardening endeavors, my desire to remain on my farm, leaving my wife and family to do as they wish, to further my desires and see it daily bear fruit as I not only prepare for the future but actually increase my longevity and health at the same time.
BTW I went to the Opthmalogist and my vision is still better than 20/20..my hometown Dr. says all my vitals are extremely good. My latest C-scan and X rays are clear.I am 70 and am still happy to chop my own firewood and get back to my blacksmithing work,soon as I find a new forge.
Airdale-eating as my grandmother would want me to
www.michaelpollan.com where you can read the intros to his several books.
Airdale, Durandal, Darwinian:
I'm a little younger (65) than y'all. I have my own little hidden 5 acres in the Ozarks. I share your sorrow of what is to come.
I'm a huge fan of Pollen. Have been following his work for nearly 10 years. I agree with about 90% of this thoughts on food and food policy. Eat real food, mostly plants, in moderation.
Yup!!!
I think it's natural for there to be a heavy turnover at online sites. Even if people don't have a lifeboat to build, they have other things to do, other interests, etc. Every site I've ever visited regularly has had a very high turnover.
Over at PeakOil.com, people often post "goodbye" messages. In some cases, yes, they are cutting back on online time to work on their peak oil hideaways or get politically active on the peak oil issue. They may even be leaving the country. Probably just as many have decided the peak oil isn't a problem after all. Or at least, not as important a problem as the financial crisis/global warming/whatever. Or they decide the site is just not for them. Too many liberals, too many conservatives, the mods are too strict, the mods aren't strict enough, nobody likes me, everybody here is stupid, LATOC is way more cool, etc. But probably most commonly, it's just real life. They've lost their jobs, lost their computers, graduated from college, have a sick child, got married, are going through a divorce, got a cancer diagnosis, or even passed away.
Leanan:
Something I observed back when leading a community Y2K preparedness group:
As we got closer to 1/1/2000, a lot of people that had been involved dropped out. I hope this meant that they were reassured by our moderate message (unlikely to be anything worse than some short-term supply chain disruptions, but still prudent to make sure one's preps are in order for this or other disasters). I also suspect that for some it was a matter of dropping out of sight and laying low, not wanting to be known as a person that actually had made preparations.
There might be something of the same phenomenon operating now.
I don't think so.
I don't think the turnover has been any higher than usual. People come and go all the time. In my personal experience (when I know the people who have left, and why), it's almost always something that has nothing to do with the larger events we post about so much. It's a personal problem unrelated to peak oil, or friction with other people at the site.
Ah yes, Y2K.
I worked very hard for the two years leading up to Y2K. Managing mainfreames and installing many programs for testing.
I remember 'blood' on the floor and angst as deadlines were passed and fear was very prevalent.
Some think we beat it. We didn't. We just put a bandaid on it.
But for now all that is moot. Moot in the extreme for we have greater problems that no bandaid can contain.
Yes I saw companies actually fail. Small ones who refused to make changes. Some that fired huge numbers of employees. Others taken over quietly.
After Y2K all the programmers , like myself, suddenly found that the companies who used them to survivce decided they were now worthless and it became extremely difficult to find more work. Then the rest went overseas to Indians versed in J2EE. A real ugly piece of junk.
So we lost many of our very best people. We don't realize that a that time the beginning of the end had just started. The board rooms realized that the time was ripe for rigging the system. In fact it had already began back around the mid 80s'. They just sped it up.
When my alma mater started unwinding and take a mighty fall I realized that what we once dreamed of was now just smoke and mirrors. Never to come back. IT was the best of times and it was the worst of times.
I was glad to have lived and toiled during the best part. We wrote golden code. That was trashed soundly by the garbage of MSFT. Now its not hardly even a memory. The rolex on my wrist remains however. Today instead of being given a rolex you get a perp walk to the door and your badge jerked off by a security guard.
My how times have changed. Worker loyalty? Hah!
Airdale-I bet my watch and warrant on it.
A week ago I returned from a week with my parents in Georgetown, KY. The home farmstead has been cut into two by a bypass highway and one ends faces a sprawl subdivision. My father sold a plot for a new high school to the school board.
The larger farm is still 5 or so miles from development.
I helped take down and clean the garden for the winter (some lettuce, turnips, parsnips left). I was struck by the care my father takes to keep viruses and other plant diseases, especially tomato viruses, from spreading.
After 3 years, he is shifting his garden over (he never plants the same crop on the same spot year on year). He gathers the tomato etc. stakes up and leaves them in the sun and rain for a couple of months (after stripping off all tendrils and string). He then stores them for a year while using his "odd year" (2009) set this coming spring.
After many years, I have a clue as to what is required to properly plant, grow and then clear a garden, but it has never attracted me.
My mother is too feeble to cook anymore, so they hire someone to come in and cook "good country cooking" almost every night. Both my parents have gained weight on this diet and I developed my first ever case of gout (OUCH !) while there. A change in diet and some dehydration from working in the garden.
Alan
airdale:
Yep, Pollan has written a couple of good books.
I would be gardening and fixing all of our meals at home, almost entirely from scratch with whole foods, even if everything was going up, up and away into cornucopian nirvana. That is my lifestyle, and I believe that my quality of life is better for it.
The processed, packaged junk that they sell in the "center aisles" of the supermarkets never ceases to amaze me. Having become habituated to a diet of "real food", I'm not sure I could even stand to eat that stuff were it placed in front of me, even if I were hungry. A lot of it really is quite unpalatable - I can't imagine how people can subsist on that stuff day after day.
What a great idea!
Saving US Auto Manufacturing
http://blog.tomevslin.com/2008/11/saving-us-auto.html
One could list a hundred things the USA government should be doing-none of it means anything. The new puppet is coming in and he is very careful not to do the slightest thing to upset basically the same grifters that control the current puppet. OTOH it isn't a bad idea-eventually it will probably happen (in China).
Hello TODers,
From a fast google search of grains and I-NPK topics:
http://www.contrarianprofits.com/articles/sue-the-fed-dubai-in-trouble-c...
--------------------
“The credit crisis is even affecting the world’s ability to produce food,” warns Chris Mayer.
“It’s harder for farmers to get credit for next season’s crop, especially farmers overseas. They need fertilizer, seed, fuel and more. The net effect might be lower planting of key grains even as world inventories of these grains hover near historic lows. Bloomberg reports that global inventories of corn, wheat and soybeans are the second lowest they’ve ever been since 1974.
“All the while, the credit crisis threatens next year’s crop in many critical grain-growing regions. In Russia, for example, cash-starved banks have cut off funding for the industry. The head of the Russian Grain Union says, ‘Many farmers probably won’t be able to borrow money for the spring sowing.’ This is important because Russia is no lightweight in the grain division. It produces 9% of the world’s wheat, for instance.
“Even if demand growth for grains slows, it’s not likely that those low global grain inventories will improve. PotashCorp CEO William Doyle presented the nearby chart (‘Tight Grain Markets’), which might seem a little busy, but I think it shows you how much of a hole the grain markets are in. For instance, the five-year average growth rate in grain demand is 2.6% per year. Even if grain demand fell to 2% per year, we’d still need record production to keep grain inventories from falling further.
---------------------
http://www.istockanalyst.com/article/viewarticle+articleid_2792125.html
----------------------
Global Markets: The Planting Season and the Credit Crunch
A wave of planting is set to take place in the southern hemisphere within the next few months. The planting season is a very capital-intensive period in the crop cycle, and farmers frequently rely on financing to obtain necessities like seed and fertilizer. But lowered profitability and restricted access to credit threaten to suppress planting activity this season.
Cotton and soybeans in Argentina and Brazil, sorghum in Australia, corn in South Africa and wheat in Mexico could all be in danger as low profitability and restricted access to credit make full plantings a tenuous prospect.
The breadbaskets of Brazil and Argentina, two of the world’s largest producers of an array of agricultural commodities, already face serious trouble as both have seen lenders shy away from the agricultural sector. Funding shortfalls have led to reductions in both fertilizer and equipment purchases, and industry insiders have speculated that 2009 production could suffer as a result.
Subject to a perfect storm of bad conditions, Australia has been especially hard hit by the credit crunch. The country’s ailing agriculture industry, already in the grip of a multiyear drought, has sustained the additional setbacks of reduced profitability and worsening credit conditions. Financial damage to the sector is extensive enough to engender fear of widespread bankruptcies. One estimate puts the number of potential farm bankruptcies in South Australia at around 25 percent by 2009.
Ultimately, the damage sustained by farmers due to the credit crunch will not stop there. If current trends continue to play out, the 2008-2009 season could see markedly reduced yields — a development that would set the stage for another round of price surges.
----------------------------
http://www.mineweb.com/mineweb/view/mineweb/en/page504?oid=72881&sn=Detail
------------------------
Uralkali shares fall by over 70%
A renewed probe of a two-year-old accident at potash miner Uralkali has landed a fresh blow on fragile confidence in Russian stocks and raised fears of a state asset grab, analysts and fund managers said on Tuesday.
Investors fear that influential figures near the top of the government, widely suspected of expansionist ambitions in the natural resources sector, have also noticed the fat profit margins that have made Uralkali a darling of fund managers.
Weafer said the Uralkali investigation would pit a group of politicians keen to see more state control of natural resources against Kremlin liberals, and that investors wanted to see President Dmitry Medvedev take sides.
"We are at an important point, not just for Uralkali, but for the investment climate overall," Weafer said. "If this asset grab is successful, it will be seen as a victory for the statists and a defeat for the liberal agenda."
----------------------------
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Hello TODers,
Consider the irony: every breath of fresh air we take may doom a starving Third Worlder to take his last breath...
Could the new urea requirements for diesel trucks, construction rigs, and diesel cars, gradually price even more poor subsistence farmers out of this vital Nitrogen topsoil product?
http://www.eurekalert.org/pub_releases/2008-11/i-uto111008.php
---------------------
Urea tanks on diesel trucks -- that's the law in the United States starting in 2010
Automotive grade of world's most widely used nitrogen fertilizer used to meet new US environmental regulations to cut air pollution
Urea tanks will be standard equipment for most new diesel trucks, buses, cars, and sport utility vehicles (SUVs) manufactured in the United States after Jan. 1, 2010. An automotive grade of urea will be injected into the vehicles' exhaust stream to "scrub" nitrogen oxide (NOx) from the diesel exhaust.
"We know about diversion of traditional food crops such as corn or sugarcane to biofuels like ethanol—but now urea, a basic input for food production, is also going into fuel," says Dr. Amit Roy, President and CEO of the International Center for Soil Fertility and Agricultural Development (IFDC).
------------------------------------
It will be fascinating to see how much this new demand will affect marginal urea pricing upward as we go postPeak.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Yes,,,I recently drove an older tractor(semi) up to the dealer to get some DTCs(diagnostic codes) pulled on it. (I have since brought my own tech tool on Ebay to do the same and not have to go to the dealer to set or adjust the ECU--engine control unit).
While there one of the mechanics told me some very hard to believe stories about what new trucks require and what they are going to be required by the EPA regs to do.
One is replace a certain part of the exhaust system on a timely basis. That part will cost thousands of dollars he said. Also they have to shove certain types of pellets into the exhaust. I suppose what you are referring to.
I simply found this astounding. I maintain the electronics on grain trucks used on the farms. I also diagnose and repair the electronics in combines and planters and other equipkment.
Recently some very bad complaints were made that I was in effect stealing the dealers profits (on this and in other areas I work in) by not allowing them to get the work of repairs and parts. They were really angry and the backwash came down.
So much so that the next time I went to buy a sensor they made me wait and hour and then flagrantly gave me the wrong part. A hundred mile trip wasted and equipment down as a result , right during harvest.
Now this company who makes these trucks has been brought out by another firm and parts are going to become very difficult to obtain, so it is said.
Why is American businesses being so frigging stupid? This is just hastening the end IMO. This is clearly increasing cost to the farmers since it appears they see a golden egg to fry in the offing and don't really care. Why am I not suprised that all this is happening in AG now as it has in all the other enterprise areas?
Why have we become our own enemies? Now in the area of food. This is a recipe for diaster. The seed companies appear to be leading the charge and the ag chemical people right behind them.
The farmers I hear who post on the net are not happy about it but seem to be caught in market plays continually.
The report did not say that there were no reserves, just that they would cost $200/barrel to get. Saudi Arabia is saying they can't invest in new production at under $60/barrel. So, they must have run through all the good stuff already and are now having to develop their marginal stuff.
I think we are better off just using the good stuff and not supporting further investment oil.
Chris