Drumbeat: March 21, 2010

Energy minister will hold summit to calm rising fears over peak oil

Lord Hunt, the energy minister, is to meet industrialists in London tomorrow in a bid to calm mounting fears about the disruption that could follow a sudden shortage of oil supplies.

In a significant policy shift, the government has agreed to undertake more work on whether the UK needs to take action to avoid the massive dislocation that could be caused by the early onset of "peak oil" – the point that marks the start of terminal decline in global oil production.

Jeremy Leggett, the executive chairman of the renewable power company Solar Century and a leading figure in the UK industry taskforce on peak oil and energy security, said the meeting, to be held at the Energy Institute, showed a welcome new sense of urgency.

"Government has gone from the BP position – '40 years of supply left, the price mechanism works, no need to worry' – to 'crikey'," he said. "BP and others are telling us that, but you lot, Virgin, Scottish and Southern, and others are telling us something completely different. We do not know who to believe. Let's do a proper risk assessment with industry," he said.

Venezuela punishes 80 firms for power use

CARACAS (Reuters) - Venezuela announced on Sunday 24-hour power cutoffs for 80 firms that have failed to reduce electricity usage in the first punitive measures of a nationwide drive to save energy amid an electricity crisis.

Restaurants, liquor stores, hotels, gyms, car dealerships and a yacht club were on the list of companies in the capital Caracas that would have their power cut on Monday for failing to bring consumption down 20 percent, the state utility said.

The local unit of Japanese firm Sony Corp will be among those sanctioned.

OPEC Output Ceiling Reached

VIENNA — OPEC has less room to raise production as global oil use recovers because of Russia's increasing output, said Shokri Ghanem, head of Libya's delegation to the organization.

Mexico closes Dos Bocas oil port on bad weather

MEXICO CITY (Reuters) - Mexico closed its Dos Bocas oil port in the Gulf of Mexico on Sunday due to bad weather, the government said.

RIL goes back to ONGC for Venezuelan oil block

NEW DELHI: After the $14.5-billion LyondellBasell takeover deal turned sour, Reliance Industries (RIL) has renewed talks with the ONGC-led consortium to pick up a stake in the Carabobo-1 oil block in Venezuela, a consortium member told ET.

Gas prices expected to flatten

ATLANTA (CNN) -- Prices at the pump are up nearly 9 cents in the past two weeks and a total of 18 cents in the past month, but the increase is likely to slow, according to a survey published Sunday.

Institutional investors start to worry about challenges facing oil companies

WITH the current state of the oil and equity markets, it may seem premature to think that the petroleum industry is about to hit the wall, whatever your opinion of peak oil and climate change.

But institutional investors from the US, Europe and Australia worth a combined $US12.5 trillion ($13.6 trillion) are sufficiently concerned about the significant challenges and potential threats to oil industry valuations that they are demanding greater disclosure on how these companies propose to manage the inevitable transformation to a low-carbon economy and the likely shift away from their end products.

Kurt Cobb: Perry Mason and the climate change deniers

Perhaps the best but certainly not the earliest example of the perpetual underdog defense attorney is Perry Mason, the main character of the eponymous television drama. Mason's fictional clients almost uniformly have the means, the motive and the opportunity to commit murder. And just as uniformly, Mason would unmask the real killer, often through clever cross-examination that exonerated his client. Combine this with the number of times television audiences have heard television judges explain to television juries that in order to convict they must find a defendant guilty beyond a reasonable doubt, and you get a public primed to accept that any doubt is sufficient for acquittal.

The fossil fuel lobby has used this persistent and decades-long instruction to good effect. Most fossil fuel industry propagandists no longer claim there is no climate change since this position has become untenable in the face of overwhelming evidence. Instead, like Mason they point the finger at so-called "natural" warming as the true murderer of climate stability. They do not present any evidence of their own because they have none. (All their money is spent on propaganda.) They merely cite research from bona fide climate scientists which documents previous periods of climate change unrelated to human activity. This, of course, proves nothing.

Can Russia be trusted with our uranium?

A 2005 survey of 1200 Australians found that 56% of us believe that the International Atomic Energy Agency's nuclear 'safeguards' system is ineffective.

Barely half as many believe the system is effective.

South Korea’s Global Nuclear Ambitions

Given the increasing concerns over global warming and peak oil theory, nuclear power has been championed as a clean and sustainable alternative for producing electricity. Nuclear power does indeed emit comparatively low levels of carbon dioxide, and can generate a large amount of electricity from a single plant. Nevertheless, the drawbacks are many. Notably, nuclear waste is so hazardous that it has to be carefully managed for several thousand years. The environmental consequences of accidents or attacks can be catastrophic, as seen from the Chernobyl disaster of 1986, and it is a relatively easy step to move from peaceful power generation to weapons development. Moreover, nuclear energy is itself derived from uranium, a finite resource albeit one which the IAEA expects to last for at least 80 more years even without new discoveries in technologies or deposits.

This paper assesses the development of the Korean nuclear power industry. It then shows why its clients in the Middle East want to harness nuclear energy and why they have chosen South Korea to lead this process rather than more experienced exporters such as France or the US-Japanese consortium. Finally, the article concludes with a brief outline of South Korea’s global nuclear export strategy and a wider discussion of economic ties between South Korea and the UAE.

Academic Paper in China Sets Off Alarms in U.S.

It came as a surprise this month to Wang Jianwei, a graduate engineering student in Liaoning, China, that he had been described as a potential cyberwarrior before the United States Congress.

Larry M. Wortzel, a military strategist and China specialist, told the House Foreign Affairs Committee on March 10 that it should be concerned because “Chinese researchers at the Institute of Systems Engineering of Dalian University of Technology published a paper on how to attack a small U.S. power grid sub-network in a way that would cause a cascading failure of the entire U.S.”

Aluminium producer Alcoa waiting for enough gas to revive expansion plans

AUSTRALIA is attracting more than $US130 billion ($142bn) worth of investment in some of the world's richest natural gas fields to supply buyers in Japan and China.

But it seems domestic customers, particularly in Western Australia, will have to wait.

Aluminium producer Alcoa, for one, is waiting for enough gas to revive its expansion plans.

The Philippines: Order freeze of oil prices anew

LAKAS-Kampi-CMD Rep. Mikey Arroyo of Pampanga is asking President Arroyo to order the freeze of prices of oil products similar to the executive order (EO) she issued last year when Typhoons Ondoy and Pepeng devastated large parts of the country.

The President’s son said, “[In light of] the threat of a weekly oil-price hike looming right before our eyes amid the worst El Niño phenomenon to hit the country in years, a presidential order on the freeze of oil-product prices might be in order.”

The Philippines: Energy Exec warns: Be ready to pay 3X for your electricity

If Malacañang´s quick fix solution for the power crisis in Mindanao pushes through, consumers could pay as much as three times what they´re now paying for electricity.

Indian Oil May Raise Gulfsands Bid After Rejection, FT Reports

(Bloomberg) -- Indian Oil Corp. may increase its bid for Gulfsands Petroleum Plc after the London-based company yesterday rejected the unsolicited takeover offer, the Financial Times reported, citing unnamed people.

Aramco named energy company of the year

DAMMAM: Saudi Aramco has been named Energy Company of the Year for its commitment to a cleaner environment, its investment in bringing new energy streams online and its long-range vision promoting reliable supply for the future.

Now in their 23rd year, the awards are made by Hart Energy Publishing and will be presented on March 24 in Phoenix, Arizona.

Books offer insight into powerful world of energy

Climate change, energy crisis and eating locally are just a few of the terms that crop up on a regular basis in our media and everyday conversations. There's no dearth of books on greening our lives, and here a few of the most recent and most informative.

Stuart Staniford: The net energy of pre-industrial agriculture

It's also clear that modern biofuel EROEI's are in the same range as pre-industrial agriculture, and therefore are completely unsuited to support an industrial civilization.

Talk Deeply, Be Happy?

Would you be happier if you spent more time discussing the state of the world and the meaning of life — and less time talking about the weather?

It may sound counterintuitive, but people who spend more of their day having deep discussions and less time engaging in small talk seem to be happier, said Matthias Mehl, a psychologist at the University of Arizona who published a study on the subject.

Are US Marines Expendable?

Deploying US Marines in uninhabited desolate terrain in Afghanistan to secure an area where oil pipelines get built may be considered crucial to the national security of the United States.

After all, oil is vital to keep our cars running, our airplanes flying, our homes heated and our tanks, ships, helicopters and other military vehicles operating. But what remains inexcusable are plans to bivouac more than 3,000 US Marines in a single compound in hostile territory.

Is Petronas on the right track?

Many nations blessed with rich resources have enjoyed economic booms, but many have also been cursed by it. So what is Malaysia’s standing among the world matrix of oil-producing nations, and how well are we managing our oil revenue?

Cyclone knocks out power to 55,000

Helicopters are checking the condition of power lines in north Queensland as 55,000 homes and businesses remain without power, Ergon Energy says.

Cyclone Ului caused extensive damage to power infrastructure when it crossed the coast near Airlie Beach in the Whitsundays early today, packing winds of 200km/h and washing a dozen boats onto the rocks.

Ports still closed in wake of cyclone Ului

Coal terminals in north Queensland remain closed after ex-Tropical Cyclone Ului dumped more than 350 millimetres of rain on the region.

North Queensland Bulk Ports staff are inspecting the Dalrymple Bay terminal, south of Mackay, and the Abbot Point terminal near Bowen, south of Townsville, but no major damage has been reported.

Gas The Next Fuel To Fire Australia's Boom

KARRATHA, Australia -- First gold, then coal and iron ore. Now, a new bonanza is about to be unleashed from beneath Down Under: Australia's got gas.

Projects being ramped up to tap huge undersea fields off the country's northwest could quadruple Australia's exports of liquefied natural gas in the next few years and turn it into what the country's resources minister has called an "energy superpower."

In rural north-central Pa., hope for more jobs from natural gas

COUDERSPORT — The economy in rural north-central Pennsylvania has ebbed and flowed with the region's natural resources.

Lumber once made people rich in a part of the state so desolate it's been nicknamed "God's Country." A little further west, the oil boom that began more than 150 years ago brought some prosperity.

Now a rush on natural gas stored deep underground in the sprawling Marcellus Shale formation has brought hope of more jobs that could help the economy in a region with some of the highest unemployment rates in Pennsylvania.

Oil India, Indian Oil Said to Have Made Gulfsands Rejected Bid

(Bloomberg) -- Oil India Ltd. and Indian Oil Corp. jointly made the bid for Gulfsands Petroleum Plc that the U.K. company with assets in Syria and the Gulf of Mexico rejected last week, three people familiar with the matter said.

The unsolicited approach was “wholly inadequate,” Gulfsands said March 19, without giving details. The bid was at 350 pence a share, the Financial Times reported yesterday, or 10 percent above the March 19 closing price. That would value the London-based company at about 400 million pounds ($601 million), the newspaper said. The offer may be increased, it said.

Kuwait to conduct 'oil lake' treatment forum

KUWAIT: A scientific forum is to be held here between March 22 and 25 on reviewing the latest techniques in treating and containing Kuwait's 'oil lakes' and rehabilitating war-ravaged environments generally. The forthcoming event was announced on Friday by Khalid Al-Mudhaf, the head of Kuwait's Central Committee on War-Damaged Environment Rehabilitation Projects, who revealed that the event will be held under the sponsorship of Minister of Oil and of Information Sheikh Ahmad Abdullah Al-Sabah.

How green are railways?

There is a general view that railways are green whilst all other modes of engine powered travel are not. This is a strange view. Trains need diesel or electric engines to pull them, which in their turn generate emissions including CO2. If we wish to see how much more efficient railways are than cars, buses, coaches, ships, planes and other powered transport, we need to do a proper audit. The figures which result show it all depends. It all depends how the electricity was generated and hwo the double inefficiency of the power station and the electric engine works out. It all depends how new or old the train is, how efficient it is and how many people are on it.

Australian cities need radical changes

AUSTRALIA circa 2050: population 35 million, climate change-induced rising sea levels have flooded the Gold Coast region, apartment blocks are used to grow food and people commute in monorail pods above the sea.

In another city, Australians live on floating island pods with apartments both below and above sea level, the population has shifted from land to the sea because of the sky-rocketing value of disappearing arable land. Climate change has also forced many Australians to move inland and create new cities in the outback, relying on solar power to exist in the inhospitable interior.

These are just a few urban scenarios by some of Australia's leading architects shortlisted for "Ideas for Australian Cities 2050-plus" to be staged at this year's Venice Architecture Biennale.

Sea view

But as well as being a potential cause of devastation, Rayner believes the ocean could also provide a solution to climate change and an impending peak-oil situation. ’The UK doesn’t have many resources left to exploit in terms of hydropower from rivers; it’s not a great place for solar; and there are lots of issues with onshore wind,’ he said. ’The decision to adopt offshore wind to hitting that target is a pretty sound one. But if you think about the scale of these things, each one is as big as the London Eye, so there are some big engineering challenges to delivering that.’

Transition Bloomington helps neighborhoods re-imagine themselves

Imagine that you're driving a car across the vast spaces of an enormous desert, and your gas tank is exactly half empty. This is the perfect time to consider your options for continuing onward or finding shelter; you wouldn't want to wait until the tank is nearly empty.

This is the situation the world faces with peak oil: half of all the world's petroleum reserves have been used up. The U.S. Department of Energy's 2005 Hirsch Report noted that peak oil will pose enormous challenges to our economy and lifestyle, and that mitigation efforts will be necessary to ease the transition to a world characterized by scarce oil.

Stewart L. Udall, 90, Conservationist in Kennedy and Johnson Cabinets, Dies

Stewart L. Udall, an ardent conservationist and a son of the West, who as interior secretary in the 1960s presided over vast increases in national park holdings and the public domain, died on Saturday at his home in Santa Fe, N.M. The last surviving member of the original Kennedy cabinet, he was 90.

Renewed Support for an Everglades Land Deal, but Cost Is Still in Question

MIAMI — Gov. Charlie Crist reaffirmed his commitment this week to the $536 million purchase of 73,000 acres of land from United States Sugar, declaring that it would heal both the Everglades and the coastal estuaries that are vital to Florida’s tourist economy.

But with its original plan to borrow money for the deal being questioned by internal auditors, the state water district responsible for the acquisition has begun to explore alternatives that could require severe cuts to restoration projects already in motion — and the sale of a reservoir — or a renegotiated, smaller purchase.

California Tribe Hopes to Woo Salmon Home

SAN FRANCISCO — On Friday night, more than two dozen Native Americans embarked from here on a spiritual mission to New Zealand, where they will ask their fish to come home to California.

The unusual journey centers on an apology, to be relayed to the fish on the banks of the Rakaia River through a ceremonial dance that tribal leaders say has not been performed in more than 60 years.

Life below the melting Himalayan glaciers

In a land steeped in Buddhist tradition, the people of the Tibetan Plateau look at the effects of climate change through a different prism than is currently being used in America. Whereas in America, climate and energy legislation is being held hostage until lawmakers can figure out a way to preserve our materialistic culture, in Tibet, the idea that nothing will get better until we get rid of our materialistic culture permeates.

Reports of inaccuracies surrounding the melting of Himalayan glaciers by 2035 in an IPCC report on climate change caused an uproar in the ranks of the opposition to energy reform in the United States where, within certain ranks, the entire field of climate science was relegated to junk status; but the realities of climate change look quite different on the physical plane than they do in the cognitive one.

Top climate officials urge progress at Mexico summit

CANCUN, Mexico (AFP) – The Intergovernmental Panel on Climate Change has listened to and learned from recent criticism, but the threat of global warming is real and must be tackled, the group's head said Saturday.

Deploying US Marines in uninhabited desolate terrain in Afghanistan to secure an area where oil pipelines get built may be considered crucial to the national security of the United States.

How much oil do they have? Just think about the location or look at google maps is there any or any need for any pipelines in the country to transport oil to US?

crucial to the national security

It might be a good hideout but how many could afford to travel to US? or withing shooting range? Afghanistan is a small poor country located almost as far away as possible from US and they armed mostly with old hand arms.

How much oil do they have?

afganiatan may have a relatively small amount of oil and gas resources, but any pl route would also be crucial for land locked turkmenistan,uzbekistan,krygzistan and tajikistan.

Deploying US Marines in uninhabited desolate terrain in Afghanistan to secure an area where oil pipelines get built may be considered crucial to the national security of the United States.

probably not crucial to the national security of the us, but crucial to the financial security of xom, cvx and bp to name a few.

How much oil do they have?

It is not about any oil they may have at all.

The obvious question then is why? Gagnon once more: The proposed pipeline route is to move Caspian Sea oil through Turkmenistan into Afghanistan and then finally through Pakistan to ports along the Arabian Sea where US and British tankers would gorge themselves with the black gold.

The game being played out today is for control of who controls the flow of oil. ‘’The whole reason the US is in Afghanistan and Pakistan today is to deny those pipelines from being routed through Russia, China, or Iran,’’ says Gagnon. When you look at the map where the US Marines are operating inside Afghanistan it is in areas, says the writer of the article, that must be controlled if pipelines are to be built and safely exploited.

That last paragraph is a total load of donkey doo. This guy Gagnon must be some kind of fool. Anyway it is extremely unlikely that any kind of pipeline will built through Afghanistan, not until peace breaks out anyway. Fat chance of that ever happening. They have been fighting a civil war there for hundreds of years.

Ron P.

Your last sentence is a total load of donkey dumplings. The civil war is three decades old. The history of palace coups, foreign invasions, periods of stability, and so on which characterize the previous centuries do not constitute civil war.

People in glass houses shouldn't throw out epithets.

Toil, it would be nice if you could respond to my post without making it into a personal attack. We have had people who constantly did that in the past. It appears we now have a new replacement for River. However:

History of Afghanistan

In 1525 Babur, a descendant of Timur, rose to power and made Kabul the capital of his Moghul Empire. Timur handed over his kingdom to Babur during a ceremony. From the 16th century to the early 1700s Afghanistan was divided in to three major parts. The north was recognized as the Kingdom of Balk, which was ruled by Uzbeks Khans, the west was under Persian Safavid rule and the east belonged to the Mughals. There was constant war fought over the region Kandahar, in some occasions it was taken over by the Mughals but most of the time it was ruled by the Persians.

There has been constant war in Afghanistan, most of the time it was with different sections of what is now one country. Sometimes it was with neighbors. And sometimes it was with the British. But it was always war... for centuries.

Warmest regards,

Ron P.

You were claiming that civil war has been a fact of life in Afghanistan for centuries, which is not the case. Taking my response, that your claim amounts to donkey dumplings, as a personal attack is simply wrong. A reference to the rivalry between Mughals and Persians for Kandahar does not change the picture.

You unhesitatingly called Gagnon a fool. Doing so suggests, whether intended or not by you, that anyone who sees merit in his argument is also foolish.

Personally, I will not be surprised to learn that the reasons the Cheney dominated administration started the war in 2001 included considerations about the flow of hydrocarbons from the region, and among these considerations was one dealing with access to the resources in the 'stans'. Gagnon is perhaps wrong in emphasis.

By the way, I think you'll appreciate this articulation of a collapse scenario by Chris Hedges: http://www.informationclearinghouse.info/article25022.htm


You unhesitatingly called Gagnon a fool. Doing so suggests, whether intended or not by you, that anyone who sees merit in his argument is also foolish.

Yes I did. Gagnon is not a poster on this list; he is a blogger and writer of foolish articles. The Afghan war was all about 9/11 and the attempt to stop the Taliban from further terrorist attacks. Only a fool would say it was all about a some future pipeline that might or might not be built.

There are many fools blogging on the internet. In my opinion I would say anyone who says oil comes from deep in the earth is a fool. Also there are many other claims that would, in my opinion, mark them as a fool. But if such a person chose to have an exchange with me personally, on the net, then I would be more kind. I would probably only say that they were foolish. ;-)

By the way, I think I can see where you are going with this. I think you are saying Cheney and Co. had the pipeline in mind when they were planning....

I am not going there. End of discussion.

Ron P.

Cheney et al did commit the first act of war with Afghanistan. Bin Laden, or his pals, committed a serious escalation in the long series of strikes between a small faction of Islamists and the US and its allies. If I remember correctly one of those strikes involved a missile attack on a Al Quaeda training camp during the Clinton Administration. Clinton had good reason to hit Al Quaeda given previous attacks from various of its cells on American and allied lives and property.

Clinton differentiated the Afghanee people and their Taliban government from the gang of foreigners learning bombmaking etc.. Clinton violated Afghanistan's sovereignity, but did not attack the state or its apparatus.

The war in Afghanistan began when the US leadership rallied sufficient political cover internationally, shamelessly exploiting the sympathy the country had gained in the wake of the tragic success of the 11th September strikes, to execute a plan to overthrow the Taliban government. The Taliban and Al Quaeda were embroidered into one cloth in a now familiar 'public relations' campaign. Of course, now we are learning that even the Taliban is many clothes, some of which the US generals want to persuadeo to change sides, diplomatically.

I don't think that the flow of hydrocarbons was the only issue influencing the policy process within the Bush-Cheney regime regarding Afghanistan and the Taliban, but there is good reason to believe that it was a very significant issue, especially as both men were evidently aware by 2001 of the emerging constraint in oil supply.

Darwinian chooses to live in a black or white world on this issue... The Afghan War was about 9/11! It wasn't about a pipeline for oil!

Right, but what was 9/11 about? Why do we keep military bases in the Middle East? Why did we go to war with Iraq (2 times)? Why are we still at war in Afghanistan for 8 years running?

Unfortunately it happens to be the case that the area of the world with much of the world's remaining hydrocarbons is also populated with militant religious extremists who have a variety of long standing complaints against the U.S. and the West in general. Add Israel and the significant influence of Jews in the upper echelons of politics/finance in the U.S. into the mix, as well as the fact that the world's biggest consumer of oil also has the world's most powerful military (and the only one capable of global projection), and you've got a situation too complicated to reduce to one size fits all explanations for the events that go on there.

In short, Darwinian is as guilty of simplistic thinking as the individuals whom he claims to be "fools."

Why were most of the 9/11 bombers Saudis?

The Afghan war was all about 9/11 and the attempt to stop the Taliban from further terrorist attacks. Only a fool would say it was all about a some future pipeline that might or might not be built.

This is sandpit level - and foolish. Only a child calls everyone who has a different opinion to them a fool. Time to grow up a little, I suggest.

I think it is absolutely clear to anyone who really wishes to see, that the main reason (and in reality, the sole reason) the US has the slightest (military) interest in Afghanistan - and is apparently willing to sacrifice a lot in the process - is to secure Central Asian oil&gas advantages, and to counter Russian, Chinese, and Iranian influence over those same energy resources. This includes plans for a pipeline to Pakistan, through real estate that is secured and controlled by US interests.

It has nothing to do with chasing Bin Laden and his Taliban cronies into a cave ... that is laughable, and I am surprised anyone actually still states that without an ironic grin and a roll of the eyes. I take the point that it is complicated by lots of other Middle Eastern factors, but that does not detract from the ultimate cause of the American invasion of Afghanistan.

Cargill is in the money and close to the bullseye folks.

Afghanistan is sort of like Poland in one critical respect-the country is located in such a place and such a way that it is the key to military and therefore economic control of the entire region.

Mac, I am not surprised that Cargill, Toil, and Oilman believe Afghanistan was all about oil, planned and delivered by Cheney even before the attack, but I am a little shocked at you. I simply thought you were a cut above that crowd. Guess I was wrong.

It is doubtful that any American Diplomat ever believed that there could be peace in Afghanistan. To believe that a pipeline could be secured without a line of soldiers, shoulder to shoulder, defending it requires a total ignorance of history.

However I will drop it here. I never argue with conspiracy theorists. Ockham’s razor is not in their encyclopedia. Any Rube Goldberg scenario that supports their theory is regarded as gospel no matter how many complicated layers of conspiracy must be piled upon each other. I had sooner try to convert a Hard-shell Baptist to Catholicism.

Ron P.

I never argue with conspiracy theorists.

Good thing! I was about to bring up Iran in '53, the Tonkin Gulf incident, Iran/Contra, those Republicans caught rigging the vote in Ohio... the fact we have not invaded NK to save all those lives...

But since conspiracies don't exist, I guess I won't.


But since conspiracies don't exist, I guess I won't.

What a silly thing to say. Of course conspiracies exist. However Grand Conspiracies that require the secret to be held by hundreds, even thousands of people, do not exist. Especially those that have hundreds of people, from the President on down, committing cold blooded murder of thousands of people, and if even one of them let the cat out of the bag they would all be shot.

I am waiting for that one confession: I did it, I am one of four hundred engineers that planted explosives in the World Trade center on orders from Cheney. I am sorry I helped kill so many people but we had to find an excuse attack Afghanistan because we must build a pipeline there by 2020.


Grand conspiracy theorist, are a little comical. Their Rube Goldberg schemes that require many levels of conspiracy, by hundreds of people, are laughable. But as someone posted on another thread, sometimes even very bright people can hold very silly ideas.

Ron P.

What the heck are you on about? Did I say anything about 9/11? I was referring to the Iraq invasion being about oil. Which it indisputably was.

Afghanistan was the more legit of the two, though the pipeline would have been important in terms of securing FF supplies in the region, too.

- Secret oil meetings
- Iraqi oil on the agenda by day 11 of BuCheney administration
- Stated 95% certainty of no WMDs by IAEA (what sane president starts a war with a 95% certainty of being WRONG?)
- Request by IAEA for only 90 days to finish inspections refused in favor of WAR
- Secret oil meetings + recent announcements of KSA-like reserves in Iraq
- Cheney knowing about decline rates as stated in 1999

- Other reasons for going into Iraq? ZERO.
- Evidence for same? Zero.

You're a smart guy, but concluding Iraq wasn't about oil is like concluding Christmas isn't about presents (for most people). Same goes for Afghanistan, though, again, it had the legit cover of going after Al Queda.

As for the conspiracy, you do realize the president doesn't have to inform his generals of his reasons, right? Need to know basis. Only a handful of people needed to be in on it. While it was not limited to just Cheney and Bush, because of the military nature of the thing, it could have been and succeeded just fine.

Who else would *need* to know to do their jobs? Nobody.


Mac, I am not surprised that Cargill, Toil, and Oilman believe Afghanistan was all about oil, planned and delivered by Cheney even before the attack, but I am a little shocked at you. I simply thought you were a cut above that crowd. Guess I was wrong.

I don't wish to continue a slanging match, since it is unseemly - however a few astonishing things appear in this statement.

You know almost nothing about me - my reading, education, experience, political background, career achievements ... almost nothing. How on earth you can lump me into a predictable "crowd" - amazing. And how can you claim your version or interpretation of events is absolutely right, while alternative views are conspiracy theories? How do you know - because your government told you so? Really?

People who lash out angrily at alternative views to their own generally share a common characteristic. They are hearing things they don't wish to hear, because they know deep-down that they are right, but just want them to go away. Shorthand label for this is denial. Have a great day.

Cargill, your insulting post painted, I thought, a clear enough picture of you.

This is sandpit level - and foolish. Only a child calls everyone who has a different opinion to them a fool. Time to grow up a little, I suggest.

As Leanan's link below stated, Clinton was also considering going after al-Qaida. I suppose he was a child, or had the mind of a child, to think al-Qaida might be a threat. Or was this all part of a grand conspiracy scheme, that started during the Clinton Administration, to secure Afghanistan for their oil, or for some possible pipeline twenty years down the road?

Time to grow up a little, I suggest.

Ron P.

Time to grow up a little, I suggest. You're just embarrassing yourself.

Right, I make an argument and you return, not with a counter argument but with only an insult.

I had you pegged correctly.

Ron P.

I don't think we can put the blame on Cheney. The Clinton administration was preparing to attack Afghanistan before 9/11. They held off when it became clear that Gore might lose, because it's considered unseemly to start a war and leave the other party to finish it.

Of course you cannot put the blame o Cheney; he had nothing to do with it.

The article you posted said Clinton was considering going after al-Qaida, it said absolutely nothing about oil. I suppose Clinton thought al-Qaida might try a terrorist attack, do you reckon?

Yes Leanan, the Clinton plan, if they ever had one, was about al-Qaida, not oil. Thanks for the link.

Ron P.

I don't think it's too far-fetched to assume the oil entered into the calculation as well. Back then, there really was a lot of hope that the Caspian Sea would be the motherload. It turned out to be a bust, of course.

I don't think it's too far-fetched to assume the oil entered into the calculation as well.

Yes, and nothing about conspiracy held secret:

Greenspan's remarks, appearing first in his just-published memoirs, are eyebrow-raising for their directness:

"Whatever their publicized angst over Saddam Hussein's 'weapons of mass destruction,' American and British authorities were also concerned about violence in the area that harbors a resource indispensable for the functioning of the world economy. I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil."

What holds for Iraq can be true for the whole region: trying to stabilize it.

From what I can remember reading, Cheney was desperate to attack Iraq at the time. He was quite disappointed that Hussein had nothing to do with 9/11 and had to spend time being distracted in Afghanistan.

The invasion of Afghanistan was done on the cheap. If the neocons really wanted the country they would have done it properly and saved themselves 8 years and counting of bloody insurgency. (However, the prospect of the neocons ever doing properly now seems faintly ridiculous).

It was done on the cheap because they didn't think any more was necessary.

Indeed, that was a big element of the neocon plan for Iraq as well as Afghanistan. They did not want to get into any difficult wars. They targeted what they thought were "low-hanging fruit" - countries that that would provide easy victories, that would cure the American people of the memory of Vietnam.

Remember the controversy when Dubya was still in office? Rummy was insisting that we could conquer the world with a smaller, lighter, cheaper military.

The Afghan war was all about 9/11 and the attempt to stop the Taliban from further terrorist attacks.

All? No other possible motive? So the flow of drugs and therefore the money from drugs are not a factor?

Considering 'the terrorists' were in bulk tied to the KSA - exactly how did you come to your above conclusion about "all" and "stop the Taliban"?

Only a fool would say it was all about

Oh. Sorry I didn't catch your post as satire. Well played Ron.

Eric, perhaps my use of the word "all" was a little over the top. America demanded revenge and they demanded that America "do something"? That was as much a motive as the Taliban. However, to use your terminology; Only a fool would say it was all about oil!

And that was not satire.

Ron P.

Thanks for the Chris Hedges article, Toil. Spouse and I appreciated it. He writes like a later Old Testament prophet, Amos maybe.

I can see why you are reminded of Amos. I'd like to hear from Hedges as to whether he would keep company with Amos. I escaped the Church many years ago and don't remember that much about the prophets of the nation of Israel.

If either of you are interested, Hedges wrote a convincing polemic in a short book called "I Don't Believe in Atheists'. I'm not sure he was entirely fair lumping Dawkins in with other prominent, but more simplistic and painfully arrogant, atheists. Still, Hedges provides a pretty good summary of his own thinking on matters religious while revealing huge holes in the reasoning of the self-proclaimed champions of atheism.

Hedges is one of the most interesting people on the 'left' writing today, imo. And peak oil aware.

... while revealing huge holes in the reasoning of the self-proclaimed champions of atheism.

This is not a rational argument - how could it be? It is not up to atheists to prove or disprove anything - by "reasoning" or any other method - it is impossible to prove the absence of supernatural forces. Surely it is entirely up to people professing religion, to demonstrate the existence of their god(s). But of course they cannot do so, so it is all based on a belief - and therefore unscientific (to say the least).

I suspect you might like Hedges book. It's not about proving or disproving. It is not about supernatural forces. It is about reason.

I believe that discussions about religion gain value when they abandon hopelessly circular debates about man-gods and move onto questions about sacredness. What hope has our species without a profound sense of the sacred? Isn't the defining limitation of capitalism its inability to conceive of value beyond markets, a sacred domain? Is socialism able to respect the spark of divinity (which I take to mean self-reflective consciousness) within each individual human? I expect you'll find that Hedges is more interested in engaging on these latter questions, though his list would be longer and his articulation better.

What hope has our species without a profound sense of the sacred?

I hope you are joking. How can one possibly have a profound sense of something that doesn't exist?

Ron P.

Does reality exist beyond the ability of the observer to assimilate what one receives thru one's senses? But, it's well documented that mind altering drugs can create mental processes which distort reality. In other situations, people experience altered perceptions, perhaps due to chemical imbalances, stress or "mental illness". If the observer thus takes the altered state to be reality, even if there is no demonstrable change from the perspective of other people nearby, wouldn't that constitute your "profound sense of something that doesn't exist"?

The old saying: "Seeing is Believing" might be better stated as "Sensing is Believing". Perhaps Dawkins is correct when he writes about "The God Delusion". Religion might be a form of mass insanity passed from one generation to the next, perhaps a mental plague...

E. Swanson

I agree that we (a species if you like, but as a society) should place a much higher value on things that do not make someone money, and just "are", rather than consumed. But bringing in terms like "sacredness", religion, "spark of divinity" (my goodness!), and so on is not useful at all - you will just muddy the waters. Or worse, it implies that humans have self-reflective consciousness because there is a spirit or a soul lurking there somewhere ... which I refute of course.

Amazing article:

I am not a pacifist. I know there are times, and even concede that this may eventually be one of them, when human beings are forced to respond to mounting repression with violence. I was in Sarajevo during the war in Bosnia. We knew precisely what the Serbian forces ringing the city would do to us if they broke through the defenses and trench system around the besieged city. We had the examples of the Drina Valley or the city of Vukovar, where about a third of the Muslim inhabitants had been killed and the rest herded into refugee or displacement camps. There are times when the only choice left is to pick up a weapon to defend your family, neighborhood and city. But those who proved most adept at defending Sarajevo invariably came from the criminal class. When they were not shooting at Serbian soldiers they were looting the apartments of ethnic Serbs in Sarajevo and often executing them, as well as terrorizing their fellow Muslims. When you ingest the poison of violence, even in a just cause, it corrupts, deforms and perverts you. Violence is a drug, indeed it is the most potent narcotic known to humankind. Those most addicted to violence are those who have access to weapons and a penchant for force. And these killers rise to the surface of any armed movement and contaminate it with the intoxicating and seductive power that comes with the ability to destroy. I have seen it in war after war. When you go down that road you end up pitting your monsters against their monsters. And the sensitive, the humane and the gentle, those who have a propensity to nurture and protect life, are marginalized and often killed. The romantic vision of war and violence is as prevalent among anarchists and the hard left as it is in the mainstream culture. Those who resist with force will not defeat the corporate state or sustain the cultural values that must be sustained if we are to have a future worth living. From my many years as a war correspondent in El Salvador, Guatemala, Gaza and Bosnia, I have seen that armed resistance movements are always mutations of the violence that spawned them. I am not naïve enough to think I could have avoided these armed movements had I been a landless Salvadoran or Guatemalan peasant, a Palestinian in Gaza or a Muslim in Sarajevo, but this violent response to repression is and always will be tragic. It must be avoided, although not at the expense of our own survival.


I am with you in this one, Darwinian. The world is full of strategically important countries that are smack on the way of other important countries, so following this logic all countries in the world ought to be occupied -mind you, the British Empire did just that.
The Russian occupation of Afghanistan was the consequence of a civil war, the Taleban were the winners in the next civil war, we can probably take it back to the invasion of Alexander the Great.
All the oil that ever flows to the mythic pipelines through Afghanistan I am ready to carry it off with a jerrycan.

Thanks Santaluciae, I appreciate the support. I am a great believer in Ockham's Razor, the least complicated answer is most likely the correct the correct one. Afghanistan has known nothing but war for hundreds of years. The chances of peace breaking out there are slim to none, and Slim just took the last train out of town.

Ron P.

I don't think it's quite that simple.

Back when the war started, there was a belief that the Caspian Sea was going to be a bonanza. So yes, I think pipelines entered into the decision. Was it the only factor? No. But without those dreams of a Caspian Ghawar, I think we may have been content to just bomb a few training camps, rather than go for nation-building.

Just jumping in for a moment to answer the original question: Are U.S Marines expendable? The answer: Yes...and proud of it. Don't bother to ask for an explanation.

Are U.S Marines expendable? The answer: Yes...and proud of it. Don't bother to ask for an explanation.

Perhaps Natural Selection will work its magic, and hopefully such ways of seeing the world will be evolved out of us. I shan't hold my breath however.

Once the selection is complete, the warriors will likely be the ones left, partnered with the farmers.

I agree cargil. Except we need to see natural selection work its magic on the political side. Not once has a US Marine ever started a war. They've all been started by a politician. The Marine in Afg didn't wake up one morning and decide to take a road trip. They were ordered there by the current POTUS. Marines do what they are trained to do: follow orders. Don't like those orders? Take it up with the politicians.

Well Said,Leanan.

I will add that just because wars have been endemic in a area in the past, it is not proven that they will continue in the future.

In times gone by, invading and controlling a place like Afghanistan was impossible or nearly so due to distance and geography.

If a modern military force with the equipment and the manpower is tasked to the job and allowed to do it's thing,the place can be MADE to be peaceable-although perhaps at considerable expense in lives of the local people.

They are undoubtedly among the most stubborn, dedicated, and motivated fighters in the world, but it is not necessary to fight them on the ground with infantry anymore if it comes down to it.

They can be offered a deal they cannot refuse-cooperate and be prosperous, or die.Of course I do not expect that our military will operate according to such rules, at least not so long as such behavior can be avoided.

But if the situation gets bad enough...all bets may eventually be off.


Slightly OT, but something I was reading in relation to plant growth and climate change, since many of us are growing our own fruits and vegetables.

It may sound simplistic, and common-knowledge, but it's important to understand the four factors that affect plant growth - light, temperature, water (humidity), and nutrition.

One which I have been paying particular attention to of late, is light, or day-length.

As temperatures climb, it may seem like a good thing, in terms of food-growing, but there are adverse affects too.

"Plants can be classified into three categories, depending upon their flowering response to the duration of darkness. These are short-day, long-day, or day-neutral plants. Short-day, (long nights) plants form their flowers only when the day length is less than about 12 hours in duration. Short-day plants include many spring and fall flowering plants such as chrysanthemum and poinsettia. Long-day, (short nights) plants form flowers only when day lengths exceed 12 hours. They include almost all of the summer-flowering plants, as well as many vegetables including beet, radish, lettuce, spinach, and potato. Day-neutral plants form flowers regardless of day length. Some plants do not really fit into any category but may be responsive to combinations of day lengths. The petunia will flower regardless of day length, but flowers earlier and more profusely under long daylight. "

So, as plant species move north, they run up against issues of latitude, where the day-night hours are more variable than at the equator, where days and nights are pretty much of equal length.


It should be of concern that, even if the growing season becomes longer in some locations, flowering may be delayed or prevented due to issues of day-length.

With regard to temperature, it is known, for example, that peaches are particularly sensitive to having enough winter cooling hours - around 1000 hours.


Plants aren't just temperature-adapted, they are latitude-adapted.

Plants aren't just temperature-adapted, they are latitude-adapted.

That is undoubtly true. The question arises though, that since plant generations are a year or less (were not talking trees here), that selection/evolution may be able to keep up.

It's a good argument for seed-saving, in order to select for those adaptive traits which allow plants to flower earlier in response to warming temperatures, particularly cool-season vegetables, or, conversely, if the temperature remains the same due to a northerly latitude shift, to select for plants flowering despite the differing daylight conditions.

Many here have said that the world economy will not recover in 2010 at all, and oil demand will not turn up. But it is turning up nicely at least for now - with US oil demand running about 3.5% over the comparable four week period a year ago. I submit that currently world demand exceeds world supply, and it's just a matter of time before so called excess oil and product inventories are worked off. Exportland 2.0 is in effect.

Oil Demand Shows Signs of Revival
Petroleum Intelligence Weekly (Monday, March 22, 2010)

Oil demand is staging something of a recovery. Apart from Europe, all major consuming regions are now seeing year-on-year gains, partly because of accelerating GDP growth in non-OECD economies and partly because of last year's low baseline. Global oil demand averaged 86.154 million barrels per day in February, up by 1.78 million b/d, or 2.1%, from the same month in 2009.

Subscription required.

I submit that, particularly in the US, people have a percieved MOL and that they are doing some of the things that they have put off in the last year or two. That trip to Grandma's, spring break, clearing property, etc., as well as adjusting to the new normal energy prices. Folks may also be doing some things they suspect they'll not be able to do in the future. "Smoke 'em if ya got 'em".

Can we push off the next gas spike as long as possible...???
I live in L.A. county.

Many here have said that the world economy will not recover in 2010 at all, and oil demand will not turn up. But it is turning up nicely at least for now - with US oil demand running about 3.5% over the comparable four week period a year ago. I submit that currently world demand exceeds world supply, and it's just a matter of time before so called excess oil and product inventories are worked off. Exportland 2.0 is in effect.

Just a bit of caution though. You cannot use the weekly supply/consumption reports for reliable comparison with the same period last year as they are very noisy and tend to get adjusted massively later on. If you use the monthly reports then for the latest available 3 months we see this.

Thousand Barrels Per Day
     October    November        December
2008 19,698  	19,052  	19,142
2009 18,727 	18,550 	        19,163

If we do take the latest 4 week average 19,347 as accurate then that's still 8 percent lower than March 2005 average consumption at 21,009.

The lack of demand is more or less caused by ongoing recession, rather than a concerted effort to reduce consumption. Moreover, even if the numbers truly indicate that we are beginning to consume as before, I submit that it's just continuing BAU. I don't think people consciously have the following train of thought:
1) oil is depleting and will be more expensive and/or hard to get in the future
2) therefore, I need to use as much as I can right now!

I'll know we (as in, the population at large) are serious in this country about oil when I don't see any SUVs on the road, maybe a few pickups here or there, most of the cars are compacts, and the streets are virtually empty in the evening/night.

ace on February 11, 2010 - 10:26pm
The chart also shows that oil supply and demand have been well balanced since Oct 2009. Oil supply has been just under 86 mbd since Oct 2009 and is expected to remain just under 86 mbd until about Jun 2010. Thus, oil supply and demand should stay in balance until about Jun 2010.

From Jul 2010 to Sep 2010, it is estimated that a supply shortfall of over 1 mbd will happen unless OPEC can increase production further. This means that Saudi Arabia needs to increase production to help meet expected world demand in 2010Q3. We won't have to wait long to see if Saudi Arabia does or wants to increase production to a higher level.


To the untrained eye it looks like, in general, ignoring month to month flucations, demand in the US bottomed out last year.

I provided a whole list of recent peaks (monthly and annual) in my Petroleum Demand Lessons from the Late 1970s article published here a few days ago. YOY US gasoline demand was up last fall, but not overall product supplied. US VMT is on the rise with gasoline, there is obviously a strong correlation (what other use do we have for it - Molotov cocktails? lawn mowers?).

Last week I posted some info about container movements at the Port of Long Beach and its strong correlation with diesel demand in California. CA is ca. 10% of US diesel demand. The container traffic showed a strong rebound the 2nd half of 2009 so, even though we don't have numbers for diesel supplied over that time period as of yet, we can expect a corresponding rebound in it as well.

“Chinese researchers at the Institute of Systems Engineering of Dalian University of Technology published a paper on how to attack a small U.S. power grid sub-network in a way that would cause a cascading failure of the entire U.S.”

Maybe someday, there will be a clash with China, but for now, we are their biggest customer.

Taking the Driver Out of the Car
Why robocars, and not high-speed rail, could revolutionize transportation in the next decade


Re: Stuart Staniford: The net energy of pre-industrial agriculture, up top.

I'm sorry to see Stuart Staniford get caught in the junk science of EROEI. He falls into more than one of the logic fallacies that I rail against so often.

The first is comparing things that are clearly different which are agriculture in the Middle Ages and agriculture today. According to him all the gains in agriculture since the Middle Ages are due to increased energy inputs which is clearly nonsense.

The industrial revolution began before the wide use of fossil fuel with the advent of hydro powered looms in England. That is how New England became an early industrial center. This continued for some time without fossil fuels until the invention of the steam engine.

He gives all the credit for genetic improvements in both plants and animals as well as many other technical innovations that enable about 2 million farmers in the United States to support most of the food needs for 300 million people to fossil fuels. Nonsense.

He is falling for the reification fallacy of treating a abstraction (energy) as though it were concrete. That is an error of logic. Energy exists only in its unique forms just like grain and metal. Energy can not be used to judge which form of energy to produce/use any more than grain can be the criteria to judge which grain to grow. Or metal can be the criteria of which metal to mine. EROEI is just as much nonsense as Grain Return on Grain Invested or Metal Return on Metal Invested.

But even if we buy into the EROEI nonsense, his argument is still false. No one is proposing that biofuels support industrial civilization. That a red herring argument. Clearly biofuels are merely an addition to the liquid fuel supply for the vehicle infrastructure/distribution system that mandates the use of a compatible liquid fuel. Besides I thought we were living in a post industrial society anyway.

He knocks biofuels low EROEI as unsuitable to support industrial civilization. All the while electricity which is mostly fossil fuel based in the United States and has a lower EROEI than biofuel is supporting whats left of industrial civilization in America.

How does he explain that? The answer is that there is a very dramatic increase in utility when fossil fuel forms of energy are converted into electricity that can be sent over power lines. Imagine what a computer powered by coal, natural gas or even diesel without electricity would look like. I can't even imagine it.

But when fossil fuels are changed into electric energy, the utility increase is so dramatic that the modern world came into existence even though the EROEI of electricity is much less than 1.

The same is true with biofuels. The very modest increase in energy doesn't matter. There is a dramatic increase in utility, albeit not as much as with electricity. The utility of natural gas and corn for example is quite limited. Neither can be used by the structural mandate of most American vehicles and the liquid fuel distribution system.

But converting them to ethanol creates a fuel that is compatible with the current vehicular structural mandate. That makes for the dramatic increase in utility which offsets the modest, if any, energy gain. Utility matters.

People who ignore other important factors like utility, current infrastructure, availability, price and many others are performing a disservice to energy analysis. And that is being kind.

The first mechanized loom powered by a drive shaft was built in 1785. This was about the same time as the industrial revolution began with the aid of both coal and water. However the foundations for the industrial revolution were laid down over 100 years earlier, powered by coal.

Industrial Revolution

The major change in the metal industries during the era of the Industrial Revolution was the replacement of organic fuels based on wood with fossil fuel based on coal. Much of this happened somewhat before the Industrial Revolution, based on innovations by Sir Clement Clerke and others from 1678, using coal reverberatory furnaces known as cupolas.

Despite your railings, as you call it in your post, EROEI is not junk science, it is everything. That has been explained to you over and over again and it would be foolish for me to try to explain it to you again.

But over the years I have done some railing myself. I have railed for years that the second "E" should be dropped from the equation. It should simply be EROI, or energy returned on investment. That gives one a much clearer picture and removes all the silliness like claiming that the EROEI on electricity is less than one.

The total return on investment is what counts. The energy delivered by electricity must outweigh the investment in power plant construction and the cost of the fuel, usually coal. Power plant operators must make a profit or else they are out of business. If they could not make a profit then the industry would collapse. Well, that is unless they could talk the government into giving them a huge subsidy.

The corn ethanol industry would collapse without the huge subsidies.

Corn ethanol subsidies totaled $7.0 billion in 2006 for 4.9 billion gallons of ethanol. That's $1.45 per gallon of ethanol (and $2.21 per gal of gas replaced).
Even with high gas prices in 2006, producing a gallon of ethanol cost 38¢ more than making gasoline with the same energy,..
Subsidies for corn ethanol

Ron P.

Nice post Ron.


I disagree. I think the whole purpose of performing a calculation of EROEI is to get around the problem that costs for production are not evenly calculated. Does one compute the cost of labor in China or India at the same rate as the cost of labor in the US, including fringe benefits? Does one compute the cost of electricity using that seen by the individual consumer or that of the industrial plant operator, which can be half that of the consumer level around here?

Sure, power plant operators want to make a profit, but why should the consumer pay twice as much per kWHr, after delivery charges are subtracted? As older plants are retired and new ones are built, the industrial user can plan for future conservation measures and borrow to implement those measures, but the consumer has no clue that his power bill will increase dramatically and is therefore blind sided by the change. If you want to rid the system of subsidies, why not charge everyone the same per kWHr?

Then, there's your subsidy and/or favorable tax treatment to consider. Then do a proper calculation of environmental impacts and include those in your calculation. Are the coal companies and the electric utilities going to take responsibility for destroying the Earth's life support systems, which Hansen claims will result from burning the coal? Just what is the future worth, after it is discounted in the financial accounting? Sorry, I think we have seen that ROI is a bad tool for rational future social planning, since it's too easy to slide by some of those long term costs.

Calculating EROEI does not depend upon all the financial confusion which is so difficult to sort out. That said, it may be that a test based on ROI will fail long before the EROEI problems become evident and that may be true for corn ethanol, for all I know.

E. Swanson

Typical ethanaught.

The US produced 10.75 billion gallons of ethanol in 2009 and paid
45 cents per gallon blenders credit which is $4.9 billion dollars.
The wholesale price of corn ethanol 2010 is $1.79 per gallon.
The US consumed 138 billion gallons of gasoline in 2009 and paid ~$2 per gallon.
Right off wholesale ethanol is ~11 cents cheaper than wholesale gasoline and there is a barely noticeable 2% energy difference between E10 and straight gasoline.

Unsurprisingly, ethanol is staging a big comeback which doesn't fit with the ethanaught talking points.

Comeback for ethanol

You'd think that doomster cheerleaders who expect the collapse of Ghawar and Burgan any day would look favorably on a new source of auto fuel that is growing at 30% per year on average (4.8 billion gallons ethanol in 2006 to 10.75 in 2009).

Matt Simmons and friends have been predicting the collapse of Middle East oil fields ( in the manner of Cantarell) for 5 years with little to back up their warnings. You'd think
having a domestic source available would be worth something.

But no. As usual we have the ethanaughts dredging up their dated ethanol angst.

The news is actually good( and how embarrassing for these self-styled 'energy experts').


You must think that I'm following you around. The fact is that you engage in interesting subjects, but often make assertions that are questionable, at least in my humble opinion.

"However the foundations for the industrial revolution were laid down over 100 years earlier, powered by coal."

I don't buy this claim.

The intellectual foundations of the industrial revolution developed over centuries, and were not related to coal. The invention of numbers, and particularly the number 0 was among these. Just think of the computing capacity of an accounting system without the number 0. Constitutionalism in Britain was an important foundation in that it constrained the power of the old, landowning elite and provided a reasonably smooth process which led to entrenchment of the power of the rising bourgeoisie in a variety or legal and other measures. The wind-powered overseas trade that permitted the formation of a large pool of liquid capital was an exceptionally important foundation. The agricultural revolution that displaced farm labour, while generating agricultural surpluses, and that was rationalized in the writings of Locke was another important foundation. The reorientation of people to a mechanistic version of time, an essential aspect of the industrial revolution, was greatly boosted by the dissemination of the mechanical clock invented in the 13th century. These examples do not exhaust the list of non-coal related foundations of industrialism.

This said, I don't question the notion that the presence of coal, iron, and water in close proximatey in England was an essential precondition of the industrial revolution with which we are familiar. We will never know if industrialism would have emerged as the dominant production process, without the presence of coal. What we can say with reasonable certainty is that without the other foundations English coal would have remained about as valuable as it was in many other coal rich countries lacking in the various historical developments that preceeded the first industrial revolution.

The corn ethanol industry would collapse without the huge subsidies.

*points at Jim Beam*
They make that ethanol from corn without government support and are able to pay taxes are they not?

It seems there is some utility of some sort.....

Eric, thanks for the correction. But I must correct you. Beam is bourbon and must be only 51 percent corn. George Dickel or Jack Daniels would have been a better example.

However you are correct, if you can charge $10 a liter for your 80 proof, (40%) ethanol and make the rest colored water then you can definitely make a profit without subsidies.

Ron P.

He is falling for the reification fallacy of treating a [sic] abstraction (energy) as though it were concrete. That is an error of logic.

You keep saying this, and no matter how many times people debunk you, you keep saying it. You're wrong.

"Energy" is not an abstraction just because "x" says it is. Energy is a fact of nature, not a human belief or an opinion, like "liberty" or "justice."

"Reification" is like "personification": it's the literalizing of a concept. "Justice is blind" is a metaphorical reification: people understand that you don't mean it literally. But energy actually exists in the physical universe, not in people's heads (except maybe yours).

Now stop it, before my Wrath swoops down and picks your carcass clean!

It's too bad about the Wintu tribe, but their river and the adjacent Pit River now produce huge amounts of hydroelectric power. This link says 1913.7 gigawatt hours from just part of the total system. Rather than generating power directly from the McCloud River, PG&E built a pipleline and tunnel under the mountain to take most of the McCloud River's flow over to the Pit River. http://www.imagingnotes.com/go/article_free.php?mp_id=35
A windfarm is now under construction that may be able to link with the hydro plants to smooth out the power flow. The Klamath river salmon runs may be recoverable, but the upper Sacramento, McCloud and Pit River drainage is changed irrevocably. They could find better ways to spend $60,000. There is no free lunch for energy

I listen to the Radical Radio internet stream occasionally.
They replay the Radio Ecoshock show which had an interesting lineup this week: Kurt Cobb and David Goodstein.

"Saudi Aramco has been named Energy Company of the Year for its commitment to a cleaner environment, its investment in bringing new energy streams online and its long-range vision promoting reliable supply for the future."

Wouldn't it be funny if Matthew Simmons was the guest speaker at the banquet?

The Kashagan oil field in northwest Kazhakstan, as well as the recently discovered, amazingly large (4-14 trillion cubic meters) Yoloten-Osman natural gas field in southeast Turkmenistan, “need” a non-Russian, non-Iranian, non-Chinese, western controlled outlet to the world energy market. This could be via pipelines from southeast Turkmenistan through western Afghanistan and western Pakistan to either the Port of Gwadar (after the Chinese are displaced) or to Karachi, Pakistan. Coincidentally, such a pipeline corridor would have to transit right through the areas where Taliban and terrorists strongholds have recently been “discovered”. Kind of nifty; two birds with one set of dead American soldiers.

This fight for pipeline corridors is a real win-win for the western oil companies. They get the U.S. military and the American lives lost in the process free of charge, and they get to make a fortune (Halliburton) hauling the military supplies from half-a-world away. After its all over, presuming things turn out the way they would like, they can then sell the oil and gas east to the highest bidder, i.e. India, China, South Korea, and Japan and thereby continue to decimate the job market here in the U.S. of A.

Maybe the oil companies should at least be require to pay a lifetime pension to the young families who have to endure the loss of the lives and limbs of those they love. Somehow the message needs to be sent to the energy companies that this fight for the pipeline corridors has, to date, yielded no return in exchange for an extremely large and very costly investment of money and suffering.

4 to 14 tcm and up to 70 bcm per year production (late stage development) only if it is 14 tcm. It is routine to overstate reserves during the promotion stage (e.g. Kashagan). So we are looking at possibly 30-40 bcm of production from this field. That would give Turkmenistan the chance to fill Nabucco in the long term and not by 2015. Meanwhile depletion and increased demand from China will ensure that Turkmenistan cannot supply the EU's demand even if you get your precious Nabucco and "stick it" to the Russians (as if they so desperately need you to mess with).

All of the politics and big military plans are supreme inanity.

Seems like there are plenty of people and not enough energy sources -- trading off lives for energy is likely to be an increasingly popular gambit.

Renewed Support for an Everglades Land Deal, but Cost Is Still in Question
I read somewhere the price agreed for the land and the timing meant it amounted to a bailout of United States Sugar by Florida.

Good luck America. I don't know the full details of the health bill before your Congress.

But what I so know is that unfunded promises only come back and bite you later on.

I only hope that for your sakes that you have a plan to pay for this scheme amidst changing demographics and your current debt.

Good luck dudes.

It's like a reverse mortgage. It's fine as long as you don't outlive your equity.


We sure do, inevitable default, cutback of other services and increased taxes, or perhaps further currency debasement. After all, it's only paper and ink!

It's good because making it impossible for insurance companies to deny pre-existing conditions makes the private insurance game unprofitable in the long term...imagine: they have to provide care! To everybody! Even if they need it!

How could anyone make serious money doing that?

Of course, HAcland is right; you've got to pay for it. Perhaps when the insurance companies see their profits distorted, they'll ask for a bailout, or, more likely, try to sell the whole thing to the gov't. 15 years from now, my guess is that one way or another, you,ll have to make the system non-profit...and public. Try not to get sick in the meantime.

Nonetheless, you Americans should be celebrating: weakening the Insurance Companies is one way to get closer to Public Health care.

It's less than obvious to me that, on the whole, forcing people who can't afford the insurance companies' product to buy it anyway will weaken the companies in any way. Maybe business-as-usual would have done that by eventually making nearly everyone uninsured as a side effect of adverse selection.

But "try not to get sick" seems to be good advice no matter what, and no matter in which country. In England, Canada, and some other places, add "but if you do get sick, get deathly sick right away, or else you'll languish and deteriorate in the queue until you are deathly sick".

"forcing people who can't afford the insurance companies' product to buy it".

I hear a lot of talk about that but we have a health care system in the US, that for a large share of the constituency, the ER is default health care. I have a granddaughter who has coverage (thanks to a federal program). But their parents, both gainfully employed, have none. They would like to be able to afford health care insurance.

Can you can look me in the eye and tell why we should remain mired in the current system?


Total stupidity and brainwashing?

This is after all TheOilDrum and I always look at it from the context of the analysis of risk. For example, just about all estimates of oil supplies (at least not based on blind heuristics) have to do with probabilities. But just like no one seems to know how to do probabilities properly in this context, it stands to reason the vast majority don't understand how probabilities of risk play out in terms of insurance.

There is one optimal actuarial algorithm that will work for all health insurance policies for everyone in the USA. There is no reason to have more than one insurance company as the insurers can't differentiate their product based on this one insurance algorithm. All updates to the algorithm work by simple Bayesian updates that the US government can just as easily maintain as your garden-variety Aetna can.

Here is an example, based on working on taxes recently, there is a simple algorithm that specifies how much of an IRA distribution to take out based on your age. It looks at actuarial tables and estimates the minimum payout based on expected life expectancy from you current age. This is basic probability and no one could do any better job than the government based on the data at hand. It actually makes you feel good, because when you get to 75, you realize that you won't automatically keel over. Well that is probability at work (thank goodness). Most health insurance algorithms are no different. In other words, differentiation of actuarial algorithms between insurance companies does not exist, and they can not figure out life expectancies or health rate payouts any better than the government can with a small stable of actuarians. In this sense, commercial insurance policies are an archaic relic of a cutthroat industry. They exist solely to skim profits off the margin and via monetary exchanges.

As a former actuarial student, I am not aware of any actuarial algorithms that account for a die-off. Maybe Gail is current on this.

Which proves my point. Any widespread calamity gets footed by the people's government in the end. Any commercial insurance company will bail by that time.

"They would like to be able to afford health care insurance."

Now, someone will have to determine if they make enough money to afford Health Insurance. If they do make enough money, then they will either have to get it (and pay for it) or get a penalty or some jail time. Since they both work, they probably make enough. Since it is kinda like the IRS tax laws, it probably will come out of their pay so they cannot get behind in their insurance or drop it, not like their mortgage.

If they do not make enough money then you and I will have to pay for their insurance.

Either way the insurance company gets more money; a round of bonuses for the execs and some goes to their congress criter's PACC.

Makes sense to me.

"If they do not make enough money then you and I will have to pay for their insurance."

Lynford I would like to refer you to a piece of literature A Christmas Carol:

How did Dickens get the origin of the character's name Scrooge? One school of thought believes that it stems from a grave marker for an Ebenezer Lennox Scroggie. The marker identified Scroggie as a “meal man” (corn merchant), but Dickens misread this as “mean man”.

Now are you a "meal man"?


Joe: You missed the point that either way, the insurance companies make out almost as well as the 'too big to fail' banks.

In the months ahead if you need some food and you are in the area, stop by. Unless we are taxed out of it, we may have some surplus for you and yours.

I guess I would not qualify as a 'meal man' because we grow other vegetables and a fellow down the way grows the corn and we trade.

Have a nice day.

We won't be mired in this system for very long. But we'll be here for a while because we're all fighting human nature, except the parts of human nature that involve stubbornness, short-sightedness, selfishness, and sex.

It's less than obvious to me that, on the whole, forcing people who can't afford the insurance companies' product to buy it anyway will weaken the companies in any way.

My point was that forcing Insurance companies to provide health care to people with pre-existing conditions will weaken them. Adding more people to the system shouldn't affect this, as if the populations of insured and uninsured were equal, one would expect to find a similar distribution of pre-existing conditions in both. That said, I expect that on the whole the currently uninsured will turn out to be less healthy than the current insured population, and require more care. I think it is highly unlikely that the uninsured will be more healthy than the insured population.

In England, Canada, and some other places, add "but if you do get sick, get deathly sick right away, or else you'll languish and deteriorate in the queue until you are deathly sick".

I hear this from Americans all the time, but my Cardiologist had me booked for an Angiogram in 3 days(Long boring story about why I think Cardiologists are idiots here that I will spare you...my Angiogram was clear, by the way.) All medical systems seem to have blind spots and things they do well, and fiefdoms that have been over-funded (like Cath Labs.) No system is perfect; waiting for things like Knee Surgery or Hernia Repair is a small price to pay for the advantages and fairness a public system allows.

Canuck -- I've avoided pointing out the obvious so far but I'll use your comment as a platform. You make a good point about the probable poor health of the uninsured with one possible big exception: the under 30 yo group. A large portion of the uninsured fell into this group and for a good reason: they are generally the healthiest and don't feel (and typically don't want to pay for) the coverage. But that's how insurance is suppose to work: many who pay can't receive a benefit...they carry the costs for those they do have the need.

But now let me stir things up: it's very, very simple. The profits earned by the insurance companies in our medical system have been insignificant compared to the total medical costs. All you have to do is look at any hospital invoice you've every received and it's pretty clear where the expense falls. Insurance company profits typically come from investments made on the premiums they hold. And I know this will sound patronizing to some but it's a simple fact: insurance companies don't pay for any of the medical expense we incur. Those bills are paid by the policy owners. IOW, us. The insurance companies only handle the paper work. And that fact will be true under any aspect of the new health care legislation. The big difference is that now virtually all American tax payers will now be supporting those premium payments. And that isn't an altogether bad thing IMHO. But there will be some apparent unfairness in it application. John Doe has never paid an insurance premium in his life but now that pre-existing conditions are covered all he has to do is make one premium payment and the rest of the policy owners (tax payers) are obligated to pay for his $400,000 cancer treatment. Such is life. But I chuckle when people say it's great that the insurance companies will get stuck with the bills. In the entire history of the US insurance industry they have never paid one $ of THEIR money for any medical treatment. They are simply transfer agents. Thus I can see the insurance industry profits going thru the roof with the new law. They collect a very small percentage of the pass thru monies. And that amount of pass thru will obviously explode now that everyone is obligated to send them a check.

you Americans should be celebrating: weakening the Insurance Companies


Its not about health care.

Insurance firms are typically invested in commercial real estate. If customers are mandated, so is their ability to make a profit, no?

In the U.S. we are already past the limit of what we can afford, as a share of GDP, for health care. With more people coming into the system that does not mean that there will be an exponential rise in the amount of coin falling into the medicine bucket. We don't have the money. Health care will have to be redistributed and for a lot of people cadillac health care plans will be a thing of the past. Also older people will find over time that health care will be rationed. We cannot spend such an overwhelming share of the health care dollar on the few final months of life. For profit insurance companies will find it difficult to maintain their profit margins and over time they will whither away. And yes MD's and all manner of specialists will see their incomes return to terrestial levels.


By the same token, they may be just as determined to enforce at least some token deductible payments. Not out of the question that everyone will need to pay at least something to use health care, just to keep people honest. So the rationing may also occur on the low-end of the scale.


Yes, certainly MD salaries, along with those of other healthcare workers (not to mention practically everybody working in the economy) will go down. Either that, or they'll be unemployed. Moreover, salaried professionals have the most to lose in a future of higher taxation (which is a future we are headed toward).

However, current MD salaries are hardly extraterrestrial. While six figures, sometimes reaching up to half a mil. for some overpaid specialists, is nothing to sneeze it, it's laughable to think that doctors are anything other than strictly upper middle class.

One of the ways that elites in our society - families with inherited money, executives of large companies, and successful financiers - mislead the working and middle classes is to make them believe that the upper middle class are rich. That's what allows, say, a ceo of a tobacco or fast food company to get multimillion dollar bonuses, while the doctors toil away in the hospitals desperately trying to treat disease for the right to earn a little bit more money so they don't have to live in the bad part of town. And the working class fools -they spend all of their income on cigarettes and burgers - and believe the doctors are the wealthy ones!

None of this matters as professionals will soon learn the hard lesson that they are really just middle class (namely, poor) and that the elite continue to consolidate their position in a world of declining energy, and thereby, a smaller total pie for everybody to eat from.

By what metric does an income of $500,000 fall in the middle of anything? Have you looked at income distribution in the US?

What value is there to be found in measuring everyone against the hyper-wealthy?

In the U.S. we are already past the limit of what we can afford, as a share of GDP, for health care.

The US spends about twice as much per capita on health care as the average Western country. For instance, governments in the US spend about the same percentage of GDP per capita as governments in the UK on health care. The difference is that US governments only cover the elderly and indigent, while for the same money governments in the UK provide health insurance to the entire population.

Of course, doctors in the UK make much less than doctors in the US, and insurance companies in the UK don't make nearly as much money on health insurance, but people in the UK live a bit over a year longer than people in the US.

In fact, the US isn't very healthy despite its astronomical spending on health care. It ranks #38, just behind Cuba, in the list of countries by life expectancy . The UK ranks #22, and Canada, where I live, spends significantly more than the UK, but ranks #11. We spend more money but get a bit more value for it.

The top 5 countries, who are all really getting good bang for their buck on health care, are 1) Japan, 2) Honkong, 3) Iceland, 4) Switzerland, and 5) Australia. The average person in all these countries lives for over 81 years.

But not only does the US spend an astronomical amount more than other developed countries per capita, not everyone is even covered. I don't know enough about the US system to know where all that money is going, but I would of thought any change that increases health-care equity (a basic tenant of a civilized society) and has a chance to decrease cost has got to be an improvement.

The US health care industry spends a huge amount of money on overhead - billing is a major cost and collecting is a real struggle. Many people go bankrupt because of medical costs. In the Canadian system, the physician sends the bill to the government, the government pays it, and that's it. Billing costs are about 2% of total costs.

However, the big problem is that those people who have health insurance in the US get too much health care. It's gotten to the point that the doctors are killing people by overtreating them. So, those people who have health insurance get too much health care, and those that don't get too little. You can improve results by just averaging it out so the average person gets just about the right amount.

The results for national health care systems are considerably improved by the fact that the people who are least likely to pay for their own health insurance are precisely those that could benefit most by early treatment of their afflictions. If you catch things early, they're a lot cheaper to treat.

An important point is that the US health care system suffers from far too much litigation, the only real beneficiaries of which are the lawyers. In other countries, unless your doctor amputates the wrong leg, there's not much point in suing him. Also, if someone loses, the judge will order him to pay his doctor's legal bills as well as his own, which has a really discouraging effect on frivolous lawsuits.

US doctors order far too many tests and procedures, the main purpose of which is to protect them if there is a lawsuit. These are very expensive, and don't really tell them anything new or do anything useful, they just confirm what they already know. They only do them so they can convince a jury that they did everything possible before the patient died. Of course, the patient dies anyway because he didn't have a hope in the first place, and the doctor already knew that.

And finally, US doctors get paid too much for doing too little work. Canadian doctors get paid fairly well, but they have to work really hard for their money. On the flip side, they can always be busy so, although it cuts into their time on the golf course, they can still make pretty good money if they want to. In addition, they're always going to get paid for their time, and overhead is not going to cut into it as much. US doctors often have little to do other than think up new things they can do to their patients for more money, and then they have to worry about not being paid for it when the patient dies anyway.


Lord Hunt calling 'industrialists' together to discuss peak oil, in private.

They still don't get it, and aren't asking the right people the right questions to deal with it. Its still not even on a level with climate change, yet alone the emergency it is. Maybe the next government will be less close minded - maybe a power cut or two will bring it home.

garyp, I agree with your post, however what would you have governments, industrialists, etc. do once they do accept the inevitability of peak oil? I've asked myself that question before, because even here on TOD there seems to no clear answers to that question. Sure, we can conserve and maybe not build a new international airport, and keep deploying renewables, but really what is it that would occur to mitigate net energy decline?

  • Systematic reduction in elements dependent on fossil fuels, starting with critical national infrastructure - 10-15% reduction per year.
  • Crash programme of non-fossil fuel power stations (eg nuclear and renewables) - ramp to 100% non-fossil fuelled in 10 years.
  • Crash programme of reduction on dependence on international trade - zero within five years.
  • Systematic movement to an economic system focuses on sustainability rather than growth.
  • Build up of defensive capability.

ATLANTA (CNN) -- Prices at the pump are up nearly 9 cents in the past two weeks and a total of 18 cents in the past month, but the increase is likely to slow, according to a survey published Sunday.

CNN presents this as seemingly good news, but the huge jump impacts disposable income significantly. Death by 1000 cuts is almost presented as "we're at 900, not many left to go, let's celebrate!!"

Healthcare reform passed! Wow, it finally passed. What a miracle. I'm certain it will be looked back at historically as a great stride forward. More people will be insured, and if their numbers are right it should help reduce overall costs of healthcare.

Man, that is one big "if".

I'm all for health care reform, but this is idiocy. Single payer or frack off, I say.

When do I get my 300 page instructions to figure out whether I'm one of those that should now qualify... er ... in 2014.

All fall down.

ccpo is exactly right. Celebrating a terrible healthcare bill that will do nothing to contain costs, nor to improve the health of people, illustrates perfectly the secular decline of our society.

We've gone down the rabbit hole and there's no way out now. The future is one of terrible poverty, sky high taxation, stagflation, increasing debts just to service interest, and the ultimate breakdown of the U.S. as its realized the costs of entitlements, endless war in the M.E., and bailouts for financial institutions can never be repaid.

However, the game can go on for a long, long time. See Japan post '89. Play the game while you can.

24 hours or so later, the stock market says it all:

Yahoo Finance: "the House of Representatives passed healthcare reform last night by a vote of 219-212. The news lifted a long standing overhang on healthcare stocks, which were strong all day. In particular, hospital stocks like Community Health Systems (CYH 40.51 +2.35) and Tenet Healthcare (THC 6.27 +0.52) put in impressive gains."

So, as I learned in biz school, stocks move higher when future profits are expected to increase. Stocks of healthcare, insurance and pharma increased today, so the market believes their profits are set to increase following this vote. That, to me, means we, as consumers, lose.

Ambrose Evans- Pritchard sounds depressed. I can't blame him.

Looks like the Depression is beginning, the real meaty part of the Depression:

So, it is not enough for the EU to impose a fiscal squeeze of 10pc of GDP on Greece, 8pc on Spain, and 6pc on Portugal, and 5pc on France over three years, we need a dose of 1930s monetary policy as well to make sure life is Hell for everybody.

Be that as it may, Greece’s George Papandreou says his country is in the worst of both worlds, suffering IMF-style austerity without receiving IMF money – which comes cheap at around 3.25pc. So why allow his country to be used as a “guinea pig” – as he put it - by EU factions pursuing conflicting agendas?

The IMF option has its limits too. The maximum ever lent by the Fund is 12 times quota, or €15bn for Greece, not enough to nurse the country through to June. The standard IMF cure of devaluation is blocked by euro membership. So Greece will have to sweat it out with a public debt spiralling to 135pc of GDP next year, stuck in slump with no exit route.

I blame the EU elites that charged ahead with this project for the wrong reasons – some cynically, mostly out of Hegelian absolutism – ignoring the economic anthropology of Europe and the rules of basic common sense. They must answer for a depression.

We are all in Latvia, now ...

Obama Pays More Than Buffett as U.S. Risks AAA Rating

March 22 (Bloomberg) -- The bond market is saying that it’s safer to lend to Warren Buffett than Barack Obama.

Two-year notes sold by the billionaire’s Berkshire Hathaway Inc. in February yield 3.5 basis points less than Treasuries of similar maturity, according to data compiled by Bloomberg. Procter & Gamble Co., Johnson & Johnson and Lowe’s Cos. debt also traded at lower yields in recent weeks, a situation former Lehman Brothers Holdings Inc. chief fixed-income strategist Jack Malvey calls an “exceedingly rare” event in the history of the bond market.

Saw the one about Chavez meting out punishment to firms that haven't cut their power usage by twenty percent. Unfortunately such actions can produce erious mis-incentives. Often during droughts California would respond with cut your usage by X percent or else. The problem is, it is easy for those who have been wasteful to cut, but much more difficult for those who practice responsible conservation all along. So the mentality deveops that you gotta have some deliberate waste during normal times, so you can cut back during the pinch. If these sorts of things get enforced without some real judgement excercised as to who is/has been responsible and who hasn't, then a very wrong message can be sent.

In this case several thousand businesses were determined to have "high consumption" of electricity. I believe that the levels were based on industry averages and size. The businesses were given 15 days to reduce their electrical consumption and only those businesses that showed no reduction whatsoever or an increase are being sanctioned with a 24 hour cut.

Offices in Caracas often have very cold air conditioning. Most places I saw simply turned up the temperature or turn off the air conditioner for a few hours each day.

In case anyone is interested I'll be going this weekend to the conference on degrowth in Barcelona.


One of the working groups will be very much focused on Peak oil and Energy transition.