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Drumbeat: July 13, 2010
Posted by Leanan on July 13, 2010 - 10:19am
Nigeria: 'Insolvent' state oil company needs $6.6B
ABUJA, Nigeria — Nigeria's state-run oil company is "insolvent" and needs $6.6 billion to cover its debts and fund future oil exploration in the West African nation, a government minister said Tuesday.State Finance Minister Remi Babalola said that the Nigerian National Petroleum Corp. asked for the funding after acknowledging its costs far outpaced its earnings. The corporation owes $3 billion alone to Nigeria's federation account, which distributes oil money to federal, state and local governments, Babalola said.
Venezuela revels in oil reserves, challenges remain
CARACAS (Reuters) - Venezuela hopes to catapult past Saudi Arabia as the world leader in certified crude oil reserves when it finishes registering oil deposits in its vast Orinoco Belt this year.An increase of 22.5 percent in the Latin American country's reserves was behind OPEC's announcement last week that the group's proven reserves rose in 2009 to 1.06 trillion barrels.
ANALYSIS - Reliance on oil could lure Russia into budget trap
(Reuters) - Russia's reliance on oil to ride its way out of recession could set it up for a fall, potentially alienating investors who snapped up its Eurobond just three months ago, unless it acts now to cut spending and hike taxes.
Russia and Iran to outline future cooperation
Russia’s energy ministry said it will sign a "road map" with Iran to outline long-term energy cooperation as Moscow's investments in Iran are stalled because of international sanctions.
Petrobras 2nd-Worst Oil Stock as Politics Hurt Offer
(Bloomberg) -- Petroleo Brasileiro SA is the world’s second-worst performing oil company this year, behind only BP Plc, on concern Brazil’s government will force the producer to pay more than investors originally expected for crude reserves.
Pemex to Sell Benchmark Dollar Bonds Overseas Today
(Bloomberg) -- Petroleos Mexicanos, the state-owned oil company, plans to sell dollar bonds in overseas markets after its benchmark yields fell to the lowest level in almost six months.
Sabic Profit May Triple as Global Economy Recovers
(Bloomberg) -- Saudi Basic Industries Corp., the world’s biggest petrochemicals maker, may have seen second- quarter profit more than triple after demand for fertilizers and plastics recovered in a strengthening global economy.
City saps emirate’s gas supply
Gas demand in the city of Sharjah increased sharply last year, contributing to a shortage of the fuel across the emirate.
Analysis: Anemic Permitting Points to A Winter Utilization Drop
The approval process for "Applications for Permits to Drills" (APDs) has ground to a halt following the six-month imposed drilling moratorium put in place on May 30, 2010. We note that while two Notices to Lessees and Operators (NTLs) from the Bureau of Ocean Energy Management Regulation and Enforcement (BOEMRE, was formerly the MMS) for new safety requirements along with guidelines for additional information on drilling plans were issued on June 8, 2010 and June 18, 2010, approvals for drilling plans in waters less than 500' have yet to take hold. Just one APD that was submitted since May 30, 2010 has been approved (to Apache on July 7, 2010) in what can only be described as federal feet dragging.
Lifting U.S. Drilling Moratorium Is Too Risky, Bromwich Says
Lifting the moratorium on deep-water oil drilling is too risky as companies have yet to show they are capable of preventing and containing spills following the BP Plc disaster, the main regulator for U.S. offshore drilling said.Drillers must do a better job, and investigators must gather more data on the causes of BP’s Macondo well leak in the Gulf of Mexico before drilling can resume, Michael Bromwich, director of the Bureau of Ocean Energy Management, Regulation and Enforcement, said today at a hearing in New Orleans.
Factbox: BP assets that may be put up for sale
Below are what some analysts see as potential disposals:
Rare mix of geological factors created rich but dangerous reserves
Ken Deffeyes, a retired Princeton geologist who once worked for Shell Oil and has written about the gulf, said, "The Mississippi Delta and the Niger Delta are the only two really productive, big deltas in the world. The Amazon, nothing. The Ganges, nothing or very, very little."
Kurt Cobb: Is Net Energy Peaking?
When most people think of fossil fuel supplies, they think in terms of barrels of oil, cubic feet of natural gas and tons of coal. But in evaluating how much energy in the form of finite fossil fuels the world has left, these are no longer adequate measurements.
A clean option to chuck dirty coal
The Indian power sector is under pressure to reduce its carbon emission as part of the global effort to fight the climate change. It must shift from dirty coal to natural gas for generation on a large scale if it is to meet the objective. However, domestic gas shortage is a major obstacle to achieving that. But this constraint would significantly ease if India could find a big reserve of shale gas.
Don't believe a word about electric cars and the coming lithium shortage
FORTUNE -- Shai Agassi wants to put the world into electric cars whose batteries can be swapped out at one of his futuristic "gas" stations. But just as the cells in flashlights and laptops need lithium to run, so do -- swappable batteries or not -- electric cars. And some are now saying that will make lithium, in our increasingly battery-dependent society, increasingly hard to come by.There are rumblings in the press that the auto industry switching from petroleum to lithium is simply shifting from one finite resource to another, and even that the U.S.'s real reasons for invading Afghanistan were to secure its massive deposits of the alkali metal. Also, electric skeptics think there might be trouble accessing enough lithium to fuel the shift. Agassi, unsurprisingly, is not among them.
How Goldman gambled on starvation
By now, you probably think your opinion of Goldman Sachs and its swarm of Wall Street allies has rock-bottomed at raw loathing. You're wrong. There's more. It turns out that the most destructive of all their recent acts has barely been discussed at all. Here's the rest. This is the story of how some of the richest people in the world – Goldman, Deutsche Bank, the traders at Merrill Lynch, and more – have caused the starvation of some of the poorest people in the world.It starts with an apparent mystery. At the end of 2006, food prices across the world started to rise, suddenly and stratospherically. Within a year, the price of wheat had shot up by 80 per cent, maize by 90 per cent, rice by 320 per cent. In a global jolt of hunger, 200 million people – mostly children – couldn't afford to get food any more, and sank into malnutrition or starvation. There were riots in more than 30 countries, and at least one government was violently overthrown. Then, in spring 2008, prices just as mysteriously fell back to their previous level. Jean Ziegler, the UN Special Rapporteur on the Right to Food, calls it "a silent mass murder", entirely due to "man-made actions."
Gulf braces for power shortages
The big heat has come early to the Gulf, and residents opting to stay are settling in for another summer of discontent punctuated by power cuts.All Gulf states except Qatar face electricity shortages that intensify during the airconditioning season. Already this year, the emirate of Sharjah as well as Kuwait and Saudi Arabia have suffered disruptions.
On May 10, a 90-minute power cut grounded flights at King Abdul Aziz International Airport near Jeddah.
Illegal oil exports flourish in the region
Middle East oil smuggling is flourishing as governments fail to tackle big problems including unsecured borders, fuel subsidies, corruption and trade sanctions.The latest cases to surface involve the smuggling of oil products from Iraq and Saudi Arabia under two different sets of circumstances that highlight a systemic regional problem. On Sunday, the government of Iraq’s semi-autonomous Kurdish region said it was clamping down on fuel smuggling across its mountainous borders with Iran and Turkey.
Formosa Petrochemical Mailiao Refinery Unit Shutdown May Curb Fuel Exports
Formosa Petrochemical Corp., Taiwan’s only publicly traded oil refiner, shut a residue fluid catalytic cracker yesterday because of an “equipment fault” that will probably curb gasoline exports next month.
Shah sour gas project is delayed again even as contracts are signed
Abu Dhabi Gas Development Company has indicated the Shah gas development will be delayed by a further three to six months, even as it finalises more than US$5 billion (Dh18.35bn) of contracts related to the project.
Millions face starvation as Niger prays in vain for rain
To the north of Niger, the creeping Sahara; to the south, oil rich and agriculturally lush Nigeria – this nation straddles the Sahel – dry, hot and cruel. It has suffered catastrophic droughts – 1974, 1984 and 2005. And now, another.Five times the size of the United Kingdom, Niger is one of the poorest nations on earth with child mortality worse than Afghanistan. The absence of regular rainfall throughout 2009 has led to poor harvests, lack of grazing for animals and food reserves exhausted.
Doom Feared as Asian Carp Advances
With the country’s attention riveted on the oil spill in the Gulf of Mexico, the news in late June that a live Asian carp had been caught in the Chicago Area Waterway System, just six miles from Lake Michigan, registered only a blip on the radar of the national news media.But for state and local officials in the Great Lakes region, the arrival of the carp on the doorstep of Lake Michigan is an environmental crisis.
400 Park Geese Die, for Human Fliers’ Sake
They have been a familiar sight around the lake in Prospect Park in Brooklyn: Canada geese, scores of them. To some residents, the birds and their fuzzy offspring are charming hints of wildlife amid the bricks of the city. Recently, when one was found with an arrow through its neck, park rangers tried to corral it to administer first aid.But then, over the last few days, parkgoers noticed something strange.
The geese were gone. Nearly 400 of them.
On Monday, the answer emerged. Wildlife biologists and technicians had descended on the park Thursday morning and herded the birds into a fenced area. The biologists, working with the federal Agriculture Department, then packed the geese two or three to a crate and took them to a nearby building where they were gassed with lethal doses of carbon dioxide, Carol A. Bannerman, a spokeswoman, said.
A Watchdog’s Warning on Nuclear Waste
This week, a blue-ribbon commission on nuclear waste established to seek alternatives to Yucca will hold two days of hearings near Hanford. And one of the experts giving testimony will be Gerry Pollet, executive director of Heart of America Northwest, which describes itself as a watchdog group focused on Hanford.
Biomass Britain: do fields of energy crops spell an end to grazing livestock?
A new vision to replace our grazing land with energy crops will help reduce greenhouse gas emissions, but many are unwilling to embrace its suggestions for our future diet and countryside.
Biodiversity Inches Up Corporate Agenda
More and more companies are making noteworthy efforts to minimize damage to the environment from their activities, according to a report on business and biodiversity issued on Tuesday.
New Weather Patterns Threaten U.S. Breadbasket
DES MOINES, Iowa (IPS/IFEJ) - Climate change is expected to disrupt agriculture in the U.S. Midwest, with high carbon dioxide promoting crop growth but stronger storms, drought, floods and migrating yields dampening yields.
Sea Levels Rising in Parts of Indian Ocean; Greenhouse Gases Play Role, Study Finds
ScienceDaily — Newly detected rising sea levels in parts of the Indian Ocean, including the coastlines of the Bay of Bengal, the Arabian Sea, Sri Lanka, Sumatra and Java, appear to be at least partly a result of human-induced increases of atmospheric greenhouse gases, says a study led by the University of Colorado at Boulder.
Sea ice melting faster in Arctic
Arctic Ocean sea ice melted faster last month than it has in any previous June since satellite measurements began 30 years ago, continuing a pattern that could see a record retreat by summer's end, according to North America's main ice-monitoring research centre.The U.S. National Snow and Ice Data Center, the Colorado-based institute that tracks the annual cycle of winter ice buildup and summer thaw, says in its latest report that June's rapid melt -- which followed a similar record-setting retreat in May -- means the polar ice cover remained on pace to shrink more than it did in 2007, when an unprecedented loss of ice first prompted scientists to raise alarms about the Arctic as a harbinger of global climate change.
Seventy-eight years after Abdul Aziz ibn Saud triumphantly carved out his kingdom on the Arabian Peninsula following a quarter-century of warfare against rival tribes, Saudi Arabia is living on borrowed time. And the likely culprit of its eventual undoing is the one commodity that allowed ibn Saud to secure international legitimacy in the years following his country's founding: oil.
IEA Forecasts World Crude Oil Demand Growth Will Slow to 1.6% Next Year
Global oil demand will increase at a slower pace next year, as advanced nations trail China and other developing countries, the International Energy Agency said in its first assessment of 2011.Worldwide daily crude oil consumption will climb 1.3 million barrels, or 1.6 percent, to average 87.8 million a day, the Paris-based adviser said in a monthly report today, leaving its estimate for this year unchanged at 86.5 million. The rate of demand growth for 2011 will be less than this year’s 2.1 percent as a result of increased fuel efficiency in the industrialized nations of the Organization for Economic Cooperation and Development, the IEA said.
Crude Futures Advance as Stocks Gain, U.S. Oil Inventories Seen Increasing
Crude oil advanced in New York as rising equity markets and forecasts of declining U.S. inventories signaled growing demand for fuel.European stocks gained for a sixth day, with the Europe Stoxx 600 index rising 1.7 percent. U.S. index futures also rose. The U.S. Energy Department may say tomorrow that crude stockpiles fell last week, and the International Energy Agency predicted higher demand for oil next year.
U.S. trade deficit widened unexpectedly in May
The rise in the May deficit came despite the fact that oil imports dropped by 9.1 percent to $27.6 billion as both the price of oil and the volume of shipments declined slightly.
Brent Oil May Exceed Year High on Channel Formation: Technical Analysis
Brent crude oil may surpass this year’s high of $89.58 a barrel after prices rebounded against a rising channel formation, according to technical analysis by Standard Chartered Plc.
Cost of gas should remain steady this summer
Gasoline pump prices should stay in a fairly narrow range this summer, putting less strain on family budgets for summer driving trips and commutes to work.
Fuel Oil Losses in Europe Decline as Russia Ships to Asia
European refining losses on sales of fuel oil fell to a one-month low as Russian supplies headed to power stations and shippers in the Middle East and Asia.Refiners are losing about $12.48 a barrel from processing North Sea Brent crude into fuel oil, compared with $14.36 on June 16 and as much as $18.95 on April 5, according to data compiled by Bloomberg. The discount averaged $10.10 a barrel in the past year. Oil companies are typically willing to lose money as long as they profit from higher-value products such as gasoline and diesel.
Iran May Cut Gasoline Imports 75% in Five Years Amid Sanctions, IEA Says
Iran, facing international sanctions over its nuclear energy plans, is likely to reduce gasoline imports by 75 percent by 2015 as it expands refining capacity and tackles subsidies, the International Energy Agency said.Iran’s gasoline imports will shrink to 100,000 barrels a day in five years from 400,000 in 2009, the IEA said today in its latest monthly report.
Putin Extends Discount on Fuel Supplies for Russian Farmers Amid Drought
Russian Prime Minister Vladimir Putin agreed to extend a discount on fuel supplies to farmers, who are suffering the worst drought in at least a decade.
Feds issue revised deep-water drilling ban
NEW ORLEANS — The federal government on Monday issued a revised moratorium on deep-sea offshore drilling, imposed on the heels of the Deepwater Horizon oil spill in the Gulf of Mexico.Unlike the previous moratorium, which was struck down in federal court, the new one isn't based on water depth and applies to any deep-water floating facility with drilling activities. It will last through Nov. 30.
Analysis: New moratorium could spell more legal fights
WASHINGTON (Reuters) – The Obama administration issued a revised moratorium on deepwater oil drilling Monday but will likely face another tough legal battle with the companies which have so far successfully sued to get the original drilling suspension lifted.
BP hopes cap will end Gulf oil nightmare
NEW ORLEANS, Louisiana (AFP) – Oil giant BP hoped Tuesday to finally stem the catastrophic flow of toxic crude in the Gulf of Mexico as it tested a new tighter-fitting cap attached to the gushing well.The test, according to BP, will last from six to 48 hours "or more depending on the measurements that are observed," said Admiral Thad Allen, a former Coast Guard chief who is leading the US government's response to the crisis.
Abu Dhabi May Make BP Investment, Crown Prince Says
Abu Dhabi’s crown prince, a member of the board of one of the world’s largest sovereign wealth funds, said the emirate is considering an investment in BP Plc after the company lost half its value following the worst oil spill in U.S. history.
BP may face probe over bomber's release
(CNN) -- A group of U.S. lawmakers have called for an investigation into whether BP may have played a role in lobbying for the release of Abdelbaset al Megrahi to secure an oil contract with the Libyan government.
BP replaces key staff in global fuel oil team
SINGAPORE (Reuters) – BP Plc has replaced key staff on its global fuel oil and Asia marine fuels teams with internal personnel, following a wave of resignations more than a month ago, industry sources said on Tuesday.
Kazakhstan Plans to Levy New Crude-Oil Export Tax on Chevron-Led Venture
The government of Kazakhstan plans for the first time to tax exports of crude oil from a venture led by Chevron Corp., in its latest effort to seek more revenue from the central Asian country’s energy wealth.Kazakhstan’s cabinet today approved a crude-oil export tax of $20 a metric ton, said Farida Batyrbayeva, an Astana-based spokeswoman at the Ministry for Economic Development and Trade. The tax, which applies to most oil producers in the nation, will take effect 30 days after it is published in official media, she said by telephone.
Iran: Missing scientist surfaces in Washington
TEHRAN, Iran – Iran said Tuesday a missing Iranian nuclear scientist, who Tehran claims was abducted by the U.S., has taken refuge at the Pakistani embassy in Washington and is asking to return to his homeland.
Population ballooning out of control
The population isn't merely replacing itself. It's ballooning out of control and conservative estimates predict a grand total of 10 billion consumers (sorry, "human beings") by the year 2050. As James Lovelock pointed out in the deeply unpopular but stubbornly relevant Earth Feedback Hypothesis, that is nine billion more than are needed for a sustainable and comfortable coexistence with the biosphere. I call them like I see them and I fail to understand how could one cast an eye over this overpopulated rats' nest we call home and declare the numbers insufficient.
Nitrogen and Phosphorous: The Future of Toilet Design Hangs in the Balance
Now, some of you who remember your periodic table might have noticed something funny about these claims of scarcity. After all, one fundamental law of matter says you can't "use up" elements like nitrogen—they're conserved, neither created nor destroyed. So an atom of nitrogen can never really disappear. (Radioactive elements do decay and disappear, but the vast majority of atoms are not radioactive.) Besides, there's plenty of nitrogen in the air—four out of every five molecules you breathe. It's hardly in short supply. AdvertisementThat said, the useful form of an element can disappear. Pure nitrogen in the air acts differently than saltpeter nitrogen, which is locked into a molecule called a nitrate. For plants, nitrogen in the air just isn't palatable—it's analogous to dying of thirst in the middle of the ocean. Plants need nitrates or other forms of the element. So even though the world supply of nitrogen atoms hadn't decreased by 1900, the supply of nitrogen that plants can actually use had decreased.
For recyclers, one (complicated) word: Plastics
Just as America is addicted to oil, it's positively hooked on plastic.Americans rely on plastic made from crude oil and natural gas in virtually every aspect of our lives — from soda bottles to car parts to toys. And yet even as the Gulf Coast oil disaster is causing more Americans to rethink their dependency on petroleum, we're doing a poor job of reusing the plastic we already have.
Guru of crude Matt Simmons shook the industry with his peak-oil predictions. Now he's betting on wind with a new company that could go to public with a $1 billion IPO.
McGuinty Government Deliberately Conceals its Cuts to Solar Power?
As anyone who reads this column knows, I have been a steady proponent of the Green Energy Act, passed last year. I believe it is a good act – indeed excellent, as it makes Ontario just about the only jurisdiction in North America to take the future fuel shortage seriously (e.g. Peak Oil), and proposes a workable plan to minimise this impact on the province. Although I am not a great fan of McGuinty, this act alone would have guaranteed him my vote in the next provincial election.Imagine my surprise when I discovered, quite by accident, that the tariffs for alternate energy were changed without notice.
Wake up to a Himalayan opportunity
Surprisingly, geothermal energy, which is available throughout the year, is not on the radar of the government of India. Even the recent order of the Central Electricity Regulatory Commission (CERC) directing electricity utilities to purchase green power to the extent of minimum 6% of their installed capacities, lists all renewable sources except geothermal. One can argue that currently, geothermal is not available; but if it is not even listed as an option, it would discourage its development by potential investors.
Why the environment is no longer a surefire political winner.
U.S. Election-Year Pressures Might Sink Carbon Cap Legislation, Kerry Says
U.S. lawmakers might be too focused on elections in November to approve legislation this year that charges power plants and other industrial companies a price for releasing carbon dioxide into the atmosphere, said Senator John Kerry, a leading advocate of the pollution-cutting plan.
Province receives A- grade on curbing climate change
FREDERICTON - An environmental group has awarded New Brunswick a grade of A- for its adoption of a regional plan to curb climate change.
Reading the printed page is 'greener' than online browsing, says papermaker
"Reading a newspaper has a lower impact on global warming than reading the news online for 30 minutes," according to Torraspapel's Paper: the alternative to climate change report.The Spanish group added: "Teaching with textbooks printed on paper contributes to global warming 10 times less than the use of electronic documentation."
Scientists Quantify Global Warming's Threat to Public Health
Extreme weather induced by climate change has dire public health consequences, as heat waves threaten the vulnerable, storm runoff overwhelms city sewage systems and hotter summer days bake more pollution into asthma-inducing smog, scientists say.The United States – to say nothing of the developed world – is unprepared for such conditions predicted by myriad climate models and already being seen today, warn climate researchers and public health officials.
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The IEA’s Highlights of the Latest Oil Market Report is out this morning. Unlike most other Highlights they gave no estimate of June oil production. Last month they said May liquids production would be down 575,000 barrels per day, OPEC down 30 kb/d and non-OPEC down the rest or 545 kb/d. But the June estimate was in their full report, available only to paid subscribers now but available to the public in two weeks. And one of those subscribers let the cat out of the bag. June oil production was down 255 kb/d on top of the 575 kb/d drop last month.
IEA: Oil Demand To Be 'Entirely Driven' by Non-OECD in 2011
They have changed their opinion about non-OPEC production. Like the EIA they have been predicting that non-OPEC production would be down slightly next year. Now they are saying that it could be up by as much as 400 kb/d.
I disagree with that prognosis. Of the above only Brazil has any real hope of any big increase. And several other nations are now in serious decline, not just Mexico and the North Sea though many of those had a temporary pause in their decline rate in 2010.
But I only track crude and they are obviously counting on a big increase in global biofuels. They seem to have put them in order of the size of the increase they expect with global biofuels second only to the increase they expect from Brazil. That may happen but that’s all we need… more palm oil out of Indonesia and destroy what’s left of the orangutan’s habitat.
One more point. Notice how they are hedging their bets on demand growth for 2011. But they are expecting all that growth to come from non-OECD countries. They expect demand from OECD countries to decline. That does not bode well for any economic growth in the OECD economies next year. Even the perennial optimists are getting pessimistic.
Ron P.
Ron,
Thanks for the summary. With the economic downturn demand may have dropped faster than supply but supply is still dropping.
I agree with you that it will be hard for conventional economies to grow when crude output is constrained. One more drag or Head Wind as it is now called to get people back to work.
Ronny-
Just watch oil skyrocket when the numbers don't add up. Easy finding paper barrels, but finding real barrels is like finding the rare dingle berry.
Ron, your suspicion is lower crude production due to ageing, depleting fields (I presume), but is it also possible it's due to lower demand? The reason I ask is because today's approx. $75 a barrel price may be weighing on the economy to cause recession and in turn lowering consumption/demand.
Really interesting though if you are correct.
Earl, my comments on production dealt entirely with non-OPEC producers. They are all producing flat out. The economy may, if it really gets bad. affect their production, but not likely. The worse their economy gets the more they will try to produce. Lower oil prices, in the future, will not cut non-OPEC production unless the price gets very low. And also my comments dealt with future non-OPEC production.
Also remember that the price of oil is, by historical standards, still really high. This gives non-OPEC nations an incentive to produce every barrel possible and that is exactly what they are doing. Current non-OPEC production is now currently as high as they can possibly get it because the producing nations need every dollar they can collect. They are making heroic efforts to produce every barrel possible.
Ron P.
Thanks for the reply, Ron. I didn't realize non-opec had a market for every barrel produced, so a drop in production is certainly worthy of concern. As this plays out, it will be interesting to see to what extent opec can make good on their spare capacity claims.
Guess you've probably already seen this article by Tom Whipple, that reiterates the concern for the May-June drop in non-opec oil production.
http://www.fcnp.com/commentary/national/6896-the-peak-oil-crisis-a-mid-y...
'The Peak Oil Crisis: A Mid-Year Review'
A new TED Talk: Carl Safina: The oil spill's unseen culprits, victims
Thank you for this, Energeek. I am glad to hear that the ecologists are starting to get some airplay. As he says, the dispersants are a crime, and putting the criminals in charge of the cleanup is insanity. Sadness.
Sounds like good news, but as always the Devil is in the details
"I have put out a direction that the press are to have clear, unfettered access to this event, with two exceptions -- if there is a safety or security concern," said Allen. “This boom is critical to the defense of the marshes and the beaches.” "We need to discriminate between media, which have a reason to be there and somebody who's hanging around when we know that we've had equipment vital to this region damaged," Allen said.
The Unified Area Command Joint Information Center will give out credentials for media to display. Being cynical I suspect this is at most a very slight lessing of the control of reporting and picture taking. We shall see.
Full article at http://www.washingtonsblog.com/2010/07/breaking-news-update-due-to-popul...
More embedded reporters..
I wonder if Amy Goodman will get a pass?
(She's got a long interview with Sean Penn, who's been volunteering in Haiti for the last 5mos.. as the Aid has been putting Haitian refugee camps between the old mass graves from the Duvalier days.. meet the new aid, same as the kool aid!)
The coverage on Monday by Amy Goodman was more informative than the interview today with Sean Penn, but it is good to be reminded of the plight in Haiti. I was there for 3 mos in 93. It would have been hard for me to imagine at that time that things could get worse for Haitians.
Interference with Haiti, ever since it was colonized, and more so since the slaves had the gall to win their own freedom, is the main reason the country is so desperately poor. Now there are plans to "help" the people with factories in free enterprise zones. Pay will be less than $4 a day.
I was also glad to hear some good radio on NPR this afternoon, at the Commonwealth Club of California.
'Stephen Kinzer, former Correspondent for The New York Times and Author of Reset: Iran, Turkey, and America’s Future & All The Shaw’s Men. ..'
Where he went over the Mossadegh Coup and its relationship to US and English power, the Anglo-Persian Oil Company, etc. Made several comments about how many shared interests US and Iran seem to have, and how we could probably shape a far different future with that society than we are doing today.
I didn't expect to hear this story coming from the country club channel.. but glad I did.
Nice when once in a while we get reminded of the real history of the USA not supporting democracy but rather overthrowing democratically elected governments (or helping in their overthrow, or not protesting their overthrow). Most recently that included Haiti and Honduras. There is a difference between loving "some" but not all democratically elected governments and loving democracy.
CNN Cooper was in a rage this morning. Their group brought in thousands of dollars of relief supplies. The PTB/customs in Haiti is charging a 20% duty on relief supplies and huge storage fees for each day the duty goes unpaid. Corrupt officials are clearly exploiting this disaster to further pad their pockets. Time for another revolution? Billions in aid monies are not reaching their intended beneficiaries.
Makes one sick.
Ever send something big and valuable to Canada? They will rake you over the coals. They even double charged me and threatened to take action against my company (if I didn't pay twice as much). Never seen anything like it. Corruption in customs is a worldwide reality.
Questions about what happens with 20%+ unemployment for some years due to declining energy were addressed on latest Campfire.
Consider the recent curfew at Chester PA to curb violence and shootings.
"Chester is an impoverished small city just south of Philadelphia on the East Coast of the US. Like so many formerly industrialized towns, it is characterized by high unemployment, blighted neighborhoods, failing schools, drugs and crime."
new business....Casino
Fighting based on turf struggles.
More super scary feed back loups;
"Amazon Storm Killed Half a Billion Trees in Two Days"
http://www.treehugger.com/files/2010/07/amazon-storm-killed-half-a-billi...
"The storm in question passed through the affected area over the course of just two days in January 2005, which resulted in the loss of human life as well. In that period, the study estimates that anywhere from 441 million to 663 million trees died, releasing their stored CO2. All told, the trees lost represents a whopping 23 percent of the total amount of carbon it's estimated the Amazon accumulates each year."
"What's worse is that as global temperatures rise from CO2 emissions worldwide, such powerful storms may become all the more common -- resulting in a vicious cycle that could accelerate the effects of climate change."
Sure, it was a powerful storm, which gets the initial blame for the dead trees, however it appears the article is pointing the finger at drought.
But, it might be a combination of drought followed by a huge storm, both of which are AGW induced.
Essentially what we experiencing is the frog slowly coming to a boil. Just like the aging process, we don't notice the changes daily, but over time they build and take their toll.
Astounding. So the trees blew over and then instantaneously released "stored" CO2. Stored where?
Once again, Treehugger astounds.
Well in the Amazon every scrap of wood that hits the ground will be gone through decomposition in a couple of years. It is pretty amazing. You walk through a forest in the temperate zone and end up climbing over dead trees a lot, but in the Amazon if the forest has had low disturbance for a several years the understory is remarkably lacking in litter.
So the answer to where is "the air."
But then the "understory" has additional carbon in it, as things eat the things that eat the trees, and the understory is further nourished and gets more sunlight.
I agree that there is a net (perhaps large) CO2 increase in the atmosphere, but my points are a) trees do not store CO2 (rather carbon, if you must), and b) the CO2 doesn't get formed at once.
They store it, if only for a finite period of time. The important thing is the quasi-steady state carbon content per acre. If that goes down, because some areas are still recovering from events like this one, then it is a decrease in carbon storage by that landscape.
Actually most of the carbon was probably released as methane, some 105 times more powerful as a greenhouse gas than CO2 over a twenty-year period. This is because most of the very rapid breakdown of wood in the tropics is effected by termites, and much of the carbon they ingest ends up be emitted as methane.
So the Treehuggers, whom you seem to love to ridicule as overstating things, were probably understating them in this case.
The feedback mechanism is very much like what happened in earlier cases of extreme global warming seen in the archeological record: extreme drought weakened much of the plant life, then extreme wind and rain storms blew and washed away what was left. Mark Lynas has some nice/grim descriptions of the mechanism in "Six Degrees."
Re the article on Nitrogen and Phosphorus and composting toilets, the simplest such toilet is the one described in the Humanure Handbook
http://humanurehandbook.com/
Leaves, some 5 gallon buckets and a toilet seat for comfort, a couple of compost piles and one is in the business of recycling perhaps the most important waste on the planet - the residue of the foods we eat.
Is there a source of information regarding the re-capture of nitrogen and phosophorous from municipal waste management systems?
I was reading the article linked about called A Green Retreat: Why the environment is no longer a surefire political winner
One of the things it says is
This is bizarre. How could so many people be deceived into believing the program was working? Is it just that comparison made using rosy long term forecasts don't look as bad as cash flow outlays?
The Germans need to adopt American economic efficiency. One hundred and twenty-five billion gets a squadron of fighter jets, a few missiles and a whole bunch of Hummers. And some pencils, paper and lots of merit badges for the brass.
Instead what are the Germans stuck with? A way to recirculate their growing trade surplus through companies and a workforce rapidly climbing the learning curve in what will be one of the world's largest industries in a few short decades. How boring.
The tariff for solar electricity in Germany is being reduced, as was long ago annouced, by 25%, now that their industry is established.
And the Germans successfully engineered a lower Euro. Watch their solar industry exports climb.
What's so bizarre? If you do care to look to long-term results, investing in Solar infrastructure gives you a guaranteed ROI that will surpass the initial (yes heavy), Outlay. Scaring people that 'it costs a lot up front' is a sure-fired way to prevent them ever noticing that they'll also have a long-term property that pays back regardless of the coming changes in fuel prices, grid rates, or even Feed In Tariff amounts. The FIT just makes it a little easier for those only persuaded by short-term results.
Germany has a solid history of being willing to make hard investments and take the pain up front, while keeping their 'eyes on the prize' .. this discipline has paid off after many hard times.
Yep, this piece smelled fishy from the beginning (perhaps the ubiquitous Shell Oil adds made me suspicious that it wasn't completely "fair and balanced"?). A one-minute search on the author came up with this:
http://climateprogress.org/2010/05/31/newsweeks-stefan-theil-uncertain-s...
Any article that talks about changing perceptions by the public about GW that doesn't mention the concerted attack by well funded denialists is telling very large lies of omission, at least.
I have the exact same question about the US economy, the banking system and the stock market...
Truly bizarre!
I guess a lot depends upon ones definition of working. Clearly for the local solar industry the program was working. For the average power consumer, not so much. But, even here determination of cost/benefit isn't very straightforward. If the solar comes during periods of peak demand, then the feed-in-tarrif price might be a bargain for the utility (i.e. cheaper than securing peak power from other sources). That portion which doesn't coincide with peak demand, of course has much lower value.
I think they problem is setting the feedin tariffs unrealisticaly high. If I were getting $.50 per KWhr from my solar panels I would feel like a crook. If I were given a renewable energy credit of $.05 per KWhr, I would consider the fee well earned. Obviously subsidies that are intended to bootstrap an industry need to be reduced as the size of the industry increases. Delaying doing that until the cost becomes obviously painful is waiting too long, and risks a backlash.
Spain world leader in CSP -- 432 MW
The new Solar Plant La Florida, with 550,000 square meters of captation (the biggest in the world) and 50 MW, in Alvarado, Badajoz puts Spain at the front and surpasses the USA, at 422 MW.
Spain has eleven Solar Thermal Plants working and another twenty in construction, well-advanced.
The plants are: Puerto Errado (1,4 MW), PS10 (11 MW), PS 20 (20 MW), Andasol 1 (50 MW), Puertollano (50 MW), La Risca (50 MW), Andasol 2 (50 MW), Solnova 1 (50 MW), Extresol 1 (50 MW), Solnova 3 (50 MW) and La Florida (50 MW).
432 MW that's the equivalent of a small Atomic Power Station but without the risks, not a terribly difficult technology: mirrors, steam, generators.
According to the industry in less than a year an additional 600 MW will be produced, and 2,500 MW in total by the year 2013.
Link (in Spanish)
The advantage of CSP over photovoltaics is that silicon degrades over time because of exposure to the rays of the Sun and cosmic rays, while mirrors do not.
Solar towers also allow for higher temperatures than parabolic mirrors so better efficiencies.
Spain is not a tropical country, Madrid lies at the latitude of New York; so what works for Spain must work for most of the USA, Mexico, Peru, Chile, Bolivia, Brazil, Argentina, most of Africa, the Middle East, Australia and a great part of Asia.
The dream of supplying Europe with electricity from the Sahara is a step nearer.
But I thought mirrors were just Fossil Fuel Extenders?
Yay, centralised power from one of the most unstable regions on Earth! Can't wait.
How is that centralized? It'll be repeatable in countless areas, just as the multiple existing and coming installations in Spain already seem to show.
AND they won the World Cup. What a great country!!
Spain didn't win the Cup.
It was Barcelona with a few token Real Madrid.
Now if Our Harry could only fill Spurs with Englishmen we would win it in 2014 too.
;)
ps, hate Spurs but the best vehicle we've got at the moment.
Sour grapes !
Spain: European and World Football Champions, Nadal (tennis) and with a bit of luck Contador may win Le Tour de France.
In all honesty I think the best performance was Uruguay's. Just 3,5 million people, finished fourth after facing Holland and Germany.
You look at the body build of a Latinoamerican or Spanish football player and at Rooney and you see the problem of England, they aren't football players more like horses with wooden legs. And what was Beckham doing in South Africa, the man never won anything in his life. Except a fortune from the media.
And the English WAGS -wives and girlfriends, Las Botineras!
As the English newspapers -England has some of the best, and some of the worst newspapers in the world, and the English buy and read lots of newsprint- had to find a way to sell more and the soccer players are not the most articulate of people, they invented this thing with their WAGS, so they can show pretty young women buying, and smiling with lots of bags from the stores, and falling in and out of love, and buying a new dress or three, buying a new diamond ring, or a new car and in general filling the vicarious fantasy of lots of women who will never get a powerful, rich, young sportsman as partner.
Consumption, not sport and it shows in the dismal performance of Britain in all sports.
Once an Englishman was telling me about the not very good performance of Spain in athletics. It is true that a few years ago when there was a competition other teams asked if Spain was running
-- Good! At least we won't come last.
Things have improved a little.
So I told him that results do not matter to us, it is because in the Spanish team, only the Spanish run.
I must say, I like the English. He instantaneously got what I meant, and he actually blushed.
Actually it's Fossil Fuel that is the all time, smoke and mirrors trick, it conjures up an unsustainable civilization and then it burns away and goes poof!
I want our economy to be based on CANDY!
WHERE'S MY CANDY!!!
I am a firm believer in pushing renewables but I am doubtful as to the current day returns on investments.
Does anybody here know how much these concentrating solar plants in Spain actually cost in the aggregate, and what the average capacity factor is?
How much is the output of these plants really worth, using current daytime fossil fueled generated electricity as the basis of comparision?
How fast might we expect the costs of such plants to fall as the economies of scale in building new ones and engineering advances in thier design and construction come into play?
My guess is that within a decade they will look like bargains due to rising prices of oil, coal , and natural gas.
But spending the money on a nuke or two might be a better bet for the next decade or two, considering the low price of uranium and the high day in day out year in year out base load output of a nuke.
That business with the dissident Saudi prince's open letter may be the first shot of a titanic struggle over Saudi oil.
And the US could be covertly involved even at this point, adding fuel by means of the Forbes piece. I've been expecting some sort of shakedown of the Saudis to get them to produce more or otherwise keep them in the US fold and dissuaded from pursuing their own interests independently.
The exploration moratorium that the Saudi's announced seems odd also. What harm is there in exploration? Until you realize that billions of pairs of lustful eyes are fixed on whatever you find. Better to keep it draped in a burqa.
The U.S. has long had a special relationship with the House of Saud. We protect them, and they keep the oil coming. The Saudis know which side their bread is buttered on, and though they kicked American troops out of their country, they are happy to see the U.S. staying in Iraq, both as a buffer against Iraqi aggression a la Saddam and even more importantly to keep Iran in line. It is no secret that the House of Saud would be delighted for either the Israelis or the U.S. to destroy Iran's ability to build and deploy atomic weapons.
The U.S. has long winked at minor peccadillos by the Saudis--things such as open slavery, an official state of war against Israel, and the funding of Islamic terrorists. So long as they keep the oil spigots flowing, the Saudi Royal Family is safe. And they know that fact very well.
So long as they keep the oil spigots flowing,
But are they flowing? The House of Saud is defending an oil price ($70+) that may make it difficult for the US economy to escape stagnation. I'm sure powerful elements in the US would prefer they chose to defend $50 or even $40.
The price of protection may rise as it is wont to do.
I expect the price of oil to decline to the sixty dollar range over the next six months.
Saudi does not want to close the spigots to jack up price above $75 per barrel; they like the $75 price, but weak global demand is likely to reduce oil sales and hence prices. I think production will stay about the same over the next six months, though it is worth noting that KSA has some excess capacity, somewhere between 1 mb/d and 6 mb/day. This excess capacity may come online to increase production over the next three or four years. My guess is that Saudi production capacity is holding about steady, but sooner or later (five years?) it will decline and may be declining now. Because of Saudi secrecy it is impossible to know the actual amount of production capacity or the actual amounts of excess capacity now in existence.
Some on TOD claim that Saudi Arabia has no excess capacity or negligible amounts. They write in good faith but base their conclusions on SWAGs. I see no reason to believe these claims, nor do I believe the claim of 6 mb/d excess capacity; perhaps the true number is in the vicinity of 3 mb/d; anyway, that's my WAG.
3mbd excess cap is a perfectly good WAG. I'm guessing that or prolly a bit less on the principle that things are almost always worse than you think.
But remember this, that whatever it is, it's almost certainly the more expensive to lift stuff, the result of the newer field development initiatives upon which they have invested a lot of money.
I think the Saudis will defend $70/brl oil. I don't think they have any choice. They need the money too badly. Their population is larger, poorer (and more restless) than many people assume. They have to keep their welfare state moving forward or the royal family is doomed.
For reasons similar to the Saudis, I am keeping oil production from my properties below one million barrels per day.
lol....me, too.
Actually, I keep production well under 25,000 bpd. Any extra income and I'll disrupt my county's finances.
WT - glad to hear that as we wouldn't want you to fall into the Dutch Disease trap.
You have to keep in mind that Saudi Arabia's fields are old and are getting older. They have a natural decline rate of around 8% per year. The Saudis have to keep drilling new wells and putting in new enhanced oil recovery projects, or their productive capacity will fall by about 2/3 over the course of a decade.
That means if their capacity today is 12 million bpd, and they don't do anything, by 2020 it will be closer to 4 million bpd, and by 2030 it will be a tenth of what it is today. They have to keep drilling more and more expensive wells, injecting more and more water, putting in new EOR technology.
So, they're like the Red Queen in Alice in Wonderland. They have to keep running faster and faster to stay in the same place. Eventually they won't be able to run any faster, and they will start falling behind - Just like the United States, 40 years ago.
I remember it well because I was a snot-nosed new hire in the oil industry when the Red Queen hit the wall and couldn't run any faster. The long distance runners and Lewis Carroll fans among you may appreciate this analogy, I don't know about the rest of you.
IMO, a plausible estimate is that by the end of this year the Saudis will have shipped about 30% of their post-2005 Cumulative Net Oil Exports (CNOE).
A quick way to ballpark the point at which net oil exporters approach zero net oil exports: Given a production decline, extrapolate their consumption as a percentage of production (C/P).
The Saudi's C/P went from 18% in 2005 to 22% in 2008. At this rate, they would approach 100% in 2031. Using "Cowboy Calculus," their estimated post-2005 CNOE would be 3.3 Gb/year (2005 net export rate) X 26 years X 0.5 = 43 Gb (the area under the triangle). Let's call it 50 Gb.
Yes, and the longer they are able to keep up their 12 MMBpd the quicker production rates will eventually decline. The area under the production curve is still the same no matter how you slice it.
Is $70 all that much? It's equal to about $14.66 in 1973 dollars. That happens to be right about what the price of oil rose to as a result of the "oil embargo" and where it stayed through the remainder of the seventies up until the Iranian Revolution.
Shaman,
You are quite right; $70 oil in 2010 is historically cheap, especially compared to 1973 or 1978. The Saudis are keeping oil cheap to placate their American protectors. I do not think that they will be able to defend the $70 price of oil; by November or December my guess is that we will see $60 oil--and then further downward pressure as demand for imports by China collapses in response to their recession, which is now only in its early stages of real-estate collapse.
You make a fair guess there, but my gut tells me that demand won't drop that much unless China really falls off the cliff.
More likely (in my non-expert opinion) is that prices won't stray much out of the $70-$90/bbl window until there is a major revelation of change on either the supply or demand side. The futures chain seems to indicate a consensus expectation of slow but steady increases in the base price going forward, also, but I do realize that isn't a very reliable indicator for short-term changes.
India seeks ban on iron exports
All it takes is a shortage of one key resource like oil to make people think differently about all natural resources.
And China is cracking down on the export of some rare earth minerals used in electric cars and windmills. The face of the future and no doubt the source of more military "adventures". http://www.treehugger.com/files/2009/06/goodbye-fossil-fuel-dependence-h...
Many ways to destroy our planet, the quickest will be fighting over the remaining resources. It seems one of the more highly likely scenarios.
"rare earth minerals used in electric cars"
Rare earths are not used in electric cars. That is just a FUD.
Prius uses rare earths because of permanent magnet motor - EVs use synchronous AC motor ...
Quite.
Rare earth elements are not necessary for electrical systems, they just make certain configurations (like permanent magnet motors) lighter and more efficient.
3 phase AC motors are awesome for EV applications.
Getting three phase ac out of batteries is not a cheap or enegry efficient thing to do;I don't have any idea what the actual costs are but they must be substantial in terms of overall electrical efficiency, price, and wieght added to the car.
"A Green Retreat" by Stefan Thiel is Bjørn Lomborg style newspeak in Newsweek. The fact that it is sweetly written makes it dangerous. It really doesn't lie, in the sense of blatant big fat purple lies; rather, it skirts around the issues. Basically, it prattles comfortable little white lies (hey, doing anything about climate disruption is no fun, and expensive, so let's spend our money elsewhere) instead of uncomfortable truths.
What makes TOD so worthwhile is the multifaceted view which, by and large, look at how the cost of action ain't so high, either in fun denied or in filthy lucre.
I agree. Dang, that piece was a greazy ride.
Just line after line of painting every environmental policy concern as merely Sleazy political games.. as if they have no connection to the real problems in the world that keeps us alive. Just more imaginary issues to make hay over, I guess.
"What’s more, current economic worries are a reminder that every dollar spent on solar cells or biodiesel is a dollar less for education and other budget priorities."
Funny how renewables gets hit with that responsibility when we spend as many and far more dollars on all sorts of things that offer no future whatsoever. We still spending money on the School of the Americas? How many Highways are getting widened this summer? (That there's a Fossil Fuel Disstender)
As usual with good propaganda, there's lots of truth in that piece. Global Warming is a lot like Peak Oil in that doing anything to solve either won't result in "Business as Usual", but will require sacrifice on the part of the average man or woman on the street. Such things don't sell well in the realm of politics where the name of the game is to promise a rosy future for the voters. Anyone who has thought thru the technical and economic impacts could easily conclude that transition will not be fun. We've known that ever since the Arab/OPEC Oil Embargo in 1973. But that was long ago and was soon forgotten by most people as the price of oil dropped after 1985 until the oil price spike in 2008.
Of course, the author doesn't mention the decades long effort by the denialist camp, some financed by the fossil fuel companies, who have developed a massive network to spread disinformation and lies about global warming. He briefly mentions the so-called "climategate affair", which was a bonanza for the denialist camp as they used it to spread more FUD, declaring that the e-mails proved there was a hoax. Those e-mails have now been subjected to outside assessment which show no ill intent, but the damage done in the minds of the average Joe can not easily be removed. The author even claims that the past 2 winters were "two of the harshest winters on record in the Northern Hemisphere", which did not appear in the record of global temperatures. The author ignores the fact that while locations in the NH experienced some days of colder temperatures this balanced by other areas with record high temperatures. It might even turn out that the colder air was the result of Global Warming thru changes in ocean circulation and we are seeing the Arctic sea-ice melting at a rapid rate now that summer is here.
I think the political world will always respond to long term problems by downplaying them and trying to push then onto the next generation. The captain of the corporate and financial world will pay to have these issues ignored for as long as they can get away with it. So, the little people will continued to get shafted as their future (and the planet) is destroyed in the name of greed...
E. Swanson
Thank you E. Swanson, well said.
In Easter Island it seemed a good idea to address problems by building more statutes - appease the gods? he who has the bigger statutes wins? Wins what? TPTB might win in the sense that they have bigger salaries and bank balances than any humans on earth ever had but win what? So often I hear people say that a world with less energy is a world they don't want to live in. I think that a world devastated by climate change is a world they will like living in a lot less than a world where they have to grow their own food by the sweat of their brow. Climate change may be decades away, or some positive feedback may kick in and deliver the goods much sooner.
The first statute they built should have said "no new statues". Sorry...
Yeah no new statutes or statues - a Freudian slip perhaps :)
All too true there, blood.
Smoothly said.
NYT piece on the possibly CIA-kidnapped Iranian scientist:
http://www.nytimes.com/2010/07/14/world/middleeast/14iran.html?_r=1&hp
Isn't the news just awesome today? :-)
The thing about covert operations is that they have to remain covert, or they can become highly counterproductive.
The problem that the US has with Iran is that in 1953 the CIA was instrumental in overthrowing the democratically elected government of Iran. This was of great benefit for US and UK oil companies, but the difficulty is that, while Americans are generally unaware of the facts, everybody in Iran knows them. Everybody in Iran knows that the CIA helped overthrow their government.
If the CIA is up to its usual tricks, the kidnapped Iranian scientist saga would just be another episode in a continuing story. We'll find out when he gets back to Iran and posts it all on the internet.
And, for those Americans who keep saying, "Do you think we should invade Iran?" I would say, no, don't do it. It's like meeting a grizzly bear in the woods. You don't want to shoot it because that will just make it mad. Talk softly, back away slowly, and don't make eye contact. You don't want to invade Iran. Trust me.
I just use this analogy because I've worked and traveled with with Iranians, and grizzly bears come wandering through my back yard from time to time. Both would probably be a little outside their comfort zone for most people here.
Miami’s Downtown Comes Alive as Condos Fill With Young Renters
Colombian Armed Forces Will Scout for Oil Reserves
Last week, I predicted that the EIA would report a drop in inventories of about 5 million barrels more than seasonally typical, mostly due to Hurricane Alex. The usual seasonal drop would have been about 2 mb, so my expectation was about a 7 mb drop. It came in at about a 5 mb drop. Other analysts besides myself now question last week’s EIA report:
http://www.marketwatch.com/story/oil-gains-on-alcoa-results-iea-demand-f...
Well we will se if the truth wins out this week, but I won’t make any big bets on the vagaries of the EIA’s counting methods. More specifically, even after some quirky adjustments last week by the EIA, my WAG is that the EIA over-reported crude stocks by around 3 mb.
Last week, shut-ins and shipping disruptions were much less, although Mexican oil ports may still have been affected by an unnamed tropical depression. If the EIA basically goes back to counting onshore barrels and not apparently including barrels waiting to be off-loaded, for example near the Louisiana Offshore Oil Port, I would expect a further drop this week of up to 5 mb (3 mb over-counted last week + 2 mb seasonal drop – that is assuming imports otherwise are steady near recent levels). It's possible, that importing ports worked overtime last week to take in the extra 3 million barrels previously counted, so in that case the drop would be only about 2 mb.
In addition, there was the perplexing problem of how the recent pickup in US oil imports the last few months can be explained in view of sluggish to no-growth in overall world oil output (see the revised IEA report up top). However after recent reports that up to 100 million barrels of oil previously stored in tankers is now basically all gone, and those tankers available for hire, the import pickup finally makes sense. That is, other countries used oil in floating tankers, freeing up some extra new oil for import into the US.
While I truly believe there is some “excess capacity” around the world concerning supply, my WAG is that the quality of such oil is generally lower and that this excess capacity is intended for emergencies. Granted an emergency may be the price of oil over $100, but I don’t think producers will preemptively raise output to cut off price gains. The record over the last year does not indicate that output was increased much, if any, as prices approached $90 a few months ago. So if the IEA demand/supply estimates are correct, we may be close to that invisible wall where demand is limited by available supplies, and if so, we should expect to see US oil imports fall – and subsequently, US oil inventories fall as new supply fails to keep up with rising demand.
Late update: The API says oil inventories rose about 1.75 mb, but they had a drop of 7 mb last week. Or in other words if the EIA matches up with the API, they will report a drop of only 0.25 mb. Still looking for a 2 mb + EIA drop.
the price seems to be holding more or less in the $ 75 +/- 10% range for more than a year now. the short lived test of $ 90 notwithstanding.
it seems to me that many on here are breathlessly waiting for the price to skyrocket any day now, probably just my misperception.
No, at least in my case I AM waiting breathlessly for the price of oil to skyrocket.....MUCH more fun than going to the movies, setting off firecrackers, going out to a restaurant....
Economics is the art of mis-under-perception.
Just look at Paul Krugman's latest work of art:
According to his Krugmanship (Invincible Ignorance),
cause and effect may be deduced by graphing correlation between any set of arbitrarily chosen variables --in this case, wages and occupant in the White House.
As ho-mo.ney saps we tend to see correlation between number of money units and anything and everything under the Sun.
Gee, I wonder how much God has saved up in His pension plan?
Did He shift His investments into commodities?
Is He going long on oil?
(Sound logic for sound minds.)
I agree with poster Darwinian in the first post today that oil output appears to have peaked out for the year - despite the best efforts of non-OPEC producers to go flat out.
US oil demand was up 5% over last year, at least per last week's EIA report. Despite a generally poor employment picture, US oil demand is being lead up by very strong demand for diesel. Some of that increased demand is for exports, which apparently is driven by faltering diesel output in Venezuela and the Caribbean - which is falling due to the rapid drop in oil output by Venezuela, which leaves those refineries with less oil.
So if traditional supply/demand theories are in effect, we should see the price of oil increase, and very soon. Keep in mind that the 2008/2009 financial panic was in some ways even worse than the 1929 stock market crash it is frequently compared to, and we have to go back to late 19th century type US financial panics to make a real comparison.
My WAG is that the 'normal' price for oil then at the start of the year should have been around $75, but now the supply-demand situation is growing tighter fast.
Therefore unless another financial panic comes along, I would expect the price of oil to eventually make its way up to $100. OPEC and even non-OPEC can't or won't do a thing up until $100, and because demand is mostly insensitive to price, it will take quite an increase to slow down demand growth - which appears to be accelerating.
China is the big unknown. I'm predicting financial and economic collapse for China, but I doubt that I'm batting much better than .750 for short-term predictions. Contrary to what almost everyone else is saying, I think China's oil imports will decline over the next eighteen to twenty-four months. Imports to the U.S. will most likely increase, though at a very moderate rate.
Always remember that God created economic forecasters to make weather forecasters look good.
Bill Gates invests in new fuel efficient, light weight engine called OPOC being developed for the military:
http://www.engineeringtv.com/video/Opposed-Piston-Opposed-Cylinder
The idea of using opposed pistons in a diesel engine has been around for quite a while. Fairbanks Morse engines (PDF) used in diesel submarines in WW II had them. Those old designs used two crankshafts, one on top and one below. They gave high efficiency, like this new design, around 40%, and were very reliable, having no valves and no cylinderheads. But they were large and heavy, with the added weight of the extra crank. This new design has lots of apparent advantages regarding weight and balance. The design does require some sort of supercharger to start things running. I would surely like to see one of these coupled with a hybrid transmission system shoehorned into a car with good aerodynamics. Such a combination might produce 100 mpg at freeway speeds...
E. Swanson
"Doom Feared as Asian Carp Advances"
The strategy is going to be "If you can't beat 'em, eat 'em !"
In a deal signed today, up to 30 million pounds of carp annually are to be sold to China - they will be marketed there as "Wild Mississippi River Fish"
http://www.chicagobreakingnews.com/2010/07/quinn-catch-asian-carp-send-t...
Come on guys, let's get the Lower Churchill off the ground and get that power flowing throughout all of Atlantic Canada.
Atlantic premiers team up on energy sales
See: http://www.cbc.ca/canada/nova-scotia/story/2010/07/13/atlantic-premiers-...
and related:
N.S. power eyes better grid
Energy: Neighbouring utility outlines plans for expanded access to N.B. grid to improve its ability to import extra power
See: http://telegraphjournal.canadaeast.com/front/article/1131256
Cheers,
Paul
"Reading the printed page is 'greener' than online browsing, says papermaker"
Any truth in this ? Looks like an industry sponsored "study" ...
This stuff about Goldman makes my head spin. How can such a small group of people cause such chaos just by moving numbers around on a spreadsheet? And have they no shame?
It's just an off balance sheet emotion.
Them that's got the gold, man
Are the ones to rule, man.
What's shame got to do with it, got to do with it?
Don't you remember those Enron tapes, where the traders were caught laughing about screwing over fixed income grandmothers?
My opinion of the investment banking industry and the ethics of the people who run it couldn't be any lower than it is already, but nevertheless I find it hard to believe that markets can be manipulated for so long and on such a grand scale as lots of people think.
It seems very reasonable to think that a speculator, or group of speculators, can drive the price of a commodity up or down for a short period of time;but unless they control the actual production, or the actual marketing, of the commodity, it seems likely that the end result will be mostly a wash, generally speaking.
A few tens or hundreds of millions of barrels of oil withheld from the market would certainly cause a price rise-but also, presuming it is possible,a responding increase in production;and when the oil finally is sold, it should tend to depress prices roughly in proportion to the temporary increase.
If a rise in production is not possible, than we are basically saying the oil producers have allowed the marketing people to buy oil too cheap, and that they should move into marketing themselves in order to retain the excess profits otherwise earned by speculators.If it is possible for the producers to pump more oil, but they don't, then the culprits are producers rather than speculators.
Foodstuffs might be very different if some company or cartel could actually gain control of enough volume in a staple food to corner the market;people can't quit eating.
But nobody so far as I know has proven that vast quantities of corn, wheat,rice , or soybeans were left sitting in corporate warehouses at the end of the recent runup in food prices.
The real problem is that the supply is getting more precarious from one year to the next;the vast overstocks that once clogged the markets no longer exist;and the people in more and more countries are able to buy more and more expensive foods farther up the chain;demand propelled by increasing prosperity and increasing population is growing faster than production.
Of course the increasing prosperity part of this scenario may not last long at all.
Furthermore production is likely to grow slower than the population due to increasingly scarce water, loss of prime land to development, and ever more costly inputs such as diesel fuel, electricity, and fertilizer.
Further technical miracles are not likely to come to pass as they depend more on added inputs which must be purchased than on anything else.
The ag people pulled of thier miracle known as the Green revolution;and the medical people pulled off another miracle in controlling the more serious contagious diseases.
Now we are face to face with the unintended consequence-overpopulation- of good deeds performed by honorable people with the best of intentions.
"No good deed ever goes unpunished."
The banks have and will undoubtedly profit from a lot of misery and even outright stasrvation but in the end they will not be found to be the primary cause of it.