Drumbeat: March 11, 2011

Japan refiners at risk of lasting flood damage

(Reuters) - The huge tsunami that struck Japan on Friday may do far more lasting damage to its refineries than the quake that preceded it, flooding them with corrosive seawater that can lead to months of repairs.

As U.S. Gulf Coast refiners know, sea water flooding can destroy refineries and their operating systems in minutes.

Murphy Oil's 125,000 barrel per day (bpd) Meraux, Louisiana, refinery took 9 months to return to full production after being completely flooded by Hurricane Katrina in August 2005.

American energy companies brace for tsunami

(Reuters) - Energy companies with operations along the Pacific coast of North and South America were on alert on Friday for the possibility of a tsunami set off by a massive earthquake off Japan.

Mexico evacuates Pacific oil port, refinery safe

MEXICO CITY (Reuters) - Mexico's state-run oil company Pemex evacuated 300 workers from its only oil port on the Pacific coast on Friday after a tsunami warning rippled down Latin America following a massive earthquake in Japan.

The Salina Cruz port in the southern state of Oaxaca does not export crude outside of Mexico and only ships oil products, like gasoline, to the domestic market.

Canada crude-Synthetic premium rebounds with U.S. spreads

CALGARY, Alberta (Reuters) - Canadian synthetic crude price spreads widened on Friday in line with bigger premiums for U.S. crudes with similar characteristics and a thicker differential between U.S. and world benchmarks, industry sources said.

Libyan oil sector on its knees for months

LONDON: No matter who eventually wins the lethal battles raging in Libya, the oil market will likely be starved of hundreds of millions of barrels for a long time, reshaping oil flows from west to east. Top quality Nigerian and Caspian crude grades have shot to multi-year highs and huge premiums to Middle Eastern grades, wrecking buying opportunities for emerging Asian economies. More of this oil will likely head to Europe's refiners who do not need to pay up the long-haul voyage on top of the Libyan war p remium, unless they decide it is simply too expensive to run refineries.

EU Considers Extending Sanctions To Libyan Oil Industry

BRUSSELS -(Dow Jones)- The European Union is leaning toward extending its sanctions and freeze on assets involving Libya, as it may soon target Libya's oil industry as it seeks to raise the pressure on Libyan leader Col. Moammar Gadhafi, officials said Friday.

Q & A with Sally Odland

Sally Odland has worked 20 years as a geologist and project manager in mineral exploration for the U.S. Geological Survey, in oil and gas exploration for the private sector and in environmental remediation as a federal Environmental Protection Agency contractor.

She currently administers the Division of Marine Geology and Geophysics at Lamont Doherty Earth Observatory of Columbia University in Palisades. She holds advanced degrees in economic geology and business administration. Her 2006 MBA dissertation was titled: “Strategic Choices for Managing the Transition from Peak Oil to a Reduced Petroleum Economy.”

Will oil crunch price the Caribbean out of European tourism?

As oil and food prices continue to rise and further levies are introduced on travel, could the Caribbean be priced out of the low to middle end of the European tourism market? This alarming prospect may be closer at hand than the region would wish if the situation in the Middle East was to deteriorate further.

So much so, that the Caribbean could face a tourism shock in 2012 equivalent to that experienced after the terrorist attack on the World Trade Centre in 2001 or the global financial crisis of 2007/8.

Japan trails behind in 2010 wind power capacity rankings: survey

TOKYO — Japan placed 18th in global rankings of new wind power installations in 2010, creating 221,000 kilowatts of the renewable energy capacity, compared with the 16,500,000 kw of China, the world’s front-runner, according to a recent study by an international trade association.

Nunavut plans to promote country foods

To fight hunger in Nunavut, the Government of Nunavut will spend $1.7 million this year to set up community freezers and find ways to distribute more country foods, like Arctic char, caribou, seal and muskox, Nunavut’s Economic Development and Transportation department revealed during the recent legislative session in Iqaluit.

...By promoting local foods, the territory may be able to reduce the growing levels of food insecurity, the department says.

Saudi Arabia 'day of rage' protest fizzles

Reporting from Riyadh, Saudi Arabia - A call for protests in Saudi Arabia that had been talked about for weeks drew only a handful of people Friday, allowing the kingdom to keep at bay for now the waves of political unrest that have battered the Middle East and North Africa.

In the end, the "day of rage," organized on Facebook and by word of mouth, fizzled. No protests occurred in any Saudi cities except for a small demonstration in Al-Ahsa in restive Eastern province, said Maj. Gen. Mansour Turki of the Interior Ministry. Turki said he did not know if any arrests were made in connection with the Al-Ahsa protest. Human-rights activists did not return phone calls seeking comment on the events.

Hundreds Protest in Eastern Saudi Arabia

RIYADH, Saudi Arabia—Hundreds of protesters Friday took to the streets in the eastern Saudi Arabian cities of al-Hofuf and Awamiya, a day after police broke up a march in the same region.

About 500 protesters, mainly Shiite Muslims who make up a large part of the population in the area, demonstrated in the oil-rich eastern province. Al-Hofuf sits on the east flank of the country's major oil field Ghawar.

Cheapest place for a gallon of gas: Libya

Today, gasoline costs the equivalent of 46 U.S. cents a gallon. Last week, the price was just over 62 cents.

Oil company officials in Libya say the drop had nothing to do with the traditional rules that drive prices, such as supply and demand: Gadhafi ordered the price cut to curry favor with his unhappy people.

And in that way Libya is like the rest of the world: Oil prices have only a little to do with supply and demand.

Crude tankers to face near-term Japan headwind - Wells Fargo

(Reuters) - As one third of Japan's refining capacity shuts down following Friday's earthquake, near-tern demand for crude tankers would suffer, Wells Fargo Securities said.

Japan tsunami "bullish" to global fuel oil upcoming months: sources

A tsunami triggered by a large earthquake that struck northeast Japan Friday and prompting the country's power operator to shut seven nuclear units will drive utility-grade low sulfur residual fuel oil (LSFO) prices higher, sources said Friday.

Obama 'confident' US can fill any gap in oil supply

(Platts) - After weeks of crude oil prices hovering around $100/barrel because of turmoil in North Africa and the Middle East, President Barack Obama Friday sought to reassure Americans the US can weather the current price spike.

Obama did not propose releasing oil from the US' Strategic Petroleum Reserve, something Congressional Democrats have repeatedly requested in recent weeks, but said in televised remarks from the White House that an SPR release is possible if conditions worsen.

No tsunami impact on Sakhalin projects

Oil and gas projects near Sakhalin Island off Russia’s far-eastern coast have seen little impact from the tsunami triggered by a massive earthquake in Japan, supermajors operating in the region said.

Japan copper smelters shut on quake, raises supply concerns

(Reuters) - Japan's two major copper smelters shut down operations due to power outages in northern Japan areas hit by a powerful earthquake, raising concerns about supply disruptions if it takes a long time to repair the infrastructure.

US natgas rig count lowest in 13 mths-Baker Hughes

NEW YORK (Reuters) - The number of rigs drilling for natural gas in the United States fell this week to the lowest level in 13 months, dropping 17 to 882, oil services firm Baker Hughes said on Friday.

Think gas is expensive in Canada?

A litre of regular in Canada has been hovering around $1.30 in some parts and that’s cheap – at least compared to pump prices in the United Kingdom.

In Britain, a gallon of gas sells for £6, which translates to $9.40 in our Canadian currency. Converted to metric, this is comparable to paying $2.07 per litre in Canada.

Buick’s Gas-Saving Strategy

THE Energy Department calculates that 17.2 percent of a vehicle’s fuel is consumed when its engine idles in traffic, adding up to billions of gallons burned at stop signs and traffic lights and in urban congestion. Put another way, 69 cents’ worth of a $4 gallon is wasted by idling.

To minimize this inefficiency, automakers are adopting so-called stop-start systems that virtually eliminate idling by shutting off the engine when the car or truck comes to a complete stop, then instantaneously restarting it when the driver’s foot lifts off the brake (on cars with an automatic transmission) or engages the clutch.

Growing number of bike cafés gear up to serve cyclists

At bicycle cafés, travelers can stop for coffee, grab a bite to eat and get air in their tires or even a tune up, all at the same time. These cafés are proliferating across the country, enhancing the “in the saddle” experience for everyone from urban riders and hard-core cyclists to weekend warriors and tourists.

6 energy experts address the economic impact of Middle East unrest - by Richard Heinberg, David Fridley, David Hughes, Tom Whipple and Colin J. Campbell

With instability in the Middle East driving oil prices higher, huge cracks are widening in the global economy. In an effort to broaden the conversation about Middle East unrest and its impacts on oil prices and economies, the Post Carbon Institute offers six informed perspectives on what to expect in the days, weeks and months ahead.

Individuals, businesses and policy makers are made aware of the speed with which seemingly incremental price gains can topple global dominoes.

Nuclear association: Japan reactor being cooled

LONDON (Reuters) - The World Nuclear Association, the main nuclear industry body, said on Friday that it understood the situation at Japan's Fukushima plant after a massive earthquake was under control, and water was being pumped into its cooling system.

"We understand this situation is under control," an analyst at the association told Reuters.

French police clear oil depot after fuel protest

(Reuters) - French police cleared access to a fuel depot at Fos-sur-Mer on the Mediterranean coast after fisherman protesting over rising fuel costs blocked the site for several hours earlier on Friday, the local authorities said.

The fisherman, who are demanding government measures to offset an increase in fuel prices linked to a crude oil rally, prevented the loading of tens of fuel lorries at what is the largest depot in the southern French region of Provence-Alpes-Cote d'Azur.

Witnesses: Yemen forces open fire on protesters

SANAA, Yemen — Security forces opened fire on demonstrators taking part in protests throughout Yemen in what appears to be the biggest turnout in a month of unrest to demand regime change, eyewitnesses said.

In the southern port city of Aden, the witnesses say security forces shot at demonstrators trying rip down photographs of President Ali Abdullah Saleh. Six protesters were wounded, one seriously, one medic said.

Libyan military forces sock key oil port

Ras Lanuf, Libya (CNN) -- The military forces of Moammar Gadhafi on Friday pounded Ras Lanuf, the key oil port once in the hands of rebel forces, and its leadership confidently vowed the retake all territory from the opposition.

Pro-Gadhafi forces cranked up an intense and steady bombardment of the city, believed to be by rocket, artillery and tank fire. A refinery was hit and a storage tank is on fire. Huge plumes of thick, black smoke can be seen.

EU sanctions on Libya’s oil billions take effect

BRUSSELS — Multi-billion-dollar EU sanctions on Libyan leader Muammar Gaddafi’s regime came into force on Friday as European Union leaders argued over the next steps to force him from power.

The EU’s Official Journal said the sanctions froze five state vehicles holding billions in assets and investments said to be under Kadhafi’s family control.

New head for the IEA

Former Dutch Minister of Economic Affairs, Maria van der Hoevan, will be the next executive director of the International Energy Agency (IEA) said the agency today.

Hoevan will succeed Nobuo Tanaka of Japan who will serve until 31 August, completing four years of service.

Rosneft Defends BP Venture, Tells TNK-BP to Back Off

Russian state-controlled oil producer Rosneft said it is committed to the deal it struck with BP on an Arctic development and isn't in talks with TNK-BP Ltd. about replacing the U.K. oil major as a partner.

Fuel shortage compels KESC to increase load shedding hours

KARACHI: The Karachi Electric Supply Company (KESC) has to increase the duration of the fixed load shedding hours in the city as it has become impossible for the utility to maintain the present level of power supply in view of the erratic and significantly reduced gas supply and continuous oil price hike.

Joseph Tainter: talking about collapse

At the end of his monumental study titled “Decline and Fall of the Roman Empire” Edward Gibbon discusses the question of whether what happened to the ancient empire could happen in modern times, that in the late 18th century, when Gibbon was writing. His answer is that it could not; new hordes of barbarians couldn't destroy the civilized world because of gunpowder, cannons, modern armies and the like.

It is clear that Gibbon saw the Roman collapse as mainly a military event: the Romans were overwhelmed by one wave of Barbarians after the other. But, like many other historians before him, Gibbon chronicled events without normally interpreting them in the sense we give today to the term - that is finding social, economic or political reasons to explain what happened.

Gibbon, living in the thriving and expanding world of 18th century Britain, just couldn't see that there was much more in the Roman collapse than a simple military problem. It would take time for historians to see the collapse of the ancient world as something related to our own destiny. With collapse impending, or perhaps already started, we can start seeing that the Roman times are a foggy mirror of our times.

The Full Seas Act and the college of the 21st century

We just can’t have a perpetually growing population, perpetually growing consumption, or perpetually growing economy. To think there is no limit to growth on a finite planet (Earth comes to mind) is equivalent to thinking we could have a stabilized economy on a perpetually diminishing planet. In other words, we could gradually squish the $70 trillion global economy into one continent, then one nation, then one city… you get the picture. It’s becoming an “information economy,” right? So eventually we could squish it into your blackberry, leaving the rest of the planet as a designated wilderness area!

John Michael Greer: Conserving the differences

Nowadays, in a world where energy is no longer cheap and abundant, and is going to get a lot less cheap and abundant over the decades and centuries to come, we need to learn a new way to think about energy. Recognizing that energy is scarce and expensive is a good start, but it’s possible to go a bit further than that, and recognize that what you need to do if you want to work with energy – especially scarce, expensive energy – is to conserve differences in energy concentration.

US farmers fear the return of the Dust Bowl

There is not much to be happy about these days in Happy, Texas. Main Street is shuttered but for the Happy National Bank, slowly but inexorably disappearing into a High Plains wind that turns all to dust. The old Picture House, the cinema, has closed. Tumbleweed rolls into the still corners behind the grain elevators, soaring prairie cathedrals that spoke of prosperity before they were abandoned for lack of business.

Happy's problem is that it has run out of water for its farms. Its population, dropping 10 per cent a year, is down to 595. The name, which brings a smile for miles around and plays in faded paint on the fronts of every shuttered business – Happy Grain Inc, Happy Game Room – has become irony tinged with bitterness.

Decline of honey bees now a global phenomenon, says United Nations

The mysterious collapse of honey-bee colonies is becoming a global phenomenon, scientists working for the United Nations have revealed.

Japan's tsunami could hit economy hard

The government has reported that as designed, they are closing down automatically, but the economic effects can be gauged by from happened the last time there was a major earthquake in Japan, in September 2007, on the other side, the Japan Sea side, which closed down the largest nuclear power plant in Japan for more than year and a half. And so, Japan is highly dependent on these nuclear power stations. They may well have closed automatically and hopefully, there's no radiation problem, but the economic consequences of them closing, and we don't really know the damage yet, but from the 2007 example, these could be out of action for a very long time.

And for the world's second, third largest industrial economy, that's an extraordinary prospect to face.

Commodities, energy markets grapple with shutdowns after Japan quake

SINGAPORE (Reuters) - Japan's earthquake forced port closures and shutdowns of oil refineries and metal plants in the world's third-biggest economy on Friday, rattling commodity and energy markets as participants weighed up how quickly activity could return to normal.

US reactors are safe, NRC says after Japan quake

NEW YORK (Reuters) - U.S. nuclear plants, built to cope with the biggest earthquakes, are well prepared to withstand the kind that rocked Japan on Friday, the nation's nuclear regulator said.

Two U.S. nuclear plants along the California coast made preparations for a potential Pacific Ocean tsunami on Friday, but continued to operate normally.

Russia needs investment, geographical expansion to maintain oil production

MOSCOW (RIA Novosti) - Russia, the world's top crude producer, needs to pump billions of dollars into its oil industry and expand beyond the traditional oil area of West Siberia to maintain international leadership and reverse declining output, industry analysts say.

The global financial and economic crisis that spread to Russia in 2008 forced domestic oil companies to cut investment in the development of oil fields, which has resulted in oil output decline by 2-3% annually.

Hidden energy crisis in the Middle East

TEL AVIV - While most of the world is preoccupied with the impact of instability in the Middle East on oil prices and the world economy, a different kind of energy crisis is unfolding practically unnoticed. An ongoing reshuffle in natural gas supplies has left at least two countries - Israel and Jordan - without much of the gas they need.

In general, the politics of Middle Eastern gas will probably be just as dramatically affected by the upheaval as those of oil, but will follow a separate trajectory. Their effect will, at least initially, be more local in nature, and will vary for each country. However, the energy status quo in the region is slated to change dramatically.

Oil States: Are They Stable? Why It Matters

The shots that rang out in Brega, where this Libyan rebel patrolled a key refinery last week, truly were heard around the world—a world that relies on autocratic or troubled regimes of the Middle East and North Africa for one third of its oil.

Steve LeVine: No end to the Tunisian contagion and $100-plus oil prices

There's a presumption out there that things look tough in the Middle East, but that soon enough -- maybe by summer -- they will sort themselves out, and becalm the volatile prices of oil and gasoline. Not so, says veteran oil analyst Edward Morse, a student of history who correctly called the 2008 oil bubble while everyone else was still throwing money into the pot. "This is not a one-off disruption," Morse says. Instead, we're in a new age of geopolitical risk that threatens to disrupt the region for a decade or even longer.

Steve LeVine: The violent day before the dreaded Day of Rage

Today is a scheduled "Day of Rage" in Saudi Arabia. Organized on the Internet, the protest had been expected to be a likely dud. Now it might be different.

Will Political Turmoil Collapse the Old Oil Order?

The political turmoil in the Arab world may not only lead to much higher oil prices, but greater competition for resources and a shift in priorities for oil-producing nations. So says the author of Rising Powers, Shrinking Planet.

What’s happening in North Africa and the Middle East, says Michael Klare, is the collapse of what he calls the “Old Oil Order.”

Eni Chief Scaroni Warns of Risk That Libya Could Turn Into a Failed State

“What would be the worst potential outcome is to have a kind of Somalia situation in Libya that has no government for a long period of time,” Chief Executive Officer Paolo Scaroni said in an interview with Bloomberg Television late yesterday. “But if this happens, this will not just be Eni’s problem. It will be a problem for Europe, for everybody.”

Coping with the drop in oil supplies

It is not surprising that tensions in North Africa and the Middle East have dominated the discussion at this year’s CERAweek annual oil and gas conference. The general view is that, as of now, the world can easily cope with the drop in supply. Dan Yergin, chairman of CERA, the consultancy hosting the conference, told FT Energy Source: “This is a manageable disruption.’’

But many fear the situation will get worse before it gets better. And there is widespread uncertainty about how the situation will evolve.

Russia's clout rises with oil prices

With the price of oil climbing to more than $100 a barrel, Russia has a little more weight to throw around on the world stage, and is doing just that.

The stepped-up flow of petro-dollars into the government's coffers relieves what had been a worrisome budget deficit and lessens the urgency of reform. Good relations with the West - and especially the "reset" with Washington - are not quite so pressing when the economy is in good shape.

Qatar set to power further ahead

DOHA // Qatar's new energy and industry minister thinks the emirate's oil and gas sector can become an even greater global force.

But a lack of immediate development prospects in its "upstream" oil and gas extraction sector could present a problem.

Saudi oil customers seek steady supply

JEDDAH: Although the global oil market is facing supply disruption due to unrest in Libya, fellow OPEC member, Saudi Arabia is expected to keep its contracted oil supply volumes to most customers in Europe unchanged in April from March.

"Aramco had communicated with us about additional supplies but we have not explored that option. We did not ask for more because we do not need any more Arab Heavy barrels," Reuters quoted one European customer, who asked not to be named. "There will be no change in our allocation from March."

Problems facing country worsening, warns ex-FM

Pakistan’s dissenter former foreign minister Shah Mahmood Qureshi yesterday presented a virtual charge-sheet against the government of his own Pakistan People’s Party (PPP), saying that a poor law and order situation, the energy crisis, food inflation, dictation from foreign donors, bad governance and rampant corruption in every department had ruined the life of ordinary people.

America Facing Crude Awakening

I share the hope of living long enough to drive a fuel cell automobile. I think it's a great idea because I don't want my petro-dollars going to people who hate us and wage jihad against us. But I don't expect that's going to happen in the next five years and the "next energy crisis" is here and now.

That's why it is so disappointing that Obama has done nothing to accelerate exploitation of our own domestic energy sources or build more nuclear power plants. He doesn't breathe a word about American energy independence. He can't say the words "clean coal," though the technology exists today.

How Can Average Americans Lower the Price of Oil in Half?

The next important step is to hold the U.S. Congress and White House responsible for lowering the price of gas to two dollars a gallon. This will spur growth and create jobs as businesses begin to expand. How can we accomplish this simple goal of $2 a gallon gasoline?

Write U.S. Senators and demand they make an immediate plan to lower gas prices to $2 a gallon by the end of April or they will no longer be employed come election time.

China May Boost Spot LNG Purchases This Year, JPMorgan Says

China will boost spot purchases of liquefied natural gas this year as the country’s terminal capacity increases and term contracts start in 2012, said JPMorgan Chase & Co.

Natural Gas, Scrutinized, Pushes for Growth

“Really, the future for the commodity has never been brighter,” said David Blackmon, the chairman of the Texas state committee for America’s Natural Gas Alliance, which organized the Kenedy meeting. Already Texas produces close to one-third of the natural gas in the country, and Mr. Blackmon’s organization is eyeing ways to increase utilization of the fuel, in power generation and in fleet vehicles.

Yet the state’s renewed commitment to gas comes at a time of sharply increased scrutiny for the gas industry. Gas burns more cleanly than coal, its chief rival in electricity generation. Gas prices have also been low in the past few years, which is good for the power and home-heating sectors and manufacturers like fertilizer plants that also use it.

Analysis: European Unconventional Gas Could Rival North America

The size of European unconventional commercial gas reserves rival that of North America, according to a major new study by IHS Cambridge Energy Research Associates (IHS CERA). The study, Breaking with Convention: Prospects for European Unconventional Gas estimates Europe's total unconventional gas in place could be 173 trillion cubic meters (Tcm), or 6,115 trillion cubic feet (Tcf).

Pressure Rises On Shale Gas

Concerned about environmental damage, a pair of Canadian provinces have stepped up scrutiny of two unconventional means of extracting fossil fuels from the ground.

Quebec halted shale-gas extraction, while Alberta ordered tests on the environmental effects of the country's vast and growing production from its oil-sands deposits.

In Pinedale, Wyo., Residents Adjust to Air Pollution

The upper Green River basin in southwest Wyoming has polluted-air days for a combination of reasons: its geography, in a valley at 7,000 feet; its typical winter weather that produces sun on highly reflective snow; and its economy, heavily based on natural gas drilling, which scientists say produces smog’s underlying chemical base.

Mthombo: A white elephant in the making

South Africa's national oil company, PetroSA, is pushing hard for Cabinet to approve its “Project Mthombo”, a new oil refinery to be built at Coega in the Eastern Cape.

But it is now widely acknowledged that the world has reached “peak oil”, the time when global oil supplies can no longer rise to match demand. In a future of declining oil supplies and rising prices, Project Mthombo would become the country's biggest white elephant -- one that it can ill afford.

Land Locked: U.S. Wilderness Protection Act Benefits the Climate--Hunters Like It, Too

Whereas the 2009 law's language does not address global warming, environmentalists are overjoyed at the climate benefits protecting so much land will bring. As such, it is one of the most significant expansions of U.S. wilderness protection in the past quarter century.

State losing jobs by delaying energy projects

California could be losing billions of dollars and thousands of jobs by dragging its heels on energy projects, according to a report released today by the U.S. Chamber of Commerce.

Should West Help Oil States Kick the Oil Habit Too?

As countless lessons in history have taught us, one thing that fledgling democracies can ill afford is a sudden economic shock or cultural upheaval. If we start to wean ourselves off oil, isn't there a danger we leave the reformed yet still forming new powers-that-be in the Middle East hanging without a lifeline?

Can thorium clean up nuclear energy?

So far Lightbridge is the only US firm experimenting with thorium, and there’s no government-funded program to develop it. But other countries (and their governments) are interested in thorium’s promise.

Economic forces drive transition from fossil fuels

Economic forces, such as oil priced above $100 and finite energy resources, will continue to drive the adoption of energy efficiency and non-fossil fuel energy technologies despite a partisan debate that has led to a stalemate in U.S. energy and climate policy, speakers at the eighth annual Green Energy Summit said Thursday.

Fears for a Big Australia

It seems the Immigration Department has very good reason to know that none of the levels of immigration or work-force growth it has recently pursued are either responsible or compatible with a sustainable population. This emerges from Long-Term Implications, a significant report which the Immigration Department commissioned and funded but is now trying to discredit.

Richard Heinberg: Earth's limits: Why growth won't return - food

Industrial societies have skirted what would otherwise have been limiting factors to food production using irrigation, new crop varieties, fertilizers, herbicides and pesticides, and mechanization—as well as expanded transport networks that allow local abundance to be shared globally. In terms of productivity, 20th century agriculture constituted an unprecedented story of success: grain production increased an astounding 500 percent (from under 400 million tons in 1900 to nearly two billion in 2000). This achievement mostly depended on the increasing use of cheap and temporarily abundant fossil fuels.

Will Water Set the World on Fire?

It is then clear that a majority of the world's population is quickly losing its access to adequate water supplies necessary for maintaining production and consumption, and will therefore fall deeper into sickness, hunger and bloody warfare. Although the financial elites in power are most likely aware of these trends and their implications, it is still a situation unlike any other they have ever encountered in history. Destruction of water ecosystems in India and China, along with the tense dynamic between India and Pakistan, reflect irreversible environmental trends that will unfold in a very chaotic, non-linear manner, and the ensuing outcomes will be largely outside of the control of financial power elites.

Oil Plunges as Japan's Refiners Shut Plants After Earthquake

Oil fell below $100 a barrel in New York for the first time in more than a week after Japan’s strongest earthquake in at least a century forced refiners to shut several processing plants.

U.S. crude futures were headed for their first weekly decline in a month following the temblor in the world’s third-largest oil user. A fire at Cosmo Oil Co.’s refinery in Chiba, outside Tokyo, is spreading, a Fire Department spokesman said. JX Nippon Oil & Energy Corp. closed refineries in Sendai, Kashima and Negishi. In London, Brent crude was set for its first weekly decline in seven.

Japanese Quake Forces Evacuation Near Nuclear Reactor; Oil Refinery Burns

Residents near a Tokyo Electric Power Co. nuclear reactor were ordered to evacuate because of a possible radiation leak as Japan’s strongest earthquake in a century shut power plants and oil refineries.

Japan trying to fix nuclear plant cooling problem

(Reuters) - A cooling system for a nuclear reactor was not working after a powerful earthquake in Japan, prompting the government to declare an emergency situation as a precaution although it said there was no radioactive leakage at present.

Residents that live within a 3 km radius of Tokyo Electric Power's Fukushima Daiichi nuclear plant have been told to evacuate, Japan's Chief Cabinet Secretary Yukio Edano told a news conference.

Good Graph Friday: The energy we consume

Skyrocketing gas prices have shocked Americans. So, what is the breakdown of energy source consumption? Solar power? 1%. Petroleum: 37%.

Stolen Oil: A Gusher of Cash for Mexican Drug Cartels

In the early hours of a frosty February morning, a resident in the Central Mexican town of Amozoc heard suspicious noises in the field near his house. He called for help. When the state agents arrived, they found a truck trying to leave the area — with a whopping 5,000 gallons of crude oil in the back. The three men on board had drilled a hole into a major oil pipeline that runs through the town and sucked the fuel into their truck through a hose. Worst of all, the alleged culprits were town policemen.

Such oil theft has become increasingly common in Mexico amid a breakdown in law-and-order in certain states. Last year, the government oil monopoly Petroleos Mexicanos or Pemex detected 712 such pipeline taps — a fivefold increase compared to the 136 spotted in 2005. It represents a significant loss of government income at a time when revolution in the Middle East has pushed crude oil prices to nearly $100 a barrel. (The Amozoc haul would be the equivalent of about 120 barrels or roughly $12,000.) Adding to the alarm, detectives working on several cases have traced the thefts to drug cartels, such as the Zetas, an indication that the country's overlords of crime have branched out into yet another line of business.

Oil keeps flowing to China and EU

European and Chinese companies continue to buy oil from Libya, benefiting Muammer Gaddafi’s regime with hundreds of millions of dollars even as western powers impose financial sanctions aimed at forcing Libya’s leader from power.

Dialogue is the way forward: Saudi minister

RIYADH — Dialogue, not protest, is the best way to bring about change in Saudi Arabia, Foreign Minister Prince Saud Al Faisal said on Wednesday as the country braced for possible protests in the world’s top oil exporter.

Saudi Arabia protests could be calamitous for oil market

Saudi Arabia is synonymous with oil. Its massive reserves provide 90% of the country's revenues and 40% of its gross national product. More important still, the kingdom has historically been the world's largest producer and exporter of oil, a market fulcrum without which global energy markets would be thrown into turmoil.

Ex-CIA Chief Says Saudi Arabia Is Vulnerable

I spoke with Woolsey about his experience behind the wheel of the Volt, political unrest in the Middle East, and the current price of oil. He believes the Volt is a major success, and sees widespread adoption of (and conversion to) plug-in hybrids—especially if running on biofuel—as an effective strategy for alleviating our vulnerability to oil price shocks. "If new cars had that, they don’t need to be all electric," Woolsey said. "Three-quarters of the cars in the country go less than 40 miles a day."

Moreover, Woolsey believes that it's "quite possible" that the recent political unrest in Egypt, Tunisia and Yemen could reach Saudi Arabia, with profound impacts on global oil markets.

Saudi police deploy ahead of planned protests

(AP) RIYADH, Saudi Arabia - Hundreds of police deployed in the Saudi capital Friday ahead of planned protests calling for democratic reforms as the government tried to prevent the wave of unrest sweeping the Arab world from spreading in the oil-rich kingdom.

Police blocked roads and set up random checkpoints in Riyadh, searching residents around a central mosque as large numbers of people gathering for Friday prayers raised the prospect of them later spilling into the streets for mass demonstrations.

Gulf Arab Ministers Try to Buy Quiet With Aid Dollars

Foreign ministers from the six-member Gulf Cooperation Council pledged $20 billion in financial aid in Bahrain and Oman on Thursday, the Associated Press reports. Growing protests in Bahrain and Oman have shaken the other members of the GCC, raising concerns the political earthquake rocking the Middle East will affect key OPEC members. Global oil prices have already spiked due to unrest.

Libya Fighting Centers on Oil Fields as NATO Mulls Action

Libyan forces loyal to Colonel Muammar Qaddafi drove rebels from the Mediterranean oil hub of Ras Lanuf as anti-regime forces said they will seek to secure oil regions in Africa’s third largest producer.

S&P cuts and suspends Libya ratings

CAIRO – International ratings agency Standard & Poor's on Thursday downgraded Libya's sovereign rating to junk status and suspended its ratings for the country. Also, the rebel-led government in the nation's east said it would honor existing contracts with international oil companies.

The twin developments spotlighted the challenges confronting an oil-rich nation that just weeks ago was well on the path to redemption after enduring years of sanctions as a pariah supporter of terrorism.

Eni's Libyan oil production near complete halt

The chief of Eni, the biggest gas exporter from Libya, said Thursday that oil production across the battle-torn country is near a complete halt and that the Italian company's output is down to little more than supplying power to Libyan households.

Estonia's state power firm in US oil shale deal

TALLINN, Estonia (AFP) – The state power firm of Estonia, a Baltic nation that all but covers its energy needs using oil extracted from shale, said Thursday that it was taking over a major US shale-sector player.

Rising Oil Prices Create Political Cushion for Iran

The sudden rise in oil prices amid uncertainty and upheavals in the Middle East could create a political cushion for Iran. Prices are likely to remain high and volatile as long as protests, and concerns about supply disruptions, continue across the region. The global economy has limits on what prices it can handle. But Iran will clearly benefit multifold from higher prices, especially given its own economic problems.

Saudis Key to Securing Oil During Unrest

HOUSTON -- A former U.S. ambassador to five Middle East nations said March 9 the United States should stand by its traditional friends in the region to secure oil supplies.

Ryan Crocker, who served as U.S. ambassador to Iraq, Pakistan, Syria, Kuwait and Lebanon, said Saudi Arabia is key to stabilizing markets with its 3.5 million barrels per day of excess capacity.

Woe betide world's oil users if Saudis aren't talking true

The big question is whether the spare capacity story is true. For many years, doubts have been raised about the ability of OPEC to keep raising production to meet global demand as the old super giant fields – among them the North Sea, Mexico’s Cantarell and Alaska’s Prudhoe Bay – go into terminal decline. OPEC has met the challenge, with a little help from its non-OPEC friends. Canada, thanks to the Alberta-munching oil sands projects, has turned into an export middleweight. After decades of decline, U.S. production is up by more than 10 per cent since 2007 because of the prolific Gulf of Mexico and clever new exploration and drilling gizmos.

Saudi Arabia’s ability to act as the swing producer forever, however, is open to question. Six years ago, Matt Simmons wrote a book called Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy. Using as much technical information as he could find – Saudi Arabia’s oil reserve data are notoriously opaque – he warned that some big Saudi fields were in decline and that peak production might be dangerously close.

Kissinger throws cold water on Mideast optimism

HOUSTON (CNNMoney) -- Former Secretary of State Henry Kissinger delivered a sobering analysis on the unrest sweeping across the Middle East Thursday, telling leading energy industry experts that the recent protests may not pan out as smoothly as some hope.

Algeria eyes huge domestic shale gas reserves

HOUSTON (Reuters) - Oil and gas producer Algeria is sitting on huge reserves of shale gas that it now intends to develop with the help of international partners, the OPEC member's energy minister said on Wednesday.

The African nation of Algeria, already a major exporter of oil and natural gas, could become an even bigger exporter in the coming years as it develops up to 1,000 trillion cubic feet of natural gas trapped in shale rock more than 1,000 meters (3,280 feet) below the surface.

A fear of fracking may slow natural gas trend

Natural gas could be a major source of low-cost electricity nationwide, as an upsurge in domestic production drives costs down and looming environmental mandates encourage utilities to retire power plants that run on dirtier-burning coal.

But energy experts and executives at the CERAWeek conference in Houston on Wednesday described a landscape of obstacles still standing in the way of natural gas producers. Chief among them: public fears about water contamination from the hydraulic fracturing process that is essential to unlocking natural gas in U.S. shale formations.

Nexen eyes Gulf of Mexico drilling permits in 2Q

HOUSTON (Reuters) - Nexen Inc hopes to see permits issued in second quarter for appraisal drilling at Appomattox in the U.S. Gulf of Mexico, Nexen's chief executive said on Wednesday.

"I think we still do have a shot at getting licenses, potentially in the second quarter," Marvin Romanow, Nexen's president and chief executive, told Reuters on the sidelines of the 2011 CERAWeek conference.

BP CEO apologizes to oil industry for Gulf spill

HOUSTON — BP PLC chief executive Bob Dudley opened a speech to a major oil industry conference in Houston with an apology to the industry for the Deepwater Horizon disaster that killed 11 workers and led to a halt to deepwater drilling in the Gulf of Mexico.

Addressing the CERAWeek conference, Dudley assured BP is working to prevent a recurrence of last year's explosion and oil spill.

Analysis: U.S. offshore drillers still reeling from spill

(Reuters) - Oil drilling in the deepwater Gulf of Mexico is still stuck in neutral even after U.S. regulators last month issued the first new drilling permit since the deadly 2010 Macondo well blowout.

Nearly a year after BP Plc's mile-deep Macondo well ruptured in April 2010, triggering an explosion aboard the Deepwater Horizon drilling rig that killed 11 people, executives at the high-profile CERAWeek energy conference in Houston marked few reasons for optimism about a recovery of drilling in the Gulf.

Crying wolf? Oil companies that fought the drilling moratorium will survive

So while the Macondo spill left its mark on the players involved, namely BP and Transocean, the firms most responsible for the mess, and the ensuing moratorium hurt many others in the oil industry, drilling is back. Oil prices are high, and demand doesn't seem to be going away. Companies that have made it this far will likely be fine -just as soon as they get the permits to drill.

Pa.'s attempts to track gas drilling waste flawed

The natural gas industry's claim that it is making great strides in reducing how much polluted wastewater it discharges to Pennsylvania rivers is proving difficult to assess because of inconsistent reporting by energy companies — and at least one big data entry error in the state's system for tracking the contaminated fluids.

Scrapping the fuel duty rise will hurt Britain economically

A small fuel duty increase means less consumption. The Green party wants to ease the strain by scrapping the VAT rise.

US Republicans assail Obama as gas prices rise

WASHINGTON (AFP) – US President Barack Obama's Republican foes on Thursday blamed his energy policies and efforts to combat climate change for soaring oil and gasoline prices and called for boosting domestic production.

Ten Don’ts for Our Government on Gas Prices

As gas prices in the United States continue to soar, policymakers in Washington are eager to point fingers and offer solutions. Most of the ideas are not new, and some are certainly much better than others, but they will inevitably be part of the debate. As legislators turn their attention to gas prices, here’s a straightforward list of what not to do.

Oil prices soar in spite of sharp increase in U.S. production under Obama

Domestic oil production is soaring, but so are global prices. It should be obvious that yet more drilling can’t have any significant impact on oil prices — particularly since the U.S. Energy Information Administration has been making that precise point for years now.

House Republicans to push series of energy bills

WASHINGTON (Reuters) – Republicans in the House of Representatives said on Thursday they would seek to combat rising oil and gasoline prices with a series of bills this year aimed at spurring domestic energy production.

Oil at $100 Kills Brain Cells, Impairs Logic

It must be the noxious fumes or the stratospheric prices because crude oil crossing the $100 threshold makes normally thoughtful individuals funny in the head.

The early symptoms of high oil price syndrome, or HOPS, can easily be masked or confused with a more generalized form of lazy economic thinking.

When We Demand Cheap Gasoline, We Are Demanding Disaster

There are four major symptoms to my addiction and yours, and in 2011 they are all getting worse.

Making Every Oil Calorie Count

AS turmoil in Libya pushes up the price of oil, American consumers are once again feeling the sting of $3.50-a-gallon gasoline. But the impact of costly crude on our lives and economy extends far beyond the pump. Virtually everything we consume — from hamburgers, running shoes and chemotherapy to Facebook, Lady Gaga MP3s and “60 Minutes” — is produced from or powered by fossil fuels and their byproducts, all of which could grow more costly as the price of petroleum rises.

The problem is that there is no easy way to quantify how much total energy we consume. Fortunately, there’s a great model already in widespread use: the nutritional information that appears on the back of every food product. Why not create the same sort of system for energy?

Budget hawks: Does US need to give gas and oil companies $41 billion a year?

Desperately seeking fiscal savings, Congress and President Obama are scrambling to find anything in the federal budget that can be thrown overboard, from child nutrition aid to funding for military bands.

But the American people might be on to something. In a poll conducted for NBC and the Wall Street Journal, three-quarters of respondents favored "eliminating tax credits for the oil and gas industries."

U.S. gas prices are a joke ... in Norway

NEW YORK (CNNMoney) -- Americans often fret about the price of gasoline, which has surged dramatically in recent days, fueled by turmoil in oil-producing nations in the Middle East and North Africa.

But the price of gas in America lags far behind its European counterparts. While Americans tear their hair out at the pump, Europeans watch them enviously from across the Atlantic.

Save fuel, save lives with these proven gas-saving tips

Don't warm up the engine by idling awhile before driving. That used to be the rule, but modern cars don't need it and can suffer from it. Just drive a bit gently at first to warm the oil and get it circulating properly.

Opponents of oil drilling win reprieve for northern Norway

Oslo - Opponents of oil drilling in pristine sea areas off northern Norway won a reprieve Friday, when the government said it would not allow test drilling off Lofoten and surrounding areas.

Prime Minister Jens Stoltenberg said at a news conference it was a good compromise for the country that would offer a "balanced" approach to oil, gas, fisheries and the environment.

Sen. Rand Paul slams administration over toilets, light bulbs

Sen. Rand Paul, R-Ky., lambasted the Energy Department today, saying the agency forces Americans to buy toilets that don't flush properly and light bulbs they don't want in the name of energy efficiency.

Why do conservatives hate trains so much?

Amtrak passengers pay more of the cost of their transportation than do drivers on the interstate. About 62 percent of Amtrak's operating expenses, according to the Department of Transportation, comes from fares. According to the Federal Highway Administration, the percentage of highway spending paid for by users — in the form of gas taxes and tolls — is headed below 50 percent.

How high-speed rail could help the U.S.'s aging infrastructure

I think there are two major costs. If you look at our infrastructure, it's aging. Recent estimates say it's costing us $200 billion a year. If you look at things like trucks, just sitting in traffic. So that's a long-term cost in terms of our bridges, our water, our energy. But the other part of is it we need to start dealing with creating a new infrastructure that really gets around this whole issue of congestion, and high-speed rail is part of it. Unless you want to be building airports everywhere.

GM doubling output of Chevrolet Volt as gas prices rise

General Motors now plans to more than double its production of the Chevrolet Volt extended-range electric car.

And GM is adding a second shift and 1,000 jobs at the Michigan plant where the plug-in car is made.

New York Transportation Chief Defends Bike Lanes

“When you put these bike lanes down, you are improving the safety of everyone who uses that street,” Ms. Sadik-Khan said. (She spoke specifically of lanes separated from vehicular traffic by a buffer.) “The safety gains that you get are really unmatched with any other type of treatment.” But in a sidelong reference to recent travails, Ms. Sadik-Khan conceded that redesigning streets could be “painstaking work.”

China Congress Pushes Gas, Nuclear Over Coal in Energy Plan

China, the world’s biggest polluter, said it would accelerate its use of renewable energy and cleaner-burning fuels including natural gas over the next five years to cut pollution and reduce reliance on coal, which generates about 80 percent of the nation’s electricity.

Saudi Arabia embraces solar energy

YANBU // Saudi Arabia wants to meet its two fastest-growing needs - jobs and electricity - by making the materials used to absorb power from the sun.

The government hopes to create up to 15,000 jobs in the next decade by nurturing a solar industry, from solar farms to assembly plants, to factories that make raw materials.

Showdown on Vermont Nuclear Plant’s Fate

WASHINGTON — The Nuclear Regulatory Commission on Thursday rejected all challenges to extending the operating license of the Vermont Yankee nuclear plant, setting up a confrontation between the reactor’s owner and the Vermont Legislature, which has blocked a state certificate needed to keep the plant running.

Restaurants feel bite of higher food costs

He said the price of gasoline, up about 40 cents for a gallon of unleaded regular in Galesburg in the past three weeks, has had a trickle-down effect on everything.

“The last time gas prices took this big a jump, the economy in general shut down,” he said. “It really makes people think twice about going out to eat.

“I’m just hoping it’s short term. What short term means, whether it’s a month or a month and a half, I don’t know,” Lieber said.

Why World Food Prices Will Keep Climbing

What began in the ’70s as a dream, the idea of using idle farmland to diminish dependence on oil, quickly became a nightmare, as political influence made it increasingly hard to shift production back to feeding the world. World fuel ethanol production has tripled since 2004 to more than 21 billion gallons; in the U.S., the share of grain production dedicated to fuel ethanol production doubled over the last four years to 28.7%.

Hawaii as a Microcosm in the Study of Peak Oil

It appears everyone understands the problems, with even the Republican candidate for Governor in last fall’s election trumpeting his commitment to a green economy for the island state. On the surface, it appears all the pieces are in place for a transition, but how will the state overcome its inertia and existing infrastructure?

The Peak Oil Catastrophe-In-Waiting

The United States continues to slumber while a catastrophe lies in wait. Increasing numbers of analysts and policymakers are warning of another super price spike for oil and the likelihood of "peak oil" more generally.

A success that looks like failure

The West’s long run as top dog may be ending. But the values that made it great, consumerism included, have been sold on to the rest of the world.

House Panel Votes to Strip E.P.A. of Power to Regulate Greenhouse Gases

WASHINGTON — A House subcommittee voted on Thursday to strip the Environmental Protection Agency of its power to regulate greenhouse gases, chipping away at a central pillar of the Obama administration’s evolving climate and energy strategy.

Electric dreams must step off the gas

When you boil down the carbon price debate, a big chunk of Australia's greenhouse gas emission cuts this decade is meant to come by way of a switch from coal-fired power stations to gas. Start with the oldest, dirtiest brown coal-fired plant and, in an orderly way, progress through the fleet until either we are no longer burning coal to generate electricity, or carbon capture and storage is up and running (and pigs are loaded and ready for take-off).

Sydney could be swamped warns climate expert

Sydney could be swamped by sea waters once a year, instead of once every one hundred years, if nothing is done to address climate change.

Study Says Navy Must Adapt to Climate Change

A report commissioned by the United States Navy concludes that climate change will pose profound challenges for the sea service in coming decades, including a need to secure Arctic shipping lanes, prepare for more frequent humanitarian missions and protect coastal installations from rising seas.

The 15-month study, conducted by the National Research Council, accepts the scientific consensus that the climate is changing and that the effects are being felt now. Of particular consequence to American naval forces – the Navy, Marine Corps and Coast Guard – are the melting polar ice cap, rising seas and increasingly frequent severe storms and droughts that could lead to famine, mass migration and political instability.

The OPEC Monthly Oil Market Report is out this morning. There were some big changes. But there were more changes, revisions, in the January data than in the New February data.

	       Algeria	Angola	Ecuador	   Iran	  Iraq	    Kuwait1
February	1,261	1,704	   475	  3,663	  2,638	    2,368
Before Rev.	  -15	   86	    -6	      5	    -68	       14
Revised	           -2	   53	    -3	     10	    -20	       28

                Libya	Nigeria	Qatar	Arabia 	Emirates   Venezuela	OPEC 12
February        1,347	2,098	811	8,869	2,394	   2,391	30,016
Before Rev.      -227	  -74	-2	  436	   19	     135	   299
Revised          -232	  -83	 1	  280	   23	      57	   110

All OPEC was up only 110,000 barrels per day after the January data was revised but before the revisions were figured in OPEC was up almost 300,000 bp/d. Saudi Arabia's January data was revised up by 156,000 barrels per day and their December data was revised up by 100,000 barrels per day. I think this ties in with what Goldman Sacks said about Saudi producing more than they claimed. In other words every OPEC nation is cheating on their quota but Saudi is cheating far more than they are reporting. The article link is posted up top: Woe betide world’s oil users if Saudis aren’t talking true

Earlier this week, the oil analysts at Goldman Sachs accused the Saudis and the other cartel members of, in effect, fudging their output figures. “We believe that Saudi Arabia has been producing 0.5 million to one million barrels a day above the official numbers since November ... implying that OPEC spare capacity is significantly lower than reported,” they said.

This ties in with what OPEC said this morning: Oil Supplies Could Fall in Second Quarter on Outages, OPEC Says In other words OPEC is now producing flat out so as they take maintenance outages in the second quarter there will be shortages.

Ron P.

If there is any topic that is more ignored in the MSM than "Net Export Math" (focusing on annual volumes), it's the post-2005 CNE (Cumulative Net Export) depletion rate.

Here are recent Saudi net export data versus US annual spot crude oil prices (EIA):

2005: 9.1 mbpd & $57
2006: 8.4 mbpd & $66
2007: 8.0 mbpd & $72
2008: 8.4 mbpd & $100
2009: 7.3 mbpd & $62
2010: 7.4* mbpd & $79


Post-2005, the Saudis (net) exported a total of about 14.4 Gb through 2010. As I frequently point out, if they had simply maintained their 2005 annual net export rate of 9.1 mbpd, they would have shipped 16.6 Gb.

But let's do some "Cowboy Integration." The area under a net export versus time graph is the total volume of net exports. Net export declines tend to show a triangular pattern, and we can approximate the total volume of post-peak net exports by multiplying the peak net export rate times the number of years of net exports remaining, times 1/2.

Sam Foucher's most optimistic projection is that Saudi Arabia will approach zero net oil exports around 2036, which is 31 years of net exports, post-2005, which implies post-2005 CNE on the order of 50 GB of oil. So (rounding off), 14 Gb of post-2005 CNE through 2010 would be about 28% of post-2005 Saudi CNE, a post-2005 CNE depletion rate of about 7%/year.

Sam's most optimistic projection is that Saudi Arabia, Russia, Norway, Iran and the UAE will have shipped half of their combined post-2005 CNE by the end of 2014. This is a projected (2005) top five post-2005 CNE depletion rate of about 8%/year.

Some observed post-peak CNE depletion rates:

Indonesia (Peak + 3 years), 31%/year;
UK (Peak + 2 years), 38%/year;
Egypt (Peak + 4 years), 19%/year.

MSM has only two modes:
complacency and OMFG-the-tsunami-just-hit!

which implies post-2005 CNE on the order of 50 GB of oil.

If that is optimistic, it's twilight in the KSA desert soon.

WTI retreating to $100 range today despite KSA unrest, net export info, dang speculators

I suppose some of the retreat is due to the disaster in Japan. One refinery is on fire and I would imagine that much of Japan would be shut down for days. People will be staying home, far less driving and far less oil used by industry. However that is only my speculation.

Ron P.

Saw brief pictures of what looks to be a fire storm burning through an area of northern Japan.

Maybe the Earth will swallow us whole before we do too much more damage.
Seems pretty devastating from the pictures on the nytimes.


The official Kyodo News Agency reported that about 88 000 people were missing after a tsunami triggered by the quake swept away houses, farmlands and vehicles.

Up to 300 bodies were found in the beach of Sendai, the closest city to the epicenter of the quake. The city has a population of 74 000.

A large waterfront area near the city is on fire. Houses and other buildings are also ablaze near the Kesennuma city in Miyagi prefecture, near Sendai.

Unbelievable. I saw it last night. I wonder about insurance losses. Natural disasters are the constant force of entropy which we used our oil wealth to fight against in the past.

The quake caused a selloff in global stock markets, led by sharp drops in insurance companies.

Store shelves emptying in Tokyo

US stocks up a bit. Do some traders smell an opportunity here?

US stocks up a bit. Do some traders smell an opportunity here?

If you consider global oil consumption to be a zero sum game, then a major economy being taken down a rung is advantage to the others.

EOS - And when that consuming nation ramps up it's energy imports to rebuild itself where do prices and other economies go? I can't think off another country more capable of writing that big check tomorrow than Japan. Considering that all infrastructure capital can be correlated to X units of energy how many additional millions of bbls of oil will Japan need to recover? Won't happen tomorrow of course. But a year from now? And if they did lose a significant portion of their refining capabilities...how will prices of exported products react? I doubt prices will fall in Asia if Japan ramps up product imports. And then where will China go to make up their fuel that Japan outbids them for? Yep - lots of cars won't be running now due to the damage. And when they ramp up auto production to replace those cars how much energy/commodities will that suck out of the market place? This wasn't some 3rd world rat hole that can't afford to buy its way back to recovery as fast as possible IMHO.

All just pure speculation, of course.

The Japanese are experts at emergency relief and rebuilding. They know what it's like to be wiped out and recover. Having said that, could the stock jocks just have a moment of silence for one minute before they start figuring out how they can make money off other people's pain?

They did, and one minute is all you get.

Thank you, tstreet.

re: one moment of silence.

Rock, you are correct that short term and medium term effects may differ. Also if worldwide refining capacity is short, I would expect that to depress oil prices but increase the price of refined products. So it could get pretty complicated. Also it is expected that Japanese Nukes may not be turned back on for months, and they will try to make up the shortfall with fueloil.

The problem for Japan is that their debt from fighting deflation for 20 years is about the highest of all the OECD countries and is approaching 200% of GDP. In other words, where will the money come from?

Well, I think they largely owe that money to themselves. So they'll just borrow more from themselves.

I know . . . that sounds silly. But the point is that the Japanese seem willing to fund their own debt at low interest rates. As long as they have an economy that is exporting stuff and bringing in money, they'll just tighten their belts a bit and invest.

The Japanese government has been trying to get the people to increase their domestic spending but this is a terrible way of doing that!

Someone on CNBC reported that total global insurance losses, with the first quarter not over yet, already exceed the total estimated losses for all of 2011.

Too big to fail. So, we must bail....them.
Sorry, I just don't find rhymes too much, had to say it.

Not a revelation on my part to be sure - more of just an observation after reading that natural disaster costs in the US passed a $$ billion last year - but in quite the ironic turn (or maybe some would argue poetic justice) it certainly appears that Mother Nature is making the best of her final opportunity to bat in the bottom of the 9th... and the earth itself - that all important entity so purposefully ignored in the economic constructs of man, may well be thing that doesn't just push but vehemently kicks us over the cliff...

There is no way our civilizations can continue to afford the monetary or energy inputs necessary to clean up and rebuild as these seemingly relentless occurrences impact an increasingly fragile globalized economy.

BP Spill cost ? - 20 Billion - Total cost ???

No insurance costs when the change the laws to ignore the actual damage to the fisheries and coastlines.

Very clever are these laws to hide environmental damage -- the entropy some choose to ignore that eventually starves us of farmland and food from the oceans.

Bottom of the 9th?

I'm thinking some think the game is baseball - I'm going with baseball bats - but used on kneecaps.

Oops, You probably meant to type 2010 not 2011.
The Kobe earthquake was the world's most costly natural disaster at $100B, this will likely exceed that sum. I sure hope that figure of 88000 missing is bogus! The quake was some distance offshore, so I would think they were spared the strongest shaking. Hopefully most of the damage is confined to tsunami hit areas.

I think that the CNBC guy said 2011, but I should have said "projected losses for 2011."

He may have said, "Catastrophe losses for 2011 year-to-date have exceeded catastrophe losses for all of 2010".

In the insurance industry, certain events are tagged as "catastrophes", and their claim dollars (called "losses") aggregated. A hurricane (or other major event) will get a "Catastrophe number," and each insurance company will summarize its claims under that catastrophe number and report the total amount to a statistical agency.

Insurance people estimate what the total claim amounts will be on recent catastrophes (including I would guess the Japanese earthquake). So it is theoretically possible that catastrophes to date for 2011 have exceeded catastrophes for all of 2010, mostly because the Japanese earthquake catastrophe looks so big.

One reason why data is kept separately for individual catastrophes is because catastrophe losses are quite variable from year to year. For ratemaking purposes, catastrophe losses have to be averaged out over a suitable period.

Right the first time, I think. Insurance companies have in their annual budget a provision for losses. The disasters in 2011 Q1 are expected to exceed the provision for the full 2011 year, so the disasters are now -- shock, horror! -- cutting into budgeted profit.

I wonder about insurance losses.
The losses will be to the insurance/real-estate-as-income investments.

The Earth moving/walls of water - Act of God.

The numbers I was was guestimate $10B insured. They then said only 10% of Japanese home are insured. I don't know how the figures for commercial and industrial property compare.

Insurance firms that hold real estate funded with insurance premiums with the idea that income from operating the real estate will cover the costs of running the insurance business NOW trying to collect insurance on the destroyed real estate is getting very meta/snake eating its own tail.

Someone gets a loss here.

"Up to 300 bodies were found in the beach of Sendai, the closest city to the epicenter of the quake. The city has a population of 74 000."

Sendai has a population of more than 1 million.

Looks like forest fire...only it's piles of houses. I assume there is nothing stopping fires from consuming unflooded homes as well, given that utilities are surely out of service.

It is a sad day for Japan. I can only assume that death tolls will rise in short-notice areas.

From some descriptions I've read, the fires after the San Fran quake in 1906 did more damage than the quake itself...it's described in 'The Upside of Down' for instance.

Very sad.

Kesennuma is burning:

With a starting population of 75K, there can't be much of the city NOT on fire.

I think it's just traders freaking out because of the unexpectedness/uncertainty. World markets dropped, too. Disasters are good for business - all that stuff will have to be rebuilt - but markets hate uncertainty.

I imagine that in the future, when the oil depletion rate is more pronounced, rebuilding will be a big question mark.

In fact, there has been serious discussion about whether the centre of Downtown Christchurch can be rebuilt where it is - that the cost of doing so (with many city blocks effectively untenable) - and the time required to do so - make it completely uneconomic for the business activity that would ultimately benefit from any re-build, whatever the level of government assistance and insurance pay-out (and even setting aside the obvious reality that the centre of CHC is now on an active fault line).

Hilo, Hawaii was destroyed by tsunamis twice in 15 years. After the second time, they took the hint and decided not to rebuild right next to the shore. Instead, there's a park there. It includes a memorial to those lost, with a clock that is permanently set at the time the waves arrived.

And I believe Texas moved its Capitol after it got the clue about putting it where it was.

Great place for transport - when you are floating boats as the cheap transport. Not so great for short, select times.

The refinery is done for rather permanently, I'd say. Fires burning unchecked in the buildings, processing plant, and storage domes. I think they will have to raze it and start from scratch.

Edit: It is a rather massive facility, so I may have overreacted on my initial view as one can see unaffected areas in the background. Still, it burns unchecked, and it is unclear how far the flames are spreading (or will spread).

So far, the news reports are saying the fire is in storage tanks, not the refinery itself.

Still too early for any solid info.

It's not layed out like those I've seen. Here, the storage fields are spread out, and in wide open fields with some sparse industrial sorts of buildings. The videos show many co-located tanks with piping manifolds, at least some process equipment, and some fairly large buildings all together. I can see no way to prevent the spread of fire between tanks, unless most of them are simply non-flammable.

I can see no way to prevent the spread of fire between tanks, unless most of them are simply non-flammable.

Any decent design would have considered that issue. Tanks should be surrounded by berms tall enough to contain a rupture. Japan has been living with earthquakes for thousands of years, if anyone is capable of containing the damage it should be they. I doubt this will be as disruptive as the 1923 Kanto quake.

I would have thought so too, but that's not the sort of design I see in the videos.

Edit: There are multiple fuel fires. This one is exceptional -- maybe a LNG tank or something? Truly amazing how much energy we burn routinely....


The WSJ says the refineries aren't damaged.

A fire broke out around storage tanks of the Sendai and Chiba refineries, but neither has been damaged, JX Holdings Inc. and Cosmo Oil Co. Ltd. said separately.

However, demand might be low for awhile, because roads and power stations have been damaged.

Remember good engineering requires money.
Investors want cheap so they insure a bad design.
Insurers know that they will just get bailed out. LOL

The cycle of industrial society, which cracks ahead lol.

I think with some refineries being closed, Japan's capacity to import oil has probably taken a hit. The one number I heard was 20% of refining, and 20% of electricty production are off line. I suspect some of this damage will take months to repair. Of course they will probably suck in refined product to partially make up for the shortfall. But in any event, some oil consumption capacity has been reduced for a nontrivial period of time.

and the zero-sum-game continues.

exporters 1 (Libya)
importers 1 (Japan)

the loss on both sides is horrendous
sad state of the world
so I go out and try to make the best of each day.

> But in any event, some oil consumption capacity has been reduced for a nontrivial period of time.

But some extra consumption may be coming too. A commenter on Early Warning suggests that since several nuclear power plants will be shut down for many months, the electricity shortfall will be made up with fossil-fueled plants. Japan used to have a large consumption of HFO for electricity, so this is at least plausible. Anyone who knows care to comment?

Edit: I see Leanan already picked up commentary on this: Japan tsunami "bullish" to global fuel oil upcoming months: sources, up top. I shoulda node.

In Tokyo, bicyles are selling out so people can get home. Silver lining? Or one time event? Maybe they will find some uses for those bikes even after subways are restored.

Brent is showing $114.97 according to upstreamonline.com at this time.

upstream is off line.

That is yesterday's price.

You can get the latest prices, only a few minutes delayed here: Bloomberg Energy Prices

Brent, as I post this, it at $113.72 and WTI is at $100.54.

Ron P.

It's called "Demand Destruction" for a reason.

Don in Maine

Job Creation :-)

Only if you have someone available to pay for the needed repairs.

I am guessing that there will be a lot of damage that no one but the government can pay for. But I don't think that the government will be up to borrowing enough more to pay for everything. It was already heavily in debt, and had quite a few current problems. Some areas may be abandoned.

re: Good Graph Friday. Solar, unfortunately, is not 1% of our energy supply but 1% of 8%, according to the graph.

re: Oil at $100 kills brain cells-- She is wrong. High oil prices do cause inflation. The central bank can cause inflation by increasing the money supply to go after the same amount of goods and services. In this case, the same money supply is chasing fewer goods and services. Either way, it's inflation.

Kyocera, Sharp and Sanyo source Si PV Cells and wafers for their Global Production plants ( US, Mexico, etc) from Japan, I'm have calls in to find specifics on plant locations and see how production will be affected. Anyone know? Looks like
much of infrastructure under 10 meters Seal Level near the cost is no more. Decades to recover?

Looks like
much of infrastructure under 10 meters Seal Level near the cost is no more.

The quake was quite a bit north of Tokyo. I would bet those 10M figures are probably from closer to the epicenter. I would think wave heights at Tokyo are less than half as high. Hawaii has wave heights up to 2M. Bay area is expecting up to a meter (at low tide, so probably minimal damage here).

Bay area is expecting up to a meter (at low tide, so probably minimal damage here).

Waves crashing ashore along the Californian coast were larger than normal, but only the town of Crescent City, near the California border with Oregon, and Santa Cruz, 72 miles, appeared to suffer any real damage.


They had the Santa Cruz city manager estimating $15M in damages. Mostly private boats, plus stuff like wooden docks. One man trying to photograph the tsunami near the Oregon Border was washed into the ocean, and not found. Add in the damages at Crescent city, and I'd wager more than $25M overall. Even as of sunset they are stiff trying to keep people away from the water.

Amory Lovins always says that, if you want to count solar contributions accurately, you would have to include the energy transmitted through windows. Beyond that, our whole environment is primarily heated by solar, so how would that amount of energy be figured? For accuracy's sake, the published amount for solar energy should be labled "solar thermal and solar PV from installed hardware systems" or some such.

Not only do the photons heat the planet - they drive the biological processes which feed us and decrease entropy of, say P.

The correct calculation of solar is further hindered as few even TRY to calculate the photons used to generate the biomass millions of years ago which resulted in the gasoline which is sold for less than a gallon of milk.

(Think about this for a moment. If you take some grass, a cow and a bull in a few years you have a way to make more cows and more milk - so long as you have more photons and land/grass to capture the photons. Gasoline is not renewable in a human's lifetime - and costs less. Thusly - if money is a reflective of how "rare" something is.....a material you can't replace in your lifetime VS something that can)

High oil prices do cause inflation

Oh if only there were classically trained economists who like wordsmithing on TOD to point out that Inflation is the expansion of the money supply - and lo the $ used to price oil has been subject to expansion.

Inflation is the expansion of the money supply

It could also be a fixed money supply chasing a decreasing amount of goods. A more precise definition would be the ratio of the volume of money (corrected for how quickly it is spent versus hoarded) divided by the volume of goods. You could certainly conjure up special cases where inflation could happen with shrinking money supply, or not happen with increasing money (i.e. if the production of goods is increasing even faster).

"re: Good Graph Friday. Solar, unfortunately, is not 1% of our energy supply but 1% of 8%, according to the graph."

I was just scrolling down to see if anyone else noted this.

That feels odd on a day (24 hours) when my PV dumped 2KWhour net of consumption onto the grid. But, then such systems are rare enough that it is probably true.

Russia needs investment, geographical expansion to maintain oil production

"But East Siberian fields are incomparable in size with West Siberian deposits and will only allow the government to prevent the fall in oil production for a short period of time."

Davletshin said that the overall reserves of East Siberian fields stand at 15 billion barrels. According to the U.S. Geological Survey, West Siberia contains 144 billion barrels of discovered reserves and 55.2 billion barrels of undiscovered resources.



Of the (2005) top five net oil exporters, Russia is the only one that has been falling on the outer edge of Sam Foucher's projections. As we previously noted, the wild card in Russia was production from the frontier basins, but as the above article implied the older basins are at an advanced stage of depletion.

In any case, the combined output from the top five are falling within Sam's projections:


I would have a long hard look at that graph, before rebuilding that refinery in Japan. By the time they could get it replaced, feed stock, well...

U.S. delivers coolant to Japan nuclear plant: Clinton


Any one know the Logistics? Flew in Water from a Base?

The reactor is a light water design. Could it have been heavy water that the US provided, to help damp down the neutron emissions more than the control rods could by themselves?

Nuclear physics is not my strongest science.

Light water for the primary coolant loop (where it also acts as moderator), and the light water used for cooling an on-site spent fuel pool, must be of extremely high purity. Given the various types of damage that could occur, they may need additional supplies that they can't produce locally at the present time.

I supose in an emergency you might dispense with the need for high purity. But then you are commited to high recovery costs. But if the damage is already bad (say the fuel assemlies got too hot) the damage is probably already done. But the plant will probably be closed for a long time. And the hysteria generated by the warnings etc. might make a restart politically impossible.

Pressure in the reactor is reportedly rising. Not a good sign when Chernobyl has already been mentioned (admittedly by an anti-nuclear group):


I think that story is out of date. The backup system worked. The reactor's okay.

Google shows that the story was posted less than an hour ago, but circumstances may have changed since the reporter wrote the story.

Edit: As I said, circumstances may have changed:

Japan to evacuate residents near nuke plant
March 11, 2011, 12:08PM
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

TOKYO — Authorities say the pressure is rising at a nuclear power plant in northeastern Japan after its cooling system failed. Japan's nuclear safety agency says pressure inside the reactor at the Fukushima No. 1 power plant has risen to 1.5 times the level considered normal. To reduce the pressure, slightly radioactive vapor may be released.

The agency said the radioactive element in the vapor would not affect the environment or human health. Japan has issued an evacuation order to about 3,000 residents living near the plant. The government also issued a state of emergency at the power plant.

The agency says plant workers are scrambling to restore cooling water supply at the plant but there is no prospect for an immediate success.

The evacuation was ordered earlier, when they were having trouble getting enough power for the cooling system. They've since said the cooling system is working fine. But there's a lot of mistrust...which is a big reason the last Japanese nuclear plant shut down after an earthquake was down for 3-1/2 years.

No the cooling system is not "working fine" according to expert on CNN International a short time ago. Although he said he was aware of reports claiming that. He said they had to get the diesel generators back up very quickly.

Generators apparently did start initially after quake then cut out later - maybe swamped by tsunami?

The pumps have been running on battery power, only available for a few hours. If the batteries fail there is an emergency coolant backup, likely gravity flow from towers, "a last resort", which usually requires venting. NYT reporting about 3 meters of water left above the core. These folks need to get generators or grid back soon.

Edit: Receiving external assistance may be dificult:

Janie Eudy told CNN that her husband, Joe, was working at the plant and was injured by falling and shattering glass when the quake struck. As he and others were planning to evacuate, at their managers' orders, tsunami waves struck and washed buildings from the nearby town past the plant.

"To me, it sounded like hell on earth," she said, adding that her husband ultimately escaped.

The pumps have been running on battery power, only available for a few hours. If the batteries fail there is an emergency coolant backup, likely gravity flow from towers, "a last resort", which usually requires venting.

I find that extremely strange. One would think they would have diesel powered backup. Diesel generators can run for weeks, the time dependent only on the size of their fuel tanks.

Ron P.

I think they did, but those failed. I am unsure if tsunami water played a role.

Do Japanese reactors use sea-water for bulk cooling? A tsunami could cause transients (water sloshing out then in, etc.), blockage, breakage, or whatever for the secondary loops.

There was some concern that the quake may have damaged the pipes, reducing the water available for cooling.

Fox is reporting that another plant is also suffering a cooling problem (Tohoku).

1) Points out the frailty of complex systems operating outside their design boundaries (beyond a tolerance margine)
2) Points out the value of distributed generation
3) Points out potential value of many small, self-contained reactors, versus a few big ones.

Is much of Japan in the dark tonight, I presume? At one time I heard something like 11 reactors were off-line, and that would almost have to be a significant fraction of the grid power, especially since I assume some other types of plants would have had problems as well.

This article has some information.

Reactors shut down due to the earthquake account for 18 percent of Japan's nuclear power generating capacity.

Nuclear power produces about 30 percent of the country's electricity. Many reactors are located in earthquake-prone zones such as Fukushima and Fukui on the coast.

There is two kinds of cooling for a nuclear reactor. There is water needed for the condenser. That sits just below the turbines and condenses the steam back into water to be recycled through the boiler. All power plants have this whether it be nuclear, coal or gas. And they all use sea water when available. Inland they use river water. The water is cooled before returning to the river. The plant I worked at in Saudi had no cooling towers. The water was just returned to the Persian Gulf quite warm.

A nuclear power plant has cooling water for the reactor. This, I suppose is very special water and would likely be slightly radioactive. It must also be treated to avoid any type of corrosion. I have never worked around a nuclear power plant but I am sure this cooling system would be very different and very special. But that would be something I know nothing about.

Ron P.

I would assume that having the condenser water run out to see as the water pulled away would do bad things to that control system. The Google picture makes it look like it has a little perimeter of bounded water as a man-made lagoon, and then open sea. All of it looks quite frail.

This would cause a loss of vacuum and trip the turbine.

Most reactor cooling systems have a primary and secondary cooling system. The water around the core (primary) is maintained at a high purity level and is circulated through heat exchangers that move the heat to a secondary system (sea water, river water, cooling tower, etc.). Pumping requirements can be very high, 1 million GPM in some cases. The primary side is a closed loop, excepting makeup water requirements (like when they vent the containment vessel :-(

One report I read said the diesels were swamped by the tsunami. If they were running, they're junk for now. I'll try and find the report.


Another problem is that the water contains so much mud after the tsunami that it will be difficult to use it for cooling Fukushima Daiichi, said Beate Kallenbach-Herbert, a nuclear expert with the Oeko-Institut in Freiburg.

The debris can clog up the cooling system, according to Marin Kostov, a power plant safety engineer in Bulgaria who has advised Japanese authorities on seismic safety.

"Ironically, a tsunami causes loss of water," he said.

If you watch the video and Google the reactor, it is literally on the beach. It's hard to judge the height above sea level, but it's not much. I would not be surprises if there is considerable water damage to the facility overall.

Yes, that was my understanding.

The news reports are very confusing, because a lot of the information - the government statements, evacuations, etc. - is from before they got the battery backups working.

It sounds like they are trying to get diesel generators running now.

USAF said to have flown in emergency generators - not coolant as Clinton said. That according to some reports anyway.

You mean to say, they didn't have any generators locally that could work? Sounds fishy to me too.

eastex, have you ever seen what happens to a running diesel engine in a boat that sinks? It's basically only worth its weight as scrap metal after that. Yes, fishy, is an appropriate term but only if you associate it with Davey Jones' locker.

And certainly flying in generators from an area that *wasn't* just half washed out to sea is a good thing when dealing with a nuclear reactor.

NNK storyline says they plan to vent, but that story could be stale, too, I suppose.

Fires are quite massive in some areas:

Some sources are saying radiation was already released. A Russian story says unusual levels of radiation have been detected in the area. Some sources say they might have to release some radiation, and nothing's been released yet.

I suspect it's a translation issue.

Reuters Flash: Japan trade ministry: Pressure inside Fukushima reactor may have risen to 2.1 times designed capacity

Link? It's likely 2.1 times atmosphere. Design cap should be much higher.

Thanks. Reports are all over the place. Some guy (expert?!) from UGA, on CNN, just said that the good news is that the reactor takes along time to cool down and this gives them plenty of time to fix things. The opposite is true, of course. If the reactor is holding most of its heat, they need to react quickly to avoid boiling off the coolant.


Hours after the evacuation order, the government announced that the plant, in northeastern Japan, will release slightly radioactive vapor from the unit to lower the pressure in an effort to protect it from a possible meltdown.

Edano said the amount of radioactive element in the vapor would be "very small" and would not affect the environment or human health. "With evacuation in place and the ocean-bound wind, we can ensure the safety," he said at a televised news conference.

The News media keeps calling it a radioactive leak. That is inaccurate as it is an intentional release of steam to relieve pressure and cool down the core.

Just like a Steam Engine blowing it's whistle to relieve excess pressure(heat energy). Just not such a good thing when the steam is radioactive. The real problem will arise if they don't have the energy as in diesel powered pumps to force in enough replacement water to keep the core covered.

I'm not sure that's what it is. It's still very confused, but...the articles I've seen say the intentional release hasn't happened yet, but they're getting this high radiation reading. They don't know where it's coming from.

NHK reports intentional release has started. They said radiation levels 1000 * times normal in control room and 8 * normal at gates.
Emergency situation now extended to 3 reactors at site they report.

They are also reporting that city of Minamisoma, pop 75k seems to have been mostly wiped away.

I don't want to go to sleep tonight. I don't want to wake up to my worst fears for the people of Japan
(and our fragile planet).

This one needs a name. I dub thee The Godzilla Quake.

...... and if the cooling is not soon being put back into effect - eventually all that radiation will reach the surroundings intentionally or with a bang. No way around that I'm afraid.

NHK World has stopped transmitting live pictures of the plant. Actually they seem to have stopped transmitting live pictures all together. Not sure why but I imagine they have plenty problems to deal with themselves.

Latest: Evacuate 10km radius Fukushima 1
Evacuate 3 km radius Fukushima 2

Plants 10km apart

I presume this is steam coming from the overheating water bathing the fuel rods. So it does contain some radioactive material. I agree it is not likely enough to be a health hazard. They probably are being overly relucant to release it because it is a PR disaster for the industry.

If the batteries will cover 8hours of pumping with no help, even a small additional generator should allow them to last longer. The amount of radioactive material decaying in the fuel rods does decrease with time. So its mainly a matter of keeping enough cooling going to prevent overheating. The amount of cooling needed should be a decreasing function of time. So its simply a matter of kicking the can down the road until active cooling isn't needed.

Apparently, it wasn't that they were reluctant to release the steam. It was that they couldn't. Without electricity, there was no way to open the valve. It took them hours to get around that problem.

Given the motivation and resources, I would be surprised if there aren't spare batteries and generators already on-site and being swapped in or connected. One would suspect that if necessary generators and batteries could be borrowed from non-critical plants.

I wonder if they are still trying to save the reactor intact, or it's already past that point?

Talking head on CNN seemed very concerned. He said radioactive iodine has been detected outside the reactor, and they don't know how it got there. An unplanned leak.

Whatever happens...I think we can expect these reactors to be shut down for years. Kashiwazaki-Kariwa was shut for over three years due to a smaller quake and much less damage than this.

I think my daughter summed it up well, when she remarked that from the outside the nuke plants appears perfectly normal while the refinery is massively burning, yet the reactor is actually more dangerous and probably more badly damaged.

Looks can certainly be deceiving. Given multiple reactors at the site and ongoing maintenance work plus fuel rod storage, there could be other faults in play besides the obviously hot reactor.

I wonder if the loyal, sacrificing Japanese personna is still real? Will the techs stay in the control room even as the radiation levels become personally dangerous? Quite likely there are quiet heros hard at work behind the scenes. I hope they succeed.

I recall T-shirts printed after the famous 1979 reactor incident (I lived in Central PA):

TMI Staff: I Stayed Behind to save your @$$

The News media keeps calling it a radioactive leak.


That is inaccurate as it is an intentional release of steam to relieve pressure and cool down the core.

And you know the reports are inaccurate?

Why should you be a better source?

I don't know if there are radiation leaks or not. But the people who make up safety statics about fission plants can't seem to explain how:
1) a tsunami is outside the design parameters.
2) why the safeguards which are claimed have failed.

Given you are claiming to be a better source - perhaps you can answer 1 and 2?

1) Every system design has bounds. If you made it indestructible, you couldn't afford it. So far, so good.....tomorrow, maybe not.
2) Because a design only covers so many simultaneous failures, and only then if they are identified in advance. Maintenance issues, mistakes, oversights, and bad luck can all play roles in things failing even before they should.

And this explanation backs my long standing position:

Machines made by humans are subject to failure and the because of many of the disastrous failure modes in fission power, fission power should not be considered a long term viable solution.

The "peaceful atom" experiment has failed. Time to accept that and move on.

At last one reactor now said to have abnormally high pressure - dangerously so. That info just broadcast by NHK World as current info. May have to release to atmosphere they said.

From info from an expert said to be familiar with the plant on CNN earlier, only very limited emergency cooling on battery power was available at the plant.

Interesting. Tepco says that report is wrong, but the Japanese media is running with it.

They seem to have the same problems with nuclear plants in Japan as we Yanks had with BP. Nobody believes them, perhaps for good reason.

"Small radiation leak could occur" just said by Japanese government a few seconds ago according to BBC tv.

I think they want to vent the steam above the water, to reduce the pressure to within tolerance for the pressure vessel. If the vessel ruputures, the core will be exposed.

It's sort of the other way around. The core is exposed when the water level drops too low. Water not only cools the core thermally, it is the moderator that reduces the reaction and contains most of the radiation. If the control rods begin to melt, the reaction will be out of control, overpressurizing the containment vessel, requiring venting. Venting the dome now releases small amounts of radiation. Once the core is exposed (water level too low) the radiation/heat released goes up exponentially: nuclear steam explosion > Chernobylish nightmare.

More on a reactor SCRAM and control rods here.

"I think they want to vent the steam above the water, to reduce the pressure to within tolerance for the pressure vessel. If the vessel ruptures, the core will be exposed."

There should be a last ditch non-electric relief valve set at the design pressure for the reactor vessel, or more likely a couple of them. The pressure would be released into a pool or quench tank, or even just vented. Letting the pressure vessels rupture is not allowable in ASME code, and I doubt the Japanese are more lax.

Evacuation now ordered up to 10km. Japanese Prime Minister on way to site.

Report of (presumably unplanned) radiation release from the site.


8 times background at the site gates.

This one may be getting away from them.

The Russian media reported this hours ago. No one else did, so I thought they must be wrong.

If true, this isn't good news for the nuclear industry.

Just when we need a resurgence, this may seal the fate of new nukes. If so, that is a bad omen for Japan and other fuel importers, like the US and Europe.

Best hopes for limited release and a rationale response by the press. That was hard to even type......

Fission plants failure modes are too great.

Perhaps over the fullness of time the pro-nukers can provide a reasonable explanation but here in the passion play of TOD, the pro nukers have made safety claims about how often failures are supposed to happen and the odds of winning the powerball lottery were worse - yet every year people win power ball.

The nuclear regulatory agency of the US of A is on record about safety.

Safety in Numbers?

What are the chances of a nuclear accident? Here's what the NRC said in 1984:

"The most complete and recent probabilistic risk assessments suggest core-melt frequencies in the range of 10-3 [one in one thousand] per reactor year to 10-4 [one in ten thousand] per reactor year. A typical value is 3x10-4 [three in ten thousand]. Were this the industry average, then in a population of 100 reactors operating over a period of 20 years, the crude cumulative probability of [a severe core melt] accident would be 45 percent."

Hence, the Nuclear Regulatory Commission reported about a 50-50 chance of a core meltdown occurring by 2004. Time is running out!

All the while the environmental accumulation of heavy metals particulates in our food chains resultant from coal power plant emissions silently continues and indeed increases in magnitude, out of sight and out of mind to the vast majority of folks.

Enjoy your Tuna sandwiches.

There is no free lunch...pluses and minuses for all technologies.


There is a lot of focus on what might happen with the nuclear reactor, but less focus on what has already happened to people.

Judging from the reports coming in, the death toll will probably rise to over 10,000. Several sizeable coastal towns appear to have been swept away or to be burning. Well over 100,000 homes appear to have been destroyed.

Latest from BBC live blog:

1252: Japan's Fuji TV has run a screen caption saying that as many as 10,000 people are missing in the town of Minamisanriku in Miyagi prefecture.

What a nightmare.

NHK World just said that seawater is now being pumped into the stricken nuclear reactor in an attempt to cool it. Pumping began at 11:20 GMT (just over an hour and a half ago at time of posting) they reported.

Edit: Possibly that was time instruction to use seawater was given rather than time pumping started - unclear for now.

Large aftershock reported around Fukushima now. Reported as 5 on Japanese scale. Edit: Preliminary Richter magnitude 6.4 just confirmed, location close to Fukushima plants and right on the coastline.

Minamisanriku hospital virtually only building still standing. Hospital has 5 floors and was flooded up to the fourth floor.

Before and after pictures just shown by NHK. Now being rebroadcast by BBC and others.

9,500 unaccounted for in Miyagi's Minamisanriku: local gov't

SENDAI (Kyodo) -- About 9,500 people are unaccounted for in the town of Minamisanriku in Miyagi Prefecture following Friday's powerful earthquake, prefectural officials said Saturday.

The figure is more than half of the population of about 17,000 in the town on the Pacific coast, they said.

Perhaps over the fullness of time the pro-nukers can provide a reasonable explanation but here in the passion play of TOD, the pro nukers have made safety claims about how often failures are supposed to happen and the odds of winning the powerball lottery were worse - yet every year people win power ball.

I consider myself a pro nuker, but due to Peak Oil+GCC+earthquakes combo coming soon into a town near us I'm quite concerned about their overall safety and dead bodies / usefulness ratio.

It wasn't such a long time ago I got into an argument with lengould about safe decommissioning of aging plants while we will have a fraction of energy we do have now. And I was talking just about peak oil, no disasters like quakes, weird weather patterns, flooding, tsunamis, landslides, you name it. Other people (I have a high regard for (Black_Dog, RockyMtnGuy)) stepped in and explained him a thing or two :) , so I didn't need to take one more skeleton out of the closet that will probably come back and haunt us... :/

Now consider that Christchurch type vertical quake would directly hit a nuke. In science, we can't say that something is impossible. It can be only highly unlikely, but as we see, accidents DO happen. Dismissing such risks because our pro-nukism clouded our sane judgement might prove fatal in the end.

/rant off O:-)

I'm very sad because of what happened in Japan and really really hope that pi is safe... :(( I like her posts and last pi posted was on March 10 (http://www.theoildrum.com/node/7614#comment-774340). Hopefully she will be back soon... pi, if you read this, please let me (us) know that you are safe...

Nuclear is toast if Japan blows a reactor.
No one will trust it I am afraid.

Yeah, we'll be eating sand in 30 years thanks to global warming (*) because there was some radiation leakage at a nuke plant. Clearly cost/benefit analysis is not something to be done when anti-nuclear hysteria is all the rage. The radiation release around Chernobyl was incomparably worse and that did no bring about doom for humanity.

(*) Recent analysis of climate model rain pattern changes shows that most of the world's agricultural zones are going to be afflicted with drought and not just get randomly wetter or drier. It appears that the regional climate in the world's food basket zones is in a narrow band of stability.

BTW. Exactly how did nuclear prevent climate change. Nuclear if anything has made matters worse extending the overpopulation further and further.

And well who gives a darn about climate if you die under the rain of nuclear fallout.

We do not need nuclear at all. Mankind did fine without it.

Now look at Japan. It is about to become a nuclear cocktail of contaminated wasteland.

3 reactor cores are in trouble. THREE.

Yes, I think I am right and I am entitled to my opinion.

Bye Bye nuclear. IMHO.

Make that 5 reactors ........ who'll run through the statistics?
If I have got it right they are in deep **** between a rock and a hard place without more cooling asap, cus' the venting will intoxicate the environment of the repaircrew.
This doesn't bode well IMHO and there is only so much they can do ..... Fingers crossed !

Emergencies declared at 5 Japan nuclear reactors - http://www.msnbc.msn.com/id/42025882/ns/world_news-asia-pacific/

Make that 5 reactors ........ who'll run through the statistics?

Depends on whether the probabilities are independent. Say they were independent and it was a 20% chance that any individual one would fail. Then the probability that none would go is 0.8^5 = 0.33 = 33%. So this switches from an unlikely event to a likely event when taken together.

But that is just going according to straight probability and we do not have a large set of statistics that we are leaning on.

I believe that this is 5 reactors at two locations, so the probabilities are not independent. Furthermore, declaration of an emergency is a political event as well as a technical event, since it empowers national authorities to override local authorities and to mandate actions and expedite activities more effectively than would be allowed under normal circumstances.

Yep. Exploding nuclear power plant is an ominous sign. Even if the reactor is still intact.

Video on the main news page now . . . big, big explosion http://www.bbc.co.uk/news/

This article contends that fuel rods were exposed and it seems like radiation is currently being vented outside the plant. I have a lot of trouble following this story in chronological order through news stories, though.

URGENT: Japanese Gov’t Confirms Radiation Leak at Nuclear Plant

Officials confirmed some fuel rods inside the plant were exposed after water cooling systems failed at five reactors within the two crippled power plants.
Pressure has been building up in Fukushima reactor — it’s now twice the normal level — and Japan’s Nuclear and Industrial Safety Agency told reporters Saturday that the plant was venting “radioactive vapors.” Officials said they were measuring radiation levels in the area. Wind in the region is weak and headed northeast, out to sea, according to the Meteorological Agency.

I guess we can put a fork in the nuclear renaissance.

Leanan, This is obviously a huge story unfolding in the shadow of the original huge story of the earthquake/tsunami. Could TOD put up a thread devoted to following developments at these nuclear plants?
Thank you,
- Walt

I'll ask.

However, there will be a new Drumbeat later today, and news is usually pretty light on Saturday, so it might end up being a defacto Japan thread.

Japan is really sucking all the air out of the room. There's hardly any news except for the earthquake. So for now, we're going with just the regular Drumbeat today. If something big happens, we may put up a nuke thread later. And if it's still a big story tomorrow, we might put up a thread then (a day when there's usually no Drumbeat).

China not to change plan for nuclear power projects: government, March 12, 2011 10:53:38 (GMT?)

China will not change its plan for developing nuclear power projects but will learn a lesson after a massive earthquake in Japan resulted in a radioactive leakage, Vice Minister of Environmental Protection Zhang Lijun said Saturday.

Are humans smarter than yeast?


I am convinced China will be due for a massive industrial disaster like every 5 years with there foresight and 5-year planning. LOL


*The probability of that happening to us is low. Come on please don't tell be we have to follow statistics too like Japan. Pretty please.

We'll be putting a fork in humanity thanks to such shallow thinking.

It has begun to melt down it appears. They probably all will -- the ones in jeopardy.

Nuclear is officially finished at least anywhere remotely close to a hurricane zone, earthquake fault line, volcano, you name it.

This stuff is going to need serious thought by reasonable people. I admit I am not thinking reasonably right now. I live in CA and I see no way how a nuke could be placed near our fault lines. I am sorry but it is quite stupid, and 100 year events happen. Yeah I know a billionaire or two don't care because they winn either way in a melt down, but I care about my house.

Name an instance when a Wind Farm or Solar Thermal or PV system exploded releasing a massive plume of radioactivity.

I will take intermittency, dead birds, and eye sores all day long. Exploding nukes are not pretty.

Clearly cost/benefit analysis is not something to be done when anti-nuclear hysteria is all the rage.

"Hysterical" costs to benefit-calculate:

Twenty-five years after the Chernobyl disaster, low-dose radiation has proved to have significant effects on normal brain development, shown by the birds' brain size.

All for the benefit of clean, safe, too cheap to meter Nuclear power!

(and what if the benefits aren't actually delivered? )

Give it up, Eric. Nuclear proponents constantly minimize the downside to nuclear power while accusing those who would question it of hysteria. Most have little understanding of the technology, yet are hysterically hoping it will preserve some level of BAU. Better to have a pro/con discussion of religion :-/

While much of our infrastructure isn't being safely maintained these days, to insist that nuclear is the one exception is a stretch for me, especially in this age of cutting corners and costs.

Spare me the nonsense. Hundreds of millions of dead outweigh the potential deaths of a few thousand from reactor failures. But maybe some people are pining to see the megadeath by climate change.

Acceptable losses, huh Dis?

Spare me the nonsense.

Nonsense? Hrmmmm. Lets see if there is someone making non sense.

Hundreds of millions of dead outweigh the potential deaths of a few thousand from reactor failures.

I post a message about the effects post-generational on birds and YOU erect a straw man of:
1) Humans
2) Death

How do birds become humans and long term generational effects become death?

You have erected a straw man that isn't even TIED to my post.

Your reply makes no(n) sense.

Well, actually it does if you can't address generational effects as shown, if you can't address the 20+ mile no-go zone, if you can't explain why fission plants can't operate without fines for failure to operate within safety regulations, why the peaceful atom program has failed to deliver on its promise, et la - Go for the unproveable emotional "humans gonna die from climate change AND FISSION TECHNOLOGY WILL SAVE THEM"

Natural disasters cannot be protected against. So why build nuclear if the process is inherently unstable by its very design under real world situations?

Nuclear is not even 60 years old and we are looking at about 8 disasters already--where 5 are proceeding right along to disaster--no one can stop it -- it is pure chaos in motion.

So odds are good that nuclear plants will fail catastrophically.

Before even talking about extreme radiation and contaminated farmland, air and water lets talk about the "cost savings" of nuclear relative to almost any other power supply.

What is the cost per kW-hr at Fukushima right now?

How will fission plants survive a major Coronal Mass Ejection from the Sun?

Right now these designs have support from various fossil fueled, controlled by electrical circuits machines of man.

What happens when the support machines become junk because the CME causes the electrical systems to not function?

(the more probable situation is Man VS Man violence wrecking a plant - another condition the pro-nukers hand away)

Cold comfort.

How are all the various reactors gonna fair when the regular solar CME's hit the Earth?

All nuke-stations located within the striking distance (elevation) of a tsunami-style wave are constructed too low, Murphys law in action her, actually - it's not even Murphy- this event is plain obvious cus' water goes where water goes....... when given the opportunity.

I guess this event will spawn new implementation standards for future nukes - in tsunami-prone areas.. 20 m asl.

All nuke-stations located within the striking distance (elevation) of a tsunami-style wave are constructed too low

I suppose this as an example of planning for a hundred year event, then being on the recieving end of a 250year event [my guess for this magnitude of offshore EQ in Japan of this size]. Obviously critical infrastructure needs more stringent standards than everyday stuff.

I read they reactor complex is 15M asl (above sea level), twice the height of any anticipated tsunami. So either the tsunami was very high at that location, or the diesel backup gen was located much lower. I guess it will be a while before we really find out.

I heard 23ft was experienced. That's well under 15m, but a lot of water in any case.

NHK reporting possibly higher than 10m in some areas. Entire towns with mainly wooden residential buildings almost completely washed away -only some concrete buildings remain. Water flooded up to 3rd floor of high rise buildings they are reporting. Tidal gauges broken/offline in some of worst hit areas which is why official largest value recorded only 7.9m.

NHK now suggesting there seems to have been subsidence on coastline and many areas may now permanently be under water.

Watching scenes of the flooding move inland over flat farmland, I think the ground is likely to be alluvial soil, which could liquefy rather easily. The USGS site lists many quakes of magnitude above 5 and some above 6 before the big one and there have been more since. That alluvial soil being very wet could easily begin to move toward the sea and the surface settle lower...

E. Swanson

Am I right in understanding that four reactors shut down automatically, as intended, and the fifth is the one causing concern? Nearby populations within a radius of six miles are now being moved and some venting of contaminated air is being carried out, but seemingly nothing critical.

I heard this on the BBC news tonight. My detailing may be slightly wrong but that was the gist.

If this is so, and the damaged reactor is contained, than it could be argued that the nuclear reactors did very well, given the magnitude of the disaster. Look at the oil refineries!

They all shut down automatically, as they were designed to do.

The problem is they must be cooled for a day or two even after being shut down. That is what's failed with one of the reactors. (Or maybe two.)

Thanks for the detailing, appreciated.

Tomorrow I suppose we will know if it is Chernobyl II or a successful containment. We need nuclear so I hope it is the latter.

The costs in material and energy of the rebuilding will be enormous, as will the disruption to the world's energy provision, so I wonder how inflation, interest rates and the world economy in general will develop now?

These systems require fairly clean water or the intakes, heat exchangers and pumps will foul. When all coastal waters for 100 km are full of junk ..... a bit like the pumps in New Orleans.

This area got double slammed by the Godzilla Quake. Busy times for these engineers, knowing they can't just walk away and watch it burn.

Generally, RWMU (river water make-up) and circulating water pumps have suction caisons, intake rake, and travelling screens after the rakes. It sounds to me like their circulating water or rwmu pumps were inundated and rendered useless losing cooling water.

As I understand, cooling has failed at 3 reactors. The situation is very serious at two of these at the moment and evacuations ordered around two distinct sites (Fukushima 1 and 2).

We do not have any details about what sort of damage these reactor units sustained. The explosion at reactor #1 indicates to me that there was cracking of the reactor calandria. So they did not get the full 24 hours to address the cooling failure. The media coverage of this event has a lot of downplaying of the damage. The explosion shows a failure of the containment concrete structure in spite of all the talk about how no Chernobyl could occur in western reactor designs. Even if there was no total failure of containment such an explosion could not originate outside the reactor core.

Regardless of this disaster, it is nothing on the scale that is looming from the burning of fossil fuels. Anti-nuke hysterics will be playing this up while completely ignoring the lethality on both short and long term time frames of fossil fuel plants. Too many B-grade movies indoctrinated them in childhood to fear all things nuclear. Unfortunately nothing was there to teach them to fear CO2.

Nuclear is merely an extender of the coal and NG plants.

I do not see your logic. We are maintaining a massive level of fossil fuel consumption because of nuclear. Nuclear is an enabler of extreme population growth and CO2 production -- not the other way around imho.

Dissident, we should switch to solar, wind, hydroelectric and geothermal and reduce our power consumption (localize, improve efficiency, reduce population). We should not build more nuke, coal and natural gas electrical generators, but instead phase them out over the next 40 years.

But how low is too low?

The projected water levels if all the ice is non-ice?

The water levels shown on the "secret Navy maps" the "900 foot rise" wack-jobs have mentioned? (some BS about the Earth orbit/spin changing due to a companion brown dwarf star)

What about the waves if that island falls into the see and the waves hit the East coast of the US of A - the waves which would wash away Boston and Washington DC?

Wouldn't it be easier to just say "yea, lets not build nukes"

According to BBC at 21:31 UTC, Japanese PM Naoto Kan announced that the evacuation area around the Fukushima nuclear plant has been expanded to a 10km radius.

A minute later BBC reported, "The Tokyo Electric Power Company has said radiation may already have been released at the Fukushima-Daiichi nuclear plant."

Source: http://www.bbc.co.uk/news/world-middle-east-12307698

Parts of the Time article linked above about the theft of Pemex oil put me in mind of Undertow's post in the last Drumbeat about the EIA numbers adjusting upward by 622,000 barrels per day.

From the Time article: "Last year, the government oil monopoly Petroleos Mexicanos or Pemex detected 712 such pipeline taps — a fivefold increase compared to the 136 spotted in 2005."

"Meanwhile, stolen crude is sold off to brick makers who use the fuel to fire their ovens; or it is smuggled across the border and peddled to oil tycoons in the United States"

Could the upward adjustments by the EIA be a reflection of black market activity?

Light bulbs, abortion make for odd Senate hearing

WASHINGTON — The humble light bulb became a lightning rod for philosophical differences in the Senate on Thursday — a debate so vitriolic that while the focus was supposed to be on more efficient bulbs the talk went as far off-topic as abortion...

"You're really anti-choice," he added, saying he supported a bill to repeal those standards.

"I find it insulting," Paul said, calling federal officials "busybodies" trying to tell Americans what to do.

"Where's this country gone?" echoed Sen. Jim Risch, R-Idaho. "The government trying to fix this? That's not going to happen."

This is what it looks like when Complexity overwhelms our political process, just before Systemic Collapse.

We have 2 wars, Libya melting down, massive unemployment . . . . and these clowns are worried about 'losing our freedom' to waste energy and water?!?!

I'm amazed. Way to focus on the big priorities . . . our consumer choice of light bulbs and toilets. Yeah . . . fight the power Rand Paul! Fight that crazy freedom-hating law signed by renowned liberal hippie tree-hugger, George W. Bush. We need our god given right to waste power!

I have many libertarian leanings, but none of the current crop of libertarians seem to have any idea about limits to growth due to natural resource constraints. They just blame the evil government for restricting the magical powers of the free market to deliver magical economic growth forever.

These clowns are waging their own war within the US. So if we include cultural/political wars we have a third war going on. Once a war gets started participants are not likely to stop because of outside events.

That's the thing Spec, there is no reason we should be taking these people seriously anymore.

Like Orlov said, "they are a colassal distraction... stay focused" (on preparing yourself and family).

It is game over. No sense waiting around for any more "signs" - no whistle will blo, or starter's pistol will sound, no fat lady will sing.

Wasting power is odd to consider as something we would even want to do.

It reminds me of the kids that shot cats with BB guns. There is no reason to be that cruel to a harmless/helpless cat.

Grow up America! We have a serious problem.

From the Arab News report that Saudi customers seek steady supply above:

JEDDAH: Although the global oil market is facing supply disruption due to unrest in Libya, fellow OPEC member, Saudi Arabia is expected to keep its contracted oil supply volumes to most customers in Europe unchanged in April from March.

"Aramco had communicated with us about additional supplies but we have not explored that option. We did not ask for more because we do not need any more Arab Heavy barrels," Reuters quoted one European customer, who asked not to be named. "There will be no change in our allocation from March."

The customer, a regular buyer of Libyan oil that also has a term contract with Saudi Arabia, received notice of its crude oil supply allocation from Aramco ahead of others.


Three other customers said they expected to receive a notice from Saudi Aramco about their April allocations next week, and that they had asked for the same volume as March.

One of them said many European refineries have been forced to cut oil product output due to weak refining margins rather than buy more oil when North Sea benchmark Brent crude has remained high, near $115 a barrel, Reuters said.


This report ties in with the Oil Movements analysis as reported by Charles.

This article gives four scenarios on how the tanker market is going to be affected by the drop in Libyan oil exports. Very good article overall, however, all four scenarios assume complete replacement of oil by other exporters. I think a really poor way to track export levels on a weekly basis could be the dirty index (Index).

Libya and the tanker market

In the first and second scenarios, all Libyan crude exports were assumed to be replaced by Middle Eastern crude. The first assumed that the vessels hauling this oil to European destinations transit the Suez canal when both laden and in ballast, whereas the second supposed the longer route around the Cape of Good Hope was taken, with the predicated reality being somewhere in between.
The third and fourth scenarios brought West African crude supply into play, with the third assuming it replaced all Libyan crude and the fourth that supply was split equally between West Africa and the Middle East.

The New Line of Demarcation: East & West split OPEC oil supplies

There is accumulating evidence in the past two days that there has been some new oil agreement - that may be considered a modern day “Line of Demarcation”. That is substantially all oil from the Persian Gulf will basically be shipped ‘east’ (mainly to China) and most all oil from West Africa (Angola + Nigeria) will go to the west (most all to the EU and US). I am not sure if this is some type of formal quid pro quo, or some type of mutual agreement for the sake of practicality (thus postponing the possible bidding war for available supplies, which may lead to a ‘super-spike’ in prices that I first discussed about three months ago).

However I don’t see this as a lasting solution, as all exports from Libya are now lost. The increase in OPEC exports (from West Africa + Persian Gulf OPEC) will be at best half of the loss from Libya in early April. While Japan’s demand for oil will diminish, its demand for oil product imports may increase, so it doesn’t affect the supply/demand balance very much.

Shipping reports indicate that oil exports out of the Persian Gulf will increase about 300,000 bpd starting about March 15. There is also a further increase expected there about April 1, and also, exports out of West Africa will increase in the first week of April. I presume that West Africa is now producing at maximum practical capacity.

Does this mean that Egypt loses all oil shipment revenues through its pipeline and the Suez Canal?

Is someone sending Egypt a message?

In the first days of the Libya crisis, there was a great increase in traffic through Egypt. Now it has diminished. Above, more specifically, I am discussing large tankers and supertankers. Smaller tankers, that fit through Suez, will still go through. A lot of those are from Iran. Also the "Line" splits Saudi Arabia in half - the oil and oil products from KSA's west coast will still head mostly up through Egypt.

There is accumulating evidence in the past two days that there has been some new oil agreement - that may be considered a modern day “Line of Demarcation”. That is substantially all oil from the Persian Gulf will basically be shipped ‘east’ (mainly to China) and most all oil from West Africa (Angola + Nigeria) will go to the west (most all to the EU and US).

I think that's unlikely since the Chinese control a large amount of West African oil production. The Chinese will source oil wherever they need to, and will outbid the EU and US wherever necessary. That being said, the Chinese will send oil they control to the EU and US whenever they can make a profit from doing so. It's all about money from their perspective.

The April, 2011 issue of Consumer Reports is their auto issue and has a couple of pages on the Volt and the Leaf. Based upon the price they paid for the Volt, $48,700 - say $41,000 after the tax credit, I really wonder who is going to buy this car except to make a statement?

Further, in their driving to date, it has been taking 13kWh to recharge the battery. That's in the range of many homes. And, in California where there is tiered pricing, it is not going to be that cheap (at this point anyway).

Although the Leaf is cheaper ($35,270 - $7,500TC), it took 22kWh to recharge. To me that is just an amazing amount of juice. Based on their numbers, the Volt would cost 5.7 cents per mile while a Prius is 6.8 cents per mile and a Honda Fit ($15,100-$19,240) is 10 cents.

Anyway, the article has much more information.



You seem perfectly correct with the calculations. A few cents for the Volt, 10 cents for the Fit per mile.
And that is the problem... until now it hardly pays off. But sure its 5$ per 100 miles.

Moreover if you use coal power electricity the environmental (CO2) savings are not that great neither...

It is really difficult to transport oneself cheap and clean.


I can't take credit for the numbers - those are CR's not mine.

I would guess that the electric costs do not include any tax amounts for road maintenance and other purposes, while the gasoline prices do. If we are to have any significant share of electric cars, they will have to pay their way with road repairs, so this will need to change.

Large trucks also do not pay their fair share for damage to the roads either. Rail is much better for large cargo in terms of wear on roads. Not that we will shift much in that direction.

Seems the way roads are deteriorating. Road quality may become limiting along with the supply of fuels. Raise fuel prices and let the roads deteriorate. A path to energy independence fought on two fronts.

Obama news conference on now. He's doing the two step around our oil situation; says we need to reduce our reliance on oil in general, but it seems he won't touch the concept of peak oil, increasing competition from other countries/ELM, etc.

Go on, Mr. President; spit it out. P P P Peak Oil! Now doesn't that feel better?

"...there's no reason that countries in the Middle East shouldn't have the same growth rates that we're seeing in China and India."

I can think of one: they'll be keeping and burning more of their own oil. Alot more. Doesn't quite fit in with your plans for continued/increased growth in the US. Stop making sense.

anybody got a link to the transcript?

Some of it here, including video.

Sorry, Ghung. I read your post carelessly and got excited. I thought you said that Mr. O had actually said "peak oil". My mistake. He displays a good working knowledge of the oil market as it functions today, but there doesn't seem to be any sense that things could change permanently for the worse. Oh well.

To paraphrase Homer Simpson "You don't win votes with carpools".


"...there's no reason that countries in the Middle East shouldn't have the same growth rates that we're seeing in China and India."

Obama said that ?!?!

Obama is Themla and the rest of us are Louise.

slightly off-topic:

Earlier I recieved the following WARNING email from our school's president:

I just want to share with you an e-mail (administrator) received from the Federal Govt. agency late yesterday that funds his (****) Program. If the bureaucrats in DC are preparing for a Government shutdown next Friday, the 18th---we should too - check out your grants---any questions re. what's allowable, see (admin #1) or (admin #2) for answers. Better to be prepared as there is no way of predicting how long the shutdown will last ...

I was VERY tempted to broadcast a reply saying, "Please pray for a permanent government shutdown."

The federal government is now more dangerous to us than not - the federal government Is the Boondoggle.

The sooner the Federal Goverment stops functioning, the better.

"The sooner the Federal Goverment stops functioning, the better."

That's the most absurd thing I've heard on a drumbeat lately. ..and that's saying something.

I know. You like saying that sort of thing. You seem to fancy yourself a rebel.. but I have to guess that, given a choice and as much information as we have at our disposal, most Rats would be smart enough not to sink the Ship while out at sea, just so they could have the smug satisfaction of deserting it.

I agree with the aardvark here.

Now, don't misunderstand me. The republicans, snakes that they are, talk a big game about this, but in the end they expand government, put it deeper into debt, increase military spending, and use the government to enrich themselves. They are more responsible for the sad state of affairs than democrats.

The whole thing needs to, and will, come crashing down.

If you want to stay aboard the Titanic, that's your choice.

By referring to the Titanic, are you not actually pointing to Space Ship Earth? IF the US goes under, it's likely that the other Capitalist nations will also. In that sense, there's no escape because there's nowhere else to go...

E. Swanson

How can anyone claim that capitalism is not crony because 40- 46% of GDP spending is governmental. Bailouts, forever wars, low interest rates, unaccounted for inflation, mortgage subsidies, socializing toxic debt to privatize profits are all examples of crony capitalism. The list is by no means complete. A shutdown would afflict pain no doubt, but the stupidity of up to three trillion dollars in off book debts added to $14.35 trillion in National debt today coupled with both parties married to crony capitalism forever plus trillion dollar deficits going forward for 10-20 years needs to be stopped. Now is as good a time as any.

Here is an argument I heard.

Countries compete against each other. So do companies. Therefore we shouldn't see much difference between a company and a country doing the work. Here are the equivalences: stock holders->citizens, board->congress, ceo->president, employees->civil service, unions->unions, shares->print money. The only difference is the greater amount of pride and loyalty that one feels toward a country rather than a company.

National debt is the currency of countries competing against other countries to see who will end up holding the short end of the stick. Put this together with the national pride and it is hard to explain -- on a rational and debatable level at least -- why we see so much antagonism toward a country building up a civil service worker base rather than companies leading the charge. So its socialism, so what? If a conglomerate gets big enough it is indistinguishable from a country. Its really only the multinationals that should care, as they may not want to play sides.

Having heard this argument prevents me from getting too wound up over trying to pursue a completely capitalist system. Countries emulate this kind of behavior fairly well on their own.

Oilman -

More and more the true motivations are becoming apparent. Walker in Wisconsin cut out that pesky little bit about "balancing the budget" and just passed a resolution against collective bargaining - the real goal anyways since few Republican in any level of gov't truly give a damn about budgetary matters.

The next step comes in Michigan where their governor elect is pushing a bill to hand over entire towns to "corporate control" to help them get their fiscal house "in order"... disaster capitalism is no longer just for third world countries halfway around the globe - these ghouls would never be happy until they could bring it back to the Homeland.

I can tell you that in the past few months my consideration of getting off the Titanic has taken on a much more serious and urgent vibe...


I am not fancy rebel advocating taking any action to promote collapse - our leaders seem to be doing all the right things toward that end. I just think it is best that collapse happens sooner rather than later. Also, I do not care what the current industrial rats think, how smart you think they are, or what choices they imagine they have and what power they imagine they have over collapse.

The Industrial countries have no intention of changing, and even if they did they are not cabable of changing. Instead, globally we have been, are now, and will continue to try to "outcompete and outlast" each other to see who is the last Industrial country standing.


The sooner the industrial countries collapse, the sooner we stop fueling climate change and the sooner we stop churning through precious resources trying to sustain a ponzi economy that benefits a very few people alive now.

The only people that have anything to fear are those still dependant on the Industrial Pigstye.

("This is not a surprize "pop quiz," said the Mother, "You had plenty of time to do your homeWORK - No more excuses and no make up tests - you read the syllabus. Now, clear your desk...")

hear hear!

To stretch a couple of other metaphors, it could be 'Atlas Shrugging' with the smart, productive people quitting in disgust, or the Samson bringing down the temple scenario thus destroying himself along with the Philistines in the temple.

...it could be 'Atlas Shrugging' with the smart, productive people quitting in disgust...

The smart people did it years ago and are reasonably established outside the system. The current slang is "gulching" referring to Galt's Gulch - do a search.

The sheeple can't seem to get it through their heads that BAU is dead and they are paying the price and will pay a higher price as time goes by.


Git 'R Done, and Shut 'R Down......

Trouble is, a shutdown would involve everything except the military. Then, as the chaos spreads, the military would be called upon to restore order. Sort of like Libya...

E. Swanson

I really do not know how it will play out, but that is one likely possibility.

Que Sera, Sera.

Well, he DID talk about increased use in China and India, although I suppose the direct competition with USA was only implied. At least he didn't use the word "speculators".

I was happy he was talking about it at all and didn't outright lie about how rosy our oily-filled future will be.

It was nice to watch it live. Does he give these mid-day speeches all the time? Usually, I'm at work but my office is in a tsunami hazard zone, so I'm taking the day off.

The latest wave damaged about 35 boats in the Crescent City, CA harbour, and a section of US HWY 101 was overtopped near Freshwater Lagoon, but otherwise, not much damage.

Of course, it was wave number four that took out Crescent City in 1964, and that one's not expected for another hour...

EDIT: to add 8.1-foot wave reported for CC, piers and harbour pretty damaged.

As usual, his statements will not satisfy the people here. But I think he did a good job. He pointed out that we have like 5% (or did he say 2?) of the reserves but burn 25% of the oil. He pointed out that he is working hard on production and mentioned that we've had a big increase in production. And he hammered on conservation, alternatives, efficient cars, electric cars, etc.

He said 2%, IIRC. Like I said, he danced around the issue. He knows we wouldn't be well served if he stampedes the herd. Just frustratin'.

I wouldn't know.

I never watch Obama, and I pay no attention to him whatsoever.

Obama is a tool for the banks and the military.

He's a meaningless puppet.

I voted for him and was quite hopeful when it became apparent that the nation had the courage to do that back in 2008.

But I can't see how his body of work thus far makes it possible to come to anything but that conclusion Oilman... he has had multiple, multiple opportunities to stand up for those who elected him and say enough is enough... his actions though indicate that he is clearly a tool...

Makes me laugh out loud whenever I hear one of my foaming at the mouth, brain dead countrymen describing him or his agenda as being socialist. That statement is so idiotic that the fact that this perception even exists was nearly enough to turn me into a card carrying doomer, without even accounting for the myriad other problems we face.

But I can't see how his body of work thus far makes it possible to come to anything but that conclusion Oilman

I think he isn't actually owned by plutocracy-inc, it just seems he is too timid to risk a confrontation, so instead he is a serial compromiser. Never mind that giving up ground piece by piece will have the same end effect.

Cat - I usually smirk more than laugh when folks go on about the "damn...fill in the blank: Rebubs, Dems, socialists, capitalists, etc". I know it simplistic and condemnds a very few who don't deserve it but for me it's the damn politicians. They've become so good at getting the population engaged in class warfare the public is completely blind to many of the great failures of the system and those in charge.

I assume Qaddafi can finish the job this weekend, while everybody tries to figure out the Japan thing.

P.S. How much oil is needed to rebuilt the effected area in Japan? Shouldn't we start pricing each problem in terms of bpd X days needed?

I assume Qaddafi can finish the job this weekend, while everybody tries to figure out the Japan thing.

I don't think the Europeans are prepared to let Gaddafi hold on to power. EU leaders called again today for a regime change. Neither Britain nor France are going to prop up what has proved to be an unstable and maverick source of irritation and trouble at the underbelly of the continent.

Enough is enough.

There may be divisions about what to do, but that won't stop the resolve to do something.

Will this happen on humanitarian grounds? No. Countries don't have morals. They have interests.

Libya's government, in the recent past, was secured by a mixture of consent and terror. If Gaddafi regains control, the only security possible will be through terror. The consent part will be long gone.

That's too unpredictable a formula for customers of black gold.

That's too unpredictable a formula for customers of black gold.

Ummm....but "regime change" isn't likely to be any more predictable.

If we break it and don't fix it, we may end up with another Somalia. Or with a regime that's worse than Gaddafi's - from a humanitarian and an oil-providing point of view.

Or with a regime that's worse than Gaddafi's

Is that even possible?

Put him back in place and Libya will be like Somalia.

Respectfully, European governments are tired of dealing with this crazed clown. Otherwise, I don't think the French and British would be pressing so hard for action.

Things can always get worse.

Likely they will.

"Crazed clown" Wow. He's definitely much worse than the other monsters we're only too happy to deal with. And how's his hit rate on wedding parties?

So you can't think of any other reason they might be pressing so hard for action then? None at all? I'm sure they're REALLY worried about the civilian population of Libya, and really tired of how how he's treating his people - yeah, that must be it.

I'll see your "Crazed Clown" and raise you one "Howling Hypocrite".

War Is a Force That Gives Us Meaning

Yes, a crazed clown that brought down an airliner over Scotland.

A crazed clown that after a time in the wilderness was rehabilitated for realpolitik reasons. Governments had to swallow their pride out of the need for accommodating what appeared to be an entrenched dictator who had the keys to much needed energy.

You need moral standards to be a hypocrite. States have interests, not morals. Hypocrisy is rarely a factor in international relations. Think more along the lines of "opportunistic".

Then the crazed clown wobbled.

A crazed clown who has now lost most of the territory of his country, the backing of key tribal leaders, and practical the entire educated diaspora and diplomatic corps. In order for him to regain power, he is going to have to reconquer. Do you think that the Libyans in the east will surrender without a fight?

He has the weaponry we sold him. But he has little else going for him.

There is no BAU in this case. A return to power will be bloody and protracted. Not good for business. Besides, he's hardly going to give up his terrorist and bullying ways. Opportunity is knocking. Better for the Europeans to get rid of a known trouble maker and bet on someone new.

He has the weaponry we sold him. But he has little else going for him.

It seems like the technology we have could enable us to embed a controlling microchip in the weapons we sell so that if we wanted to we could shut them down. Maybe this is too complicated for our military minds to grasp.

I always wondered about this, and I concluded that as soon as the dictator du jour discovered that his weaponry was adulterated he'd make sure he never bought from the supplying country again.

Bad for business in other words.

CNN reporting "major setback" for Libyan rebels. They appear to be fleeing the advance of the army en masse. The net has been taken down, so they can't communicate or organize.

And the UN thought there was a humanitarian crisis last week. Just wait until next week.

The rebels get to sabotage the energy infrastructure now in a guerilla-style war. Perhaps this will be worse for Libya. Hard to know.

Re: US farmers fear the return of the Dust Bowl

Information filled article on the depletion of Ogallala Aquifer.

He [T. Boone Pickens] is now the largest individual water owner in America.

He plans on selling it to Dallas.

It [irrigation system]measures the amount of moisture in the canopy, and takes a light-spectrum scan of each plant to determine its health, just as the gardener judges the colour of his leaves. This information goes back to the computer mounted at the well-head for even finer metering.

Technology will save us. Actually in this case it's just barely keeping the farm alive.

Smaller flows require finer metering ;)

I did not get the same message from the article. To me the article was a warning about a depleting resource. Did not intrepret any techo-salvation.

The opening statement was:

For years the Ogallala Aquifer, the world’s largest underground body of fresh water, has irrigated thousands of square miles of American farmland. Now it is running dry

This text also seemed part of the main theme:

Billions upon billions of gallons – or, as they prefer to measure it, acre-feet of water, each one equivalent to a football field flooded a foot deep – have been pumped. 'The problem,' he goes on, 'is that in a brief half-century we have drawn the Ogallala level down from an average of 240ft to about 80.'


"Technology will save us" was a sarcastic jab at technocornucopians, in case the second sentence didn't clue you in.

Look at the FoxNews picture of the refinery burning.

Japan now hit by a new 6.2 on the West coast, the others were on the East coast.
It will take years to rebuild their infrastructure if they can get the money.
Their debt is so huge is will take money from other countries to make it happen.
What does this mean for oil shipments to Japan?

Apparently, this was a black swan of sorts.

The 'Big One' hit, but not where they thought it would

Scientists today said the event has once again humbled them, reinforcing a growing sense that the field of seismology needs to ditch some of its presumptions about major earthquakes.

"It took place in a stretch of the coast of Japan that was not considered prone to mega-earthquakes," said Emile Okale, a Northwestern University geophysicist reached in Tahiti, where he was preparing to evacuate in advance of the tsunami generated by the Japan quake. He compared the Japan temblor to the huge Sumatra earthquake six years ago that generated the devastating tsunami along the rim of the Indian Ocean. That quake happened on what had been presumed to be a relatively quiescent stretch of a subduction zone.

"This is a continuation in a sense of the cold shower that we got in Sumatra-these mega-earthquakes take place in places we do not expect them. That means that on a global scale we should consider that all subduction zones are potential locations for such events," Okale said.

More proof that what we don't know can hurt us :-/

Not by definition a Black Swan, more likely a Gray Swan.

To first-order, earthquake magnitude distributions are very easy to model. It goes like this:
Stress is the force applied to a fault and the energy will keep increasing over time if not released.
Strain is the deformation of the material which will eventually slip causing the release of energy.

If both of these follow a random distribution with some mean average growth rate, and a mean breakdown region, simple probability and statistics will give very closely the actual distribution of magnitudes we observe. The ratio of stress and strain computed by considering maximum entropy dispersion gives the empirical power-law observed.

The bottom-line on eathquake magnitudes, is that whatever the magnitude observed there is always a finite probability of having an earthquake greater than the previous big one. That is the tail in the following curve.

Since this has a lot in common with the generation of super-giant oil reservoirs, I have a description of this derivation in "The Oil Conundrum". The diff is that we run out of super-giant oil, but we never run out of earthquakes. They have been forming and releasing in equilibrium for ages, in contrast to us finding and exploiting the super-giants as fast as we can.

Sadly, the earthquake is another one of those predictably unpredictable events. Like oil depletion, its just another one of those geology topics that is not taught well at a very basic fundamental level. IMO.

If earthquake "experts" really are surprised then their scientific standards must be poor. There are no observations of the interior of the Earth that would allow one to map or model the distribution of all the faults and their stresses. There are some scraps of information you can glean from the surface and seismic tomography but this data is too little to give enough information about where earthquakes can and will occur. Trying to, in effect, parameterize the earthquake potential distribution based on coarser variables only takes you so far.


Plus, the way that latent earthquakes build up in strength over time means that they aren't observed until they are released. It is a type of mass-action law for energy, you can either see lots of smaller earthquakes or one big one -- if the smaller ones are not observed, it could be that no earthquake potential exists in that area, or that the energy is building up for a massive one. How would they really know which is the case?

I have to agree that some simple logic and probability reasoning is missing from the expert opinion.

Well, I'm not sure the "lots of small ones will prevent large ones" argument is true. The large ones are just too much bigger. Thousands of 7's to equal a 9.

But I totally agree that huge ones are nearly impossible to predict. If you're sitting on top a subduction zone and things have been pretty quiet (maybe for thousands of years), does that mean it's a nice safe part of the zone, or does that mean the stresses are just building up to a huge release? Or, on a human scale, maybe both?

I would think that conservation of energy always wins in these cases and it certainly isn't subtractive. Doing the math it kind of jumped out at me.

And I agree with your second paragraph.

A 100-foot high tsunami possible in the Pacific Northwest?

Speaking of latent earthquakes and tsunamis, few northwest-coast U.S. residents are aware that we face the same, if not worse disaster than that which just struck northern Japan. The "Cascadia Subduction Zone" extends offshore from Northern California to British Columbia, and here's what geologists think about it's danger to the U.S. Can you imagine a 100-foot tsunami striking the California to BC coast minutes after a massive 9.0+ Richter-scale earthquake? (Fortunately, all of the major Pacific northwest cities north of San Francisco are actually inland with a relatively sparsely populated coastline.)

From Wikipedia:

Recent findings concluded the Cascadia subduction zone was more hazardous than previously suggested. The feared next major earthquake has some geologists predicting a 10 to 14% probability that the Cascadia Subduction Zone will produce an event of magnitude 9 or higher in the next 50 years,[9] although the most recent studies suggest that this risk could be as high as 37%.[10][11] Geologists have also determined the Pacific Northwest is not prepared for such a colossal earthquake. The tsunami produced may reach heights of approximately 30 meters (100 ft).[12]

I'm glad I live 15 miles inland and south of the Cascadia zone.


"I'm glad I live 15 miles inland and south of the Cascadia zone."

15 miles inland might not save you if you are only a few feet above sea-level. How high are you is a better question.

I'm at 150' elevation with several rows of hills reaching several hundred feet in elevation between my apartment and the ocean. That should stop the tsunami. With my luck, it would hit while I'm at the beach, but then, like most of the Sonoma coast, the beaches ares at the foot of 300' or higher hills, so I would be up the hill like a flash if I felt a major quake while at sea level.

Of course, considering the damage that the 7.7-7.9 magnitude 1906 SF earthquake caused, a magnitude 9 quake could still be devastating in spite of modern building codes. Towns like Mendocino and Fort Bragg would be swept right off their marine terrace locations.

Its possible that seismic waves passing through rock might be affected by the state of stress in the rock. So perhaps someday we will have decent stress maps. And GPS will eventually give us strain maps. But an area like this is underwater, which makes it pretty hard to do the geology needed to determine the detailed history of the region.

It actually takes a huge amount of small quakes to release much stress (compared to the big ones). There is also aseismic slip (where a fault moves slowly (over days or months) relieving stress that would otherwise have gone into a quake. The solid earth is a messy place. And fracture is frequently a chaotic process, so predicition is really difficult.

Japan earthquake factbox: Entire Japan coast shifted 2.4 metres, earth axis moves ten inches

* Earth's axis has reportedly shifted ten inches as a result of the quake, and Japan's coast is said to have permanently shifted 2.4 metres.

The "permanently" part is a little dubious!

Yes, everyone will get intrigued by this factoid, forgetting the fact that land masses as large as South America and Africa were at one time connected.

Well ten inches seems like it is large enough to make the geographic information systems people recompute the latitude and longitude of surveying markers. They would certainly have to do so in Japan.

M - Yep..."permanent" is a somehwat loaded word. To be generous we can allow that it's permanent with respect to a person's life span.

And on the Internet - anyone can claim whatever theory they want as to how that interconnection happens. Short version - Earth used to be smaller

The solid earth is a messy place. And fracture is frequently a chaotic process, so predicition is really difficult.

Yet that is what makes the magnitude distribution so easy to derive. You basically assume a huge spread in strain velocities and a huge spread in stress critical points and you end up with the power-law. The math derivation is almost trivial for this argument.

So that is prediction in terms of the range in earthquake magnitudes, but I do agree that any one earthquake is impossible to predict. That combination describes the predictable unpredictability of most mechanisms governed by entropy.

So "What" is easy.

That still leaves the important questions of "Where?" and "When?".
Those are quite a bit more challenging.

Something as seemingly simple as predicting the flip of a fair coin falls into the same category.

So you learn why it falls 50/50 first and then you decide how to apply the information. It may never be possible to go beyond that, even for something that appears so simple.

Coincidentally, earthquake magnitude is simply calculated by the well-known Odds function. The median sized quake will give even odds, and the odds get progressively smaller as the magnitude scales above this value. BTW, this is not in the Richter scale but in terms of actual energy released. Everyone in an earthquake area should at least learn to play the odds. Humans can learn this much like they can adopt gambling as a past time.

I just asked a student what is the number of flips required to see a HEADS and a TAILS 99.9% of the time.

It is unbelievably large the student said.

0.001 = (1/2)^N

N = 10 flips

Most people would underestimate this number unless they think very mathematically.

Some seismologist type on CNN says their best guess is that the earthquake was actually a 9.1 Holy heck, that's a monster.

Saudi protests fizzled. Maybe partly due to the police presence. Maybe partly due to the king's recent bribe.


A question here, and I ask b/c I don't have a foggy clue as to the answer:
Do we give too much credence to the discontent and restlessness of the Saudi people? Culturally and religiously, do the vast majority of Saudis respond with deference to the monarchy? I'm wondering, do their tribal loyalties preclude and mitigate against rebellion?

Could it be that contagion is not that much of a threat to the government in Riyadh?

Thinking back to the 1960s, Nasser was the darling of Arab nationalism. If memory serves me right, the Saudis were not all that impressed by him. Why would they be impressed by events in Egypt and northern Africa now?

Maybe the population was glued to their newsfeed websites, and thinking 'Maybe we don't have it so bad after all...'

Good post by Dave Cohen today on oil prices:


Quote from the above article.

"It does not get any clearer which way Wall Street is trying to take oil," says Stephen Schork, who writes the Schork Report energy markets newsletter in Villanova, Pa.

Schork notes that speculators now own nearly six times as many barrels of oil – 268,622 futures contracts representing nearly 269 million barrels – as can be stored at the WTI trading hub in Cushing, Okla. And since the CFTC numbers released Friday only go through last Tuesday, they likely underestimate the degree of speculative fervor building in the energy markets...

The speculative fervor is so remarkable that the big trading firms now have nearly twice as many long contracts open as they did in 2008, when oil spiked to $147 in the summer, a development that either foreshadowed or caused the global economic meltdown, depending on how you look at it.

Does anyone want to comment? I know that the issue of speculation has been covered numerous times in TOD.



Two contrasting stories about KSA
Its incredible that such a bizarre backwater country is so important to the world.

Risk of Nuclear Catastrophe Escalates in Japan – ‘Worse than Chernobyl’:


RT's take on the situation: This plant is far larger than Chernobyl and meltdown would be more serious. Analysis begins about half way into video.


It seems to be a long way from a meltdown situation. The coolant pumps run on steam. Electricity is needed for the control systems, e.g. to drive motors that operate valves.


Note that these reactors are obsolete US designs.

There has been an explosion at the plant, blowing the walls off the building. Government have confirmed there is a radiation leak. Seems a core meltdown is a possibility.

There are four nearly identical buildings at the site, and two more immediately to the north. I assume those are the six reactor buildings. The northernmost one of the south group of four is the one that exploded.

This is not looking good at all. I can only assume this was the reactor going high order as the pressure vessel failed, and steam flashed over. I hope the control room is in another building.

Sounds like a Chernobyl II in the making.
First they say no worries mate, relax, breathe deeply.
Next they say everybody within 10km of plant, get the f*** out of there.

I'm holding my breath here waiting for the global jet stream to bring that far far away stuff wafting to the shores of California and Eastward.

One news source (CNN?) was saying Japan gets 1/3 of its electricity from nukes.
Is that right?

Big big problem for Japan if they can't get those nuke plants up and running soon and if their refineries are all up in flames too. This is Apocalypse Now made all too real.

Evacuation zone now extended to 20km around plant 1 and 10km around plant 2.

Imperial College scientist saying that he thinks it quite plausible that the explosion was due to steam and that the risk of a large radioactive leak may be less than feared.

Backed up a bit by the following BBC quotes:

1103: Japan's Kyodo news is also reporting that the four people injured in the nuclear plant explosion are conscious and their injuries are not life-threatening.

1057: Japan's Nuclear and Industrial Safety Agency says serious damage to the nuclear reactor container is unlikely despite the explosion at the Fukushima-Daiichi plant - Kyodo news.

Let's hope they're right.

I think they are making it up as they go along.

Haha, in all likelihood!

The media is posturing. This is like early Katrina before the bowl was flooded. We have a major disaster on our hands.

Industry mixing with Mother Nature. Disorder will maximize itself here.

Man cannot defeat these things. No media assurances can thwart what lies ahead.

Yes, I think a steam explosion in the pump room is the most likely explanation. It would mean the cooling systems on the generator side of the heat exchangers have been destroyed and partial core meltdowns are in progress for all of the reactors. Maybe the pumps on the reactor side of the heat exchangers are still functioning allowing them to circulate sea water through the reactor core to cool them.

I wonder how big the evacuation zone will have to be in Iran if that Nuclear plant they are building for peaceful purposes we are told. That if my memory is built in an earthquake zone. I also don't think that the building standards will be has high as in Japan.

Apart from the laws of thermodynamics the only other law that I think is based on fact is Murphy's Law. Put in its simplest terms what ever cant go wrong will go wrong.

Don't worry - we have it on good authority that there is no leaks as the press has it wrong.....just read the posts here on TOD that make such a claim.

The only conclusion that I can come to is that one of the reactor containment vessels failed and as Paleocon suggested, pressure dropped in the vessel. This would cause the coolant (superheated water at this point) to flash off to steam. This is not only the simplest solution, it is the only one I can come to. They are claiming that this was a hydrogen explosion. Once again, the source of hydrogen was likely the coolant water and interaction with elements in the core (zirconium, other metals). Either way, things are going baddly wrong with this facility. This, IMO, is indicative of core damage. If this is the case, from an engineering standpoint, their ability to control the core is slim to none at this point. Praying I'm wrong.

Yeah, I'm trying to understand what they are claiming - the outer building exploded and they state that the containment structure did not. But that does not mean it's undamaged, and how are all the systems that were in trouble before working now?

Undertow posted above that they are pumping seawater for cooling. If they are to the point of using seawater to cool the core directly, they are desperate and things are much worse than reports indicate.

Yeah, it would seem that whatever problems they had before the blast would likely be worse now. Seawater does seem like a measure of desperation, but it's not my field.

One expert on Sky said they've basically written off the reactor and are flooding it with sea water and also using acid (cobalt?).

One report earlier was saying that some of the rods where exposed to air. I wonder what that means exactly?

Earlier, they were worried about how much water was over the rods. They said the rods being exposed to air wasn't a catastrophe...but it's not good, either. They were trying to pump water to keep the rods submerged.

If the explosion was in the pumping system, perhaps that's what led the water level to drop to the point that the rods were exposed to air.

Boric acid to quench it.

They are toast. They lost their control systems now. it is a matter of time.

Remember these reactors are too big to fail. Deep water oil wells are too big to fail.

Perhaps industry was built on a 20-30 year failure time horizon. Or worse, they have no idea what they are doing. No idea. I do not know.

I saw a statement (unsubstantiated) that after the explosion core temp dropped to 100C. If so, it was obviously a loss of steam pressure at work. Then, you have to replace water as fast as it boils off, which would match the seawater statement.

If it were a hydrogen explosion, then the core temp would remain the same, and the problem would still be to re-activate cooling flow and/or release in a limited manner.

Either way, it's not a good sign.

Shoutout to Merrill:

Stick with what you know. Don't believe what you're reading.

Unlike Chernobyl there will be no graphite fire even if the core is completely exposed. Since it is a negative coefficient light water moderated reactor it will cool down. Radiation will and has been released but nothing like at Chernobyl.

I was flipping through the channels whilst on the stair-stepping machine this evening and ran across this clown 'Kudlow' on CNBC.

He had some guy named Stephen Moore (former head of 'The Club For Growth', author of a books called 'Return to Prosperity'.

Kudlow and Moore had an absolute love-fest with each other whilst doing their best to convince their audience that the rising gasoline prices were part of a conspiracy led by President Obama, not due to supply and demand issues!

They said that there exists some kind of liberal plot to achieve the evil goals of reducing pollution and making nonsense alternative energy/fuels more competitive, and ultimately to fulfill their goal of reducing America's competitiveness and standard of living.

The call-out box on the bottom of the screen said Drill, Drill, Drill! They whomped on Obama for purposely denying permits for oil exploration and new coal mines so as to further his mad alternative energy plan.

Moore said that we have heard enough of this "Alternative Energy Garbage".

They quoted Bill Clinton as saying that we we need to get rid of these ridiculous oil drilling permitting delays:

Former President Bill Clinton said Friday that delays in offshore oil and gas drilling permits are “ridiculous” at a time when the economy is still rebuilding, according to attendees at the IHS CERAWeek conference.

Clinton spoke on a panel with former President George W. Bush that was closed to the media. Video of their moderated talk with IHS CERA Chairman Daniel Yergin was also prohibited.


Robert Reich was also on the show as the obligatory counterpoint whipping boy.

Reich asked Kudlow and Moore if it would be a good idea for the U.S. to take the global lead in no-carbon-burning alternative energy development, instead of letting China lead the way.

Moore then said "The U.S. does lead the way in natural gas production technology, and we are the Saudi Arabia of coal! Kudlow repeated: "The Saudi Arabia of coal!".

Now then, I flipped to watch some progressive shows (and I heard some liberal talkers previously on the AM radio today), and their talking point/meme was that oil prices had nothing to do with supply and demand, but of course were all due to the evil wall street speculators and their Republican sponsors/benefactors.

The tsunami of propaganda and illogical from both sides of our wonderful media circus made my freaking head spin.

Clowns to the left of me, Jokers to the right, here I am , stuck in the middle with you...

For your listening enjoyment:


Looks like I picked the wrong week to quit drinking...

New goal is to double my intake.

These clowns have so poisoned the debate that I really think there's about zero chance any rational energy policy even gets discussed before it's lights out...

As Westexas points out - these guys and all their disciples are about to get a heapin' helpin' of "energy independence".

Your plan to increase your ethanol intake will bring a smile to x's face!

Hey Heisenberg!

Clowns to the left of me, Jokers to the right, here I am , stuck in the middle with you...

Yesterday I posted a routine Kudlow has been doing all this week, trying his best to debunk the idea that higher oil prices could derail the economy. He'd invite several guests, then once he knew which one matched his opinion, he shouted everyone else down and let that person have the rest of the time to ramble on. Kudlow is a 9 year old in a 75 year old body.

I was out today and didn't catch Kudlow's crapola, but it sounds like he gave up on convincing the world that oil could not put a crimp in the economy after the Dow dumped 223 points the previous day, and decided to go on a conspiracy rant.

But like you mentioned there was also a left viewpoint conspiracy slant on oil price. Caught in the middle is right, as we here on TOD try to figure out why its so incredibly hard for people and MSM to accept that oil is a finite resource and all the easy, cheap stuff is gone? It seems to be too difficult to comprehend for most.

BAU must go on no matter how heavy the oil, how expensive the bitumen or high sulphur content the source might be. Just get it and make sure there's no conspiracies on the way to market so we can keep punching it to the floorboards, thundering down the road with our after market mufflers gurgling away, while drawing down a Fake McShake. Ahh, now that's the life!

Doesn't it make you just want to stop the BAU party now to see the looks on their faces?

Well said...true...and very disheartening.

Fact is that Kudlow is a former cocaine addict and his brain is likely destroyed.

Very few national liberal talkers deny peak oil, Thom Hartmann and Mike Malloy frequently discuss finite oil and believe in it. There are so few overall, so I can almost guess that perhaps you were listening to Bill Press or maybe Ed Schultz, who is more an ethanol shill than denier.

I could go on and on with all the national wingnuts who are deniers. On top of that, many of these believe in abiotic oil.

The really lousy medium right now is HuffPo who employ Raymond Learsy and other populists that Thom Hartmann could rip to pieces.

Big Eddie, yep. He doesn't get it at all.

The other two are pure comedians, not much serious thought or analysis: Stephanie Miller and Randi Rhodes. Blthered on about speculators...turned them off.

Thom Hartmann seems pretty intelligent...although I don't agree with everything he says.

Bill Press is on a little too early for me (can't receive AM radio in my shower...the local progressive AM station seems like it runs at ~ 100 Watts output and sounds like it gets jammed occasionally or just has third-hand crappy equipment (drop-outs, goes off the air for minutes-to-hours some time).

Miller's forte is pure politics and comedy. I hadn't heard her have a strong opinion on oil before you mentioned that. Thanks.

Her and her Mooks are good for some laughs, and they have some funny and intelligent regulars and guests who punch up the intellectual quotient ...Hal sparks and John Fugelsang come to mind.

Alan Grayson was funny and intelligent also nack when he made once-weekly appearances...'Face the Grayson'.

Chris Lavoi seems like a reasonable guy...Jim Ward is funny but has this bit of a conspiracy-monger thing about him.

Unfortunately Stephanie has just recently adopted what seems to be a somewhat coordinated liberal/progressive talking point about the price of oil being solely a conspiracy of evil wall-street speculators.

I enjoy the show as well. She has what I would call a target-rich environment and global warming deniers are more suitable for her to mock.

Thanks for the tune.. I'm dosing in rhythm.

We know what we need to do. Forget all these clowns.

20-meter displacement in 500-km fault seen as cause of Japan quake

TOKYO, March 12, Kyodo

A displacement as large as 20 meters in a fault around 500 kilometers long and 200 km wide triggered the magnitude 8.8 earthquake that jolted northeast Japan on Friday, a University of Tsukuba professor said Saturday.
''Many earthquake researchers did not expect such a quake to happen,'' he said, adding that he estimates its magnitude to have reached 9.0, compared to the 8.8 reading announced by the Japan Meteorological Agency.

Hope Pi is Ok;

She's in Japan isn't she? .. and there's one other regular who posts from there.. anyway, hope you guys are safe.


Defiantly seconding that. Thoughts to everyone else out there as well.


Libya’s Threat to World Economy Grows, The Wall Street Journal, March 10, 2011

Barclays said:
“Today has brought the first very visible manifestation in Libya of what is always fairly likely to happen when a conflict breaks out in an area rich with oil industry infrastructure. The large explosions and enormous columns of smoke from storage tanks and other facilities in Ras Lanuf, close to the Es Sider terminal, are perhaps more than merely symbolic. In our opinion, they represent a final fading of any residual realistic hope that the outage of Libyan oil could prove to be anything other than prolonged.”

The photograph at the top of the page with rebel forces in the foreground and thick black smoke billowing in the distance relates the future of Libyan oil exports poignantly.

Explosion at Japan nuke plant, disaster toll rises Yuri Kageyama, Associated Press, Published: Saturday, March 12, 2011 3:00 a.m. MST

An explosion at a nuclear power station tore down the walls of a building Saturday amid fears that its reactor was close to a disastrous meltdown after being hit by a powerful earthquake and tsunami.

Footage on Japanese TV showed that the walls of one building had crumbled, leaving only a skeletal metal frame standing. Puffs of smoke were spewing out of the plant in Fukushima, 20 miles (30 kilometers) from Iwaki.

The explosion occurred at Unit 1 of the Fukushima Dai-ichi nuclear power plant.

Video of the explosion at Russia Today's You Tube site

Radiation leaking from Japan's quake-hit nuclear plant, Reuters, Sat Mar 12, 2011 11:35am GMT (04:35 MST):

"We are looking into the cause and the situation and we'll make that public when we have further information," Chief Cabinet Secretary Yukio Edano said after confirming the explosion and radiation leak at the plant.

Edano said an evacuation radius of 10 km (6 miles) from the stricken 40-year-old Daiichi 1 reactor plant in Fukushima prefecture was adequate, but an hour later the boundary was extended to 20 km (13 miles).

All 13 diesel generators failed so the Emergency Core Cooling System is without power unless other backup has been found or the generators have been restarted. Detail at 3:15 into this video:


More discussion above in drumbeat. Japanese Cabinet Secretary said explosion was caused by "the walls falling down" (NHK translation). I think he may have that backwards.

Seawater is now being pumped into the reactor.

Think the rest of the world will not be affected by the disaster(s) in Japan? Think again. Chalk this up to the dangers to living in a JIT delivery world:

Quake Disrupts Key Supply Chains


Plants don't appear to have suffered widespread, catastrophic damage, but production delays could be enough to affect some tightly calibrated industries.

The earthquake affected operations at dozens of semiconductor factories, raising fears of shortages or price increases for a number of widely used components—particularly the chips known as flash memory that store data in hit products like smartphones and tablet PCs.


"This could have a pretty substantial impact for the next quarter on the whole supply chain," said Len Jelinek, an analyst at IHS iSuppli, a market-research firm that focuses on the electronics industry.


"They will have enough components for a day or so, but the big question is how badly the supply chain has been affected,"

"particularly the chips known as flash memory that store data in hit products like smartphones and tablet PCs."

That's hardly a problem, more like a benefit. Should slow down the assimilation of humans into the Borg collective.

I used to service a make of printer when the supply of spare parts suddenly dried up. It turned out that the company was in Kobe and was damaged by the quake. The whole supply chain was based JIT and only small small quantities held so, when the factory stopped, the whole supply pipeline dried up very rapidly.