DrumBeat: December 22, 2006

[Update by Leanan on 12/22/06 at 1:27 PM EDT]

Podcast: Down to the Last Cheap Drop

Falls Church News-Press peak oil columnist and former CIA analyst Tom Whipple discusses peak oil with retired State Department analyst George Kenney.

We Don't Know Jack

Sometimes I feel sorry for journalists on the energy beat. Most of them are your basic college-educated, liberal arts generalists, with a flair for communication but not necessarily math or science.

Unfortunately, in a world waking up to the fearsome reality of peak oil, good numbers are hard to come by. This is especially true in the oil business, where “tight holing”—keeping information top secret—is a term as old as the business itself.

Plant trees, disband the army, work together: the Tuscan way of surviving collapse

But not all societies collapse so completely. There are cases in which a society manages to contain decline and to keep its structure, its traditions, and its way of life. One may be the decline of Tuscany after the great expansion of the Renaissance, a case that had many points in common with the fall of the Roman Empire, but which was not so abrupt and devastating. Centuries of history are a complex story to summarize in a few pages but, as a Tuscan, I think I can at least sketch the main elements of what happened in Tuscany after the start of the decline, around the end of the 16th century. From this story, perhaps we can learn something useful for us today.

Total Oil Field Under Scrutiny

Total's license to extract oil at its Kharyaga field, its biggest Russian project, will be reviewed Friday by the country's subsoil resources agency as the government tightens pressure on foreign-led projects.

Opec nations raising oil prices in budgets

LONDON: Most Opec producers have for 2007 raised the oil prices on which they base their budgets, reducing the amount in reserve, as they grow more reliant on ready cash.

UN poised to pass Iran sanctions despite threat

Iran has threatened immediate retaliation, even though the proposed sanctions have been significantly watered down this week. Tehran's options include withdrawal from the International Atomic Energy Agency, the UN nuclear watchdog, which would mean Iran would conduct its nuclear programme free from international monitoring, and possible closure of the Strait of Hormuz, the channel for 20% of the world's oil supplies.

Raymond J. Learsy: Finally, Wisdom in Washington On Our Oil Future

During this holiday season, I bring you tidings of great joy: Finally, an organization in Washington comprised of Americans of standing and competence that is speaking the truth about our precarious supply of oil and what we should do to meet proliferating threats around the world. The only real and lasting solution to energy security, these wise men proclaim, is to change consumption patterns here at home.

India: We are hungry for more energy

“India’s petroleum consumption is growing at 3-3.5%. Growth is likely to be 4-4.5%, going forward. Growth had slowed down in the past few years because of increasing efficiencies, new pipelines and substitution by LNG,” says BPCL’s chairman and MD Ashok Sinha.

Corn Again: 3 Reasons Ethanol Will Be Back

Stock prices are down and analysts are pessimistic, but a few recent announcements give reason for optimism.

Biofuel cash nice but farmers worry profits won't materialize

SASKATOON - The federal cash promised for Canadian biofuel development impressed proponents of increased renewable fuel use in Canada, but some caution was also expressed Wednesday that farmers could still see themselves shut out of the profits.

Windmills vs. Photovoltaics

Because the price of photovoltaics continues to drop - thin film costs are already approaching the magic $1.00 per watt level - combined with lower maintenance costs compared to windmills, our money is on photovoltaics.

Canada's cutting-edge energy model

...the wind farm is part of an ambitious plan to enable Prince Edward Island (PEI) - which has no significant coal, petroleum, natural gas, or hydro resources - to meet most of its electricity and 30 percent of its total energy needs from its own renewable resources by 2016.

Energy efficiency builds a new clientele

Builders and home buyers across the country are increasingly interested in so-called "zero-energy" or "green" building.

Incentives on Oil Barely Help U.S., Study Suggests

WASHINGTON — The United States offers some of the most lucrative incentives in the world to companies that drill for oil in publicly owned coastal waters, but a newly released study suggests that the government is getting very little for its money.

Nukes aimed at oil sands

Nuclear power in the oil patch is just a matter of time, according to Canada's Natural Resources Minister Gary Lunn.

Iran turns from dollar to euro in oil sales

Iran is selling more of its oil for payment in euros than dollars as it seeks to shift its foreign currency reserves away from the depreciating currency of its political enemy, the United States.

New German community models car-free living

Chris Skrebowski: Open letter to Peter Jackson of CERA

I was surprised and somewhat saddened to read CERA’s curious attack on the concept of Peak Oil and the implicit attack on the Peak Oil community in your recent press release and report ‘Why the “Peak Oil” Theory Falls Down – Myths, Legends, and the Future of Oil Resources.

Weekly Offshore Rig Review: It Was a Very Good Year

With the final days of 2006 upon us, we will be taking a look back over the last twelve months to see what changes and trends have been occuring within the offshore rig fleet. This will be the final Weekly Offshore Rig Review of 2006, so we hope this year-end review is helpful and informative.

North Sea Energy Upstarts Teach an Old Dog New Tricks

Despite being one of the most heavily explored and exploited hydrocarbon basins in the world, leading figures in the offshore oil and gas industry say there are still riches to be extracted from beneath the North Sea. In many cases it is small independent oil companies that are proving them right.

Oil prices to remain high but below 2006 records

The record oil prices of 2006 are not expected to be repeated in 2007 but they will be high enough to fill the coffers of the oil companies and draw the ire of motorists.

Uganda: MPs Attack Govt Over Power Exports

UGANDA still exports electricity to neighbouring countries despite a crippling power crisis in the country, findings of a parliamentary committee have revealed.

A report by the Parliamentary Committee on National Economy assessing the current status of the economy shows that despite a deepening power shortage, partly due to low water levels, electricity exports to foreign countries have increased by 17 percent.

Hoping to head off crisis, Energy regulators keep an eye out for suspect trades

Every weekday morning, government analysts gather inside the headquarters of the Federal Energy Regulatory Commission to scour the nation's energy markets for fraud.

California regulators issue solar energy guide

SAN FRANCISCO - The California Pubic Utilities Commission on Thursday issued requirements and other details for a new energy program that aims to make the state one of the world's biggest producers of solar energy.

So Cal Ed signs biggest U.S. wind contract

LOS ANGELES - Electric utility Southern California Edison and Australian-based Allco Finance Group Ltd. have signed the biggest contract for wind power in U.S. history, the two companies said on Thursday.

Climate Change vs Mother Nature: Scientists reveal that bears have stopped hibernating

Bears have stopped hibernating in the mountains of northern Spain, scientists revealed yesterday, in what may be one of the strongest signals yet of how much climate change is affecting the natural world.

Gazprom grabs Sakhalin gas stake

State-owned Russian energy giant Gazprom has wrested control of a massive oil and gas field from Anglo-Dutch rival Shell.

Foreign oil facilities in Nigeria seized

LAGOS, Nigeria - Armed men attacked two foreign oil facilities in southern Nigeria on Thursday, and both shut down production following the assaults in the restive, oil-rich region. Royal Dutch Shell PLC, which came under attack earlier this week, began evacuating families of foreign workers, citing worsening security.

Oil hit a three-month high, then fell as traders dismissed the drop in inventories, attributing it to fog-related shipping delays.

Agency notes fear among nuclear plant workers: N.Y. workers afraid to raise safety issues, industry watchdog says

WHITE PLAINS, N.Y. - Some workers at a nuclear power plant complex just north of New York City are reluctant to raise safety concerns because they fear retribution, the Nuclear Regulatory Commission said Thursday.

All at sea for Christmas? Rig workers celebrate early

I posted this late last night but because I wanted to make sure everyone who gets The Science Channel had a chance to watch it, I am posting it here. The show:
What If: The Oil Runs Out came on last night and it was great. It will be rebroadcast today at 2PM Eastern time and the same time again tomorrow.

Actually the show only touched the tip of the iceberg. It showed only the very beginnings of the problems if oil runs out. It stopped way short of showing the problems a few years down the road, well after peak oil. And of course they used the term "Oil Runs Out" instead of "Peak Oil". I did not like that at all, but the public is only becoming aware of the problem, so this kind of thing is to be expected. Anyway here is the post I posted last night:

I just watched What if: The Oil Runs Out on the Science Channel. It is supposed to take place in Minneapolis and ANWR in 2016. I thought it was really great. No stupid cornucopians saying we still have 30 years before the peak. Though I do think 2016 was a bit optimistic.

At any rate, they were drilling in ANWR and found 16 feet of oil bearing rock instead of the 200 they were expecting. And this line, or pretty close to it anyway, was spoken by the narrator: "People don't realize how modest the contribution of ANWR would be under the most optimistic of circumstances."

It will be on later in the morning and tomorrow afternoon at 2PM Eastern time and again at 2PM Saturday.

Matt Simmons had a large part in the narration also.

Ron Pattterson

Seems to be the same as this BBC production?


also mentioned previously here


It's on now (10am ET).
In Houston DTV. its on at 1 PM local time.
I'd like to see this.  The BBC probably did a better job than CNN.  

I don't get the Science Channel, but it will probably air on the Discovery Channel eventually.  

Pardon me but was this pointed out in the last two days or so?


Urbansurvival pointed out that this OPEC report just releaed a few days ago mentions peak oil eleven times.  The report on PO start on pg 60 and is headlined, "Examing the end of cheap oil"

It's a major step if you ask me, but I've been bust and didnt know if this was mentioned or discussed here yet.  Curios on the thoughts of the members as the transition digs in IMHO.  PO is here people.

Dave discussed it some in his article about Angola and OPEC.

You might also be interested in Jerome a Paris' article at dKos.

Um, no.  Not on the last two days.  It was discussed three or four days ago, though.  ;-)
Leanan, the "Finally, Wisdom in Washington On Our Oil Future" link seems to be messed up - it points to today's drum beat.
Thanks.  It's fixed now.  
about the nyt article on gom deep water royalty incentives   a couple of things come to mind     1) this consultant arrived at "projected future reserves" of 57 billion barrels with the incentives and 56 billion without      one has to question the methodology   like making a "shaved beef" sandwich with a meat cleaver   2) the claim that oil companies pay 40% of revenue in royalties and taxes..........yeah  right
2) the claim that oil companies pay 40% of revenue in royalties and taxes..........yeah  right

OK, how much do they pay?

"ok, how much do they pay?"    you tell me     but before we get into this discussion    i can tell you that i have a contact within the irs   and   guess what    when an oil co disputes a tax law or tax ruling    the irs in most cases just rolls over and accepts the companies interpretation     you see the majors have much better tax attornys than the irs       they wrote most of the tax laws
you tell me

So you don't actually know? I thought you must when you commented on it. You can look at the annual report of any major oil company, and it will list all of their (audited) cash flows. If I recall correctly, XOM made $37 billion last year, but income taxes alone were over $100 billion.

i can tell you that i have a contact within the irs   and   guess what    when an oil co disputes a tax law or tax ruling    the irs in most cases just rolls over and accepts the companies interpretation     you see the majors have much better tax attornys than the irs       they wrote most of the tax laws

My second cousin has this friend, who knows a guy, who overheard his stepmother tell someone that your contact is just making things up.

robert  i dont give a shit if you believe me or not  in fact if am beginning to think you are a lot of hot air but that is beside the point  

exxon's latest annual report (2005)  lists revenue of $ $ 371 billion    and income taxes of $ 23 billion   or about 6 %     add that to 12.5 % royalty on federal leases and  you get less than 19%   (or 23% at 16 % royalty)  now before you get all huffy     yes i KNOW that exxon is a multinational   and this may not reflect the situation in the gom      but    tell me    robert  what % of royalty and taxes does exxon pay ?

robert  i dont give a shit if you believe me or not  in fact if am beginning to think you are a lot of hot air but that is beside the point

Wow, it didn't take you long to deplete your intellectual arsenal and go for the ad homs. Let's review. A story says oil companies pay 40% of revenue in taxes and royalties. You dispute this, with a "yeah right." Me, thinking you may have some special knowledge of this, ask how much they do pay. You indicate that you don't really know (and cite secret sources), demonstrating that you in fact were blowing hot air.  

but    tell me    robert  what % of royalty and taxes does exxon pay ?

You tell me, since you were the one that disputed the number. If I have time later (I have a 4-year old crying for me to play with him) I will try to find out what the $100 billion represented. That may have been taxes plus royalties, and I have it around here somewhere. But typically, the person making a claim or insinuation is expected to support it when called upon. That would be you in this case.

Happy Holidays.

go ahead do that   but you could save some of your precious time by going to the annual report filed with the sec   revenues $ 371 billion      income taxes $ 23 billion   (downloading the annual report to stockholders   takes tooooo   long   20.75 KB)

the holiday(s) has(have) already passed  (winter solstice) but you have a happy whatever

go ahead do that   but you could save some of your precious time by going to the annual report filed with the sec   revenues $ 371 billion      income taxes $ 23 billion   (downloading the annual report to stockholders   takes tooooo   long   20.75 KB)

Oh, I have that. Would you like to point out the section that refers to royalties?

Bottom line? Your comment "the claim that oil companies pay 40% of revenue in royalties and taxes..........yeah  right" was nothing but hot air. You don't actually know, so you have no basis for your "yeah right." And the reason I take exception to comments like that is that my industry has enough of a public relations problem without unwarranted assertions being made. Those unwarranted assertions merely help direct more hate at the industry. So, when you make comments like that, I will often ask for support. If you don't offer the support, and instead resort to name-calling, then that really tells us all we need to know about the assertion.

OK, had a little bit of time. From XOM's 2005 financials, they had revenues of $359 MM. They paid income taxes of $23 MM, excise taxes of $31 MM, and "other" taxes of $42 MM. My guess is that the latter category covers things like property taxes. Now, I agree that they only collected the excise tax. However, it is included in their revenue, so it is valid to include this tax as being paid as a percentage of their revenue. So, we have $96 million of their $359 million - 27% - being taxes of one kind or another, and we still haven't considered royalties.

I don't see that the 40% claim is out of the question. Again, if you have information to dispute the claim, please present it.

property taxes on gom oil leases .............. yeah   right
excise taxes on gom oil leases.............. another BIG   yeah right  
If "yeah right" is the best you can offer to those numbers taken directly from their financials, then I think we are done here. You have demonstrated very clearly that you can't support your "yeah right" with anything by more incredulity.
ok are you claiming that property taxes are paid to the federal government?
and yes some of the excise taxes can be "attributed" to production from oil and gas on federal  leases    but some, probably most, of these "flow through" taxes are from refined products are derived from foreign sources  and other oil and gas refined by exxon  
 are you claiming that all the excise taxes are "attributed to" production from federal owned leases ?  
and where did you get the $359 billion revenue figure?  my $ 371 billion came from the annual report filed with the sec
Last post from me, as it is apparent that you are not going to offer any support for your skepticism.

ok are you claiming that property taxes are paid to the federal government?

No, but you didn't say the federal government. I was responding to your claim, which was "the claim that oil companies pay 40% of revenue in royalties and taxes..........yeah  right". To be specific, the article said:

In the United States, the federal government's take -- royalties as well as corporate taxes -- is about 40 percent of revenue from oil and gas produced on federal property, according to Van Meurs Associates, an industry consulting firm that compares the taxes of all oil-producing countries.

In fact, it would be hard to pin down exactly how much of the revenue from federal lands they pay in royalties and taxes. However, the corporate tax rate is 35%. For the oil they extract and sell, they are going to pay 1). Royalties, and 2). Corporate income tax of 35% on the actual income from the sales. Again, it doesn't appear to me that 40% warrants any skepticism.

and where did you get the $359 billion revenue figure?


That is total operating revenue. But it's apples and oranges anyway. What is needed is the revenue from federal property, if that is the claim you take exception to.

Now, since you have never presented any numbers that would dispute the claim of 40%, I am done here.

i referenced the article in the nyt robert     and now you claim that i didnt specify the federal govt ?   did you just have a rosanne rosannadanna moment ?      
i referenced the article in the nyt robert     and now you claim that i didnt specify the federal govt ?

And yet you used not revenues from federal lands, but total global revenues (which include collected excise taxes!) to make your point. Go figure.

Since I hate to waste time, here is how a productive exchange could have gone.

You: 40%? Yeah right.

Me: How high do you think it is?

You: I don't know, but 40% seems high.

Me: Why do you think this, given that U.S. corporate taxes of 35% plus royalties must be paid?

You: OK, so maybe 40% is in the ballpark.

Instead, we were treated to a bit of burden-shifting, tapdancing, handwaving, and needless insults, when the bottom line was that you really had no basis at all for your skepticism.

corporate income taxes are NOT 35 % of revenues  
robert are you becoming delirious?     that 40 % is   taxes and royalties     now i showed you where exxon (since you brought up exxon)   paid about 6% of revenues in income taxes    and if you have a figure of other than 12.5 to 16 % in royalty  i would be glad to see it  but that is what the article states  (12.5% is standard)       so    w h e r e ' s   the  b e e f ?      

p.s.  and your whining  about the bad press  (your) industry gets    is ........................  well it's not very becoming   for a big shot oil executive like you

robert are you becoming delirious?     that 40 % is   taxes and royalties     now i showed you where exxon (since you brought up exxon)   paid about 6% of revenues in income taxes    and if you have a figure of other than 12.5 to 16 % in royalty  i would be glad to see it  but that is what the article states  (12.5% is standard)       so    w h e r e ' s   the  b e e f ?

See my numbers above taken directly from their financial statements. 27% of their 2005 revenues were paid as taxes of one form or another. This doesn't include any royalties. Your disbelief is entirely unjustified.  

p.s.  and your whining  about the bad press  (your) industry gets...

Nobody is whining. I am addressing your misrepresentation. As I said, we have enough bad press without needing you to start making stuff up.  

I've found RR's posts to be quite educational and factual, and I sincerely hope you and others like you don't drive him away.

I don't understand why you despise the hand that feeds you so virulently that you feel such a need be so viciously ad hominem.

I'm surprised delusional and dragonfly41 haven't somehow found a way to link me to elwoodelmore :P
You surprised me. Usually by now those who started out as you did and had their hides nailed to the barn door would have fled for easier pickings elsewhere.

You stayed.


I don't believe I have had my 'hide nailed to the barn' so to speak.  People are vocal about their dislike of my opinions, but it doesn't bother me.  I think TOD would be a worse off place if I wasn't as vocal as I am.  The 'overwhelming consensus' on every issue is ridiculous.  No one seems to want to challenge the status quo so I guess I'm nailing myself to the proverbial cross, all in the name of playing the Devils Advocate :P

But the other thing about TOD - reality counts, apart from anyone's viewpoints.

You are correct in assuming you play a role in questioning various perspectives - but to the extent those perspectives are based on things like geological science or chemistry, they aren't really open to dispute.

This is a place where it comes down to what comes out of the pipeline, and for the last, oh 12 months and counting, there isn't noticeably more coming out of it than before. Of course, like Godot, maybe tomorrow.

Why the amount hasn't increased is the pivot of this discussion, which naturally leads to what that means.

Living in Germany, I tend to the Kunstler perspective - don't live in spread out suburbs without any local agriculture, but that solution is not available in North America, in my eyes. Which is why so many of the non-doomers are so big on finding some method of mobility that allows suburbia to continue - without generally even dealing with the fact that any plug in vehicle will only work by improving on the incredible waste in personal transport - but when tranporting 40 tons of food 50 miles to a big box store, a plug in solution isn't likely to work very well.

Nothing wrong in having a viewpoint, but I don't think there is the broad consensus you assume, even in terms of the correct term to apply to your posting - most people have learned to live with you, after all, because at times, you have added something useful to a discussion. That is what makes TOD useful, till now.

review the thread
Sorry, maybe I'm dense, but while the thread certainly lays out an exposition of the hatred, I see nothing that illuminates the underlying why. The hatred just is. Now in the absence of illumination, I could speculate - for example, corrosive envy by the unsuccessful for the successful, as measured by any yardstick whatsoever from money to sainthood, has been commonplace from time immemorial - but after all it would only be speculation and it might be impolite to go into it deeply.
yes, you are dense
To be fair Robert, you were being snide being he threw in the angry ad hominem attack:
"My second cousin has this friend, who knows a guy, who overheard his stepmother tell someone that your contact is just making things up."

In fact, I think he took your little quote above as an ad hominem attack, so he fired back.  Seriously, I understand that anecdotes aren't evidence, but you weren't exactly cordial in your response ;)  But obviously you have a superior intellect, and are pure as an angel's semen.

To be fair Robert, you were being snide being he threw in the angry ad hominem attack:

I responded to an anonymous "cite" with my own. Just pointing out the value of using this kind of "evidence" to support your point.

In fact, I think he took your little quote above as an ad hominem attack, so he fired back.

In my experience, many people don't really understand what constitutes an ad hominem attack.


... and maybe they do not know what it means.

Sorry, your link does NOT give the proper definition of ad hominem

"... marked by or being an attack on an opponent's character rather than by an answer to the contentions made."

This is ad personam not ad hominem, ad hominem is questionning the logical consistency of the opponent, not being offensive which is ad personam.

Elwoodelmore, have you a clue as to what "royalties" are? That is what companies pay the nations for the oil they pump from beneith their soil. Remember the oil belongs to these nations, not the oil company. And you think it might be less than 40%?

Actually I have no idea what they pay but I would wage a lot of money that it is more than 40%. And then they still must pay taxes on top of that. I would think an estimate of 40% for both taxes and royalties would be way too low.

Ron Patterson

darwinian   ALL the royalties that i pay to the federal government (and mind you they are not major are 12.5 % )   so yes i do have a clue  
darwinian   ALL the royalties that i pay to the federal government (and mind you they are not major are 12.5 % )   so yes i do have a clue

Elwoodelmore, this sentence, if you can call it a sentence, makes no sense whatsoever. What on earth does this have to do with what Shell or Exxon pays Nigeria or Russia, or what BP pays the US in royalties?

Really, I do not think you have a clue about anything. You just try to make someone else look silly but only succeed in making yourself look ridiculous. No, absolutely not, you do not have a clue! Why do you pay the federal government royalties? Do you think that Shell could get away with paying Nigeria 12% of the price of a barrel of oil for their oil?

And apparently English is not your first language because this broken English of yours simply cannot be understood. You need to get a good tutor to help you with English composition.

Ron Patterson

the discussion (or at least the one i was involved in and you responded to) was regarding royalties paid by oil companies to the U. S. government in the gom (gulf of mexico)......and what the hell does this have to do with exxon or shell and nigeria or russia ?    ok  so you had a rosanne rosannadanna moment .......   you have no business attacking  me      
how much $$$,$$$,$$$ was it you wanted to wager ?
A truly fascinating question - according to ExxonMobil's last shareholder magazine issue, sales tax certainly seems included in their definition of tax - of course, ExxonMobil doesn't pay sales tax on what it sells, its customers do - but it is a neat way to add an extra quantifiable +5% to their idea of 'tax burden.'

Personally, I think any profit driven business will do its best to maximize its profits - then the question comes down to the morality of those responsible for the company - Enron comes to mind, those poor innocent executives being pursued by a vindictive government - or at least that is what Lay et al seemed to tirelessly repeat.

No business pays the tax on what it sells. It's always the buyer who pays the tax and if the buyer didn't, then the seller wouldn't be in business very long. But if you view it from the perspective of who collects the tax money and sends it to the IRS, then yes, it is the seller, or in this case XOM.
If all businesses passed on their entire tax burden to their customers then they would have no objection to raising taxes on business.  A sales tax is a tax on customers and the reason business supports a national sales tax.  Other taxes are not totally passed on.  Some businesses will absorb the tax on a unit of their production in the hope of increasing the number of units.  That is why businesses are opposed to any corporate income taxes.
It's always interesting how people read the concerns of their own time into history.
The traditional attitude to Tuscany's decline was to blame it on the fall of the Florentine republic, on Spanish and autocratic domination.
Now people see environmental problems that few used to discuss.
I don't in general think that ecological determinism is particularly helpful in historiography.
Do you think that energy is important to societies?  In societies where all energy came from agriculture and silviculture, do you think understanding the flows of energy through this resource base is unimportant?  
I don't in general think that ecological determinism is particularly helpful in historiography.

Smekhovo, I racked my brain but still cannot make heads or tails of the above statement. That there have been ecological causes of the decline of civilizations is something that, in my opinion, simply canot be questioned. Over cutting of the forest, over planting of the hillsides and overgrazing definitely changed Asia Minor, (mostley Turkey) from a lush forest to a semi arid desert. The same can be said about Ethiopia, Somalia and many other places on earth. Southern Mexico is fast changing from a former rain forest to a rocky, overfarmed and vastly overpopulated area.

Okay, all this we are all very familar with. But I just do not understand your use of the term ecological determinism here. Exctly what do you mean?

Ron Patterson

You should always be careful that your explanation would not explain equally well another result than the one you got.
This caveat applies as much to ecological one-size-fits-all explanations as to sociobiological ones, for example.
It's always easy to find an item of evidence that can fit preconceived ideas.
Well hell! I actually expected an explanation. But now I get it. The fall of cities, nations and empires is always due to political or religious reasons, never ecological reasons. That is totally and completely absurd!

Ecological destruction has been the primary cause of the fall of civilizations, including the Maya, Easter Island and yes, even the city states of the Mediterranean. And I suppose you think the Biblical city of Ephesus was abandoned for political reasons?

One of the colonies used to gain shipbuilding lumber was Ephesus on the western coast of Turkey. By the fourth century, BC the harbor was so silted because of deforestation and soil abuse in the uplands that the harbor had to be moved farther along the coast. The new harbor quickly filled in and the location now is three miles from the Mediterranean. In Italy and Sicily soil destruction has been epidemic. "The Italian coast from south of Ravenna; north and eastward almost to Trieste has been extending itself into the Adriatic Sea for at least twenty centuries," one scholar reports. The city of Ravenna, once on the coastline is now six miles inland.

Ron Patterson


That is one reason I disagree with Tainter about the overwhelming and unique importance of increasing complexity as leading to the collapse of societies. Lots of causes (as Diamond points out) can contribute to the collapse of societies, and destruction of the environment (even by simple societies) is one of the leading factors that tend to cause collapse.

Respectfully, there is the case to be made that highly complex societies are less resilient to the impact of enviromental degradation, among other stresses.
There is that case to be made, but I don't buy it. Look for example at the societies Diamond discusses in "Collapse." I think that in not a single case was increasing complexity a major factor (or any kind of factor in most cases) in causing the collapse.

If nothing else causes a society to collapse, then eventually increasing complexity may do it in, but if I had to list the One Biggest Factor, I'd probably nominate deforestation. And note that quite primitive societies that use stone axes and fire can destroy their forests and topsoil, though it is more common in relatively advanced horticultural and agricultural societies.

IMO the complexity of modern societies makes them better able to cope with change than are simpler societies. Just introduce a single new element into a tribal society (e.g. the classic "Steel Axes for Stone-Age Australians" by L. Sharpe) and you can utterly destroy the society.

I agree. In this theroy there is this hidden assumption that complexity equals to robustness and lack of adaptivity.

I don't buy it. For me there might be some correlation between the two but it is far from functional. Take the Roman Empire for example. In my history classes they explained the success of the Eastern Empire (Byzantium) vs Wester Empire with the following: The Eastern empire had much more versitile societal structure. It had many social groups whose relations and legal status were complex by necessity. But this versatility was the key to success and to adaptivity to the changing environment. A dynamic social structure is more adaptive than a centralised and robust hierachical one.

So if there is one comon thing between successful vs unsuccessful societies it would be versatility. A society must allow and encourage innovation, different thinking must be allowed and taken into account (not like the one here which is for the most part ignored). Versatility does not necessarily require complexity but may also require some. The two are quite weakly correlated in my view. Versatility also means tolerationg quite a bit of "inefficiency" and "redunndancy" in the society, for the basic reason of keeping it on guard and prepared for the future changes and failures which will happen inevitably. This incidently is a key for the long-term survival of any species.

Simple societies are almost invariably ruled by tradition--not by command (government) nor by the market. Because tradition works well to adapt to stable conditions, it can be very durable--provided nothing rocks the boat. However, when a new invention is introduced or a new enemy encountered, the traditional wisdom may prove worse than useless.

Some anthropologists have speculated that the hunting and gathering way of life was destroyed by bows and arrows and spear throwers (atlatls). With more powerful means of hunting, men killed off too much of the game, and due to population pressure horticulture was forced onto societies so as to be able to survive in a sparse game environment. Note that horticultural or agricultural societies destroy hunting and gathering societies when they come in contact.

In other words, complexity rules while simplicity is defeated--time after time after time. Ask the Native Americans . . . .

One form of agriculture may be much more ancient than the cultivation of grains.  Small gardens tended by a clan's women may be older than our species.  The plants that grew from the seeds in the neighborhood dung pile to deliberately removing those seeds before ingestion is not that big of a step. Even the creation of sterile hybrids of figs predates the cultivation of grains.

Chapter 7 of Diamond's "Guns, Germs, and Steel" is about this. I'm finally getting around to reading it.

Don mentioned that complexity beats simplicity time and time again. It's also place and place again. Ronald Wright points this out in "A Short History of Progress." This is a nice, brief read somewhere between Tainter and Diamond's "Collapse." Wright makes a really interesting point that I haven't seen elsewhere. (Maybe Diamond covers it in "Guns" but I haven't hit it yet.)

"When the Spaniards reached the American mainland in the early sixteenth century, the peoples of the western and eastern hemispheres had not met since their ancestors parted as Ice Age hunters running out of game. It is true that there had been a few pre-Columbian contacts - with Polynesians, Vikings, and possibly Asians - but these were too fleeting and too late to affect native flora and fauna or the rise of civilization. Not even such able seamen as the Norway rat and the cockroach had reached America before Columbus. Neither had the Old World's terrible plagues, such as smallpox.

What took place in the early 1500s was truly exceptional, something that had never happened before and never will again. Two cultural experiments, running in isolation for 15,000 years or more, at last came face to face. Amazingly, after all that time, each could recognize the other's institutions. When Cortes landed in Mexico he found roads, canals, cities, palaces, schools, law courts, markets, irrigation works, kings, priests, temples, peasants, artisans, armies, astronomers, merchants, sports, theatre, art, music, and books. High civilization, differing in detail but alike in essentials, had evolved independently on both sides of the earth."

His point is that human civilization tends to follow a fairly set script no matter where or when the civilization happens. His feeling is that humans almost always end up fouling our nest and having to collapse. He does refer to Tainter quite a bit.

IMO the complexity of modern societies makes them better able to cope with change than are simpler societies.

Absolutely!  And that's why we are so heavily invested in complexity.

Tainter's key point is that what you get out of complexity tends to decline with time.  ie. complexity in the past always eventually became a burden with there being no way to back away from it in a graceful fashion --- hence collapse.

Tainter makes the point that complex societies are very often able to overcome the effects of ecological degradation (among other threats) by increasing complexity.

Simple societies may wax and wane in tight correlation to certain environmental variables.  But complex societies don't.

In their case, if the added complexity continues to pay big dividends, things are stable.

Collapse comes when the citizens refuse to bear the burden of additional complexity because it yields little for them in return.

At that point, there is a decent chance of a sudden move to a simpler form of social organization.  That's collapse.  Note: a slow decline is not collapse.

At that point, there is a decent chance of a sudden move to a simpler form of social organization.  That's collapse.  Note: a slow decline is not collapse.

That's a good point. Few people seem to understand what Tainter means by collapse, even among those who have read the book.

The question Tainter addresses, is why does a complex society revert to a simpler type in the face of stress, instead of simply reducing the population but retaining its complexity?
Sure, a degraded environment always means you need to reduce population. But that does not explain why societies lose complexity. That is the unique approach Tainter has that no one else tries to address.

Tainter views organisation of societies as a problem solving mechanism. The problem that is being solved is how to turn non-human biomass into human biomass, i.e. exploiting the environment to increase the population. A complex society is more efficient at doing that, i.e. supporting more humans per hectare.

Obviously, a simpler society is less likely to hit an ecological limit than a complex one, because simpler ones have less people. In addition, at low population densities, simple societies have the ability to migrate, so they can simply avoid local environmental stress. A large agriculture based society does not have the ability to move, so is forced to weather it, or collapse. Additionally, there is unlikely to be unoccupied territory of sufficient size to move to.

Therefore complex societies are more likely to fall victim to environmental stress than simple ones, due to size of population and their fixed nature.

Tainter also notes that when a complex society collapses, the population falls well below a reasonable carrying capacity. e.g. still fertile farmland is abandoned, which is  not really explained simply by looking at ecological limits.

Either way, environmental stress does not explain why societies collapse in complexity, instead of smoothly adjust to a new limit, which is what Tainter addresses.

I just reviewed this thread. Your brief comment made sense the first time and your second post made your intent crystal clear. Thought I'd let you know a few can still read as well as bluster
Thanks, and season's greetings to you.
yes, well said.

The irony of the above thread is that Smekhovo's point about contemporary fears colouring interpretation in a very similar error to that commited by Darwinian - seeing the phrase "environmental determinism" and immediately associating it with attacks on Diamond.

I had a chuckle over this, very amusing indeed.

el paso announced that they had sold their anr pipeline for $ 4 billion     gee now they can pay down the debt to only $ 13 billion    this for a company with an $ 11 billion market cap        and in the last annual report for el paso   ceo foshee stated that el paso had "turned the corner"    what they have accomplished is to shed their income producing assets with hardly any reduction in debt       elwoods recommendation on ep     sell  mell  sell
This UN vote today on Iranian sanctions is making me queasy...
I am queasy too but for a different reason... I am getting the sense that Mr. Gates is about to return to us from Iraq and recommend the "surge" strategy.

It's heart-breaking. We are doubling down with our children's lives and money.

It would appear that the Iraq troop increase is in the bag, the Dems said yesterday that they'll go along with it, so that's that.  And my local news is talking about a draft.  Looks like "Last Man Standing" is the choice being made.
Bush needs to send his daughters too...what a mess
Well here's the thing...

I simply do not understand how adding 30,000 more soldiers and another 100 billion dollars keeps another martyr/insurgent/terrorist from choosing to die in a crowded market-place. And another after that... And another...

I see no end to it. Well, that's not exactly true. At some point we will have to face the facts... that voting for the Democrats changed nothing. The last time we faced suicide soldiers and ran out of civilized options, we dropped nuclear bombs... That's a depressing connection.

Losing isn't as simple as bringing the troops home. Losing in the Middle East is not the same as losing in Vietnam. It means the gas station goes away and cold houses. George Bush looks bad these days. He's got to explain this pretty soon. I hope he does it brilliantly because more palaver about democracy and terrorism won't work. He's going to have to talk about the oil. We can't tiptoe around it much longer

George Bush looks bad these days.

Depends... on whom he is working for : Is George Bush “The Manchurian Candidate?”

UN poised to pass Iran sanctions despite threat

· Ahmadinejad warns of immediate retaliation
· US and Britain step up naval presence in Gulf

Peak Oil for Christmas. And all I wanted was a lump of coal.


What is Iran doing that is illegal.  Where is the real evidence that they have a nuclear weapons program?  Sounds like we are going down the war road again, and is it a coincidence that we are now talking about expanding the army and marines.  This is about Iran, not Iraq.
They are sitting on OUR oil, that's what they're doing illegal.
Darn tooting, it's our oil.  And we might be getting ready to show them this fact.

US tests call-up system but denies return to conscription


The Soil Association, the UK's leading organic-farming charity, is devoting its annual conference in Januaary to the topic of peak oil and its future effects on farming. Colin Campbell, Richard Heinberg and others will be speakers.

See today's press release.

Fast-growing states: Arizona overtakes Nevada: Texas adds most people overall; Louisiana population declines nearly 5%.

The article includes a list of the fastest-growing states.  Rather scary, that already-crowded Hawaii is on it.

Leanan: The most surprising one is California. I can remember when that state's population was growing like crazy.
The article on the cod fishing problems is an excellent summary of why I remain very pessimistic about the human situation. Look at what is occurring. The cod are going extinct due to overfishing. A temporary ban on cod fishing followed by very strict fishing quotas is the only way to save the cod and the only way to save the fishing industry itself for the long term. Yet, because of short term pressure from that same fishing industry, the politicians cannot bring themselves to impose short term pain in favor of long term gain and thus, they ensure long term failure of the fishing industry itself. Even the fishermen cannot see past the ends of their noses.

This, in a nutshell, is exactly what I see happening with regards to energy flows and systems. We will take the short term "minimum pain" gain in exchange for the long term "maximum pain" losses. We do this over and over again when faced with difficult choices. As others have noted, we've evolved with these sorts of natural priorities and it takes deliberate effort to not let that sort of thinking dominate us.

Please don't preach to me about what technology can do. I already know what it can do. That's not the issue and never has been the issue. The issue is whether we will have the political will to do what is necessary to utilize the tech we have before our situation becomes dire. And my expectation there remains a resounding NO!

I'm a proponent of the "Abiotic Fish Theory", which contends that there is an unlimited undiscovered source of cod out there somewhere. Cast your net.
they mutated into asian carp and they are swimming up the illinois river to a lake near you        you dont even have to use a net the suckers (pun intended) will jump into your boat
Elwood is absolutely correct about the asian carp.

Here in the midwest most of the lakes,streams and rivers are polluted with asian carp. In many of the lakes it is difficult to fish and many have even given up trying.

The carp has destroyed a huge food source.

You put your boat in the water and start moving..the carp jump in fright,I suppose, and land right in your boat. I thought some were BSing me about this but when I asked I was told that fishermen just gave up on fishing. Not sure if Kentucky and Barkley lakes have been affected but I would suppose so.

Incredible but true. It appeared to begin back with the floods of 1993, I am told.

It just takes a simple google to find plenty of news about this.

We'll just clone cod, and grow giant blocks of fish through the miracle of modern technology.  The fishermen will get educated, become genetic engineers, and run the fish-cloning plants.

Until fish-cloning is outsourced to India, of course...

Ask and you shall receive.
Although I can not answer the question you pose (will we have the political will), I feel it is too important a question to not attempt anwering.

First of all, it is not obvious to me that we are capable of a tech solution, given the fact that fossil fuels have given rise to growth in the world's population that may not be sustainable. I think it is important to have a clear idea of the technical possibilities to have any hope of solving the political difficulties. If there were no such idea, then the politics would be even more intractable, and of a different nature.

But I agree that we, as a species, strongly tend to maximize short term gain at the expense of the future. And I agree that deliberate thinking to overcome that is necessary. And I would even agree with you that the odds are against us.

On the other hand, I am not omniscient, and there are probably factors which I do not know how to account for that may confound my expectations. One factor which is new, and perhaps hopeful, is that we now have means of instantaneous communication, and we have the ability to talk about our situation globally. Hopefully, that can guide us to the best outcome, whatever that is. And it is likely that this "best outcome" will not incorporate all of the cultural behavior which has gotten us to this point. This may be a chance to re-invent ouselves.

This may be impossible and my ideas nonsense, but I am sure of one thing. Having taken advantage in my lifetime of the energy abundance which is about to end, I feel a moral obligation to help today's children inherit a liveable world. Even if there is only a small chance of this, it is a chance worth acting on. And I agree with you that actions of a political nature will probably be the most important.

IMO ocean reserves are the only answer, and some propose them for the cod regions:


The cornucopian answer to declining fisheries is simply that we will farm raise the fish we need.

Of course they neglect a number of important things about farm raised fish. One is the ecological devastation caused by the creation of these fisheries, often including destruction of valuable mangrove coastal areas. Secondly is the fact that farm raised fish are dependent on one of two sources of food: farm raised grains for the vegetarian fish, with all the energy requirements embodied there; massive fishing for 'junk' fish to grind up and feed to the meat eating varieties (such as Salmon), thus depleting the ocean of even the next level down in the chain.

We need to figure out how to incorporate jellyfish into our diets, because that is all we may end up with.

Jellyfish is a delicacy in Asia.  

I've had it in Chinese restaurants.  The bell part is the part that's eaten.  It's sliced into thin strips, and tossed with sesame oil and rice wine vinegar dressing.  Doesn't have a lot of taste.  Like a lot of Chinese food, it's the texture that's important.  Kind of like chewing bubble wrap.  :-)

For a few months now I have been following something that was pointed out to me by Mike Bolser.

If you plot the closing prices of Brent Crude Oil (the front month contract), and you adjust those with the Major Currency Dollar Index (MCDI) as published by the FEDs on a daily basis, you obtain the value of Brent oil in currency weighted terms (i.e. in theory neutral as far as currency fluctuations go).

The historic Brent Closing prices are available on www.theice.com. The best value to use is the "evening one minute marker", but the quoted closing price will do as well.

The MCDI is available here: http://www.federalreserve.gov/Releases/H10/Summary/indexn96_b.txt

So far nothing special. But then, if you plot the 100 day moving average, something very strange emerges - the moving average runs in linear segments to a very close approximation. (currently trending down). This has been going on for many years. How can this be?

The MCDI is published every afternoon at 5pm EST. Brent closes at 12 noon EST. How is it that the relationship between these two is so predicatable?

I invite your comments. Anyone that wants a copy of my data is welcome to email me.

Brent Currency Adjusted 100 day Moving Average
A 100 day moving average of daily data of any sort tends to be a fairly flat curve.

For comparison, here's a 100 MA plot of USO.


I'm not sure what your point it.

I agree with you - I follow 100 day MA curves all the time. This one is not just "fairly flat". It is linear between defined points that runs for weeks. On the sample I show, there is an inflection point at Nov 22nd that you may be able to make out. Prior to that, the MA is flat between Aug 15th and Nov 22nd with a regession index better than .99 - it does not get much flatter than that.

If you plot the 100 day MA of just Brent, then you get what you pointed out - a "fairly" flat curve. It is only when you adjust it with th MCDI that if GOES TOTALLY LINEAR.

Just to follow up, for the adjusted 100-day MA to be this linear, over a period of 70 trading days, at a time when Brent oil fell from $73 a barrel to $60, and the dollar gyrated significantly as well, is truly very peculiar.

Look a little closer.

I don't know what's happening with R2's highly commendable attempt to make TOD a betting site (pays better than a bunch of Google ads), but I'd like to add a prediction here. Can't really see how to make it a bet, the timeframe is a bit long.

The prediction is that both the ethanol and the carbon offsets scams, oh, OK, schemes, will rake in over a trillion dollars globally, prior to the public waking up to the fact that they are being plundered by people who play on their susceptibilty to plans that promise to cleanse their bad conscience.
The triumphant return of absolution.

This wake-up will happen in 2010, by which time it'll be too late to reverse our steps, since there'll be so much less money available around the world, that there will be no way to offset the damage done by the offsets. It's a one time last chance, and it's being wasted so thorughly it's hard not to laugh.

We face huge and urgent problems in both energy supplies and in the environment, and we display an astonishing knack for choosing the by far worst solutions, a development largely driven by the fact that there is gold in them thar hills. Not only corporations and governments are after the loot, many environmental groups are getting real comfortable selling offsets. And that last bit is at the very least 'open to debate", since the real value to the environment from these trades is, well, debatable. Green groups with corporate structures, that's just what we needed.

As for the ethanol, that should be abundantly clear by now. Canada just announced it's joining the fray, like the US will join the carbon trade as soon as the big boys figure out how to make us believe we should pay them "a little extra on the side" to make it all better. Can't hardly wait.

Carbon offsets, still largely unfamiliar here in North America, are explained by the New York Times today:

(I'll admit I am cynical about much of this, but even I wasn't prepared for these numbers. You're a good grifter in my book if you make people pay double what something is worth, but a hundred times more? Brilliant!!!)

Outsize Profits, and Questions, in Effort to Cut Warming Gases

Under the program, businesses in wealthier nations of Europe and in Japan help pay to reduce pollution in poorer ones as a way of staying within government limits for emitting climate-changing gases like carbon dioxide, as part of the Kyoto Protocol.

Among their targets is a large rusting chemical factory here in southeastern China. Its emissions of just one waste gas contribute as much to global warming each year as the emissions from a million American cars, each driven 12,000 miles.

Cleaning up this factory will require an incinerator that costs $5 million -- far less than the cost of cleaning up so many cars, or other sources of pollution in Europe and Japan.

Yet the foreign companies will pay roughly $500 million for the incinerator -- 100 times what it cost. The high price is set in a European-based market in carbon dioxide emissions. Because the waste gas has a far more powerful effect on global warming than carbon dioxide emissions, the foreign businesses must pay a premium far beyond the cost of the actual cleanup.

The huge profits from that will be divided by the chemical factory's owners, a Chinese government energy fund, and the consultants and bankers who put together the deal from a mansion in the wealthy Mayfair district of London.


..... a study commissioned by the world organization has found that the profits are enormous in destroying trifluoromethane, or HFC-23, a very potent greenhouse gas that is produced at the factory here and several dozen other plants in developing countries. The study calculated that industrial nations could pay $800 million a year to buy credits, even though the cost of building and operating incinerators will be only $31 million a year.

The situation has set in motion a diplomatic struggle pitting China, the biggest beneficiary from payments, against advanced industrial nations, particularly in Europe. At a global climate conference in Nairobi, Kenya, in November, European delegates suggested that in the case of Freon factories now under construction in developing countries, any payments for the incineration of the waste gas should go only into an international fund to help factories retool for the production of more modern refrigerants that do not deplete the ozone layer.

But the Chinese government blocked the initiative, insisting that money for Chinese factories go into the government's own clean energy fund.

Ahem. And what about the rest of the boondoggles? I predict PV and wind will pop just a tad later - of course after we spend a copious amount of taxpayer money to enrich certain individuals. But what do I know.
obviously enough. :)

Makes you mad in a depressing sort of way.  My guess is we will do a collective "Thelma and Loiuse"....

And where shall we escape to? Not that much places to get away from ourselves and from what we've done.
Er...Thelma and Louise didn't escape.  They drove off a cliff with the pedal to the metal.
They landed in Kansas.

Just wait for the sequel, you'll see.

According to this widely published article:

Oil prices fell on Thursday, wiping out the previous day's gains, as traders dismissed a big fall in U.S. crude stocks as the result of shipping disruptions caused by fog, rather than a lasting reduction.

I wander how feasible this is? Could 6.3 mln.brl. reduction be a result of shipping delays? 6.3 mln. is about 7% of the US weekly imports - this sounds too much, but I can't not sure without an expert opinion. I guess we'll have to wait for the next week to find out.

The EIA was quoted in Platts Oilgram News yesterday as stating the fog caused crude imports of 1.7 million to be delayed (not 5 or 6 million as hyped by the media).

The Houston Pilots Association said on Thursday it had nearly cleared a backlog of ships waiting to enter the Houston Ship Channel. So whatever effect fog had last week, will be reversed this week.

Blaming the downfall of oil/product inventories on such things as fog, etc., has tended to hide the fact that total US inventories have now dropped almost 60 million barrels from their peak.

With further cutbacks in exports by SA starting January 1, 2007, I expect that downtrend to mostly continue intact.

Yeap - and total inventroies (which I prefer to follow to possibly identify a long term trend) are down near 8mln.brls... I would not be surpised though if crude oil inventories are up next week by whatever amount (1-2mln.brls) the prices to drop down further. Even though the combined 2 week draw would be 4 mln.brls. I think the market is in a self-sustained bearish mood right now. Let's see for how long.
U.S. Stocks Decline as Gauge of Factory Demand Trails Forecast


Dec. 22 (Bloomberg) -- U.S. stocks fell, sending the Standard & Poor's 500 Index toward its worst week in two months, as a decline in a measure of factory demand added to concern that economic growth will weaken.

Alcoa Inc., the world's biggest aluminum producer, led raw materials stocks lower for a second day on speculation slower growth will hurt demand. Qualcomm Inc., the second-largest maker of mobile-phone chips, slid after cutting its profit forecast.

Excluding transportation equipment, orders for durable goods fell 1.1 percent in November, the Commerce Department said. The retreat follows a 1.6 percent decline in October.

``It shows mainstream industrial America, which has been humming along at a good clip, is finally starting to slow down,'' said Dan Bandi, who oversees $2.5 billion as chief investment officer at Integrity Asset Management in Independence, Ohio. ``That might be upsetting some people.''


Hey...everything's OK because we (the US) have SERVICE jobs out the whaaazooo....we really don't need those dirty, good-paying factory jobs, do we?  I would MUCH rather work at a nice, clean McDonalds for minimum wage!!  There is NOTHING wrong with our economy.  Whoa...I think I got possessed by the ghost of BushCo.


Merry Christmas to all those that have been "down-graded" in their jobs, lost their jobs to take worse jobs, started a second job to pay bills, received lesser bonuses or gifts from their managers this year, worked longer hours just to keep up, paid more for their fuel to get to their jobs, lived through ANOTHER business reorganization/transformation process, will spend their Xmas in barracks around Baghdad wondering when they will get to see their kids and why they are there, waiting in line for a Xmas meal at the local shelter and wondering why the line is longer and there is less food than last year, those in New Orleans trying to rebuild there lives WITHOUT the help of the government that PROMISED to help them, those stranded in the Denver and Heathrow airport wondering where this freaky weather came from and why it had to happen now, and FINALLY....

Merry Christmas to all the millionaires and billionaires that DO NOT try to make the world a better place and build a better future that includes more than their own personal bank accounts....I pray that you are visited by the ghosts of past workers and individuals you have tread upon to get where you are at...and that when awaken from that midnight dream...you are enlightened...that you see the world in 2007 as it truly is...and that you take action to change the paradigms/dogmas/beliefs that will hinder the future of the world.

Or perhaps, it was all a dream, nothing to worry about, no one but you saw the ghosts of past, present, and future.....

"Every weekday morning, government analysts gather inside the headquarters of the Federal Energy Regulatory Commission to scour the nation's energy markets for fraud."

After Enron...

Norway is not in OPEC, but presumably the Norwegians don't want to be the only fools extracting their oil as fast as possible when they know that peak oil is around the corner...

Norway's Statoil trims oil production

Norway's state-controlled oil company Statoil ASA on Friday said it was cutting production at its Kvitebjoern field by the equivalent of 95,000 barrels of oil per day for the next five months as part of a reservoir management and drilling program.
I don't think extracting oil ASAP is out of foolishness (OK, at least to a certain extent). Most of it it is the only reasonable choice from oil producer's point of view, especially in countries heavily dependent on oil revenues. Richer and low-population countries like Norway or Kuwait can afford some more freedom, but I don't think this would be the case for Iran or Russia.
The Royal Bank of Scotland have published (pdf) UK oil and gas production statistics for October (the official statistics will probably be published next week).

They show that despite a 10% in oil production over September (normal recovery from summer lows), October oil production was still 12% lower than in October 2005.

Natural gas production was 5% lower than in September and was an amazing 24% lower than in October 2005. I suppose this is the much talked about natural gas 'cliff'.

The North Sea, like the Lower 48, started declining after crossing the 50% of Qt mark (crude + condensate).  

The World, like the North Sea and the Lower 48, started declining after crossing the 50% of Qt mark (crude + condensate).

The Lower 48 and the North Sea were once where the world is now.  Soon, the world will be where the North Sea and the Lower 48 are now (at least for conventional oil).


EU Oil and Energy Production Plummets
Thursday, December 21, 2006

Last year was disastrous for energy production within the EU, especially Britain. Massive energy production declines in Britain are aggravating the EU's external energy dependence. Consequently, Europe is becoming increasingly dependent on foreign energy suppliers.

The European Union was forced to import a record amount of energy last year, as output in every major production category including oil, natural gas, coal and nuclear power fell. Although overall EU energy demand remained flat, total energy production from all sources cascaded 4.2 percent compared to 2004.

The largest energy sector drop was in crude oil production: This fell by 9 percent, primarily due to Britain's aging North Sea oil fields, which experts say are beginning to run dry.

Natural gas production slipped by 5.8 percent, also largely because of production declines from Britain's North Sea, as well as declines in Dutch fields, which fell 7.7 percent and 5.9 percent respectively.

Coal output within the EU dropped by 5.7 percent, again in large part due to significant declines in Britain, the EU's third-largest coal-mining nation. However, Poland and Germany, the EU's first- and second-largest producers, also experienced coal output reductions.

Surprisingly, even with the upsurge in nuclear power generation interest that has swept the globe in recent years, nuclear power production still declined by 1.3 percent across the EU. Germany, the EU's second-largest atomic power generator, cut output by 3 percent, overwhelming the slight increase in French output.

The EU now imports 56 percent of its energy needs--an amount that is increasing. In 1995 this figure was only 44 percent. If trends continue, by 2020, the EU will need to import two thirds of its energy demand according to the European Commission report "European Union Energy Outlook to 2020."

Germany, Italy and France already import 90, 91 and 95 percent of their daily oil needs respectively, and the vast majority of their natural gas needs. These nations typify the foreign energy dependence which almost all EU nations experience.

As European dependence on foreign energy increases, Europe will become increasingly vulnerable to energy shocks. Watch for the push for greater European energy security to continue to be led by Germany, Italy and France as they seek to gain control of foreign energy supplies.

Global competition for energy is about to heat up.

Given the source of this article (a religious organization), it would seem possible that you are a follower of Herbert W. Armstrong.

The source of the article, "The Trumpet", is an organ of The Philadelpia Church of God.

From their site:

Trumpet uses a single overarching criterion that sets it apart from other news sources and keeps it focused like a laser beam on what truly is--even in an absolute sense--important.That criterion is prophetic significance. The Trumpet seeks to show how current events are fulfilling the biblically prophesied description of the prevailing state of affairs just before the Second Coming of Jesus Christ.

The Trumpet has a long history of accurate forecasting of major global events based on this predictive model....


What do they believe about the "end times"?

What does Westexas believe about the "end times"?  Is bible prophecy part of your predictive model?

So anyone who links to an article in the Washington Times is a Moonie?
Unlike "The Trumpet", the Washington Times is not the official organ of a religious organization and a publication that states its raison d'etre as to show "how current events are fulfilling the biblically prophesied description of the prevailing state of affairs just before the Second Coming of Jesus Christ."

However, the ties the Times has to the Unification Church definitely count against it, in my view.

What does Westexas believe about the "end times"?  Is bible prophecy part of your predictive model?

Absolutely.  I consider the fact that Britney Spears has 25 million Google listings that absolute evidence that the end times are near.

Oops, perhaps the end times are not close after all.  It looks like Britney's listings are down to 17 million.  
BTW, now that we have established that I am a End Timer, who worships Britney Spears as a sign of the Apocalypse, what about the substance of the article, which came from Sprott Asset Management's website?  Are any of the numbers wrong?
I meant to say '...despite a 10% increase in oil production...'
today's release by iea shows proof of collapsing global inventories: http://www.trendlines.ca/economic.htm#misc
What does this mean?

Anything more exciting that OPEC cutting production and people taking oil out of stock instead?

Almost all scheduled Nov 1st opec cuts are in play. Balance start Feb 1st. There will be a recalculation upon new member angola's supply stats for March. Similar quota recalc's will be necessary for entry of sudan & ecuador later in year if member status approved as well (formalization was incomplete for Dec 14 mtg). IEA also reports Mexico & Russia supply up 40-kbd in November. SA is down 160-kbd to their previously announced sustained supply rate of 8.6-mbd. SA has formally requested that other OPEC members share the spare capacity needs of being swing producers as it feels the costs of latent capacity should not be borne solely by itself. Present OPEC spare capacity is 3.81-mbd. Supply surplus of Q2/Q3 is downward revised to 1.75-mbd from 1.85-mbd.
If the 8.6 mbpd production rate for Saudi Arabia is correct, it is one mbpd below their 2005 peak production rate.  

Saudi Arabia in 2006 is at the same point of depletion that Texas also started "voluntarily" cutting production (in 1973).  

I predict that Saudi Arabia's "voluntary" reductions in production will average about 4% per year going forward.  

Texas has now voluntarily reduced its production to about 27% of its 1972 production level, because of a persistent inability to find buyers for all of our oil, even our "light, sweet oil."  

With announced and upcoming cuts in play, nobody will be in a position to counter your positon for almost a year. Have fun with your forecast. In the meantime, some weekend reading on Spare Capacity by Dr Fattouh of the Oxford Institute for Energy Studies: http://www.oxfordenergy.org/presentations/spare_capacity.pdf

I'm agreeing with you.  The "voluntary" production cuts by Saudi Arabia are every bit as plausible as the ongoing "voluntary" production cuts that Texas has made.  But rest assured, when market conditions dictate, Saudi Arabia and Texas can and will increase their production.  In the mean time, I urge everyone to buy large SUV's.  I need to pay for another European vacation.

buy BIG suv's  and drive like a maniac up and down the road to your suburban wastelands  in a rat race to nowhere      
best wishes for a happy whatever (christmas, chanuka, quanza, ramidan or winter solstice)
(christmas, chanuka, quanza, ramidan or winter solstice)

Right, you must care for political correctness and beware of legal consequences:

From the wisher (me) to the wishee (you) please accept without obligation implied or implicit my best wishes for an environmentally conscious, socially responsible, politically correct low stress, non-addictive gender neutral celebration of the winter solstice holiday practiced within the most enjoyable traditions of the religious persuasion of your choice or secular practices of your choice with respect for the religious and or secular persuasions and or traditions of others or their choice not to practice religious or secular traditions at all.

I wish you a financially successful personally fulfilling and medically uncomplicated recognition of the onset of the generally accepted calendar year of 2007 but with due respect for the calendars of choice of other cultures or sects having regard to the race creed colour age physical ability religious faith choice of computer platform or sexual preference of the wishee.

By accepting this greeting you are bound by these terms:
This greeting is subject to further clarification or withdrawal.
This greeting is freely transferable provided that no alteration shall be made to the original greeting and that the propriety rights of the wisher are acknowledged.
This greeting implies no promise by the wisher to actually implement any of the wishes.
This greeting is warranted to perform as reasonably as may be expected within the usual application of good tidings, for a period of one year or until the issuance of a subsequent holiday greeting, whichever comes first.
The wisher warrants this greeting only for the limited replacement of this wish or issuance of a new wish at the sole discretion of the wisher.
Any reference in this greeting to "the Lord", "Our Saviour", "Rudolph theRed Nosed Reindeer," "Aliens" or any other festive figures whether actual or fictitious, dead or alive shall not imply any endorsement by or from them in respect of this greeting and all propriety rights in any referenced third party names and images are hereby acknowledged.
Have a great holiday. Whatever Christmas means to you.I hope you and those dear to you have an enjoyable time.

NB: No Liable party is identified nor confirmed. Without Recourse.

Yes there is a counter. if prices were to increase to $80 in March and no corresponding increase in SA production there would be a fishie smell coming out of the Arabian desert.
to add to the 'rattie smell'?
IEA also reports Mexico & Russia supply up 40-kbd in November

Freddy, the IEA is notorious for being wrong. Mexico is notorious for being honest with their reporting of proven reserves and production numbers. Mexico reports 10,000 barrels per day down in November, C+C, following an 85,000 bp/d drop in October. All Liquids were down a whole lot more.

I have no idea what Russia did in November, but if the IEA are as wrong about Russia as they are about Mexico, they were probably down also.

Ron Patterson

Ron, i know u and a few of the other posters at tod would like to think EIA is the center of the universe, but unfortunately their reputation precedes them.  IEA has been vocal wrt to the faults of domestic reporting of several nations.  No adjustments for volume to temp, standardized barrel size, desired monthly cycles etc.  The worst has been venezuela.

After 36 months of eating crow every "next" month i thot that u would have learned to stop eating crow by now...

IEA has reported that by its definitions, Mexico dropped 110-kbd in October and was up 40-kbd in Nov.  Believe what u will... but after being wrong 36 months, what's another, eh?

Your monthly challenges are childish, Ron.  IEA does a monthly preliminary and follows up with two revisions.  I have stated this several times.  Your allegation that any of their numbers has been proven wrong time and again.  And that's why i rarely use your late american stats.  Stuart and Khebab have both done analysis on the EIA/IEA variances.  It doesn't matter the metrics are equivalent, only that they are consistent for comparison purposes.

Please Ron, grow up...

After 36 months of eating crow every "next" month i thot that u would have learned to stop eating crow by now...

Freddy, what the hell are you talking about. When have I had tp eat crow because a prediction of mine has been wrong? Hell, I seldom make predictions and if I do I acknowledge that they are only guesses. You, on the other hand, always give a "heads up" and make an unqualified prediction, which seldom, if ever is correct.

What I have stated is that we are at the peak right now and that December 2005 is very likely to be the peak month. And I have not had to eat crow on that one.

IEA has reported that by its definitions, Mexico dropped 110-kbd in October and was up 40-kbd in Nov.  Believe what u will... but after being wrong 36 months, what's another, eh?

Freddy, the EIA always uses the figures for Mexico provided by Mexico. You can check it out, the figures reported by the EIA in their International Petroleum Monthly are always the exact numbers found here for "Total Crude" Supplied by Pemex.

However I have no doubt that the IEA supplied the numbers you posted. As screwed up as they are, what else can one expect?

I do not claim to be infallable Freddy. My guesses are only guesses. But I will put my record up against yours any day of the week. I have been right far more times than you. And this 36 month thing of yours is pure bullshit! And I am holding your prediction of 4 million barrels per day by Pemex in the first quarter of 2007 in order to see you eat crow. I am predicting that it ain't gonna happen and if I am wrong I will gladly eat crow. How about you if it does not happen?

Ron Patterson

A bit spent on Fraudy Nutter is a bit wasted.
>A bit spent on Fraudy Nutter is a bit wasted.

I second the motion. No need to waste your valuable time trying to nail jello to the wall.


The charts you posted look like they only go to the end of September?
Just thought I'd mention something about holiday travel.  I wanted to travel a good part of the way across NY (state) to visit relatives over the next week, so I thought I'd look into taking the bus.  Why not try to take advantage of mass transit, save the aggravation of driving, and try to keep some mileage off my car, right ?.  Well, I'm finding that working through the bus schedules is probably even more annoying than driving...

It has really made me appreciate just how much work we have ahead of us for mass transit to really be accepted here.  It may work great on a local level but travel on the scale I'm trying to do (~ 250 miles) looks like it will require some serious work to make it viable.  All I've been trying to do is go between a couple small to mid-size cities and the bus lines all turn what should be about a 5 hr trip into as much as a 14 hr ordeal with layovers etc.

How about the train?  

Though Amtrak is often more expensive than flying...

I also looked into travel by bus and train. My three hour drive becomes at least seven hours on Amtrak or Greyhound, and far more costly.
When I set off from Beijing for western China I picked up a copy of the train schedule booklet.  The size of an average Harlequin Romance, it contains the entire schedule for the massive train system in China. Not bad.

As I sat on a curb trying to decipher what turned out to be a very easy to read (assuming some basic ability in Chinese) book, a local sat down next to me and began to assist me, hoping I'm sure to be rewarded with a tip.  Sadly, the police hauled him away in the middle of our deliberations because he had the wrong badge.  I felt terrible for the poor guy and I never did find out what the right badge was, but I suspect he wasn't authorized to help westerners.

I did figure out the schedule though.  Amazingly well organized booklet for such a complex system of trains.

Interesting article about Chavez's pipeline plans in SA:http://www.financialsense.com/editorials/kwr/2006/1221.html
I have been scanning the recent threads today. Maybe a bit late, but...
About the `aviation and oil depletion' thread:
I think Captain C. Smith failed to mention one potentially conceivable alternative to liquid fuel - small nuclear reactor.
In the 50 and early 60 there were military researches in this direction - about potential long range heavy bomber. But the technology was nascent, reactors were too big and insulation from radiation was too heavy. In the time conventional liquid fuels won.
But research never stops. Today once again there is movement in military to develop nuclear powered plane. There are even predictions that with sufficient finances such a plane will be ready in 10-15 years in Russia. I don't know whether these are real plans or just extortion of money by the military labs. As well as I don't know whether such a plane will be suitable for commercial use.
Maybe this is just another technophile fantasy, but who knows...
And I'm sure any such a project will be immediately dubbed as `flying Chernobyl'.
Ok, just let's make sure we keep the reinforced Cockpit doors on those things, alright?

Kidding, kidding!  Wait, no I'm not!

Ghost of Christmases yet to come..

If they are anything like the reactor used in the NB-36 experiment then the similarity to Chernobyl is even more evident.  Horizontal vs verticle control rods that are used in western reactors.
Very large nuke powered hot air blimps might be a winner.  It could be a way to connect landlocked areas of Asia and Africa with world markets.
Fodder for tomorrow, perhaps:

Peak Oil Passnotes: Peak Oil vs. Cera - The Fight Continues
Chris Skrebowski from the Energy Institute in London has written an open letter to CERA wondering about many of the same questions. Skrebowski is in fact a regular `peak oil' chap. He is not given to wild pronouncements and is currently editor of the industry magazine Petroleum Review. This makes what he has to say a lot more interesting.