DrumBeat: July 14, 2006

[Update by Leanan on 07/14/06 at 9:32 AM EDT]

Oil prices strike record high above $78 per barrel

"We are certainly in uncharted territory," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. "I wouldn't be surprised if $80 is attained soon with this slew of geopolitical events in a tight market."

..."We haven't even taken into account a potential hurricane in the United States, so getting to $80 and beyond this summer seems quite inevitable," Shum said. "But if these Middle East events somehow get resolved, prices could also drop sharply."

Can't make the trip to Italy for ASPO-5? Check out the ASPO-5 Live Blog.

See the new and improved version of Westexas' article about Daniel Yergin Day at Energy Bulletin.

An Early Retirement For The Hydrogen Fuel Cell:

At last weekends Lucerne Fuel Cell Conference, which is a highly respected technical conference, Ulf Bossel, the organizer, made a pretty signinficant announcement: the European PEMFC Forum series will not be continued because hydrogen fuel will never contribute to a sustainable world. Instead they will focus on phosphoric acid fuel cells, molten carbonate fuel cells and solid oxide fuel cells which "can meet the challenges of a sustainable future".

Supermarkets and Service Stations Now Competing for Grain, according to Lester Brown.

China to allow foreign exploration in key oil, gas blocks:

China has traditionally limited foreign access to its onshore oil and gas resources but as demand for energy to power its booming economy has grown, it has opened the door and in March Petrochina signed a deal with Total of France on exploration in the Erdos Basin.
Will new pipeline ease the West's energy woes?
The 1,094-mile Caspian oil duct, inaugurated Thursday in Turkey, may not be as tangle-free as America had hoped.

..."Increasingly, Russia is dictating its terms," says Necdet Pamir, an energy expert with the Eurasia Strategic Research Center in Ankara.

A Russian monster arrives, and its name is Rosneft.

Pentagon and Peak Oil: A Military Literature Review

Uganda: Power Outages Fueling City Fires

President Clinton says he was never briefed on peak oil.

Santa Barbara Prepares for Peak Oil

Dreamliners and Peak Oil - designing airplanes for energy efficiency.

Peak Oil and Energy Resources - a ten-minute intro to peak oil.

3 ways to win from the oil glut:

Believe it or not, there's an excess of oil -- but it's an excess of hard-to-refine heavy sour crude.
How fungible will net oil exports be in a post-Peak Oil environment?

Following is a post I made yesterday.  I am  beginning to wonder if oil exporters are going to increasingly turn away from the US market in favor of exporting their oil to importers that have better quality and/or lower cost goods and services to offer in exchange for oil.    


Venezuela's Oil Sales to U.S. Drop as Chavez Sends More to Asia

The Venezuela story is (mostly) not related to my Export Land model, but there are three points:

(1) It does raise the question of whether oil, in a declining net export capacity environment, is truly fungible;  

(2)  Note that Chavez is transporting his oil seven times farther than the distance to the US Gulf Coast.  This effectively reduces net export capacity because of the greater amount of oil locked up in transit;

(3)  Combined with gas station story, it makes one wonder if Chavez is gradually withdrawing from the US market.  Given China's low cost manufacturing capability, if I were Chavez I would prefer to trade with China, versus the US, even with the higher transportation cost.

How fungible will net oil exports be ...?

Good question. I've asked TOD before how much oil is traded on the spot market (as opposed to fixed price long term contract) but no-one seems to know. Chavez also has his Petro-Caribe initiative which offers oil to Caribbean nations at less than (market) cost. I think you're right, this trend will accelerate.

I am beginning to think that the contraction of the discretionary (majority) side of the US economy is going to happen far faster than I initially thought--it's beginning to happen right now.  Note that the home foreclosure rate in North Texas is already up 26% year over year.

My continuing advice: ELP (Economize; Localize; Produce).

I very strongly suggest that you get yourself on the nondiscretionary side of the US economy ASAP.

That's what I call the Peak Oil "Duck and Cover" procedure.  Westexas' ELP guidelines are this generations equivalent to the Cold War's "Duck and Cover" drills.

The difference is of course that Westexas' advice will actually help you.

For "production" I suggest
  1. a 19th century style trading post
  2. an 18th century style tavern

These are what I have, up and running--and even legal!
You need to advertise on TOD.
Thank you.

From friends and family, I already have plenty of customers.

My most lucrative business is consulting about survival supplies.

e.g., I can provide a $100 package for college students, a $1,000 package for young couples and all the way up to the "Fortress Package" at $300,000.

whats in each of those packages?
I customize each package based on:
  1. What a person already has and knows.
  2. What is most needed.
  3. What will be of value no matter what happens.

I offer money-back guarantees.

Since 1962, nobody has ever asked for their money back. Also during and before, nobody has asked.

I do it because I like people, and I make no money at it that I do not give to the Nature Conservancy.

Who was it who said: "Allhands buid boats!"?

The only boat builder in history who finished on time.

Amazing what sufficient motivation can do, eh?
Andrew Jackson Higgins finished ahead of time in New Orleans, and won WW II ias a consequence.  City streets were converted into factory expansions, street lights were retimed to spped deliveries to the various shipyards in New Orleans

A major reason that the offical US WW II museum is a mile from my home on Andrew J. Higgins Blvd..

Andrew Jackson Higgins finished ahead of time in New Orleans, and won WW II is a consequence.  City streets were converted into factory expansions, street lights were retimed to speed deliveries to the various shipyards in New Orleans.

To insure adequate materials in case of war, he bought the entire 1941 Phillipines mahogany harvest.  All of which ended up on various invasion beaches.

A major reason that the offical US WW II museum is a mile from my home on Andrew J. Higgins Blvd..

I LOVE Higgins boats!
Something's gotta be done

This was a quote, by a disgruntled grocery shopper, shown on CNBC this morning.   She said that if you go into a Safeway with a $100 bill, you come out with $20 worth of groceries.  She then said that "Something's gotta be done."  

We will see similar interviews with consumers in front of gas pumps--"Something's gotta be done."

The epic paradigm shift that we are witnessing is American consumers' very gradually dawning realization that the days of cheap food and energy are fading away.  They are not going to be happy campers, and they are going to demand that politicians do something to bring back cheap food and cheap gasoline.   I suppose that a first step would be for Congress to repeal the Laws of Thermodynamics.

Probably something like they're doing in New Brunswick:  price controls.
Yup. And then (as implied by the article) if the controls actually bite, they will get shortages and lines (as we got in the 1970s). Then, I suppose, they can haul Hugo Chavez into court for "hoarding", and try to enforce a judgement to that effect. Oh, what fun.
'seems to me that the highly processed (convenince) foods are climbing most rapidly, and that if you cook basic items there is less of an impact.

I guess I'm suggesting "eating lower on the food chain" in two senses of the phrase.

Could it be that the record production of ethanol is starting to have an effect?  Corn based,i.e., heavily processed foods would be the first affected. Corn is in just about everything processed, including meat.  We've had a cheap food policy for years through our subsidy policy, but with the ramp up of ethanol, this will probably end.


Meat is cheap now and getting cheaper due to drought in some areas.
I'd like to see some data on it.  I'm betting its transportation and other petroleum costs creeping in.
Buy a Sunday newspaper.

Shop the specials.

That is what I do.

Meat is cheap and getting cheaper.

I agree and my great fear is that what some (and especially those in power) will demand is that "doing something about it . . ." means going to war for the remaining oil rather than actually doing something about the way we live. I see a situation unfolding over the coming months and years where a large segment of the American population is convinced that the countries with the oil are "holding out on us" or "using oil as a weapon."  Remember, as Bush told us, the American way of life is not negotiable.
I think you've got it.  You aren't "doing something", at least not seriously, unless the military is involved.
Hello Twilight,

Speaking of military involvement, how about a US naval ship docked in the Black Sea port of Feodosia setting off demonstrations, then riots, then a blockade with anti-NATO Russian seperatists discovering onshore US weaponry [if purportedly to be used in upcoming seaborne exercises--why unload it offshore]?


Does anyone think the G8 does not have a lot to discuss?

Bob Shaw in Phx,AZ  Are Humans Smarter than Yeast?

I know what you mean.  This whole Israel/Lebanon thing is beginning to taste like a pretext for an oil war in Iran.  If we can't invade over WMD we use our surrogate.
Sure thing. Something's got to be done.

  1. cancel Star Wars anti-missile systems
  2. don't build the next generation Raptor airplanes.
  3. close most of the 700 offshore military bases
  4. quit pushing corporate globalization agendas
  5. quit pulling our winkies over gay marriage and abortion rights and immigration
  6. quit listening to lobbyists from K street and listen to constituents
  7. quit subsidizing corn
  8. etc... etc... etc...

Sometimes I feel like Herbert Hoover is in office and we are waiting for the "market" to make things right.

Not going to happen.

I think what we'll see politically are two things:

  1. A return to classic 'class warfare' economic politics by the left.

  2. An ever more strident effort by the right to focus on 'cultural' issues to fob off growing economic discontent.

This means in the US:

A. Further political polarization.

B. Purge of moderates from both US political parties.

C. Increasing institutional dysfunction and gridlock.

D. Increasing search for 'extra-constitutional' solutions by whichever party controls the Presidency.

In the formerly 'hot' real estate markets, such as here in Florida, the foreclosure statistics are even worse:


"In Broward County [Ft. Lauderdale area], foreclosures were up in the first quarter over the end of last year by 57 percent. In Palm Beach, they jumped 69 percent, and in Miami-Dade, they were up 17 percent.

Overall, South Florida had about 3,000 more foreclosures than at the end of 2005 -- a jump of 40 percent."

The ARMs with no money down are coming home to roost.

  1. I wonder if China, that apparently had trouble with heavy sour Saudi crude, could handle heavy sour Venezolan crude?

  2. The export capacity does not diminish because of oil locked up, since once the switch is made, the deliveries will be as regular as they were. However, this locks up more oil transport capacity and that has the same effect. Plus the fuel burned underway also costs something.
They hydrogen thing seems to be a good sign that those folks are "getting real" and not just supporting a hydrogen lobby.  Maybe I shouldn't count these political chickens before they're hatched ... but with MSM pushback on ethanol EROEI and corn subsidies, there seems to be more practical thinking than there was a year ago.
Reality may be a two edged sword. Two of Bush's greatest achievements, in his befuddled brain, are hydrogen and ethanol. He said something to the effect that people will look back in the future and see his initiatives as the turning point in the fight against global warming.

When reality sets in, people in the camp that magic will fix everything, may wake up and say to themselves,"what the f**k?, there no wizard behind the curtain, after all".  And when people realize that the SRIHTF, what will they do?  In the short run, we will see an even greater effort to make sure we are drilling everywhere all the time.  

All things considered, however, I've gotta go with reality.  Reality tends to make you invest in things that actually have some hope of doing something useful.  It's good to see that someone finally had the courage to stand up and point out that the hydrogen emperor, "our hope for the future", has no clothes.

Well, we've got all those day traders thowing money at every alt-energy company with a glimmer of a chance.  Whatever other flaws we have (and there are many) we are at least funding research.

... I do wish conservation and efficiency had as strong a value network.

I never thought that Bush and the corporate powers behind him ever considered hydrogen seriously even for a minute.

This was all a little expensive PR event, in order when the shortages come by they could say: "Gosh, we tried so hard to get something clean but it didn't work. Unfortunately we will need to go fo CTL, tar sands, heavy oil and nuclear now... Oh, yes we will also need to wage 1-2-3 more wars to secure "our" oil...". I see ethanol as the next excuse in the transitioning campaign to more and more dirtier and/or controversal energy sources and measures to preserve our "non-negotiatable" way of life.

Right, but my point is that the dream/PR-effort crashed early.  They had to move on to the ethanol dream/PR-effort, and that is already under assault (not just from us, but from the WSJ, etc.)
Yes, I also share your optimism. The old rule that in order to get the attention or change the mind of Joe Average you have to make him reach deeper in his pocket worked even better than expected.
This should be "nice" of course... my personal spell-checker is out of order, I guess.
The whole hydrogen/ethanol boondoggle reminds of the old "star wars" effort under Reagan.

One of the scientist told a senator that it was ridiculous to build a enormous laser prior to getting the table top prototype  working.  The senator accused him of being disloyal to the president and tried to get him fired.

When dealing with politicians it is important to realize that they don't understand technology.  To them (and most of the public) it IS magic.  An those 'liberal arrogant scientists" are just trying to be difficult.

It's amazing what the govt. spin doctors can do. The propaganda machine, unfortunately, works pretty well. I predict that at some point the Bushies will say that Larry Linney was fired for underestimating the expense of the Iraq war :-()
Thank a deity for living in a country where politicians fairly often listen to scientific reasoning. The rot is mostly in social sciences where the real world can be ignored.
Alas. Speaking as an economist and sociologist, I must agree.

Oy, veh.

The problem is too many factors, or impossible ones  to measure; so intuitive knowledge(or more likely the lack of) -with it's myriad of perspectives gets studies projected in journals to scientifically prove(?)- well the subjective point of view. Ain't sciences; but dammed important!That is why we need this dialogue.
BTW this community  seems to be moving beyond 'bargaining'.
Agreed. The measurement problem is the real kicker. There's progress, but it's much too slow.
Gas prices weigh on retail sales

NEW YORK (CNNMoney.com) -- Retail sales fell for the first time since February as rising gasoline prices took a toll on consumer spending in June.

The Census Bureau said Friday that sales overall fell a surprising 0.1 percent last month following a 0.1 percent increase in May. Economists surveyed by Briefing.com had forecast retail sales to gain 0.4 percent.

"The weakness in June should be considered an indication of weakness in household spending which must be viewed seriously as a signal of where earnings and credit quality will trend in the second half," said Richard Hastings, economic advisor at the Federation of Credit and Financial Professionals.

For those who are in favor over a massive die off, we're working on it...

In agricultural terms, the world appetite for automotive fuel is insatiable. The grain required to fill a 25-gallon SUV gas tank with ethanol will feed one person for a year. The grain to fill the tank every two weeks over a year will feed 26 people.


A different sort of "left behind", isn't it?

(Actually if this is a good number, I think the horror of it will get some traction.  I mean, what better image than a large lumbering SUV taking food from the poor?  That kicks the middle class self-image right in the teeth.)

Someone pointed out yesterday that social change may be happening as more people view SUV's as the energy waste they are.  I'll be so glad when I don't get looked at funny when I give a damn about the planet.
Detroit is not going to give up so easily.  This morning I saw a commercial for a Hummer in which the narrator asked prospective male car buyers to consider their "manhood" while showing a grinning young man sitting back in his new oversized heap of metal.  I am not making this up.  

Can criminal charges be brought up against an ad agency (and its client) for sheer idiocy?  Just asking.

I've seen that one.  There's the one for the woman, too.  Another woman and her kid cut in front of her at the playground.  So of course she goes and buys a Hummer, to restore her manhood.

It's almost a parody of itself...

It's noce to think about how people will be looking back at such commercials in just several years. Pain is the best reason for getting smarter.
I thought this was one of those anti-Hummer commercials put out by computer savvy activists. But no! It was the real thing:


Note the link given at the end of the ad takes you to the official webpage where you can watch the ad:


I couldn't make this up if I tried!

oh God, it gets worse. look what I found:


this is being put out by people being paid lots of money?

Never mind the question:

The answer is oral sex.

Wow, that's really amazing. I mean, here the monsters go around wrecking cities--destroying their environments, if you will--and it turns out that their offspring is a "little monster". As a naive viewer, of course, what I take away from this is that their little monster will also wreck cities and destroy enviroments.

That's quite a message.

Ignoring the underlying message that making a hummer means you must destroy a city.

I don't thing this commercial will appeal to the target audience.  It's to cute.  Now if the hummer morphed into a robot and killed the monster, THAT would sell hummers.

That commercial is real, was highly successful, people loved it, and it aired during the Super Bowl.

Now, does anyone really still believe this society can save itself? ;)

Not a chance in hell GreyZone...

Today I pulled up next to a gigantic Dodge (?) 2500 pick-up;  so brand new that even the (oversized knobby) tires were still shiny...

Sticker on the window read:  "Bad Ass Boys Drive Bad Ass Toys"

Oil at $80, gas going to $4, war in the Middle East - this apparently does not leave the slightest impression on the "Bad Ass" driving this dinosaur...

I fear we are starting to enter the rapids just before we go over the brink at Niagara Falls...

I saw a commercial for a Hummer in which the narrator asked prospective male car buyers to consider their "manhood"

These ads cost millions of $$$ to run across the country.
They don't spend this kind of money without having done the focus group research first.
Obviously the message appeals to the targeted demographic. Think what you want, but "they" are going to buy their Hummers so as to establish themselves as the Alphas of the road.
There are commercial failures and all the focus groups in the world won't change the fact that this does happen.
Very true.

There is a certain demographic that is going to buy into Pessat's "Zero Ego Emissions" approach.

There is a certain demographic that is going to buy into Hummer's "Who's the Girlie Man?" approach.

All human behavior can really be boiled down to the need for food, sex, and status.
What was Mother Theresa after? ;-)
This ties in nicely to the 'You might be a redneck...' series:
If the tires on your truck are more than twice as big as the tires on your house.... you might be a redneck.

Actually the Hummer is probably only for the redneck lottery winner.

One would expect advertising execs to do their homework, but big corporations get desperate and screw up sometimes too....

Hummer forgot to spend $10 to register the motto, Restore Your Manhood (who are looking for creative anti-Hummer contributions). It sounds more like an ad for Viagra than a car - corporate efforts to undermine their consumer's confidence in order to get them to buy things tends to work better when it's subtle, when they overstretch like this a few more people might scratch their heads and start to get it.

I think that GM is working hard towards short-term goals and slowly destroying themselves, a long-term trend for the American auto industry.

OK...am I going to have rotten tomatoes thrown at me for driving a Toyota RAV4?  It gets 30 mpg on the highway, which is way better than my Subaru wagon ever got.

I have 2 kids and a big dog.  We use it less than our Prius.  Sometimes we need to haul us all around.

I for one bear no ill will toward RAV4s ;-)
Just curious. What is your real world gas mileage? I know what the EPA numbers are.   I'm just hoping that come out with a hybrid RAV4 or a hybrid Matrix.  I'm happy with my Prius but my wife wants the second car for snow to be AWD if, when we replace the Subaru.  
a good database of real world numbers here:


Hey...that's my baby right there...even the same color:


The Ford Escape is a small hybrid SUV.
I looked into it, but with Ford's problems and horrible customer service (in my town). I went with trustworthy Toyota.
I have a friend who has an Escape and loves it. But he got a real deal on it though. Someone traded an Explorer on it but was unhappy with it in less than a month and traded it back to the dealer for another (bigger) Explorer. The dealer needed to unload it as a used car even though it was practically brand new.
Wish we had bought the RAV4 - we got a Santa Fe instead because it had more room and a better 4WD system.  It is a wonderful vehicle, but that 4WD system sucks up the fuel.  Now it lacks the one virtue that will matter more than any other.  

Stupid of me.

I had originally gotten on the 2006 Prius waiting list (it now has a hatchback so it could serve as a packmule, but barely), but the wait was 18 months.

I couldn't wait that long.

Actually, if those are good numbers, then every car run on agriculturally produced fuel looks like a horror, even if large SUVs look quite a bit worse. Agriculture provides "us" with something like 120 watts per capita, and in the developed countries, "we" use something like 6000-12000. That's two orders of magnitude. Even allowing for cellulose - still in the future but maybe it will arive - can photosynthetic conversion of sunlight at 0.05% or so ever be more than a microscopic silver BB?
You're right.  I equate E85 and SUVs right now because they are bound in the public message.  You know, switch to yellow gas caps and buy that new Avalance.

if we must resort to biofuels it just becomes that much more important to use them frugally and efficiently.

(I wonder ethanol vs. biodiesel which is more suited to the "remainder" being human food?  And how that equation can be improved.)

I agree.  But the whole appeal of Ethanol in the public mind is that it can be used without changing much of anything.  NO CHANGE is the key point in this message, and that will most certainly include how much we use in the minds of most people.
One down (hydrogen fuel cells), one to go (corn ethanol).

(Actually hydrogen may be the "undead" and need a few more stakes through its heart.)

But the whole appeal of Ethanol in the public mind is that it can be used without changing much of anything.  NO CHANGE is the key point in this message, and that will most certainly include how much we use in the minds of most people.

I tend to forget just how little the general public actually understands about the ethanol situation. This morning, I got a call from a college buddy that I hadn't talked to in several years. The guy has a master's degree in chemical engineering, and then went on to law school. He now works as a patent attorney.

The subject of Peak Oil came up (as it often does when I am talking to someone) and it was all news to him. He asked if we couldn't just transition to ethanol. He said that was his understanding from media reports! This is a very serious problem, and is the reason I am so adamant about ethanol debunking. The average person does not understand the gravity of the situation we face, and they are going along happily with their lives thinking ethanol will allow us to maintain the status quo. We have got to do a better job at getting the message out. The public is not getting it, and this is too serious for them not to "get it".

End of rant.


I am not complaining about the local ethanol factories running or planning to be built. They have a positive EROEI and saves oil even if that party depends on cheap biomass for process heat. There is a fairly widespread knowledge, at least in technical and political circles, that they wont be enough and that seems to help parallell efforts, mostly biogas and biodiesel but there is starting to be more buzz about hybrids and plug-in hybrids.

You are perhaps overbuilding in ethanol plants. Friends who are farmers probably thank you for that since a higher world market price will help them and it will also provide motivation to build in height and not area in the local farming areas where we have growing towns.

It will make the ethanol and biodiesel more expensive but there is a risk for runaway oil prices will cancel out that problem from the farmers point of view.  

I have yet to encounter anyone (outside of cyberspace) who has even heard of peak oil.  But when you explain it, the first two things out of their mouth are hydrogen an ethanol.  If you point out how neither of those are plausible solutions they tune you out.  People (in the current era) are just wired for optimism. They have faith in capitalism, democracy or god so they don't need anything else.

It doesn't mater whether they lean left, right or center Americans just don't believe bad things will happen to them.   About the only things they are afraid of are Muslims.

I have yet to encounter anyone (outside of cyberspace) who has even heard of peak oil.

I have.  It was quite strange.  She was a friend of a friend - someone I see maybe once a year, for a few minutes at most.  The topic of conversation turned to high gas prices, and the next thing you know, she's talking about peak oil, dieoff, guns, etc.  Apparently, she hangs out at Kunstler's blog.  

Everyone else thought were were crazy.

That sound like a strangely pleasant experience.
Makes me think we should strive for some kind of representation outside the web.

Maybe something like the Moose or Elks club my dad belonged to.

Loyal order of the Drum?
The Oil Club?
The Fraternal order of the Oil Well?
Peak Oilers anonymous?

I'll have to give the name some thought.

Oil Watchers Anonymous.

(A 12 step program;=)

Depends on who you are talking to. I went back to my hometown over the Fourth. Three out of the five people I had extensive discussions were peak oil aware & brought it up without leading comments beyond a general discussion on gas prices.

The sample was undoubtedly skewed. All three have various technical degrees and have an uncommon propensity to think about how things work ... although they usually don't come up with the same answers ... those three did in this case in terms of at least recognizing the reality if not the timing of the issue.

BTW, only one of the three thought that we were screwed no matter what, so I guess by the standards of many on this forumn, the other might not be considered truly tuned in.

The guy has a master's degree in chemical engineering, --now works as a patent attorney.  --PO is all nws to him.

Talk about super specialization! (What's his reg number?:-)

Yes, of course.
You are going to run into:

  1. brain surgeons who are clueless about PO.
  2. Certified Public Accountants who are clueless about PO.
  3. Energy Consultants who are clueless about PO.
  4. Specialized specialist Xs who are clueless about PO.

Every one of them fills a very narrow niche in our Smithian Society and performs his or her work in that specialized niche with the assumption that the invisible grasping device is taking care of everything else.

So your ChemE patent attorney friend (to pick an example) may be able to recite to you from memory all of subsection 2112.01(d)(VII) of the MPEP but he's never heard of Peak OIL my gosh !!! Well there is a very simple reason for that. He has his ostritch head buried inside MPEP subsection 2112.01(d)(VII) and is busy studying it every day (just kidding). It is understandable why he can't know everything. Nobody can know everything. It's hard enough to know Chemical Engineering at a Master's level. And then add all the complexities of patent law (a really esoteric area) on top of that. His plate is overfilling already. And now you want him to take notice of this obscure "Peak Oil" thing? Come on. Be realisitc.

How does the Hummer company get him to take notice of Hummer-Manhood? Does he know about Hummer-Manhood? Did you ask him that? Hmmm.

How does the Hummer company get him to take notice of Hummer-Manhood? Does he know about Hummer-Manhood? Did you ask him that? Hmmm.

Funny you should mention that. We talked about my recent trip to L.A., and I told him about all the Hummers humming along at 80 mph on the freeway. He said "Do you really think people driving Hummers is a problem?" I didn't ask, but it made me wonder whether he drives a Hummer.


wonder whether he drives a Hummer?

There is only one kind of man:
         a Hummer-Man

Welcome to Hummer-Man country

You thought I was joking, huh?

A Hummer-Man takes immaculate measures
in the care & feeding of his Humm-accessories

(Right click & View Image to see better)

Warning: These are not to be treated as boy toys

I have never personally met anyone "in favor" of a massive dieoff. Many people do believe it is inevitable though, something that we simply have very little chance to escape. There's a difference and trying to characterize all people who expect dieoff as somehow taking delight in it, is a gross misrepresentation. Yes, there may be some who look forward to it but I believe most who see the dieoff coming see it with great sadness.
Help the situation by feeding the suv owners to the poor.
Today at MSN Moneys website:
Why now's the time to buy an SUV
$3 gas has turned guzzlers into white elephants. If you really need or want a big truck, the bucks you save could buy a lot of fuel.
Peak Drumbeat? There were 358 comments yesterday! It's a full time job to keep up these days :)
I second this!  
Already 364. I guess we were a little bit excited about the run-up in the oil price yesterday, following the huge drop of US inventories (which I think was the real underlying reason).
From 321energy.com:

Nymex LCS at $79.25 as I write this.

Will we hit $80 today?

That's the Sept. price not the Aug., just to be completely clear.  The prices as I type this are $79+ for Sept. and Oct., and $80+ for Nov. through next August.

Frankly, I don't care if it hits $80 today.  The price runup we're seeing has zippo to do with peak oil and market fundamentals, and is driven by fear.

Actually, I probably do want to see the price spike just a little higher, as it would serve to put the fear of the marketplace into consumers.  We have an immense amount of psychological inertial to overcome in getting people to conserve, and it won't happen quickly, cheaply, or painlessly.  A few sharp shocks will do more to accelerate that process than a long, slow rise (or boiling of the live frog, to use the common imagery).

The permanent "fear premium" has been in place since before the USA invaded Iraq. I wouldn't expect it to leave anytime soon.
It sounds like someone has made ALOT of money from this "fear premium".

Seems a bit unethical.

Ha...that is precious!!

Now, can you make a Mini-Dick?

I believe George already has one.
Whom are you talking about?  If it's someone specific here, then by all means produce some evidence or apologize for the "unethical" part of you post.
Haaa...I'm sure no one here at TOD has made a bundle off the fear factor.  No, my implication would be those that have the ability to "inflame" the fear factor and then watch their friends and family rake in a little bundle through companies like Halliburton, Blackwater, etc.....

Sorry, wasn't pointing fingers at anyone here...

....unless, of course, if Dick, Don, or George are members in our little community....if that is the case, then I did mean to insult you.
Hmmmm excessive fear premium may lead to excessive optimism if even part of the fears turn out to be unjustified. Markets are like people - they are very prone to wishful thinking. Many people hope and wish for another optimism/cheap oil/growth cycle to be just around a corner and for example a settlement in Iran may trigger an excessive sell-off. This may play a very nasty trick to our long-term future.
Well... fear seems to be a positive feedback loop.

Fear leads to price increases which in turn generate fear.

OTOH, in the WSJ yesterday, page A2 was this article headline:

Chinese Imports
Of Crude Surged
15.6% in 1st Half

So I suspect what we really have is a demand crunch.

The "fear premium" makes more sense today than anytime since Iraq War II began. Instead of finding Middle East meltdown easy to imagine, it is increasingly difficult to imagine it NOT happening.

Here's the latest from the London Times. "Baghdad starts to collapse as its people flee a life of death."

The dam has given way, and the civil war everyone has been dreading is now in full flood. The price of a lorry ride to Jordan has risen from $200 to $750 in two weeks, as anyone with money flees the convulsing city.

Basra has been in this state for a bit longer, as the Sunni minority has been cleansed, and the Shi'ite militias are starting to fight amongst themselves.

And with the new war in Lebanon, it is easy to see an escalation causing World War I.

As Lord Grey said in August 1914, "the lights are going out across Europe. We shall not see them again for a long time."  

Thanks for the correction August/September.

Lou, what is your definition of market fundamentals? Obviously, it appears that wars in the Middle East do not count. And once you've defined that, what is your view of the current fundamentals?

Obviously, prices are not high enough to promote conservation. Especially in China but also here in the US of A.

Market fundamentals: Supply and demand, interacting through the price mechanism.  Hurricanes, wars, etc. affect markets via their influence on fundamentals--taking oil off the market and driving up price.  Fear factor pushing up oil is speculation, not fundamentals.  (This is not to diss speculators; I think they play a critical role in helping us to extend our planning horizon.)

My view of the current fundamentals is pretty much what people here would expect--supply is very tight, demand is proving to be very robust in the face of rising prices.  I think the oil market will continue to be a weird and highly fluid mix of fundamentals and other factors for a long time, as in decades.

Be careful about assuming prices aren't promoting conservation.  If prices hadn't risen in the last year or so, consumption would be even higher than it is now.  Rising prices put downward pressure on demand; normally this effect is large enough to overcome underlying economic and/or population growth so that the amount consumed declines in absolute amount.  But it's quite possible to have rising prices coupled with rising demand when that demand reduction is small enough to be swamped by other factors.  (This downward price pressure vs. decline in total demand distinction is one that MANY mainstream journalists don't understand, which leads to a lot of economists grinding their molars...)

Over @ urbansurvival.com they are talking up Mon/Tues as a BLOCKBUSTER selloff that will rival the 87 crash.  If you go there you'll find a graph where he's got 4 crashes lined up and compared to current conditions.  I say any day could be THE day.
Cool.  I've got so many options as to what to do with my 401K money - let's see, shall it be stocks or bonds....  I don't rate my odds of ever seeing much of that money very high.
I managed to talk my mom out of stocks 2 days prior to the May downturn.  I kept tellin her to move her money and she finally got around to it 2 days before the sell off began. She was peaking in her portfolio.  She said she lost a lot nominally still in the few days she put it off, but not large % wise.  She was pretty happy and she's still got 10 or so years till she quits.
I saw that too Dave and reckon it could be a data error - $79.25 down 30c on the day!
Water Temp in GOM (off Panama City, FL) is starting to get up there.  It was up over 91F yesterday.
Temperatures are well above normal over much of the eastern seaboard, not just the Gulf. For example

A huge section of the Atlantic Ocean off the East Coast is much warmer than normal, and that has weather forecasters nervous as hurricane season gets underway.

A mild winter and prevailing southerly winds are the likely reasons water temperatures are above normal in a million square kilometres of ocean. A mild winter and prevailing southerly winds are the likely reasons water temperatures are above normal in a million square kilometres of ocean.

"I haven't seen a warm water anomaly quite as big as this in a while," Chris Fogerty, with the Canadian Hurricane Centre, told CBC News.

Recent readings showed temperatures were two to five degrees above normal in a million square kilometres of ocean stretching from off the coast of Maine to the Grand Banks off Newfoundland.

In Gore's film, he talks about the Gulf Stream slowing. Would this give more time for tropical waters to heat up before moving north?

Umm by definition that is the Gulf Stream.
It will get cooler in the North and warmer in the south.
Very nasty indeed.
Prior ice ages appear to have been preceded by periods of warming, which in turn greatly weakens or shuts down the Gulf Stream, which in turn then brings on advancing ice from the north. Sometimes, like 8000 years ago, the trend reverses and warming resumes again. Sometimes it does not and the world moves into an ice age. Geologic evidence exists to suggest that the transition time from warm age to ice age is as little as 5 years.

Here is an interesting link about rapid climate change. Perhaps the most interesting thing to note is the resistance of humans, even scientists to the very data in front of their noses. The data for rapid climate change was there a century ago but it took nearly 80 years for that idea to begin to break through the general science consensus. Today rapid climate change is fairly well accepted.

Here is an interesting article that documents the entire mental shift that occurred in the scientific community about rapid climate change. First they had to convince themselves that it could happen in as little as 1000 years, then in as little as 100 years, then in the span of decades (or less).

The truth is that we don't know what global warming will do but in either case, we can be sure that things will not stay the same. We may end up with a generally hotter planet or we may trigger the onset of a new ice age. Either event would likely be catastrophic for mankind as vast agricultural areas would become unusable and before new areas became usable, billions might die.

Human civilization arose within a very narrow climate band that occurs for 20,000 to 40,000 year stretches in between 80,000 to 140,000 year stretches of ice. For us to drive the climate out of the narrow band in which our civilization arose without first understanding the consequences thereof is foolishness beyond belief.

At a community planning meeting last night in Treme (New Orleans, primarily black working class neighborhood, ultra historic about 80 average people attending), there was a lot of community support for dropping ~1.5 miles of elevated I-10 and forcing traffic onto city streets as well as debate over best places to put streetcars & more bike paths/lanes.  As someone said "We're not going to be driving cars like we used to".  Replacing buses with streetcars was seen as a VERY good thing.

Changes in zoning and "spread the stores around" so some were within easy walking distance of all.

The magic words' Peak Oil" were not uttered, I doubt if anyone besides me had heard of King Hubbert, but they "Got It".  No one knew latest NYMEX quotes.  How, I am not sure.

On the surface, an "unsophisticated", hard working blue collar group; but FAR more astute than the average US citizen.  And more action orientated than the average TODer !

I spent an hour on the sidewalk talking afterward a 2,5 hour long meeting and then "Hey, lets stop feeding the mosquitoes, I have some good gumbo on". So dinner as well :-)  Home at 11:30 PM.

Frank discussion on a large # of topics, rich people coming in from the FQ (the gays have been good neighbors, but I don't have no use for those rich out-of-towners that spend 4 weeks a year here in their condo), politics, race relations, etc.

Hi Alan, I thought of you when I saw this in an article published today:

Over the long term, the Gulf needs to engineer stronger levees and to use the natural flow of sediment from the Mississippi River to rebuild the islands that once acted as a shield from hurricanes.

Source: Science and Sustainable Rebuilding. Not sure if it covers street cars, but I'm glad you do!

If I'm understanding you correctly, how on Earth would forcing heavy through traffic and heavy truck traffic from the Interstate onto the city streets square well with bike lanes and pedestrian friendliness???
Go to online map of New Orleans.  See triangle of I-610 on one side and I-10 on other two sides.

Through traffic should take I-610, not I-10.

The part to be dropped is from Elysian Fields to Canal Street (we have cool street names here).

Both Elysian Fields and Canal are major streets (6 lanes from I-10 to the river).  Traffic will flow more on them than on smaller streets that use Esplanade & Orleans exits now.

Not as convenient for New Orleans East or Slidell commuters (both largely depopulated now).  If/when they repopulate, there is a new commuting reality.

Major maintenance will be required on I-10 in a few years; cheaper to tear down (and better IMO) than fix.

Dropping I-10 will allow Claiborne to retun to it's former prominence as a small business center.

Auto sewers repel people; slow, difficult traffic encourages people.  I uset he contrasting examples of Magazine (6 miles of vibrant shopping, small shops BUT terrible driving & parking) vs. Tulane (6 lanes, no left turns, auto sewer) with dead commerical activity.

I get the same vibe from the blue collar folks in my part of Bostonistan. At $3 a gallon, they're treating their cars as the means to commute, plus a trip a week to the stores. The car is already no longer a device for discretionary driving as far as they are concerned, so they're already looking to other means (which means  grousing about MBTA bus frequencies, which are woefully low).
Really appreciate the yeoman's work you're doing in the big easy and how you keep us informed.
Just watching Bloomberg TV,   Bank of America CEO says oil could hit $85-90 if things don't change in the ME.

He says this will be a "tipping point" for the economy.

...and this is before Hurricane activity even starts.   Eeek!  

 I figured it wouldn't be until next year before $100 oil was in striking range.  

It's all about population!

I'm really depressed this morning. the world's ending and I don't even have my apocalypitc religious cult up and running.
Infilrate and subvert the scientologists.  (Rob Schneider voice): You can do it!
Peak oil is as good a secular doomsday cult as you could ever hope for. You'll always have that.
Doom soon?

Get in high-gear preparations now!

Get some "afternoon delight" TODAY.

If you know what I mean . . . .

And cheer up, the end is near;-)

i am ready to play rem 'it's the end of the world as we know it' if/when the bombs start falling.
especialy if they are nukes, i live close to three posible targets, a national guard base/depot, kansas city and it's second largested rail road center, lawrence kansas.
so chances of my survival in that kind situation are kind of low.
All three of those are air burst targets. What is your distance to probable ground zero? I can give you a quick rundown on what effects would be likely from the most common Russian strategic warheads. Also, as air burst targets there would not be appreciable fallout, so unless you have "hard" targets to your west within 800 miles, you'd not likely receive large amounts of such. (Yes, I did these sort of calculations professionally once upon a time in what seems a lifetime ago.) Russian ICBMs generally utilize 550 kiloton warheads.

For reference, the 5 PSI overpressure blast wave extends outward from such a weapon approximately 3.5 miles. Beyond that, you'll be under 5 PSI, which can still damage wood frame houses but usually doesn't destroy them. The 3 PSI blast wave extends out to 5 miles, which destroys windows but doesn't usually seriously damage a wood frame house.

Russian submarines have upgraded to more warheads at lower yields than in the past, replacing 300 kt warheads with 100 kt warheads (up to 10 per missile in a MIRV configuration). A 100 kt warhead has a 5 PSI radius of 2 miles and a 3 PSI radius of 2.8 miles.

So, if you are more than 5 miles from probable ground zero of those targets, you're very likely to live through the initial attack. Consequently, depending on your personal inclinations, you might either (a) think about a fallout shelter, or (b) move closer to the target. ;)

We can master one out here for no more than half an hour :)
All we need is a good marketing strategy and an agreement on the salvation part...
May I suggest the Anti-Yerginittes for a name?
That's funny. I too noticed that the world is ending, and yet, I can't even muster the energy to care about anything other than the esoteric, non-energy-related research for my real job right now. And I can guarantee that what I actually research will be totally irrelevant for the world when the apocalypse gets here. It's amazing that despite the effort I've given to TOD (nearly non-existent, of late), I still can't see the error of my ways.

No cult, but do you have your S&M gear and hockey facemask ready to go?

yes, yes I do.
I never point paintball guns at people who may have real ones.

I am a wise old coot.

And the worst part of it this happens to me every time the world comes to an end. When will I learn.
Some nonsense from the New York Times Bush Begins Advanced Course on the Ways of Putin
Mr. Bush is expected to tell Mr. Putin that he wants to see Russia succeed, yet also believes that its best interests can be secured only by pressing forward with ______. The message includes a pledge of rewards, including deeper integration into the world community, with Washington's backing.
I phrase _______ is
  1. oil and natural gas exports
  2. democratic reforms
  3. a hair transplant
  4. open and free markets
  5. energy security for the FSU and Europe
  6. none of the above
  7. all of the above (1-5)

Points 1,2 and 4 are essentially the same thing said in different ways. Whichever of them it is Moscow knows how to read the message.
8. Staring into your beautiful deep blue eyes.
The ME and this, and this:

Iran reportedly buying high tech arms from Central Asia (which is a no brainer)

Topics: iran  military  defense  

Iran is shopping for military high-tech weapon systems from three Central Asian nations for the last two months and is paying great sums for them.

Iran has sent nine delegations in the past two and half months to Ukraine, Belarus and Kazakhstan to scout for high-tech air defence platforms.

Though formal agreements are yet to be signed due to minor differences, Iran is attempting to buy these weapons on a fast track in the background of a possible confrontation with the West over the nuclear issue.

Details of weapons ordered have not been received, but Iran has been trying to obtain long-range systems to neutralize any Western adventurism.

Iran claims to have received some anti-aircraft missiles and air-to-air missiles from a Central Asian nation which can engage the enemy at a distance of two hundred kilometres.

and this
Eleven Israeli civilians injured by dozens of Hizballah rockets fired into northern Israel Friday, on the third day of war

July 14, 2006, 3:08 PM (GMT+02:00)

Two were seriously hurt in barrage aimed at Safed town and nearby military installations. The IDF base at Biria took a direct rocket hit from Lebanon and suffered casualties. Another hit a house, setting it on fire. Two Israeli civilians were seriously injured in another targeted house near the IDF's Northern Command HQ. Two Israeli civilians were killed in Nahariya and Safed Thursday and nearly a hundred injured by more than a hundred Hizballah rockets.

Also Friday, July 14, Israeli soldiers fought off a second Hizballah incursion for abductions. The Shiite terrorists crossed the border at the Zarit post, near the spot where they kidnapped Ehud Goldwasser and Eldad Regev on July 12.

The Shiite terrorists crossed the border Friday at the Zarit post, near the spot where they kidnapped Ehud Goldwasser and Eldad Regev on July 12.

Israel is under fire on two fronts Friday: Hizballah rockets again hit Safed, Kiryat Shemona, Nahariya, Rosh Pinah, Biriya, Ramat Arazim, Hatzor Haglilit and Baram. No injuries.

In the south, Palestinians shot 7 Qassam missiles from Gaza into Sderot, sending 9 Sderot civilians into shock. Three missiles exploded at the IDF Nahal Oz base and Kibbutz Gevim outside the Gaza Strip. No one was injured.

Thursday, the first Hizballah rocket landed in Haifa, one of Israel's three main cities and petrochemical industrial center. Hizballah denied sending the rocket which hit a street in the Stella Maris suburb near an Israeli military base after dark Thursday. No immediate word on injuries. Residents of Haifa and its environs ordered to shelter in protected areas, placing more than 700,000 Israeli civilians in shelters. More than 100 rockets landed on northern Israel in a single day, 90 Israelis were injured, one woman killed in her home in the coastal resort of Nahariya which was battered by Katyusha fire through the day.

After dusk, several more people were injured when another volley hit residential streets. Residents are fleeing south with children. Safed took another round of rockets after dark and more casualties. One fatality reported, the second of the day. After nightfall, Hatzor Haglilit, Amiad and Korazim came under attack.

Thanks for gathering & posting this news.
Iran's Objective is to distract the West from further interest in its nuclear program with the Israel-Lebanon conflict.
Iran's Objective is to distract the West from further interest in its nuclear program with the Israel-Lebanon conflict.

What is your basis for this line of thinking?

They're shopping in the high-tech sector of the Kazakhstani market? Should be a short shopping trip.
Do not believe so much of what you read about Iran's eagerness for conflict.
Count me as an unreliable source if you want, right now the war drums are beating, there are vast propaganda efforts underway, there is no trustworthy info to be had.
Ukraine and Belarus just moved from Europe to Central Asia. Is that what your source says?
And you might want to look at this (I know, it is prejudiced against Iran - the loving Mullahs):



Iran heavily invested in North Korean missile program

LONDON -- Teheran has been financing Pyongyang's intermediate and ICBM programs for nearly a decade, Western intelligence sources said. The funding has been part of a deal in which North Korea would share missile technology and equipment with Iran.

"Anytime you hear of a North Korean success, translate that directly into an Iranian success," an intelligence source said. "You can be sure that within a few weeks, Iran will receive briefings, training and eventually production expertise from Pyongyang."

Iran is believed to have invested more than $1 billion in North Korean missile development, the sources said. In 2005, North Korea increased missile technology transfers to Teheran as it sought to accelerate the Shihab program.

On July 4, North fired six missiles, including a Taepodong-2, with a range of between 3,400 and 4,000 kilometers. But the flight of the Taepodong-2 lasted about 40 seconds and the missile fell in the Sea of Japan.

U.S. National Security Adviser Stephen Hadley said Pyongyang also fired two Scuds and three No-Dong missiles. Hadley called the launch of the Taepodong-2 a failure. A seventh North Korean missile was fired on July 5.

The sources said Iran has used North Korean technology for its Shihab-3 and -4 intermediate-range missile programs. Teheran has also sent Iranian engineers to Pyongyang for training in ICBM development.

So far, Iran has developed a Shihab-3 with a range of 2,000 kilometers. The Shihab-3 is believed to be a variant of North Korea's No-Dong, with a range of 1,300 kilometers.

"They [North Korea] have decided as a strategy to proliferate weapons of mass destruction, it would appear," Gen. B.B. Bell, commander of the U.S. military in South Korea, told a briefing on May 24. "They decided as a strategy to make missile technology and other technologies for sale on the world market to the highest bidder."

If Bush did anything right, he build a limited ICBM ABM system during his regime and it is also on our AEGIS cruisers. It may or may not work, but it is better than nothing.

Perhaps North Korea will simply sell the bomb to Iran...
In a round about way this could explain the lack of refiners in Iran.  They simply have been spending their money elsewhere (Hezbollah, Hamas, North Korea......).
PS:  The missile shield has never successfully intercepted a missile. Unless you want to count the times they put a homing beacon in the target missile.  

Interesting tidbit: During the Gulf War  no scud warheads were intercepted by the patriot missiles. All that spectacular footage was of spent rocket boosters  being blow up.  The system can discriminate against junk and a real warhead.

I wouldn't put to much faith in technology saving us from nuclear attack.

Oopsthe should have been " can't discriminate "
>Interesting tidbit: During the Gulf War  no scud warheads were intercepted by the patriot missiles. All that spectacular footage was of spent rocket boosters  being blow up.

For short range missiles this is an issue because the patriots hit and destroyed the rocket but failed to destroy the warhead which landed on populated area. However if a medium or long range missile was to be fired, the patriot would destroy the rocket before it could reach its target. If the rocket is destroyed over a non-populated area or over the enemy's territory, this would be successful enough.

> wouldn't put to much faith in technology saving us from nuclear attack.

Its till better to have something then nothing. Although a nuclear strike on the US from Iran will very not likely occur from a long range missile. It would be far more practical for Iran to use its terrorist networks to deliver a bomb. A missile defense serves against a accidental launch from a major power or perhaps North Korea (although it appears NK does not yet have working long range missiles).

North Korea has a missile that doesn't work very well, and they call it "No Dong"?

such irony...

Interesting analysis from CSM:  The way in - and out - of Israel's wars

They believe the provocations happened because there was danger of peace breaking out in the Middle East (which would undermine the power of militant groups like Hamas and Hezbollah).  And also that the West's flat refusal to deal with Hamas contributed to the escalation of tensions, since it left moderates out on a limb with no way down.  

Sorry if this has been posted before. I found an interesting story over at the Green Car Congress: the Sandia lab has reportedly come up with a proposal for applying the "surety" concept - as known from nuclear weapon stockpile management - to energy issues. The proposal itself is available at DOE's Office of Scientific & Technical Information as a PDF file. Heaven't read the file itself yet but what's quoted at GCC sounds shockingly in touch with reality:
As humans, we are in a never-ending battle with the second law of thermodynamics, constantly using exergy to support ourselves and our surroundings in an environment in which we are in nonequilibrium. This activity (which consumes exergy) is in keeping with nature's biological tendency to use resources to create "order" around us. This consumption expands until the resources become exhausted and equilibrium with competing life forms is reached, but to let this natural process run to its normal conclusion would not be consistent with our current view of "civilized societies" because of the implications of societal collapse upon complete resource depletion.

We offer a three-step strategy for moving toward better matching of our exergy resources with our exergy needs. As a first step, we must improve the second law efficiency of energy conversion, transport and use processes. Secondly, we must attempt to close the cycle of the same processes taking into consideration the interactions with the earth's biosphere, at least when open cycles provide undesired consequences. The final step to obtain true sustainability into the indefinite future would be to harvest the earth's persistent exergy sources at no greater rate than which they are being made available to us.

Suggested measures include conservation(!) and population control(!!!). I invite TODders to study the proposal in its entirety and see if this is, indeed, a rare flash of common sense from this faith-based US administration. If it is, and if the ideas catch on (two big ifs right there, I know), the future might brighten up quite a bit.
That they mentioned population control is indeed interesting.  That's the most important solution, but one that's a political third rail, at least with this administration.
This is exactly what we need to do, but our global socio-economic-political system is so tuned to the unnatural paradigm of maximizing profit and externalizing negative impacts that I'm not sure we change this Titanic's course even if the will existed to do so.
AP is reporting that Palestinians have blown a hole in the border wall between the Gaza Strip and Egypt.  Witnesses say people are flooding from Egypt into Gaza.  

WTF?  I would think they'd be going the other way.  Unless they're soldiers or something.  

Here's the explanation:

RAFAH, Gaza Strip - Hundreds of Palestinians poured into the
Gaza Strip from Egypt on Friday after militants blew a hole in the border wall, an Associated Press reporter at the scene said.

The border has largely been closed since June 25, when Palestinian militants carried out a cross-border raid on a military outpost, killing two Israeli soldiers and capturing one.

Hundreds of people have been stranded on the Egyptian side of the border, unable to get to their homes in Gaza.

And Egypt was worried about a flood of refugees going the other way...

Tim Haab at Environmental Economics wants a question answered. I thought you might want to go help him out.
Doesn't it take longer than a day for oil to become gas?

Oil jumped to $78 per barrel yesterday.  My wife paid $3.30 for gas this morning.  I'm pretty sure it takes more than 48 hours for Middle East oil to become Columbus, OH gas.  So what's going on?  In short, expectations matter.  Prices are expected to go up in the future, so prices jump today.  Is this greedy suppliers taking advantage?  No just rationality at work.

If you decide to sell a stock that went up 20% in 48 hours, do you sell it at today's price or at the price 48 hours ago?

If you decide to sell your house, that doubled in value over the past five years, do you sell it at today's price or for what you paid for it?

If you own a futures contract for gasoline and/or oil, would you sell it at today's price or at the price 48 hours ago?

If you own several thousand gallons of gasoline, do you sell it at today's price or at the price 48 hours ago?

JDH says it best:
The answer is, because if the price didn't spike up immediately on the news, the result would be a disaster for the public. I presume we can agree that the supply disruption will eventually mean that the price will have to be higher and consumers are going to have to make do with less gasoline. How should you as a consumer behave, if the price did not go up today, but you know that in the future, you might not be able to buy gas or will have to pay a much higher price than you do today? The answer is, you should rush out and top off your tank right now, while gas is still available and cheap. Of course, when all your neighbors get the same idea that you had, the result is a huge surge in the quantity of gas everybody is trying to buy, which the system won't have the resources to deliver. Panic buying by consumers would create shortages even if there had been no disruption in supply.
I've also wondered about this. When the gas station owner has to fill his tanks tomorrow, he'll be doing it at tomorrow's distributor prices. In a rapidly rising market, you can't make money retailing gas at yesterday's price and replacing it with gas at tomorrow's cost. Also, if the station just down the street filled their tanks today, their prices had to go up to cover the increased cost. So you can put yours up too. Effectively, there is no lag.  

It's all about opportunity cost.

Recall Econ 101? That's all it is.

Hold your horses there, Don!

If the world ran like Econ 101 tells us it does, that's the only course anybody would ever have to take.

Of course there's a lag. That lag is the time between when the oil is bought at the higher price, transported to the refinery, undergoes refining and then is further distributed through the supply chain until it is finally bought by the company that owns the retail outlet and distributed to there.

If oil goes up $2.00 today and my gas goes up $0.30 tomorrow, that's called profiteering.

If the world ran like Econ 101 tells us it does, that's the only course anybody would ever have to take.

Gas is not "the world," it's simply a commodity of which somebody has a supply and for which somebody else has a demand.  Econ 101.

If I have a box of candy bars and I see a bunch of hungry rich kids coming, I'll sell them for as much as they'll pay.  My incentive to sell them at a higher price is even greater if I perceive my own cost is going to rise tomorrow.

The chain doesn't work that way and can't due to JIT delivery.  If you worked at a gas station, rather owned it, you may look at the books.  These shops generally are worried about cash flow issues and the only way to remain cash flow positive is to increase the cost of your gas now to be able to pay for the gas coming tomorrow at the higher price.  The retail outlets are not making ubsurd sums of money.  The oil majors are making plenty, but they aren't selling gas, they sell oil.
I'm not backing off on this. Physically, the supply chain works as I described it (simplified). I'm not concerned about the retailers, few of whom are independents, some of whom are franchised, some just owned outright by big companies. Look what Hugo just did with Citgo lately. Get it?

Decisions at corporate owned gasoline stations can be made instantaneously. The big boys at the top call somebody who calls somebody ... (this looks like a certain kind of network, called a tree) ... who finally calls the retailer and says change the meters, bump 'em up 30 cents.

If you took Econ 101 from me and used by textbook: ECONOMICS: MAKING GOOD CHOICES all would be clear:-)
Begs the question. I refuse to respond with the context (sometimes called a frame of reference or just simply a "frame") of Econ 101.
So for five bucks on amazon.com buy my book, read it and learn something.

For no fee, I will answer any questions you may have.

Do the "Thinking Exercises."

Also do the "Concept Checks."

Learning is possible.

That I believe.

If they are prudent businesspersons, they should be profiteering 24/7. That is the nature of business.  
Exactly. The goal of business is to make profits.
What is it called when the price of oil goes down - as it did in 1998, from 25/b to 10 - and the oil companies have committed projects assuming a 25 price deck?  This is when they lose money, to the extent that some e&p's went under. If companies can't profiteer when times are good, will you - or the public purse - protect them when times are bad?
I tried telling someone why our gas shot up $.19 overnight using this explanation.  They thought I was making it up.  People are too emotionally tied to oil to think logically.  They just don't want to hear why, they just don't like it period.
From the Environmental Economist:
So what's going on? In short, expectations matter. Prices are expected to go up in the future, so prices jump today. Is this greedy suppliers taking advantage? No just rationality at work.
Only an economist could think this way, completely divorced from physical reality. To these guys, it can be justified as some mysterious action at a distance in physics because expectations matter. This is used to justify all sorts of nonsense in the real human world, which is where I live. It should take some time for prices to rise. Yesterday, they bought it for $2.70/gallon and sold it to you for $3.00/gallon. Today, they bought it for $2.70/gallon and they're selling it to you for $3.30/gallon because expectations matter. Later, when their real wholesale cost is $3.00/gallon, they'll sell it to you for $3.60/gallon.

Expectations have no end, they just go on and on.

Rationality at work!

Expectation matter in the futures market, which translates to the real market.  If that's what he said, then its true.  But thats not the reason it jumped at the pump.
Here's the way I look at it:

If I were a gas staion owner I would know (a) my current retail price, (b) my supplier's wholesale price, and (c) my entire history of pricing strategies and results.

The superficial analyiss assumes there is no "c" and that this is all new thought.

I certainly don't know "c" but I'd guess that a strategy of re-pricing retail gas every day based on wholesale price is an easy (brain-dead) way to time-average and eliminate the "gottcha" when jump too fast in one direction or the other.

Certainly the other motivation is to maximize return, but independent of that, time averaging reduces risk.  Really the profit thing is about the amount you add onto the time averaged base line.

Isn't it as simple as selling the gas at "replacement cost" plus a margin?


Modeling human behavior is more complex than physics because the thing being studied can make decisions affecting its future. Atoms can't do that. How are you to model behavior if you can't model beliefs about the future consequences of actions taken today?

But, yeah, what do you expect? They are in business to make money, not weep over the harm they are doing to consumers. :-)

I believe they are seeing the gas increase related to an earlier rise of oil prices. One month ago oil was around 65/bl and started rising about 3 wks ago again. Gasoline drifted down till last week in my area and only showed the increase related to the rise from 65 earlier this week. We have yet to see the increase related to this week's increase in oil costs, but believe me we will over the next 2 weeks.
Okay I finally fell pray to the Blogging world.


Is a fantasy post of mine on a bio-fuel we have plenty of in the south.  We also have been trying for decades to get rid of it.  Why not use it.

Kudzu is ediable for human consumtion this site has recipes for you to try.


I have even considered growing it in pots to contain it. And I have a poem or two running around that talks about it.  

The point is that it grows without us watering it, spraying it for bugs, and if any other plant tries to grow in its field more power to it.  IF we can get bio-fuels from switchgrass, or corn, or soybeans, why not a plant that grows as much as 2 feet a day?

Harvest it like hay. Grind it up make your fuel. But the waste back out in the feild as something for next weeks crop.  You could get several harvest in a season it grows that fast.


In the summer it consumes everything in its path...trees, telephone poles, whole buildings, etc... but have you noticed what happens to it in winter?
Frost kills it.  Sheep eat, goats eat it, cows eat it, and even humans can eat it.  The roots are fairly deep as it is a plant that comes back year after year.   I think they do make chemicals that can kill it, but they also tend to kill everything else.

I have always thought that harvesting it for something would be good.  Why not this?

Using it is fine provided that you don't plant more of it! Fortunately it does not seem to produce viable bird-transported seed like privet or the entire south would be eaten alive. It appears to be impervious to chemical attack also. However enough goats will get rid of it because they are very diligent in digging out all those tasty tubers.
Then it must cotton the soil out pretty quickly, right?
The problem with kudzu is scaling down whatever you use to get energy from it. You could round it up for thermal deploymerization, but a single thermal depo plant is large, and would require kudzu harvests from a wide area, which means a lot of labor and energy, enough to make the proposition unprofitable.

If you could find a way to burn it for energy at the scale of a single household, well, you've just completely changed the peak oil prospects of the South. The problem is, kudzu is wet, so it needs catalytic assistance to make it burn clean, and that just doesn't scale down enough.

So for the moment y'all might as well just graze the stuff down. You aren't working to grow it, and not much else you can do with it, but you'll get to eat meat no matter how bad things get. Color this Yankee envious.

wet stuff is good for a methane bioreactor
How small can you make'm? Can you make them easy to maintain by laymen?
they use small bioreactors in asia, but they are also happy with small output for direct use (methane as cooking fuel).  no idea how it would scale, but i imagine it would take a lot of hand labor to keep the costs in line with outputs.
My personal nomination for champion 'biomass plant pest' is the tree-of-heaven.
It grows 6-7 ft a year, come up from the roots and the stumps sprout almost immediately after the tree is cut. It could produce a lot more biomass is a season on the same ground than kudzu because of the added height. Plus it self seeds rapidly.
In Tennessee, any bare patch of dirt will sprout something within 24 hours of our frequent summer thunderstorms. They are like dumping several tons of nitrogen fertlizer on everything.
Stratfor.com reports that Israel is calling up their reserves.   They speculate about whether Israel will launch a preemptive attack on Syria's air force, prior to a heavy incursion into Lebanon.
Wonder what Iran will do if Israel attacks Syria?


Israelis are a mean group when bothered.  They tend to make a point when they have something to say militarilly speaking.  I gotta love em.
But what are they really accomplishing? So they invade Lebanon and attack Syria -- will their security situation really change as a result?   They will still occupy other people's land, which will cause others to hate them and try to blow up their discos and markets.
Clarify your phrase "occupy other people's lands", please.

That's the meaning of Iran's de facto declaration of war against Israel--which is, ultimately, a new war Iran is waging against the US. Iran is so desperate for war with the West that it is bringing the war to us, openly and willfully initiating a regional conflict that may soon involve three of Iran's proxies--Hamas, Hezbollah, and Syria--fighting against America's proxy, Israel.

It is important to grasp that Iran is deliberately, intentionally drawing Israel into a war with its proxies. Iranian President Mahmoud Ahmadinejad has been making increasingly ominous statements warning about a "conflagration" involving Israel, then two Iranian-funded organizations run out of Syria, a close Iranian ally, launched incursion into Israel to kidnap Israeli soliders--a provocation that cannot merely be shrugged off, but which demands extended Israeli military action. Neither Hamas nor Hezbollah would have launched these attacks without Iranian permission and support.

It's interesting to think that Iran could be so cunning to work the small pawns in such a way.  If you read the whole article, you'll see this guy denigrate Europeans so we sacrificed the Isreali's following WWII.  Don't see it this way, but these people are surrounded by enemies.  Nothing like sleeping with them and all...

Worse, the Palestinian Authority is the one area where we have tolerated the creation of a new Islamist terrorist regime, on the grounds that it is "democratically elected." As I explained in "The Weapon of Democracy," in TIA's last print issue, this is how the US has been disarmed by the dangerously vague concept of "democracy": if we claim that we are fighting for liberty, and then we equate liberty with "democracy"--then how can we condemn a "democratically elected" terrorist regime?

More important, nearly every Lebanese political faction has paid lip service to an anti-Israel policy. So while they demanded that Hezbollah disarm, they also praised Hezbollah's past battles to "liberate" Southern Lebanon from Israeli occupation. Now, by provoking a new Israeli incursion into Lebanon, Hezbollah seeks to justify its military power.

This is easy to understand.  Basically terrorists know the game we are playing.  We're using the pretext of democracy as our weapon to extract oil resources.  This is what the American people believe anyway, so these organizations are working within the rules to establish their power.  In this powderkeg, Hezbollah can not be temepered in Lebanon because anyone who opposes Hezbollah is basically commiting treason against his country.  Who's gonna do that?  So Lebanon is in this full swing now.

The Iranians believe that they can head off a war with America by initiating a war with Israel.

When faced with the few reasonable choices that Iran has, this decision seems to make sense for Iran.

As Ledeen puts it:
No one should have any lingering doubts about what's going on in the Middle East. It's war, and it now runs from Gaza into Israel, through Lebanon and thence to Iraq via Syria. There are different instruments, ranging from Hamas in Gaza to Hezbollah in Syria and Lebanon and on to the multifaceted "insurgency" in Iraq. But there is a common prime mover, and that is the Iranian mullahcracy

Where's the pause button?

I don't buy the whole, "Iranians are the masters of intrigue" premise.

They are an oil exporter that rations gas.  That pretty incompetent.  An it looked like china a Russia were going to prevent us from invading Iran.

Just when they were going to get what they wanted (nuclear power/weapons) they instigate war with Israel?   Israel already has the bomb and some darn good delivery systems.

If Iran attacks Isreal for WHATEVER reason, do you think we're going to keep asking for permission to invade?  We unilaterally invaded Iraq, and we would love to bilaterally invade Iran.  

They instigated a war with Isreal so that they can bring that to either a worldwide stalemate since no one will probably back Iran or they will convince us to stay away and give them Nukes so they won't be a mean neighboor anymore.  What you described above is as crazy as the gamble muhajeed (can't spell) may be making.

IMO, if Iran attacks Israel, they are toast.

I'd be sorry to see that.

I have friends in Iran.

Also, I have friends in Israel.

In my more insane moments, I am tempted to become an assassin of fanatics on all sides.

I am curious on how they work, what makes fanatics tic?
On the other hand I am fairly certain that the answers wont be uplifting in any way. As far as I know I have only spoken directy with some local left wing nutjobs. This is a kind of field research that other more crazy people can do.

I dont think I have any friends in either country but a war is allways a waste of lives, resources and opportunities. This unfortunately do not mean that everybody loses, this region seems to be full of people depending on continued fanaticism and warfare to make a living and keep their status.

I get the impression that large scale and prolonged conventional warfare could destroy Israel as a nice place to live in and they are the best/only democracy in the region and they produce quite a lot of advanced culture. This makes any such war a larger loss for the western world then for instance the massive Iran - Iraq war. If it gets big enough nobody will realy win exept some of the people outside the fighting.

The latest local news is that the Swedish government is trying to organize evacuation of all Swedish citizens in Lebanon, about 4000 visitors and 500 living there.

I do not understand fanatics.

I wish they would all go on hunger strikes and die.

That would make the world a much much better place.

In 1914, who--in their absolute worst nightmares--would have guessed at the total casualties by 1919?

Small matches--the assassination of Archduke Ferdinand, the kidnapping of two soldiers--sometimes light big fires.

Is Israel a democracy? It doesn't recognize many rights of the Palestinians in the occupied territories. It refuses to annex the territories, because they would need to recognize large groups of muslims as citizens, and give them the right to partake in politics. But neither are they prepared to recognize an independent Palestinian state. I wouldn't call that democratic, more likely Apartheid.
Israel has frequently stated that they will recognize Palestine when Palestinians formally recognize Israel's right to exist. Simple, no? And since the Palestinians refuse to do this, continue using racist code words like "Zionists" and "occupation", I can only conclude that the bulk of Palestinians (and the bulk of Arab Muslims) are Jew haters and want to kill them all. Given this state of affairs, it makes perfect sense for Israel to neither annex those lands nor recognize a Palestinian state.

Further, Israel was created by UN mandate. In any global system of resolving issues, someone will always oppose the chosen solution. In this case the Arab Muslims opposed the formation of Israel (and an Arab state at the same time) and attacked Israel first.

If the Arab Muslims are ok in ignoring the UN mandates, then why are so many of you Israel haters so down on the US? The US violated a UN mandate in invading Iraq just as the Arab Muslims violated a UN mandate about the formation of Israel. If the US is wrong (and I do believe the US is wrong about Iraq) then by the same logic, the Arab Muslims are wrong and need to recognize and accept Israel's right to exist.

Otherwise, let's toss out the UN, pull out the entire nuclear arsenal and solve this the old fashioned way. Which sounds better to you?

Using racist code words like "Zionists" ... just like that darn Einstein:

While Einstein was a supporter of Zionism in the cultural sense, he often expressed reservations regarding its application in terms of nationalism. During a speech at the Commodore Hotel in New York, he told the crowd "My awareness of the essential nature of Judaism resists the idea of a Jewish state with borders, an army, and a measure of temporal power, no matter how modest. I am afraid of the inner damage Judaism will sustain."[37] He also purchased a full-page ad in the New York Times condemning early Zionists for their treatment of the indigenous Arabs, especially at Deir Yassin (New York Times ad).


Israel has frequently stated that they will recognize Palestine when Palestinians formally recognize Israel's right to exist. Simple, no? And since the Palestinians refuse to do this...

Not True.

The Hamas lead gov't of Palestine had announced a national referendum on precisely that question.  Then a faction of Hamas (AFAIK, connected more to a Syrian resident commander than the gov't) captured an Isreali soldier.

The captors offered to exchange him for the women and children held in Isreali prisons.  Isreal has made similar exchanges in the past (all before included men AFAIK), but this time they responded in a way that made the referendum (that Isreal supposedly wants badly) impossible.

If there is no vote by Palestinians on accepting the legitimacy of Isreal, the decision recently came from Jersuleum.

... accepting the legitimacy of Isreal

So Alan, do you as a spokesperson for all these different Palestinian factions, accept the "legitimacy" of the Jewish people having an ethnic homeland of their own, a country of their own, a place where they can freely maintain their Jewishness and not be persecuted because of their race and religion? Yes or NO?

And remember. Aside from your late-cast vote now, the United Nations already voted in 1947 with a resounding Yes.

I tend to agree that Israel will mop up Iran in a conflict, but whose to say Islam doesn't experience an uprising of 1% who support Iran and are willing to fight.  That's still like 10 million people (of 1B) willing to fight.  What is REALLY preventing Hezbullah and/or Palestinians from returning the soldiers to end this?
"I tend to agree that Israel will mop up Iran in a conflict, [...]"

How long will this "conflict" last?

Let's use the Irish situation as an upper limit (400 years) and work to more optimistic estimates from there.

Iran's youth would love to see the ouster of the Prez.  There are more youth than old, last I checked.  If their Prez is the one jumping in on this, with Israeli help I think they could take Iran down in months.  When I say mop them up, I guess I'm gearing that more towards destroying the country.  I KNOW Israel will destroy Iran if it comes to that.
Sort of like we "took down" Iraq?

Really, man.  You have to look at the historical precedent for imposing victory on hostile, and religiously antagonistic, populations.

They could "win" in months and still have another century of suicide bombers.

BTW, my understanding is that "the youth" have been moving to support the Iranian President.  There is nothing like an external threat to the tribe to puff up young males and have them take this role.  That is genetics I'll buy into.
You don't have to look to far for examples of what happens when Israel "Wins".

Palestine and Southern Lebanon are very obvious examples.

Israel also have enemies who cant accept to settle down after a defeat and make the best of what they have.

We would perhaps have had more of that withouth the Israeli settlers movement.

The idea that you have to fight for a god given piece of land for an eternal number of generations instead of trying to live with a defeat and make good of what you have is truly dangerous. This guarantees that a conflict never will end.

(We should take back Norway after the traitorous dissolvement of our union! They cheated us on OUR oil! And Finland is a historical part of Sweden since before we have written records! This foolishness with open borders must end untill the one true nordic kingdom reigns! )

We scandinavians lucked out with a fair bit of genetic, cultural, and religous uniformity. (said the dane/icelander/englishman).
It will be intresting to see how the new muslim minorities will integrate themselves.
We Danes rightfully rule all of Scandanavia, not to mention England and Ireland! History is on our side! Until ten million Scandanavian women are smoking Danish cigars and drinking Danish beer there will be nothing but . . . . peace and goodwill among peoples who fought tooth and nail against each other for nearly a thousand years.
Yes, but in the long run, Israel is a small country with few natural resources and a lousy economy, surrounded by much larger populations of people who hate them.  They are propped up by the US, else they'd really be in trouble.  

So what happens at some point in the future when Daddy Warbucks is broke, and ME oil fields have declined in a major way.  With that, Israel will have lost a lot of strategic importance to the US, even if we have the money to keep dumping on them.  

I simply cannot understand how the Israelis think they could be successful in the long run living in constant conflict with their neighbors.  It seems to me it cannot fail to fail.

"So what happens at some point in the future when Daddy Warbucks is broke"

That's an easy one to answer.  
It starts with a boom and ends with radiation sickness.
I believe they have a nuclear triad defense (land/sea/air).

Suddenly those noisy neighbors aren't a problem.

Egypt signed and has sort of honored a peace treaty with Israel.

Without Egypt, no war.

Without Syria, no peace.

The zionist delusion is losing its power.
Ah, when the facts fail, you run and hide behind the last letter of the alphabet: the z-word. Clever tactic. No one sees through your subtrafuge. You've fooled the whole world. Zippitee do dah. Zippitie yo yo ray. My oh my we get more clever every day.
No, I was making a factual observation. Thirty years ago, Israel's supporters could still claim that Palestinians didn't exist at all.
So is a peace treaty between Egypt (the largest Arab country) and Israel. Also, informal cooperation and peace between Jordon and Israel seems to be going surprisingly well. Or maybe it is not surprising, because the King of Jordon has zero tolerance of terrorists in his kingdom.

Not all historical developments have been negative. The peace treaty with Egypt and Israel has been in force for more than thirty years now.

I do belive that unrelieved focusing on failures leads to a serious fallacy of lack of proportion. Peace between Egypt and Israel is HUGE. By comparison, Hamas and Hezbollah are small potatoes.

And by what stretch can Israel be blamed for Lebanon's incredibly bloody and long-lasting civil war that mostly was Syria's fault and that only ended by Lebanon being occupied by Syrian troops for longer than Israeli troops ever were there?

Quote/ How long will this "conflict" last?

Let's use the Irish situation as an upper limit (400 years) and work to more optimistic estimates from there. /Quote

I believe the Irish conflict dates back some 800 years. Sadly, in the case of the Israeli/Arab conflict even 800 years seems overly optimistic to resolving their differences. The best hope for lasting peace in the region is significantly higher standards of living across the Middle East and that's simply not going to happen anytime soon.

Mop up Iran via Syria and Iraq? Some 800 km of hostile supply lines? They can bomb each other indefinately untill they use nuclear weapons and they can fight via proxy but a ground war victory would cost a lot and it would be the biggest military campaign since at least the korean war. Israel can probably do it but it would not be a simple mop up.

This is all madness. :-(

And the f**** maniac leders plays it as such.

Yes.  Today is not a good day.
Michael Ledeen is a madman.
... and not in a good way.
Yes, it would be foolish to put any creedance on anything he says.  Me thinks there are a lot of countries gaming this right now - don't know what is really going on.
Twilight -

That we don't know what is really going on is about the only thing I feel certain about at this stage in this growing  mess.

Even if one applies the 'cui bono' test, it is still not all that clear. At least to me.

For example, one could posit that the Bush regime (as opposed to the United States) would benefit from an escalation of the current situation into a broad Middle East war, for the following reasons:

  1. In an election year it takes attention off of the debacle in Iraq.

  2. It is part of the neocons dream of regime change in Iraq, Syria, and Iran so as to install puppet governments that will play ball with the US.

  3. It is part of the neocon and Israeli lobby's desire to make the Middle East a safer place for Israel by having the US help Israel destroy all of its enemies.

  4. In an election year it reinforces the notion that we are at war, Bush is a wartime president; and by golly, all patriotic American should stick by their president in time of war.

  5. The Bush regime may have decided that with the outcome of the November congressional elections increasingly in doubt, this may be their last and only chance to have their way in taking on Syria and Iran. If the Democrats take control over both the House and the Senate, a move toward impeachment may not be all that far-fetched.

Now, on the other hand, one would think that the Bush regime has learned some painful lessons by what a mess Iraq has become and that the US is hardly in a position to further extend itself militarily.  But the people in the Bush regime seem structurally incapable of learning from their screw-ups. So every day is a new day for these people.

One could also posit that Israel benefits by escalating the conflict with Hamas and Hezbollah because:

  1. The neocon Bush regime is highly sympathetic to Israel's wishes, and if Israel wants to 'take care of' Syria and Iran, it better do so soon, while the Bush regime still has total power due to a majority in Congress. Attack Syria, fully knowing that Iran will aid Syria by attacking Israel, then have the US come to Israel's rescue by taking out Iran.

  2. As a subset of 1), perhaps Israel feels that with the Bush regime in power it has as good a chance as it is ever going to get to manipulate the US into a war against Israel's enemies.

  3. This might be a highly oppurtune  time  for the US and/or Israel to take out Iran's alleged nuclear weapons program once and for all.  

  4. It is the fulfillment of some sort of Biblical prophecy (?)  

On the other hand, surely Israel must realize that even if Syria and Iran are defeated militarily, unless both countries are fully occuppied (something neither the US nor Israel are capable of doing) the result will be a perpetual and attriting  low-level conflict. Maybe Israel is willing to take that chance because it believes it can always count on the US to spend blood and treasure on its defense. Who knows.

I really don't see much to be gained by Iran in all this, except maybe to muddy the waters and give the US/Israel a taste of what they might be in store for if they go all out with Iran. Or maybe they are convinced US/Isreal is going to attack them anyway, so they might as well get the jump on them. However, they don't seem to have a really strong rational reason for starting such a war, but then again most wars do not have a fully rational reason. While this guy 'stringbeans' amandine-a-jad (my own phonetic version) appears to be moe than just a little bit strange, he does not hold full war-making powers and probably could not take the country to war without the approval of the high-ranking mullahs, who are supposedly far more cautious and conservative.  Again, who knows.

One thing that I am absolutely certain about is that the potential for miscalculation and unintendended consequences is vast, and that with oil resources thrown into the equations the situation could easily spin out of control.  And that is what really scares me.

Suddenly, it is August, 1914.

McCain was on Hardball supporting Israel, and putting it down as a "tactical decision" to bomb the civilian airport.  A "tactical decision" with which "he did not necessarily agree."

That "tactical decision" spin lost him any vote of mine.

"So every day is a new day for these people."

My God, it's "Groundhog Day" in Washington!  One of the funniest movies ever.

Everybody posting who says something like "we don't really know what is going on here" has been correct both in that assertion and in the various considerations they offer for further speculation. Those talking about Israeli victory are out of touch and are the fodder used in a push towards war.
My guess at this point: My guess not my prediction or conclusion: There has been speculation about war with Iran for over a year now. Israel wants war and there is a war party in the US. If the war party was not opposed and being attacked on various flanks we would be in a full scale war now. There is nothing but fear of being out on a limb all alione keeping Israel from hitting Iran right now. Frustrated by various voices of reason Israel attacked locally - something it can always get away with - and the propaganda drums making much of the Iran-Hizbollah link are beating at maximum. No coincidence this happens as the G8 meet and as Iraq hits total meltdown. We will know in days not months if Iran is to be attacked. A successful propaganda campaign may send Iran into war with fewer open allies than might have been the case even a week ago but no fundamentals have changed. In the event of war the Straits will be closed. AEGIS systems and other twaddle warmongers want to talk about won't mean squat. In one hour no more Gulf oil. USA and Israel will be hurt worst, whole world will suffer beyond fantasies of those who talk so blithely about various possible positive outcomes or the wondrous military prowess of Israel.
"Israel wants war . . ."

And your evidence to support this questionable premise?

Thank you for your thoughtful response.

They are throwing matches and lighting cigars in a room full of spilled gasoline and bombs with short fuses. Pacific actors don't do these things.
The obviously fake propaganda all over the media is thicker than I can recall seeing it. Turn on cable. Read a newspaper.
I have no idea what evidence you might accept. This is one where perceptions will vary. I tried to say in my original post I don't know anything for certain. I do think my line of reasoning is pretty obvious. All sorts of comments have been made, here and elsewhere, for over a year, about the desire o f the neocons, Israeli or US, to go war. Did that thought vanish?
Thank you for you clear admission that you have no evidence to support your position.

You have made yourself clear.

By that standard there is no evidence at all in this thread. If you don't like what I have to say that's not a problem.
All I'm even hoping for is a little clarity in what is quite unavoidably speculative.

I would think you might accept that what Israel is doing is extraordinarily dangerous, could lead to a larger conflict, and that they are willing to accept the larger conflict. Starting a new level of hostilities was their choice.

If you want to be snippy we can talk about evidence of the existence of certain 18th century French documents.

I think you were just stating the obvious in a very mild way.

So here we are.
Children in the sandlot,
fighting over the Gaza corner
and the Haifa corner and
the heights of Golan
 as the oil slowly dribbles out of the crust and into thickening air.

And when it's all run out, what will we have from all our feces flinging?
Just some oilless sand, dark skies and old blood oozing mindlessly into the sucked dry sand.

BTW, for a long time it was "obvious" that the world was flat.

I, however, can provide compelling and rather easy to understand evidence that it is approximately a sphere (because Aristotle did that about 2,400 years ago).

Do you consider evidence irrelevant to discussion?

To which documents do you refer?

The assignats?

The complete works of Voltaire and Diderot?

Do you think obscurity and obfuscation is clever?

Trying to be nice to you and make a reference few if any here would get. You know which.
And all sorts of refusals have been made here that the Arab Muslims are anything except peaceful, perfect little angelic victims.

Bullshit. Both sides have their faults but Hamas chose to escalate this followed by Hezbollah. And the evidence is very strong that Iran and Syria control those groups. For them to do something so radical would either (a) require direction from their controllers or (b) deliberately choose to break ranks with their controllers.

I think (a) is the more probable answer.

As to what Iran has to gain:

  1. Increasing unrest at home over economic problems can be masked by blaming the "Zionists".

  2. This acts to divert G8 attention from Iran's nuclear situation.

  3. This buys Iran more time to further their nuclear ambitions (peaceful, military, or both).

  4. This ties down an enemy (the US) with other actions (protecting Israel) making actual action against Iran less likely.

  5. This feeds the apocalyptic sect running Iran that expects the imminent return of the 12th iman amidst a global war.

  6. This also allows Iran to inflict damage on a hated enemy (Israel) while accomplishing these other goals.

So while people here can see all sorts of conspiratorial excuses to blame the US and Israel, can you honestly say with a straight face that you can see NO reason for Iran to do the same? Both sides in this are deceitful exploitive bastards. Yes the US and Israel have motivations but so do the Iranians (and Syrians). To assert otherwise is to reveal your biases.
You would never get an argument from me that both sides - or damn near every state actor - is other than a deceitful exploitive bastard.
That said the media evidence I've seen that Iran controls Hizbollah is, as far as I can tell, slim. They repeat endlessly (I counted five times on NPR in as many minutes) that Iran gives Hizbollah money. So what? If there was any presentable evidence of coordination or control they would lead with that. Lots of kindred spirits pass each other money. In every way I can figure Iran benefits by playing a waiting game. They've done well with it up until now. Repeating what I've said before in different ways, no one over there on any side appears to be acting entirely in rational self-interest. They're all more than a bit off. Just a dangerous situation.
And how coolly do we expect them to behave? American army on the western border, American army on the eastern border, constant American overflights, Special Forces on the ground aiding and abetting multiple disgruntled minorities - would you be cool in that situation? Would you make judgments that made sense to a wide audience of critical observers?
Isreal was offered a POW for prisoner exchange that was comparable (actually more acceptable than earlier exchanges, since they only had to free women & children) in exchange for their POW.

Such an exchange would have presented no obstacles for the upcoming referendum in Palestine on a MAJOR, fundamental step on the road to a lasting peace.

Instead they started a very wide range attack on gaza infrastructure.

It is difficult to ascribe motivations to another, but my reading of Machevelli leads me to wonder, but not conclude, that Isreal wants war.

I agree.  I think they planned the Gaza part, but I'm wondering if they wanted this action in Lebanon.  I'm starting to think they've been suckered - the IDF got their nose tweeked, and Israel acted predictably.  It seems like Hezbollah is rather well prepared.  It may not be too hard to goad them into Syria.  Iran has issued warnings not to go into Syria.  I don't know who's game this is, but it doesn't feel like it's US/Israel's right now.  Dangerous stuff.
3. ... make the Middle East a safer place for Israel by having the US help Israel destroy all of its enemies.

One could further "posit" that your "posit"-tronic brain has lost functionality of its logic circuits.

  1. Fact: Israel has atomic bombs and has the means to deliver them.
  2. Fact: If it was Israel's intent to "destroy all of its enemies" as your positronic brain posits, then Israel could have dropped the bombs on all these alleged enemies years ago ... but it did not (Double Fact)
  3. Fact: Rather than dropping the bomb on its alleged enemies, Israel has persistently pursued a pathway towards a negotiated peace. They negotiated a peace with Egypt. They were trying desparately to negotiate a peace with Arafat. It was Arafat who backed out at the eleventh hour. Think of him as the Runaway Bride of AllahLand.
  4. Fact: If Israel negotiates a peace with the Palestinians, then all the Petro-fascist regimes in the region will no longer have the I-P conflict to use as an escape clause excuse by which to fool the "Arab street" of their country into believing everything is the fault of "the Jews". They will have to answer for their own shortcomings. This is an unacceptable fact. Therefore they will do everything in their power to prevent a peace. And in "fact", this is exactly what they are doing through their HezEbolah puppets.

Posit on them apples for a while.
"Fact #2" would likely have lead to the economic ruin of Isreal, and thus threatened it's long term viability.

"Fact #4" is not a fact.

Fact #3: Palestine was about to have a national referundum on the legitimacy of Isreal, a truly major and fundamental step on the path to a lasting peace is passed.  Isreal was offered a prisoner exchange (women & children prisoners only) in exchange for their POW.  They rejected that offer and proceded to destroy much of Gaza infrastructure in an apparent attempt at collective punishment of the civilian population.
By freely electing Hamas, the Palestinean people have made it clear that they will not accept the existence of Israel.

I am puzzled by your failure to acknowledge this evidence.

The election of Hamas was, per reports (and seems quite reasonable) a vote against corruption and cronyism.

Hamas scheduled the vote (something Arafat never did) as Step 1 towards negotiations fro domestic reasons (using a popular mandate) and was a confidence building measure towards Isreal.

What other reason for the plebisite ?

And once voted upon favorably, it would be a sea change within the Palestian community.

As it took Nixon to recognize China, Hamas may well have been the best party to make peace with Isreal.  If Isreal wants peace on anything but their dictated terms.

Israel as a Jewish state has no future.
I recall hearing that back in 1947.
Just got my secret Nazi decoder ring this morning.
Let's see if this works.
OK. Enter: "Let input= "Jewish state has no future.""
Enter "Print (translation)"
Press Execute All.
Here it is:
Output= Yudan Achtung. Take off clothes and march like lambs into showers. Das vorld haz room only for arayans and ayrabzoombrotherhood. Gottsadung.

Hey this is great. I think I understand where you are coming from.

You're just being a clown.
Zionism is Judeophobia for Jews.
You might want to remove that swastika from your forehead.
Sorry, but I think this was inappropriate.  It is not possible to be critical of Israel without being a supporter of death camps?  Putting up picture of concentration camps is just a way to force the discussion to an end.  In my mind the wrongs that were done to the Jews in the past do not excuse bad behavior by the state of Israel (a political entity) now.  Especially considering that modern Zionism was a secular movement from Europe begun in the 1800's.

I also don't believe that Israel will succeed in the long run in their present format.  I find their actions in regard to the Palestinians to be reprehensible.  Please explain why that makes me anit-semetic, or how the German death camps are relevant?

I agree Twilight, hence my criticism of Israel. But when I see people using the word "Zionism" and the word "occupation", I know exactly what agenda they are hiding under those terms. You can be a critic of Israel but many critics of Israel are critics because they are bigots. Those that are bigots deserve to be called on it.
Your crystal is deceiving you. I have great respect for Jews, none at all for zionists.
Z-word again?
You have obssessive compulsive infatuation with the Z-word.
Toss the Z-word into the cage and watch the sensitive monkeys jump and shriek.
Oh what good clean fun.
And as for ... cough, cough... the Peak Oil problem?
Who needs to think on that anymore?
Z is the word, is the fun.
Who is our favorite circus clown?

Let me throw another few words into your circus ring:
ehtnic cleanser
Islamo facist antisemetic code word croaking cockaroach pig

If the shoes fit ....
Well yes they do
Look at the picture
Look at you

Hello Twilight, my young friend (*),
I've come to reason with you again,
Because of a coded message softly creeping,
Left its seeds of hate while you'ze asleeping,
And the vision that was planted in your brain
Still remains
With its sounds of hatred.

In restless dreams it stalks you out,
Narrow streets of Aushwitz block,
neath the halo of a tattoo stamp,
It turns your collar to the cold and damp
And your eyes will be stabbed by the flash of
A neon light
That splits the night
And proclaims that "Work makes Freedom".

So what's wrong with that?
Learn to read the coded words my friend.
"Israel as a Jewish state has no future."
"Twilight as a human entity has no future."

These are not "criticisms".
These are coded words of hatred.

Work makes Freedom --that's another code.
What do you think it means?
Here's a hint:

All I'm hearing from you is zealotry.  The refusal to abide any criticism of Israel, and an all out attack on those who dare to.  I find the actions of the STATE to be unacceptable, and no amount of past wrongs that have been done to the ethnic group that set it up serve to justify that.

If someone says "Twilight as a human entity has no future." and tells me that is because they are going to kill me, then of course I should be concerned.  On the other hand, if they can argure that this is true becuaswe of actions I am taking now, then it is constructive criticism.  If someone says that those who have not learned to produce their own food have no future (I'm in that group), I do not assume that is a threat.  Apparently you would assume that meant they were going to kill me.

You seem to believe you can tell what is in the mind of the person who wrote that - I don't think you have that ability, and are just projecting your own fears.

There is the potential to do horible things within all of us.  Having been a victim in the past does not make you immune, nor excuse bad actions in the future.  Those who live by the sword will never be safe unless they can completely vanquish their foes (like was done to the Native Americans).  Israel has not achived this, and is not likely to, and so they live in a constant state of war and will not thrive (as they have not).  In order to change that will require major changes and sacifices - the present format cannot work.  This does not imply any ill will on my part toward Jews, no matter how much you shout it.  

I see comments by the survivalists about the arsenals of guns, and I hear people wondering "why do they (arabs) hate us?".  I'm done with this now, I will not respond to this thread anymore.

The last paragraph should have read:

I see comments by the survivalists about the arsenals of guns, and I hear people wondering "why do they (arabs) hate us?".  The problem is that safety does not come from weapons, it comes from being a valuable part of the community.  If the US had spent the amount we did on the Iraq war on making the lives of people in the ME better in real terms, we would be much safer now.  I'm done with this now, I will not respond to this thread anymore.

The refusal to abide any criticism of Israel, and an all out attack on those who dare to.  I find the actions of the STATE to be unacceptable, and no amount of past wrongs that have been done to the ethnic group that set it up serve to justify that.

... I will not respond to this thread anymore.


Therefore, as between you & me, I get the last word here.

By no stretch of the imagination, is your charge that I won't abide to "any" criticism of Israel true.

If you feel that the current "actions" of Israel are overblown, disproportionate, not-turning-the-other-cheek enough; well then fine. And if "you" want to say so here on this web site that's OK by me. Go ahead and do so Twilight.

But "you" didn't say it. You didn't go spouting the z-word in a hateful manner.

Someone else did. Someone who belongs to a certain group of skin-headed Islamo-facist racists who pop into this web site from time to time to sprinkle their coded hate speech into the discussions. That is not acceptable.

If you think their coded words are "criticism", then you are  naive and unsophisticated about the ways of these kind of people.

Of course I am "projecting" meaning into their vague coded words. I know who they are. If they say, "work produces freedom"; say what you want, but I know exactly what they mean. And I'm going to keep shining the spotlight of truth on these cockroaches.

If you Twilight, choose to keep it in the dark, to be another Neville Chamberlain and you want to keep chanting about "peace in our times", that's OK too. Just realize the shadows of history do not lean towards your way of thinking.

A number of other people at this web site have already noticed the tattooed swastika shining just a bit too brightly from the skinhead of our Z-word spouter. You have not figured it out yet. Thats all.

Well, I'm in a crabby mood tonight, so I'll reply anyway.  Your condescending tone is irritating - I don't need a scolding from you, as if I were some silly child.  

Zionist should not be offensive, as Zionism was a real secular political movement that resulted in the state of Israel.  I suppose it must offend you because it implies that Israel is somehow not as legitimate.

The "shadows of history" live in all of our hearts.  They are what made Europeans give smallpox tainted blankets to the Native Americans and force African blacks into slavery.  They made American snipers shoot ambulances in Falluja, Israeli soldiers shoot holes in the heads of Palestinian children, and Palestinian suicide bombers blow themselves up in restaurants full of people.  It's called hatred, and we are all capable of it - Jew, Arab, European, Asian, and that guy down the street.

As far as I can tell the original part of this thread was about shining that "spotlight of truth" on some of those "cockroaches" in Israel - they are most certainly there too.  And in the ME, it is Israel that are the powerful ones.  They have the might, they have the force, and thus it is appropriate that the "spotlight of truth" shine the most often there.  You see that as a signal of racism, and since such things are real, it may be in some cases.  But I think that's caused you to put your head in the sand regarding the virtue of the actions of the state of Israel.

It is not just that I feel their current actions are "overblown, disproportionate, not-turning-the-other-cheek enough"; I find their whole attitude toward the Palestinians to be offensive and amoral.  Are there Arabs who are racist?  Of course - but I see the same attitude in reverse too.  

I find your use of the term "Islamo-fascist" offensive as hell.  Kinda roles right off the tongue, doesn't it?  It oughta, it gets an awful lot of use all over the world's press.  It is a RACIST term, no different or less offensive than Judeo-fascist would be.  So you can shine that "spotlight of truth" at me, I'm sure there must be a few things for it to find - but when you are done, point it in the mirror, and try to keep your eyes open.  

Lastly, I know how to post pictures too.  The concentration camps were not the last "shadow of history", and there are plenty of images of offenses from the ME conflicts to prove that - enough to make us all puke.

Zionism was a real secular political movement that resulted in the state of Israel.

You win the prize for telling a truth.
Zionism "was" --past tense.
There are no Zionists now because the State of Israel was established, legitimately, by proclamation of the UN and it was recognized as a legitimate government by essentially all the countries of the world over 50 years ago. (Guess which country was the first to recognize Israel.)

So when your skinhead friends use the z-word here, they are engaging in a preversion of history and in denial of a fete accompli. Israel has been established. It is a legitimate government. It is a Democracy. It is under attack by those who want to destroy it. And if you want to criticize it, go ahead.

Also, if you want to publish pictures here of Hezbollah terrorists accepting long range missiles from their "unpowerful" friends (you know, the ones that do have oil under their sands and do use oil money to finance terrorism --all over the world, not just against the "zionist pigs" but also against the unbeliever Americans, Europeans and Indians) and you want to put up pictures of these devout religious ones firing the missiles into civilian population areas in Israel, or preparing to suicide bomb innocent Jewish women and children in their homeland; well please, go ahead. I'm sure we will all learn about human nature from such current event pictures.

(Click on each picture to learn more about your Hezbollian friends)


Step Back and Twilight break it off. I just hate to see people I know and love fighting. Do this for me. Bring it back another day. I think we agree more with each other more than we like to argue. So let's stop.

Plus - in the past you guys have pretty much always backed each other up. I can prove this. The fight is elsewhere. Truce...

Oil CEO,
Thank you for brokering a truce.
TOD Peace Prize goes to you.
The world needs peace makers.
A JPEG is worth 10,000 words.
Good Ones. I was going to make jokes. But it is not time for that. Let the images speak for themselves.
My "Hezbollian friends"?  Please.  It's disappointing you resort to such tactics, as you have no grounds to support that accusation.  You cannot help but post more pictures of the obvious hatred on one side, and then you assign me to that side because you cannot imagine someone NOT being on a side - because you are a partisan.  When it gets down to demonization, it's obvious that this is pointless.  

But it's a new morning, and time to get back to oil my friend.  This would appear to be a topic we should avoid.

You get an A+ for realizing you were being played.
We humans are irrational, emotional beings. All of us.

I was thinking on what this might have to do with oil, if at all.

Upon "stepping back" to view the bigger picture, I conclude that it shows us what happens at the borders of failed/collapsed and collapsing civilizations.

Palestine (Gaza & West Bank) is a collapsed civilization --overpopulated, no resources and now cut off from the last economic friend they had: Israel. Yes, many Palestinians had jobs in Israel which is why they crossed through those checkpoints every day. Also, injured or sick Palestinians sought medical help in Israeli hospitals. With the wall up and checkpoints closed, the Palestinians are at their last straw. What should they do? Maybe for many, war is the only answer left. (But why against only Israel when Jordan is so conveniently adjacent to the East of the West Bank? Answer: --because they had alread gone to war with Jordan, and lost.)

Lebanon is also a collapsed civilization --never fully recovered from the previous civil war, although its tourism business has been making a come back. Lebanon is controlled as a puppet satellite state by Syria and therefore Lebanon is not a civilization that stands on its own two feet.

Israel is a civilization that is collapsing under the weight of the collapsed states around it. Because the surrounding states switch into war stands as they collapse, Israel must maintain a costly defense system which drains its own economy. Israel also relies on an external state to keep itself propped up: the USA.

The United Sates of America is .... a state which is sort of a combination of Israel and Palestine mixed into one. The USA is not quite out of resources yet, but is heading that way in terms of oil, gas and agriculture. The USA is weighed down by a failed state to the South as well as a collapsing Empire overseas. The USA must maintain a costly defense system which drains its economy.

Not a pretty picture and therefore it may get us angry to hear this.

But then again, there is always that river in Egypt.

Hamas is mainly know as a terrorist organisation, but an important part of its activities concerns humanitarian services.
whatever that means. No offense, but we all know this. Have you dissected the significance of your statement yet? Porn Stars are amazingly beautiful, but they only let people stick things into them who have amazing amounts of money. Or some other scam. It's always a trick. The manipulative feasting on the naive. Have you noticed that? Would wanting it some other way screw up your chances? That's always the question. Do you really want this to be another world?

Again - Vague!

Did you mean the most important parts of its activities we're humanitarian, - or services, - or neither.


South Lebanon. Yeah, Right. HEZBOLLAHSTAN.

Hmmm...he may in fact be a stalwart neocon, but the idea that Iran could be behind all this isn't out of the realm of possibility.  There is too little info to know right now, but we will know within a few short years.
It's interesting to think that Iran could be so cunning to work the small pawns in such a way.

I would say Iran may be working the pawns, but who has their hand on Iran, the knight?  

This goes back to Russia being the master chess players.

I think they have played Iran and China most effectively for their own purposes.

Kansas City makes prepayment at gas pumps mandatory

Kansas City -- City officials hope a new ordinance requiring prepayment at gas stations will reduce drive-offs -- and drive down police costs.

"It's a 100 percent preventable crime, and we're spending a lot of public resources (to combat it)," said Councilwoman Deb Hermann, who sponsored the ordinance.

It passed on a 9-0 vote Thursday, with no discussion, and takes effect in 10 days.

That's occasionally been talked about in my area too. It's easy to see why. On the other hand, I can't really summon up much enthusiasm for restricting businesses and consumers merely for the convenience, and a rather trivial convenience at that, of the police. That just seems the wrong way round.

The credit card companies will love it, because it further penalizes the use of cash. Unless they are very good at estimating in the face of constantly changing gas prices and non-quantitative gas gauges, cash users will need to wait twice at the cash-register line, once to prepay, and then again to get change or maybe to pay again to top it up, instead of just once. Homeland Security will also love it, since it will yield a mountain of new records for them to troll.

Gas station owners won't love it, because the credit card companies charge a humungous amount, IIRC often 5% plus possibly a flat fee.

I think gas station owners will like it.  They're reluctant to require "pay before you pump," because it annoys honest customers as well as dishonest ones.  I know I quit buying gas at one station that started requiring it.  Too much of a pain.

However, if they all require it, it's not an issue.  

Gas stations that let you pay at the pump will have an advantage, but they had an advantage, anyway.

Pay-at-the-pump dispensers are almost universal in my area. It would be just a small step to make their use mandatory. IMO it's more convenient to use them than to go inside and pay with a card or cash.
I can't really summon up much enthusiasm for restricting businesses and consumers merely for the convenience, and a rather trivial convenience at that, of the police.

So banks shouldn't have to install vaults, ATMs shouldn't require PINs and we should take locks off of all cars and houses.  If something is stolen just call the cops and let them deal with it.

Personally I would rather have our police force tracking down and our courts punishing real criminals, not petty theft (about $60 for a 20 gallon fill).  Even with pictures and license plates, what does it cost to cite and punish the guy who drives off?  Yes, there are fines, but if it was overall profitable for the police force they wouldn't be going to the city council asking for help.

Not to mention businesses hate this.  They lose money on the gas, the transaction, and the person who doesn't come in and buy something.  Wah Wah.
Don't worry, they're adjusting.  New gas pumps sell you sandwiches, carwashes, soda, etc., right at the pump.  Place your order, pay at the pump, and it will be ready by the time your gas tank is full.
Long time lurker, first post. I have been following the price futures for some time--my question is: when does the August 2006 contract expire? Is there a regular date for the advancement to the next month? Thanks.
If I'm not mistaken the contracts expire on the third Friday of the month.  If this is not a trading day then it is the last trading day before the third Friday.
Thanks. I am a little surprised that there is such a small differential in price between August and Sept. I guess the market has not put much concern into the peak of the hurricane season (i.e. replay of Katrina and Rita), since things have been quiet so far.  
Usually the 20th or 21st day of the month, so next week you get the turn over.
Another major Scenarios version just uploaded to our Website for ASPO-5:

July 14th, 2006 - With ASPO-5 in Italy only days away, we have above added Outlook updates for CERA, OPEC, a last minute ASPO revision and introduction of a guest modeler, Chris Skrebowski, whose Megaprojects model has gained him notoriety recently for his bottom up field analysis of flow rates and depletion ... similar methodology to ASPO, CERA & Koppelaar.  Colin Campbell of ASPO has raised the remaining reserves component of his URR by 30-Gb and boosted peak production to 89-mbd.  The CERA model is amended dramatically to reflect figures given in Robert Esser's testimony at USA Gov't Hearings into Peak Oil Theory in December where CERA re-stated their estimate of potential global production at only 108-mbd.  In its Long Term Strategy model, OPEC has dampened its forecast peak to 106-mbd.

Chris Skrebowski, editor of the UK Energy Institute's Petroleum Review, foresees increasingly more aggressive net depletion rates compared to other modelers with the difference that his plateau resides at the 60-mbd region as opposed to the more common concept of a peak plateau.  Due to his skepticism of current URR figures, we have arbitrarily attributed the average (2.227-Tb) of the three lowest URR estimates to his model.  The avg of all the URR estimates, which is usually attributed to those Outlooks that lack URR figures is presently 2.992-Tb.

Please note that y-axis minimum is amended to 10-mbd from zero.

They ALL look optimistic compared to what's happening at the moment and prognostications that we are already at plateau.  Will we really see another 4.5 mb/day output rise?  Do these figures take account of problems in Nigeria and Iraq or are they just theoretical maximum outputs?
The plateau talk or navel gazing at TOD is completely w/o merit.  The bottom three modelers (Skrebowski/Campbell/Laherrere) have all raised their Peak targets in pre-ASPO5 submissions.  Koppelaar also does bottom up analysis and we expect his 2006 Update later in the Summer.

Let's be honest folks, many of you "just can't handle the truth".  These four diligent gentlemen had a thankless task and represent YOUR camp.  And now many disown them 'cuz the message goes against preconceived notions...

But it is a merging.  the top are coming down faster than the bottom is rising.  See comparative graphs in our archive:  http://trendlines.ca/economic.htm

I began this project exactly 24-months ago.  We are elated with the reprecussions.

The plateau talk or navel gazing at TOD is completely w/o merit

That doesn't seem very nice to people that let you post at their site. I think if you has some point of data in a given graph that you thought was incorrect, point it out and discuss it.  A blanket statement like shows a lack of attention to detail.  If you want to be taken seriously discuss it in a serious way.
There is nothing optimistic about Chris' curve - a bit higher peak, but then a vicious slope and less oil under the curve than anybody else.
From 1975 to 2006 we saw a roughly 33% rise in global production when discovery rates were far higher than now. And yet you expect us to take seriously forecasts which claim we will see another 25% increase over where we are now in 15-25 years?

Yes I do notice the tops are coming down fast. Very fast. Let's see what they predict in 2007 and 2008, Freddy.

On a bright note:

HOUSTON (AFX) - The number of rigs actively exploring for oil and natural gas in the United States this week rose by nine to 1,668.
Of the rigs running nationwide, 1,368 were exploring for gas and 296 for oil, Houston-based Baker Hughes Inc. reported Friday. Four were listed as miscellaneous.
A year ago, the rig count was 1,404.

But i thought several rigs were going to pack up and go somewhere else with Saudi money? When is that suppose to happen? Anyone know? or have a WAG?

A question for all brilliant minds out here ( and there are many I note)
If all of the price increase is being driven by fear then why is every contract right up till 2012 going up in unison. Surely they do not think this war will last until then?
Why not?
Fireangle has asked the the question de jour. And I will respond to you, Don, in anwering that question.

Now, the classic Econ 101 answer is that everybody is a rational actor and will promote their own self-interest at all times. Yet the current market price (August) and the futures prices (September and beyond) are based on uncertainty due to fear in the markets. Rationality and fear? Do these words go together? From Bloomberg today

Nervous Traders

``The high level of violence a few hundred miles from the oil fields makes traders nervous,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``I don't think this is spreading but every possibility has to be accounted for. If things don't spread, it will take a few days or weeks before prices fall.''

... ``What was a conflict between Hamas and Israel has now expanded to Lebanon and Hezbollah,'' Beutel said. ``This now threatens to spread to Syria and Iran, which would be a major threat to oil shipments.''

Yes, let's consider every possibility. A big asteroid crossing Earth's orbit around the Sun could hit tomorrow. That makes me nervous, so I'll raise prices. Call me paranoid? Well, if you must! My margins are X but the price could be an order of magnitude higher next week. If I want to stay in business, I better raise prices by that much now so I can cover the costs! Ah, you say, the probability of an asteroid hitting the Earth is much lower than that of there being a general conflagration in the Middle East directly affecting oil supply tomorrow. So, everybody is being a rational actor now. But really, do I know the probability of either one with any certitude? No, I do not. But what I do know is that I'm fearful and nervous.

So much for Econ 101.

I thought you were talking about the futures market.  You talk as if the individual players are sitting around setting prices. Now I want that  job.  These traders are placing bid prices  for oil and placing asking prices for oil.  This is based upon their perception of future prices and those factors  affecting those prices.  Fear is just another factor they are taking into account that affects their bidding and asking behavior.

But really. No individual trader needs to actually be in a state of fear. He/she just has to believe that the market will react to an event like a current war or a future war.  I don't see how assigning a certain probability to war is any different that assigning a certain probability to a drowth or any other phenomenon that affects the price of food or oil.

Ultimately, though, it still has to do with supply and demand or a projection of what supply and demand will do.

To play this game is difficult under the best of circumstances for the most knowledgeable trader. Anyone who chooses not to try to maximize profits in this game will not last long in the game.


You asked, "Rationality and fear? Do these words go together?"

Short answer. Absolutely.  I fear there is a truck headed directly in my path which will kill me. My rational response is to get out of the weay.

Your instinctive response is to get out of the way. Fear is an instinct finely honed by nature due to evolution in the face of some danger. Biology is a huge part of reality. Modern economics was the product of human thinking in the last 500 years. Which, in geological time, is nothing at all.

I try to teach but others must be willing to learn.

By the way, I bolded the wrong part of the text. I'll try again.

Nervous Traders

``The high level of violence a few hundred miles from the oil fields makes traders nervous,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``I don't think this is spreading but every possibility has to be accounted for. If things don't spread, it will take a few days or weeks before prices fall.''

... ``What was a conflict between Hamas and Israel has now expanded to Lebanon and Hezbollah,'' Beutel said. ``This now threatens to spread to Syria and Iran, which would be a major threat to oil shipments.''

Prices go up immediately and we'll gouge you for a few days or weeks if the worst doesn't come to pass. And by the way, "fear = anxiety ridden expectations" and these never stop, as I noted above.

Do you believe in Progress?

Please study my book.

You have demonstrated no understanding of basic economics whatsoever.

Common sense beats economists' dogma any day.
"Common sense" says that the earth is flat, that witchcraft causes TB, and that women are stupider than men.

There is no conflict between what makes sense and sound economics. Indeed, a solid study of economics can help much in making sense out of the real world.

That sort of attitude to economists' dogma is what got us the Irish famine and many Indian famines.
To the best of my knowledge, no society where there has been legitimate representative government (a.k.a. "democracy") has ever had a famine. Hunger yes, famine, no.

Governments create famines, e.g. in Ukraine in 1930s or China in 1940s (which was probably the worst famine in history--crated by the Japanese invaders).

Sounds like you are claiming there was no famine in Ireland and India.  After all the British government was "representative".  I suppose you also think that the treatment  of aboriginal people at the hands of the US "democracy" was legitimate.
Please indicate by year and province where India has had a famine since 1948. India was a COLONY of Britain. Ireland was a COLONY of England until rather recently in terms of history.

By no stretch of language can colonial masters be regarded as legitimate representative government.

Famines (e.g. N. Korea today, Darfur today, Eithiopia, etc.) are government created and government perpetuated. Without exception, so far as I am aware of.

Hello dissident,

As Don pointed out, there has not been any famine in India after Indpendence in 1947. Agreed, there is large-scale poverty, but there has been no famine.

To appreciate what democracy (however flawed the implementation of it be) can do to prevent such disasters, please read "Development as Freedom" by Amartya Sen
Is democracy always in one of two states, present or absent? No other alternative?
What was it Keynes said about 'animal spirits'?
Keynes said "animal spirits" were the key to investment.

Without positive "animal spirits," no capital accumulation.

With postive (favorable) "animal spirits" investment and hence economic growth.

As usual, J.M.K. was right.

:-) Psychology is pretty key to understanding the 'rational expectations' game.
Let me nitpick, Dave. You said we don't know the probability. I disagree. That's exactly what probabilities are - an estimate of the odds of something happening. What we don't know is the actual future and we can't know that til it arrives, which takes us right back to probabilities, which are best guess odds of something occurring.

So I think we do have probabilities. A better question might be to ask about the quality of our probability estimates. And in this case, the actors (the market) have demonstrated a piss poor record of seeing their best guesses actually play out, beyond about 6 months. So I think it's wise to question the quality of the probabilities given, but I don't think you can question probabilities per se, since they are exactly what we use to guess at the future.

Personally, I was being sarcastic when I noted the "fear premium" which has been around for years (every since the term evildoers has been used) and looks like it will be here permanently.
On a diferent note the USDA Dept of Ag. just issued a report entitled "The Economic Feasibility of Ethanol Production from Sugar in the United States" While it does not approach the issue from an EROI standpoint it is devastatingly negative in it's conclusions. Rep Abrecrombie from Hawaii has already denounced the findings as it puts data directly in the way of his attempts at greater sugar subsidies.It was sent to me so i don't have the URL.
Sandia Labs proposes energy surety model
by Michael Millikin

With concerns that energy use will rapidly increase over the next several years while fossil fuels diminish as well as numerous other energy uncertainties including the results of climate change, Sandia National Laboratories is proposing applying the principles of surety to energy.

Energy surety takes an integrated approach to achieving safety, security, reliability, recoverability and sustainability objectives for the nation's civilian and military energy systems. Patterned after Sandia's many decades of applying surety principles to weapon systems, the approach includes choosing the best mix of fuels and applying conservation principles to all steps, starting with energy production and ending with final use, even using what would normally be characterized as waste heat and mass.


And some people say it's 'America Bashing' when we cast doubt on America's penchant for military spending:

While some people have been working towards investigating scientific solutions, some others, such as Lieutenant Commander Joey Dodgen, have been thinking of other options. In his award winner paper at the Joint Forces Staff College, called "Imperialism 21: Hedging and Abandoning History" he made the following claims:

"As far-fetched as it sounds, the advantages captured through colonial or imperial ventures would be numerous, including, but certainly not limited to, resource control and forward military basing...Economic imperialism is crucial to securing resources, maintaining favorable trade, and calming America's business market amidst the daily turmoil of global terrorism. Economic imperialism is of no less importance to the United States than military imperialism."

Americans need to realize that there are forces at work in our country pushing us down this road.

Americans need to realize that there are forces at work in our country pushing us down this road.

My friend, US is already very far down the road of economic  imperialism (usually called in the media "free trade", "democracy" and such). The military power has also always been behind it (some 10 wars in 60 years, not enough?) and it's role has been to enforce the economic imperialism, when the other options have not worked.

I count six. what four am I missing? (WWI, WWII, Korea, Vietnam, Desert Storm, Iraqi Liberation).
How many is an interesting question. First you have to decide what is a "war" and what is a "conflict" or other form of military action. Take a Look here
Well it really depends what you define as a war. I was discounting WWII as it could hardly be called a imperialistic war and included some military interventions which you may decide not to call wars:
  1. Korea
  2. Vietnam
  3. The intervention in Iran and the subsequent support of US yo Iraq in Iran-Iraq war
  4. Grenada
  5. Panama
  6. Desert Storm I
  7. Interventions in Bosnia and Kosovo
  8. Afghanistan
  9. Desert Storm II
  10. Iran II to come??

The list in fact is longer if you include so called "proxy wars" of US against USSR (in Iran, Afghanistan etc.), its direct support to some coups (Iran, Iraq, Chili, Nicaragua, Venezuella, Puerto Rico etc.) and some smaller scale interventions (listed on the site step back provided, thanks step back).
This is freaking priceless. Here is a recent interview with ethanol skeptic Tad Patzek:

My In-depth Interview with Tad Patzek

He doesn't think too much of the celebrity ethanol endorsements:

KI: Based on your research alongside Mr. Pimentel, if true, that ethanol from corn takes more energy to produce than it delivers, why are major figures such as Vinod Khosla, Richard Branson, Robert Redford and President Bush still strong advocates for ethanol?

TP: Mr. Vinod Koshla and company are rather ignorant men, who also happen to be famous for other reasons. For some reason they seem to have an urge to talk about things they know so little about. Would you like Mr. Vinod Khosla to perform a brain surgery on you because you like him so much, or would you rather have a qualified person do it, while Mr. Koshla runs down his Sun Microsystems all the way to the ground?

He also echoes my position on Brazil in the interview, as well as the position I have taken on ethanol stocks:

KI: What is your prediction on the future of "ethanol stocks" as they have been losing steam since their "bubble" like run?

TP: The ethanol stocks will collapse, unless the ethanol lobby, can keep the massive subsidies flowing. Even worse, the existing ethanol plants will be useless for other much more efficient processes, such as Fischer-Tropsch.