I'm diggin' this forum more and more. The rusty gears are creaking into motion. Facts are beginning to be dusted off and presented. Haven't heard from some of the earlier posters and you know why we haven't ? I think some of them have had to confront some earlier misconceptions and are busy studying up. That's a good thing. I know I've been forced to bone up a little on biodiesel.
Bring on the opinions brothers and sisters and invite some facts along for the ride.
Yes, I did read one of the links. Very interesting. Hopefully in near future it will be possible to make the process more efficient and with more volume.
Catch is most of our vehicles burn gasoline, not diesel. Part of what's held diesel back has been USA fuel sulfer content (supposedly to be drastically reduced in 2006) which makes it impossible to use affordable pollution equipment to keep diesel engines "clean" . Biodiesel may make this much easier to achieve.
A large number of car companies, especially the Euro, have powerful, efficient diesels begging to come to the USA once we get our diesel fuel act together.
Meanwhile it's amazing how disfunctional the USA is on this issue. The image most car magazines and many responses I see on these forums suggest: We want cheap gas, but won't allow the needed refinery capacity to be built in "our" back yards (so where do the new refineries go? - middle of the ocean, empty desert, underground?). We want fast interstates to drive on, but won't cough up gas tax or other monies to get our rotting, overloaded network rebuilt. We say "lets save fuel", but what's really popular to buy? - cars with the largest horsepower engines possible. Go figure.
Since I just purchased a used 4 cylinder automatic 2003 Accord, I have no idea what kind of fuel mileage I can expect. My primary vehicle is a 2002 Ford Mustang / 8 cylinder / 5 speed manual, and to be honest, I never check the fuel mileage. It is what it is! Assuming that the Accord would get 30 mpg on the highway, and I put somewhere around 15,000 miles per year on the vehicle, that would work out to about 500 gallons of fuel at $3.00 per gallon, which would be $1500.00 per year. That is not all that bad. How about the people who own boats. On those vehicles you would get about one mile per gallon. A days outing on the water, with a 100 gallon fuel tank, could set the owner back $300.00. There are roughly 20 weekends from May to September, so at $300.00 per weekend times 20 weekends, that would give the owner a fuel bill of $6000.00. This brings new meaning to the idea of "dock parties". You can purchase a lot of food and refreshments for that kind of money. On the car side of the issue, 30 mpg at $3.00 or $5.00 per gallon is not that bad, when you consider the convenience of traveling in your own vehicle. I guess, in the future, our friends will have to kick-in for the fuel if they want to go riding late at night on twisting mountain roads, open highways or cruising on the water. Best regards. -----Dwayne
How about the people who own boats. On those vehicles you would get about one mile per gallon. A days outing on the water, with a 100 gallon fuel tank, could set the owner back $300.00.
yes...I heard...
there is one guy who has a V8 motorboat on the delta..and they sometimes motor into San Francisco to have lunch....says it costs him about $700 for the trip in gas alone......
I would not pretend to be as knowledgable on this subject as you are. Everything I have read leads me to believe that biodiesel is better for the environment than using fossil fuel. My understanding is that biodiesel has little or no sulfur content. It creates about 10% more NOx than conventional diesel and is CO2 (GHG) neutral. As far as adding to farm land that would be a reality if biodiesel were to try and replace fossil fuel. I don't see that happening in our lifetime. I think of it more as a hedge against the folks that control most of the oil reserves.
Remember just a few short years ago when the last disaster was about to strike? Remember Y2K? For those that don't remember, Y2K was a computer programming glitch that threatened to throw the entire globe into darkness. At first no one thought much of it. But as time went on more and more scientists and computer experts and general geeks began to believe that there might be something to this old Y2K thing.
The theory at the time was that the programming glitch would manifest itself as computer date functions rolled from 1999 to 2000. In short computers wouldn't recognize the 00 of the new millenium and wouldn't be able to contine to function. So what people said. I haven't used my computer in a week who cares. I'll know what day it is. I'll know if I'm hungry too and if I am I'll walk down to the store and get something to eat.
What the doubters were failing to see was that the developed world had become so interconnected because of computers that every little movement we have become accustomed to was scheduled by millions of computers humming away quietly in the background. The guy that hadn't used his computer in a week forgot (or didn't know) that the store that sells the food he's going to go get does use computers. And if the stores computers were unable to talk to the distributers computers the distributers computers would not know to send him stocks for the shelves. Big deal the guy went on the store picks up the phone and calls the distributer. Wellll, he can't because the phone company also uses computers and you can't get a call through. "All right", he finally says in desparation, I'll get in my car myself and drive over to the distributer." Uh...that won't be possible either. The traffic lights work on computers too. Since they weren't working there have been a lot of accidents at intersections. Traffic is at a stand still.
Anyhoo that was then and this is now. And besides we dodged that bullet. And dodge it we did. But here is the difference. The date of the Y2K event was known. Midnight, 1999. So once people took it seriously the IT folks worked their asses off. And we spent a little money along the way as well. Anybody care to take a guess whatt Y2K remediation ended up costing? Would you believe two trillion dollars? Two trillion. That was more money than it took to fight WWII.
Why have I taken this trip down memory lane? Well once again if you believe in the possibility of peak oil we have a fairly serious event we are going to have to face. But this one has an elusive time connected to it. Some say that the event already happened. (Remember when it happened in the US in 1970 it wasn't confirmed until several years went by and it could be determined that production was on a downward slide) Other people say its 10 or 20 or 30 years away. With so many parties disagreeing on when this will occur the urgency of providing some alternatives gets lost in the shuffle.
Think about this. A lot of people keep saying that we will just shift to alternative energies and go about our way. We'll build nuclear, shift to coal gassification, biodiesel, solar, etc. Trouble is to do those things you need two things, power and time. When we went from horses to cars the transition was fairly smooth because horses weren't being depleted. But as we move from oil to x we need the power of oil to take us there. If I'm going to build solar panels and deliver them to market I need oil to do so. If I'm going to build nuclear plants I need the power of oil and time. (This is the one that I want to make certain they have enough time to get it right.)
If, as some believe, that the Saudi Ghawar fields (the motherlode of all oil motherlodes) have already experienced peak oil and that ends up being proven in a year or so will we be far enough down the road to alternative solutions to make a smooth transition? That my friends is the sixty-four thousand dollar question. What is a rocky transition you may ask? I'll leave that to the science fiction writers because personally, I don't want to spend too much time thinking about that.
We'll build nuclear, shift to coal gassification, biodiesel, solar, etc. Trouble is to do those things you need two things, power and time.
me: If we didn't spend 10 years on environmental studies and the effect on the carpenter ant population of every state, I believe the actual construction time of a coal gasification plant would be in the 3 year timeframe. During that time the heavy mining cranes, conveyors and trucks could also be built. It would be a good shot in the arm for American industry which has excess capacity such as GM, Ford, Boeing, those military bases and shipyards, that have heavy industrial experience.
Coal gasification would then provide all the oil we want at about an $80/barrel cost. I use 2 industrial events in history as examples of the human will to get things done: the relocation of most of Russian industry (moving 1000 miles east) during WWII, and the repair of the carrier Yorktown in 24 hr after nearly being sunk at the Coral Sea, and joining the battle at Midway.
You should send that note to the U.N. and have them put it in many hundreds of languages, as I don't think the few of us are going to change things much. And I don't think that's going to have much of an impact on people such as in Nigeria who hack a hole in a pipeline, risking incineration, to steal a bucket of gasoline.
I also don't think your message isn't going to play well with people who want to own and drive a car once in their lives. They're not going to be motivated not to drive, so that you can continue to drive 5K, 10K or 15K? miles/year.
First off, thank you for everyone responding. It's good to see that this has created some dialogue. As for biodiesel being bad or good for the future is a toss up. I don't propose it is the only answer but possibly and quite probably a valid energy source until we can understand how better to conserve and, reduce our unbelievable energy appetites and re-use the resources. I am amazed that everyone seems to be an expert. I however make no assertions. I'm just a regular guy who is looking at possible energy sources for the future.
Brightness4, your opinion is of course most welcomed but I'm glad it is an opinion only. Yes, farming is an energy intensive process, but you failed to research or quote several studies that promote "high yield crops" such as those curently being tested in Africa and India. This could possibly become the second "green revolution". This type of farming could literally change the American farmer outlook and make them once again a great American institution. Your comments regarding fertilizers are correct but again, crude distillate refining for these necessary items would be reduced by future use of BD. Genetic technology and use with pest resistant crops is leading to more successful crop yields than ever in history. Do the research. Extra farm fields? Ever been to the midwest? As for BD creating more pollutants, please stop and research more. Sulfur and CO2 levels are minimal at best, but I must say NOx is still an issue. No wait a minute, how about particulate filters....oh yeah, you should have researched that too. As for the US economy, this would NOT be a govt corporate welfare program. Again, with due diligence, high yeilding crops and some moderate interim support to our farmers would produce a new source of fuel for America within resonable time frames if this is truly desirable. Best of all, and yes I realize this is possibly an offensive statment, I no longer want to support state sponsered terrorism with my hard earned money. Blood for oil, is maybe pushing it but it's not too far from the truth is it? Engine longevity, power bandwidth and fuel economy were all issues that Rudolph Diesel set out to ensure as the "utopian" motor for the common man. BD has the lowest sulfur content than even ULSD ( or euro spec diesel), has a very high cetane level and acts as a solvent ( whch could be bad for older diesel engines)... so what again was so bad with biodiesel?
Energy is NOT like burning money. It allows countries like the US to continue to be great and prosperous. Our economic vitality is a key factor in continuing the great american diplomacy and economic support to much of the developing world (yes, I know I'm apporching a dangerous and touchy subject). I'm all for renewable resource research which may or may not include biodiesel, but for now it seems as though this may be a very valid fuel source. Brightness, please do shed some "light" on the situation as I did not read of any solutions offered by you.
Well said and agreed. I don't think many of us really do have the answers but we can only hope that with evdience based research, renewable sources of energy will become a major issue for most Americans. Frankly, I fear we will as we have in the past, acclimatize to rising gas prices by voicing our concerns, calling our representatives and then finally accepting it. BTW, I found a another cool link: http://www.uidaho.edu/bae/biodiesel/research/past_research.html
Seems that one thing that few want to buy into is rationing. If that should ever happen (& it could) there could be serious changes in what we drive. It's like a tsunami. It would catch us wide eyed and bewildered that the unthinkable could be a reality. Last point ...Our legislators just might get serious again about "Mass Transit". Lets hope so. Railroadjames(Change is coming)
Our legislators just might get serious again about "Mass Transit
How much is mass transit worth to a community? What is the emissions per person in a full bus and one carrying 3 people? Mass transit works in some urban areas. I am not sure that it is effective cost wise or pollution wise in less urban areas. I know we use the San Diego Trolley to go downtown for special events. It costs more than driving our car. It takes an hour instead of 20 minutes to get there. It saves us the hassle of finding a parking spot within walking distance. It costs the taxpayers a big bundle every year. The times we have rode it there was less than 10% of the seats taken. It is not for every community.
I'm all for renewable resource research which may or may not include biodiesel, but for now it seems as though this may be a very valid fuel source.
I am leaning your direction on biodiesel. It is not available in many places. It is an alternative to fossil fuel. Not all biodiesel is made directly from crops. The most economical and environmentally sound source is used cooking oil. I don't think I will be brewing any in my garage. I will have that option available to me. I just bought a 2005 Passat Wagon TDI in Portland. I will fly up in a week and give it a test run vacation trip. I paid $300 under Invoice in a market that is usually $1000 over MSRP. You just have to get the right dealer at the right moment. If I don't like it after I drive it 7500 miles I will sell it in CA for more than I paid for it. There is a 2003 on a lot in San Diego for $200 over what I am buying a brand new one for. And it does not have leather seats or the 17" wheels and high performance Michellins. The kicker that got me to make the call this morning was I passed my local gas station and regular unleaded and diesel were both $2.49 per gallon.
American Oil companies went into Saudi Arabia with all the Technology and built rigs/found the Oil. In the beginning the US OIL companies owned the fields in that they paid a royalty the Saudi Government and the US as a nation benefited from this relationship. After awhile the Saudi's "privatized" the fields and left American Oil companies with nothing. At the point the US government should have stepped in and told them "No way!". We had the power and there were no Islamic extremes to be dealt with. We as a country were too "nice". We had a chance to re-shape history. We failed. The technology, American know how and more were invested in that country and we did not get our return on investment. Could you imagine a world where US companies controlled the fields in Saudi Arabia (they did and got kicked out). We would be able to set the world price and most def. the US price. FDR and those before him messed up in the worst way and now we pay. :mad:
FDR and those before him messed up in the worst way and now we pay.
Not only that FDR signed an agreement to protect the Saudi Royal Family Forever. I think that had as much to do with the first gulf war as anything. Saddam was headed for Saudi Arabia. Kuwait was an excuse. And of course keeping the largest oil reserve out of unfriendly hands was the end result. Or was it? Too much going on over there that we are not let in on.
By "energy is like burning money" I meant that the cost of energy is like a tax levied all our activities. Nobody uses energy for the sake of energy; it's always for achieving something else: warmth, transportation, manufacturing, entertainment, etc.. The cost of energy is strictly the cost. Hence the market place tries to find the lowest cost possible (after factoring in transportability etc.). That also means, if an alternative energy source works (ie. lower cost than oil and coal), it requires no government support. I'm not entirely sanguine about the 2nd green revolution because as the Harper's aricle showed (thanks Bruce), the first one was what brought us to today's conundrum to begin with. Any new breed of crop that can super charge themselves even faster would have to be fed even more with chemical fertilizers; soil depletion is a worldwide phenomenom after the first green revolution.
Regarding energy bringing about US prosperity, well, there is a missed link that hs not been addressed yet: the US entered into a bargain with the Saudi Royal family more than half a century ago. The US would protect the al-Saudis, in return, Saudis would only price their oil in dollar. That's what makes dollar the reserve currency of the world. Countries like Japan need dollar to buy oil. That's where our cheap consumer goods ultimate come from (China also has to buy oil with dollar, which they also have to get by giving us goods in return for our paper). Saddam decided to upset the applecart by selling oil in Euro, and the next thing you know his regime was toppled. There's someone down in Venezuela talking trash about bartering (i.e. cutting the US out of the currency loop), and he supposedly just imported hundreds of thousands of automatic rifles presumbly to build some kind of massive "people's army" either to intimidate his own people or his neighbors, or just afraid of a regime change, probably all three.
That's what makes dollar the reserve currency of the world.
With the dollar going as low as it has that may be an opportunity for USA industry to make some inroads into foreign goods. You can buy a Suburban for the price of a Honda Hybrid. With the Suburban $8k under MSRP. I'm not comparing the qualities of the two only the utility and size. GM is facing the same problem that most European countries are facing. More people retiring than they have workers to support them. I believe Germany is at a 2 to 1 ratio currently. The same thing will happen to SS in a few years. I believe our automakers try to compete. I'm not sure they can when the dollar is riding high. Maybe this is the swinging of the pendulum.
I drive over 20,000 miles a year, my wife drives 11-12,000 miles a year. We just bought a third car. But the key difference is that when we go car shopping, we tend to look for fuel efficient models with the smaller engine (when available) I would have just loved to buy my I35 with a 2.5L Inline 4 (I25) but Infiniti didn't sell one. If Infiniti sold a G25, I'd probably buy one instead of an I35. I still don't see why I need a 3.5L V6 in a midsize sedan. In a minivan maybe, but definitely not a midsize sedan.
Here is a theory, oil is abiotic. Oil is a renewable resource. The late Thomas Gold, a professor from Cornell wrote a book called the Deep Hot Biosphere. So far, our oil issues have been due to political causes, not an actual shortage. Remember, after the initial runup in oil prices in the '70s, we had oil prices crash in the mid '80s. OPEC should be wary of high prices as the prices could start to fall if other sources of energy look more attractive.
Check out these links, they make for some very interesting reading.
Have read all posts in this Forum and have found it to be an interesting discussion. It seems like the skyrocketing price of oil combined with the recent report on the sorry state of the Earth's eco-system will soon force North Americans to re-evaluate their whole "bigger is better" and "more is not enough" lifestyle ... we may in fact be forced to re-invent our entire economic structure, as it appears that our current system of "sustained growth" is not sustainable ... Our economy will more than likely have to be down-sized and will shift into "maintenance mode", where neccessities of life will replace wants and desires for the average North American ... Of course, if the G8 get their act together NOW and throw all of their financial and intellectual resources into a "Manhattan Project" sized initiave to get us off the Middle East Oil Teat A.S.A.P., then the above sceneario might be way off ...
Suvs are definitely PART of the problem when you have people driving them for no good, logical, sensical reasons. Like every Soccer Mom ever seen in an H2 - that's just not necessary and wasteful.
Do you really think the Earth is going to see its end prematurely due to soccer moms in H2s? Another thing that's been bothering me is, what does using less crude oil have to do with the environment? Running out of oil is more of an inconvenience than an environmental issue. Besides, the earth will continue being a big, round, gravatational planent long after it becomes insuitable for human life. Put that way, environmentalism is no less selfish than the soccer mom buying the H2 for "no good reason."
A contrarian is one who is zigging while most are zagging. A world class contrarian zigs alone. Gold's theories are interesting and have been explored and discussed in scientific circles but there certainly haven't been many willing to jump into his lifeboat.
Regarding run-ups in the 70's. These spikes were due to OPEC tamping down production and caused artificial shortages. Prices are high now with every rig in the world (excluding those that are down for temporary maintenance) pumping as fast as they get get the oil out of the ground. This time it ain't man made shortages.
The "problem" is gasoline prices. While the supply of crude certainly can have a bearing on that, the refining capacity is probably a bigger factor. With the refineries running pretty much at capacity, the amount of crude coming out of the rigs could double tomorrow and we still wouldn't be seeing increase in gasoline supply. They simply can't process more right now, no matter how much raw material they have to work with.
Maybe it's just a result of living long enough to remember similar circumstances on a variety of issues. This reeks of media driven panic to me. All the breathless reports about what the markets are thinking, the overreaction to EVERYTHING that happens and what it will mean for future prices. What I wouldn't give to go back to the days when we didn't have a 24 hour news cycle.
A brief, off topic example of how the news is a problem. I forget the exact day it was reported, but there was a story a week or so ago about some vandals prying the lettering off of cars. That's a story about LOCAL vandalism that was made national news because they have time to fill. Now you have to work at it to take those letters off your car. They typically don't just fall off. Yesterday I saw TWO new cars with letters crudely pried off of the car with a fair amount of damage. I asked both owners if it just happened and they said yes. Certainly not proof of copycat vandalism, but it's the first I've ever seen it around here. Same thing with the never ending drumbeat in the news about gas prices. Why the enthusiasm about bad news?? Because it sells and gets ratings until the next bad thing comes along. Never mind that it might cause real problems, just make sure folks are listening and reading. When a national radio news story tells people to go out and fill up NOW before any price increase comes along, it makes me want to scream.
"Don't forget that if gasoline prices hit $5 per gallon, even if you buy 0 gallons of gasoline, you WILL be paying for the higher gas prices in the form of higher costs of everything at the stores. "
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There's a positive side to that: It might become too expensive to ship goods from China/Southeast Asia (example: Levis,Toyotas). We might discover it's cheaper to build stuff here in America, instead of spending millions of gallons on cross-ocean journeys. It will help boost employment for the average joe.
I agree about 24 hour news cycle but I got news for you. You have to do a little homework if you want to get any solid or for that matter almost any info. regarding peak oil in the mainstream media. For whatever their rationale (not forgetting how important it is to keep us informed about Jacko and Scott Peterson) the big boys and girls have not yet gotten ahold of this story. Once they finally do get a clue their attention will most certainly fan the flames.
Regarding refinng capacities- you're absolutely right...there is most certainly a bottleneck. But refined gas is a product of crude oil and crude has hit new highs again today. (Recall, I'm betting that we will see periodic drops in the price of crude, probably this week.) The long term trend for crude is up, up and away. I hope I'm wrong but I'm not reading anything (and I mean "anything") that indicates otherwise.
It is all Man Made problems. We have allowed the environmentalists to block new refineries. We need more tanker ships to haul the increased production of oil Add to that the war in Iraq and Afghanistan. It surprises me that we don't have a larger problem than we do. Remember the Exxon Valdez oil spill. That was a wake up call to building better tanker ships. They now cost a lot more to build with double hulls for better safety. They do not haul as much crude. Until we get the fleet up to handle the extra capacity now being sold to other importing countries, there will be shortages. If our capacity to refine and store was where it should be we would not have these huge fluctuations in gas prices. You have several of our leaders to blame for this over the past 20 years of doing nothing. This is not the place to name them as I am sure you all know their names and agenda. We either progress or regress, status quo does not work. Unless you want to trade places with a third world country like the Sudan or Uganda.
Recession, famine and war seen if demand outstrips supply
WASHINGTON – Within a couple of hours last week, crude oil prices hit a record $56 a barrel, President Bush fretted publicly over world oil shortages and the Senate voted to open an Alaskan wildlife refuge to drilling.
The converging events drew attention to what administration officials call a temporary global energy crunch. But bigger worries also are bubbling to the surface – fears of a day of reckoning over world oil reserves.
Even as China and India are joining the grab for oil, most experts agree that world production will peak sometime in the next several decades – more likely in the next couple of years, a gaggle of outspoken academics say.
If rising petroleum demand meets falling supply before new energy sources are ready, government officials say, a world that runs on oil could face cataclysmic consequences ranging from recessions to famine and even war.
Peaking oil production “will result in dramatically higher oil prices, which will cause protracted economic hardship in the United States and the world,” a team of Energy Department consultants warned in a report last month. “The challenge of oil peaking deserves immediate, serious attention if risks are to be fully understood and mitigation begun on a timely basis.”
The most obvious step is to transform into a fuel-efficient fleet the 200 million cars, sport-utility vehicles and trucks that guzzle two-thirds of America’s 21 million-barrel-a-day oil consumption, consultant Robert Hirsch and colleagues wrote. They said it would take 10 to 15 years and cost consumers $1.3 trillion to replace half the fleet with vehicles that run on alternative fuels. Hydrogen, diesel oil or ethanol made from corn are among leading options.
How much time the United States and the rest of the world have to change their ways before oil output peaks has been the grist for a sharp debate between government energy experts and a loose network of critics.
Government geologists estimate the Earth still contains plenty of oil – as much as 2 trillion barrels of proven oil and liquid natural gas reserves and another 939 billion barrels in yet-to-be-discovered reservoirs. The Energy Department’s scenarios call for a production peak somewhere between 2021 and the start of the next century, with 2037 the most likely date.
After the peak, said senior Energy Information Administration petroleum geologist David Morehouse, the rate of production drop-off from declining oil fields would likely be “pretty quick.”
“We don’t want the world oil peak to sneak up on us,” said John Wood, who heads a Dallas-based unit that projects oil supply and demand for the EIA.
Kenneth Deffeyes, a Princeton University geology professor, says it might be too late to plan. Deffeyes worked previously in Shell Oil’s research laboratory alongside M. King Hubbert, who gained fame when he accurately predicted in 1956 that oil production in the continental United States would peak between 1965 and 1970.
Using a similar formula, Deffeyes predicts that the global peak will occur by next Thanksgiving. But like a number of scientists making similarly dire forecasts, he has had to push back his date a couple of times.
“I’m not the least bit embarrassed,” he said in a telephone interview. “There’s a year-to-year jitter – a strike in Venezuela or a warmer-than-average winter in the Northeast. But any year between 2003 and 2007 may end up in the Guinness Book of World Records.”
If Deffeyes is right, Morehouse said, “our goose is cooked.”
“If things get bad enough, and somebody gets desperate enough,” he said, an oil peak scenario could lead to war.
Amos Nur, a Stanford University geophysicist, all but predicts a war with China over oil. He notes that Americans consume a per-capita average of 25 barrels of oil each year, while the Chinese average 1.3 barrels and the people of India less than a barrel. If Chinese and Indian consumption reached one-quarter or a third of U.S. consumption, he writes, it would require 50 percent more oil worldwide and tensions could “slide into a military conflict.”
Bush told a news conference that new oil demand “from countries like China” is “outracing supply” and driving up prices.
Ed Porter, a research manager for the American Petroleum Institute, also blamed U.S. policies that have barred drilling in attractive offshore sites and the Arctic National Wildlife Refuge.
Environmentalists say that even if the Arctic refuge holds the hoped-for 15 billion barrels of oil, it would meet just 2 percent of U.S. crude oil needs.
The recent oil price surge could have a positive side: making alternatives such as ethanol more cost-competitive, said Ralph Groschen, a marketing specialist with the Minnesota Department of Agriculture.
Bush urged Congress to pass an energy bill that funds continued Energy Department research into other fuels – research that has focused on converting coal to hydrogen or liquid fuels.
“All of the research is under way,” Morehouse said, “but the question is, is it going fast enough?”
That depends partly on the accuracy of peak oil forecasts. The Energy Information Administration’s varying scenarios are based on a comprehensive 2000 U.S. Geological Survey assessment in which 40 scientists raised the estimate of global oil reserves and undiscovered reservoirs by hundreds of billions of barrels – enough to meet current demand for two decades or more.
Retired USGS senior scientist Warren Hamilton said he looked over the study’s methodology and found it “erred seriously in the overestimation direction.” It relied heavily on guesses to calculate new oil discoveries, he said, and doubled the usual 30 percent recovery rate from reserves “with no technology in mind capable of doing that.”
The EIA’s Wood defended the USGS assessment as “somewhat conservative.” He said enhanced recovery techniques are raising yields at Alaska’s Prudhoe Bay and elsewhere. And, he said, the USGS report intentionally left out 1.6 trillion barrels of heavy oils found in Canadian tar sands and another 1.6 trillion in Venezuela’s Oronoco “tar belt.”
Those resources could significantly delay an oil peak, Wood said, but the peak would move a decade nearer if China’s economic boom pushes world oil demand to a 3 percent growth rate instead of the usual 2 percent.
The U.S. government’s projections also hinge on continued strong Middle East output – especially from Saudi Arabia, which boasts more than 250 billion barrels of recoverable reserves.
Matthew Simmons, chairman of a Houston-based oil industry investment bank, contends in a forthcoming book that the Saudis damaged their oil fields by overproducing in the early 1970s and again after Iraq invaded Kuwait in 1990. That changed the subsurface pressure, creating h
Environmentalists say that even if the Arctic refuge holds the hoped-for 15 billion barrels of oil, it would meet just 2 percent of U.S. crude oil needs.
It has taken almost 30 years to pump 15 billion barrels out of the Prudhoe and surrounding oil fields. It has been a steady safe flow of oil. Other than the human failure of the Exxon Valdez it has been rather uneventful. That is what we need a steady supply without all the turmoil. Anyone that has been to ANWR realizes that it is no different than the rest of the Arctic. It was politicized as something more than it is. We can and should use that resource over time. Making it a political monkey is not useful. For those that live and work in the area it is distressing to see the consumers of a lot of oil especially in the Eastern US make a fuss over something they know very little about.
Our legislators just might get serious again about "Mass Transit". Lets hope so.
Let's not. Let's face it - anywhere that mass transit could actually work, they already have it (Boston, NY, Chicago, San Fran, etc.). The reasons it works in these places is:
1. Lots of people actually work in the metro center. 2. It's difficult to drive to because of traffic. 3. Even if you do drive there, it costs tons of money to park.
Now take Detroit, where the usual suspects are crying foul about increasing the highway capacities and saying we need more mass transit. Unfortunately, only a small percentage of metro-Detroiters actually work in Detroit anymore. Those that do usually have employer-subsidized parking, and for those that don't it's only around $6/day (which is about what my dad pays to commute to Boston by train). So there's zero incentive to take mass transit. Again, the usual suspects turn around and blame "sprawl", which they say is a bad thing, but which I call "living and working where you want, because those places are nicer than the metro center".
Mirth Not certain what you mean by "Mass Transit." In my mind busses could certainly fall into this category. While not nearly efficient as trains how many cars are taken off the road for every bus in operation?
Or (4) 10 hour days for those who could would be a great savings. You could implement that next month, not like the years it would take to start getting more fuel efficient models of vehicles built.
Look how many years it has taken to get hybrid production up to 1% or 2% of sales. It would take many years to replace the 230M vehicles on the U.S. roads alone, never mind the rest of the world.
While not nearly efficient as trains how many cars are taken off the road for every bus in operation?
Well, if you're still talking Detroit, the answer is "not a lot". The Detroit bus system is a money pit that taxpayers keep throwing money down. Not enough people use it for it to make a profit. Like I said before, if parking is cheap and traffic isn't crippling, people will drive.
Take my case - last year I was working in downtown Detroit. I had the option to take the bus. With all the stops and walking from the bus stop, it would take 1.5 hours to get to work with something like $1.50 for the bus and $1.00 in gas (today's prices). Driving, 45 mins, $6.00 for parking, about $6.00 for gas. I drove. The extra 1.5 hours per day (7.5 per week) with my family was more than worth it.
GM's Lutz, Cowger Give Up North American Positions (Update4)
April 4 (Bloomberg) -- General Motors Corp. Chief Executive Rick Wagoner will step in to replace two top deputies in North America after the automaker slashed its 2005 profit forecast in half because of falling sales in the region. (Cont.)
Mirth You're talking about last year. I'm talking about solutions for when gas gets more expensive. Also you old route took x to get you to and from work. How much time would be shaved off x if you didn't have so many cars in the way of the bus?
If you read the piece in its entirety it basically says that the only way to for the big majors to grow their reserves is for them to buy smaller companies that have existing known reserves. If you read between the lines the message is that there are not any great "finds" out there that the big players can go out and develop. The day of the undiscovered gusher is behind us.
Production Drops
ChevronTexaco produced the equivalent of 2.509 million barrels of oil a day in 2004, down from 2.523 million barrels a day in 2003.
Unocal pumped the equivalent of 410,670 barrels of oil a day last year. About 62 percent of Unocal's output is gas, compared with 28 percent at ChevronTexaco.
``The way for major integrated oil companies to grow at this point is through acquisitions,'' said Tim Ghriskey, who helps manage $650 million at Solaris Asset Management in Bedford Hills, New York.
ChevronTexaco's ``growth rate going forward is pretty crummy,'' said James Halloran, who helps manage $33 billion, including ChevronTexaco and Unocal shares, at National City Private Client Group in Cleveland. Halloran spoke in an interview before the Unocal transaction was announced.
Unocal's oil and gas reserves declined 0.3 percent in 2004 to the equivalent of 1.754 billion barrels of oil.
Lehman Brothers and Pillsbury Winthrop Shaw Pittman LLP are advising ChevronTexaco on the transaction. Morgan Stanley & Co. and Wachtell, Lipton, Rosen & Katz are advising Unocal.
Naturally, if everyone, or even most people, took the bus, traffic would be less. Might knock 20-25 mins off my example above (most of the time is taken up by many many many stops). Good luck getting that to happen. Cars have value beyond getting from point A to B. They provide lots of freedom - I can go in earlier if I want, stay late, run errands on the way home from work, meet my wife somewhere after work instead of going home, etc., etc.
The only way you'll get enough people to take the bus to make a bit of difference is if you outlaw cars or make the cost of driving the cars so prohibitive that it overcomes not only the time/cost aspects, but the freedom/control aspects as well. And $5/gallon gas ain't gonna do it.
You say $5.00 per gallon isn't enought to get you to cut back. What amount would be?
Heres the equation:
Most drive around 15,000 mi per year Assume 25 mi per gallon
15000 / 25 = 600 gallons
600 x 5 = $3000.00 per year or $250.00 per month 600 x 6 = $3600.00 per year or $300.00 per month 600 x 7 = $4200.00 per year or $350.00 per month 600 x 8 = $4800.00 per year or $400.00 per month 600 x 9 = $5400.00 per year or $450.00 per month 600 x 10=$6000.00 per year or $500.00 per month
Don't forget the impact higher oil prices will have on rest of economy...higher prices on all commodities, recession, job lay-offs.
Oil has hit another new high, and OPEC has promised to raise its production by another 500,000 barrels per day to help ease the pain. But with capacity tight and demand continuing to grow, high oil prices may be here to stay
TALK about record oil prices is beginning to get a bit tedious; oil seems to be hitting new highs with the regularity of a metronome. This is, naturally, more than a bit tedious for consumers, who are having to dig ever more deeply into their pockets. More frightening still, it might get worse before it gets better. Last week, Goldman Sachs released a report predicting that oil prices may stay above $50 per barrel for several years. Oil prices obliged by jumping. On Monday April 4th, light crude hit $58 for the first time ever. (Cont.)
But by today's consumption it will only supply our needs for 6 to 9 months.
Oil production does not work that way. Getting more than a million barrels a day out of ANWR would be very costly. What that means is you have a steady flow of a million barrels a day for 30 years to consume. If the estimates are anything like Prudhoe, they were originally estimating 9 billion barrels. The field went online in 1977 and has been steady for almost 30 years with oil still coming out of the wells. The minimum flow is 1 million barrels per day and the maximum is 2.2 million barrels per day. When people say there is only 6 months or a years worth of oil and discount it as not worth it, they are using it as a political tool to get their agenda through to the people. When you look at the big picture of oil production around the world it is made up of buying a million barrels here and a million barrels there. We would be better off if we had pipelines from Mexico and Canada flowing directly to the refineries. That is not the case so we do what we can to keep everyone moving down the road. If CA for example was shut off from oil it would probably be in bankruptcy and chaos within weeks. Our government cannot take that chance. We have to protect our oil supplies at any cost. Or we will not survive. Nature is still survival of the fittest.
We have to protect our oil supplies at any cost. Or we will not survive. Nature is still survival of the fittest.
That is the essential problem. The US views Saudi Arabia's and Iraq's oil as their oil supplies. China views them as their oil supplies. France views them as their oil supplies, and so on. Your comments have been echoed in the National Energy Policy since 1992. Iraq is a timely and convenient manifestation from that policy.
Whatever the true accessible oil supply is, there is no excuse for US senators to block increased mpg minimums on cars. There is no excuse for recent laws that allow $100,000 tax write-offs for vehicles that weigh OVER 6,000 lbs. There is no excuse for Americans to set their heaters above 75 in the winter or lower than 65 in the summer. That is pure and simple corruption and gluttony. The price of gas could go anywhere depending on the perceived supply. A few "The sky is falling" type suggestions from the media and you might wind up paying $10 for a gallon of gas by 2007.
Diesel is more than premium unleaded where I'm from, and probably most of new england (if not some of the eastern seaboard).
Good reason for that. You burn a lot of heating oil which is diesel oil. Actually my plan is to use ULSD when close to a source. And that is more expensive than Premium. Still less fuel costs than if I was in an equivalent wagon with a gas engine. I can also use biodiesel. It is not as readily available to me as ULSD. No hybrid fit my needs. The ones on the horizon are even further from what I consider practical. I look for diesel to go below regular within the next month when heating season winds down.
Well I had a 3-year loan with 0 down when my Firebird was new. My payment was like $662/month + tax of about $35 month + gas (say 50 gal/month). So I would guess that was close to $800/month
It's paid for now; so I think I can that covers those scenarios you put up. As I said before it could simply come down to an E-Bay type of competition. It never is a good thing to be lower income, unfortunately, no matter if its gasoline, housing or health care. Work harder and smarter.
The US views Saudi Arabia's and Iraq's oil as their oil supplies. China views them as their oil supplies. France views them as their oil supplies, and so on.
me: I don't think they do. I think that each country wants to obtain them, but they're doing it fairly and purchasing them. And I think what someone said about there being a good future potential for war between China and the U.S. as being ridiculous. Why? Because it would be like the owner of a restaurant attacking his customers. China needs its customers, or else it doesn't really need that oil. One without the other does no one any good! That is the one benefit I see of globalization.
We have contributed to the Chinese need for more fuel and will have to share. I think it just came a little faster than most would have guessed. Get Iraq, Russia & Venezuela producing up to potential and this whole oil shortage will evaporate for the next 30 years. We have not even started on the methane ice that could be trillions of cubic feet reserve. If we keep the politicians out of the oil business things will work much better.
Stagnant Russian oil output fuels fears of shortages By Javier Blas and Kevin Morrison in London Published: April 4 2005 22:29 | Last updated: April 4 2005 22:29
Russian oil output was unchanged in March from February, extending a spell of stagnation of oil output growth and increasing fears that the country's rapid rise in production in the 1990s has petered out.
The figures, released on Monday, showed March output at 9.33m barrels a day below the 9.42m b/d production in September when post-Soviet production hit its highest level. The flagging output showed that the Kremlin's break-up of Yukos, the oil company, as well as high marginal taxation on oil producers, had sapped the Russian oil industry's ability to respond to booming global demand, analysts said.
The Russian government has complained in the past weeks of under-investment in the Russian economy and warned of the danger of the economy overheating as domestic demand outstrips the economy's ability to respond.
Investment in the oil industry has targeted easy-to-develop fields but has shied away from large infrastructure projects. Increased production requires the development of new fields in Siberia, which are more geologically complex.
Oil exports are Russia's largest source of foreign currency income. The country is the largest producer outside of the Organisation of the Petroleum Exporting Countries. Analysts predict that Russia's production this year will only be 3 per cent higher than last year. The government had earlier forecast a production increase of 5 per cent, well below the 7 per cent to 12 per cent rises achieved over the past five years.
Stalling Russian production coupled with rising demand from China has made oil markets nervous. . It has confirmed fears that production outside of Opec is slowing and unable to meet the increase in demand.
Opec intends to make an announcement within 10 days about lifting its official production ceiling to 28m barrels a day, from 27.5m b/d at present. It had hoped to delay discussions of a quota rise until June, but the price increase has forced the cartel to reconsider its strategy.
“It's going to be a political decision to try to calm the market,” said an Opec official in Vienna.
Traders said panic buying last week in the oil market was triggered by a report released by Goldman Sachs, the investment bank, which warned that oil prices could reach $105 a barrel later this year.
Oil prices are likely to remain firmly in the spotlight this week with Alan Greenspan, the chairman of the Federal Reserve, delivering a speech today on energy.
Comments
Bring on the opinions brothers and sisters and invite some facts along for the ride.
Catch is most of our vehicles burn gasoline, not diesel. Part of what's held diesel back has been USA fuel sulfer content (supposedly to be drastically reduced in 2006) which makes it impossible to use affordable pollution equipment to keep diesel engines "clean" . Biodiesel may make this much easier to achieve.
A large number of car companies, especially the Euro, have powerful, efficient diesels begging to come to the USA once we get our diesel fuel act together.
Meanwhile it's amazing how disfunctional the USA is on this issue. The image most car magazines and many responses I see on these forums suggest: We want cheap gas, but won't allow the needed refinery capacity to be built in "our" back yards (so where do the new refineries go? - middle of the ocean, empty desert, underground?). We want fast interstates to drive on, but won't cough up gas tax or other monies to get our rotting, overloaded network rebuilt. We say "lets save fuel", but what's really popular to buy? - cars with the largest horsepower engines possible. Go figure.
yes...I heard...
there is one guy who has a V8 motorboat on the delta..and they sometimes motor into San Francisco to have lunch....says it costs him about $700 for the trip in gas alone......
I would not pretend to be as knowledgable on this subject as you are. Everything I have read leads me to believe that biodiesel is better for the environment than using fossil fuel. My understanding is that biodiesel has little or no sulfur content. It creates about 10% more NOx than conventional diesel and is CO2 (GHG) neutral. As far as adding to farm land that would be a reality if biodiesel were to try and replace fossil fuel. I don't see that happening in our lifetime. I think of it more as a hedge against the folks that control most of the oil reserves.
The theory at the time was that the programming glitch would manifest itself as computer date functions rolled from 1999 to 2000. In short computers wouldn't recognize the 00 of the new millenium and wouldn't be able to contine to function. So what people said. I haven't used my computer in a week who cares. I'll know what day it is. I'll know if I'm hungry too and if I am I'll walk down to the store and get something to eat.
What the doubters were failing to see was that the developed world had become so interconnected because of computers that every little movement we have become accustomed to was scheduled by millions of computers humming away quietly in the background. The guy that hadn't used his computer in a week forgot (or didn't know) that the store that sells the food he's going to go get does use computers. And if the stores computers were unable to talk to the distributers computers the distributers computers would not know to send him stocks for the shelves. Big deal the guy went on the store picks up the phone and calls the distributer. Wellll, he can't because the phone company also uses computers and you can't get a call through. "All right", he finally says in desparation, I'll get in my car myself and drive over to the distributer." Uh...that won't be possible either. The traffic lights work on computers too. Since they weren't working there have been a lot of accidents at intersections. Traffic is at a stand still.
Anyhoo that was then and this is now. And besides we dodged that bullet. And dodge it we did. But here is the difference. The date of the Y2K event was known. Midnight, 1999. So once people took it seriously the IT folks worked their asses off. And we spent a little money along the way as well. Anybody care to take a guess whatt Y2K remediation ended up costing? Would you believe two trillion dollars? Two trillion. That was more money than it took to fight WWII.
Why have I taken this trip down memory lane? Well once again if you believe in the possibility of peak oil we have a fairly serious event we are going to have to face. But this one has an elusive time connected to it. Some say that the event already happened. (Remember when it happened in the US in 1970 it wasn't confirmed until several years went by and it could be determined that production was on a downward slide) Other people say its 10 or 20 or 30 years away. With so many parties disagreeing on when this will occur the urgency of providing some alternatives gets lost in the shuffle.
Think about this. A lot of people keep saying that we will just shift to alternative energies and go about our way. We'll build nuclear, shift to coal gassification, biodiesel, solar, etc. Trouble is to do those things you need two things, power and time. When we went from horses to cars the transition was fairly smooth because horses weren't being depleted. But as we move from oil to x we need the power of oil to take us there. If I'm going to build solar panels and deliver them to market I need oil to do so. If I'm going to build nuclear plants I need the power of oil and time. (This is the one that I want to make certain they have enough time to get it right.)
If, as some believe, that the Saudi Ghawar fields (the motherlode of all oil motherlodes) have already experienced peak oil and that ends up being proven in a year or so will we be far enough down the road to alternative solutions to make a smooth transition? That my friends is the sixty-four thousand dollar question. What is a rocky transition you may ask? I'll leave that to the science fiction writers because personally, I don't want to spend too much time thinking about that.
me: If we didn't spend 10 years on environmental studies and the effect on the carpenter ant population of every state, I believe the actual construction time of a coal gasification plant would be in the 3 year timeframe. During that time the heavy mining cranes, conveyors and trucks could also be built. It would be a good shot in the arm for American industry which has excess capacity such as GM, Ford, Boeing, those military bases and shipyards, that have heavy industrial experience.
Coal gasification would then provide all the oil we want at about an $80/barrel cost. I use 2 industrial events in history as examples of the human will to get things done: the relocation of most of Russian industry (moving 1000 miles east) during WWII, and the repair of the carrier Yorktown in 24 hr after nearly being sunk at the Coral Sea, and joining the battle at Midway.
I also don't think your message isn't going to play well with people who want to own and drive a car once in their lives. They're not going to be motivated not to drive, so that you can continue to drive 5K, 10K or 15K? miles/year.
I am amazed that everyone seems to be an expert. I however make no assertions. I'm just a regular guy who is looking at possible energy sources for the future.
Brightness4, your opinion is of course most welcomed but I'm glad it is an opinion only. Yes, farming is an energy intensive process, but you failed to research or quote several studies that promote "high yield crops" such as those curently being tested in Africa and India. This could possibly become the second "green revolution". This type of farming could literally change the American farmer outlook and make them once again a great American institution. Your comments regarding fertilizers are correct but again, crude distillate refining for these necessary items would be reduced by future use of BD. Genetic technology and use with pest resistant crops is leading to more successful crop yields than ever in history. Do the research. Extra farm fields? Ever been to the midwest? As for BD creating more pollutants, please stop and research more. Sulfur and CO2 levels are minimal at best, but I must say NOx is still an issue. No wait a minute, how about particulate filters....oh yeah, you should have researched that too. As for the US economy, this would NOT be a govt corporate welfare program. Again, with due diligence, high yeilding crops and some moderate interim support to our farmers would produce a new source of fuel for America within resonable time frames if this is truly desirable. Best of all, and yes I realize this is possibly an offensive statment, I no longer want to support state sponsered terrorism with my hard earned money. Blood for oil, is maybe pushing it but it's not too far from the truth is it? Engine longevity, power bandwidth and fuel economy were all issues that Rudolph Diesel set out to ensure as the "utopian" motor for the common man. BD has the lowest sulfur content than even ULSD ( or euro spec diesel), has a very high cetane level and acts as a solvent ( whch could be bad for older diesel engines)... so what again was so bad with biodiesel?
Energy is NOT like burning money. It allows countries like the US to continue to be great and prosperous. Our economic vitality is a key factor in continuing the great american diplomacy and economic support to much of the developing world (yes, I know I'm apporching a dangerous and touchy subject). I'm all for renewable resource research which may or may not include biodiesel, but for now it seems as though this may be a very valid fuel source. Brightness, please do shed some "light" on the situation as I did not read of any solutions offered by you.
BTW, I found a another cool link:
http://www.uidaho.edu/bae/biodiesel/research/past_research.html
It's like a tsunami. It would catch us wide eyed and bewildered that the unthinkable could be a reality.
Last point ...Our legislators just might get serious again about "Mass Transit". Lets hope so.
Railroadjames(Change is coming)
How much is mass transit worth to a community? What is the emissions per person in a full bus and one carrying 3 people? Mass transit works in some urban areas. I am not sure that it is effective cost wise or pollution wise in less urban areas. I know we use the San Diego Trolley to go downtown for special events. It costs more than driving our car. It takes an hour instead of 20 minutes to get there. It saves us the hassle of finding a parking spot within walking distance. It costs the taxpayers a big bundle every year. The times we have rode it there was less than 10% of the seats taken. It is not for every community.
I am leaning your direction on biodiesel. It is not available in many places. It is an alternative to fossil fuel. Not all biodiesel is made directly from crops. The most economical and environmentally sound source is used cooking oil. I don't think I will be brewing any in my garage. I will have that option available to me. I just bought a 2005 Passat Wagon TDI in Portland. I will fly up in a week and give it a test run vacation trip. I paid $300 under Invoice in a market that is usually $1000 over MSRP. You just have to get the right dealer at the right moment. If I don't like it after I drive it 7500 miles I will sell it in CA for more than I paid for it. There is a 2003 on a lot in San Diego for $200 over what I am buying a brand new one for. And it does not have leather seats or the 17" wheels and high performance Michellins. The kicker that got me to make the call this morning was I passed my local gas station and regular unleaded and diesel were both $2.49 per gallon.
Not only that FDR signed an agreement to protect the Saudi Royal Family Forever. I think that had as much to do with the first gulf war as anything. Saddam was headed for Saudi Arabia. Kuwait was an excuse. And of course keeping the largest oil reserve out of unfriendly hands was the end result. Or was it? Too much going on over there that we are not let in on.
Regarding energy bringing about US prosperity, well, there is a missed link that hs not been addressed yet: the US entered into a bargain with the Saudi Royal family more than half a century ago. The US would protect the al-Saudis, in return, Saudis would only price their oil in dollar. That's what makes dollar the reserve currency of the world. Countries like Japan need dollar to buy oil. That's where our cheap consumer goods ultimate come from (China also has to buy oil with dollar, which they also have to get by giving us goods in return for our paper). Saddam decided to upset the applecart by selling oil in Euro, and the next thing you know his regime was toppled. There's someone down in Venezuela talking trash about bartering (i.e. cutting the US out of the currency loop), and he supposedly just imported hundreds of thousands of automatic rifles presumbly to build some kind of massive "people's army" either to intimidate his own people or his neighbors, or just afraid of a regime change, probably all three.
With the dollar going as low as it has that may be an opportunity for USA industry to make some inroads into foreign goods. You can buy a Suburban for the price of a Honda Hybrid. With the Suburban $8k under MSRP. I'm not comparing the qualities of the two only the utility and size. GM is facing the same problem that most European countries are facing. More people retiring than they have workers to support them. I believe Germany is at a 2 to 1 ratio currently. The same thing will happen to SS in a few years. I believe our automakers try to compete. I'm not sure they can when the dollar is riding high. Maybe this is the swinging of the pendulum.
http://www.energybulletin.net/5080.html
I HIGHLY recommend it. It is an eye-opener.
Check out these links, they make for some very interesting reading.
link title
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Our economy will more than likely have to be down-sized and will shift into "maintenance mode", where neccessities of life will replace wants and desires for the average North American ...
Of course, if the G8 get their act together NOW and throw all of their financial and intellectual resources into a "Manhattan Project" sized initiave to get us off the Middle East Oil Teat A.S.A.P., then the above sceneario might be way off ...
Do you really think the Earth is going to see its end prematurely due to soccer moms in H2s? Another thing that's been bothering me is, what does using less crude oil have to do with the environment? Running out of oil is more of an inconvenience than an environmental issue. Besides, the earth will continue being a big, round, gravatational planent long after it becomes insuitable for human life. Put that way, environmentalism is no less selfish than the soccer mom buying the H2 for "no good reason."
A contrarian is one who is zigging while most are zagging. A world class contrarian zigs alone. Gold's theories are interesting and have been explored and discussed in scientific circles but there certainly haven't been many willing to jump into his lifeboat.
Regarding run-ups in the 70's. These spikes were due to OPEC tamping down production and caused artificial shortages. Prices are high now with every rig in the world (excluding those that are down for temporary maintenance) pumping as fast as they get get the oil out of the ground. This time it ain't man made shortages.
Maybe it's just a result of living long enough to remember similar circumstances on a variety of issues. This reeks of media driven panic to me. All the breathless reports about what the markets are thinking, the overreaction to EVERYTHING that happens and what it will mean for future prices. What I wouldn't give to go back to the days when we didn't have a 24 hour news cycle.
A brief, off topic example of how the news is a problem. I forget the exact day it was reported, but there was a story a week or so ago about some vandals prying the lettering off of cars. That's a story about LOCAL vandalism that was made national news because they have time to fill. Now you have to work at it to take those letters off your car. They typically don't just fall off. Yesterday I saw TWO new cars with letters crudely pried off of the car with a fair amount of damage. I asked both owners if it just happened and they said yes. Certainly not proof of copycat vandalism, but it's the first I've ever seen it around here. Same thing with the never ending drumbeat in the news about gas prices. Why the enthusiasm about bad news?? Because it sells and gets ratings until the next bad thing comes along. Never mind that it might cause real problems, just make sure folks are listening and reading. When a national radio news story tells people to go out and fill up NOW before any price increase comes along, it makes me want to scream.
.
There's a positive side to that: It might become too expensive to ship goods from China/Southeast Asia (example: Levis,Toyotas). We might discover it's cheaper to build stuff here in America, instead of spending millions of gallons on cross-ocean journeys. It will help boost employment for the average joe.
troy
I agree about 24 hour news cycle but I got news for you. You have to do a little homework if you want to get any solid or for that matter almost any info. regarding peak oil in the mainstream media. For whatever their rationale (not forgetting how important it is to keep us informed about Jacko and Scott Peterson) the big boys and girls have not yet gotten ahold of this story. Once they finally do get a clue their attention will most certainly fan the flames.
Regarding refinng capacities- you're absolutely right...there is most certainly a bottleneck. But refined gas is a product of crude oil and crude has hit new highs again today. (Recall, I'm betting that we will see periodic drops in the price of crude, probably this week.) The long term trend for crude is up, up and away. I hope I'm wrong but I'm not reading anything (and I mean "anything") that indicates otherwise.
It is all Man Made problems. We have allowed the environmentalists to block new refineries. We need more tanker ships to haul the increased production of oil Add to that the war in Iraq and Afghanistan. It surprises me that we don't have a larger problem than we do. Remember the Exxon Valdez oil spill. That was a wake up call to building better tanker ships. They now cost a lot more to build with double hulls for better safety. They do not haul as much crude. Until we get the fleet up to handle the extra capacity now being sold to other importing countries, there will be shortages. If our capacity to refine and store was where it should be we would not have these huge fluctuations in gas prices. You have several of our leaders to blame for this over the past 20 years of doing nothing. This is not the place to name them as I am sure you all know their names and agenda. We either progress or regress, status quo does not work. Unless you want to trade places with a third world country like the Sudan or Uganda.
Sun, 3 Apr 2005 13:52:26 -0500
By Greg Gordon
Republished from Sacramento Bee
Recession, famine and war seen if demand outstrips supply
WASHINGTON – Within a couple of hours last week, crude oil prices hit a record $56 a barrel, President Bush fretted publicly over world oil shortages and the Senate voted to open an Alaskan wildlife refuge to drilling.
The converging events drew attention to what administration officials call a temporary global energy crunch. But bigger worries also are bubbling to the surface – fears of a day of reckoning over world oil reserves.
Even as China and India are joining the grab for oil, most experts agree that world production will peak sometime in the next several decades – more likely in the next couple of years, a gaggle of outspoken academics say.
If rising petroleum demand meets falling supply before new energy sources are ready, government officials say, a world that runs on oil could face cataclysmic consequences ranging from recessions to famine and even war.
Peaking oil production “will result in dramatically higher oil prices, which will cause protracted economic hardship in the United States and the world,” a team of Energy Department consultants warned in a report last month. “The challenge of oil peaking deserves immediate, serious attention if risks are to be fully understood and mitigation begun on a timely basis.”
The most obvious step is to transform into a fuel-efficient fleet the 200 million cars, sport-utility vehicles and trucks that guzzle two-thirds of America’s 21 million-barrel-a-day oil consumption, consultant Robert Hirsch and colleagues wrote. They said it would take 10 to 15 years and cost consumers $1.3 trillion to replace half the fleet with vehicles that run on alternative fuels. Hydrogen, diesel oil or ethanol made from corn are among leading options.
How much time the United States and the rest of the world have to change their ways before oil output peaks has been the grist for a sharp debate between government energy experts and a loose network of critics.
Government geologists estimate the Earth still contains plenty of oil – as much as 2 trillion barrels of proven oil and liquid natural gas reserves and another 939 billion barrels in yet-to-be-discovered reservoirs. The Energy Department’s scenarios call for a production peak somewhere between 2021 and the start of the next century, with 2037 the most likely date.
After the peak, said senior Energy Information Administration petroleum geologist David Morehouse, the rate of production drop-off from declining oil fields would likely be “pretty quick.”
“We don’t want the world oil peak to sneak up on us,” said John Wood, who heads a Dallas-based unit that projects oil supply and demand for the EIA.
Kenneth Deffeyes, a Princeton University geology professor, says it might be too late to plan. Deffeyes worked previously in Shell Oil’s research laboratory alongside M. King Hubbert, who gained fame when he accurately predicted in 1956 that oil production in the continental United States would peak between 1965 and 1970.
Using a similar formula, Deffeyes predicts that the global peak will occur by next Thanksgiving. But like a number of scientists making similarly dire forecasts, he has had to push back his date a couple of times.
“I’m not the least bit embarrassed,” he said in a telephone interview. “There’s a year-to-year jitter – a strike in Venezuela or a warmer-than-average winter in the Northeast. But any year between 2003 and 2007 may end up in the Guinness Book of World Records.”
If Deffeyes is right, Morehouse said, “our goose is cooked.”
“If things get bad enough, and somebody gets desperate enough,” he said, an oil peak scenario could lead to war.
Amos Nur, a Stanford University geophysicist, all but predicts a war with China over oil. He notes that Americans consume a per-capita average of 25 barrels of oil each year, while the Chinese average 1.3 barrels and the people of India less than a barrel. If Chinese and Indian consumption reached one-quarter or a third of U.S. consumption, he writes, it would require 50 percent more oil worldwide and tensions could “slide into a military conflict.”
Bush told a news conference that new oil demand “from countries like China” is “outracing supply” and driving up prices.
Ed Porter, a research manager for the American Petroleum Institute, also blamed U.S. policies that have barred drilling in attractive offshore sites and the Arctic National Wildlife Refuge.
Environmentalists say that even if the Arctic refuge holds the hoped-for 15 billion barrels of oil, it would meet just 2 percent of U.S. crude oil needs.
The recent oil price surge could have a positive side: making alternatives such as ethanol more cost-competitive, said Ralph Groschen, a marketing specialist with the Minnesota Department of Agriculture.
Bush urged Congress to pass an energy bill that funds continued Energy Department research into other fuels – research that has focused on converting coal to hydrogen or liquid fuels.
“All of the research is under way,” Morehouse said, “but the question is, is it going fast enough?”
That depends partly on the accuracy of peak oil forecasts. The Energy Information Administration’s varying scenarios are based on a comprehensive 2000 U.S. Geological Survey assessment in which 40 scientists raised the estimate of global oil reserves and undiscovered reservoirs by hundreds of billions of barrels – enough to meet current demand for two decades or more.
Retired USGS senior scientist Warren Hamilton said he looked over the study’s methodology and found it “erred seriously in the overestimation direction.” It relied heavily on guesses to calculate new oil discoveries, he said, and doubled the usual 30 percent recovery rate from reserves “with no technology in mind capable of doing that.”
The EIA’s Wood defended the USGS assessment as “somewhat conservative.” He said enhanced recovery techniques are raising yields at Alaska’s Prudhoe Bay and elsewhere. And, he said, the USGS report intentionally left out 1.6 trillion barrels of heavy oils found in Canadian tar sands and another 1.6 trillion in Venezuela’s Oronoco “tar belt.”
Those resources could significantly delay an oil peak, Wood said, but the peak would move a decade nearer if China’s economic boom pushes world oil demand to a 3 percent growth rate instead of the usual 2 percent.
The U.S. government’s projections also hinge on continued strong Middle East output – especially from Saudi Arabia, which boasts more than 250 billion barrels of recoverable reserves.
Matthew Simmons, chairman of a Houston-based oil industry investment bank, contends in a forthcoming book that the Saudis damaged their oil fields by overproducing in the early 1970s and again after Iraq invaded Kuwait in 1990. That changed the subsurface pressure, creating h
It has taken almost 30 years to pump 15 billion barrels out of the Prudhoe and surrounding oil fields. It has been a steady safe flow of oil. Other than the human failure of the Exxon Valdez it has been rather uneventful. That is what we need a steady supply without all the turmoil. Anyone that has been to ANWR realizes that it is no different than the rest of the Arctic. It was politicized as something more than it is. We can and should use that resource over time. Making it a political monkey is not useful. For those that live and work in the area it is distressing to see the consumers of a lot of oil especially in the Eastern US make a fuss over something they know very little about.
WVK
Let's not. Let's face it - anywhere that mass transit could actually work, they already have it (Boston, NY, Chicago, San Fran, etc.). The reasons it works in these places is:
1. Lots of people actually work in the metro center.
2. It's difficult to drive to because of traffic.
3. Even if you do drive there, it costs tons of money to park.
Now take Detroit, where the usual suspects are crying foul about increasing the highway capacities and saying we need more mass transit. Unfortunately, only a small percentage of metro-Detroiters actually work in Detroit anymore. Those that do usually have employer-subsidized parking, and for those that don't it's only around $6/day (which is about what my dad pays to commute to Boston by train). So there's zero incentive to take mass transit. Again, the usual suspects turn around and blame "sprawl", which they say is a bad thing, but which I call "living and working where you want, because those places are nicer than the metro center".
Not certain what you mean by "Mass Transit." In my mind busses could certainly fall into this category. While not nearly efficient as trains how many cars are taken off the road for every bus in operation?
Look how many years it has taken to get hybrid production up to 1% or 2% of sales. It would take many years to replace the 230M vehicles on the U.S. roads alone, never mind the rest of the world.
Well, if you're still talking Detroit, the answer is "not a lot". The Detroit bus system is a money pit that taxpayers keep throwing money down. Not enough people use it for it to make a profit. Like I said before, if parking is cheap and traffic isn't crippling, people will drive.
Take my case - last year I was working in downtown Detroit. I had the option to take the bus. With all the stops and walking from the bus stop, it would take 1.5 hours to get to work with something like $1.50 for the bus and $1.00 in gas (today's prices). Driving, 45 mins, $6.00 for parking, about $6.00 for gas. I drove. The extra 1.5 hours per day (7.5 per week) with my family was more than worth it.
April 4 (Bloomberg) -- General Motors Corp. Chief Executive Rick Wagoner will step in to replace two top deputies in North America after the automaker slashed its 2005 profit forecast in half because of falling sales in the region. (Cont.)
Full story:
http://www.bloomberg.com/apps/news?pid=10000103&refer=news_index&sid=a3U6vCYaR9Tk
You're talking about last year. I'm talking about solutions for when gas gets more expensive. Also you old route took x to get you to and from work. How much time would be shaved off x if you didn't have so many cars in the way of the bus?
http://quote.bloomberg.com/apps/news?pid=10000103&sid=aSjgGUH8WZLk&refer=news_index
If you read the piece in its entirety it basically says that the only way to for the big majors to grow their reserves is for them to buy smaller companies that have existing known reserves. If you read between the lines the message is that there are not any great "finds" out there that the big players can go out and develop. The day of the undiscovered gusher is behind us.
Production Drops
ChevronTexaco produced the equivalent of 2.509 million barrels of oil a day in 2004, down from 2.523 million barrels a day in 2003.
Unocal pumped the equivalent of 410,670 barrels of oil a day last year. About 62 percent of Unocal's output is gas, compared with 28 percent at ChevronTexaco.
``The way for major integrated oil companies to grow at this point is through acquisitions,'' said Tim Ghriskey, who helps manage $650 million at Solaris Asset Management in Bedford Hills, New York.
ChevronTexaco's ``growth rate going forward is pretty crummy,'' said James Halloran, who helps manage $33 billion, including ChevronTexaco and Unocal shares, at National City Private Client Group in Cleveland. Halloran spoke in an interview before the Unocal transaction was announced.
Unocal's oil and gas reserves declined 0.3 percent in 2004 to the equivalent of 1.754 billion barrels of oil.
Lehman Brothers and Pillsbury Winthrop Shaw Pittman LLP are advising ChevronTexaco on the transaction. Morgan Stanley & Co. and Wachtell, Lipton, Rosen & Katz are advising Unocal.
The only way you'll get enough people to take the bus to make a bit of difference is if you outlaw cars or make the cost of driving the cars so prohibitive that it overcomes not only the time/cost aspects, but the freedom/control aspects as well. And $5/gallon gas ain't gonna do it.
You say $5.00 per gallon isn't enought to get you to cut back. What amount would be?
Heres the equation:
Most drive around 15,000 mi per year
Assume 25 mi per gallon
15000 / 25 = 600 gallons
600 x 5 = $3000.00 per year or $250.00 per month
600 x 6 = $3600.00 per year or $300.00 per month
600 x 7 = $4200.00 per year or $350.00 per month
600 x 8 = $4800.00 per year or $400.00 per month
600 x 9 = $5400.00 per year or $450.00 per month
600 x 10=$6000.00 per year or $500.00 per month
Don't forget the impact higher oil prices will have on rest of economy...higher prices on all commodities, recession, job lay-offs.
http://www.economist.com/agenda/displayStory.cfm?story_id=3831358
A titanic struggle between supply and demand
Apr 4th 2005
From The Economist Global Agenda
Oil has hit another new high, and OPEC has promised to raise its production by another 500,000 barrels per day to help ease the pain. But with capacity tight and demand continuing to grow, high oil prices may be here to stay
TALK about record oil prices is beginning to get a bit tedious; oil seems to be hitting new highs with the regularity of a metronome. This is, naturally, more than a bit tedious for consumers, who are having to dig ever more deeply into their pockets. More frightening still, it might get worse before it gets better. Last week, Goldman Sachs released a report predicting that oil prices may stay above $50 per barrel for several years. Oil prices obliged by jumping. On Monday April 4th, light crude hit $58 for the first time ever. (Cont.)
Oil production does not work that way. Getting more than a million barrels a day out of ANWR would be very costly. What that means is you have a steady flow of a million barrels a day for 30 years to consume. If the estimates are anything like Prudhoe, they were originally estimating 9 billion barrels. The field went online in 1977 and has been steady for almost 30 years with oil still coming out of the wells. The minimum flow is 1 million barrels per day and the maximum is 2.2 million barrels per day. When people say there is only 6 months or a years worth of oil and discount it as not worth it, they are using it as a political tool to get their agenda through to the people. When you look at the big picture of oil production around the world it is made up of buying a million barrels here and a million barrels there. We would be better off if we had pipelines from Mexico and Canada flowing directly to the refineries. That is not the case so we do what we can to keep everyone moving down the road. If CA for example was shut off from oil it would probably be in bankruptcy and chaos within weeks. Our government cannot take that chance. We have to protect our oil supplies at any cost. Or we will not survive. Nature is still survival of the fittest.
That is the essential problem. The US views Saudi Arabia's and Iraq's oil as their oil supplies. China views them as their oil supplies. France views them as their oil supplies, and so on. Your comments have been echoed in the National Energy Policy since 1992. Iraq is a timely and convenient manifestation from that policy.
Whatever the true accessible oil supply is, there is no excuse for US senators to block increased mpg minimums on cars. There is no excuse for recent laws that allow $100,000 tax write-offs for vehicles that weigh OVER 6,000 lbs. There is no excuse for Americans to set their heaters above 75 in the winter or lower than 65 in the summer. That is pure and simple corruption and gluttony. The price of gas could go anywhere depending on the perceived supply. A few "The sky is falling" type suggestions from the media and you might wind up paying $10 for a gallon of gas by 2007.
Diesel is more than premium unleaded where I'm from, and probably most of new england (if not some of the eastern seaboard).
Good reason for that. You burn a lot of heating oil which is diesel oil. Actually my plan is to use ULSD when close to a source. And that is more expensive than Premium. Still less fuel costs than if I was in an equivalent wagon with a gas engine. I can also use biodiesel. It is not as readily available to me as ULSD. No hybrid fit my needs. The ones on the horizon are even further from what I consider practical. I look for diesel to go below regular within the next month when heating season winds down.
It's paid for now; so I think I can that covers those scenarios you put up. As I said before it could simply come down to an E-Bay type of competition. It never is a good thing to be lower income, unfortunately, no matter if its gasoline, housing or health care. Work harder and smarter.
me: I don't think they do. I think that each country wants to obtain them, but they're doing it fairly and purchasing them. And I think what someone said about there being a good future potential for war between China and the U.S. as being ridiculous. Why? Because it would be like the owner of a restaurant attacking his customers. China needs its customers, or else it doesn't really need that oil. One without the other does no one any good! That is the one benefit I see of globalization.
We have contributed to the Chinese need for more fuel and will have to share. I think it just came a little faster than most would have guessed. Get Iraq, Russia & Venezuela producing up to potential and this whole oil shortage will evaporate for the next 30 years. We have not even started on the methane ice that could be trillions of cubic feet reserve. If we keep the politicians out of the oil business things will work much better.
By Javier Blas and Kevin Morrison in London
Published: April 4 2005 22:29 | Last updated: April 4 2005 22:29
Russian oil output was unchanged in March from February, extending a spell of stagnation of oil output growth and increasing fears that the country's rapid rise in production in the 1990s has petered out.
The figures, released on Monday, showed March output at 9.33m barrels a day below the 9.42m b/d production in September when post-Soviet production hit its highest level. The flagging output showed that the Kremlin's break-up of Yukos, the oil company, as well as high marginal taxation on oil producers, had sapped the Russian oil industry's ability to respond to booming global demand, analysts said.
The Russian government has complained in the past weeks of under-investment in the Russian economy and warned of the danger of the economy overheating as domestic demand outstrips the economy's ability to respond.
Investment in the oil industry has targeted easy-to-develop fields but has shied away from large infrastructure projects. Increased production requires the development of new fields in Siberia, which are more geologically complex.
Oil exports are Russia's largest source of foreign currency income. The country is the largest producer outside of the Organisation of the Petroleum Exporting Countries. Analysts predict that Russia's production this year will only be 3 per cent higher than last year. The government had earlier forecast a production increase of 5 per cent, well below the 7 per cent to 12 per cent rises achieved over the past five years.
Stalling Russian production coupled with rising demand from China has made oil markets nervous. . It has confirmed fears that production outside of Opec is slowing and unable to meet the increase in demand.
Opec intends to make an announcement within 10 days about lifting its official production ceiling to 28m barrels a day, from 27.5m b/d at present. It had hoped to delay discussions of a quota rise until June, but the price increase has forced the cartel to reconsider its strategy.
“It's going to be a political decision to try to calm the market,” said an Opec official in Vienna.
Traders said panic buying last week in the oil market was triggered by a report released by Goldman Sachs, the investment bank, which warned that oil prices could reach $105 a barrel later this year.
Oil prices are likely to remain firmly in the spotlight this week with Alan Greenspan, the chairman of the Federal Reserve, delivering a speech today on energy.
Preceeding found at : http://news.ft.com/cms/s/e00e5b4e-a54b-11d9-8616-00000e2511c8.html