oil, the truth hurts..

For those of you who didn't like my comments about population, here is
another take on it. The reality is each of us are using more oil, there are
more of us, and some of our politics are already controlled by oil nations.
In the late 1800's, oil was that 'messy stuff' that bubble up out of the
ground in Pennsylvania, now we have to drill down 2 miles to find it.

Those of you who really think the Saudis are our friends are dumb. We are
their customer. They do not like us, they like our money (and OUR military
which helps keep the royal family in power)... most of us do not like them,
we like their oil....

So, you can bury your collective heads in the sand if you want to... They
said oil would never get to $50.00 per barrel, now they are saying it will
never reach $100 per barrel.

The following is from a newsletter written by 'a friend'.

Arne

===============

GLOBAL OIL PRODUCTION IS ABOUT TO PEAK

It seems that I am making it a habit to smack readers in the forehead
every month with snappy headlines that cut painfully to the point. This
month that habit continues.

Although I have written many times over the past six years about the
various conditions that are going to be very influential to oil prices,
some of the research I have been reading lately shows that world oil
production will likely peak either this year or next. After that, world
oil production will begin to steadily decline and as this begins to
happen, oil prices will begin to increase dramatically and the major,
oil-consuming economies could potentially suffer devastating levels of
inflation. When discussing this prospect with geologists and economists
you will hear this situation described as "peak oil".

Discussion of this looming problem can be directly traced back to a
geologist who worked for Shell Oil back in the 1950's by the name of M.
King Hubbert. He wrote a report back in 1956 predicting that U.S. oil
production would peak in 1970 that his peers in science dismissed as
ridiculous. After all, in the decades leading up to Mr. Hubbert's report,
there continued to be one massive oil field discovery after another and the
prospect that U.S. oil production should ever decline was met with
considerable skepticism, and his bosses at Shell begged him not to talk
about his theories in public.

But America's oil production DID peak in 1970 and has been in steady
decline every single year since then. Even the unexpected discovery of a
13 billion barrel reserve in Alaska's Prudhoe Bay (long after Mr. Hubbert
made his prediction) has been unable to slow or reverse the trend.

His basic premise was that the largest oil reserves in the world are the
easiest to discover and all were identified very early on in the search.
While there are certainly many smaller pockets of oil scattered throughout
the world, they are progressively more difficult and expensive to recover.
Not to mention that world oil consumption has only continued to grow. We
have right now reached a point where oil companies are extracting oil from
the ground and we are consuming it at a much faster rate than new oil is
being discovered.

Many people think that the price of gasoline at the pump right now is at
historically high levels, which is not at all true. By any
inflation-adjusted standard, gasoline and other fuel prices are still well
below any sort of record high, and the prospect of $5.00 or $6.00 per
gallon gas in the United States in the next few years is a completely
probable situation. Since fuel prices affect literally every aspect and
sector of the economy, you can easily imagine the crippling inflation that
will result from such a scenario. Most of the major consumers of oil are
now countries that do not produce enough oil domestically and must rely
heavily on imported oil. These countries include the United States,
China, Japan, India, France and Germany. The competition that will occur
between these countries as they seek to align themselves politically with
the oil producing countries will likely cause unavoidable global tensions
that could conceivably cause substantial instability. That discussion is
best left to some future newsletter.

In conversations I have with people about this topic, I get this sense
that the belief is that Saudi Arabia, Russia, Venezuela and other oil
producing countries could simply ratchet up their output to satisfy any
shortfalls. The truth of the situation, however, is that all these
countries are basically running all-out right now and have very little
excess capacity left and no genuine prospect of substantially increasing
output. I wrote a few months ago that the United States had not built a
new oil refinery in 30 years and none are currently on the drawing board.
Current refineries are running well over 90%+ capacity already. For these
reasons, even the slightest interruption in the oil markets (hurricanes,
wars, political squabbles) will instantly impact the price of oil. This
resulting volatility will have a damaging effect on consumer sentiment and
confidence.

Certainly there can be improvements in technology and conservation efforts
that could smooth the transition from fossil fuels to alternative sources,
and while many of these are viable alternatives, none of them are going to
be ready in an adequately fast period of time. Since necessity is almost
always the mother of invention, it won't be until the environment of
higher priced oil appears permanent that consumers and governments will
commit themselves to changing their lifestyles. At that point it should
take the better part of a decade for the changes to truly begin to be
implemented and take effect: Making for a pretty miserable decade.

Treasuries....

Think someone was talking about treasuries last week... this might be of
interest.

========================

In any event, you can still view both high-speed and low-speed versions of
clip by visiting the homepage at the following link:

Re: oil, the truth hurts..

Arne wrote:
> For those of you who didn't like my comments about population, here is
> another take on it. The reality is each of us are using more oil, there are
> more of us, and some of our politics are already controlled by oil nations.
> In the late 1800's, oil was that 'messy stuff' that bubble up out of the
> ground in Pennsylvania, now we have to drill down 2 miles to find it.
>
> Those of you who really think the Saudis are our friends are dumb. We are
> their customer. They do not like us, they like our money (and OUR military
> which helps keep the royal family in power)... most of us do not like them,
> we like their oil....
>
> So, you can bury your collective heads in the sand if you want to... They
> said oil would never get to $50.00 per barrel, now they are saying it will
> never reach $100 per barrel.
>
> The following is from a newsletter written by 'a friend'.
>
> Arne
>
I am not sure what sort of response you expect, Arne. You and your
'friend' are right of course. There is a reducing supply of oil which is
a finite resource. At the same time there is an increasing demand not
only from the USA and the western world in general but from the growing
economies of China and India. The obvious economic effect will be a
rising oil price which could continue to rise almost without limit to
balance supply and demand.

All the other goods which require energy in their manufacture, which is
most things, or use it like cars, will also have rising prices and
consequent reducing demand. Gas-guzzling SUVs will be out, replaced
temporarily by smaller more efficient petrol, diesel or hybrid cars
until petrol becomes too expensive even for those. Electric cars charged
from wind, wave, solar or nuclear power could be the eventual mode of
transport.

Improved insulation of houses could reduce the demand for power for
heating and air-conditioning substantially.

However there is no certainty that this will all happen smoothly and
that the countries with the remaining oil stocks, as they become ever
more valuable and desirable to the countries that don't have them, will
be left in peaceful possession. The US invasion of Iraq could be the
first of many oil wars.

Another finite resource with an increasing demand is fresh water.
Ever-growing populations will run out of this soon and it won't be
possible to use cheap oil for desalination for long. Will we have water
wars as well?

> ===============
>
> GLOBAL OIL PRODUCTION IS ABOUT TO PEAK
>
> It seems that I am making it a habit to smack readers in the forehead
> every month with snappy headlines that cut painfully to the point. This
> month that habit continues.
>
> Although I have written many times over the past six years about the
> various conditions that are going to be very influential to oil prices,
> some of the research I have been reading lately shows that world oil
> production will likely peak either this year or next. After that, world
> oil production will begin to steadily decline and as this begins to
> happen, oil prices will begin to increase dramatically and the major,
> oil-consuming economies could potentially suffer devastating levels of
> inflation. When discussing this prospect with geologists and economists
> you will hear this situation described as "peak oil".
>
> Discussion of this looming problem can be directly traced back to a
> geologist who worked for Shell Oil back in the 1950's by the name of M.
> King Hubbert. He wrote a report back in 1956 predicting that U.S. oil
> production would peak in 1970 that his peers in science dismissed as
> ridiculous. After all, in the decades leading up to Mr. Hubbert's report,
> there continued to be one massive oil field discovery after another and the
> prospect that U.S. oil production should ever decline was met with
> considerable skepticism, and his bosses at Shell begged him not to talk
> about his theories in public.
>
> But America's oil production DID peak in 1970 and has been in steady
> decline every single year since then. Even the unexpected discovery of a
> 13 billion barrel reserve in Alaska's Prudhoe Bay (long after Mr. Hubbert
> made his prediction) has been unable to slow or reverse the trend.
>
> His basic premise was that the largest oil reserves in the world are the
> easiest to discover and all were identified very early on in the search.
> While there are certainly many smaller pockets of oil scattered throughout
> the world, they are progressively more difficult and expensive to recover.
> Not to mention that world oil consumption has only continued to grow. We
> have right now reached a point where oil companies are extracting oil from
> the ground and we are consuming it at a much faster rate than new oil is
> being discovered.
>
> Many people think that the price of gasoline at the pump right now is at
> historically high levels, which is not at all true. By any
> inflation-adjusted standard, gasoline and other fuel prices are still well
> below any sort of record high, and the prospect of $5.00 or $6.00 per
> gallon gas in the United States in the next few years is a completely
> probable situation. Since fuel prices affect literally every aspect and
> sector of the economy, you can easily imagine the crippling inflation that
> will result from such a scenario. Most of the major consumers of oil are
> now countries that do not produce enough oil domestically and must rely
> heavily on imported oil. These countries include the United States,
> China, Japan, India, France and Germany. The competition that will occur
> between these countries as they seek to align themselves politically with
> the oil producing countries will likely cause unavoidable global tensions
> that could conceivably cause substantial instability. That discussion is
> best left to some future newsletter.
>
> In conversations I have with people about this topic, I get this sense
> that the belief is that Saudi Arabia, Russia, Venezuela and other oil
> producing countries could simply ratchet up their output to satisfy any
> shortfalls. The truth of the situation, however, is that all these
> countries are basically running all-out right now and have very little
> excess capacity left and no genuine prospect of substantially increasing
> output. I wrote a few months ago that the United States had not built a
> new oil refinery in 30 years and none are currently on the drawing board.
> Current refineries are running well over 90%+ capacity already. For these
> reasons, even the slightest interruption in the oil markets (hurricanes,
> wars, political squabbles) will instantly impact the price of oil. This
> resulting volatility will have a damaging effect on consumer sentiment and
> confidence.
>
> Certainly there can be improvements in technology and conservation efforts
> that could smooth the transition from fossil fuels to alternative sources,
> and while many of these are viable alternatives, none of them are going to
> be ready in an adequately fast period of time. Since necessity is almost
> always the mother of invention, it won't be until the environment of
> higher priced oil appears permanent that consumers and governments will
> commit themselves to changing their lifestyles. At that point it should
> take the better part of a decade for the changes to truly begin to be
> implemented and take effect: Making for a pretty miserable decade.
>
>
>

Re: oil, the truth hurts..

I'm not looking for any response.... just putting my thoughts out there.

Arne

"David Wilkinson" <> wrote in message
news:d8289h$3ph$
> Arne wrote:
>> For those of you who didn't like my comments about population, here is
>> another take on it. The reality is each of us are using more oil, there
>> are more of us, and some of our politics are already controlled by oil
>> nations. In the late 1800's, oil was that 'messy stuff' that bubble up
>> out of the ground in Pennsylvania, now we have to drill down 2 miles to
>> find it.
>>
>> Those of you who really think the Saudis are our friends are dumb. We are
>> their customer. They do not like us, they like our money (and OUR
>> military which helps keep the royal family in power)... most of us do not
>> like them, we like their oil....
>>
>> So, you can bury your collective heads in the sand if you want to... They
>> said oil would never get to $50.00 per barrel, now they are saying it
>> will never reach $100 per barrel.
>>
>> The following is from a newsletter written by 'a friend'.
>>
>> Arne
>>
> I am not sure what sort of response you expect, Arne. You and your
> 'friend' are right of course. There is a reducing supply of oil which is a
> finite resource. At the same time there is an increasing demand not only
> from the USA and the western world in general but from the growing
> economies of China and India. The obvious economic effect will be a rising
> oil price which could continue to rise almost without limit to balance
> supply and demand.
>
> All the other goods which require energy in their manufacture, which is
> most things, or use it like cars, will also have rising prices and
> consequent reducing demand. Gas-guzzling SUVs will be out, replaced
> temporarily by smaller more efficient petrol, diesel or hybrid cars until
> petrol becomes too expensive even for those. Electric cars charged from
> wind, wave, solar or nuclear power could be the eventual mode of
> transport.
>
> Improved insulation of houses could reduce the demand for power for
> heating and air-conditioning substantially.
>
> However there is no certainty that this will all happen smoothly and that
> the countries with the remaining oil stocks, as they become ever more
> valuable and desirable to the countries that don't have them, will be left
> in peaceful possession. The US invasion of Iraq could be the first of many
> oil wars.
>
> Another finite resource with an increasing demand is fresh water.
> Ever-growing populations will run out of this soon and it won't be
> possible to use cheap oil for desalination for long. Will we have water
> wars as well?
>
>> ===============
>>
>> GLOBAL OIL PRODUCTION IS ABOUT TO PEAK
>>
>> It seems that I am making it a habit to smack readers in the forehead
>> every month with snappy headlines that cut painfully to the point. This
>> month that habit continues.
>>
>> Although I have written many times over the past six years about the
>> various conditions that are going to be very influential to oil prices,
>> some of the research I have been reading lately shows that world oil
>> production will likely peak either this year or next. After that, world
>> oil production will begin to steadily decline and as this begins to
>> happen, oil prices will begin to increase dramatically and the major,
>> oil-consuming economies could potentially suffer devastating levels of
>> inflation. When discussing this prospect with geologists and economists
>> you will hear this situation described as "peak oil".
>>
>> Discussion of this looming problem can be directly traced back to a
>> geologist who worked for Shell Oil back in the 1950's by the name of M.
>> King Hubbert. He wrote a report back in 1956 predicting that U.S. oil
>> production would peak in 1970 that his peers in science dismissed as
>> ridiculous. After all, in the decades leading up to Mr. Hubbert's
>> report,
>> there continued to be one massive oil field discovery after another and
>> the
>> prospect that U.S. oil production should ever decline was met with
>> considerable skepticism, and his bosses at Shell begged him not to talk
>> about his theories in public.
>>
>> But America's oil production DID peak in 1970 and has been in steady
>> decline every single year since then. Even the unexpected discovery of a
>> 13 billion barrel reserve in Alaska's Prudhoe Bay (long after Mr. Hubbert
>> made his prediction) has been unable to slow or reverse the trend.
>>
>> His basic premise was that the largest oil reserves in the world are the
>> easiest to discover and all were identified very early on in the search.
>> While there are certainly many smaller pockets of oil scattered
>> throughout
>> the world, they are progressively more difficult and expensive to
>> recover.
>> Not to mention that world oil consumption has only continued to grow. We
>> have right now reached a point where oil companies are extracting oil
>> from
>> the ground and we are consuming it at a much faster rate than new oil is
>> being discovered.
>>
>> Many people think that the price of gasoline at the pump right now is at
>> historically high levels, which is not at all true. By any
>> inflation-adjusted standard, gasoline and other fuel prices are still
>> well
>> below any sort of record high, and the prospect of $5.00 or $6.00 per
>> gallon gas in the United States in the next few years is a completely
>> probable situation. Since fuel prices affect literally every aspect and
>> sector of the economy, you can easily imagine the crippling inflation
>> that
>> will result from such a scenario. Most of the major consumers of oil are
>> now countries that do not produce enough oil domestically and must rely
>> heavily on imported oil. These countries include the United States,
>> China, Japan, India, France and Germany. The competition that will occur
>> between these countries as they seek to align themselves politically with
>> the oil producing countries will likely cause unavoidable global tensions
>> that could conceivably cause substantial instability. That discussion is
>> best left to some future newsletter.
>>
>> In conversations I have with people about this topic, I get this sense
>> that the belief is that Saudi Arabia, Russia, Venezuela and other oil
>> producing countries could simply ratchet up their output to satisfy any
>> shortfalls. The truth of the situation, however, is that all these
>> countries are basically running all-out right now and have very little
>> excess capacity left and no genuine prospect of substantially increasing
>> output. I wrote a few months ago that the United States had not built a
>> new oil refinery in 30 years and none are currently on the drawing board.
>> Current refineries are running well over 90%+ capacity already. For
>> these
>> reasons, even the slightest interruption in the oil markets (hurricanes,
>> wars, political squabbles) will instantly impact the price of oil. This
>> resulting volatility will have a damaging effect on consumer sentiment
>> and
>> confidence.
>>
>> Certainly there can be improvements in technology and conservation
>> efforts
>> that could smooth the transition from fossil fuels to alternative
>> sources,
>> and while many of these are viable alternatives, none of them are going
>> to
>> be ready in an adequately fast period of time. Since necessity is almost
>> always the mother of invention, it won't be until the environment of
>> higher priced oil appears permanent that consumers and governments will
>> commit themselves to changing their lifestyles. At that point it should
>> take the better part of a decade for the changes to truly begin to be
>> implemented and take effect: Making for a pretty miserable decade.
>>
>>

Re: oil, the truth hurts..

There are HUGE reserves (more than is in Saudi Arabia) in tar sands and
in oil shale. So far, no one has been able to economically extract this
"oil". But yes, eventually we will HAVE to find some other source of
inexpensive energy you can carry in a bucket (or battery can), or our
lifestyles are going to change drastically.

No one really knows how long we have until we are drastically effected
or how much oil there is in the ground. There is still quite a bit
under the ocean also. Estimates run from 50 years to 200 or more.

One other item, though I don't know where this research is at the
moment. There is a theory that natural gas MIGHT be being created in
the earth's core. If this is true (and again I don't know), that would
be signifigant.

There is a small chance of discovery of substantial reserves in the
Antartic or under the oceans that could provide decades of oil for the
world.

Personally I think solar and nuclear are going to be the answer, which
means we will run our cars on electricity. What else is there?

This planet is a pretty fragile place and signs of human population are
almost everywhere. Only in the far north of Canada and Alaska and
Russia and the Antartic is it void of roads, fences, buildings or some
other indication of human activity from a plane flying 1000' above
(with occasional pockets of yet remaining protected wilderness).

It does make you wonder.

Still, when you consider that Germany is the size of Colorado and has
80 million people, yet Colorado has only 4 million, it does make you
realize there IS room for quite a few more people. Though the thought
of my beloved Colorado having anywhere near that number of people is
HUGELY discouraging. (And Wyoming, which is about the size of Colorado,
has only 1/2 million).

I guess somehow we will manage....until we don't. And no one knows when
that will be. Might as well be optimistic. All other options are too
depressing. I suspect our civilization will be here for many more
centuries in one form or another. And my descendents will be part of
that. I guess thats somewhat comforting.

Re: oil, the truth hurts..

There is a lot more water than people think. HUGE amounts of unused
water up in Canada and northern Russia as well as Alaska. I'll admit,
we have a transportation problem, but there is PLENTY of water. Heck
the earth's surface is MOSTLY water (though I'll admit economic
desalination is an unsolved problem). Water we have.

Re: oil, the truth hurts..

The doom and gloom faction has a significant anti USA membership. And of
course, there will be higher prices given higher demand. There will be
plenty of energy for everyone.


"Doug" <> wrote in message
news:
> There are HUGE reserves (more than is in Saudi Arabia) in tar sands and
> in oil shale. So far, no one has been able to economically extract this
> "oil". But yes, eventually we will HAVE to find some other source of
> inexpensive energy you can carry in a bucket (or battery can), or our
> lifestyles are going to change drastically.
>
> No one really knows how long we have until we are drastically effected
> or how much oil there is in the ground. There is still quite a bit
> under the ocean also. Estimates run from 50 years to 200 or more.
>
> One other item, though I don't know where this research is at the
> moment. There is a theory that natural gas MIGHT be being created in
> the earth's core. If this is true (and again I don't know), that would
> be signifigant.
>
> There is a small chance of discovery of substantial reserves in the
> Antartic or under the oceans that could provide decades of oil for the
> world.
>
> Personally I think solar and nuclear are going to be the answer, which
> means we will run our cars on electricity. What else is there?
>
> This planet is a pretty fragile place and signs of human population are
> almost everywhere. Only in the far north of Canada and Alaska and
> Russia and the Antartic is it void of roads, fences, buildings or some
> other indication of human activity from a plane flying 1000' above
> (with occasional pockets of yet remaining protected wilderness).
>
> It does make you wonder.
>
> Still, when you consider that Germany is the size of Colorado and has
> 80 million people, yet Colorado has only 4 million, it does make you
> realize there IS room for quite a few more people. Though the thought
> of my beloved Colorado having anywhere near that number of people is
> HUGELY discouraging. (And Wyoming, which is about the size of Colorado,
> has only 1/2 million).
>
> I guess somehow we will manage....until we don't. And no one knows when
> that will be. Might as well be optimistic. All other options are too
> depressing. I suspect our civilization will be here for many more
> centuries in one form or another. And my descendents will be part of
> that. I guess thats somewhat comforting.
>

Re: oil, the truth hurts..

>>> So, you can bury your collective heads in the sand if you want to.

I was at local coffee shop last night and subject of
Peak Oil came up among people setting there (didn't
come up by me)

Anyway..... there was retired engineer from IBM there.
This is his "version" of Peak Oil and the future:

He says that Peak Oil is to not be feared. And that in
many ways it may bring GOOD changes.

Example... it may come to pass that jobs may come BACK
to the US since it will cost too much to have many
products made overseas and the shipped BACK for sale.
His vision is that small and highly customizable
factories could locate right in your own back yard.

You need a pair a jeans you say? then they will be
made in real time to your exact body measurements...
and made in a factory CLOSE to you to reduce shipping
costs and energy use in transportation. etc, etc....

He also thinks that nanotechnology could bring abt a
lot of this "re-industrialization". Things will be
"grown" rather than "made"

example..... you spray some nano-bots on the side of
your house.... and they assemble themselves into cheap
solar panels that produce electricity.

Ill stop for now.... but these were some examples he
had and actually they made sense.

so it 'could " be possible that we can "invent" our way
out of oil based economies to some degree? And that
GOOD things could happen in the proicess?

Re: oil, the truth hurts..

NoEd wrote:
> The doom and gloom faction has a significant anti USA membership. And of
> course, there will be higher prices given higher demand. There will be
> plenty of energy for everyone.

Err, you left out that part of your argument that would have explained
how and why there will be plenty of (read cheap) energy for everyone.