Kezorm

Americans Forget High Oil Prices Too Quickly

"That said, what we really need is fair government that implements capitalistic policies for the benefit of the many, not of the few."

When I voted in November, the type of wish you expressed above is what I was voting for. I picked the candidate who I thought most likely to deliver it. Here are some excellent, early signs:


www.reuters.com/articl......

Obama vows strong new financial regulations

Sun Dec 7, 2008 11:06am EST

WASHINGTON, Dec 7 (Reuters) - U.S. President-elect Barack Obama said on Sunday he would put strong new financial regulation at the center of his economic recovery program to force more accountability on the banking industry.

Obama again warned that the U.S. economic crisis, which saw the country lose more than half a million jobs in November alone, would worsen before it gets better.

"As part of our economic recovery package what you will see coming out of my administration, right at the center, is a strong set of financial regulations," Obama said in a taped appearance on NBC's "Meet the Press" television show.

"Banks, ratings agencies, mortgage brokers, a whole bunch of folks (will) start having to be much more accountable and behave much more responsibly.

"We've got to have transparency, openness, fair dealing in our financial markets and that's an area where I think over the last eight years we've fallen short."

end excerpt

How about that last line for a polite understatement? :)

Why I'm Not Buying Oil's Recent 'Correction'

Quick comments:

Russia just increased export tariffs on crude to $70/bbl. Given the enormous output of Russian crude, this number has got to be part of the equation for calculating a new price floor. After all, $70 is just the tariff.... It does not include lifting, profit, or shipping.

Saudi Arabia and Libya have threatened or promised to slash production if oil fell too far, too fast. Although I do not recall a "strike price" being stated, I'd guess they would defend at $100/bbl or so.

The USA crude oil demand experiences very consistent seasonal variations and we are at the second of two predictable summer minima. From the fourth week of July, till the last week of September, demand traditionally builds. Expect this effect to exert itself, even if other political factors overlap.

Abiotic Oil? It is fascinating that the famous Brazilian prospect called Sugarloaf or Carioca will be the subject of exploratory drilling by Seadrill's West Polaris, on behalf of XOM, HES and PBR over the next year. The particular block being drilled is BM-S-22. The basement structure which is responsible from producing this particular hydrocarbon target is a failed spreading center related to earlier rifting tween SA and Africa. Two miles of salts overlie the old rifting center. See this site: www.searchanddiscovery...
Combine this especially attractive prospect with the recent news about abiotic hydrocarbons found at the Lost City Hydrothermal field, and one is forced to wonder if the massive Brazilian sub-salt reservoirs might be created by inorganic reactions between water and ultra-mafic rocks.

In Light of Peak Oil, Financial Diversification Is a Bad Idea

Hmmm. The S&P 500.... While I am very long oil and minerals, I strongly suspect that the S&P 500 might be a sleeping giant about to awaken. If you look at USA manufacturers who have been profitable in the past few years, just imagine how further declines in the value of the dollar will provide a hurricane-like tailwind. Anyone who recalls the Bucyrus-Erie company in the 1960's would probably classify it as a quintessential rust-belt company. But look at it today! And realize that Milwaukee/Southern Wisconsin has dozens more companies just like that one. So, the falling dollar is not all bad. It just might be restoring an imbalance that sent too many jobs overseas. In fact, when viewed in that weird glow of the falling dollar, the diverse and dynamic USA economy begins to look more and more like Brazil... After all, we have great mineral wealth, monster agriculture, high-tech, excellent infrastructure, and probably also a bounty of energy supplies that have been wisely protected from development under a probably false ecological pretense. So, keep a keen eye on the S&P 500 and especially those that export goods. As the dollar sets, it may rise.

An Energy Policy That Makes Sense, Revisited

To Poet1, concerning how much crude oil is or is not available on Alaska's north slope:

See this rather unusual discussion on youtube:

www.youtube.com/watch?...

I would be very interested in hearing what everyone thinks of Mr. Williams report.

An Energy Policy That Makes Sense, Revisited

Reply to mickel98,

"yet there are nearly no engineers in leadership."

Yes, I know you said "nearly no engineers", but I thought I'd paste this link anyway:

bartlett.house.gov/Bio.../

Congressman Bartlett has been beating the drum about energy scarcity issues for a long time. I've seen him on C-Span and he is as knowledgeable as anyone about Peak Oil. Here is a link to his page on energy policy. (Note the Hirsch report, which is must reading.)

bartlett.house.gov/Iss...

Maryland should be very proud to be represented by someone with such excellent and varied credentials.