happycajun

Laying the Foundations for a Post-Oil Age Economy

Huhhhh? Ever been to London? Yep, well laid out..... What IS the post oil economy? I thought that technology will make energy cheap, clean and abundant - which means attempts to further concentrate populations into potential death traps for natural or manmade plagues won't be driven by energy. And further, if you further concentrate population, who will produce all of the food (and renewable energy) that these slums will need? Waste disposal? Crime? An what about all of the existing "sprawl?" Do you advocate what the dicatator Napoleon did in Paris - bulldoze the whole thing and start from scratch? Sounds like you are a "mass transit" agenda guy, and you don't address what all those sheep in the superherds will be doing for a living. I thought that all this technology was to enable telecommuting and such. Indeed, I work all over the globe frome whereever I am. I thought that one of the environmentally sustainable trends was to consume locally produced "stuff" rather than to ship crap from Hong Kong to NYC for consumption of "fresh" produce. Sounds to me like you need to do a little more work on problem definition before you launch your "foundation" for the Oil Free (ha!) future.

Peak Oil as a Function of Earth's Volume

This is hilarious! Are you a "strategic planner" for the DOE perchance? LOL!

Oil Futures: Money for the Taking?

MarkitWacha - you are clearly not an oil patch kinda guy/gal - a barrel of crude is 42 gallons - interesting history of the "blue" barrel and early standardization of measure in the oil industry behind that conversion factor. As someone who has waded waist deep in A-Light crude, you'd have one hell of a clean up job, not to mention weathering loss (evaporation) and the risk of catastrophic conflagration (i.e., one hell of a fire).

Regards, HC

Oil Futures: Money for the Taking?

What? BB - I don't get the connection between your post and the article. I THINK that Andy's point is that, from a purely microeconomic perspective, there is a pure arbitrage play sitting here, and yet no one is taking advantage of it. Easy money - no way to lose.... Borrow $$ at low rates, buy oil at today's price, sell future contracts at the mucho higher price, and hold the oil until the contract comes due. The macro picture you describe has nothing to do with this equation.

My thoughts as to the WHY behind Andy's very astute observation is that the storage cost is higher than he thinks - We see numerous mentions of crude inventories being at very high levels, which I think is an indication that arbitragiers are indeed at work. So much so, that storage capacity is getting max'ed out. Building new capacity will take too long and be risky in the longer term. The oil producers can keep oil in the ground rather than pruduce it, pay royalties and taxes and then store it. The largest oil storage facilities are in salt domes, mostly owned and operated by the U.S. Govt in the SPR. Other than this capacity, the amount of oil storage capacity as a percentage of production capacity is relatively small. In Saudi Arabia, home to some of the largest crude oil storage tanks in the world - total tankage is only about two or three days worth of production capacity.

Andy, I think the answer is that unused storage to do what you describe just ain't there and the lead time to build more is greater than the market's perception of when the price will snap back.

Regards, HC

Can Saudi Arabia Push Down the Price of Oil?

NICE THEORY! Don't know how they will get the oil back to ol' earth? Details my boy, details. Now, could I interest you in a ground floor opportunity to buy in to MarsACo - easy money - soon we'll have intergalactic supertankers cruising the channels of space... like totally dude.