longoil

Forget $100 a Barrel - Oil Will Plummet to $30

Jason,

Like everyone else who promotes a hydrogen economy, you have overlooked the complex storage and transport infrastructure issues. Hydrogen not only has a negative EROI but has many infrastructure and storage issues. Not only does its small atomic size cause it to leak very easily, it is very reactive with most metals. It low density makes it very uneconomical to tranport by truck. A tractor trailer that can carry 22 tons of gasoline, can only carry 1000 lbs of hydrogen in liquid state. Conventional pipelines cannot be used due to leakage and corrison by hydrogen gas.

Both Obama and McCain have no energy policy at all and are pandering for votes. Obama is promoting corn ethanol and imposing windfall taxes and removing E&P tax credits. This will cause food prices to continue to rise as well as reduce oil production and drive oil prices even higher (remember Jimmy Carter in 1980). McCain with his ANWR and USC drilling plan will only provide 4 yrs of oil at most, certainly not a long term solution.

The only thing I agree with you in your article is the potential of T. Boone Pickens's wind farm project.

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

Brian,

The CERA bunch are "very credible" in regards to peak oil.
Let's see what they have predicted in the last few years:

2002 CERA predicts: Gas production up 15% by 2010
==> Reality: Gas Production is flat into 2008.

2003 CERA predicts oil will drop to low to mid $20
==> Reality: Oil = $31

2004: CERA predicts oil will hit high 20's or low 30's thru to 2005
==> Reality: Oil = $65

2005: CERA predicts oil will drop below $40 for 2007-2008
==> Reality: Oil = $57

2007: CERA predicts oil will drop to $60's by 2008
==> Reality: Oil peaks at $147 and is flat at $125 by mid-2008

Daniel Yergin and his gang at CERA should get a better crystal ball.

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

Biogeneic oil and Peak oil theories have been peer reviewed and accepted by the vast majority of the world's scientists.

I have a hard time accepting Abiotic oil, a theory advanced by Stalin endorsed scientists.

Jean Laherrerre (a world famous petroleum geogolist) dismisses Abiotic oil point-by-point in the following article:

lawnorder.blogspot.com...

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

Biogenic oil theory states that most oil will be found between 7500 and 15000 ft. The distribution of oil finds is a Gaussian curve centered at 11250 ft. Oil is still found (but less likely) on the tails of the Gaussian curve (i.e above 7500 ft and below 15000 ft.)

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

Mark Barath said "But to restate my main point, prices don't rise forever. Although oil prices are very inelastic, consumer habits can changes, alternatives can be found, and more oil can be drilled."

Your statement is correct, but according to the BP Statistical Survey of World Energy 2007, 87% of the world's energy still comes from fossil fuels (i.e. oil, coal, gas, etc). There 500 million cars in world and most of them are either gasoline or diesel powered. A substantial conversion to alternative energy forms will take at least 30 years.

The current dip is oil prices is a buying opportunities for companies that are involved in exploration & production as well as oil field or deep sea drilling services. That's why I am long on oil.