bindlepete

Oil: Supply and Demand? Hardly!

Your really don't understand this market. There are not often single elements driving any decision out side of a coin toss and even these can be subject to influence.

Most decision are multifactorial from access to transport, price, currency fluctuations ones own perceived needs and on ad infinitum.

As to the supply side " peak oil' is a reality and inconvenient to acknowledge in our political system. China recognizes it clear and simple but then they have a different pattern of decision making. As to the many bbls you see coming on line it will be more than eaten up by declines in world production. Yes, even at $80 a bbl. with our dollar going down the porcelain pot hole.

Hey, it is finite and difficult to find and produce. The US does not control the world oil market it is a world market and the big locals have little interest in low prices and certainly not cheap as dirt alternative liquid fuels.

China is out there producing auto and diesel fuels from cola in the form of dimethyl ether and methanol. That is not permitted here as it would break the oil companies monopoly on feeding our liquid fuels addiction. Again China has a different decision making procedure.

Oil priceas will continue to bounce about but with a clear upward long term trend. Bet on it. I have and am not ashamed of my comfortable success.

I know you want a simple explanation but sorry all questions do not have human answers. Richard Belman taught me this back in 1970 over looking the Pacific.

We Still Have Oil. Plenty of Oil

This is silly. Sure the near term is not a problem unless someone triggers the Middle East such as a few stray bombs in Iran, an attack on one or several oil terminals or a coordinated simple shot at a few pipelines, or perhaps a set of active homing mines in the Straight of Hormuz from say North Korea.

In the intermediate term 1-5 years lots of oil about with the economy/demand in a steady fall if you can pay for access from the super deep deposits in the offshore or access the on shore deposits in Chad, Darfur, Uganda or central Asia and find the blood and treasure needed to bring it up and to get it to market. Plenty of oil out there.

In the longer term (10-30 years) well, finding it producing it and bringing it to use could become troublesome.

Timing and perspective my friend. Jimmy Carter was right.

Exxon's Hoard

This is bit of "happy talk" trying to revert the opinion that oil is really getting scarce. When did the good king Abdullah say " leave it in the ground? When did he tell G Bush we can not produce more because we don't have it ? The later statement was not a matter of a lack of production ability but the reserves are minimal.

As to Exxon itself it seems they are slowly shifting towards natural gas as a focal product and going to use LNG as a item to establish a high marginal price. The growing domestic NG industry such as CHK may not go along with this once they start to produce some of the " deep gas " aka geopressured.

But then all life is uncertian and subject to external forces.

What We Can Do To Reverse the Oil Crisis

As to conservation by zone heating with electric. A good idea but the New England electric grid couldn't handle it this winter. It will be down more than once if this tactic is followed by any substantial amount of households. Go chop wood. Be prepared with a small stove or move to Florida.

Sorry Charlie

Oil Price Impact in Perspective

In 1980 the issue of high cost oil was being addressed and " peak oil" was well understood by the policy makers. After Reagan who said no more on this issue "we want to be good trading partners" and killed all efforts to improve efficiency for short term gain, we lost all momentum for corrective action.

Now we are in high organic and our nation has increased vulnerability to a full scale, and perhaps uncorrectable, depression. Hyper inflation and a further destruction of a middle class may well be in the cards.

This is important if one has children or any sense of future welfare. We were given adequate warning but the "me now" world view of the Republicans have led us far into a dark tunnel.

Why $140/Barrel Crude is Unsustainable

Look there is still a lot of oil out there such as in the Darfur. The Barazilian strike may not work out and anyway it is a long way off. Natural gas is very plentiful and will displace a lot of petroleum on the domestic scene but what will really kick off a revolution will be EEStor's technology - if it comes to pass.

LNG although attractive to Exxon and ship owners as a setter of marginal price for gas is not going to be a factor without the Congress being purchased as it was for ethanol. Nixon tried this in the 70's but one big accident with flames, cities and a possible rapid phase transition demonstration and it too will be forgotten. It could make 9/11 look like a marshmallow roast.

Our petroleum and automotive addiction will be cured "cooling turkey" by price. With few exceptions the oil industry is in liquidation. Back to the tar sands and coal conversion to methanol and dimethyl ether like the apolitical Chinese.