perceptions_now

Is the Other Oil Shoe Dropping?

Agreed!


On Nov 25 06:20 PM Gary A wrote:

> The dollar was creamed today. This could get disorderly.

Is the Other Oil Shoe Dropping?

Agreed!


On Nov 25 03:47 PM Dave Wrixon wrote:

> Yes, the other shoes is dropping. Oil won't be priced in dollars
> for much longer.

25 Reasons We Will Not Have a Depression

World Energy, Population, Economic Trends

Oil
Timing - Crude oil production peaked in May 2005 and has shown no growth since then despite dramatic surges doubling in price and in exploration activity.
Decline Rate - The US has been in decline since 1971. The giant Cantarell field in Mexico is losing production at rates approaching 20% per year.
Globally, the annual decline rate is around 5%.
The Net Export Problem – As higher Oil prices stimulate Oil Exporters economies, they are using more Oil internally, thus reducing the amount of Oil for Export.

Natural Gas
The supply situation with natural gas is very similar to that of oil. While oil and gas will both exhibit a production peak, the slope of the post-peak decline for gas will be significantly steeper. As with oil, we found and drilled the big ones first. The peak of world gas production may not occur until 2025, but two things are sure: we will have even less warning than we had for Peak Oil, and the subsequent decline rates may be shockingly high.

Coal
The ugly stepsister of fossil fuels. It has a terrible environmental reputation. Most coal today is used to generate electricity. Coal may also Peak in around 2025.

Nuclear
Given their usual lifespans, many reactors are nearing the end of their useful life. Given the likely level of decommissioning and of proposed new reactors to be built, it is likely that we have already seen the Peak of Nuclear power.

Hydro
If coal is the ugly stepsister, hydro is one of the fairy godmothers of the energy story, this form of energy production may be set to increase

Renewable Energy
While I do not subscribe to the pessimistic notion that renewables will make little significant contribution, it's equally unrealistic to expect that they will achieve a dominant position in the energy marketplace. This is primarily because of their late start relative to the imminent decline of oil, gas and nuclear power, as well as their continued economic disadvantage relative to coal.

Fossil Fuels have been by far the most important contributors to the world's current energy mix, but all three are set for rapid declines, whilst Hydro and renewables are set to make respectable contributions.

In an overall context, this shortfall contains an ominous message for our future, Energy shortages are coming!


The Effect of Energy Decline on Population
Human population growth has been enabled by the growth in our Cheap & Abundant energy supply.

The Historical and Current Situation - The world's population has increased by a similar amount in that time, from 200 million in 1 CE to 6.6 billion today. There is of course a great disparity in global energy consumption. The combined populations of China, India, Pakistan and Bangladesh (2.7 billion) today use an average of just 0.8 toe (Tonnes of Oil Equivalent) per person per year, compared to the global average of 1.7 and the American consumption of about 8.0.
Long-Term and Aggregate Effects - The net oil export crisis may well be the defining geopolitical event of the next decade.


The Population Model - It is likely that things such as major regional food shortages, a spread of diseases due to a loss of urban medical and sanitation services and an increase in deaths due to exposure to heat and cold.

Effects of Ecological Damage
There are two ecological concepts that are the keys to understanding humanity's situation on our planet today. The first is Carrying Capacity, the second is Overshoot.

Carrying Capacity – The carrying capacity of an environment is established by the quantity of resources available to the population that inhabits it. The usual limiting resource is assumed to be the food supply.

Overshoot - Populations in serious overshoot always decline. This is seen in wine vats when the yeast cells die after consuming all the sugar from the grapes and bathing themselves in their own poisonous alcoholic wastes. Another example is the death of the oceans, where 90% of all large fish species are now at risk, and most fish species will be at risk within 40 years.

As our supply of energy (and especially that one-time gift of fossil fuels) begins to decline, this mask will be gradually peeled away to reveal the true extent of our ecological depredations. As we have to rely more and more on the unassisted bounty of nature, the consequences of our actions will begin to affect us all.
It is impossible to say with certainty how deep into overshoot humanity is at the moment. Some calculations point to an overshoot of 25%, others hint that it may be much greater than that.

Conclusion
All the research I have done for this paper has convinced me that the human race is now out of time. We are staring at hard limits on our activities and numbers, imposed by energy constraints and ecological damage. There is no time left to mitigate the situation, and no way to bargain or engineer our way out of it. It is what it is, and neither Mother Nature nor the Laws of Physics are open to negotiation.
We have come to this point so suddenly that most of us have not yet realized it. While it may take another twenty years for the full effects to sink in, the first impacts from oil depletion (the net oil export crisis) will be felt within five years. Given the size of our civilization and the extent to which we rely on energy in all its myriad forms, five years is far too short a time to accomplish any of the unraveling or re-engineering it would take to back away from the precipice. At this point we are committed to going over the edge into a major population reduction.

We need to start now to put systems, structures and attitudes in place that will help them cope with the difficulties, find happiness where it exists and thrive as best they can. We need to develop new ways of seeing the world, new ways of seeing each other, new values and ethics.
Link –
www.countercurrents.or...
================
I have edited & abbreviated the above article to make it more readable, as it is quite long. That said, I recommend it be read fully & that the relevant graphs be examined, as it certainly provides some strong pointers for the future direction of Market segments, entire markets & beyond!

We often hear the phrase “Market Fundamentals”, you can not get any more fundamental than the information contained in this article. But, of course there are also numerous other Factors which will impact on the future, including the relatively recent massive increases in Private & Government DEBT & the relationship of the DEBT to GDP Ratio, as well as other very significant factors!

However, some issues in the article where I am not in full disagreement, but I believe this article is fairly close to one possible reality and all that goes with it.

There may be other possible Realities!

Meredith Whitney: 'I Haven't Been This Bearish in a Year'

A couple of thoughts -
1) If proper asset valuations were applied to banks today, it is likely that very large numbers of Banks would be Bankrupt!
2) Forgetting the Wall Street/Establishment "smoke & mirrors", where & how is the consumer going to rebound on Main Street?
3) Have enough Mum & Dad investors been sucked in yet?

Has the U.S. Been Playing Loose with Oil Market Data?

The Implications and Fallout of the IEA "Leaks"

After the Recession, Will the World Face an Energy Crisis?

Here's the bad news about the global recession's potentially coming to an end: the recovery could spark a massive energy crisis with increased demand for fossil fuels from China and other developing countries, tighter oil supplies and skyrocketing oil prices. And this is just in the near future. The longer-term picture looks even more daunting.

Too fearful to publicise peak oil reality

Take the 2008 edition of World Energy Outlook, the annual report on which the entire energy industry and governments depend. It included the table also published by the Guardian today, and the version I saw had shorter intervals on the horizontal axis. What it made blindingly clear was that peak oil was somewhere in 2008/9 and that production from currently producing fields was about to drop off a cliff. Fields yet to be developed and yet to be found enabled a plateau of production and it was only "non-conventional oil" which enabled a small rise. Think tar sands of Canada, think some of the most climate polluting oil extraction methods available. Think catastrophe.
Link -
www.chrismartenson.com... d-fallout-iea-leaks/31343
==========
The author of this article, Chris Martenson, knows what he is talking about and no just about Peak Oil!

The above is only a small portion, I reccommend the full read!

Is the U.S. Headed Down the Same Path as Japan?

It is correct to say that the US today is different to the Japan of 1990-2009

However, and risking the possibility of graphics overload, there are some interesting graphs at the following site -
georgewashington2.blog...

That said and whilst there are differences, there are also some similarities. Yes, Population Aging is a common factor and Yes, Real Estate & Share Market declines are also common factors.

In terms of differences, the Japanese were the Canary in the Mine, they were the first to experience this modern population Aging & subsequent decline, so outside intervention & assistance was possible. And, whilst they were & still are a large Global economic player, they were not like the US, the largest Global economic player, by a long, long way!

Also, the Japanese only had to fight off the loss of one major economic driver, that being the Aging of their Population and the subsequent Population decline. In the current event, the US & the rest of the Planet, are facing similar population issues, but now there is the added dimension of losing the 2nd of the three major economic drivers, that being the loss of a Cheap & Abundant source of Energy, Fossil fuels if you will, Oil in particular.

The is no doubt a great deal of disagreement on this issue, but the Conventional Production/Extraction of Oil has effectively Peaked in 2005, as since then it has failed to keep up with Demand, Inflation & Population Growth!

Events are seldom simple repeats of history and this event is no repeat of Japan in the Nineties.

Whilst some of the inputs may seem similar, when viewed with historical 20-20 vision, the current event outcomes will clearly be a once in history event

JP Morgan Invents New U.S. Employment Numbers

Clearly, the what, When, How & Where of consumption can & is manipulated, including by government & other "statistics"!

That said, no matter how things are put, how they are manipulated, what "smoke & mirrors" are applied by marketers/advertisers/ big business/ unions/politicians or those of self interest in Oil, some facts remain facts.

To that end, it would not be possible to make consumers consume as much, IF it became clear to the general public that the global economy was on a downhill slide, with no way of returning to the status quo.

Oil is a good example here, as Demand can require that the Pacific Ocean be made to be the new supply Crude Oil. But, Reality says, no matter how much desire/want or dissatisfaction we create in the general public, the Pacific Ocean will not turn into a giant pool of Oil!

In fact, it is often in the area of finite resources, where I have seen the Population and consumption per head, at today's level put into reverse, with the argument that there is actually plenty of OIL, at today's level of consumption, when it is plainly obvious that those levels of consumption will increase, over time.

Finally, my advice is to beware, there are Lies and statistics and there are damned lies & government statistics!

An Interesting Tidbit Regarding Oil Supply

Just like Goldilocks, too much Oil is a problem, not that there is too much Oil and too little Oil is also a problem!

It appears that the best current outcome for the Country Producers, the Oil Majors, the Oil Markets, Investment Bankers, Politicians, the establisment & other self interested party's, is to sow the seeds of absolute confusion.

However, if the levels of reserves REMAINS UNKNOWN, UNVERIFIED & SUBJECT TO CONSTANT CONCERN, then
the result is as usual where Demand appears to exceed Supply, there is constant pressure on the Price of Oil to rise!
This is THE PREFERRED OUTCOME for the major self interest groups!

There are no guarantees in life, but the likely outcomes suggest that in 5-10 years, the Global Economic outlook, will be significantly different to today and I am not talking of upside!

The Global Oil Scam: 50 Times Bigger than Madoff

Let me say, there is no doubt that "financial games" are being played by participants, at all points of the Energy (Oil) trail.

That said, there are some basic information, which suggest future trends, including -
1) Oil is a Finite commodity.
2) Global Population will continue to expand until at least 2030-2040, as will demand for Energy.
3) It is likely that the "Extraction/Production" of Oil effectively Peaked in 2005, as it has subsequently failed to keep pace with Inflation, Population Growth & Demand.
4) The Depletion rate of "Extraction/Production" over the next 20 years will exceed that rate at which new supplies come online, either in the form of conventional Oil from Deep Seas or Artic or from Unconventional, in the form of Canadian Tar Sands or Shale Oil. It should be noted that the EROEI on these new forms of supply, are much lower than the old super fields.

In my opionion, the existing Economic/Political establishment will use every avenue at its disposal, to retain the status quo, as long as possible.

Notwithstanding the establishment’s best efforts, it is likely, in the not too distant future, after several more Oil Related Financial shocks, that OIL/FOSSIL FUELS will cease to be perceived as THE VIABLE GLOBAL ENERGY SOURCE! These shocks will of course be accompanied by further collapses in Share Markets and the Real Economy.

When that time comes, there will be a Tectonic shift away from the OIL/FOSSIL FUELS sector, as capital pours into a desperate search for alternative Energy sources.

As this occurs, investment in Exploration & New Technology for the OIL/FOSSIL FUELS sector will be decimated, causing the DEPLETION RATES for the OIL/FOSSIL FUELS sector to escalate rapidly.

The upshot of all of this is that both $20 & $200 are possible and may happen several times, over the short to medium term!

IEA Whistleblower: Governments Underplaying Peak Oil

Peak Oil has already passed into history, as since 2005 Oil production has not effectively kept up with inflation, Demand or Population Growth.

Whether it is the IEA, EIA, Politicians or self interest groups, the establishment is now into preservation of the status quo, at any cost!

Misinformation and smoke & mirrors are now a major part of the armory, just as it was/is in the tobacco industry campaign!

Ghawar, Burgan, Cantarell, the OLD SUPER FIELDS are now on the decline. The NEW SUPPLIES, such as Canadian Tar Sands, Shale, Deep Water & Artic Crude are mainly years away and their EROEI is much, much lower than the old super fields and their ENVIRONMENTAL IMPACT WILL BE MUCH GREATER.

There are many scenario's that may play out, regrettably most of them, may not have Hollywood endings?

Don't Believe Long-Term Oil Forecasts: Part II

Sorry, that link in the previous post didn't seem to be working, let's try this?

www.guardian.co.uk/env...


On Nov 10 05:30 AM perceptions_now wrote:

> Key oil figures were distorted by US pressure, says whistleblower
>
> Exclusive: Watchdog's estimates of reserves inflated says top official
>
>
>
> The world is much closer to running out of oil than official estimates
> admit, according to a whistleblower at the International Energy Agency
> who claims it has been deliberately underplaying a looming shortage
> for fear of triggering panic buying.
>
> The senior official claims the US has played an influential role
> in encouraging the watchdog to underplay the rate of decline from
> existing oil fields while overplaying the chances of finding new
> reserves.
>
> In particular they question the prediction in the last World Economic
> Outlook, believed to be repeated again this year, that oil production
> can be raised from its current level of 83m barrels a day to 105m
> barrels. External critics have frequently argued that this cannot
> be substantiated by firm evidence and say the world has already passed
> its peak in oil production.
> Link -
> www.guardian.co.uk/env.../ peak-oil-international...
>
> ==========
> One more nail in the status quo coffin!
>
> Whilst miracles can still happen, I am of the opinion that the status
> quo will not go down without a fight!!
>
> You can expect "smoke & mirrors" all the way, those with self
> interest in the status quo, including politicians will fight every
> inch of the way, with everything at their disposal!!!

Economic Recovery Is Here; The Real Problem Is Financing

"The real problem is financing"

TJ,
I've heard that comment applied to Energy (Oil) as well. If we can throw enough "Money" at the problem (falling Oil production/reserves), then "people" guarantee more Oil will be found & produced.

You know, I have a real hard time accepting that line of thinking on Oil & for the current financial slowdown.

Why? Because no matter how much money gets thrown at Oil, the mighty US$ will never MAKE A SINGLE GALLON OF OIL!

Why? Because no matter how much money you throw at the current economic slowdown, the mighty US$ will never be able to replace 2 of the 3 major Global economic drivers, which have recently Peaked, those being Oil & Population Growth.

The only possible salvation is INNOVATION!

But it would take a miracle in time, which is so short and in pulling rabbits from hats, because such a major innovation is not currently on the radar!

Tighten or Ease Rates?

A. That depends on your goals!

Q. Why did Alan Greenspan leave rates so low, for so long after 9/11?

Don't Believe Long-Term Oil Forecasts: Part II

Key oil figures were distorted by US pressure, says whistleblower
Exclusive: Watchdog's estimates of reserves inflated says top official


The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.

The senior official claims the US has played an influential role in encouraging the watchdog to underplay the rate of decline from existing oil fields while overplaying the chances of finding new reserves.

In particular they question the prediction in the last World Economic Outlook, believed to be repeated again this year, that oil production can be raised from its current level of 83m barrels a day to 105m barrels. External critics have frequently argued that this cannot be substantiated by firm evidence and say the world has already passed its peak in oil production.
Link -
www.guardian.co.uk/env.../ peak-oil-international...
==========
One more nail in the status quo coffin!

Whilst miracles can still happen, I am of the opinion that the status quo will not go down without a fight!!

You can expect "smoke & mirrors" all the way, those with self interest in the status quo, including politicians will fight every inch of the way, with everything at their disposal!!!

Why Are Markets Rising When Unemployment Is Soaring?

There is an expectation in some quarters that the old status quo will re-emerge at some point and that unemployment will fall & profits will rise?

That will & in fact, can not happen!

The old paradigm has gone the way of the Dinosaurs and like the Dinosaurs, our Economic & Political systems have outlived their allotted time, we just don't yet KNOW IT!

THERE WERE THREE MAJOR ECONOMIC DRIVERS, POPULATION GROWTH, CHEAP & ABUNADANT ENERGY & INNOVATION, of those only INNOVATION REMAINS A VIABLE CONTENDER.