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Why Peak Oil Demand Will Destroy Oil Prices

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Summary

Transportation fuels make up the large majority of crude oil consumption.

Increasing fuel efficiency and the improvements in electric vehicles will inevitably lead to demand destruction for the primary crude market.

Peak demand or stagnating growth will likely occur by 2030 and, as a result, oil prices will fall to the marginal cost of production.

Saudi Arabian strategy could already reflect this idea – leading to a desire to maintain low oil prices to reduce the risk of stranded assets.

Demand destruction in the oil (NYSEARCA:USO) markets will mean a slow and painful death for oil companies. Unquestionably, we are going to see rising demand for the next decade. However, there is an increasing likelihood that demand destruction will start to occur before 2030. A peak demand scenario will coincide with a significant and sustained drop in oil prices, and will usher in the next critical energy resources – whether that be gas, renewables, nuclear, or most likely, a combination of many.

I don’t believe that I will see a world without oil. But we can quickly analyze each sector and see that the biggest change is going to come from motor gasoline and distillate/residual fuels which make up a combined 59% of total products supplied. Jet fuel has no foreseeable replacement and will likely grow in consumption, LPG will remain stagnant, and the other uses of petroleum – of which there are millions – will continue to grow as we use it in everyday life. However, demand destruction in the primary market of transportation fuels will ring the peak demand bell.

Source: EIA

Changes In Technology

As we advance technology in batteries, more efficient cars, and as oil prices rose through to 2014, the western world had begun on a trajectory of decreasing consumption. Cars and trucks have been getting larger and more powerful, while increasing efficiency at the same time. If the trend of more powerful cars were to reverse, car companies could swiftly capture an increase in fuel efficiency. Europe has seen an even steeper rise in fuel efficiency than North America. European cars are on average smaller; Europe imposes tighter regulation and diesel is a large market. All of these factors lead to increases in fuel efficiency.

Source: United States EPA

Projecting outwards, nearly every major country in the world is regulating more efficient vehicles. Those countries expect to increase fuel efficiency by approximately 50% through to 2020. The recent Paris accord will put further international pressure to improving fuel efficiency through regulation. Furthermore, Toyota (TM) plans to eliminate gasoline-powered cars to a large extent by 2050, and Chinese authorities are pushing for more alternative vehicles as smog and pollution choke their populations.

Local governments in the world’s largest car market now have to dedicate 30 percent of their fleet purchase to battery-, hybrid-, and fuel cell-powered cars, and will lose fuel and operating subsidies if they fall short. The country’s State Grid is accelerating the roll-out of charging stations, according to state-owned media, and mobile-phone infrastructure owner China Tower is being recruited to the task – Bloomberg Gadfly

The Rise Of The Electric Car

One of the incumbents for gasoline cars is the very contentious topic of electric vehicles. Tesla Motors (NASDAQ:TSLA) has as many haters of the stock as it does avid proponents. One needs to look no further than the comments section on any recent Tesla article to see the rivalry that exists between shorts and longs. But, the technological advantage of electric cars over that of gasoline cars is insurmountable. Electric motors have incredible power to weight ratios, a torque curve that competes with the best ICE powered vehicles. Most of all, they are getting cheaper every day. The design of an electric car, apart from the battery, lends it to decreasing costs. With far less moving parts, the assemblies are less mechanically complex, economies of scale will push the price down to those competitive with its ICE brethren in the next 5-10 years. Tesla is trying to usher in the era of the electric car, a meaningful first step to reducing reliance on fossil fuels. Tesla has shown that an electric car can compete at the top of the line, now they must prove that they can compete with an economy priced car.

Win or lose; Tesla is likely to drive down costs for batteries. In turn, they will move the electric vehicle one step closer to cost competition. If Tesla is successful in creating a mass-market Model 3, that is cost competitive and contains all the benefits of electric vehicles; there will be a sudden movement by consumers away from ICE. Furthermore, advancements in renewable energy and cheap availability of gas could reduce the cost of electricity, increasing the attractiveness of changing over.

What Happens To The Value Of Oil At Peak Demand

At present, there is ample growth to come in crude oil demand. No one will be able to predict when demand will start to decline in earnest. Despite the uncertain timeline, the trajectory is clear. We will eventually reach peak demand, and the pace towards that outcome is hastening.

Peak demand will play out slowly. We are likely to see several years of flat-lining demand, while oversupply develops in the market. It will eventually become clear that demand destruction or stagnation has begun, and suppliers will need to fight with the only thing they can control – prices. A great comparison is the coal market.

There is, for argument’s sake, an infinite amount of coal. We will never consume all the coal available. It is now abundant, cheap, and margins on coal are small. Coal is rarely covered in the news anymore, but it still makes up a huge share of world energy production. In fact, peak production isn’t even the problem; coal demand is expected to grow 0.8% out to 2020.

Source: IEA Medium Term Coal Report

Coal was once the sole source of electricity supply. If you told someone 100 years ago, it would eventually start to die as an energy source they would have laughed at you. However, once the market comes to the realization that we have reached peak demand, there is going to be a massive selloff in correlated stocks. When predicting peak demand, a forecaster doesn’t even need to be that accurate. Low growth predictions can cause the price of a commodity to plummet. If coal prices start to rise again, supply can easily ramp up to meet demand. Market dynamics of ample supply, slow or no demand growth, eventuate in commodity prices falling to the marginal cost of production. This is now the market for coal, is increasingly becoming the market for iron ore, and will become the market for oil. Exacerbating the issue is that low prices lead to a drop in the marginal cost of production due to restructuring, a fight for efficiency, and better terms with counterparties.

Shale Oil And Saudi Arabian Strategy

A similar outcome will eventuate in oil, as shale oil can ramp up production over periods of months, rather than years. There is a substantial availability of transport capacity in the U.S. that will be sitting and waiting for rising prices. Shale oil also exists in abundance around the world, time should bring those supplies to bear on the market as well.

Oil, as with coal, will be around for many more decades. However, high prices are likely to come around just once more at most. A century of growth in oil demand will eventually recede. Once demand growth slows, suppliers will do what they always do in any oversupplied commodity market – enter into a price war and fight for survival. Stranded assets are worthless, and Saudi Arabian strategy, covered here and here, suggests they have already started to realize the impending attack from alternative energy, shale oil, and changing demographics. Despite the negatives, I am also confident I will continue to find petroleum companies priced attractively. At the moment, I see very few desirable companies based on my outlook, but that scenario is unlikely to last. We could be staring at the last big rally in oil prices or a permanent change in how the market works. Either way, the best decades for oil companies are behind us.

If you found this article interesting and would like future updates, head to the top of the page next to my name and hit follow. It is free, and allows me to continue to reach a broader audience and keep writing. Thanks for reading.

seeking alpha



47 Comments on "Why Peak Oil Demand Will Destroy Oil Prices"

  1. Mr. Pockets on Wed, 1st Jun 2016 2:52 am 

    didnt steve kopitz destroy peak demand theory a couple Januaries ago?

  2. pinkdotR on Wed, 1st Jun 2016 3:35 am 

    I would love to see peak oil demand before peak oil production because it would let the world go through the inevitable change the easy way. Yet I can only see higher and higher oil consumption every year. You say 2030. It is too late. It has to come faster to happen before peak oil production.

    Factors like increased fuel efficiency of ICE cars and more electric cars on streets are not enough/too slow to reverse the increase of (transportation) oil consumption. Peak oil demand can happen in case it is triggered by major economic crisis. It will not look like more EV cars and more fuel efficient cars but rather like reversed ratio of public/private transport use, moving from houses 50 miles from work to flats in walking/biking distance from work etc. People will not do this if they are not forced to by poverty or very high gas prices which will be the result of peak oil production coming before peak oil demand.

  3. Boat on Wed, 1st Jun 2016 4:59 am 

    pink,

    Peak oil demand will be the the effect of EV cars. I don’t see the suburbs going away any time soon. Schools, traffic, and crime are examples among many others that drive a decision to commute farther.

  4. makati1 on Wed, 1st Jun 2016 5:30 am 

    EV cars? Dream on. The burbs are dying. Not going to exist for many more years without public transport.

    Yes, they can die. Why not? Most occupants are one more economic collapse away from losing their homes anyway. Those stick, sawdust and plastic boxes will disintegrate in a few decades to noting but a pile of overgrown trash. Wait and see.

  5. makati1 on Wed, 1st Jun 2016 5:39 am 

    BTW: IF they could produce and sell 10 million new EVs every year, it would take 25 years to replace all of the regular cars in the US alone. But that is not true as the older EVs would need replaced before 25 years and would cut into the 10 million. You dream an impossible dream.

  6. Boat on Wed, 1st Jun 2016 5:49 am 

    mak,

    As usual you can’t keep up with the conversion. To cause peak demand only enough ev’s have to be produced to compensate for new demand. Get it?

  7. Boat on Wed, 1st Jun 2016 5:53 am 

    mak,

    You say that but it never happens. Reminds me of this story of a boy that called wolf.

  8. makati1 on Wed, 1st Jun 2016 6:57 am 

    Boat, ignorance is obvious in your comments. The is no new demand. The car dealers are giving 7 and 8 year loans to sub prime buyers because they cannot sell enough cars to keep in business. People are going broke.

    Deep debt is going to change the world radically in the next few years. Cars are going to be the toys if the rich, not the means for the average Joe to get to work. EVs are never going to be more than toys for techie wannabees. Like big trucks for are the choice of little guys.

    Be patient. The future I paint is coming. That or a war that will hit Us cities and take down the Empire. The Fed printing presses are smoking and making funny noises. China is devaluing the Yuan. The world is moving away from imperial control. It may take a few more years, but the 3rd world is coming to America. I’m planning for that day when all of the social safety nets dissolve and the 47 million Americans on food stamps take to the streets. Are you? It doesn’t sound like it.

  9. Revi on Wed, 1st Jun 2016 7:02 am 

    Cars are stupid anyway. It’s just our culture’s sacred cow. The way to move people around is some kind of tiny ev and trains. There’s no reason to push 5000 pounds of steel and glass around in order to get a jug of milk. People can’t imagine another way, so they insist that cars are the answer. Think of what people were saying in 1916. I’m sure they thought that cars would never take over. Railroads had their own stock classification. Coal was king. Oil was king of the last century, and maybe electricity will be the king of the 21st, but it will be generated with renewables mostly and it won’t be wasted on cars!

  10. Davy on Wed, 1st Jun 2016 7:03 am 

    There is no transition anymore. Oil cannot be substituted. The scale of a transformation and the scale of timing are no longer valid. We hit the end of that line of thinking with oil. We are 30 or more years past any kind of life extending change for modern man. There is no green’ing of modern lifestyles and attitudes they are not sustainable and never will be.

    The global system is built upon these failed modern lifestyles and attitudes. These lifestyle and attitudes are the backbone of our economic system through global production and distribution with economies of scale and global financial exchange. This is a well-oiled system that relies on confidence. It is not without a breaking point and we are ever closer to that breaking point.

    Talking about a transition and all the various substitutions for oil is a farce. To be fair it is probably all that we can expect of the world. We have a crisis at all levels including our own existential one. We have a crisis of identity and value. We are in a crisis of corruption and deception so how could we ever legitimately confront an issue as disturbing as one that says there is no future but collapse?

    We are going to muddle through destructive change in reactive destructive ways. We may see some good choices and luck but for the most part humans are a failure at the place we are now. We have already failed so now it is time to pay the price for failure and that is widespread death. That is the plain and simple skinny of it.

  11. ERRATA on Wed, 1st Jun 2016 8:28 am 

    http://phys.org/news/2014-01-ultra-high-volumetric-energy-density-lithium-sulfur.html

    “…is approaching the theoretical limit,”

    What is the theoretical maximum possible density of energy in the battery?
    Are attempts to build batteries with high energy density, are not the same “alchemy” as an attempt to create (invent) armored super-steel (much stronger than the current) conducted in the 50s of the twentieth century?

    You need to find an eminent specialist in the field of physics / quantum chemistry, to answer this question.

    1. http://phys.org/news/2014-01-ultra-high-volumetric-energy-density-lithium-sulfur.html
    2. https://en.wikipedia.org/wiki/Energy_density

  12. PracticalMaina on Wed, 1st Jun 2016 9:52 am 

    I have been looking into hyper-miling and modding ICE vehicles to get better fuel economy. I have seen a website where a man claims that he heavily modified a civic into a vehicle with a fraction of the drag coefficient of a conventional efficient vehicle. He claims this puppy can get him up to 100mpg. http://www.aerocivic.com/
    I may try something similar as I have a little beater car and do primarily highway. I get better mileage back roads because it is a standard and I coast hills, on the highway it is under powered because Detroit doesn’t really give a shit about aerodynamics at this time.

  13. JuanP on Wed, 1st Jun 2016 10:20 am 

    Get a bike! 😉

  14. JuanP on Wed, 1st Jun 2016 10:27 am 

    While I find it fascinating to speculate inside my mind about future oil production, future oil prices, and the future in general, I know that I have absolutely no idea how things will play out and that I am just playing mind games. I am always impressed by how certain some people are about the future, particularly optimists and ignorant people.

    The more I learn in life the more aware I become of the immensity of my ignorance.

  15. PracticalMaina on Wed, 1st Jun 2016 10:56 am 

    Cycling is not always practical in my area, winter storms, lack of shoulders on most back roads, ect. I did a lot of it as a teen, couple times I hit 100 miles in one day. I have been forced into a ditch by a careless motorist multiple times, trash thrown at me, I know several people who have been struck and ended up in the hospital. Tough to commute to work and go get groceries dealing with that kind of stuff. Unfortunately the reason it is unsafe to drive a cheap 1000 pound car is the same reason it is unsafe to cycle on certain roads at certain times, it is the other a holes out there!

  16. penury on Wed, 1st Jun 2016 12:03 pm 

    I see that “Seeking Alpha” found Omega

  17. shortonoil on Wed, 1st Jun 2016 3:46 pm 

    There is not enough economic activity generated from burning a barrel of oil to pay for the cost of producing the oil, and its products. Oil is used with the same efficiency as an internal combustion engine; which is 20.045%. 20.045% of its energy is converted into real work that has some economic value. The rest is released as waste heat.

    The value of a BTU in dollar terms has been going down for a long time:

    http://www.thehillsgroup.org/depletion2_008.htm

    To pay for oil, and its products takes more and more dollars as time progresses. A dollar buys fewer and fewer BTU over time, but the energy in a barrel of oil is constant. That is what is destroying the demand for petroleum. Demand is now the lowest it has been in the last 57 years, at 0.43% per year. EVs have absolutely nothing to do with destroying the demand for oil, and never will unless battery energy density can be improved by an order of magnitude. EVs are a social novelty and will remain so until they become the only alternative. By that time very few will be able to afford them.

    http://www.thehillsgroup.org/

  18. Outcast_Searcher on Wed, 1st Jun 2016 4:52 pm 

    SHortonoil said: “There is not enough economic activity generated from burning a barrel of oil to pay for the cost of producing the oil, and its products.”

    As though a Prius C gets far worse mileage than the typical car in the 70’s or 80’s. (NOT)

    As though CAFE standards and improving technology and efficiency for cars and heaters and industry didn’t exist.

    As though the energy intensity of first world economies generally and the US in particular weren’t steadily improving, and forecast to go on improving for a long time.

    As if people who could buy gasoline at roughly $4 a gallon can’t afford it at roughly $2 a gallon.

    It’s apparently easy to ignore reality if one is pushing financial advice, for a fee.

  19. makati1 on Wed, 1st Jun 2016 6:24 pm 

    Outcast, have you given ANY thought to why gasoline is NOT still $4 per gallon? Maybe because something major has changed, like an economic depression has set in and these same people can no longer afford even $2 gasoline?

    Have you ever really done research to see if the “efficiency” promoted by the corporations actually exists? The sticker on the window of a new car is full of lies called sales gimmicks. That is only one example. Those claims were based on trials under ideal conditions at best and not the real world. Typical for most claims by someone with something to sell. ‘Efficiency’ is a slippery word.

    I had a 65 Chevy Impala 396 Super Sport Convertible that would get less than 8 mpg, if I put the peddle to the metal, and a 1975 Chevy Impala 4 door sedan that got about 25 mpg on the interstate at legal speeds. Depends on use, not sticker (ad) claims.

    You tout a Prius in your example, but where does the electric come from to power it? (coal, oil, NG, nuclear) How much of that energy is lost between generation and the Prius battery? And, yes there is an energy loss over transmission lines and transformers according to a number of factors.

    How many barrels of oil did it take to get that Prius from the mines to smelters to factories, to dealer, to your driveway? Odds are, more than a normal car burns in it’s lifetime. Not to mention the oil it takes to recycle it after it dies.

    Hybrid/electric as an improvement over gasoline vehicles is not proven. Just a lot of suspect “sales gimmicks” for suckers so they feel good about their lust for a techie toy to show off to friends and neighbors. Another reason DEBT is killing the West today. LOL

  20. JuanP on Wed, 1st Jun 2016 8:26 pm 

    “The Limits of Oil’s Rebound” https://www.project-syndicate.org/commentary/price-ceiling-for-oil-by-anatole-kaletsky-2016-05

  21. JuanP on Wed, 1st Jun 2016 8:32 pm 

    Practical, I was talking with a local neurosurgeon last week who told me bikers victims of traffic accidents was one of the main causes of brain injuries in emergency patients in Miami, and that based on his experience he would advise against biking in Miami. He was quite emphatic about it.

  22. Kenz300 on Thu, 2nd Jun 2016 7:35 am 

    Electric cars, bicycles and mass transit are the future…..fossil fuel ICE cars are the past…………..

    Think teen agers vs your grand father…………………. cell phones vs land lines…….

    NO EMISSIONS……..climate change is real………

    Save money……no stopping at gas stations…..no oil changes……..less overall maintenance……

  23. JuanP on Thu, 2nd Jun 2016 9:13 am 

    I don’t believe in Peak Oil demand. Peak Oil is a real unavoidable issue. It is a consequence of biology, chemistry, physics, geology, and economy. At some point in time, which might be present, past, or, future we will produce more oil than everbefore or after that point. That point is called Peak Oil.

    The important thing to understand is that because of the low hanging fruit principle the quality of energy, mineral, environmental, and, biological resources available to humans is diminishing every second. The other important thing to understand is that we are increasing the number of humans in the planet by around 80 million per year. These two trends mean our current path as a species of continued growth in consumption of resources is totally and completely unsustainable and will, therefore, not be sustained.

    You can prepare, change, and adapt or suffer the consequences.

  24. shortonoil on Thu, 2nd Jun 2016 10:38 am 

    “SHortonoil said: “There is not enough economic activity generated from burning a barrel of oil to pay for the cost of producing the oil, and its products.”

    As though a Prius C gets far worse mileage than the typical car in the 70’s or 80’s. (NOT)”

    The gas mileage of a Prius has absolutely nothing to do with the cost of producing petroleum, and its products. When the cost of producing petroleum reaches a specific level the efficiency of its end use will have no bearing on its production. That will be because at that point there will be no production! When oil can no longer supply energy (because it requires all the energy that is in it, to produce it) that point will have been reached. That is a point on its boundary conditions. It is a wall, a barrier that can not be surmounted.

    When oil can no longer provide enough energy to run the pumps, drills, refineries, and distribution systems of the industry, it will no longer be able to supply oil. At that point there will be some where in the vicinity of 1,300 to 2,000 Gb of liquid hydrocarbons remaining in the earth. That is where they will stay.

    Unless that point is calculated there is no way of determining where it is outside of just using wild guesses. Unlike a new Spielberg movie it is not going to be advertized as a coming great attraction next month. But, an indication that it will be coming soon is that a lot of oil companies will be filing for bankruptcy, and oil producing nations will be collapsing.

    Seems like the news has been mentioning such things lately.

    http://www.thehillsgroup.org/

  25. Boat on Thu, 2nd Jun 2016 11:57 am 

    “SHortonoil said: “There is not enough economic activity generated from burning a barrel of oil to pay for the cost of producing the oil, and its products.”

    Beating that dead horse won’t bring it to life.

  26. shortonoil on Thu, 2nd Jun 2016 12:52 pm 

    “Beating that dead horse won’t bring it to life.”

    Nigeria no food, Venezuela no food, or toilet paper, Saudi Arabia pitching government bonds, US Majors seeing major losses, and hundreds of smaller producers expected to go bankrupt this year.

    When you are telecasting from Mars — its easy to miss the details.

  27. PracticalMaina on Thu, 2nd Jun 2016 1:13 pm 

    JuanP, interesting about the accidents, that sucks because other than the heat, it is a nice flat area with no real cold weather. With driver inattention due to cell phone use the number of those accidents are going to increase, a lot of people try using their peripherals when driving and looking at the phone, but that doesn’t work for noticing smaller objects.
    Boat, if I modify my 10 year old car to look like a teardrop I can get better mileage than any hybrid on the highway. The problem with new high efficiency vehicles is they are not bare bones raw function enough. A moped is, a bicycle is. Our car culture demands a house on wheels, that can do over 100mph.

  28. Boat on Thu, 2nd Jun 2016 1:27 pm 

    Some oil producers didn’t prepare for a prolonged glut of overproduction. Alan Greenspan calls this a darwinian flush. The strong will snap up the bankrupt and return bigger and stronger. This is capitalism 101.

  29. Boat on Thu, 2nd Jun 2016 1:33 pm 

    Practical,

    Lots of countries have bare bones transportation. Move there. Rickshaws would never work on a freeway.

  30. PracticalMaina on Thu, 2nd Jun 2016 1:45 pm 

    Boat you need a plug for your vibrator in your wheels huh?

  31. marmico on Thu, 2nd Jun 2016 3:04 pm 

    Oil is used with the same efficiency as an internal combustion engine; which is 20.045%.

    What a fuctard. ICE efficiency was relatively the same in 1960 as in 2016.

    EROI is relatively the same in 2016 as in 1960. Any net energy lost at the well head has been recouped with energy efficiencies in transportation to the refinery, processing at the refinery and distribution to end users. And the net energy consumed by the end user does 80% more work in 2016 as measured by miles per gallon.

    The ETP is a busted myth for innumerate doomers.

  32. shortonoil on Thu, 2nd Jun 2016 3:35 pm 

    “What a fuctard.”

    “Modern gasoline engines have a maximum thermal efficiency of about 25% to 30% when used to power a car. In other words, even when the engine is operating at its point of maximum thermal efficiency, of the total heat energy released by the gasoline consumed, about 70-75% is rejected as heat without being turned into useful work, i.e. turning the crankshaft.”

    https://en.wikipedia.org/wiki/Engine_efficiency

    If someone knows absolutely nothing, does that make them an idiot, or a moron?

  33. marmico on Thu, 2nd Jun 2016 3:39 pm 

    The ETP busted myth is about net energy to the ICE not the efficiency of the ICE you fuctard.

  34. Apneaman on Thu, 2nd Jun 2016 3:58 pm 

    marmi loses again.

  35. marmico on Thu, 2nd Jun 2016 4:36 pm 

    Bedford W. Hill is a fuctard. Like clockwork another innumerate doomer rings the bell of perdition.

    Bedford’s job today is to demonstrate empirically that there is less net energy being delivered from the well head today than Sam Walton’s gasoline tank in 1960.

    So let’s start. Some black goo was extracted in Ghawar, transported by pipeline to the Ras Tanura export terminal, loaded on a VLCC, then a Francis Drake voyage to the Houston Ship Channel, off loaded in Rockman’s backyard at the Baytown refinery, processed and then distributed to Bentonville.

    If there were 100 gross BTUs extracted in the Saudi desert, how many net BTUs are in Sam’s gasoline tank in 1960 and at Sam’s Club in 2016?

  36. JuanP on Thu, 2nd Jun 2016 5:04 pm 

    Practical, The heat is the only other issue besides the traffic danger as you pointed out. Riding electric bikes or mopeds helps because it’s like sitting in front of a fan, and possible even in summer. When I bike I try to stay out of streets by using the boardwalks and some of the canal side paths. This is quite possible in Miami Beach, but harder in Miami across the causeway. Rides are perfectly flat except for bridges down here. If it weren’t for the traffic risks biking here would be great.

  37. observerbrb on Thu, 2nd Jun 2016 5:07 pm 

    Marmico, it seems to me that your ass is on fire.

    I am sure you can have a meaningful argument with Mr. Hill and Mr. Rockman without resorting to insults and expletives.

    Regards.

  38. JuanP on Thu, 2nd Jun 2016 5:18 pm 

    Marmico “EROI is relatively the same in 2016 as in 1960.” Your lack of knowledge and understanding never ceases to impress. To claim that oil has the same EROI today that it had over 50 years ago proves that you just don’t know what diminishing returns and low hanging fruit mean.

    Marm, Make some preps before it is too late. When I started prepping I didn’t need to and didn’t expect to use my perishable supplies in an emergency. I didn’t, I ended up gifting to friends and donating to the Boy Scouts most of the long shelf life food we had. Whatever you believe in at least prepare yourself to help your family, friends, and neighbors when emergency or need show their faces.

  39. marmico on Thu, 2nd Jun 2016 5:24 pm 

    Marmico, it seems to me that your ass is on fire.

    Fuck you. Answer the question.

  40. marmico on Thu, 2nd Jun 2016 5:33 pm 

    Doomer prep advice from JuanP. ROTFLMFAO. Ya, right. You bought an SUV to navigate Collins Drive when it floods with sea water. What a prepper!

    Answer the question or fuck off.

    If there were 100 gross BTUs extracted in the Saudi desert, how many net BTUs are in Sam’s gasoline tank in 1960 and at Sam’s Club in 2016?

  41. shortonoil on Thu, 2nd Jun 2016 5:51 pm 

    “I am sure you can have a meaningful argument with Mr. Hill and Mr. Rockman without resorting to insults and expletives.”

    It is generally assumed that Marm has never had a “meaningful” thought in his life! His use of expletives are to cover up a very debilitating inferiority complex. His liberal use of profanity is merely an attempt to hide the fact that he is clueless. If the Dems were aware of him they would probably run him for President.

    The 20.045% efficiency number was derived from a numerical analysis of the EIA data set. We have 21 programs that were written in “Just Basic”. They will run in the free interpreter that is available here:

    http://www.justbasic.com/download.html

    If anyone would like to play with the output of the Etp Model send us a note at the site, and we will forward that software to you. This is Just Basic not Visual Basic. It is a nice clean, no frills language.

    We will probably have a Visual Prolog application available in a few months that will employ an AI interface to help walk someone through the Etp Model.

    Thanks from all of us,

    http://www.thehillsgroup.org/

  42. marmico on Thu, 2nd Jun 2016 6:01 pm 

    Answer the question or fuck off, Bedford W. Hill The ETP Fuctard.

    If there were 100 gross BTUs extracted in the Saudi desert, how many net BTUs are in Sam’s gasoline tank in 1960 and at Sam’s Club in 2016?

    You get extra marks if you show empirical calculations of the four basic BTU flows:

    1. Ghawar extraction
    2. Pipeline, ship to Houston
    3. Refining in Houston
    4. Distribution to Bentonville

  43. shortonoil on Thu, 2nd Jun 2016 6:06 pm 

    Here is a sample of part of the source code for one of the 21 programs:

    ‘c:\bwh\basic\w_oil_p.txt

    ‘ This program inputs the year and mb/d of world oil production and places them
    ‘ in random filed records of c:\bwh\data1\w_oil_p.dat

    dim info$(10,10)
    global NumRecords

    print “BUILD WORLD OIL PRODUCTION FILE”
    print

    print “1) Start new file”
    print “2) Append existing file”
    print “3) Delete existing [file”
    print “4) Print existing file to screen”
    print “5) Edit existing record”
    print “6) Year and Delta Production BTU”

    print
    input “Choose “; choosevar
    cls
    if choosevar = 1 then goto [start1]
    if choosevar = 2 then goto [start2]
    if choosevar = 3 then goto [start3]
    if choosevar = 4 then goto [start4]
    if choosevar = 5 then goto [start5]
    if choosevar = 6 then goto [start6]
    notice “No valid entry found – GOODBYE”
    ‘REMOVE
    [start2]
    gosub [ckfile]
    goto [start]
    [start3]
    gosub [ckfile]
    [start4]
    gosub [printfile]
    goto [quit]
    [start5]
    gosub [openfile]
    gosub [ckfile]
    gosub [editrecords]
    goto [quit]
    [start6]
    gosub[printYrDeltaBTU]
    gosub[quit]

    [start1]

    gosub [ckfile]

    [start]
    gosub [openfile]

    if not(choosevar = 1 or choosevar = 3) then
    gosub [ckreclen] ‘ck number of record
    end if
    if choosevar = 1 then year$ = “0”
    gosub [inputRec]
    goto [quit]

    [inputRec]
    i= NumRecords
    while not(year$ = “”)
    i = i + 1
    input “Input year “; year$
    if year$ = “” goto [quit]
    year1$ = year$
    input “Input mb/d “; mbperday$
    put #1,i
    print
    if choosevar = 5 then year$ = “”
    wend
    return

    [quit]
    if not(choosevar =3) then close #1
    notice”GOODBYE”
    end

    function fileExists(path$, filename$)
    ‘dimension the array info$( at the beginning of your program
    files path$, filename$, info$()
    fileExists = val(info$(0, 0)) ‘non zero is true
    end function

  44. marmico on Thu, 2nd Jun 2016 6:24 pm 

    More garbage from Bedford W. “The ETP Fuctard” Hill.

    Answer the question empirically or fuck off.

    It is 8 boxes in an Excel spreadsheet. Four for 1960. Four for 2016. Then it can be determined that the empirical source(s) of your scintilla of scientism is mythical.

  45. shortonoil on Thu, 2nd Jun 2016 6:39 pm 

    “If there were 100 gross BTUs extracted in the Saudi desert, how many net BTUs are in Sam’s gasoline tank in 1960 and at Sam’s Club in 2016?”

    In 1960 there was 93.88, in 2016 there was 44.08 of the original 100 in the ground before it was pumped out of the ground. The balance was used in the production of the crude and the finished product. Of course, a gallon of gasoline has an energy content of a gallon of octane (API 62.2) which is 124,000 BTU. This has absolutely no relationship to the energy required to produce it. It is a property of the molecular structure of the hydrocarbon. C8H18 (octane) was C8H18 in 1960 and it was C8H18 in 2016. It will be C8H18 a billion years from now.

    Now — what was your question?

  46. shortonoil on Thu, 2nd Jun 2016 6:49 pm 

    “Then it can be determined that the empirical source(s)”

    Get lost troll! You are no more than a petty little thief that steals minutes from people’s lives.

  47. marmico on Thu, 2nd Jun 2016 6:57 pm 

    In 1960 there was 93.88, in 2016 there was 44.08 of the original 100 in the ground before it was pumped out of the ground.

    What a fuctard. I guess in 1960 there was no need to refine oil into gasoline for Sam’s vehicle. It takes 10 out of 100 units to refine oil in 2016. And it took more in 1960. So 93.88 out of 100 units in 1960 is abject bull shit.

    Make the 8 boxes so more will know that you are an unabashed fuctard.

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