I think this is the beginnings of an economy based on perpetual growth and fossil fuel energy running headlong into geological energy constraints. Basically I see an undulatory downward path for the rest of my life. From here out, I think any rallies in our economic condition are going to be met with spiking commodity prices that knock us right back down.
Joined: Apr 03, 2004 Posts: 6972 Location: My Grandkids' Farm
Posted: Sat Apr 24, 2004 7:59 pm Post subject:
Hi Lister,
In some other posts I’ve made, I speculated that oil prices might decline in the next 4-5 years.
Gasoline, is a product of oil and hence subject to very short term fluctuations due to immediate supply.
IMO, today’s prices are only relevant as a gauge of the oil co’s forecast of future supplies.
$3. at the pump WILL suppress demand for the next several years. They got LOTS of money to forecast supply, and I’m sure there is a reason they haven’t invested in refinery capacity, only in mergers to gain reserves.
Pops
Yadda.. yadda..
P.S. I guess debate is why I'm here, cetainly not preperation advice.
Joined: Apr 21, 2004 Posts: 508 Location: Republic of Texas
Posted: Mon Apr 26, 2004 7:52 am Post subject:
I am a refinery engineer so I don't have a lot of insight into the upstream aspects. The company I work for is strictly refining and marketing. I have dealt quite a bit in the gasoline supply side of things. From my perspective, the primary reason we are seeing high gasoline prices right now is clean air regulation. A 300 ppm sulfur gasoline spec went into effect at the first of this year. This has kept approximately 300-400,000 bbls/day of gasoline imports out of the country. CA, NY, CT have banned MTBE which further limits supply. U.S. refining operates at 100% capacity during the peak gasoline demand in the summer. We've gotten to this point because the capital invested in the refineries is going toward meeting environmental regulations instead of expansion. I'm all for clean air but you can't have it both ways.
What does the refining industry think about peak oil? I've never heard anything about it until a few weeks ago. I got here from a link on a sports forum.
Posted: Mon Apr 26, 2004 8:16 am Post subject: Factors
A convergence of market factors determines the ultimate cost of any commodity. From supply numbers, government regulation, consumer perceptions etc… Tight conditions at the refinery level, probably contribute more than any single factor in today’s pump price, but since commodity brokers set the wholesale barrel price on speculation, price always lags behind reality. I would expect that crude barrel prices would fluctuate during global peak as various sources of oil around the world increase or decrease actual production. When the down-swings cross the excess production margin capacity, prices should spike pretty high, but when the range of price swing settles into these reserve production margins, high oil price will seem like the good old days… Unavailable at any price = international conflict. _________________ "When you understand why you dismiss all the other possible gods, you will understand why I dismiss yours." - Stephen F Roberts.
Joined: Apr 17, 2004 Posts: 984 Location: Tulsa, Ok
Posted: Mon Apr 26, 2004 12:11 pm Post subject: Thats it in a nut shell
Aaron hit it exactly. Many factors play into the costs of any commodity.
When not enough of a commodity is available. Then costs go up. As long a supply continues to meet demand, growth continues. When supply no longer grows then growth slows, then stops, then declines.
It's hard to support this hypothesis. Honestly, we've spent weeks debating here about the consequences of peak oil. I still don't see why nations would fight over resources that don't exist. Am I being ingenuous? A little bit, though I agree with any speculator that suspects market crash and population decline.
Posted: Mon Apr 26, 2004 2:57 pm Post subject: war
All wars are based on crontrolling resources. From land to mineral wealth to intellectual property, war is about control of power, political power. Every war ever fought can be said to be rooted in the aquisition of, or defense of power in some form... name one that was not.
Wars have been fought over simple wealth... look at Iraq invading Kuwait. Can you imagine the response of nations facing disaster because of collapsed economies and massive social problems? Imagine what the US would be capable of, if they determined it was in our national interest. An American President, a hero, and a patriot named Truman made a terrible decision in the 40's and dropped the bomb which ended WWII saving potentially millions of Allied lives. Is there any doubt that America would choose intervention faced with a true international crisis? _________________ "When you understand why you dismiss all the other possible gods, you will understand why I dismiss yours." - Stephen F Roberts.
Joined: Apr 04, 2004 Posts: 579 Location: Western US
Posted: Mon Apr 26, 2004 3:07 pm Post subject:
An idea presented by Rifkin was that all wars are energy wars.
For instance, when the romans went raping and pillaging they brought back the booty in the form of slaves and riches. The Riches took human energy to produce. in simple terms from a simple man; gold bullion has an intrinsic energy value because it had to be mined smelted etc., and during that era slaves were the electricity and oil that harvested food.
Well, if you want to get technical, everything is energy and everything can eventually be broken down to simple actions begot by changes in energy. Though it is important to look closely, Rifkin was looking at bacteria through a microscope while he should have been reading the fine print.
The point I wished to make was not that wars are not fought over power. Naturally, they are. Those who practice war and those who plan it take pride in war as a means to represent, defend and gain power. The point I wished to make was that there is no use in fighting a long, energy-intensive war over limited energy resources (or, as you stated, "nonexistant resources.")
Joined: Apr 03, 2004 Posts: 6972 Location: My Grandkids' Farm
Posted: Mon Apr 26, 2004 4:16 pm Post subject:
If there is enough oil in Iraq to last the US thirty years (I don’t know if that’s a correct number or not), that is an extremely long time in political terms. Japan’s decision to attack the US in WWII was based on oil and took 4 weeks.
The Key Moment in Japan's Decision for War (From Iriye, pp. 149-150):
"Between 2 July and 9 August [1941], then, a crucial reversal of Japanese strategy had taken place. From preparedness for an impending offensive against the Soviet Union, the supreme command reverted to a more passive stance in the north. Sixteen divisions would still be mobilized, but they would not be engaged in any action for the time being. Henceforth, Japanese strategy would focus on a possible conflict with the A[merica ]B[ritain ]C[hina ]D[utch East Indies] powers. In this sense, 9 August may be taken as the point of no return...
"The United States contributed to that turn of events by instituting a de facto embargo on [exports of] oil [to Japan].
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