[shortonoil]

"Comfortable americans have no idea how low economies everywhere have already sunk."

That's for sure; the latest piece is that in Venezuela people are so weak from lack of food that they aren't even rioting. I have a friend on the Ivory Coast that I chat with; she is telling me that much of the country has already reverted to something like an African Dark Ages. Of course, Americans have Detroit, and the complete collapse of a dozen or more inter-cities that they just don't mention. When controlling perception becomes more important than controlling the real world you know we are deep doo-do.

[marmico]

"Comfortable americans have no idea how low economies everywhere have already sunk."

Ya, sure. World per capita GDP has increased by 1.4% per year since 1980.



Bring on some more laughingstock from Bozo Bunsen Burner Bedford.

[vtsnowedin]

Though few are able/willing to admit it, the Greatest Recession ever was sparked in large part by the 2005 conventional oil peak and half-decade of $100/barrel oil (from $40).

Nah. But again, until we know which alternate universe you are in today, we can't fight your phantoms, so we'll just stick with the real reasons of the 2008 recession. But feel free to modify Wiki to stop calling it the "subprime mortgage crisis".

https://en.wikipedia.org/wiki/Causes_of ... _Recession

If you read the whole wiki piece oil prices are given credit for being if not the cause but the trigger.

Economist James D. Hamilton has argued that the increase in oil prices in the period of 2007 through 2008 was a significant cause of the recession. He evaluated several different approaches to estimating the impact of oil price shocks on the economy, including some methods that had previously shown a decline in the relationship between oil price shocks and the overall economy. All of these methods "support a common conclusion; had there been no increase in oil prices between 2007:Q3 and 2008:Q2, the US economy would not have been in a recession over the period 2007:Q4 through 2008:Q3."[224] Hamilton's own model, a time-series econometric forecast based on data up to 2003, showed that the decline in GDP could have been successfully predicted to almost its full extent given knowledge of the price of oil. The results imply that oil prices were entirely responsible for the recession.[225][226] Hamilton acknowledged that this was probably not the entire cause but maintained that it showed that oil price increases made a significant contribution to the downturn in economic growth.[227]

I know people that were in the restaurant business at the time. When gas hit $3.50 their tip income dropped by more then half and they could not sell or refinance their house because there were no buyers with enough spare cash to buy and the lending rules suddenly tightened. They lost the house and all the considerable cash they had sunk into it.

[shortonoil]

"Pstarr,may lose his bet because sucker investors & Banks keep propping up the Oil Industry and the Govt itself will try to also because the Oil Industry is the Economy so they will continue pumping full out."

Correct, the monies being lent are covering losses, they are not expanding the industry. When yields have fallen to the point that no matter what is pumped there will not be enough finished product produced to keep the economy rolling the printing funny money game will come to an end. For the US it now needs about $540 billion per year to keep the oil flowing. The Banks are going to contribute about $300 billion of that this year. The rest will probably come from investors like pension and hedge funds via the FED money spigot.

http://www.zerohedge.com/news/2017-04-2 ... ling-apart

By 2019 it will take 2 barrels of crude to produce 1 barrel of finished product. Past that point any semblance to a regular economy will be getting lost. It looks like pstarr is about a year early.

[shortonoil]

"Ya, sure. World per capita GDP has increased by 1.4% per year since 1980."

The Central Banks are going print us all to fabulous riches! Not!

[vtsnowedin]

Why are you still talking about volume? The drilling and extraction of oil volumes don't really matter. What it really matters is the final amount of energy that reachs Joe the Plumber.

There are several other measures more important than total volume. The oil exporters gain wealth through oil sales and oil-field employment, and then typically subsidize oil consumption among the general population. The Export Land Model demonstrates that exports decline faster than production increases,( should read DECREASES) wealth and the ability to pay for oil is redistributed away from the importers. Hence the collapse of oil prices down from $100/barrel.

Not only does ETP show that less energy reaches the consumer, it also suggests that money spent on low quality oil production has less economic value. Less money and oil to add value to the final product. Less oil to convert NGL's into plastic goodies.

pstarr : You have cut and pasted that same argument with the same flaw before verbatim.
And if a exporting country has less oil to export ,which is true if their domestic consumption is rising and production is steady or declining, then they will need to sell it at a higher price not less. Only a glut in supply from other exporting countries can force them to sell for less.
Plenty of energy is reaching the consumer and a gallon of gas has the same BTUs as it always had and takes the plumbers truck as far as it always did.

[shortonoil]

"Ya, sure. World per capita GDP has increased by 1.4% per year since 1980."

By the way, where did the other $3.5 trillion that they printed last year go? Tells us that you got it, we all need a good laugh at this point.

[vtsnowedin]

....
.....
Well you are right about that, but you are a brave lad to take that bet on production. It takes 50% more Shale to produce a barrel of finished product than it does light sweet crude.

Again with the fifty percent loss BS Shorty ? You really are persistent if not all that clever.
But OK let's look at your statement ,false as it is, and see what that might mean using last weeks price of $53 for WTI.
Compare a well #1 of conventional oil with a ERoEI of 9 to 1 if your statement was correct the fracking well #2 it will take 50% more energy in the form of crude for each barrel so would have a ERoEI 5.7 to 1
Well #1 produces 10 barrels and uses 1 of them to produce the other 9 and well #2 produces 10 barrels and uses 1.5 of them to produce the other 8.5 . Are you following along?
So lets move on to cost per barrel to produce these crudes. Well #1 uses $53 of oil to produce 9 for a cost per barrel for a cost per barrel of $5.88/bl and well #2 uses $79.50 to produce 8.5 barrels for a cost of $9.35/ barrel.
Both the $5.88- 9 barrels and the $9.35 - 8.5 barrels have the same API and same BTUs per barrel as far as the refinery and final customers are concerned.
Now the fracking company is not going to be selling any oil for ten dollars a barrel but a difference in production costs of $3.47 is certainly not the end of the world in a $50 to $60 price world and won't be a problem until fracked oil becomes the majority of the worlds supply.

[marmico]

The CBs conjure up another $trillion, nothing to see here (literally) move along.

The U.S. Federal Reserve Bank has conjured nothing for almost 3 years. Stick to your new found refinery bullshit, retard laughingstock. If anything, the FED is conjuring less.

[pstarr]

Pstarr,may lose his bet because sucker investors & Banks keep propping up the Oil Industry and the Govt itself will try to also because the Oil Industry is the Economy so they will continue pumping full out. Remember money can be created out of thin air. That should give nobody comfort as that will mean we will deplete our remaining legacy reserves that much faster and thus reach that much faster the denouement of the Oil Industry

I don't think so. The investors can't handle $60 oil now. Certainly not the consumer.

Peak oil is regional, England and Argentina still don't produce their tight shale, promised for a decade. Their infrastructure and economy will not allow it (neither has the regional collection system in place). England/Argentina are poor. The US is now poor. We just don't know yet (check out Tesla's valuation as a measure of our true wealth). Long before I heard of ETP (though I know totally get it sort of) I became aware of really simple economics, not the investor-class version but basic law of supply and demand

My point is that the demand>supply economic equation is broken. RM's Peak Oil Dynamic and price oscillations destroys exploration, development, and production efforts and cause regional collapses. All over the world the cost-basement of production is bumping up against the price-ceiling of consumption.

It's come home. We will never match our tight-shale production peak, while all our legacy fields are in decline. Some precipitously like the North Slope. Don't forget its inflection point, like shale.

[vtsnowedin]

Notice that Shorties and Pstarr's last posts have nothing to do with the discussion immediately above. Can't deal with being called out so try to change the subject and turn the page. Same old B^!! $#^! different page and or different thread.

[AdamB]

Then we have no bet since I find your terms to be unreasonable.

To make a bet in this reality, he would need to be in this reality. The guy can't even look at a graph showing numbers going UP..and understand that UP means BIGGER...rather than a peak. Wise decision, pat him on the head and smile, and move on and find adults to discuss topics of significance with.

[pstarr]

I don't think so. The investors can't handle $60 oil now. Certainly not the consumer.

You are certainly correct about that! $60 oil, and we would see refiners and distributors folding up like cardboard suit cases. But, like I said previously, the industry needs 2.5 mb/d/yr more just to stay even; just to compensate for declining yields. Even at $50 we could see one more big push, the banks have over $300 billion riding on this. You are betting on who is going to blink first: risky!

No risk. No bet, not with a troll . . . certainly not on the troll's terms.

Industry and the bankster sharks still need bottom-fish investors to feed on, the mom and pop crowd. Don't underestimate the guppies and catfish, might have learned their lesson. Staying down in the mud lol

[shortonoil]

"No risk. No bet, not with a troll . . . certainly not on the troll's terms.

Industry and the bankster sharks still need bottom-fish investors to feed on, the mom and pop crowd. Don't underestimate the guppies and catfish, might have learned their lesson. Staying down in the mud lol"

lol, no such thing as a gentleman's bet from that crowd! They are more like a school of baby Parana stuck in a goldfish bowl. Betting on any sense of integrity is not likely to work in your favor. But I have to side with onlooker; oil is the economy and if oil goes south so will the economy. Oil is also the only thing at this point that gives the dollar any value. If the FED loses oil it loses the dollar, and without the dollar there is no FED. They will most likely hock the family jewels to keep things going for one more day. Putting a female hobbit as head of the FED may have been a mistake; small jewel case. They will push this thing as far as possible until the Laws of Physics runs over them. You can't win, you can't break even, and you can't get out of the game is riding hard in this direction. Ma and Pa had better hide what they have under the mattress; when this breaks loose their gold fillings are going to become fair game. In this war, King Oil is not going to be taking any prisoners.

[AdamB]

Though few are able/willing to admit it, the Greatest Recession ever was sparked in large part by the 2005 conventional oil peak and half-decade of $100/barrel oil (from $40).

Nah. But again, until we know which alternate universe you are in today, we can't fight your phantoms, so we'll just stick with the real reasons of the 2008 recession. But feel free to modify Wiki to stop calling it the "subprime mortgage crisis".

https://en.wikipedia.org/wiki/Causes_of ... _Recession

If you read the whole wiki piece oil prices are given credit for being if not the cause but the trigger.

Economist James D. Hamilton has argued that the increase in oil prices in the period of 2007 through 2008 was a significant cause of the recession. He evaluated several different approaches to estimating the impact of oil price shocks on the economy, including some methods that had previously shown a decline in the relationship between oil price shocks and the overall economy. All of these methods "support a common conclusion; had there been no increase in oil prices between 2007:Q3 and 2008:Q2, the US economy would not have been in a recession over the period 2007:Q4 through 2008:Q3."[224] Hamilton's own model, a time-series econometric forecast based on data up to 2003, showed that the decline in GDP could have been successfully predicted to almost its full extent given knowledge of the price of oil. The results imply that oil prices were entirely responsible for the recession.[225][226] Hamilton acknowledged that this was probably not the entire cause but maintained that it showed that oil price increases made a significant contribution to the downturn in economic growth.[227]

I know people that were in the restaurant business at the time. When gas hit $3.50 their tip income dropped by more then half and they could not sell or refinance their house because there were no buyers with enough spare cash to buy and the lending rules suddenly tightened. They lost the house and all the considerable cash they had sunk into it.

I noticed that piece about Hamilton, and there is one additional piece of information related to him that is pertinent. He has made a chart, Pstarr has used it on occasion when he is trying to pretend that only is the only cause of recessions (regardless of whether or not the oil spike was 5%, or 50%), which labels global recessions that aren't, at least not as how recessions are defined most of the time. If he redefines global recession as just "not as strong of growth as before", his charts make sense. Otherwise, they do not. Apply the normal definition of recession to the globe, and his ideas come apart at the seams.

But I've read some of his stuff before, for an economist he understands some fundamentals of oil far better than nearly every peak oiler I've ever read. Not sure why he felt the need to stretch definitions to make his oil point, I only know that he did.

[AdamB]

No risk. No bet, not with a troll . . . certainly not on the troll's terms.

[Tanada]

Adamb stop teasing/trolling for reactions, it gets tiresome after a short period and you have been going on too long.

[pstarr]

"NOTHING is Impossible with the power of Capitalism and Free Markets unleasing the creative energies of the human spirit! (Sarcasm)"

The sarcasm is certainly justified. One size fits all usually doesn't fit anything very well. Any system is dependent on a number of variables. Just because capitalism and free markets worked at one time is no guarantee that they will work at another. The apex of that system occurred at a point of phenomenally high value resources; that era is over.

Those high-value resources (natural capital--concentrated ores and hydrocarbons) made possible industrialization art leisure technology the great modern cities and explosive population growth. And education and mores specialized tools. To build ever-more specialized tools. To extract ever-more dispersed and crummier mineral deposits. We used finer technology to get at the remaining stuff. Tight-shale production is arthroscopic mining. On a terminal patient lol

[onlooker]

The apex of that system occurred at a point of phenomenally high value resources; that era is over.---- Yes and with it Capitalism and diverse Markets. These economic arrangements are not possible in an era of decreasing and expensive to society energy resources. The problem of course is that the entire planet in one way or another, directly or indirectly relies for its livelihood on sufficient energy. Energy fuels the Economy. The consequences of this new era of a shortfall of energy will not be homogeneous in either time or space. Meaning different areas will see less worse or worse fallout and at different time intervals. One thing is certain the cushy and comfortable lives of almost all people will disappear.

[pstarr]

Yes, diverse economies (with greatly different energy needs) will fall at different rates, but make no mistake: the vast wealth of the few industrial powerhouses is also over.

America is too dependent on just-in-time manufacturing, dispersed supply lines, and a dumbed down manufacturing base. Even at the most basic level we have lost our ability to make stuff. Is there a restaurant left that could actually slaughter, process, prepare a whole steer. Our food comes from 1,000's of miles away in refrigerated plastic. There is no other way. Same with sub-assemblies for every tool our lives depend on.

We need those other failing economies