evilgenius wrote:With the current glut in world oil there are plenty of people who have let go of peak oil as a driving force in world affairs. I'm not one of them. To me, the glut is the predictable result of prices rising so high, being derived from a more purely conventionally extracted market, that so-called unconventional sources became affordable to produce. Before fracking there were the large actors, those with huge reserves, and the smaller actors, those with some off-shore or some small fields. It was generally accepted that the smaller actors would peter out at their own pace, and that only the large actors would be left on the scene. It was the view that, eventually, we would be left with only the large Middle Eastern states and Venezuela and Nigeria. The assumption was that Saudi Arabia would be a key player at that time.
Fracking in the US changed that. The US has proven that they can produce as much oil as Saudi Arabia, on a daily basis. It took high oil prices for that to be realized. Suffice it to say that, for the near term, fracking has introduced another kind of actor. As a result, there is too much oil for high oil prices to be sustained.
In the past, Saudi Arabia has always been considered the swing producer. As such, they have been the de facto market maker when it comes to oil prices. Like General Motors, who were always able to produce cars more cheaply than any other manufacturer, they called the shots in terms of pricing. This time around, that has changed. The introduction of another actor has destabilized the former order. This new actor, the fracking actor, responds more significantly to high oil prices because it derives its capital from that scenario. Also, although it may be weak (experiencing many bankruptcies) before lower oil prices, because it relies upon the financial realm for much of its existence, and not just oil revenue, it has proven to have staying power in the face of lower prices. The fracking actor's creditors are happy with high output and the promise of better prices to come, or they are happy with bankruptcy, so to speak. This thinking will only be exacerbated by the recessions yet to come, brought about by the constantly swaying dynamics of both peak oil and slowing world growth. Fracking will endure.
Saudi Arabia doesn't enjoy the same edge when it comes to enduring this glut's low oil prices. This time around the Saudis are suffering under the weight of a highly developed largess economy that became the norm because nobody expected low prices would come that were not the result of Saudi provocation. Alas, this glut was not of their making. Thus, they will have to take drastic measures to deal with it. They are going to cut government spending. They are going to hack at the largess.
I think the Saudi measures to deal with the current glut will create a successful, to one degree or another, private sector in Saudi Arabia. This will be good for the Saudis. It will be bad for the world, in about fifteen or twenty years. I think that because I believe the introduction of a successful private sector in Saudi Arabia will result in the operation of the Export Land Model to a much more drastic extent than it would have under the regime of government largess. The extent of the impact of the Export Land Model under the regime of government largess was always baked into the former assumptions in regards to the essential position the kingdom would have at the point in the future when only the original large actors were left. The impact of a successful private sector has not been baked into those assumptions. When the time comes the Saudis won't have very much oil left over, after what goes into their own economy, to supply the world with anything like what was expected under the old model.
Fracking won't last any longer than they can wring the various formations at high expense of what oil is in them, the fifteen or twenty years I mentioned. It will, however, last long enough to ensure this. The Saudis will never be able to entertain a largess style economy again. Every time they try it the frackers will produce more. It will be a spiral towards a more and more efficient private sector in Saudi Arabia, probably a bumpy looking spiral, but a spiral in retrospect.
phaster wrote:this seems to confirm a comment I heard in a podcast that the "peak" is going to be more like a plateau that goes on for decades (which in the grand scheme of things is still like a blink of an eye in terms of geological time)
ROCKMAN wrote:"...think Bush should have included the KSA in his Axes of Evil." Unfortunately the US has a long history of siding with one different axis or or another if it APPEARS to suit our goals. Like France: we should have sided with the Vietnamese and bitchslapped the Frogs. LOL.
Seriously...Vietnam would have made a great Asian ally for the US.
evilgenius wrote:Fracking won't last any longer than they can wring the various formations at high expense of what oil is in them, the fifteen or twenty years I mentioned. It will, however, last long enough to ensure this. The Saudis will never be able to entertain a largess style economy again. Every time they try it the frackers will produce more. It will be a spiral towards a more and more efficient private sector in Saudi Arabia, probably a bumpy looking spiral, but a spiral in retrospect.
Saudi Arabia is warning that a computer virus that destroyed systems of its state-run oil company in 2012 has returned to the kingdom, with at least one major petrochemical company apparently affected by its spread.
Suspicion for the initial dispersal of the Shamoon virus in 2012 fell on Iran as it came after the Stuxnet cyberattack targeting Tehran's contested nuclear enrichment program.
It wasn't immediately clear who could be responsible for the new infection, though the relations between regional rivals remain tense.
A report Monday by Saudi state-run television included comments suggesting that 15 government agencies and private institutions had been hit by the Shamoon virus, including the Saudi Labor Ministry. The ministry said it was working with the Interior Ministry to contain the virus.
Sadara, a joint venture between the Saudi Arabian Oil Co. and Michigan-based Dow Chemical Co., shut down its computer network Monday over a disruption.
Company spokesman Sami Amin said its network remained down Tuesday, though it hadn't affected operations at the facility. He declined to comment further.
Sadara is based in Jubail Industrial City, which sits about 100 kilometers (60 miles) northwest of the eastern Saudi city of Dammam in the heartland of the kingdom's oil industry. The $20 billion facility, inaugurated by Saudi King Salman in late November, includes 26 manufacturing units that will produce more than 3 million metric tons of plastics and chemical products.
Another state-run TV report on Tuesday said the Saudi Technical and Vocational Training Corp. was affected, though a spokesman denied the virus did any damage to its network.
Symantec Corp., a California-based security firm, warned in late November that Shamoon had been spotted again in Saudi Arabia. Computers affected had their hard drives erased and displayed a photograph of the body of 3-year-old Syrian boy Aylan Kurdi, who drowned fleeing his country's civil war, Symantec said.
"Why Shamoon has suddenly returned again after four years is unknown," Symantec said . "However, with its highly destructive payload, it is clear that the attackers want their targets to sit up and take notice."
The November attacks apparently involved previously stolen passwords. Symantec on Monday said the outbreak might be linked to a group it called Greenbug, which previously attacked targets in Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia and Turkey with emails carrying malicious attachments. ...
A new variant of the Shamoon data-wiping malware—whose previous greatest hits include taking down Saudi Aramco in 2012—is again attacking various high-level Saudi organizations.
An alert issued by the telecom authority of Saudi Arabia said that Shamoon 2 is behind new attacks on the labor ministry and a chemicals firm, reports Reuters.
At the end of last year, security firm CrowdStrike noted that Shamoon was back, with the Iranian government likely behind it.
“This new variant of Shamoon kept many of its original tactics, down to the commercial raw disk ElDos driver that was used for disk wiping (including the original trial license key for this driver) that had been used in the original attacks,” the firm noted in a blog. “That ElDos trial key was only valid for 30 days and expired by September 2012. In order to continue to use the key, the wiper now has to reset the Windows system clock back to August 2012 to manipulate the license validation process.”
And indeed, in December, Saudi Arabia's state news agency confirmed that a cyberattack had recently occurred "on various government institutions and agencies,” and that "the attacks aimed at disabling all equipment and services that were being provided. The attackers were stealing data from the system and were planting viruses.”
Now, Jubail-based Sadara Chemical Co, a joint venture firm owned by Saudi Aramco and Dow Chemical, has confirmed a network disruption earlier this week, and said it was working to resolve the issue. And it’s not alone: Sources told Reuters that other companies headquartered in Jubail—the Kingdom’s petrochemical hub—have also been taken offline (as a precaution against the virus) after network incidents likely tied to Shamoon 2.
It’s a disturbing state of affairs considering that Shamoon (aka DistTrack) has destroyed, per TrapX Security research, more than 30,000 systems. The newest version of Shamoon spreads and destroys data even faster than before, the firm added.
“Shamoon’s malevolent objective is simple: Shamoon is designed to infect and destroy the maximum number of systems in a target organization,” said Moshe Ben-Simon, co-founder and vice president of TrapX Security.
Shamoon, like many other sophisticated weaponized attack tools, has been crafted to hide from discovery and protect itself from standard cyber defense such as sandbox analysis.
“The adversary is using a combination of social engineering and email phishing to infect one or a number of computers on an organisation’s networks. By downloading a file or clicking a link, employees may have unknowingly downloaded an exploit kit. Once infected, the computer rapidly performs port sweeps across the subnet and quickly spreads the malware to all hosts on the subnet. To inflict the most damage, the adversary will attempt to affect multiple computers in order to destroy data on every subnet across the network.
“Shamoon 2, like Shamoon that struck the oil company Saudi Aramco in 2012, moves extremely rapidly with the sole objective of destroying systems and bringing a business to its knees. Because the malware avoids using command and control communications, the only way to detect and respond in real time is to monitor the internal network for attacker behavior and traditional security such as firewalls, IDS/IPS and Web gateways are not effective.
Symantec researchers say they're investigating links between the Greenbug cyber espionage group and a new series of Shamoon malware attacks in the Middle East
The Symantec researchers note that the malware "required other means to be deployed on targeted organizations' networks and is configured with previously stolen credentials." It's possible, they suggest, that Greenbug may have been responsible for acquiring those credentials.
"Greenbug was discovered targeting a range of organizations in the Middle East including companies in the aviation, energy, government, investment, and education sectors," the researchers write. "The group uses a custom information-stealing remote access Trojan (RAT) known as Trojan.Ismdoor as well as a selection of hacking tools to steal sensitive credentials from compromised organizations."
Notably, the Greenbug group, which Symantec says has exclusive access to the Trojan.Ismdoor malware, compromised at least one administrator's computer in a Shamoon-targeted organization's network prior to the Shamoon malware being deployed in that network on November 17, 2016.
Between June and November of 2016, Symantec reports, the Greenbug group used phishing attacks to target organizations involved in aviation, government, investment and education in Saudi Arabia, Iran, Bahrain, Iraq, Qatar, Kuwait and Turkey.
Saudi Arabia wants 10 percent of its electricity to come from renewable sources within several years as part of a transformation in its power sector, the energy minister said Monday.
Khaled al-Falih said his country, the world's biggest oil exporter, will also sell renewable energy and its technology abroad.
At a forum seeking investment in the sector, he announced "30 projects to be implemented" in order to reach a goal of about 10 gigawatts of renewable energy production early next decade. Virtually all of the kingdom's domestic power currently comes from crude, refined oil or natural gas.
He has said the projects could cost between $30 billion and $50 billion.
"The percentage of renewable energy by 2023 will represent 10 percent of the total electricity of the kingdom," he said at the start of the Saudi Arabia Renewable Energy Investment Forum.
"We are seeking for the kingdom, in the medium term, to become a nation that develops, manufactures and exports the advanced technologies of renewable energy production," he said.
"This is really transformational," he said, suggesting that the changes coming to the kingdom's energy sector will be as significant as the discovery of oil in the 1930s.
Falih told the forum that nuclear power will also be part of the kingdom's energy mix.
Saudi Arabia has been for years trying to diversify its energy mix so that it can export more of its oil, rather than burning it at power and water desalination plants, but progress has been slow.
Power demand in the desert kingdom is growing 8% annually, forcing state-run Saudi Electricity, the Gulf's largest utility company, to spend billions of dollars on projects to add capacity.
The kingdom produces very little renewable energy, representing less than 1% of the total produced, but under an economic reform program approved by King Salman last year, it targets renewable energy contributing 3,450 megawatts to the national energy mix by 2020, equating to 4% of energy use in the kingdom.
Its finances strained by low oil prices, Riyadh wants to conduct many of its future infrastructure projects through partnerships in which private companies from within the kingdom and abroad would bear much of the cost and risk.
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