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Ultimatum to Saudi's $50 a barrel

General discussions of the systemic, societal and civilisational effects of depletion.

Re: Ultimatum to Saudi's $50 a barrel

Unread postby SeaGypsy » Thu 26 Jan 2012, 18:12:24

Another catch 22 for the USA. Pulling back from interference with international politics around the world should be funding priority 1 for fixing up the homeland. But pulling back would likely produce among other effects, an accelerating oil price; increasing costs across the board. There is no political will to sort out this mess on either side, so it won't happen.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby Kristen » Thu 26 Jan 2012, 20:49:56

As Matt Simmons would say "Oil is still cheap". And that is at 100 dollars a barrel.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby SeaGypsy » Thu 26 Jan 2012, 21:25:31

Cheap enough for Matt!

More to the point, cheap enough for folks who:

Use as their main vehicle, something around the 125cc range.
Live 8 people in a 10 msq house with no debt and nominal rent.
Eat a diet roughly: 75% starch (rice generally) 20% veg & in season fruit, 5% protein.
Work at the end of the pay scale which has gone from $2 a day to $5 a day over the plateau period (since 06).

There are at least a billion like this and another billion waiting in the wings. Behind these are another few billion just trying to get $1 a day and educate their children.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby Pretorian » Thu 26 Jan 2012, 23:50:25

SeaGypsy wrote: Cheap enough for Matt!

More to the point, cheap enough for folks who:

Use as their main vehicle, something around the 125cc range.
Live 8 people in a 10 msq house with no debt and nominal rent.
Eat a diet roughly: 75% starch (rice generally) 20% veg & in season fruit, 5% protein.
Work at the end of the pay scale which has gone from $2 a day to $5 a day over the plateau period (since 06).


Yes, all that is unfair advantage paid by First World Citizens to it's own detriment.

SeaGypsy wrote:There are at least a billion like this and another billion waiting in the wings. Behind these are another few billion just trying to get $1 a day and educate their children.


Why would they even want to do that? So their kids would dig the dirt or sweat in sweatshops with PHDs behind their backs? Awfully cruel to them and awfully expensive to whomever will be paying for those, imo
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby SeaGypsy » Fri 27 Jan 2012, 04:11:31

The program pretty much sucks, a C+ at best.But the promos have looked great for several decades, especially since sat tv.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby Subjectivist » Fri 02 Jun 2017, 17:39:18

thisisit wrote:In order to get out of the hole USA should impose a 50 dollars per oil for each barrel of oil. No more futures market on oil in USA just a plain price of 50 dollars, of course after a year or two of that medecine USA impose another cut to 30 dollars....Big oil companies get their usual cut and their share of the market, consumers see a drastic drop in the gaz price at the pump, industries start saving lots of money...and jobs reappear...of course Saudi's will get hangry at such a push but in order to obset the lost they encounter between present price and the so call 50 lets offer them investment priority in USA which should bring a source or revenue and new political power in the coutry day to day business...lets see it as a new kind of partnership and forget about peak oil...what's important is peak job, work today, eat today...think tommorow after a good night of sleep.


I have to say, when this old thread popped up on my feed I almost laughed out loud.

What a difference a couples years make :twisted: :mrgreen:
II Chronicles 7:14 if my people, who are called by my name, will humble themselves and pray and seek my face and turn from their wicked ways, then I will hear from heaven, and I will forgive their sin and will heal their land.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby sparky » Fri 02 Jun 2017, 19:15:24

.
Internet blogging is usually a stream of consciousness thing
it is refreshing to take a look back at ourselves if only to calibrate our opinions
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby onlooker » Fri 23 Jun 2017, 18:28:42

http://www.zerohedge.com/news/2017-06-2 ... -worthless
Gartman: 'Oil Heading Egregiously Lower'; Saudi Oil Reserves Will Be 'Worthless'
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby onlooker » Fri 23 Jun 2017, 18:37:33

How is the discussion on POB lately P?
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby Cog » Fri 23 Jun 2017, 20:27:14

onlooker wrote:How is the discussion on POB lately P?


You should have asked him how the discussion is going on The Oil Drum.

No wait... :lol:
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby AdamB » Sat 24 Jun 2017, 10:42:43

thisisit wrote:In order to get out of the hole USA should impose a 50 dollars per oil for each barrel of oil. No more futures market on oil in USA just a plain price of 50 dollars, of course after a year or two of that medecine USA impose another cut to 30 dollars....Big oil companies get their usual cut and their share of the market, consumers see a drastic drop in the gaz price at the pump, industries start saving lots of money...and jobs reappear...of course Saudi's will get hangry at such a push but in order to obset the lost they encounter between present price and the so call 50 lets offer them investment priority in USA which should bring a source or revenue and new political power in the coutry day to day business...lets see it as a new kind of partnership and forget about peak oil...what's important is peak job, work today, eat today...think tommorow after a good night of sleep.


Ideas like this are what got Venezuela into the mess it is in.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby kublikhan » Sat 24 Jun 2017, 19:55:46

AdamB wrote:Ideas like this are what got Venezuela into the mess it is in.
+1
Chavez too though he could dictate what prices should be. Things did not turn of as he hoped. Instead of leashing the producers to his will he instead created black markets, massive corruption, and pervasive shortages. High oil prices allowed him to paper over the worst of this perverse situation. At least for awhile. However when oil prices collapsed the true depths of the damage Chavez and Maduro did to the economy became clear.

Images of citizens waiting in lines to get basic goods — toilet paper, flour, milk — throughout supermarkets in Venezuela abound across the internet. Such surreal imagery is the norm in present-day Venezuela. From the 1950s to the late 1990s, Venezuela was Latin America’s most economically and politically stable country. Fast-forward to the present, and Venezuela is not only undergoing an unprecedented economic collapse, but it is also on the verge of becoming a failed state.

Understanding Venezuela’s Shortage Crisis
How could a country that was once so prosperous fall to such lows? Basic economics dictates that goods do not just vanish out of thin air. To comprehend the phenomenon of shortages in Venezuela, a cursory analysis of the economic measures passed by Hugo Chávez’s regime and his successor, Nicolás Maduro, is needed.

The main culprit in Venezuela’s economic tragedy is government intervention, specifically price controls implemented during the Chávez and Maduro administrations. These controls have been the underlying factors behind the rampant scarcity of basic goods in Venezuela.

Venezuela’s Current Price Control Experiment
Emboldened after an unsuccessful coup attempt against his government in 2002, Hugo Chávez initiated a series of interventionist measures with the aim of preventing capital flight. These measures included expropriation of key industries, exchange controls, and price controls.

Despite the harmful nature of these policies, the flow of petrodollars thanks to high oil prices could give Venezuelan businesses the luxury of importing basic goods and raw materials as a short-term, fallback measure. Even with high oil prices, shortages of price controlled goods began to slowly pop up in 2006 due to the exchange and price controls.

When oil prices started to fall, harsh economic realities began to surface. Scarcity would soon become a nationwide phenomenon in Venezuela thanks to the combined effects of stringent exchange controls that did not allow for the free entry of dollars and a price control regime that prevents the price system from functioning in the economy.

With high levels of inflation coming into the mix, Venezuela’s socialist government would strengthen its price controls. Through its passage of the Fair Prices Act in 2014, the Venezuelan government aimed to tame shortages by banning profit margins over 30 percent and tightening price ceilings on basic goods.

The aforementioned law has only aggravated Venezuela’s shortage crisis and has put the country on the road to famine. In heavy-handed fashion, the government continued its interventionist policies with the establishment of CLAPS, local supply and production committees, that only ration food to government supporters. These measures will result in further misery and poverty.

The Laws of Economics Must Be Respected
In the free market, prices function as signals to both consumers and producers of how much of a product or service must be demanded or supplied respectively. For producers, prices communicate whether it is a good time to enter or leave a certain market. Falling prices and the potential for losses signal to employers the need to leave a market. On the other hand, rising prices and the potential for profit-making incentivize producers to enter a market.

On the consumer end, lower prices signal to consumers that it is a good time to buy said good or service. Higher prices generally discourage consumers from buying a certain product or incentivize them to look for cheaper substitutes. This dynamic ultimately leads to an equilibrium price that is the product of market forces, not government decrees.

When price ceilings are implemented, this price coordination mechanism is turned on its head. An artificially low price leads consumers to demand more of a good than producers are willing to supply. When demand outstrips supply, shortages emerge.

These arbitrary ceilings disrupt the productive structure of businesses and do not allow them to bring goods to the market in a cost-effective manner. Unsurprisingly, many businesses are forced to incur losses, especially if the legislated price falls below the natural market price that is needed to meet operational costs. Less fortunate enterprises will find themselves compelled to shut down their operations as they can no longer afford to supply goods to the market given the artificially low prices.

Price Controls: A Historical Analysis
Price controls have existed since time immemorial. No matter the time or place, the result of such measures has always been the same — shortages and black market activity. Under the rule of Roman Emperor Diocletian, price controls were imposed through the Edict on Maximum Prices in 301 AD. The purpose of this law was to combat the inflationary prices present throughout the Roman economy and reign in the avarice of merchants. A half-measure, at best, that did not address the underlying cause of the inflation — monetary debasement — this law resulted in shortages, businesses shutting down, and the emergence of black markets.

The US was not exempt from the harsh laws of economics either. In 1971, Richard Nixon issued Executive Order 11615 in order to “stabilize the economy, reduce inflation, and minimize unemployment.” Despite being passed under the premise of fighting inflation and curbing the effects of the Organization of Petroleum Exporting Countries (OPEC)’s production cuts, these price controls not only proved to be ineffective in curbing inflation, but they also created a new problem — shortages.

Analyzing the Nixon-era price controls, renowned economist Thomas Sowell noted that “price controls turned a minor adjustment into a major shortage.” Instead of letting prices rise, thus providing oil companies an incentive to produce more, the US government decided to impose arbitrary controls that delayed the necessary market adjustment.

Like clockwork, long lines resulted. Consumers that were frustrated with waiting hours in line would use black market means to buy gas at significantly higher prices. Consumers that are desperate to attain price controlled goods will resort to the black market, no matter how much more expensive the good is, given the stark reality that the price-controlled white market cannot meet consumer demand.
Price Controls Are Disastrous for Venezuela, and Everywhere Else
The oil barrel is half-full.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby shortonoil » Sat 24 Jun 2017, 21:09:58

Gartman: 'Oil Heading Egregiously Lower'; Saudi Oil Reserves Will Be 'Worthless


It had to happen eventually; he's right!
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby AdamB » Sat 24 Jun 2017, 21:31:09

Cog wrote:
onlooker wrote:How is the discussion on POB lately P?


You should have asked him how the discussion is going on The Oil Drum.

No wait... :lol:


BBWWAAAAHHAAAAA!!!!

i wonder if the same mechanisms that caused folks to flee TOD will function at Ron's place? I'll bet they won't, and it is because of the lack of real professionals involved at Ron's place. Folks had credibility on the line at TOD, folks like Art, participants and editors and whatnot. When the professional organizations began naming them in public, in national venues, and giggling about their opinions...well...that was it. TOD vanished soon thereafter, and some of those same folks became quite a bit more rational, and even more interesting? Began removing their affiliation with TOD from their bios. That was the final nail. And how some of those same people turned on TOD at the end, admitting WHY they had gotten it all wrong? That was another nail, and a fine, lethal one. When the gullible started devouring each other to show how they REALLY hadn't been as stupid as their ideas made them appear..well...done deal.

So the remnants at Ron's place are just doing the same thing. But while back in the day people were talking about TOD...no such thing is happening with Ron's place. Maybe next peak oil scare?
Plant Thu 27 Jul 2023 "Personally I think the IEA is exactly right when they predict peak oil in the 2020s, especially because it matches my own predictions."

Plant Wed 11 Apr 2007 "I think Deffeyes might have nailed it, and we are just past the overall peak in oil production. (Thanksgiving 2005)"
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby asg70 » Sun 25 Jun 2017, 11:08:17

In defense of The Oil Drum, I think there was a genuine effort on their part to tease out the truth using scientific methods. I think bias crept into their analysis but it was far more genuine an effort than you see today in the remains of the peak-oil movement. The reason being that only hardcore perma-doomers are left, those who are driven almost entirely by bias rather than logic.

With TOD it's sort of a hindsight is 20/20 thing. It's not a sin to be wrong. The right thing for the contributors to do there was to just throw up their hands, pack it in, and go home. I don't know where any of the others "went", but Gail's response to go off and start her own personal cult, that lowers my opinion of her. I have more respect for think-tanks that are about the issues than I do individuals who sort of pump themselves up as sages and too much of the doomerverse is populated by these egotistical figures. It makes it look more like an attention-grab. But with so few doomers left maybe it's unavoidable that it's these little individual mouthpieces with their megaphones.

BOLD PREDICTIONS
-Billions are on the verge of starvation as the lockdown continues. (yoshua, 5/20/20)

HALL OF SHAME:
-Short welched on a bet and should be shunned.
-Frequent-flyers should not cry crocodile-tears over climate-change.
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby onlooker » Sun 25 Jun 2017, 11:28:06

http://www.businessinsider.com/oil-pric ... ket-2017-6
There are several 'red flags' in the oil market right now
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby AdamB » Sun 25 Jun 2017, 21:31:00

asg70 wrote:In defense of The Oil Drum, I think there was a genuine effort on their part to tease out the truth using scientific methods.


Sure...depending on how you want to define "scientific methods", some it being no more complex than shorty fitting random equations to production rates and thinking it was predictive.

asg70 wrote: I think bias crept into their analysis but it was far more genuine an effort than you see today in the remains of the peak-oil movement.


I think it was more than just bias. Bias in hypothesis can be corrected when a scientist bumps into analysis that contradicts his original hypothesis, and can adjust and learn. The Oil Drum started with a hypothesis and then used as much reasoning as it could to rationalize it. Arguably, zealotry-lite, only involving people who know more math than the likes of pstarr.

asg70 wrote:With TOD it's sort of a hindsight is 20/20 thing.


The etp model has the identical problem. Fit a curve to some data, and assume it is predictive. There is a reason why people can stop it one fast. It is a standard newby mistake.

asg70 wrote:
It's not a sin to be wrong.


Quite true. But it IS a sin to refuse to LEARN. Larry Drew of the USGS recalled once that Hubbert pulled the publication of an article predicting oil production off into the future because he had found something, and knew it would have any effect that must be accounted for, but he hadn't done that yet. What happened next was Hubbert's equations for calculating inferred reserves, the initial method used by the USGS to measure such things back in 1975.

That is how a scientist does it. He/She learns. The TOD, as best I can tell, only decided to "learn" when they wrote up the post mortem on the obvious reasons why they had failed so spectacularly.

http://www.theoildrum.com/node/10093

Notice Nail #2. There were people on this very website who were talking about EXACTLY that, and why it couldn't be discounted. So obviously Nail #2 wasn't a surprise to some folks..but TOD only recognizes it AFTER it blows up in their face and begins to describe the kind of professional consequences I've previously detailed.

asg70 wrote:
The right thing for the contributors to do there was to just throw up their hands, pack it in, and go home.


Quite true. But you needed to modify your sentence slightly, to include what I have detailed at a particular gathering of professionals...here is a better ending to your sentence, and one that I believe is critical to providing the pressure to doing what you just said...

The right thing for the contributors to do there was to just throw up their hands, pack it in, and go home, before their professional reputation was damaged any further.


asg70 wrote: I don't know where any of the others "went", but Gail's response to go off and start her own personal cult, that lowers my opinion of her.


...and Rapier..and Ron...and Berman...and David Hughes...and Foss....

Robert appearing to be the only one who seems to KNOW anything, or perhaps I should say, he posts on his blog and it isn't 4 squared stupid perma-doomer.

asg70 wrote: I have more respect for think-tanks that are about the issues than I do individuals who sort of pump themselves up as sages and too much of the doomerverse is populated by these egotistical figures. It makes it look more like an attention-grab. But with so few doomers left maybe it's unavoidable that it's these little individual mouthpieces with their megaphones.


The doomer herd is pretty thin nowadays, isn't it?
Plant Thu 27 Jul 2023 "Personally I think the IEA is exactly right when they predict peak oil in the 2020s, especially because it matches my own predictions."

Plant Wed 11 Apr 2007 "I think Deffeyes might have nailed it, and we are just past the overall peak in oil production. (Thanksgiving 2005)"
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Re: Ultimatum to Saudi's $50 a barrel

Unread postby asg70 » Sun 25 Jun 2017, 21:55:41



The above article is full of equivocations. It's not quite the capitulation the title suggests.

For instance, it says this, which will no doubt make PStarr's blood boil:

The role of high oil and energy prices in triggering the financial crisis, however, remains less certain


And yet further down, correlation = causation is evoked nonetheless:

The financial crisis bares many of the hallmarks to be expected with the end of cheap fossil fuels, and the end of capitalism,


So while the article sort of starts as a capitulation, it ends with this sort of straaaaining towards some sort of a rationalization for how doom could still be right around the corner or that any and all financial problems on the world stage should just be blamed on peak-oil and call it a day (which is pretty much the party-line from the peak-oil remnant).

Now why would Euan Mears (It never ceases to amaze me how many variations of the name Ian exist in the UK) be so reluctant to admit defeat?

His last paragraph has your answer:

As for me, I may start my own blog on energy, climate, and policy - that will not be suitable reading for many existing TODers. For the 7+ years I have been involved with The Oil Drum I have not worked and so any new venture will need to be fully funded, somehow.


And this is his blog, complete with outdated Matrix red-pill/blue-pill header.

http://euanmearns.com

His most recent posts at least seem to focus on AGW insofar as it's about shifting the grid to renewables. Not a lot of fearmongering about oil scarcity anymore.

Also, despite that, his charter message is a sly nod to AGW denialism:

I do intend to put the evidence for man-made climate change under the microscope. There still exists a vast range of uncertainty in climate models and in particular in the data inputs, and it is quite simply impossible for climate science to be settled with the current state of knowledge and understanding.


So basically, he's just another asshole with an opinion and not the sort of person anyone should have been looking up to as an expert in the first place.

But this is a great example because if you look at any of these people that keep cropping up as so-called experts, their actual credentials as evidenced by their batting average on predictions or their actual opinions on controversial topics tend to not be so good.

The reason you have these appeals to authority is the lazy approach of simply googling for a paragraph that claims whatever it is you want to claim and then hold that reference up as "evidence" that the claim is true simply because someone wrote about it on a blog. And that's exactly why 90% of the linking here is to Zerohedge. People start with a conclusion, go cherry-picking, and wind up with almost nothing but Zerohedge in their basket.

BOLD PREDICTIONS
-Billions are on the verge of starvation as the lockdown continues. (yoshua, 5/20/20)

HALL OF SHAME:
-Short welched on a bet and should be shunned.
-Frequent-flyers should not cry crocodile-tears over climate-change.
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