Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Fri Aug 22, 2008 12:17 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TonyPrep wrote:
yesplease wrote:
Is there some statistically significant disconnect between the two?
They may be. What does the consumption graph look like?
It would have to look the same less the potential for excess storage at any given time. I doubt we even have enough infrastructure to store enough oil to produce a statistically significant difference between consumption and production, not that we would since infrastructure use costs money as well so it's use probably isn't practical...
TonyPrep wrote:
yesplease wrote:
Fair enough. Average oil consumption was flat for a decade plus.
Big deal. you tried to give the impression that oil consumption was essentially flat for a decade. That would have been truly misleading, if not corrected.
Are you suggested there would be a significantly different impact on GDP between oil consumption over a decade and it's average? _________________
Posted: Fri Aug 22, 2008 12:38 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
wisconsin_cur wrote:
I can function, without any obvious change, on a decreasing input of calories for some time. For a while there might even be positive consequences. I might begin to look more "healthy" as I loose some weight. I might even get more done initally... especially if over eating led to more naps and bad health.
Eventually, however, the fat stores are used. My face looks thinner. Muscle begins to be consumed. I get less done because I tire easily. If, however, you threaten me enough I can still work. I can still build your bridge over the river Kwai and I can still move bodies around at the death camp.
Eventually, however, I run out of muscle for my body to consume and my organs begin to shut down. Then I die.
Just because GDP can increase for a short time while oil production/consumption decreases (even on a global scale) does not mean that it can continue for very long. If a global market begins to fail, then I suspect the lifespan of that growth would decrease even faster.
Eventually the machinery of growth slows, then we begin to consume the "fat" of the system, then the muscle of the system and then the system breaks apart.
It is time to make arrangements that will survive the current economic system.
In another words we are consuming industrial infrastructure (muscle and bones) built during the high-eroei regime that lasted until the 1990's. But those pipelines, roads, monster trucks, rigs, and tanker are carrying expensive crude cheaply. The Law of Receding Horizons tell us that this is a momentary blip. The arteries are corroding already.
What I find facinating is that the next round of infrastructure development (if it every comes) will employ lots of people and bump the economy a little. But as more money goes into energy aquisition less is available for Mom, Babs, and Buck and their daily shopping. _________________ ree rah rip ram. sunofabitch godamn. hidey didey christ almighty. rah rah crap
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Fri Aug 22, 2008 4:45 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
yesplease wrote:
TonyPrep wrote:
yesplease wrote:
Fair enough. Average oil consumption was flat for a decade plus.
Big deal. you tried to give the impression that oil consumption was essentially flat for a decade. That would have been truly misleading, if not corrected.
Are you suggested there would be a significantly different impact on GDP between oil consumption over a decade and it's average?
I'm suggesting that for 5-6 years of that period you characterized as flat consumption, consumption was rising significantly.
Posted: Sat Aug 23, 2008 6:53 am Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TonyPrep wrote:
yesplease wrote:
TonyPrep wrote:
yesplease wrote:
Fair enough. Average oil consumption was flat for a decade plus.
Big deal. you tried to give the impression that oil consumption was essentially flat for a decade. That would have been truly misleading, if not corrected.
Are you suggested there would be a significantly different impact on GDP between oil consumption over a decade and it's average?
I'm suggesting that for 5-6 years of that period you characterized as flat consumption, consumption was rising significantly.
The period I was referring to was longer than just five years. If oil production goes down 20% over some time period, and then over some equal time period directly after that increases 20%, is it not accurate to say that over the sum of both periods average production was essentially flat?
That doesn't mean that during the larger time period production can't go from +50% to -50% in an alternating pattern over that time period, just that on average over the larger time period production was flat. _________________
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Sat Aug 23, 2008 3:36 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
yesplease wrote:
If oil production goes down 20% over some time period, and then over some equal time period directly after that increases 20%, is it not accurate to say that over the sum of both periods average production was essentially flat?
No it's not, or at least gives a false impression. During the first 4-5 years, the scarcity of oil forced some efficiency improvements, which got the economy growing again, after a short period of recession. Further growth required more oil consumption and for the second 5 years, oil consumption was growing, as was the economy. However, you tried to claim that for 10 years, oil consumption was flat and the economy growing.
Posted: Sun Aug 24, 2008 10:21 am Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
How can it give a false impression? The only way I can think of is if the person didn't understand the meaning of average. But in that case it's simply impediments to communication that are causing trouble, not valid false impressions.
As for the rest, you're doing the same thing wisconsin_cur did. While we do know that economic growth tends to spur increases in the consumption of oil and that oil is required for economic growth currently, we also know from data that economic growth impacts oil consumption far more than oil consumption impacts economic growth. That is to say, it isn't that further growth required more oil consumption for the most part, barring industry use of course, it's that further growth as well as reductions in price tend to induce more oil consumption. This is illustrated by the difference in behavior between the two, where small changes in GDP tend to result in larger changes in oil consumption, while otoh small changes in oil consumption don't seem to result in larger changes in GDP. Since oil is for the most part a luxury item, when the economy contracts oil demand drops significantly. Otoh, for the same reasons, when oil demand drops slightly, there isn't a similar drop in GDP for the most part. _________________
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Sun Aug 24, 2008 3:26 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
yesplease wrote:
How can it give a false impression?
Come, on yesplease, I'm sure you're more intelligent than that. You said it was a decade of flat consumption. It most certainly was not flat, essential or not.
yesplease wrote:
As for the rest, you're doing the same thing wisconsin_cur did. While we do know that economic growth tends to spur increases in the consumption of oil and that oil is required for economic growth currently, we also know from data that economic growth impacts oil consumption far more than oil consumption impacts economic growth.
So, there is a feedback loop. It doesn't really alter the basic point being made.
yesplease wrote:
This is illustrated by the difference in behavior between the two, where small changes in GDP tend to result in larger changes in oil consumption, while otoh small changes in oil consumption don't seem to result in larger changes in GDP.
Really? Well, global consumption hasn't dropped much, if at all. Developed nations are already seeing a marked decrease in economic activity, however, with many economies seeing quarters of contraction or zero growth, even by official figures. But there does seem to be some inertia.
Joined: Feb 20, 2005 Posts: 2886 Location: Uppsala, Sweden
Posted: Sun Aug 24, 2008 5:26 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TonyPrep is not making any sense at all, while Yesplease does.
With TP's logic we could keeping growing the size of our economy for ever by using the trick from the 70's: radicaly cutting production for about 5 years and then increase production again to the level where we choked it, with a GDP much higher than when we began.
Rinse and repeat! _________________ Peak oil is not an energy crisis. It is a liquid fuel crisis.
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Sun Aug 24, 2008 5:57 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
Starvid wrote:
TonyPrep is not making any sense at all, while Yesplease does.
So, you are happy with the characterisation of a decade when oil consumption declined markedly for 4-5 years, then increased markedly for 5-6 years as "essentially flat consumption"?
If so, it's easy to see why you regard yesplease as making sense. I suppose when oil consumption gets down to the levels of 100 years ago, you'd characterise oil consumption over the previous century and a half (or whatever the period is) as "essentially flat". That would be a fairly useless representation of what actually occurred.
Posted: Thu Aug 28, 2008 11:57 am Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TonyPrep wrote:
yesplease wrote:
How can it give a false impression?
Come, on yesplease, I'm sure you're more intelligent than that. You said it was a decade of flat consumption. It most certainly was not flat, essential or not.
No, I said...
yesplease wrote:
If oil production goes down 20% over some time period, and then over some equal time period directly after that increases 20%, is it not accurate to say that over the sum of both periods average production was essentially flat?
So, if we take the average (in mbpd), of year production at 66, 63, 60, 57, 57, 58, 58, 60, 61, 63, 64, 66, 66 over the corresponding 13 year interval we come up with a decade plus average of about 61.5mbpd.
The only way that could give a false impression is if the person interpreting it didn't have even a grade school notion of what an average was.
TonyPrep wrote:
So, there is a feedback loop. It doesn't really alter the basic point being made.
Of course it does. If we depend for the most part on oil consumption for GDP, then w/o oil we can't have GDP. Otoh, if for the most part we depend on GDP for oil consumption, then even w/o oil consumption we can still have GDP.
TonyPrep wrote:
Really? Well, global consumption hasn't dropped much, if at all. Developed nations are already seeing a marked decrease in economic activity, however, with many economies seeing quarters of contraction or zero growth, even by official figures. But there does seem to be some inertia.
The growth rate of world oil consumption is a third of what it was when prices were low, while world GDP growth is down a fifth to a quarter over the same time period. Even in the US, where oil consumption is down yoy, GDP is up. _________________
Posted: Thu Aug 28, 2008 12:02 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TonyPrep wrote:
If so, it's easy to see why you regard yesplease as making sense. I suppose when oil consumption gets down to the levels of 100 years ago, you'd characterise oil consumption over the previous century and a half (or whatever the period is) as "essentially flat". That would be a fairly useless representation of what actually occurred.
I wish I could say "Come on TonyPrep, I'm sure you're more intelligent than that." But I'm not sure that would be accurate.
If we take some interval/data to measure an average of, and every point between the starting and ending points has a greater value associated with it, then the average consumption will be higher, in this case much higher, than the starting/ending values. Otoh, if we take a period where the starting/ending points have values greater than those in between, then the average (consumption in a recent example) over that period is lower than the values at the starting/ending points. _________________
Joined: Apr 06, 2006 Posts: 3625 Location: 3 miles NW of Champoeg, Republic of Cascadia
Posted: Thu Aug 28, 2008 12:29 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
I don't think historic examples are entirely predictive in our case, but at any rate it is impressive how short term breaks in supply hampered production levels for very long spans of time. Imagine what never-ending YOY declines worldwide would entail.
As usual, don't forget the low-hanging fruit of the early 80s: easy gains in vehicle efficiency and the shift away from oil to NG for electrical production. An ad hoc crash program to shift to alternatives won't necessarily be as simple to implement, and rationing is a very likely possibility.
The link between GDP and VMT is much closer and more instructive. Here's a graph of vehicles in the US juxtaposed with number of commuters still driving solo, and the total HEV sales in the US to date (592k):
As you can see the bar for the HEV sales doesn't even register thick enough to display the proper color. HEVs won't be the only attempted form of mitigation of course, although they're almost universally viewed as such, and as I stated above, GDP still is largely correlated with VMT, meaning driving to stores. _________________ Cogito, ergo non satis bibivi
C'mon man, who're you gonna believe?
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Thu Aug 28, 2008 1:35 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
yesplease wrote:
TonyPrep wrote:
yesplease wrote:
How can it give a false impression?
Come, on yesplease, I'm sure you're more intelligent than that. You said it was a decade of flat consumption. It most certainly was not flat, essential or not.
No, I said...
yesplease wrote:
If oil production goes down 20% over some time period, and then over some equal time period directly after that increases 20%, is it not accurate to say that over the sum of both periods average production was essentially flat?
Yup, that's what I said.
yesplease wrote:
If we depend for the most part on oil consumption for GDP, then w/o oil we can't have GDP. Otoh, if for the most part we depend on GDP for oil consumption, then even w/o oil consumption we can still have GDP.
Yeah, oil consumption depends on people doing stuff and people doing stuff depends on oil consumption. You can't have one without the other (at least not in our society).
Joined: Sep 25, 2005 Posts: 2052 Location: Waiuku, New Zealand
Posted: Thu Aug 28, 2008 1:37 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
yesplease wrote:
If we take some interval/data to measure an average of, and every point between the starting and ending points has a greater value associated with it, then the average consumption will be higher, in this case much higher, than the starting/ending values.
Didn't say otherwise. But characterising a 10 year period during which oil consumption had two very marked periods, first of decline, then of increase, as "essentially flat" is misleading, IMO.
Last edited by TonyPrep on Fri Aug 29, 2008 4:14 pm; edited 1 time in total
Posted: Thu Aug 28, 2008 1:37 pm Post subject: Re: IEA: Production up 890,000 bbl in July to 87.8 million b
TheDude wrote:
I don't think historic examples are entirely predictive in our case, but at any rate it is impressive how short term breaks in supply hampered production levels for very long spans of time. Imagine what never-ending YOY declines worldwide would entail.
I'm thinking reductions in use and replacement.
TheDude wrote:
As usual, don't forget the low-hanging fruit of the early 80s: easy gains in vehicle efficiency and the shift away from oil to NG for electrical production. An ad hoc crash program to shift to alternatives won't necessarily be as simple to implement, and rationing is a very likely possibility.
The shift away from petroleum products for electricity generation in the US resulted in a whopping 3,000bpd reduction in consumption. Compared to oil consumption at the time that's a whopping two hundredths of a percent reduction in consumption. It's probably less given regulatory limits on use, but the point remains.
Vehicle fuel economy has greater low hanging fruits than it did in the 70s. We've gone from a vehicle fleet at ~12mpg w/ useful prototypes in the 50-100mpg territory to a vehicle fleet at ~17mpg and useful prototypes in the 70-200+mpg territory, w/ a few needing no petroleum products at all.
TheDude wrote:
The link between GDP and VMT is much closer and more instructive. Here's a graph of vehicles in the US juxtaposed with number of commuters still driving solo, and the total HEV sales in the US to date (592k):
US VMT flat lined in the 70s and early 80s, and Real GDP continued to climb. Like I said before, the biggest impact on GDP is when prices climb initially since consumers need some time to transition to less consumption. In the interim, since they're spending more on fuel costs, GDP takes a hit.
TheDude wrote:
As you can see the bar for the HEV sales doesn't even register thick enough to display the proper color. HEVs won't be the only attempted form of mitigation of course, although they're almost universally viewed as such, and as I stated above, GDP still is largely correlated with VMT, meaning driving to stores.
As illustrated above, VMT only correlates w/ GDP when consumers can't adjust quickly to large price swings. In terms of HEV mitigation, that isn't going to mitigate much due to low volume. The biggest transition is moving away from SUVs and big pickups, down 16% and 23% respectively, even with huge incentives, upwards of 50% off MSRP in some cases, and moving towards small cars which are up 10%. Used cars that are more efficient than average have also seen an across the board increase in price due to strong demand. The US only needs a whopping ~40mpg in two decades to keep up w/ projected oil declines, something France does right now. _________________
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ree rah rip ram. sunofabitch godamn. hidey didey christ almighty. rah rah crap 
