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The U.S., energy producing superpower

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

Re: The U.S., energy producing superpower

Unread postby rockdoc123 » Wed 14 Jun 2017, 17:31:17

Your explanation fails. Italy, Portugal, and Spain went broke precisely when oil hit $147/barrel. Their only similarity: they have no oil and use the most oil. The hardest hit Euro nations are those most dependent on gasoline and diesel. Cause and Effect. I am not willing to discuss oil economics with one who has so completely swallowed the pill that our consumer oligopoly feeds one. You should stick to the oil business and forget the dismal science. 


No, you are not willing to discuss oil economics because you know nothing about them. If you think for one minute there is anyone out there who spent time on the senior executive of oil companies that doesn’t understand oil economics then you really do have your head inserted someplace where the sun doesn’t shine. As was explained a few times in the past the global credit crisis was truly global. That is what caused the economies of the US and then a number of European countries to begin to tank. (because of the interconnection of bank mortgage debts through derivatives). The fall in oil prices was a consequence not a cause of the credit crisis.

Do I really need to link to all those articles by economists describing the credit crisis and how it went global once again?

But more importantly your use of Spain and Portugal as examples blows your theory all to pieces given Spains consumption of oil increased from 1191 Kbpd in 2014 to 1268 Kbpd in 2016 with a 2% increase from 2015 to 2016. Portugal likewise saw an increase in consumption from 1184 Kbpd to 1232 Kbpd between 2014 and 2016 and a 1% increase in consumption in 2016. So the countries you are using as your poster children for economies that can no longer afford oil actually are increasing their oil demand. But then again you never did like actual data, easier to just make it up.

And also Spain, Portugal and Italy account for about 2% of the global oil consumption. What is happening there is rather inconsequential to the global picture of oil demand, which the BP latest report has confirmed is still growing.
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Wed 14 Jun 2017, 17:49:08

The price that we are paying for oil is not covering the cost of the oil and the price continues to drop. I can think of two explanations.
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Re: The U.S., energy producing superpower

Unread postby AdamB » Wed 14 Jun 2017, 17:59:24

creedoninmo wrote:The price that we are paying for oil is not covering the cost of the oil and the price continues to drop. I can think of two explanations.


2+2<>5

Anytime you predicate a conclusion on faux information, then you can make up anything you want. It is one of the most common stunts in peak oil debates...."if there is less oil produced tomorrow...<fill n favorite doomer porn>..." and so on and so forth. Did the prophets of peak put instructions for this type of logical fallacy in the bible of peak, or is it taught at peak oil sunday school classes during the indoctrination phase of becoming a zealot?
Peak oil in 2020: And here is why: https://www.youtube.com/watch?v=2b3ttqYDwF0
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Wed 14 Jun 2017, 20:30:27

Could you please be precise about what you disagree with. That we are not paying for oil what it costs to produce or that the price is dropping.
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Re: The U.S., energy producing superpower

Unread postby AdamB » Wed 14 Jun 2017, 21:33:50

creedoninmo wrote:Could you please be precise about what you disagree with.


Absolutely.

creedoninmo wrote:That we are not paying for oil what it costs to produce or that the price is dropping.


We are paying more for oil THEN IT COSTS TO PRODUCE. That is a given, as anyone who has ever paid for well tending, water disposal, electricity, royalties, work overs, taxes and everything else related to production can tell you. About 5 seconds after OpX exceeds net revenue, a decision point is reached, said decision to do something to plug the well, bump the revenue doing a workover or recompletion, perhaps a change in production technique, or find a way to cut costs.

No one produces oil to lose money.

As far as oil prices, sure the price drops....sometimes....other times it is climbing, no one disputes that oil prices swing in both directions, and do it every day.
Peak oil in 2020: And here is why: https://www.youtube.com/watch?v=2b3ttqYDwF0
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Re: The U.S., energy producing superpower

Unread postby rockdoc123 » Wed 14 Jun 2017, 23:33:26

You still want to argue that? Really? Bad mortgages in Cincinnati caused debt explosion in Italy?


Do you actually read absolutely nothing of world economic news? This has been published time and again over the years. Do you actually understand how much of the mortgage loans and derivatives were held by European banks. Did you actually read absolutely nothing from 2008 through 2010? Amazing. :roll:

Still quite far from their peak consumption point. Of course Spain fights to motor on. Oil is its lifeblood. And debt is its parasite. 


But yet demand is increasing which means they are buying more oil than they did last year and the year before. Basically demand is not decreasing….they seemingly can afford it which means your choice of Spain and Portugal was ill-informed and stupid at best.

Oh great. you can count. Now count all the other failing economies and their collapsing oil consumption.


Already did as I mentioned up thread but apparently reading isn’t one of your skill sets and what point of Global oil consumption is increasing did you not get?
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Re: The U.S., energy producing superpower

Unread postby asg70 » Thu 15 Jun 2017, 01:29:48

pstarr wrote:Demand may be increasing but it is nowhere near where it was.


Does it need to be? Maybe "where it was" was overheated and where it is now is more realistic.

There is no universally agreed-upon metric that represents economic health. As long as you keep pointing to periods when the economy was doing better you can claim that growth is being suppressed by peak-oil. It's just self-serving goal-post shifting and correlation = causation.

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: The U.S., energy producing superpower

Unread postby marmico » Thu 15 Jun 2017, 04:21:05

The export model on top of the etp model will aggravate the situation even more and makes it even more explosive.


The Export Land Model is such a bust almost 10 years later that I don't believe Brown even updates it anymore. The Russia forecast.

Image

The Saudi forecast.

Image
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Thu 15 Jun 2017, 05:29:49

Adam B: You are basically not saying anything. I am not here to waste my time with someone who says nothing.
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Thu 15 Jun 2017, 05:46:50

The U.S. is not an energy producing super power. We import half of our energy. What we are is a debt producing super power. The title of the thread should be changed. We are a debt producing super power.
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Re: The U.S., energy producing superpower

Unread postby marmico » Thu 15 Jun 2017, 06:08:44

You are grossly misinformed both on energy and debt.

The US is ~90% energy self sufficient. More so if you consider the US, Canada and Mexico as a trading bloc. It is less probable that the US will always be a net importer of petroleum but it is more probable that the US will be a net exporter of coal and natural gas.

https://www.eia.gov/todayinenergy/detail.php?id=29433
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Re: The U.S., energy producing superpower

Unread postby rockdoc123 » Thu 15 Jun 2017, 09:00:04

The economy is in shambles, not the banks. It was the people of the countries that were hurt. Not the bankers.

Are you really that naive, as I said this was explained continually in the press back in 2009 onwards. Banks were behind easy sub-prime mortgages, that pushed up speculation and housing prices. With so much already on the market home owners who bought on spec were unable to sell resulting in default loans which put under several banks in the US, Britain and Europe as they were all invested tangentially into subprime mortgages. Banks only lend when they are sure they will be repaid so you had the double whammy of banks loaning less and mortgage debts that still needed to be repaid which results in a slowed economy and price decreases and eventually a debt deflation spiral. In essence the lack of liquidity from banks and the massive amount of debt that still needed to be repaid result in the recession. Oil prices had nada to do with this.

Demand may be increasing but it is nowhere near where it was. 


Doesn’t matter. The fact it is increasing means that demand for oil is increasing which in turn means there is no problem affording it. Evidence being counter to a lot of the claims made on this site specifically by the ETPers.

And I said it is increasing among the oil producers.


OK that is cheery picking and doesn’t hold for the entire data set. Let’s look at the data. Iran saw production increases by 19% in 2016 and from 2013 to 2016 production increased from 3615 Kbpd to 4600 Kbpd, meanwhile in that same period consumption dropped from 2014 Kbpd to 1848 Kbpd. Kuwait production during the last 3 years saw an increase from 3129 to 3151 Kbpd but consumption decreased from 512 to 499 Kbpd. So clear examples of a countries whose production was increasing but demand was decreasing. As well South Korea has zero production and its consumption increased from 2455 Kbpd to 2763 Kbpd from 2013 – 2016. Phillipines has virtually no production but saw consumption increases from 322 to 435 Kbpd during the same period. Greece has virtually no production but saw consumption increases from 295 to 313 Kbpd during that same period. The pattern you suggest is not supported by the actual data I'm afraid.
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Re: The U.S., energy producing superpower

Unread postby shortonoil » Thu 15 Jun 2017, 10:13:22

The US is ~90% energy self sufficient.


https://www.eia.gov/todayinenergy/detail.php?id=29433

This thing looks like an octopus after it has an epileptic fit! Eight scenarios that all break down to "If pigs could fly"l. But the question; "is the US energy self sufficient, at least from oil" is still not answered. The US imports about 6 mb/d of crude, and exports almost the same amount in finished product. However, it takes an additional 3.8 mb/d to process the 6 imported. Also, the six of finished product exported have a lower per unit energy content than the 6 crude imported. It then consumes 12.5 mb/d of finished product and produces 10 of crude.

Do you get the feeling that the EIA is missing something?
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Re: The U.S., energy producing superpower

Unread postby ROCKMAN » Thu 15 Jun 2017, 10:34:31

creed - "But the question; "is the US energy self sufficient, at least from oil" is still not answered." In a way this also addresses your valid point. If you and I both need the same commodity (which neither of us produces a sufficient amount of) but I can out bid you for what I want: doesn't that make me more "sufficient" then you?. Also the self-sufficient angle only addresses trade balance: if today the US produced 100% of its oil consumption would the situation look much different to the consumer? Remember about 5 mm bopd we import is essentially exported in the form of refinery products. IOW even if the US produced 100% of our refinery input all of it wouldn't be sold to Americans.

But it's still not valid to ignore the FACT that the US does produce a sh*t load of Btu's. LOL.
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Thu 15 Jun 2017, 18:08:31

CNBC is saying that the current drop in oil prices is due to the fact that the Saudis haven't cut supply enough. In another month they will be back out with another story about how the price is going to go back up because OPEC is cutting supply. They've been playing the same game for seemingly years now.
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Re: The U.S., energy producing superpower

Unread postby ROCKMAN » Thu 15 Jun 2017, 23:15:52

As explained many times the price of oil is set by the buyers...the refineries. And they base that price upon what the estimate consumers will pay for those products, and secondarily, how much they buy. The only control the producers have is how much oil they sell. And even if producers reduce the volume of oil to the market place that's no guarantee of higher prices. That was shown clearly in the 80's when no matter how much OPEC (especially the KSA) reduced production prices continued to decline.

IOW it doesn't matter how much OPEC cuts production now: if the consumers won't pay higher prices for the refinery prices the refineries won't pay higher prices for oil.
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Re: The U.S., energy producing superpower

Unread postby marmico » Fri 16 Jun 2017, 04:41:07

Eight scenarios that all break down to "If pigs could fly"l.


Bozo, have you found the missing 8.4 million barrels per day (mb/d) of gasoline in the US since your March 2017 brain fart? Every 90 days, it's the equivalent volume of the Strategic Petroleum Reserve.

For those newbies that don't know what a bozo the Bozo is, the Bozo maintains that in 2016 US refineries produced 1.6 mb/d yet the refineries and the blenders produced 10 mb/d of gasoline.

If Bozo's could fly!
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Fri 16 Jun 2017, 05:19:43

I've just heard that in Louisiana a huge new plant has been built to convert formally waste material into diesel fuel. I'm not sure that are aware of exactly what the trends are in the refining business. It needs more attention. The refineries buy crude oil. American citizens buy gasoline. We can at least agree on that much.
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Re: The U.S., energy producing superpower

Unread postby creedoninmo » Fri 16 Jun 2017, 05:27:27

Rockman: If the U.S. produced enough crude so that we didn't have to import crude, we would have less debt. Our debt started to shoot up after the 1970 when we started to import crude. The reason that the U.S. is an economic super power is quite simply that we can issue debt and the debt is basically ones and zeros on computers that we all trust because well, we are the world's super power. You are right, we can out bid the rest of the world for crude.
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Re: The U.S., energy producing superpower

Unread postby shortonoil » Fri 16 Jun 2017, 07:04:16

"You are right, we can out bid the rest of the world for crude."


That has certainly been true in the past; being the printer of the reserve currency that is used to buy and sell oil is sort of a dead give away on that topic. However, oil is down to $44 and the billion barrel long position taken on by the Hedges over the last 8 months doesn't seem to be doing what it was a few weeks ago. (Assuming) that the purpose was to keep oil at $50 (for what ever reason, support Aramco IPO, support shale, and other losers, etc) oil is down 12%. The COT data is doing something that is hasn't done since 2015. Speculators holding long positions are about equal to Producers and Users holding longs. The number of longs held by Speculators has far exceeded the other since late 2013. Producers and Users (refineries) are buying a lot of long oil contracts in spite of exploding finished product inventories; which could explain the Reuters article on refineries "clogged with oil".

The only explanation that makes any sense is that demand is down in the rest of the world, and the owner of the Petrodollar is getting stuck with the bill to pick up the surplus. The Speculators see the handwriting on the wall; massive and growing inventories are not going to be good for upward long term pricing, and are pulling out of their long positions.

The Etp Model tells us that prices can only go down, and inventories up. Maybe Mr. Market is finally coming to the same conclusion. If true, the Petrodollar is about to get one hell of a workout!

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