[AdamB]

you lost me at "peak oil is a crock"

I write stuff in English, considering your demonstrated past inability to..you know...understand and stuff....it isn't a surprise you got lost, don't feel bad, a couple decades of thinking and training and maybe a GED and we'll get you right up there to figuring out this understanding stuff.

[AdamB]

You shouldn't be so lost. After all, world refiners are clogged with oil.

Only hopeless ETP zealots can manage the cognitive dissonance of a glut coexisting with oil depletion.

But ETP zealots can tell you why we think we have a glut of oil.

No they can't. And can we keep the ETP sales pitches to the "who is gullible enough to buy my cool report that isn't worth the time it takes to read the title" thread, please? The gullible can all congregate there and get all lathered up over it, plus it keeps them occupied and less inclined to spill their rationalizations over all the other threads.

[AdamB]

My explanation would be that the refineries are clogged with an over supply of poorer and poorer oil, but I can't prove that.

That's because they haven't changed their assay's. And I don't even know how you can tell one assay from another, in terms of "poor". Aren't you one of the ETP sock puppets?

[shortonoil]

Wow this chart is shocking and almost nobody in this thread is clued in enough to notice. There has been no return to normal economic conditions of the 1990s since the sequence of recessions in 2000s and clearly into the present time.

Exactly! All that we have seen has been an explosion of debt to go along with money's steady decline in velocity. It looks to support our argument that we have transitioned from a physical asset accumulating economy to a consumption orientated economy. We are no longer building Golden Gate Bridges, and are instead collecting synthetic CDOs, and leveraged MBS. The energy is no longer there to pursue the kind of economy that we had in the 1990's. We are now down to eating our seed corn.

[donstewart]

'eating seed corn'

For a review of the statistics, with a different explanation, see:
http://www.zerohedge.com/news/2017-06-0 ... -ludicrous

Scroll down to the graph showing the change in GDP minus the change in debt.

There is little doubt that the glory days of the Clinton administration are way behind us. Correlation doesn't prove causation, but I find it hard to ignore the curves in the ETP model crossing around the year 2000. Things haven't been the same since then.

Don Stewart

[marmico]

Wow this chart is shocking and almost nobody in this thread is clued in enough to notice. There has been no return to normal economic conditions of the 1990s since the sequence of recessions in 2000s and clearly into the present time.
Exactly! We are no longer building Golden Gate Bridges, and are instead collecting synthetic CDOs, and leveraged MBS. The energy is no longer there to pursue the kind of economy that we had in the 1990's.

[creedoninmo]

http://www.doomsteaddiner.net/blog/2017 ... s-arrived/

[farmlad]

Marm So construction spending is up What have we got to show for all that money? Maybe they are ramping up the grid to power the millions of EVs coming down the pipeline. here in the corn belt paved roads are being turned back to gravel. Wonder if them thar EVs come in 4x4? I'm sure Trump will find a way to mandate ethanol will go to the new power plants. Win win limitless green energy for all.

[marmico]

$90 billion SAAR on highway and street. Knock off the road pork-barrelling, the corn belt gets enough federal subsidies.

https://www.census.gov/construction/c30/pdf/totsa.pdf

[ROCKMAN]

Don - "..the most relevant question is perhaps 'how many barrels of liquids have to be produced in order to provide the gasoline, diesel..."

Fair enough question. And the answer is that according to the govt the gasoline yield from US refineries has been consistently between 45% and 47% for the last 24 years. If fact it reached the second highest level in 2016:

https://www.eia.gov/dnav/pet/hist/LeafH ... fryus3&f=a

And the diesel yield has significantly increased over the last 24 years from around 23% to 28%. Here's the link to support that. It also shows the yields of the other products.

https://www.eia.gov/dnav/pet/hist/LeafH ... IRYUS3&f=A

There's a good reason the gasoline yields have been so consistent. It goes back to the fact that the refineries crack BLENDED OIL. Oil that is specifically composed to provide the yields the refineries desire. Did you catch my link showing how the gravity of oil refined has stayed constant around 32° API. That's why the yields are so consistent.

And that takes us full circle to my long lost above. The refineries can't get the yields they desire by just cracking 40°+ API light oil that dominates domestic production. And they also can't do it cracking the heavy oils that dominate our imports.

Great how the math works out, eh? Blend 1 million bbls of heavy oil with 1 million bbls of condensate/light oil and...SHAZAM!!! ...you get 2 million bbls of 32° API oil our refineries are designed to maximize.

Amazing how looking at the ACTUAL NUMBERS tends to discredit a lot of the WORDS you read here, isn't it?

[asg70]

how refineries function is exactly what determines the price of those finished products

Then there must be no problem at the refineries since the price is low. End of thread?

[asg70]

For a review of the statistics, with a different explanation, see:
http://www.zerohedge.com/news/2017-06-0 ... -ludicrous

It's funny how no matter how many times the call goes out to stop linking to Zerohedge, the practice continues. It's gotten to the point where I see no reason to even respond to this garbage anymore. If you want to appeal to authority, try somewhere other than a perma-doomer blog.

[ROCKMAN]

creed - "My explanation would be that the refineries are clogged with an over supply of poorer and poorer oil, but I can't prove that." Again if you study this last post to Don you'll see your proof that refineries are not "clogged" with poorer and poorer oil. That oil has been very consistent for decades.

Of course, we can discuss the changes in the quality of oil that has been produced for decades. Hell, just take the Canadian oil sands as a crude no refinery would touch: no refinery cracks that crap. And yet we import millions of bbls per day.. But mix with some condensate and the API increases to 23° and it can be pumped down pipelines to Cushing, OK. And once there it's bought by blending companies that add more light oil that brings it up to 32° API. And from it's bought by Texas refineries who don't give a sh*t if a portion of it came from the oil sands. Just has they don't care that other blends contain some Venezuelan crap.

It's not that difficult to understand once you're familiar with the blending dynamic, is it?

[donstewart]

@Rockman and asg70
First to the question of using a statistic from some original source which is reprinted by Zero Hedge. The original source used a pretty straightforward manipulation of the data...the increase in GDP less any increase in debt. That is very similar to the way Steve Keen looks at the numbers. Those numbers could be reprinted by Steve Keen or Automatic Earth of lots of other sources. Unless you take the position that 'debt doesn't matter', then I think you ignore the statistics at your peril. Whether Zero Hedge reprints them or not is just a psychological problem that YOU have.

Replying to Rockman. Shortonoil replied to me with an explanation I have no reason to doubt. It is possible for a refinery to do a lot of things to manipulate the hydrocarbons, but the manipulation frequently involves using a lot of energy. Shortonoil says that the extra energy is coming from the hydrocarbons being manipulated. For example, if two light molecules are being fused to make a medium weight molecule, it takes energy. The energy has to come from somewhere, and subtracts from the thermodynamic benefits attributable to the hydrocarbon source. Whether the extra energy comes from burning some part of the 'oil' stream or instead from electricity generated by burning coal or gas is a secondary question, important to those in the industry, but which doesn't change the overall thermodynamics. The 'financial sense' can diverge for a short time from the 'thermodynamic sense', but eventually thermodynamics wins.

The stability of the yields from refineries makes sense if we understand how refineries are designed to work. But a very important question is 'how much manipulation is required to massage the inputs in order to make them fit for what the refinery wants to do to them?'' In the case of oil shale from Colorado, the answer has always been, and remains today, 'more massaging than we can afford to do'. Whether the global trend toward mixing very heavy oils and very light oils is 'more than we can afford to spend' is a topic that Mr. Hill said he would address in an SRSRocco post, and which he has been addressing here. I don't have an opinion on that question, because finding the answer appears to require parsing some EIA data. As I have said before, my experience is that understanding what is in government statistics requires some expert knowledge, which I don't pretend to have. Back in the good old days I would go uptown to the Empire State Building and pore through Bureau of Labor Statistics data and put it together in novel ways. But I learned that one had to be very careful and know exactly what the data meant and how it was collected. I'm not the guy to dissect EIA numbers.

Don Stewart

[vtsnowedin]

what are the two lies? And why the cursing? No one insulted you, you aren't even involved in this conversation.

You can't read what is underlined and bold?
I've been in this conversation from the start just not responding to each back and forth unless I had something different to add.
Slapping down shorties lies every time he spews them is something that needs to be done to keep the site credible as letting them stand unchallenged would be seen as agreement with him.

[vtsnowedin]

Wow this chart is shocking and almost nobody in this thread is clued in enough to notice. There has been no return to normal economic conditions of the 1990s since the sequence of recessions in 2000s and clearly into the present time.
Exactly! We are no longer building Golden Gate Bridges, and are instead collecting synthetic CDOs, and leveraged MBS. The energy is no longer there to pursue the kind of economy that we had in the 1990's.

While government debt is still out of control personnel debt is going down. This is why the average credit score has reached 700 and to do that people have been living within their means which is what slowed down the velocity of money as waiting until you have cash in hand takes more time then slapping down a credit card. This is bad news for the credit card companies and importers of cheap goods but not for the country as a whole.
https://fred.stlouisfed.org/series/HDTGPDUSQ163N

[ROCKMAN]

70 - "Then there must be no problem at the refineries since the price is low. End of thread?" Couldn't agree more. I think the biggest problem is that many don't understand that the effect of lower oil prices on refineries is just the opposite as on the oil producers: lower oil prices generally mean high profit margins for the refiners. Common sense, right: refineries don't sell oil...they BUY oil. They sell refined products: Lower oil prices = lower product prices = increased sales volume = increased refinery revenue. Which is shown by the govt numbers: current refining profit margin is $6/bbl.

Consider in May 2013 we were cracking 15 mm bopd according to the EIA. Their latest number: May 2017 = 17.5 mm bopd. IOW according to the govt the oil refiners are currently making a PROFIT of $100 MILLION PER DAY. Or a rate of $38 BILLION PER YEAR.

So your implication is exactly correct: the title of this thread is 100% bullsh*t and amounts to nothing more then a proganda effort. An effort used by some here to spin their own bullsh*t trying to support various models and even ideologies.

So I agree with you: there's not much need for this thread any more. But there was a silver lining: many here probably understand the refinery industry dynamic much better now. Even some of the ones too invested in there own bullsh*t to acknowledge they were wrong.

Can I get an AMEN! brothers and sisters! LOL.

[Cog]

Don Stewart quotes shorty as his source and then tries to hide behind him with statements like "I dindu nuffin wrong". The truth is Don is yet another sockpuppet for shorty. End of story

[donstewart]

@vtsnowedin
See:
https://tradingeconomics.com/united-sta ... ebt-to-gdp
(Note the truncated scale. Zero is a long way down off the chart.)

You will find that 2013 was when private debt reached a post-financial crisis low, but is now increasing again relative to GDP. In 2013 the United States approximately broke even on the increase in GDP minus increase in debt measurement, but has since slipped well into the red.

Government, of course, has remained in the red for a long time...which bolsters the ability of private citizens to spend money they don't have...social security and medicare and medicaid payments, for example. Or all the money spent on the military. The government expenditures are income for, mostly, American citizens.

Don Stewart

Don Stewart

[Cog]

Give it up Don and stick to the thread. You and shorty have been blown out of the water on the refineries so you go off on the tangent "We are all doomed for other reasons".
'
More ETP subterfuge and misdirection.