Peak Oil News and Message Boards

Output goes down but compound interest keeps growing no matter what. The net is that the world is going to get a lot further behind on its debt payments this year. It is only a matter of time until the whole world owes more than the world is worth.

TF

Paul Volcker joins the chorus of doom

NEW YORK, Feb 20 (Reuters) - The global economy may be deteriorating even faster than it did during the Great Depression, Paul Volcker, a top advisder to President Barack Obama, said on Friday.

"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," Volcker said.

http://www.reuters.com/article/marketsNews/idUSN2027144420090220

Haha! The IMF price prediction is looking pretty good!

It's so much fun browsing through old threads here.

OilFinder2 wrote:Haha! The IMF price prediction is looking pretty good!

Yes, and last year it looked terrible, who knows how it will look in 2012, or in the actual year of their prediction. Already they failed to foresee extreme price volatility, which many here called. Cherry picking prices at this moment in time is both petty and irrelevant. Get your nose out of that back catalogue, you'll go blind

yeahbut wrote:

OilFinder2 wrote:Haha! The IMF price prediction is looking pretty good!

Yes, and last year it looked terrible, who knows how it will look in 2012, or in the actual year of their prediction.

The prediction was for 2010 - next year. And taking into account inflation (as mentioned in one of the posts above) that would be about $45. Not bad!

yeahbut wrote:Already they failed to foresee extreme price volatility, which many here called. Cherry picking prices at this moment in time is both petty and irrelevant.

Yeah but it's fun.

Here ya go, the prediction in nominal terms.

sulayman wrote:I asked the FT about this, and they said in reply....

Dear Sir,

the figure is right.
IMF is forecasting $34 in real terms in 2010, that would traslate in money
of 2010, that is, nominal terms (if we assume inflation rising yearly at 3
per cent) of a price about $45. The forecast for 2030 is $39-$56, that
would traslate in nominal terms: $80-$120.
In any case, IMF is talking about a "permanent oil shock" as if we look
back, oil prices between 1990 and 2000 were, on average, below $20 in
nominal and real terms. And no other international body has talked, at
least in public, of prices soo high.
best

bobbyald wrote:

wow, are they rich?

No, far from it and that's the problem of course.
If people wont give up their cars even when it begins to hurt we are in for one hell of a jump in prices.

In Europe even at $34 gallon if people cut consumption by 50% then their cost has "only" doubled and people will do this rather than give up their car.

$34 per gallon works out to roughly $13.65 SGD per liter, which then works out to around say 110L x $13.65 = $1501.50 SGD per month for me, which if you convert back is roughly USD $1000 per month.

It's going to be a bit of a stretch, even considering my Civic Hybrid. That's $800-900 of *other* stuff that I won't be buying, eh?

Oilfinder,

Here you are again throwing out another old post with which you get to say look! I told ya so!!

I'll comment that once again it's childish and does nothing to further any discussion of the real problem which faces us moving forward.

I'll give you a little task which will surprise you a lot more than this silly one your about at the moment.
Go back twenty years and look at the major energy agencies predictions and see where we are right now with respect to those. I think you might just start singing a slightly different tune.

Prices are going to be volatile for many reasons, but the volatility is the key. It should tell you something that the biggest swing in the price for crude just occurred and I can gaurantee it wasnt because we all of a sudden have a glut. If you truly believe that then your having the wool completely and successfully pulled over your head.

AP -- I respect your opinion of OF2. But I'm glad we have him as our Energizer Bunny of Future Production. Not that agree with all his forecasts but I've come to enjoy his stoic temperament. He is a ROCK. Beat him, abuse him, confront him with contradictory arguments and he doesn't flinch. And we geologists like rocks. We might break them open, grind into powder and run them through x-ray diffraction to see what's really there. But a rock is one of the few unchanging objects in the universe (except, of course, when they are subducted back into the mantle and re-melted). The rock cycle will continue unabated for eternity...and so will OF2.

no-oil,

China is already ahead of most countries with respect to your proposal to focus on the heavy/sour stuff in the future. If you didn't catch it, they cut a deal with Venezuela last year: China will build 4 special tankers and three refineries in China designed specifically to handle Vz heavy crude. In return they received a long-term sovereign guaranteed crude supply.

China has had a single minded goal for at least the last ten years: secure long term oil resources. The bought interests in many fields around the world and have financed many more. In fact, I think the just offered Brazil billions to fund their Deep Water. The details are never disclosed but I'm certain that many include a "right of first refusal". Thus, in addition to what crude they own out right, they control that much more by freezing out the rest of the market as long as they can match the price in the market place.

Bump with a new question:

For the last four years I have keep records of the Brent Spot price (closing price only for the main trading days). I find the figures for this year a bit of a puzzle, with both apparent stability and apparent high volatility.

A) Oil prices seem to be in a trading range ($ 40 - 50 / barrel).

B)The twenty day moving average seems to indicate a small but steady rise since the beginning of the year ($40 to just over $43 - 8% in two months).

C) The volatility index that I use (daily %-price change averaged over the last 10 days) is very high, and has been high all year. A surprise is that because prices are joscillating up and down, there seems to be more volatility now than in the run up to the high prices we saw last year.

Would anyone like to comment on the apparent stability of the trading range but the high volatility due to large (percentage) changes in prices most days - I am not sure what to make of all this.

But but, but all the experts say Tings are good. The big Panic is all over. Don't worry be Happy. http://www.telegraph.co.uk/finance/financetopics/recession/5166956/IMF-warns-over-parallels-to-Great-Depression.html

When they remake the Wizard of Oz and the flying monkeys
are hedge fund managers, Toto is a Portuguese water
dog, and Dorothy maxes out her cards and is turned down
on the ruby slippers, then you can worry. Until then,
just follow the yellow brick stimulus.

Makes me feel a little bit better... the US seems to be holding up ok, compared to everyone else anyway.

Ex-IMF guy says the financial oligarchs have hijacked the US govt.:

Link--http://www.theatlantic.com/doc/200905/imf-advice

Quote:
"The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time."

If this has been posted elsewhere, my apologies, but I don't remember seeing it.

Reading it shook me pretty good, mostly because i read somewhere that this fellow is going to testify before Congress soon. I hope that means something more than the normal window dressing we get there.

the position is much worse than 1930's

1 no credit cards in 30's
2 no cell phone or cable tv bills in 1930's
3 very few people owned cars , another huge cost
4 energy much cheaper, oil companies making massive profits
5human pop unsustainable now
6global overheating huge timebomb
7 real wages failing

What they really see is a DEPRESSION but they haven't yet been able to say the word. http://www.theglobeandmail.com/servlet/story/RTGAM.20090422.wimf0422/BNStory/crashandrecovery/home

kiwichick wrote:the position is much worse than 1930's

1 no credit cards in 30's
2 no cell phone or cable tv bills in 1930's
3 very few people owned cars , another huge cost
4 energy much cheaper, oil companies making massive profits
5human pop unsustainable now
6global overheating huge timebomb
7 real wages failing

...you forgot peak oil. energy won't only be more expensive, it will be less "dense".

link

GM’s demise should not be read as a harbinger of doom for the car industry. All around the world people want wheels: a car tends to be the first big purchase a family makes once its income rises much above $5,000 a year, in purchasing-power terms. At the same time as people in developing countries are getting richer, more efficient factories and better designs are making cars more affordable. That is why the IMF forecasts that the world will have nearly 3 billion cars in 2050, compared with around 700m cars today. In the next five or six years the Chinese will overtake the Americans in terms of annual car sales: in 40 years’ time the Chinese will have almost as many cars as exist in the whole of the world now. Indeed, GM’s own experience abroad shows the promise of emerging markets. Brazil has long been a source of profits, and GM has a leading position in China.

Well, there goes the IMF's credibility for me.

If the auto fleet did quadruple, what would our air be like then?

Sounds like utopia!

IMF? Big part of the status quo who only wants to see their profits enlarged forever.

MMM permanent exponential growth is good. Get with program man!