Posted on 03/09/2010 9:40:33 AM PST by goldenwings
When oil crossed $120 a barrel for the first time in May 2008, oil cornucopians knew they were in trouble. Prices had quadrupled in just five years, yet had failed to bring new production online. Regular crude had flatlined around 74 million barrels per day (mbpd). The case for peak oil was looking stronger with every new uptick in crude futures.
The following month, prominent peak oil critic and cornucopian Daniel Yergin of IHS-CERA changed his stance: The peak oil threat would be neutralized by peak demand. Gasoline consumption had peaked in the U.S. and Europe, he argued, due to the combined effects of increasing efficiency, biofuels, and the recession.
In 2009 the peak demand story seemed confirmed, as prices stabilized around $70 in June, and U.S. consumption remained well off its previous high. Most people thought the nearly 2 mbpd decline in U.S. petroleum demand from 2007 through 2009 owed to efficiency and people driving less.
In reality, only about 15% owed to reduced gasoline demand. The other 85% was lost in the commercial and industrial sector: jet fuel, distillates (including diesel), kerosene, petrochemical feedstocks, lubricants, waxes, petroleum coke, asphalt and road oil, and other miscellaneous products.
Very simply, when oil got to $120 a barrel it cut into real productivity, and forced the world’s most developed economies to shrink. At $147, it wreaked serious damage.
As I explained in “Investment Themes for the Next Decade,” the new normal will be cycles of bumping our heads against the supply ceiling, falling dazed to the floor, rising back to our knees, then finally standing, only to bump our heads against the ceiling once more.
Scooters Will Kill SUVs
Two interesting news stories crossed the wire this week, which portend badly for the world’s #1 net importer, the U.S. Full article at: No economic Recovery
Oil prices are determined by speculaters.....not demand...not abundance!!!
Wow, it’s like, 2007, all over again!
Drill Here; Drill Now!
PS: We need refineries too.
And watch that evil Obamaperson. He’s trying to put all of the land off limits.
actually I read there is an overabundance of oil refineries in this country right now and their losing money hand over fist.
Several have even been shut down recently.
Bummer. Oh well, I'm just old enough that I don't care. My family will just have to load my coffin on a donkey cart and wheel me to the cemetary -- unless they decide to splurge on renting the donkey too.
We should build proven viable sources of energy at breakneck speed to end our dependence on foreign oil.
Build nuclear as fast as we can, and provide surplus electricity at variable cost to hydrogen producers and vehicle battery recharging stations. Convert the cars off of oil, and our future no longer depends on foreign countries, and we will no longer be funding Muslim terrorist states.
Thing is globalism has worked the other 6 billion folks on this rock like their oil usage too, and they can bid a little higher each year, especially since we have Obama out to destroy America and their economies are growing. We have basically been on a sideways trend for crude oil production since 2005, but the price signal says we should be bursting at the seams with new production, but its not happening, production is flat to declining.
The problem is the left being able to create artificial scarcity through the politicians and bureaucrats they effectively control. There is no energy shortage, peak oil, etc. There is a political problem.
My family will just have to load my coffin on a donkey cart
I remember hearing on the radio day after day after day about how the increase in gasoline prices was all Bush’s fault. In the past nine months the average cost of a gallon of gasoline has gone from $1.689 to $2.759 and not a peep about it being Obama’s fault.
Well, I guess it means my trip to the Sunny Vistas Eternal Rest Farm will be via ethanol-fueled rider mower.
...”We should build proven viable sources of energy....
Build nuclear...surplus electricity at variable cost to hydrogen producers and vehicle battery recharging stations...convert the cars off of oil, and our future no longer depends on foreign countries, and we will no longer be funding Muslim terrorist states.”
Bwahahahahaha. Haven’t you heard that Barry The Muslim is on this?
Bwahahahhhhahahahaha.
Only a minimum of 34 months left. Don’t hold your breath.
Absolutely correct...the left is intent on making anything that helps this country scarce. Shortages...high prices...all an elaborate scheme to hurt our economy and bring it down.
But congress is complicit or Barry the Muslim couldn't get away with it.
OK, how about trying this: you know where the oil is and how to get to it. Just go and get it. No announcements, applications for permission, just start drilling. Hire security sufficient to make enviroweenie snoopers disappear. I doubt if they (the greenie weenies) have sentries stationed at ANWR anyway.
What are the Marxists of the current regime going to do, send in the Army when they find out a couple of years from now?
< /rant >
There hasn’t been a new refinery approved and built for more than 30 years. The refineries that we have are aging and closing. Because of the “boutique” gas blends required in many parts of the country, we have a severe shortage of refining capacity. THat is the excuse for not drilling — no place to refine it.
All we need is another couple of hurricanes in the Gulf, and we’ll be looking at $8/gallon gas. Of course the Dems think that $10/gallon is OK.
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