Socialist oil death spiral

Washington Times ^ | November 6, 2007 | Richard W. Rahn

[3AngelaD]

Socialism always plants the seeds of its own destruction, and state-owned oil is no exception...that about 90 percent of the world's liquid oil reserves are controlled by governments or state-owned companies. Exxon Mobil, the world's largest privately owned oil company, owns only 1.08 percent of the world's oil reserves, and the five largest private global oil companies together own only about 4 percent...

There is enough liquid oil in the ground to last generations; and when oil sands and oil shale are included, there is enough oil to last centuries. If there were a truly free market in oil...the price of oil would be a fraction of today's price.

The high price of oil is a direct consequence of artificial supply constraints imposed by the Organization of Petroleum Exporting Countries and other countries, including the United States, and the incompetence and mismanagement found in most state-owned oil companies...

Most of these countries that rely on mainly state-owned companies, such as Russia, have underinvested in exploration and development of new production facilities and mismanaged the ones they have...the U.S. only has about 2 percent of the world's oil reserves, but produces little more than 8 percent of global production, largely because they are privately owned...

A decade or two from now, the socialist states will have severe regrets and here is why...

...the really good news. The new car you purchase a decade from now is almost certainly to be totally electrically powered...As people move to electric cars, the need for gasoline and imported oil will quickly disappear...the world will no longer be held hostage by the socialist OPEC cartel...high oil price strategy is causing their customers to develop economically and environmentally sound alternatives more quickly than if there had been a truly global free market...

[3AngelaD]

This made me smile. Free markets will always prevail in the end. This can't happen too soon. I can hardly wait for the day when we can tell OPEC, Venezuela, Mexico and the others to pound sand.

[facedown]

What happened to “peak oil”?

[businessprofessor]

If only the rats and rinos would get out of the way. The rats and rinos detest markets. They intend to pile on energy mandates, subsidies, and restrictions to choke the economy so that we can reach an energy Utopia.

[2banana]

The market will find away - what the socialists don’t understand in a free system.

Soon - oil will be equal to horse hay. Such fond memories but it ain’t worth jack...

[Eric in the Ozarks]

I think it will probably happen within the next 20-25 years. Cars will be plugged in for an overnight charge. Electricity will be nuclear generated or via some new technology not yet perfected.
You'll know this is going to happen when Exxon/Mobil and a few other majors sell off their refineries and reinvent themselves.

[rellimpank]

—IMHO, he’s a tad optimistic on the timing-—

[Rodm]

How about that Hillary state-own HealthCare, Eh?

[dbacks]

Can you make plastic from electricity?

[madvlad]

It peaked!

MV

[madvlad]

No, but I understand you can make oil from electricity!
The reaction requires speckled nitrogen and racemic lightening!

MV

[3AngelaD]

Plastics production accounts for about 5 percent of U.S. petroleum consumption. Reducing our consumption by 95 percent would be sweet. And you can make plastics from other raw materials. Better living through chemistry.

[50sDad]

You still have to fuel all that additional electrical capacity. I’m hoping for Fusion power, myself.

[mad_as_he$$]

Peak oil always was a BS scam.

[TSchmereL]

A replacement for oil sounds like wishful thinking to me.

Oil is best source of energy available on Earth. There is no good substitute for it.

[3AngelaD]

Read the entire article, please. He is not saying there is a replacement for oil. Perhaps I did a poor job of excerpting.

[ari-freedom]

btw this is another reason why the price of oil should not be a factor for inflation by the fed

[FiddlePig]

Geez... the author answers his own question (sorta). High prices always benefit those holding the commodity (ala monopoly). The monopoly NEVER wants a “free” market!

This also complicated by the fact our enemies control much of the oil supply... we dance to their tune. While they kinda need us as much as we need them (we do buy most of their product)... but they can inflict a lotta pain in the process!

[backhoe]

I have covered, ( Or, as Seamole puts it...
-backhoe's pseudoblog--... ) pseudo-blogged, these issues for years, so allow me to drop out of Lurk and Link mode for a rare bit of commentary-- we all need to get serious about our dependency on foreign sources of energy, and use our own resources.

Our consumer-based economy is driven by and dependent upon readily-available, reliable energy-- choke that off, and we'll all be back to using one rotary dial phone in the dining room, watching one TV in the living room, and driving one car per family-- probably a Hudson Hornet or a Nash Metropolitan...

We need to

1) end the nonsensical ban on offshore drilling off California and Florida--read and weep:

Castro Plans to Drill 45 Miles from US Shores, But We Can't

2) build a lot of next-generation nuclear power plants, not just for electricity, but for any process requiring heat, power, or steam.
And if we replaced our existing nuclear plants with this one there would be significant benefits.

3) end Jimmy Carter's idiotic ban on recycling nuclear waste, and reprocess the stuff rather than fighting over where to bury it. Europe has done this for decades.-- what to do with spent nuclear fuel? Answer here:

 http://www.freerepublic.com/focus/f-news/1468321/posts?page=50#50

hattip: Mike (former Navy Nuclear Engineer)

4) use the 300-500 years worth of coal we have on our own land, using the new clean-coal technology.
-Clean Coal Centre--

5) and finally, there's nothing wrong with conservation, we should all practice it- but you can't conserve your way out of a shortage. Nor is there anything wrong with "alternative" energy sources- except they don't supply the vast ( not to mention readily-available ) amounts of power we need at a price competitive to more conventional sources. Then again, there is this to ponder:

Energy From the Gulf Stream
http://www.energy.gatech.edu/presentations/mhoover.pdf

Not to mention, this new idea:

Irish Ready To Harness Tidal Power

We do need to get serious about this before we get strangled by a bunch of petty thieves and dictators who don't like us much.

My collection of energy-related links:

Sticker Shock-$3 a gallon gas? Click the picture:

And kindly note, and note well-- the first reply to this post ( when gas was $1.45 a gallon ) was derisive... so, who's laughing now?

( And, to honk my own horn, here is a comment from another board on this subject: )

I happened to be going through a post by "backhoe" and followed his link to a thread he posted on 3-17-04. Pretty good thread titled "Sticker Shock-$3 a gallon gas? Some links" that was prophetic, and what do you know, the first reply was Why don't you stop panicking and solve problems that exist posted by "TopQuark." Backhoe has some very good posts, he mostly lurks and when he does post it is worth the read. From the reply that"TopQuark" made he appears to be something of a corn-fed kneejerker, even more so with two years to prove how right "backhoe" was.

Vest-Pocket Summary:

1- drill for gas and oil like crazy- onshore, offshore, and in Alaska
2- go nuclear for power
3- convert stationary plants to clean coal technology or Next-Gen Nuclear
4- slash taxes and regulations like crazy...

[RC2]

This is, actually, an interesting question. For instance, what percentage of oil is actually used to fuel our cars? Oil is used for many other things also but you never see the comparisons.

[353FMG]

“..there is enough oil to last centuries.”

Oh no! You let the cat out of the bag.

“I can hardly wait for the day when we can tell OPEC, Venezuela, Mexico and the others to pound sand.”

That would require for politicians to grow a couple of ba**s to fight the environmentalists and I don’t see anyone with that kind of fortitude. (As an aside, can you imagine the amount of work generated by the oil industry if we were to develop our own crude resources?)