Posted on 06/04/2006 7:59:38 AM PDT by rdmartinjd
With oil prices reaching record levels, the left is up to its old tricks, blaming the President and calling for lots of expensive big government “solutions”.
As part of this push, they argue that we're running out of oil.
But clearly, this argument is not new -- and it's dead wrong.
In 1874, Pennsylvania's state geologist fretted that America had only a four-year supply of oil left.
He was wrong.
In 1914, Washington claimed we had only a ten-year supply.
It was wrong.
In 1940, the government announced that reserves would be depleted within 15 years.
Wrong again.
In 1977, President Jimmy Carter lamented that within a decade, we wouldn't be able to import enough oil, "from any country, at any acceptable price," to meet our needs.
Hardly shocking, the peanut farmer from Plains was wrong too.
Truth be told, the world's estimated oil reserves grew from 60 billion barrels in 1920 to 600 billion by 1950, 2,000 billion by 1990, and 3,000 billion by the year 2000.
And in the next few years, they'll keep rising.
Why? Because when demand increases and prices rise, companies explore for more. When oil is cheap, they don't. Why should they?
According to Daniel Yergin of Cambridge Energy Research Associates, from 2004 through 2010, production capacity will likely grow from 85 million to 101 million barrels per day, a 20% increase. This forecast is based only on projects already under development.
So the gloom-and-doomers are about to be shown up again.
It's not just exploration either. The left consistently underestimates the power of human ingenuity -- given sufficient price incentives -- to devise new technologies which expand supply.
But in fact, researches say that today -- right now -- we could extract 150 billion additional barrels of domestic oil just by utilizing specialized software and low-cost supercomputers, 175 billion barrels locked in Canada's oil sands, nearly 300 billion barrels -- that we know of -- below the world's oceans, 377 billion barrels trapped in existing oil reservoirs, and a mind-boggling 2.6 trillion barrels embedded in oil shale across western Colorado and parts of Utah and Wyoming.
Altogether, that's more than the entire world's “proven reserves” estimates put together; and that's before we do any new exploration.
Given our high crude oil prices, it's now profitable to do all of this and more. And once done, prices will fall again, just as they did in the 1980s.
But that may not be all. What if oil isn't a scarce fossil fuel derived from dead dinosaurs, but a plentiful resource from inorganic material embedded in the Earth's crust: basically a liquid rock? Joseph Stalin's scientists thought so, and by employing this "abiotic" theory of oil formation, the old Soviet Union found numerous oil fields where Western scientists said little or no oil could exist. Their theory has received greater attention in the West in recent years, most notably from the late Cornell astrophysicist Thomas Gold, and if true, would mean that the world is literally floating on a sea of oil deep in the Earth's core. There might even be oil in space!
The “Limits to Growth” crowd rejects this out of hand, of course; but it doesn't really matter. Either way, the environmental extremists are mistaken:
There is no oil shortage.
There's plenty of oil, even for the 2.5 billion consumers in rapidly industrializing India and China.
Those countries' unprecedented consumption has driven up prices for now, but this will only unleash the supply needed to bring them right back down.
So what about today? How do we lessen the magnitude of price hikes?
Remember those environmentalists who've wailed about supposed oil scarcity?
They've reduced available supply -- and therefore hiked prices -- more than anyone else.
They've blocked offshore drilling. They've blocked drilling in Alaska's ANWR. They've even come up with the most ludicrous political slogan of all time, “you can't drill your way to lower prices.”
They oppose drilling, period. And through their draconian rules and regulations, they've stopped even one single new refinery from being built in America in more than a generation.
The result? Needlessly higher prices for everyone, especially the poor northeastern widows and African villagers for whom they endlessly claim “compassion”.
Isn't it time America stood up to these extremists?
From his first days in office, President Bush has done just that.
It's time we stood up for him. George W. Bush believes in markets, entrepreneurship and human potential. Democrats believe in fear and “redistribution”. And anyone old enough to remember Jimmy Carter should know which course actually works.
-- Rod D. Martin is Founder and Chairman of TheVanguard.Org, America's premier online conservative group. A noted author and speaker, former policy director to Arkansas Gov. Mike Huckabee and Special Counsel to PayPal.com Founder Peter Thiel, he is a member of the Arlington Group and of the Council for National Policy's Board of Governors, and he serves as Executive Vice President of the National Federation of Republican Assemblies (NFRA), “the Republican Wing of the Republican Party”.
This is not a timely argument. And if you don't hold oil stocks, you know it's time to get off this train.
This nation is overdue for making innovative strides in energy.
Oil is a loser for our future. China and India will not be using less energy but more.
That's a lot of dead dinosaurs. /sarc
There is no shortage. The essence of Peak Oil Theory is not the running out of oil, but the running out of easy oil--cheap oil--, which is still not quite here. The fact that the oil shale and tar sands are being poked at now is an indication that the day of easy oil is already in sight and the harder oil will have to be mined. Maybe $70 oil is not seen as cheap oil since we have had $2 oil in recent history, but it is still a bargain. Mined oil will cost more, which is the point of Peak Oil Theory.
Oil is what we use now, and it is at prices which will make the development of alternatives an economic possibility.
A loser? Hardly.
When drilling is prohibited for all but the Gulf Of Mexico on the Continental shelf, (and not too close to Florida, mind you--the Cubans can drill closer than Americans), it is tougher to be a 'winner'.
Add to that ridiculous restrictions on the creation of infrastructure, formulations of gasoline and other motor fuels, and a host of other government mandates, spurred by the envirolobby, and it gets tougher yet.
The shortage isn't created on a drilling rig, but in the halls of Congress and State legislatures across the country.
But Congress wants to keep the price up, it gives people something to rant about while Congress taxes fuel at three times the oil companies' profit, and puts the blame on the oil companies.
Jihad oil is raking in billions of dollars to prop up unstable, facist dictators and unstable, sabre rattling countries, who previously would have never thought about a world without alliances to the world's most powerful nation.
The oil speculators are making money for Iran and Venezuela. They use that money to buy arms and build nukes.
They know Americans will pay a premium for peace. We let them live on because our leaders are afraid to act decisively.
Thomas Sowell explains this in brilliantly understandable prose in his book "Basic Economics: A Citizens Guide to the Economy".
How much of a given natural resource is known to exist is a function of how much it costs to know.
Idiotic. Oil comes from organic matter that predates the dinosaurs.
Gold's theory is BS.
Which doesn't keep it from getting posted here on FR in some form nearly every day.
Nice theory. Prove it.
If you follow the old adage of follow the money, the so called environmentalists are big oils best friend, the environmentalists are more effective at limiting supply than a cartel such as OPEC and the result is to dramatically increase the price oil companies earn for their oil.
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All your statements were just as true during the eighties and nineties when oil was $20 a barrel. In order to understand why the price is now $70 you have to find a variable that has changed this equation. Its just wrong to blame the same oil companies that were unable to explore for new oil when the price was $20 for "capitalizing" on price increases now when they are still unable to explore. The same can be said for the argument that speculation in the futures market is responsible for increases. The same futures market existed in the eighties and nineties, and the price of oil was "speculatively" low. Something has changed to explain these large price increases. the change comes on the demand side.
No. Gold's theory is the bizarre theory outside all conventional understanding.
A simple fact that oil can't survive extremely high temperatures ought to be ample proof enough that it doesn't seep up from the mantle or core.
Believe what you want. Flying saucers, abiotic oil generation, crop circles, I don't care. The burden of proof is on you. Gold is dead. You prove his bizarre theory.
Simple. Oil is liquid fat. Only organic material can produce fat. Ergo, oil comes from animals.
good post
Duh. See these people flew planes into the world trade center. Then there was a war in the middle east. Still is one. And then Iran developed nuclear weapons tech and we all found out about it, still happening. And then several dictators nationalized oil industries in their countries.
Meanwhile, all that happened on the demand side is gradual growth of a few percent per year, marginally faster in 2003 and slowing in the last year and a half due to higher prices. The average growth in demand over the last 3 years is less than 3%, and the current projected rate is 1.5% per year. US crude stocks have grown throughout the price increases. There is no shortage.
The capital available to the industry has about doubled at these prices, if it wants to capitalize its present earnings to fund anything. It doesn't take twice the capital to get 1.5% more oil. And the extra earnings are not going to capital - they are going to governments in the consuming countries in taxes, a modest portion to existing shareholders as cash returns (dividends, share buybacks, cash piling up in the bank), and almost all to the governments of the producing countries, where it finances current consumption of things other than oil.
Like, you know, Chazev buying AKs and the Iranians getting nukes.
The standard and most likely theory is that oil comes from decomposing biotic matter mostly from plants. The alternate theory, which notes that e.g. natural gas (a much simpler organic molecule) occurs in plenty of places where there is no possibility of a biotic origin, thinks oil may have organic but non-biotic origins, as well as occuring biotically. I think the evidence for that is rather thin, but it isn't transparently impossible, as your comment pretends.
Wow, that's good news. I can't wait until we find massive new oil reserves that our politicians won't let us drill.
Don't be ridiculous. Oil is a bigger future for North America than the Middle East. But don't limit your thinking to traditional reserves. Count the Oil Sands and Oil Shale and even Coal.
I agree.
>>>>Oil is a loser for our future.
I disagree. Oil will be part of the US future energy policy and the future of the the worlds energy policy for the next 200-300 years. As long as there is oil in the ground and human beings can extract it at a reasonable cost, we'll get it out. Period!
Uranus' atmosphere is about 83% hydrogen, 15% helium and 2% methane. Uranus has bands of clouds that blow around rapidly.
If I interpret you correctly only animals can produce organic materials. If so where doe the methane in Uranus come from?
Gold's theory is BS.
Which doesn't keep it from getting posted here on FR in some form nearly every day."
Really? Read on McDuff!!!
HYDROCARBON HERESY: ROCKS INTO GAS
Tue, 1 Nov 2005
Geologists have long believed that the world’s supply of oil and natural gas came from the decay of primordial plant and animal matter, which, over the course of millions of years, turned into petroleum.
Two diamond anvils, each about 3 millimeters high, in a diamond anvil cell. They compress a small metal plate that holds the sample. The device can generate pressures greater than those in the center of the earth (3.6 million atmospheres) The methane generation experiments use pressures in the 50-100,000 atmosphere range, corresponding to the earth’s upper mantle.
Photograph courtesy of Dudley Herschbach But new research coauthored by Dudley Herschbach, Baird research professor of science and recipient of the 1986 Nobel Prize in chemistry, questions that thinking. Published last fall in the Proceedings of the National Academy of Sciences, the study describes how investigators combined three abiotic (non-living) materials—water (H2O), limestone (CaCO3), and iron oxide (FeO)—and crushed the mixture together with the same intense pressure found deep below the earth’s surface.
This process created methane (CH4), the major component of natural gas.
Herschbach says this offers evidence, although as yet far from proof, for a maverick theory that much of the world’s supply of so-called fossil fuels may not derive from the decay of dinosaur-era organisms after all.
Herschbach became interested in the origins of petroleum hydrocarbons while reading A Well-Ordered Thing, a book about the nineteenth-century Russian chemist Dmitri Mendeleev, who developed the periodic table. Written by Michael Gordin ‘96, Ph.D. ‘01, a current Junior Fellow, the book mentions a theory long held by Russian and Ukrainian geologists: that petroleum comes from reactions of water with other abiotic materials, and then bubbles up toward the earth’s surface.
Intrigued, Herschbach read further, including The Deep, Hot Bio-sphere by the late Cornell astrophysicist Thomas Gold.
An iconoclast, Gold saw merit in the Russian and Ukrainian view that petroleum has nonliving origins. He theorized that organic materials found in oil—which most scientists took as a sign that petroleum comes from living things—may simply be waste matter from microbial organisms that feed on the hydrocarbons generated deep in the earth as these flow upward.
Another of Gold’s assertions about methane and oil really caught Herschbach’s attention. “He said there wasn’t much chance that you could do a laboratory experiment to test this,” Herschbach reports. “And I thought, ‘Holy smoke! We could do this with the diamond anvil cell.’”
Long interested in how molecules behave under high-pressure conditions, he contacted Russell Hemley, Ph.D. ‘83, a former student now at the Geophysical Laboratory at the Carnegie Institution of Washington, to suggest the methane experiment.
Together with Henry Scott of Indiana University and other researchers, Herschbach sought to create the same conditions found 140 miles below the earth’s surface, where temperatures are scorching and pressures mount to more than 50,000 times those at sea level. “It’s a great pressure cooker,” he explains.
The diamond anvil cell, developed at the Carnegie Institution, can create the same pressures found as far as 4,000 miles beneath the earth’s surface. The cell employs two diamonds, each about three millimeters (roughly one-eighth-inch) high, which sit with their tips facing each other in hardened precision frames that are forced together, creating intense pressure in the small space between the tips.
Diamonds are an ideal material for such experiments, Herschbach explains. As one of the hardest substances on earth, they can withstand the tremendous force, and because they’re transparent, scientists can use beams of light and X-rays to identify what’s inside the cell without pulling the diamonds apart.
He notes that previous experiments by Russian scientists arrived at different conclusions because they used an old-fashioned press that had to be opened before any products inside could be analyzed, potentially changing the results.
“The experiment showed it’s easy to make methane,” Herschbach says.
The new findings may serve to corroborate other evidence, cited by Gold, that some of the earth’s reservoirs of oil appear to refill as they’re pumped out, suggesting that petroleum may be continually generated.
This could have broad implications for petroleum production and consumption, and for our planet’s ecology and economy.
But before we begin to think of petroleum as a renewable resource, Herschbach urges caution. “We don’t know if a globally significant or commercially significant portion of methane might be formed abiotically from this pressure-cooker business,” he says. “Even if we did convince ourselves that a lot of hydrocarbons are formed that way, we don’t yet know how long it takes for it to percolate up and refill the reservoirs.”
For Herschbach, these exciting research questions have “given me a second scientific childhood.” He and his colleagues are eager to return to the lab and find out if even higher pressures will create more complex hydrocarbons, such as butane or propane.
The research raises fundamental questions about how scientists determine if a material has living or nonliving origins.
It also validates the work of previous scientists.
“The fair conclusion,” Herschbach says, “is that the views of Thomas Gold and Russian scientists all the way back to Mendeleev need to be taken more seriously than they have been in the Western world.”
~Erin O’Donnell
http://www.harvardmagazine.com/on-line/030573.html
BFD.
Methane is produced by volcanoes, is found in liquid form on Saturn's moons, and is produced by cow farts.
Tell me something about OIL.
You trying to get kicked out of the rich oil men's club, letting out our secret that we get oil from UFOs that crash.
Oops, I did it too.
What if morons actually figured out that no scientist anywher has ever claimed oil is from dead dinosaurs?
What has driven the recent price spike is obvious, fear of potential disruptions to supply caused by Iraq, then the Iraqi insurgents and now Iran. The one thing that holds true about capitalism is that it always over produces, thus driving down prices in real terms. Rockefeller tried Standard Oil as a way to prevent that outcome. Trusts and cartels are another option but as with OPEC, members will almost always cheat and produce more than their quotas allow. Environmentalism has proved to be a more effective means of limiting production. Demand has assuredly increased but not sufficiently to explain the entire price spike, even for a product with as inelastic a demand curve as oil. When you look at the American market the price of gas fluctuates even more dramatically than the price of oil. Environmental laws such as those requiring numerous different blends of gas for each small market limit the ability to quickly shift supplies to where they are most needed. We have the technology to produce more energy than we need but options such as nuclear, coal or drilling for more oil and natural gas are kept from serious consideration.
You owe me a new keyboard.
Chilli and Beer?
You must have a lot of oil stock to be saying that.
Gold's theory is BS.
Which doesn't keep it from getting posted here on FR in some form nearly every day.
Yet just a few days ago, you agreed:
I don't have a problem with the deep hot biosphere theory as to natural gas,
Volcanos spew methane. There is liquid methane on the moons of distant planets. Clearly that didn't come from fossil sources.
53 posted on 06/01/2006 7:51:12 PM PDT by Dog Gone
Somehow you equate methane with oil. They are not the same.
It is perfectly consistent for me to say that methane can be produced from sources other than from organic matter (although it certainly IS produced from organic matter, too), and that oil cannot.
Gold's theory as to OIL is BS.
Its called capitalism.
No problem with capitalism or your defense of your outstanding investment(s).
If I was heavily loaded into a commodity, I'd be selling it too.
Buy my stuff, there's plenty!
You miss the point. Free market capitalism will dictate the future of oil exploration and drilling. The worlds oil companies have trillions of dollars invested in current operations and future ventures. They're not about to drop it all because a bunch of environmentalist wackos oppose continued use of fossil fuels. One day there will be drilling in ANWR and other locations throughout Alaska, off the California coast and in the Gulf of Mexico. There is plenty of oil to be extracted from Mother Earth and it will happen.
Well now that you have made a clear point let me refrain. The US companies are not doing much drilling to counter the demand from India and China and that demand will be weighing heavily against current supply. There is no magic faucet to counter that increasing demand from those two countries along with the growing global demand.
The idea that the world has enough potential oil is merely that: potential. It does not counter the current lack of supply driving up prices and the resulting gas signs hovering well into $3 now.
As for the US, the ability to refine the product is as much a problem as identifying and obtaining the raw one. It can't be done overnight and whatever is started now will not even remotely begin to counter the ever increasing percentage needed from abroad.
This country needs a huge counter to this situation. And the sooner the better as it's long overdue.
Oh, Stalin - that paragon of well thought out science policy. Was this before or after he had all the geneticists in the Soviet Union imprisoned/killed because Darwin was anti-communist?
I love this: " ... some of the earth’s reservoirs of oil appear to refill as they’re pumped out, suggesting that petroleum may be continually generated. ..."
It's the oil fairy!
My points are always quite clear. You need to pay attention. Capitalism works better when govt regulation is limited or removed. Those of us who lived through the oil crisis of the early 1970`s and the subsequent rise of OPEC as a major power player realize, $3/gallon gas is still cheaper priced then gas was in the Carter Era. Folks like to overreact, especially liberals. The fact remains. As long as fossil fuel is a viable source of energy, human beings will find a way to extract it from Mother Earth. This issue is all about captialism, enviro-wackoism, market forces and basic supply&demand. There is no miracle solution.
First, you did not illustrate your position at all. Second, your diatribe against enviromentalists and wackos as a whole is not an adequate response to the current supply and demand equation.
The issue is most certainly about supply and not the other forces you indicate.
There is not an adequate supply at the $50 mark and there will not be for any time in the near future.
The US is overdue on finding other answers. This nation is capable of such.
LOL My points are right on the mark. You offer no evidence to dispute the facts, so you attack the truth. Weak.
Once again, you're not paying attention, which leads me to believe you're a liberal troll. The article thread is about the oil shortage myth. There is no oil shortage. As I made abundantly clear.
This issue is all about the forces of conservatism on one side --- captialism, limited regulation, market forces, basic supply&demand --- and liberal enviro-wackoism on the other side. Free Republic supports the former, not the latter.
Oil's first cousin Methane, (CH4 + 2O2 ¨ CO2 + 2H2O) an organic compound, is quite plentiful in space.
You're reaching pathetically for a straw man. No one is talking gold except you.
The problems in the oil supply are going to get worse and are not going away.
Let us all know when you are paying $2 a gallon.
It's not going to happen. But if you think you are getting it from outer space then good luck to you, Jupiter, Saturn and yUranus.
I don't know how many times I have to repeat that methane has many sources including non-organic ones.
Nobody disputes that, and Gold's theory that it might come up from the mantle of earth is stating the obvious since we already knew it was emitted by volcanoes.
Duh.
It's the oil that is the problem with his theory. OIL.
Find me some oil floating in space or in an open sea on a moon of Saturn.
Natural gas and oil are not first cousins. They're not even related except that they're often found in the same underground reservoirs.
If that makes them first cousins, then WATER is also a first cousin. So is carbon dioxide. So is sulphur. They're all found with oil.
Does Deep Earth Host Untapped Fuel?
ABCnews.com | January 19, 2006 | Lee Dye
Posted on 03/05/2006 4:03:29 PM EST by billorites
http://www.freerepublic.com/focus/news/1590519/posts
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